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Thankfully there’s no chance this bill will ever pass with the current Congress, and even if it did, the Supreme Court would likely strike it down on account of

Thankfully there’s no chance this bill will ever pass with the current Congress, and even if it did, the Supreme Court would likely strike it down on account of state’s rights. It’s a bill trying to solve the wrong problem with the wrong solution. What value does workers electing their directors add for anybody? Firstly, the idea that director appointments should be political is patently absurd — a directorship is a job with well defined requirements and expectations, which the majority of workers are often completely unqualified to judge. Secondly, what right does the federal government have to dictate the internal governance of corporations? (Answer: explicitly none, as per the tenth amendment of the constitution.) This is such an awful, awful idea. One only needs to look at the government itself to see what happens when leaders are elected, not appointed. There’s a reason the private sector has a reputation for success and efficiency and the government does not... the idea of executives being elected by democratic process is so scary it’s almost comical. Disclaimer: I am extremely skeptical of the motives of Elizabeth Warren and hope she doesn’t come anywhere close to the White House

prolikewh0a 8y ago
>What value does workers electing their directors add for anybody? It provides workers say in what they do, since the workers do LITERALLY ALL THE WORK. The shareholders do literally no work in a quest for profit at the expense of the people who DO THE WORK. The company/business cannot survive without workers, they are the most important part. Have some solidarity for your fellow people. It's truly sickening that anyone would think workers shouldn't have any say at all and should just be useless cogs in the machine getting all representation gutted year after year so a few people can massively profit at the expense of everyone else.
- chatmasta 8y ago
  I recognize the problem, but I’m very skeptical that the solution is a democratic process to elect directors. It optimizes for the completely wrong qualities necessary for a directorship, and I could easily see it hurting the workers more than helping them. What I find amusing is that the same people who support this bill are upset that Trump was elected through a democratic process. Many of these supporters would say the democratic process failed the American people. So why would they want to apply the same framework to corporate governance? It seems a bit hypocritical to be honest. The workers are free to start their own company whenever they want, btw.
  - maym86 8y ago
    > It optimizes for the completely wrong qualities necessary for a directorship, and I could easily see it hurting the workers more than helping them. No it doesn't (see other people can make completly unqualified statements too).
    - chatmasta 8y ago
      If the past election cycle has taught us anything, it’s that experience and job qualifications have little correlation with popularity. Basically Warren is advocating for director appointment via popularity contest. Can you really argue that the average Walmart employee, for example, has the necessary information to make the right decision on who should be COO of Walmart? It reduces the process of choosing directors to a contest of who can make the most empty promises to employees.
      - maym86 8y ago
        So you're arguing against all democracy? If there are regular votes to keep/replace this director if they are not performing to the benefit of the workers I don't see an issue. Sure they're will be some bad choices sometimes but the existence of the position in itself will exert some pressure to consider worker issues that the company didn't have to think about before. Treating low paid workers as interchangeable, disposable resources needs to change and this is a very small step towards giving them a little more control of their situation. It's not perfect but it's better.
        chatmasta 8y ago
        No, I’m arguing against applying democracy as a solution to any problem that seems too hard to solve. “Fuck it, we’ll vote on it!” is a lazy solution.
        maym86 8y ago
        > “Fuck it, we’ll vote on it!” is a lazy solution. It's a far better solution than no option at all. If people make a bad choice they'll just be back to where they started, with people in charge who care little about their welfare.
- alexgmcm 8y ago
  But the current model is that you are just a human resource, little different than the desk you sit at. They don't ask the machines in the factories how the company should be run and thus why would they ask the workers? You are essentially company property - they have bought your time. It's a sad state of affairs as it probably causes a great deal of workers to become alienated and disillusioned with their work.
  - maym86 8y ago
    That's the point. Treating low paid workers as interchangeable, disposable resources needs to change and this is a small step towards giving them a little more control of their situation.
