Book Review: Citizen Capitalism: How a Universal Fund Can Provide Income and Influence to All

Corporations have been hijacked by the wolves of Wall Street. A generation of Gordon Gekkos manage hedge funds that pressure corporations to cut corners in the name of ‘unlocking shareholder value’ for investors. Corporations, the environment, and the American Middle Class have been left gutted in their wake.

Citizen Capitalism: How a Universal Fund Can Provide Influence and Income to All

Led by the late Lynn Stout, Distinguished Professor of Corporate and Business Law at Cornell Law School, the authors of Citizen Capitalism detail an economically viable plan for shifting the balance of power in American corporations. Unlike so many proposals today that pit political ideologies against each other, Citizen Capitalism uses the power of shareholder influence against the wolves.

The authors’ plan for a privately ordered non-profit national Universal Fund fueled by donations is fascinating, thorough, and simple. While activist hedge funds typically hold 5 percent or less of a company’s shares, they are the loudest shareholder, and dictate corporate decision making. Where activist hedge funds quickly exit host corporations with billions in extracted shareholder value, leaving companies severely damaged, Citizen Capitalism’s Universal Fund will play the long game. The fund will literally never sell shares and through engaged and educated citizen-shareholders, encourage long term strategic leadership from corporate boards.

Citizen Capitalism is one of many proposals for economic reform and the authors thoughtfully address two of the most commonly promoted, Universal Basic Income (UBI) and Citizens’ Dividends. Both proposals date back centuries and live on in contemporary debate due to a lack of other viable options. Until now.

By providing access for every citizen to register as a citizen-shareholder, the proposal provides a path for increased corporate consciousness. Improved corporate behavior will alter the relationship between business and politics, allowing both corporations and governments to step off the short-term treadmill; to stop myopically focusing on quarterly returns and perpetual campaigning. For all of us together as #TeamHuman to work in our global society to find solutions to our most pressing challenges, Citizen Capitalism provides a path forward. Today.