Citizens Lose Power as Corporations Buyback Stock

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Citizens Lose Power as Corporations Buyback

Corporations are “spending record sums repurchasing their own stock” so says the Wall Street Journal.

What happens when buyback happens? I suspect many things happen when this happens; one important thing that happens is that corporate management gains greater power.

Great power in America resides in America’s large institutions. “Power is not an attribute of individuals, but of social organizations.” Power is the potential to control. You have power over me when you have the potential to thwart my self-determination and to cause me to be determined by you.

In society most power lies within the roles an individual has rather than in the individual as a single entity. Few corporations are owned primarily by single families. The power residing in big corporations is exercised by management. The less the stock holding by the public the more power is in the hands of managers. With buybacks the power of management is enhanced.

A democratic form of government is one wherein the citizens have some voice in some policy decisions; the greater the voice of the citizens the better the democracy. As management power increases democracy is weakened.

In America we have policy makers, decision makers, and citizens. The decision makers are our elected representatives and are, thus, under some control by the voting citizen. The policy makers are the leaders of American institutions; less than ten thousand individuals, according to those who study such matters. Policy makers exercise significant control of decision makers by controlling the financing of elections.

Policy makers customize and maintain the dominant ideology in order to control the political behavior of the citizens. This dominant ideology exercises the political control of the citizens in the same fashion as the consuming citizen is controlled by the same dominant ideology.

“Thomas R. Dye, Professor of Political Science at Florida State University, has published a series of books examining who and what institutions actually control and run America. To understand who is making the decisions that affect our lives, we also have to understand how societies structure themselves in general. Why the few always tend to share more power than the many and what this means in terms of both a society’s evolution and our daily lives. They examined the other 11 institutions that exert just as powerful a shaping influence, although somewhat more subtle: The Industrial, Corporations, Utilities and Communications, Banking, Insurance Investment, Mass Media, Law, Education Foundation, Civic and Cultural Organizations, Government, and the Military.”
21stcenturyradio.com/12-dye.html

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I dont think this is necessarily a bad thing.

People who are decision makers at corporations are not all greedy unethical people despite the current perception. The fact that they would have greater power in making decisions is a good thing I believe because public shareholders are mostly investors interested only in the bottom line, and notably disinterested in how a corporation achieves that bottom line. This puts pressure on corporate decision-makers to make the projections no matter what, which leads to less than ethical behavior.

The people at the top of the company are more often than not, regular people like you and I that want to not only grow their corporation, but do so responsibly. I should also note that this has increased since Enron, as business schools have placed more emphasis on teaching MBA students about corporate ethics.

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anvildoc

My observation is apparently different than yours. Thomas Dye has written a series of books focusing on the question “Who Runs America”. His books are enlightening. But one does not have to read books to develop some comprehension of who runs America.

The American Institutions who control greater than 50% of the power in America are in turn controlled by less than 10,000 persons. Many of our major institutions from Banks, to corporations are controlled by a few individuals often an interlocking control. That is, many sit on multiply boards and exercise control over more than one institution.

Knowing human nature and using the method of ‘follow the money’ I think that one can easily discover who very well might control public policy. Of course those who do control recognize that secrecy is vital. It is like a bullfight, the Matador must not let the bull focus attention on the Matador rather than the cape.

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That is an oxymoron.

He who is greedy is by definition virtuous.