Corporations and Stakeholders

Many people believe, improperly, the only obligation corporations have is to maximize shareholder returns. This is a belief encouraged by repetitive assertion and open eared credulity.

But there is “no law [that] requires corporations to maximize returns to share holders

In fact … No such law in any of the 50 states even raises the topic of maximizing shareholder returns. ”

The idea that corporations exist to reward their shareholders arose not in a body of law but from the work of ideologically driven economists. In 1970, Milton Friedman wrote that business properly had but one goal: to maximize profits. The same year, Friedman’s University of Chicago colleague Eugene Fama argued that a corporation’s share price was always the accurate reflection of the enterprise’s worth, an idea that trickled down into the belief that the proper goal of a corporation was to boost its share value — particularly after most CEO salaries and bonuses became linked to that value.

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McDonalds ♥ Vietnam

It is still amazing to read how recent enmities have receded into the distance, even if not quite forgotten, how people who were thought to be the devil incarnate yesterday are happy customers, if not friends, today.  Here, yet another example.

McDonald’s, the fast-food giant, which has restaurants in more than 100 countries and will open its first Vietnam location on Saturday in downtown Ho Chi Minh City.

Vietnam has a surging middle class, and most of its 90 million citizens were born after the Vietnam War ended, in 1975. Many young Vietnamese are insatiably curious about foreign cuisine and culture, like kebabs and K-pop, and the McDonald’s opening has been widely discussed on Vietnamese websites in recent weeks.

fastfood-ss-slide-JDAL-jumbo

The uncommented on tid-bit in the NY Times article is that  the ruling communist party has its entrepreneurial fingers deep in the growing pie.

McDonald’s waited a long time to open in Vietnam, given its global brand recognition and likely appeal to young Vietnamese consumers. When it did, it tagged Henry Nguyen, the son-in-law of Prime Minister Nguyen Tan Dung, as its local franchisee.

Everywhere we went on a two week trip to Vietnam in the spring of 2013, if a hotel or venue or location was high-class, the party higher-ups were behind it — the greatest example being the fine hotels, piers and boats at Ha Long bay, North Vietnam.  Everyone of these places has the party OK, if not direct investment by top officials.  Soon, Vietnam will have the same oligarch problem bringing the US economy into a state of ruin.

Money out of Politics: Amend the Constitution

A coalition is demanding that the US Constitution be amended—a reform sufficient to prevent the High Court from transforming American democracy into a dollarocracy.

“I’ll grant that it’s not easy. Amending the Constitution should not be easy,” says Robert Weissman, the president of Public Citizen, which has been a key player in the movement. “But in just four years, we’ve brought what many deemed a pipe dream into the mainstream.”

People for the American Way president Michael Keegan agrees.

While there is no question that “the deeply misguided Citizens United ruling four years ago brought immeasurable harm to our democracy,” Keegan says, “it also inspired a re-energized national movement to get big money out of politics.”

That movement has accomplished more than all but the most optimistic reformers could have imagined on January 21, 2010.

Sixteen American states have formally demanded that Congress recognize that the Constitution must be amended in order to re-establish the basic American premise that “money is property and not speech, and [that] the Congress of the United States, state legislatures and local legislative bodies should have the authority to regulate political contributions and expenditures…”

Common Dreams

16 state demanding is a long way way from 34 states signing (2/3rds necessary) to amend the constitution.  It will take a tidal wave of popular sentiment — enough to unseat not only Tea Partiers but some of their lobbyist replacements– before any such think can happen.  But Trusts and Corporations were broken up and new legislation put in place in the early 1900s with the help of muckraking Ida Tarbell, William Allen White, Frank Norris and others.  It can be done again.

Antibacterials = Antihealth?

