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Today the Supreme Court ruled in Knox v. SEIU that unions cannot simply take resources from non-members and devote them to certain kinds of political activities.

Cato legal analyst Trevor Burrus talks with Caleb Brown about this decision and the court's interpretation of First Amendment rights.
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When the cato institute stands up for dissident shareholders like it does for dissident union members, then maybe i'll care about the issue.
Shareholders can sell the stock if they do not approve. Some people are forced into contributing to a union as a condition of employment.  Your would have a valid argument if people were forced to invest in a company.  The company will always look out for it's best interest, as it should. If you are a shareholder that's exactly what you want.  I would not invest in a company that worked politically against it's own interests. Why is it that liberals cannot understand the difference between money exchanged for value and money taken by force?
While I would say the job belongs to the company and not the employee, the unions are still exerting an undue property right on the job, including extracting rents.

Given the separation from operations that institutional investors create between shareholders and corporations, it seems to me that there is room for some sort of institutions that provide oversight in looking out for shareholders interests in terms of corporate policy.  It could potentially produce all sorts of positive externalities.
"Some sort of institutions" being government? More regulations on corporations does not sound like a good idea to me.  It sounds like you might be referring to some sort of body of shareholders than can make changes to the management if management is not producing acceptable returns to shareholders.  That would be the Board of Directors.

The private sector has this figured out. The more we can remove the public sector the better it will work.
I definitely do not mean government.  Some sort of shareholders oversight union? (I know, that's a dirty word to me too.)  The private sector doesn't have it figured out yet, but the public sector lacks the capacity to do so.  The traditional theory of the firm as solely a profit maximizing entity is no longer sufficient to meet the demands of the public (the people, not their governments).  Given the collusion between the public and private sectors, picking winners and losers, I do not think the current model is sufficient.
I agree that the public sector needs to be reformed. Remove the power of government to provide corporate welfare and the corporations will adjust.  And maximizing profit should be the only goal of a corporation. That means it is providing goods and services that people want, at a price they are willing to pay.

The "public" can change the behavior of a corporation by not investing or not buying it's products and services. Profit is and should always be the goal since profit/loss is the sole indicator of the success of a company.

People that aren't shareholders or employees should not have the profit of a company as their goal, but rather their own interests. What would be some examples of other demands that the public would place on a company that couldn't be effected through profit and loss?
I think you would agree that the government is incapable of mitigating negative externalities equally.  I think most shareholders support appropriate and sensible compensation in such scenarios, but pure profit-maximization runs contrary to that interest.  I am by no means saying that corporations should become non-profits or partial non-profits, just that there is room for improvement, and it isn't going to come from the current allocation of oversight.  Rather than attacking Boards of Directors as ineffectual, I would rather give them support in breaking bad paradigms like golden parachutes and "bad news" hoarding.
The more profit a company makes the more successful it is. Who determines what compensation is sensible? A company will pay someone what they are worth to the company, not what an outside individual feels that they are worth.  If they pay a CEO $50 Million then they feel that the individual is adding more than $50 Million in value to the company. If they are not they will be removed and replaced with someone who will. 

The same applies down the line. If a line worker is earning $25K then the company has evaluated that they can afford to pay the individual and get more than $25K value from that person.

I'm not sure exactly what you mean by "bad news" hoarding. But if it means misleading shareholders then it is fraud and is against the law.

Maximizing profits ensure that resources are allocated efficiently.
I suppose I buy into the CEO salary-bubble theory.  I do not think the current standard for compensation packages accurately reflects value. 

I am not referring to fraud, but to company cultures that encourage employees down the line to keep their head down and their mouth shut, rather than raising potential red flag issues.  That isn't a regulatory issue but a leadership issue.

Again, I am not against maximizing profits, just for accurately accounting for externalities.
I have seen the problem about employees not reporting deficiencies first hand all to often.  At some point it effects profits and if management does not correct the problem, then management will be replaced. 

I understand you are not against maximizing profits, but I am still trying to understand some of the externalities that you are referring to.
Either the management gets replaced, or the company explodes on the shareholders.

The traditional negative externalities such as water and air pollution have been compounded by heat (local, not global) and genetic pollution.  I don't want to get into heavy handed litigation by Monsanto, but it doesn't just cost the small farmers infested with their seed.

There are also opportunities for relatively profit-neutral positive externalities, that at the very least are great marketing/goodwill-building opportunities, and often build the human, cultural, and organizational capital in the community, which firms can then tap into.   This is already common practice for many firms.
The negative externalities you mentioned should be penalized if it infringes on the property rights of another. The firm's profits will suffer from lawsuits as well as boycotts if enough consumers are displeased with the business practices.

On the same train of thought the profit neutral activities are only worth pursuing if they can increase profit.
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