The biggest threat to the oligarchy is for the “little guy” to have a voice, any type of voice. Republicans hate when poor people, especially minorities, vote, and now they want to restrict the way we can vote with our money.
The bill, which would eliminate the banking regulations made law in 2010, as a response to the near collapse of the economy, in Dodd-Frank. As if that wasn’t bad enough, there’s an easter egg in the bill that would for all intents and purposes, silence small investors.
Under current law, any investor, as long as they own about $2,000 in stocks, has the right to attend shareholder meetings and file proposals. In other words, any investor has a voice in how a company is run. Texas Rep. Jeb Hensarling (R) chairs the House Financial Services Committee and his bill, which would replace Dodd-Frank, would also limit the number of people who have a voice to at most 100 people. Under his bill, only shareholders who own at least one percent of the company have any voice at all.
That doesn’t sound huge but think about it for a moment. Exxon is worth $392 billion. To have a voice at all, you would need to own almost $4 billion in stock. That means that if you aren’t happy with Exxon’s drilling practices, the company will tell you to screw yourself.
If you think shareholders are generally already sympathetic to the direction of any given company, you’d be wrong. There are many examples throughout history of shareholders forcing companies to do the right thing.
Here’s just one example:
Appalled by a Bloomberg Markets Magazine cover story that linked American steel company Nucor Corp. to pig iron suppliers in Brazil who used slave labor, an investment firm with a stake in Nucor called for corrective action. Their mechanism: a shareholder resolution. The proposal appeared on Nucor’s 2009 proxy statement prior to a yearly shareholder meeting — and 27 percent of the company’s shareholders voted in favor it.
Nucor stalled at first, but within a year, the steelmaker told the stakeholding company, Domini Social Investments LLC (now Domini Impact Investments) that it had begun requiring its manufacturers to sign an agreement with a group of nongovernmental organizations, including a pledge to break ties altogether with the suppliers using forced labor.
Source: IB Times
Shareholders have also been quite effective at forcing companies to be more environmentally friendly.
Just who are these soon to be disenfranchised shareholders? Well, they can be anyone with a 401K or a pension. In other words, they can be you or me.
Featured image via Zach Gibson/Getty Images