- tepidandroid 8y ago
  This is such an emotional response. It's not about who does the work. It never has been about who does the work. It's about who takes on the initial burden of risk and what kind of compensation that risk demands. A worker takes on little to no risk when offering his/her labour in return for a steady salary. An entrepreneur taking on massive amounts of leverage can be completely ruined when that venture fails. There is nothing to stop a worker from quitting their job and taking on the risk of starting their own business. It happens all the time and if they succeed, they deserve to reap the rewards. If a worker chooses the safe path, they cannot then in good faith argue that they now deserve a bigger piece of the pie just because the enterprise has succeeded. Life does not work that way.
  - chatmasta 8y ago
    I’m a big proponent of this argument and often repeat it myself. However, it is worth considering that it only applies to founder level executives who were there at the beginning. For a 100+ year old company like GE, the argument falls apart as the original founders are not around anymore and most employees have taken the same amount of risk (or lack thereof).
  - prolikewh0a 8y ago
    >It's about who takes on the initial burden of risk and what kind of compensation that risk demands. A worker takes on little to no risk when offering his/her labour in return for a steady salary. Who takes more risk, the worker standing 70 stories up on an I-beam with no health insurance or life insurance (couldn't afford it!), or the guy who borrowed money to start a business? Who creates the profit that allows the owner to pay back that loan? Who dug the metal out of the ground? Oh, right, it all comes back to the worker. Workers risk their lives and livelihood. The worker takes on just as much risk, if not more, especially with 80% of our country living paycheck to paycheck. Let me know how you start a business on $7.25/hr?
    - dragonwriter 8y ago
      > Who takes more risk, the worker standing 70 stories up on an I-beam with no health insurance or life insurance (couldn't afford it!), or the guy who borrowed money to start a business? In the capitalist value system, the latter: he might lose (temporarily, at least) his credit rating and ability to acquire capital if the venture fails; all the other guy is going to lose is the life of a worker, and who cares about that?
- MR4D 8y ago
  You do have a say, and companies already answer to more than just their shareholders. See [0] for instance: “In recent years, large technology companies have been investigated for colluding with a secret agreement not to hire one another’s best workers; **fined billions** of dollars for unfairly favoring certain services on their platforms over other rivals; and been accused of mishandling sensitive consumer information or of obtaining new customers under false pretenses,” So this naive idea that companies run amok without recourse is political theatre in the clothing of concern. Finally, and I hate to bring this up, but if you don't like it, then quit. That's what I did to start a business. It's tough and it's stressful, and some days are just no fun at all and I wonder what the heck I did. But it's my company, and I only answer to my clients. Yes, I am the shareholder, but honestly, what's in my best interest is serving my clients better than my competition. I am the labor and the shareholder. Yes, it comes with issues, but so does everything. If you don't like the control a company has over you, then leave. And before anyone says "I can't leave because....", remember, if you get fired, you've still left, and you still have to deal with those same "..." issues. So yes, you can leave. It may be uncomfortable as hell, but you can. You'll be amazed at how hard you will work for a single dollar when it's your own firm. I've never worked this hard for another company. Ever. [0] https://www.washingtonpost.com/blogs/right-turn/wp/2018/07/27/sen-elizabeth-warren-responds-to-our-invitation-to-discuss-policy-part-1/?utm_term=.3768c6a0a72f https://www.washingtonpost.com/blogs/right-turn/wp/2018/07/2...
  - mfringel 8y ago
    I'm glad that worked for you.
  - philipodonnell 8y ago
    > Finally, and I hate to bring this up, but if you don't like it, then quit. That's what I did to start a business. Technology workers who are able to start their own contracting company are a tiny minority of the employed population. To claim everyone has this option and thus should not attempt to affect change at their employer or exercise their power to vote for representatives who enact worker-friendly policies, is naive at best and insulting at worst. IMHO, this perspective is everything that's wrong with the Silicon Valley mindset. I got mine so f* you if you can't do exactly the same thing as I did.
- dang 8y ago
  Please don't use allcaps for emphasis, regardless of how strongly you feel. It's basically online yelling. This is in the site guidelines: https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html. Also, rant tropes like "it's truly sickening" aren't a good fit here, and fall under what the site guidelines refer to as name-calling. The idea on HN is to make a substantive point thoughtfully, which sometimes requires waiting until the heat of the moment subsides a bit.
