Robert Reich: Will Americans Have a Say in the Corporations We Now Own?

[marmar]

Tuesday, April 28, 2009
Will Ken Lewis Get Canned, and Will Americans Have a Say in the Corporations We Now Own?


I don't know whether Bank of America shareholders will oust Ken Lewis from his chairmanship this week. I don't know if Treasury Secretary Timothy Geithner will eventually do it, either. What really worries me is I don't know who would actually be responsible for doing the deed, or by what criteria.

When it comes to keeping top corporate executives in line we usually entrust the job to shareholders -- or, as a practical matter, boards of directors that are supposed to represent shareholders' interests. When it comes to keeping top public servants in line we generally trust voters -- or, as a practical matter, the elected officials who represent them. But when, as now, the public has committed large amounts of its money to particular companies in the private sector, we're in a quandary.

The $45 billion we've sent to the Bank of America should give the public some say over whether Mr. Lewis remains in his job because he is now accountable to us as well as to his shareholders. But to which group should he be more accountable?

And: Is Mr. Lewis's main job still to make money for his shareholders, or does he now have a higher public responsibility to lend more money to Main Street? Was that public responsibility also paramount last fall when Federal Reserve Chief Ben Bernanke and Treasury Secretary Hank Paulson told Mr. Lewis to proceed with the Merrill-Lynch merger -- and when, according to Mr. Lewis's sworn testimony, he believed they didn't want him to disclose Merrill-Lynch's financial losses to B of A shareholders or anyone else? .............(more)

The complete piece is at: http://robertreich.blogspot.com/2009/04/will-ken-lewis-get-canned-and-will.html