To the Editor:
On Aug. 15, Sen. Elizabeth Warren [D-Mass.] introduced the “Accountable Capitalism Act.” Aimed at state-chartered companies or affiliated groups of companies with gross receipts of $1 billion or more, the Act would require these “large entities” to obtain a separate, federal charter from the Office of United States Corporations [read: more bureaucracy].
Target companies would have a “purpose of creating a general public benefit” identified in their federal charter. “General public benefit” means “a material positive impact on society resulting from the business and operations of a United States corporation, when taken as a whole.” Three guesses who gets to decide what is or is not a general public benefit, and just imagine how stunningly subjective and subject to political whim that would be.
Also, the Act hugely redefines the duties of corporate officials: “In discharging the duties of their respective positions, and in considering the best interests of a United States corporation, the board of directors, committees of the board of directors, and individual directors of a United States corporation:
(A) shall manage or direct [its] business and affairs . . . in a manner that:
(i) seeks to create a general public benefit; and
(ii) balances the pecuniary interests of the shareholders . . . with the best interests of persons that are materially affected by the conduct of the United States corporation.”
Officers must consider not only shareholders and employees, but suppliers, customers, “community and societal factors,” and “the local and global environment” in management decisions. Just imagine how broadly those sweeping generalities can be wielded against a company, with a sword of Damocles hanging over its charter lest it offend the perceived interests of some cause célèbre or favored group du jour.
Socialism is typically understood to require that workers own the means of production. This creeping form of Socialism does not mandate such ownership, strictly speaking. For now, at least, it will settle for having all U.S.-based large entities on a potentially fatal choke collar if they do not dance to the tune of a given administration or its unelected bureaucrats.