- zaroth 8y ago
  > It's truly sickening that anyone would think... I think discussion would be improved with a less polarizing approach. This is just hyperbole.
  - lucretian 8y ago
    there is a moral valence to this topic, and that ought to be expressed somehow.
lucretian 8y ago
supremely disappointing to see such a poorly substantiated comment upvoted this highly. What value does workers electing their directors add for anybody? the value is articulated in the original op-ed. among other things, reducing income inequality which is important from a societal perspective. the idea that director appointments should be political is patently absurd they are already political, just in a very one-sided fashion. a directorship is a job with well defined requirements and expectations defined by the owner / capitalist class. the job can be redefined. the majority of workers are often completely unqualified to judge very arrogant to assume that workers do not understand their own priorities or that those things shouldn't matter. the rest of the comment is composed of regurgitated talking points. edit: disclosure - ex-vc and current business owner
- chatmasta 8y ago
  I wasn’t implying that workers are incapable of judging who the best candidate for a director level job is. Rather, I was suggesting that they do not have the information necessary to make a defensible decision. Therefore, like all elections, the process is reduced to popularity contest where employees could just as easily vote for a candidate who is detrimental to their interests without even realizing it.
  - dragonwriter 8y ago
    I dont see how that is any less true of the mass of public stockholders. (Or, he citizens of a democratic state.) Yes, people with voting power can make mistaken decisions that are contrary to their interests. Giving all of the voting power to people whose interests are systematically and fundamentally in conflict with the group at issue on many points does not, however, reduce the likelihood of adverse decisions being imposed on them.
    - chatmasta 8y ago
      One difference is that you can always quit the company you work for (which you voluntarily joined in the first place); it’s not so easy to leave your country, nor did you have any choice in where you were born.
spadros 8y ago
Eh, I don't think CEO's should get 361X the normal employee. I think 42X was already insane. $250 billion towards shareholders vs $7 trillion is also insane. Workers just arn't getting compensated the same now as they were in the 70s. Worker quality of life should get better as time goes on, not worse. So I'd support anything that aims to even out that ludicrous greed filled gap.
- tepidandroid 8y ago
  I've never understood the argument for capping CEO salaries. It's simply how the free market works. Supply and demand. There is only a narrow pool of candidates for CEO positions that can command that kind of compensation. Why do they command that compensation? Because the potential value they bring to the company is worth far more. Sometimes it really is that simple.
  - kerbalspacepro 8y ago
    The argument is that CEO salaries aren't actually determined by supply and demand, and that the uncertainties are so prevalent that any attempt at valuation is certainly made up. It comes down to more interpersonal networks, relationships, and power then it does analytical rigor. At least, that's the argument.
    - tepidandroid 8y ago
      Understood. IMO, the argument is moot though because at the end of the day, the sole determinant of valuation is what someone else is willing to pay. A highly connected CEO with many high powered relationships is valued very highly because as it turns out, those are the things needed for a corporation to succeed.
      - craftyguy 8y ago
        A corporation needs MUCH more than the CEO's relationship with his/her friends/connections to succeed.
      - 8y ago
prometheuspk 8y ago
The best way to accomplish all this is to re-strengthen labor unions, but make it explicit that they do not engage in political contributions/campaigns etc.
- roguecoder 8y ago
  Are businesses required not engage in political contributions or campaigns? Why would unions be different?
andromedavision 8y ago
I love you. I love your comment.
TrevorAustin 8y ago
Seems unlikely there will be tenth amendment problems. It's pretty hard to do over a billion dollars in revenue without operating across state lines.
anonu 8y ago
So what are you suggestions on fixing the problem? I'm assuming you think there is no problem to start with... We don't exactly have unfettered capitalism in the US. Corporations are successful because the government stimulates demand in certain areas, creates incentives for people to do certain things (buy electric cars or grow corn for ethanol) and as the article points out, provides a charter to corporations to operate. We have antitrust laws that promote healthy competition to protect the consumer... I think her proposal is not overreaching... it still allows the market and shareholders to determine where a company is headed...

