Corporate governance and the Paramount firing of Colbert

 Peeps be getting mad about the cancellation of Colbert, since the trigger seemed to be him mocking Paramount bribing Mr. T. And that is some justified anger!

But shuffle a little of that anger to the deeper cause, which is our old friend, regulations on corporate governance.

The problem is less Paramount (though definitely boo Paramount) than the erosion and annulation of old New Deal to Great Society regulations on corporations and large enterprises.. Shareholders now rule absolutely. Stakeholders - consumers, contractors, and the general public - should have representatives on all interstate businesses, or enterprises above a certain size, measured in employees.

Now am I some goddamn expert on corporate governance? Come on, look at me! I'm a sad and shabby outsider. But our good friends over at the Roosevelt Institute have been at this a long time. Go to this article by Lenore Palladino and Kristina Karlsso. https://corpgov.law.harvard.edu/.../towards-accountable.../

They make four comparatively modest suggestions to break the stranglehold of “shareholder primacy” , also, in technical legal jargon, known as "dickheads sitting on your face forever". Here they are:

"-Boards of directors should be accountable to all stakeholders, not just shareholders. Specifically, board “fiduciary duty” should run to all stakeholders;

-Corporate purpose statements should include a requirement that corporations positively benefit society;

-Multiple stakeholders should be represented on corporate boards; and

-Large corporations should be required to charter federally,"

Those with sharp eyes will notice that the last suggestion goes all the way back to Teddy Roosevelt. In fact, Roosevelt's Progressive party pushed for an even more radical suggestion, which would have outlawed P and E splits that we are used to in the stock market today.

To quote myself from something I wrote all by myself back in the day:

There was, back in those days, a burning issue that has flamed out so much since that the very word brings an eery blank to the mind: overcapitalization. The reason this figured so heavily as a scare word among the progressives is that the era from the turn of the century to the establishment of the Interstate Commerce Commission, in 1914 – which is generally taken to bookend the progressive moment – saw the instantiation of what Lawrence Mitchell, in The Speculation Economy, claims is the founding moment of modern American capitalism: the subjugation of industry to finance. This was a moment that expressed itself on several fronts – for instance, the Courts finally cleared up the confusion about how property law applied to corporations – creating a new form of property, defined by John Commons this way: [the old common law definition] … is Property, the other is Business. The one is property in the sense of Things owned, the other is property in the sense of exchange-value of things. One is physical objects, the other is marketable assets.” [quoted by Sklar, page 50]

One of the results of this legal change, or rather, one of the reasons it came about, was that the notion of a corporation as a body issuing stock was changing. And that change brought up the charge of overcapitalization – that a corporation, instead of finding its raison d’etre in using its assets to produce a good or service on which it made a profit, was now an entity wrapped up entirely in the market for its stocks.

In 1911, a bill was voted through the House of Representatives and narrowly turned down in the Senate that would have smashed this legal structure. S. 232 built on legislative ideas already crafted during Roosevelt’s term (remember, Roosevelt was in the wings in 1911, and would run in 1912, thus ruining Taft’s chance at a second term). S. 232 would not only have required federal incorporation of all interstate businesses. Here’s Mitchell’s description of it:

“It would have replaced traditional state corporate finance law by preventing companies from issuing “new stock” for more than the cash value of their assets, addressing both traditional antitrust concerns and newer worries about the stability of the stock market by preventing overcapitalization. But it would have done much more. S. 232 was designed to restore industry to its primary role in American business, subjugating finance to its service. It would have directed the proceeds of securities issues to industrial progress by preventing corporations from issuing stock except “for the purpose of enlarging or extending the business of such corporation or for improvements or betterments”, and only with the permission of the Secretary of Commerce and Labor. Corporations would only be permitted to issue stock to finance revenue-generating industrial activities rather than finance the ambitions of sellers and promoters. … S. 232 would have restored the industrial business model to American corporate capitalism and prevented the spread of the finance combination from continuing it dominance of American industry.”

Take that, Mr. Tariffs!

So the next time you are shocked by your fave media product being canceled and censored, give a thought to corporate governance. There are many avenues to the overthrow of the plutocracy - this is one of them.