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Capitol Confidential and Jim Hoft have done an excellent job laying out concerns with the potential “compromise” bill that comes out of Sen. Bob Corker’s negotiations with Chris Dodd. But when it comes to the destructive provisions that could come out of a Dodd-Corker deal, they may have just scratched the surface.
In addition to the troubling new powers for a new nanny-state consumer agency and possibly the Federal Reserve added to the prospect of billions more in bailouts for reckless financial firm, the bill may also contain the sneaky “proxy access” power grab for unions, radical environmentalists, and other groups on the Left. This rule, inspired by Saul Alinsky’s Rules for Radicals, is contained in Dodd’s “discussion draft” bill from late last year.
As I detailed in BigGovernment last week, “proxy access would federalize and override decades of state law governing the structure of corporations and force publicly-traded companies to put shareholders’ nominees for a board of directors on a company’s proxy ballot along with the firm’s own nominees for those positions.” Many shareholder groups that are pushing this are union pension funds, the radical Tides Foundation, and other progressive groups — from animal rights to anti-Israel — who place their own political agenda items at the expense of ordinary shareholders.
Even if these groups’ nominees do not get elected as directors, they could use the threat of a campaign – which the company and other shareholders would be forced to subsidize – “as a lever to force U.S. companies to bow to the Left’s wish list on every policy from “card check” that would end secret ballot for union elections to cap-and-trade rationing of electricity to a silencing of conservative voices by small group of ideological shareholders who would have veto power over the content of a media company.” Indeed, proxy access could also serve as a type of Fairness Doctrine-rule in which progressive shareholders of media companies attempt to block conservative content, as now-disgraced New York Comptroller Alan Hevesi did when Sinclair Broadcasting was going to air the “Stolen Honor” documentary critical of John Kerry.
As I documented in the article, proxy access has its roots in the “proxy tactic” that community organizer Alinksy outlined in his Rules for Radicals. In that handbook, Alinsky called for progressive groups to utilize shareholder proxies as “the razor to cut through the golden curtain that protected the so-called private sector from facing its public responsibilities.” Alinsky admitted that this tactic “will result in diminished dividends” for middle-class investors, but said that it was necessary to fool the middle class to “build power for change.”
But on the debate on health care and other issues pushed by progressives, the middle-class is showing that it isn’t fooled as easily as Alinsky and his followers though they could be. It remains to be seen, though, whether the proxy tactic will fool Corker, or whether he will be educated on this and other forms of “corporate jujitsu”(Alinksy’s own words) by the legions of savvy middle-class investors and entrepreneurs.
On that note, I am happy to report that leaders of 17 groups representing a broad spectrum of the Center-Right coalition — from my organization Competitive Enterprise Institute and Americans for Tax Reform to the Christian Coalition of America — have sent a letter to Dodd, Banking Committee Ranking Member Richard Shelby (R-Ala.) and Corker expressing objections to proxy access. Such a rule, the letter states, “would benefit special interests with political agendas at the expense of ordinary shareholders” and “would allow … activists to achieve through the board nomination process what they have been unable to accomplish through the political process.” The letter is printed below and also available here.