prolikewh0a 8y ago

>What value does workers electing their directors add for anybody? It provides workers say in what they do, since the workers do LITERALLY ALL THE WORK. The shareholders do literally no work in a quest for profit at the expense of the people who DO THE WORK. The company/business cannot survive without workers, they are the most important part. Have some solidarity for your fellow people. It's truly sickening that anyone would think workers shouldn't have any say at all and should just be useless cogs in the machine getting all representation gutted year after year so a few people can massively profit at the expense of everyone else.

chatmasta 8y ago
I recognize the problem, but I’m very skeptical that the solution is a democratic process to elect directors. It optimizes for the completely wrong qualities necessary for a directorship, and I could easily see it hurting the workers more than helping them. What I find amusing is that the same people who support this bill are upset that Trump was elected through a democratic process. Many of these supporters would say the democratic process failed the American people. So why would they want to apply the same framework to corporate governance? It seems a bit hypocritical to be honest. The workers are free to start their own company whenever they want, btw.
- maym86 8y ago
  > It optimizes for the completely wrong qualities necessary for a directorship, and I could easily see it hurting the workers more than helping them. No it doesn't (see other people can make completly unqualified statements too).
  - chatmasta 8y ago
    If the past election cycle has taught us anything, it’s that experience and job qualifications have little correlation with popularity. Basically Warren is advocating for director appointment via popularity contest. Can you really argue that the average Walmart employee, for example, has the necessary information to make the right decision on who should be COO of Walmart? It reduces the process of choosing directors to a contest of who can make the most empty promises to employees.
    - maym86 8y ago
      So you're arguing against all democracy? If there are regular votes to keep/replace this director if they are not performing to the benefit of the workers I don't see an issue. Sure they're will be some bad choices sometimes but the existence of the position in itself will exert some pressure to consider worker issues that the company didn't have to think about before. Treating low paid workers as interchangeable, disposable resources needs to change and this is a very small step towards giving them a little more control of their situation. It's not perfect but it's better.
      - chatmasta 8y ago
        No, I’m arguing against applying democracy as a solution to any problem that seems too hard to solve. “Fuck it, we’ll vote on it!” is a lazy solution.
        maym86 8y ago
        > “Fuck it, we’ll vote on it!” is a lazy solution. It's a far better solution than no option at all. If people make a bad choice they'll just be back to where they started, with people in charge who care little about their welfare.
alexgmcm 8y ago
But the current model is that you are just a human resource, little different than the desk you sit at. They don't ask the machines in the factories how the company should be run and thus why would they ask the workers? You are essentially company property - they have bought your time. It's a sad state of affairs as it probably causes a great deal of workers to become alienated and disillusioned with their work.
- maym86 8y ago
  That's the point. Treating low paid workers as interchangeable, disposable resources needs to change and this is a small step towards giving them a little more control of their situation.
tepidandroid 8y ago
This is such an emotional response. It's not about who does the work. It never has been about who does the work. It's about who takes on the initial burden of risk and what kind of compensation that risk demands. A worker takes on little to no risk when offering his/her labour in return for a steady salary. An entrepreneur taking on massive amounts of leverage can be completely ruined when that venture fails. There is nothing to stop a worker from quitting their job and taking on the risk of starting their own business. It happens all the time and if they succeed, they deserve to reap the rewards. If a worker chooses the safe path, they cannot then in good faith argue that they now deserve a bigger piece of the pie just because the enterprise has succeeded. Life does not work that way.
- chatmasta 8y ago
