GMU Econ alum Paul Mueller continues his insightful series about ESG ‘investing.’ A slice:
Social and governance criteria, in as much as they push “stakeholder capitalism,” make the principal-agent problems unmanageable. By creating many more “principals” (stakeholders) with divergent, often conflicting, interests, managers actually can’t act in the interest of principals even if they want to, because no single interest exists. What’s more, managers can now pursue whatever they want, so long as they can find a relevant stakeholder group whose interests align with theirs.
Ashley Rindsberg believes that we’ve reached peak ESG. A slice:
The idea of stakeholder capitalism is attributed largely to Klaus Schwab, creator and chairman of the World Economic Forum, who began spreading the idea in a 1971 study he co-authored called “Modern Company Management in Mechanical Engineering”. This top-down approach to shaping how wealth is created, and in whose hands it ends up, played well to a media educated in America’s Marxism-infused liberal arts colleges. And the business crowd loved it too. Suddenly, bland business conferences felt less like trade conventions and more like geopolitical summits. You weren’t merely investing in funds, selling widgets, or cooking up ever more optimised ads. You were saving the world.
Scott Sumner warns of the dangers of nationalism.
John Cochrane argues for honesty in arguing about the Claudine Gay affair. Three slices:
Harvard faces a historic choice: Is its main mission advocacy for, advancement of, and indoctrination in a particular political and ideological cause, going by names such as “woke,” “social justice” “critical theory” and “diversity equity and inclusion” (a chillingly Orwellian name since it is exactly the opposite)? Or is its main mission the search for objective truth, via excellence, meritocracy, free inquiry, free speech, and critical discussion, bounded by classical norms of argument by logic and evidence; and to advance and pass on that way of thinking? Even though yes, most of those ideas originated from dead white men whose societies had, in retrospect, some unpleasant characteristics? And to get there, given the BS spreading like cancer and the political and ideological monoculture that pervades the university, it needs a top to bottom cleanup.
This is a key moment. After October 7, a lot of the larger community of alumni, donors, trustees, parents, government and employers, woke up. What, “decolonization” means kill the Jews? Who knew? Well you would have if you had been paying attention, one is tempted to answer, but ok, you had lives to lead and the Orwellian doublespeak is seductive if you’re not paying much attention. They then look a little harder and suddenly see the politicized rot that has taken over the whole university. Now is the chance to force a change.
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Why do I think Gay should go? Because she persecuted Roland Fryer, the brilliant Black economist who inconveniently found the “wrong” results in a classic study of race and policing. Because she fired Ronald Sullivan, also incidentally Black, who had the temerity to provide legal counsel to Harvey Weinstein, from his faculty dean position. The great defender of free speech and academic freedom before Congress found that the mere act of having provided Weinstein legal counsel made students feel “unsafe.” She forced Carole Hooven to resign, for teaching that sex is “binary and biological” in a biology class. She led efforts to expand “teaching in the broad domain of ethnicity, indigeneity, and migration.” (Two Blacks and a woman. If you hadn’t figured it out, this is about politics, not race). I haven’t followed the Ryan Enos (white man, but left wing research) affair carefully, but the charge that she quickly covered it up is out there. Harvard’s announcement of her appointment trumpeted that “She is the founding chair of Harvard’s Inequality in America Initiative” and similar efforts. Harvard is dead last in FIRE’s ranking of free speech and academic freedom.
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Gay is great at doing exactly what Harvard wants! Pursue the far left purification agenda, but lawyer and HR up when asked in plain English to account for it. She should be promoted for this effort! But no, Harvard should fire her because the cause is rotten, not the execution.
Andrew Stuttaford reports that Javier Milei rejects BRICS.
It’s hard to overstate how irresponsible and destructive Francis Collins’ view is and was. He dispensed with all the rest of public health to focus on covid and lockdown, and countless millions — especially children and the poor — paid the price, sometimes with their lives.