Ever since the little plastic bottles with jelly-like stuff promising to keep us ultra clean and healthy began appearing I have been skeptical.  Really?  Ordinary soap and water isn’t good enough?  Really?  Paper dust on my fingers is going to make me sick?  Really?  We’ve begun to hear some doubts about these claims in the past few years, but it seems to have finally gotten some lead time…

After years of mounting concerns that the antibacterial chemicals that go into everyday items like soap and toothpaste are doing more harm than good, the Food and Drug Administration said on Monday that it was requiring soap manufacturers to demonstrate that the substances were safe or to take them out of the products altogether.

The proposal was applauded by public health experts, who for years have urged the agency to regulate antimicrobial chemicals, warning that they risk scrambling hormones in children and promoting drug-resistant infections, among other things. Producers argue that the substances have long been proved to be safe.

“It’s a big deal that they are taking this on,” said Rolf Halden, the director of the Center for Environmental Security at Arizona State University, who has been tracking the issue for years. “These antimicrobials have taken on a life all of their own,”

NY Times: Sabrina Tavernise

And that’s not all.  Not only do soaps and toothpastes promise health through bacteria bombing there are other issues with the stuff:

Tiny plastic beads used in hundreds of toiletries like facial scrubs and toothpastes are slipping through water treatment plants and turning up by the tens of millions in the Great Lakes. There, fish and other aquatic life eat them along with the pollutants they carry — which scientists fear could be working their way back up the food chain to humans.

Yes, there is such a thing as being too clean…

Sociopaths Explain

Paul Krugman has found some wildly over-the-top complaints from the richest sociopaths in America.

Robert Benmosche, the chief executive of the American International Group [AIG — you remember that?]  “compared the uproar over [executive] bonuses to lynchings in the Deep South — the real kind, involving murder — and declared that the bonus backlash was “just as bad and just as wrong.”

 

Oh, there’s more!

Trackers Trackers Everywhere

It’s not just the government which is tracking you

One, RetailNext, uses video footage to study how shoppers navigate, determining, say, that men spend only one minute in the coat department, which may help a store streamline its men’s outerwear layout. It also differentiates men from women, and children from adults.

RetailNext, based in San Jose, Calif., adds data from shoppers’ smartphones to deduce even more specific patterns. If a shopper’s phone is set to look for Wi-Fi networks, a store that offers Wi-Fi can pinpoint where the shopper is in the store, within a 10-foot radius, even if the shopper does not connect to the network, said Tim Callan, RetailNext’s chief marketing officer.

The store can also recognize returning shoppers, because mobile devices send unique identification codes when they search for networks. That means stores can now tell how repeat customers behave and the average time between visits.

NY Times

For all the consternation at the Snowden revelations of government collection of meta-data there has been little comment on similar corporate data collection. For my money this is a set of evil twins and I’m not sure at all which is more intrusive of our liberty and privacy: that which is, here and now, aiming to shape our every waking hour or that which may sweep us  into a life disrupting investigation. People are rightly worried about the latter but the former is constant, and insidious and even, to some extent, participatory.  There is a kind of magic in the ads appearing for shoes when that is what we are interested in; we appreciate a store layout that directs us to exactly what we want.  Our expectations and our lives become shaped by this. We want to live in the warm cocoon of perfect knowledge and satisfaction of our desires. There is a peverse pleasure in being known completely, a pleasure which obscures the realization that we are under constant watch, by others, for their own purposes.

Regulations and Air Craft Safety

In an opinion piece today in the SF Chronicle Robert A Clifford, a Chicago litigator of air crash victims, inveighs against the FAA for not implementing recommendations of the NTSB to require air-speed warning devices on aircraft — the cause of the Asian crash in San Francisco, though the cause of that low speed is still not known.

Such devices would likely be useful.  Let’s get it done. However, what strikes me as odd is that his ire is directed at the federal bureau which, by requiring the devices, would surely raise howled objections from those who don’t like regulation, and invite lobbyists of the powerful airlines industry to descend from their perches and foul the floors of congress.

Why not address this call to the airline manufacturers themselves: the Boeing, Lockeed and Airbus designers?  Surely the installation of such devices, the technology for which exists, can not be a major problem, cannot cost very much money.

