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SEPTEMBER 27, 2004
Sounding Off About Bush's "Ownership Society" If President George W. Bush really wanted an "ownership society," he would support the Securities & Exchange Commission's rule to allow stock owners to place a token number of board nominees in the corporate proxy ("Bush's agenda," Cover Story, Sept. 6). Instead he is bowing to his managerial friends at the Chamber of Commerce and the Business Roundtable, holding back on a rule that would empower owners. Bush's vision favors those who manage other people's money, not an ownership society. In contrast, Senator John F. Kerry (D-Mass.) says "the SEC should allow long-term significant investors to have a voice in the selection of a portion of a company's board of directors." James McRitchie Elk Grove, Calif. "I Want people owning something in America" said President Bush in announcing his ideas for the future. He and the Republican leaders of this country have certainly done their part to ensure that Americans for many years to come will have part ownership of the largest federal deficit our nation has ever seen. It is time we all owned up to the reality that as of August, the total national debt was more than $7.3 trillion and that this deficit requires Americans to borrow about $2 billion from foreigners every working day. I guess some people do own something in America under this Administration -- just not Americans. Daniel Kirkdorffer Redmond, Wash. As a long-standing reader of your magazine, I was surprised by your objection to Bush's Social Security initiative ("Our take on the GOP's economic plans," Editorials, Sept. 6). You state that the proposal is based on ideology, not economics, and therein lies the fallacy of your argument. Economics in a free society should be based on freedom of choice, rights to property, and building of assets and capital. Within this framework, you bet the plan is based on ideology. By allowing individuals to decide what to do with their own contributions to their retirement, the President is not destroying the safety net -- rather, Bush is allowing individuals to own it. The fact that the system is not broken is irrelevant. Carroll Stein Roscoe, Ill. Our Spotlight On Pensions Hits The Mark "Pensions on a precipice" was a fine article (News: Analysis & Commentary, Sept. 6). Bailing out the Pension Benefit Guaranty Corp. is something the middle class can't afford. Too bad every politician doesn't read BusinessWeek (MHP ). LaVern F. Isely Monroe, Wis.   In Praise Of W. Edwards Deming "The kings of quality, " about Joseph M. Juran and W. Edwards Deming, seriously understated the contribution Deming made in teaching his theory of management (The Great Innovators, Aug. 23-30). In fact, his theory went well beyond simply dealing with the application of statistical methods in manufacturing. I was fortunate to have had extensive relationships with Deming and also Peter F. Drucker during my time as president and then chairman and CEO of Ford Motor Co. (F ) Deming served as a consultant to Ford through much of the '80s. Two of his theories of management alone were worth his consulting fee. In one, he stressed that if you are having a problem, 9 times out of 10 your problem rests with management. How true! A second point I found most helpful was the power of continuous improvement. His was a rich mind, full of extremely helpful management insights. Donald E. Petersen Chairman and CEO (retired) Ford Motor Co. Bloomfield Hills, Mich. Broadband: Why The U.S. Is Likely To Fall Further Behind "Behind in broadband" (Information Technology, Sept. 6) described quite clearly that U.S. policies and the actions of the incumbent Bell telephone companies will cause the U.S. to fall even further behind other economically developed countries in terms of broadband deployment. Recent legal actions by the Bell telephone companies to block fair and open access to their local networks at cost-effective rates will eliminate any progress that has been made. Why are pro-competitive regulatory policies still essential for the U.S.? The incumbent Bell phone companies inherited a monopoly infrastructure that remains the only ubiquitous last-mile access to the doorstep of every home and business. Access to the last-mile network is, in essence, a public good and must remain available on an unbundled basis to competitors seeking to provide new and innovative services. Those competitors, such as XO Communications Inc. (XOCM ), have invested billions of dollars to build the most technologically advanced networks capable of providing innovative broadband services demanded by businesses and consumers. For these investments to continue, competitive carriers need the assurance that they will have access to last-mile facilities at cost-effective rates to deliver these services. Carl J. Grivner, CEO XO Communications Reston, Va. Everyone Benefits From Shareholder Lawsuits Louis Lavelle's commentary "Smoke, mirrors, and shareholder settlements" missed the big point that these creative, value-enhancing settlements were impossible five years ago (Management, Sept. 6). The reforms they have achieved, beginning with the Cendant Corp. (CD ) litigation led by the California Public Employees' Retirement System, promise to strengthen corporate accountability, reduce risk, and improve returns. Studies by McKinsey & Co. and others demonstrate that institutional investors consider well-governed companies more valuable. Other studies link good governance to better long-term stock performance. Lavelle claims that these settlements take the pressure off companies to reform. In my experience, these settlements often are the only way to get any reform. What is most promising about shareholder settlements are not terms that simply demand that the malefactors abandon the companies they have damaged but the imposition of healthy systems of accountability. Forcing out bad apples is relatively easy. The settlements focused on the tougher job: stopping the rot. Richard A. Bennett Lens Governance Advisors Portland, Me.
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