  I’m a big proponent of this argument and often repeat it myself. However, it is worth considering that it only applies to founder level executives who were there at the beginning. For a 100+ year old company like GE, the argument falls apart as the original founders are not around anymore and most employees have taken the same amount of risk (or lack thereof).
- prolikewh0a 8y ago
  >It's about who takes on the initial burden of risk and what kind of compensation that risk demands. A worker takes on little to no risk when offering his/her labour in return for a steady salary. Who takes more risk, the worker standing 70 stories up on an I-beam with no health insurance or life insurance (couldn't afford it!), or the guy who borrowed money to start a business? Who creates the profit that allows the owner to pay back that loan? Who dug the metal out of the ground? Oh, right, it all comes back to the worker. Workers risk their lives and livelihood. The worker takes on just as much risk, if not more, especially with 80% of our country living paycheck to paycheck. Let me know how you start a business on $7.25/hr?
  - dragonwriter 8y ago
    > Who takes more risk, the worker standing 70 stories up on an I-beam with no health insurance or life insurance (couldn't afford it!), or the guy who borrowed money to start a business? In the capitalist value system, the latter: he might lose (temporarily, at least) his credit rating and ability to acquire capital if the venture fails; all the other guy is going to lose is the life of a worker, and who cares about that?
MR4D 8y ago
You do have a say, and companies already answer to more than just their shareholders. See [0] for instance: “In recent years, large technology companies have been investigated for colluding with a secret agreement not to hire one another’s best workers; **fined billions** of dollars for unfairly favoring certain services on their platforms over other rivals; and been accused of mishandling sensitive consumer information or of obtaining new customers under false pretenses,” So this naive idea that companies run amok without recourse is political theatre in the clothing of concern. Finally, and I hate to bring this up, but if you don't like it, then quit. That's what I did to start a business. It's tough and it's stressful, and some days are just no fun at all and I wonder what the heck I did. But it's my company, and I only answer to my clients. Yes, I am the shareholder, but honestly, what's in my best interest is serving my clients better than my competition. I am the labor and the shareholder. Yes, it comes with issues, but so does everything. If you don't like the control a company has over you, then leave. And before anyone says "I can't leave because....", remember, if you get fired, you've still left, and you still have to deal with those same "..." issues. So yes, you can leave. It may be uncomfortable as hell, but you can. You'll be amazed at how hard you will work for a single dollar when it's your own firm. I've never worked this hard for another company. Ever. [0] https://www.washingtonpost.com/blogs/right-turn/wp/2018/07/27/sen-elizabeth-warren-responds-to-our-invitation-to-discuss-policy-part-1/?utm_term=.3768c6a0a72f https://www.washingtonpost.com/blogs/right-turn/wp/2018/07/2...
- mfringel 8y ago
  I'm glad that worked for you.
- philipodonnell 8y ago
  > Finally, and I hate to bring this up, but if you don't like it, then quit. That's what I did to start a business. Technology workers who are able to start their own contracting company are a tiny minority of the employed population. To claim everyone has this option and thus should not attempt to affect change at their employer or exercise their power to vote for representatives who enact worker-friendly policies, is naive at best and insulting at worst. IMHO, this perspective is everything that's wrong with the Silicon Valley mindset. I got mine so f* you if you can't do exactly the same thing as I did.
dang 8y ago
Please don't use allcaps for emphasis, regardless of how strongly you feel. It's basically online yelling. This is in the site guidelines: https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html. Also, rant tropes like "it's truly sickening" aren't a good fit here, and fall under what the site guidelines refer to as name-calling. The idea on HN is to make a substantive point thoughtfully, which sometimes requires waiting until the heat of the moment subsides a bit.
zaroth 8y ago
> It's truly sickening that anyone would think... I think discussion would be improved with a less polarizing approach. This is just hyperbole.
- lucretian 8y ago
  there is a moral valence to this topic, and that ought to be expressed somehow.

