The Policy Bedrock of a True New Deal

Felicia Wong in Boston Review:

4. Federal Charters for Corporations

The relationship between corporations and the American public is broken. In good times, companies reward executives and shareholders, and in bad times, companies expect and receive bailouts. Workers are rarely the beneficiaries, but it doesn’t have to be this way.

Corporations derive their very existence—and the special advantages that come with it, like limited liability for shareholders—from the government. But for the last five decades they have steadily strayed from behavior that builds shared prosperity toward practices that maximize profit extraction and prioritize short-term profits over long-term stability. U.S. corporations started to shift toward this “shareholder value maximization” approach in the 1980s. Instead of balancing the needs of all their stakeholders, corporations focused narrowly on sending as much money as possible to shareholders. That shift contributed to a variety of economic harms: wage stagnation for workers, declining long-term investments and innovation, and slowing worker productivity.

More here.