Subject: Shareholder Rights
Author:  Julianne Kruly 
Date:    11/28/97 1:06 PM
     
     
RE:  File No. S7-25-97; proposed SEC regulations
     
Dear Chairman Leavitt:
     
I am strongly opposed to the proposed SEC regulations which would limit 
shareholders' ability to influence corporations' accountability and 
responsibility to society.  I have conducted extensive research on 
corporate social responsibility, and the barriers to such 
responsibility.  One of the chief barriers is an absence of open 
discourse and dialogue between corporate decision makers and the public. 
Shareholders have only recently begun to exercise their voices in 
influencing corporate decisions in socially significant ways.  This is a 
healthy sign, and it of course makes corporate power nervous, as it 
should.  The SEC should be in support of whatever keeps mutual 
accountability between corporations and society expanding, not 
contracting.  The proposed regulations would curtail the accountability 
of corporations, and restrict open discourse with shareholders.
     
ANY restrictions on such discourse will serve as a corrosive force to 
the shred of social responsibility some corporations now reflect.  The 
long-term effects of such corrosion are impossible to measure in 
advance, but you and your office will be among the guilty parties if, in 
retrospect, we look back years hence and see the people in government 
who willingly gave away public control to corporations in worship of 
today's global god -the "free market".  Checks and balances are the 
foundation of our government, and corporations should not be outside the 
checks and balances of the entire system.  Corporations are not 
democracies, but they are supposed to be operating within a larger 
framework of democracy - whether they like it or not.  
     
The SEC was asleep at the wheel during the rise of the junk bond era, 
and only after much damage was done to many businesses and sectors of 
society did the SEC do its duty to reign in irresponsible people and 
their corporations.  Milken and Boesky were only the faces we saw and 
knew.  There were many others playing the game in secret for years, who 
were never charged and never known by the public.  The proposed 
regulations now would increase the secrecy of corporate decision making 
by reducing the shareholders' scrutiny of corporate activities.  This 
can only spell trouble.   
     
Our country is built on certain conflicting ironies.  We pledge our 
allegiance to "liberty and justice for all", yet these two words - 
"liberty" and "justice" have contradictory meanings - individual freedom 
from all restrictions vs. social interdependence and obligations.  The 
unlimited "liberty" which corporations claim they require to maximize 
profit and shareholder value must be mitigated by social justice and 
principles of democracy.  Otherwise, the flagrant liberties taken by 
cowboy corporations today will continue to undermine the modicum of 
social justice which the public has managed to wrest from an open 
critique of corporate power and profit.
     
I urge you to think again about the signs of the times today, and not 
play into the prevailing hand of giving in to corporate power while our 
public institutions erode.  There is frenzy today of elevating the 
corporation and the business person to a status above all others.  This 
is nonsense, and undermines the value of the public servant, such as 
yourself, and the checks and balances our government must provide.  Mr. 
Leavitt, as a public servant, you have an obligation first to the public 
interest.  Please put the public first in your decisions and support a 
more open forum for shareholders, not less.  The short-term gains of the 
GDP can never buy back the public freedoms we lose.
     
Thank you for your consideration.
     
Julianne Kruly