spread of share-ownership

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pages: 273 words: 34,920

Free Market Missionaries: The Corporate Manipulation of Community Values by Sharon Beder

anti-communist, battle of ideas, business climate, corporate governance, en.wikipedia.org, full employment, income inequality, invisible hand, liquidationism / Banker’s doctrine / the Treasury view, minimum wage unemployment, Mont Pelerin Society, new economy, old-boy network, popular capitalism, Powell Memorandum, price mechanism, profit motive, Ralph Nader, rent control, risk/return, road to serfdom, Ronald Reagan, school vouchers, shareholder value, spread of share-ownership, structural adjustment programs, The Chicago School, the market place, The Wealth of Nations by Adam Smith, Thomas L Friedman, Torches of Freedom, trade liberalization, traveling salesman, trickle-down economics, Upton Sinclair, Washington Consensus, wealth creators, young professional

Likewise, in Australia a couple of years later, as the number of Australian shareholders increased, the ABC news had replaced its sports anchorperson with a business reporter, and the best-selling book was Rich Dad, Poor Dad, which was about how to make money through investment. John Budd, ABC’s national editor, called business and finance ‘the main participation sport for most Australians’.15 In addition, finance programmes were increasingly featured on popular television channels.16 Adele Horin in the Sydney Morning Herald noted: The spread of share ownership to the middle class is changing how we spend our time, what we talk about, celebrate, worry about. It has even changed what we watch on television . . . The perspective of a shareholder is different from that of a citizen without a portfolio. Mesmerised shareholders can begin to believe rising unemployment is good because it boosts share prices, and applaud a tax system that continues to treat shares and dividends far more favourably than wages.

Thomas Frank points out that: ‘Belief that a democratic system functions may provide a false sense of comfort to the public, to wit, that the managers – who, after all, exercise substantial power over our lives – are responsive to a governance process that we understand from another context.’6 By representing shares as the major source of wealth of a nation’s elites and showing that this route to wealth is accessible to anyone, the inequality produced by the free market is legitimized. Shares are portrayed as a major mechanism for wealth sharing and widening social inclusiveness. Pension and superannuation schemes, managed funds and employee share schemes give working people access to this route to riches and enable business people and financial journals to extol the spread of share ownership as a sign that capitalism is indeed benefiting everyone. However, it is a distorted picture that business interests paint, because ownership of a few shares in a mutual fund is not a route to wealth. As share prices rose in the 1990s, it was the wealthy people, who owned most of the shares already, who became wealthier. A US Federal Reserve study found that as the share market boomed between 1998 and 2001 the net worth of the top 10 per cent of families increased by 69 per cent ($833,600), while the net worth of the lowest 20 per cent only rose by 24 per cent ($7900).7 Similarly, despite widening share ownership in Australia, inequalities have increased.


pages: 234 words: 53,078

The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer by Dean Baker

accounting loophole / creative accounting, affirmative action, Asian financial crisis, Bretton Woods, business cycle, corporate governance, declining real wages, full employment, index fund, Jeff Bezos, medical malpractice, medical residency, money market fund, offshore financial centre, price discrimination, risk tolerance, spread of share-ownership

This is essential, and, as noted earlier, is for the benefit of the corporations themselves. No one would buy shares in a corporation if he or she thought that the management was free to simply steal their money. For a variety of reasons, the mechanisms that once placed a check on the ability of corporate management to pilfer money for its own use have broken down. This may be partly attributable to the spread of share ownership, so that instances where a single family maintains control of a major corporation (and therefore can keep its management in line) are less common. It may also be partly attributable to changing morals in the larger society, so that unchecked greed is more acceptable. But the causes of the breakdown don’t matter as much as the remedies. And the most effective remedies are changing the rules to ensure that CEO power is held in check.


pages: 267 words: 79,905

Creating Unequal Futures?: Rethinking Poverty, Inequality and Disadvantage by Ruth Fincher, Peter Saunders

barriers to entry, ending welfare as we know it, financial independence, full employment, Gini coefficient, income inequality, income per capita, labour market flexibility, labour mobility, longitudinal study, low skilled workers, low-wage service sector, marginal employment, minimum wage unemployment, New Urbanism, open economy, pink-collar, positional goods, purchasing power parity, shareholder value, spread of share-ownership, The Bell Curve by Richard Herrnstein and Charles Murray, urban planning, urban renewal, very high income, women in the workforce, working poor, working-age population

The secondary investment circuit identified by Froud and her colleagues is responsible for intensifying inequality and unstable labour demand. This occurs because ‘shareholder value’ is the dominant criterion guiding saving and investment. The pursuit of shareholder value causes endless restructures and cost shifting exercises which adversely affect the workforce. Far from solving the problem, the spread of share ownership and of privately based superannuation actually destabilises the situation further. As Froud and her colleagues put it: what we have is a Keynesian paradox about the unequal society where the pursuit of individual security through investment in the capital market spreads collective insecurity through labour market redundancy and reemployment which is part of restructuring. (Froud et al. 1998, p. 25) Combining this innovative British research with our earlier analysis sheds important light on the problem of low-paid jobs.


pages: 613 words: 151,140

No Such Thing as Society by Andy McSmith

anti-communist, Ayatollah Khomeini, Berlin Wall, Big bang: deregulation of the City of London, Bob Geldof, Boris Johnson, British Empire, Brixton riot, call centre, cuban missile crisis, Etonian, F. W. de Klerk, Farzad Bazoft, feminist movement, fixed income, Francis Fukuyama: the end of history, friendly fire, full employment, glass ceiling, God and Mammon, greed is good, illegal immigration, index card, John Bercow, Kickstarter, liberal capitalism, light touch regulation, Live Aid, loadsamoney, long peace, means of production, Mikhail Gorbachev, mortgage debt, mutually assured destruction, negative equity, Neil Kinnock, Nelson Mandela, North Sea oil, Northern Rock, old-boy network, popular capitalism, Right to Buy, Ronald Reagan, Rubik’s Cube, Sloane Ranger, South Sea Bubble, spread of share-ownership, strikebreaker, The Chicago School, union organizing, upwardly mobile, urban decay, Winter of Discontent, young professional

The chairman, Sir John Read, and the board gave earnest undertakings that the historic links with the Trustee Savings Bank movement and the company’s Scottish identity would both be preserved. Having converted, TSB bought another bank, Hill Samuel, just before the stock market crashed in 1987. Three desperate years later, despite all the promises made before the flotation, it closed the separate Scottish operation. In 1995, TSB was taken over by Lloyds. But these problems lay in the future. At the time, the flotation of Abbey National was one more development in the spread of share-ownership that began with the sale of British Telecom. The Thatcher government stumbled on this, its f agship policy, rather late. Before 1983, it sold off bits and pieces of state-owned enterprises, including 51 per cent of British Aerospace, Cable and Wireless and Britoil, a company created by the Labour government to produce and sell oil from the North Sea. The last of these was the biggest sale by far and bombed badly when the price of oil dropped abruptly – about 70 per cent of the available shares went unsold.