lucretian 8y ago

supremely disappointing to see such a poorly substantiated comment upvoted this highly. What value does workers electing their directors add for anybody? the value is articulated in the original op-ed. among other things, reducing income inequality which is important from a societal perspective. the idea that director appointments should be political is patently absurd they are already political, just in a very one-sided fashion. a directorship is a job with well defined requirements and expectations defined by the owner / capitalist class. the job can be redefined. the majority of workers are often completely unqualified to judge very arrogant to assume that workers do not understand their own priorities or that those things shouldn't matter. the rest of the comment is composed of regurgitated talking points. edit: disclosure - ex-vc and current business owner

chatmasta 8y ago
I wasn’t implying that workers are incapable of judging who the best candidate for a director level job is. Rather, I was suggesting that they do not have the information necessary to make a defensible decision. Therefore, like all elections, the process is reduced to popularity contest where employees could just as easily vote for a candidate who is detrimental to their interests without even realizing it.
- dragonwriter 8y ago
  I dont see how that is any less true of the mass of public stockholders. (Or, he citizens of a democratic state.) Yes, people with voting power can make mistaken decisions that are contrary to their interests. Giving all of the voting power to people whose interests are systematically and fundamentally in conflict with the group at issue on many points does not, however, reduce the likelihood of adverse decisions being imposed on them.
  - chatmasta 8y ago
    One difference is that you can always quit the company you work for (which you voluntarily joined in the first place); it’s not so easy to leave your country, nor did you have any choice in where you were born.

spadros 8y ago

Eh, I don't think CEO's should get 361X the normal employee. I think 42X was already insane. $250 billion towards shareholders vs $7 trillion is also insane. Workers just arn't getting compensated the same now as they were in the 70s. Worker quality of life should get better as time goes on, not worse. So I'd support anything that aims to even out that ludicrous greed filled gap.

tepidandroid 8y ago
I've never understood the argument for capping CEO salaries. It's simply how the free market works. Supply and demand. There is only a narrow pool of candidates for CEO positions that can command that kind of compensation. Why do they command that compensation? Because the potential value they bring to the company is worth far more. Sometimes it really is that simple.
- kerbalspacepro 8y ago
  The argument is that CEO salaries aren't actually determined by supply and demand, and that the uncertainties are so prevalent that any attempt at valuation is certainly made up. It comes down to more interpersonal networks, relationships, and power then it does analytical rigor. At least, that's the argument.
  - tepidandroid 8y ago
    Understood. IMO, the argument is moot though because at the end of the day, the sole determinant of valuation is what someone else is willing to pay. A highly connected CEO with many high powered relationships is valued very highly because as it turns out, those are the things needed for a corporation to succeed.
    - craftyguy 8y ago
      A corporation needs MUCH more than the CEO's relationship with his/her friends/connections to succeed.
    - 8y ago

prometheuspk 8y ago

The best way to accomplish all this is to re-strengthen labor unions, but make it explicit that they do not engage in political contributions/campaigns etc.

roguecoder 8y ago
Are businesses required not engage in political contributions or campaigns? Why would unions be different?

andromedavision 8y ago

I love you. I love your comment.

TrevorAustin 8y ago

Seems unlikely there will be tenth amendment problems. It's pretty hard to do over a billion dollars in revenue without operating across state lines.

anonu 8y ago

So what are you suggestions on fixing the problem? I'm assuming you think there is no problem to start with... We don't exactly have unfettered capitalism in the US. Corporations are successful because the government stimulates demand in certain areas, creates incentives for people to do certain things (buy electric cars or grow corn for ethanol) and as the article points out, provides a charter to corporations to operate. We have antitrust laws that promote healthy competition to protect the consumer... I think her proposal is not overreaching... it still allows the market and shareholders to determine where a company is headed...