As is usual, this is why there is regulation — because those who can and should do the right thing will not and do not do it.

For shame.

 

Supreme Court Rules Human Genes May Not be Patented

The occasional good news surfaces

 

The Supreme Court ruled unanimously Thursday that human genes cannot be patented, a decision that could shape the future of medical and genetic research and have profound effects on pharmaceuticals and agriculture.

It’s not a full bore win.  Synthetic DNA is patentable, but the ACLU, which brought the case, is celebrating.

The case arose when a group of medical researchers, associations and patients – represented by the American Civil Liberties Union – filed suit in 2009, saying human genes, including synthetically produced material, should not be patented.

They challenged seven patents owned by or licensed to Myriad on two genes – called BRCA1 and BRCA2 – linked to breast and ovarian cancer. A federal judge said the patents were invalid. An appeals court overruled that decision, and the case landed at the Supreme Court.

“Today, the court struck down a major barrier to patient care and medical innovation,” said Sandra Park of the ACLU Women’s Rights Project. “Myriad did not invent the BRCA genes and should not control them. Because of this ruling, patients will have greater access to genetic testing and scientists can engage in research on these genes without fear of being sued.”  Reuters

Cops Sent to Arrest Illegal Seed Users

In more stunning news of corporate thuggery, and a screaming siren about the abuse of ‘intellectual property,’ Dupont is sending cops to ferret out illegal use of its ‘patented’ seeds.  No longer can a farmer save a portion of his crop for seeding the next year.  If he has Dupont or Monsanto seeds he’s got to pay up every year — like a software license.

By Jack Kaskey – Nov 28, 2012 1:14 PM PT

DuPont Co. (DD), the world’s second- biggest seed company, is sending dozens of former police officers across North America to prevent a practice generations of farmers once took for granted.

The provider of the best-selling genetically modified soybean seed is looking for evidence of farmers illegally saving them from harvests for replanting next season, which is not allowed under sales contracts. The Wilmington, Delaware-based company is inspecting Canadian fields and will begin in the U.S. next year, said Randy Schlatter, a DuPont senior manager.

…Attacks on the modified food industry aren’t new. Farmers criticized Monsanto in the 2008 Oscar-nominated documentary “Food, Inc.” for contracts that keep them from saving seeds. The St. Louis-based company has sued 145 U.S. farmers for saving Roundup Ready soybeans since 1997, winning all 11 cases that went to trial, said Kelli Powers, a Monsanto spokeswoman. The U.S. Supreme Court last month agreed to consider the legality of such planting restrictions.

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Maybe this will encourage at least the smaller growers to stop buying the GM seeds and return to practices more in keeping with economic and ecological sense.  There’s got to be a better way than Round Up to keep pests low and productivity high.

 

Offshoring, Outsourcing — A Distinction Without a Difference

Paul Krugman helps us through the latest Romney obfuscation as he tries to mezmerize his way to the presidency:

the [Romney]  campaign’s insiste[ed] that The Post had misled readers by failing to distinguish between “offshoring” — moving jobs abroad — and “outsourcing,” which simply means having an external contractor perform services that could have been performed in-house.

Now, if the Romney campaign really believed in its own alleged free-market principles, it would have defended the right of corporations to do whatever maximizes their profits, even if that means shipping jobs overseas. Instead, however, the campaign effectively conceded that offshoring is bad but insisted that outsourcing is O.K. as long as the contractor is another American firm.

That is, however, a very dubious assertion.

… one of the main points of outsourcing is to ensure that as little as possible of what corporations earn goes into the pockets of the people who actually work for those corporations.

Why, for example, do many large companies now outsource cleaning and security to outside contractors? Surely the answer is, in large part, that outside contractors can hire cheap labor that isn’t represented by the union and can’t participate in the company health and retirement plans. And, sure enough, recent academic research finds that outsourced janitors and guards receive substantially lower wages and worse benefits than their in-house counterparts.

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