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Quotation of the Day…

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… is from Richard Epstein’s brilliant take-down of Elizabeth Warren’s calamitous scheme to radically restructure corporate governance in the United States [2] – a scheme that has among its central components the government-mandated requirement that corporations act with a fiduciary duty not only toward their shareholders but also toward so-called (and necessarily ill-defined) “stakeholders”:

Warren’s proposal is unconstitutional to boot. The doctrine of unconstitutional conditions [3] makes it clear that the government cannot attach whatever conditions it wants in the exercise of its monopoly power over corporate charters, any more than it can do so with licenses and permits. The state can tell drivers that they must take driving tests to use public highways, but it cannot insist that drivers surrender their rights to participate in political debate or against unreasonable searches and seizures to use public highways. The regulation of corporations is similarly constrained, so that the conditions attached to corporate charters must be reasonably related to the safe and prudent operation of their corporate businesses – and not the stringent conditions that Warren champions under her progressive banner. Her egalitarian grandstanding gravely threatens the liberty and prosperity of our nation.

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