THE TEXAS OF MY MIND … HAS BEEN A LOG CABIN IN VERMONT WITH ADJACENT MOUNTAINS, A BIGGER POTATO PATCH EVERY YEAR, AND NO INSTITUTIONAL CONNECTION TO PROTECT AND DEFINE OUR EXISTENCE. sound meddlesome and ridiculous, even though their idea \(for example, to unmistakable merit. ‘ You ask your investment counselor about the proposaland maybe the salaries too. By a curious professional code of ethics, he abstains from advising you on the only meaningful decisions you have to make about this money for which you are responsible. Stockholders have no way, and usually no desire, to communicate with each other about such matters. I understand that foundations and institutions follow the same blind course and vote with management. Is management automatically right as long as financial reports stay in the black? Is anyone listening? Is anyone thinking? I haven’t seen it happen yet. Every attempt to broaden the base of stockholders by stock splitting means less participation, greater distance. We tacitly support the system by merely having a bank account or by owning a few measly shares of a corporation over which we exercise not the slightest control and which, on the contrary, propagandizes us with glassy annual reports and other assorted handouts. But you are not supposed to be concerned about all that. The youngest heir and the oldest counselor will tell you that what counts is to show a profit. Nothing else matters. Nothing else is even measured or counted. A few harried and reluctant universities may have sold out their Dow Chemical during the hurricane of the late Sixties. But no intelligent investment committee could conceive, then or now, of putting money in a firm that does not make a good return or promise growth. “Owners” are not expected to ask pointless questions about how the profit is turned and who else is getting a cut. Is there another way? I’m not referring to any distinction between conservative, blue-chip investing and risk capital. My question concerns the nature of ownership itself. How could I invest my money so as to establish accountability on both sides and further the honesty and decency my father and mother believed in? Is that so ridiculous a hope? Even if I threw everything into one small corporation producing sound goods under enlightened policies and at a reasonable profit, my paltry holdings would be no more than a drop in the ocean of its capital assets. One noisy stockholder may do more harm than good, though a few sturdy cranks have obtained small concessions. The only language is votes. And votes follow the single goal of making the best profit possible. If you want anything else from a company, give up and sell out. Against such odds, one is a fool to do anything but conform. I won’t accept that conclusion. We haven’t yet mobilized ourselves within the capitalist system. We remain enslaved by absentee ownership. It’s right here that my proposal comes, a proposal generally yawned at by investment counselors and economists I have talked to. It would never get off the ground. Yet I refuse to give it up. For there must be others like me who accept a fiduciary responsibility for money that is legally theirs, but morally many people’sdead, living, unborn. Could not a group of dedicated and knowledgeable investors set up a mutual fund in the public interest? The purpose of such a fund would be twofold: to invest people’s money so as to preserve its value and if possible to turn a small profit; and to pool many small holdings in such a way as to gain a significant voice in the votes and policies of a few chosen corporations. I don’t imagine that many people would want to invest more than half their capital this way. But even at that rate, the sums could add up. This kind of mutual fund would consult its stockholder about how to vote it proxies and about policies to pursue. What are the issues? Not only directors and their salaries, plus such closely related matters as interlocking directorates, but also pricing, mergers, advertising, development, accounting procedures, corporate gifts, and a host of other sensitive questions that the ordinary shareholder is encouraged to consider none of his business. Stockholders, it is true, cannot manage; but they should oversee. Otherwise no one will, except the great unblinking Cyclops called Profit. A variation on the presumably private mutual fund scheme would be for a non-profit public interest group to serve as investment counselor for per 30 THE TEXAS OBSERVER JANUARY 27, 2006
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