Wednesday, November 30, 2005

Tyranny of the Marketplace -- Part II

To absolve themselves from any appearance of abject greed, we often hear a CEO, a securities analyst, a member of The Board, or some other pompous windbag say "We are beholden to the shareholders, and it is they who demand these profits."

In these cases, we are asked to believe that "the shareholders" are some broad section of America, a large class of individuals much like ourselves, as we hold shares in this or that mutual fund.

Nothing could be further from the truth.

In the so-called free market, it's not one-person-one-vote. More like one-dollar-one-vote. Only the largest shareholders have voting rights that mean anything, and those largest shareholders are mostly institutions. And those institutions are themselves beholden to their largest shareholders, again institutions.

So the moral buck is passed, circle-jerk style. No one ever comes right out and says "We're greedy bastards. F*** the workers."

It's those shareholder that made us do it.

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