November 21, 2009
UTNE READER

Shareholders Need to Share the Wealth

(Page 2 of 2)

July/August 2002 Issue
By Craig Cox, Utne Reader 
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We accept this unjust and largely illogical favoritism toward shareholders over all others because it is the law of the land. Corporations operate this way because if they do anything that imperils the quarterly dividend (like keep a struggling inner-city plant open to save jobs) they are subject to shareholder lawsuits. CEOs get fired over such fits of altruism. "Return on equity functions a bit like the Mafia, demanding a larger and larger payment every year, or the hostile takeover folks come and break the CEO’s kneecaps," Kelly writes.

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Rather than sound economics, this exaltation of shareholder interests is actually a form of discrimination—valuing money invested by rich people more than the contributions of workers and others. But just as activists successfully struggled for legislative remedies against racism and sexism, so can we fight wealth discrimination.To battle this wealthism, though, we must first name it and acknowledge its influence in our corporate-dominated life, Kelly argues: "Because we fail to name this discrimination precisely, we fail to see how it functions (how many people understand how financial statements work?) and we fail to claim its history."Next, we must understand the possibilities. Already, groups across the country are organizing around efforts to revoke corporate charters, and shareholder activism has become a regular feature of corporate annual meetings. Plus, the anti-globalization/pro-democracy movement is successfully drawing attention to global corporate piracy on a variety of fronts. Multinational corporations have never seemed so dominant, yet never been so shaky."There are seams of vulnerability here, once we think to look for them. Great seams of illegitimacy, of a creaky antiquity," Kelly writes. "Change might result more quickly than we imagine."
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