Category Archives: ethics

Activist Investor Lawsuits

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Comerica, a regional commercial bank, has agreed to be acquired by Fifth Third Bank, a bank holding company, and HoldCo Asset Management, a serial “agitator” and a minority shareholder of Comerica, doesn’t like that decision and has gone into court to stop it.

It turns out HoldCo Asset Management didn’t like that particular deal [Comerica being acquired by Fifth Third Bancorp], arguing it undervalued Comerica. Its battle with the bank has since turned into an all-out war. The firm urged shareholders to vote against Fifth Third Bancorp’s acquisition of Comerica and sued the banks, saying it wasn’t the best option for shareholders.

The lawsuit strikes me as being entirely frivolous and motivated even more by HoldCo’s arrogance than by its greed. The value of any good or service, here the value of Comerica, is not for any third party to dictate to the participants of any exchange, here the acquisition of Comerica by Fifth Third Bank. The value of the exchange is solely what the participants, the shareholders of each of the two banks, say it is.

The two banks’ boards have agreed the deal and are recommending it to their respective shareholders (read: owners and bosses); although, the haven’t yet voted on it. It’s true enough that HoldCo is one of those shareholders, but the shareholders in their aggregate will assign with their votes the value they deem appropriate.

Minority shareholders should not be allowed to impose their minority position on the majority of a company’s shareholders. If they lose the debate over a company’s acquisition or over any other move made or proposed by the company—if the majority of shareholders at each of the two banks vote for the deal—then HoldCo’s only two legitimate recourses are to accept the outcome or sell their shares.

It’s a matter of property rights, here the rights of shareholders in their property of the shares they own of a company.

Lawsuits centered on a minority’s dislike of a company decision or proposed decision should be dismissed for lack of standing or lack of concrete harm.

Full stop.

“News” Media Arrogance Personified

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The lede demonstrates this “news” reader and opinionator Katie Couric’s personal arrogance in presenting what she’s pleased to call “journalism.”:

Katie Couric spoke out against “bothsidesism” in news coverage and insisted people don’t want “just the facts” in the current media environment.

Yes, we do. We want, even though “news”…presenters…don’t want us to hear, all the facts, even though Couric’s presenters prefer to provide only those that suit the presenters’ predetermined narrative. We object strongly to censored presentations, a censorship and bias that’s revealed by what facts are withheld as much as by what facts are selected for reporting.

We don’t mind biased, opinionated commentary, but we expect it to be in carefully labeled opinion pieces, not opinions masqueraded as fact in what is alleged to be news reporting. And, we expect even opinionated commentary to be informed by logic and facts, not hype or hyperbole. Couric again:

So what I try to do, and what we try to do, is help people stay abreast of everything that’s happening, which is increasingly difficult given the velocity of things that are thrown at us primarily by this administration. But try to understand and give them some perspective and context and help explain in some cases why people need to be aware and concerned about some of the things that are happening in this country.

Pick one. You can’t help us “stay abreast of everything that’s happening” when you insist on no ” bothsidesism,” when you insist on only presenting one side. [T]ry to understand and give [us] some perspective and context and help explain?

This is Couric insulting our intelligence. If she had the integrity to present all of the facts, we’d be able to understand for ourselves, to see for ourselves the perspective. We’re not stupid, as she so plainly says we are. Especially when she says she tries to give us some context when, with her own words, she withholds context by presenting only those facts she’s carefully selected for presentation. That contradiction is especially insulting to our intelligence.

And there’s Couric’s precious self-importance, her velocity of things that are thrown at us as though she and her cronies are the audience of any administration’s, much less the current one’s, actions. Couldn’t be that us citizens are the audience.

This is why the so-called news media—both reporting and opinionating—are so distrusted by so many of us.

Who’s In Charge?

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State Financial Officers Foundation CEO OJ Oleka noted in his Wall Street Journal op-ed the foolishness of Minnesota’s decision to eliminate its State Treasurer position with effect ‘way back in 2003. Supporters insisted that the position was purely clerical and so not worth the million dollars a year cost. Instead, the position’s responsibilities were scattered around to other State agencies. Oleka added

When no statewide official is clearly responsible for safeguarding public money, taxpayers pay the price.

Like with the multi-billion dollar Medicaid fraud that’s being uncovered in Minnesota. Only it’s not just the citizens of Minnesota who are paying that price; it’s all of us citizens all across these United States.

Oleka also pointed out the value of having someone in charge of watchdogging a State’s public money.

Across the states, financial officers are proving that vigilance works. Kentucky Auditor Allison Ball uncovered $800 million in wrongful Medicaid payments. North Carolina Treasurer Brad Briner found $170 million in unspent funds, while Iowa’s Roby Smith delivered a record $469 million return on investments that help fund state services.

There’s another factor here, though. Every one of those officials are Republicans.

Hmm….

Typically Liberal “Misunderstanding”

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It’s William Galston, this time. Galston, in his op-ed for last Tuesday’s The Wall Street Journal disparaged SecDef Pete Hegseth’s alleged disdain for the laws of war.

Leave aside the fact that Galston cynically and deliberately chose not to cite any of these laws of war. Instead, he actually wrote extensively about Hegseth’s supposed disdain for rules of engagement. In this vein, Galston generalized, without logic or facts, Hegseth’s disdain for particular rules into a disdain for all rules of engagement.

However, Galston’s more serious…error…is this. Rules of engagement are not Laws of War. RoE are the particulars, tailored to specific combat and short-of-combat environments, intended for particularized implementation of those general laws of war. Yet he opened his piece with this lede, and his piece continued solely in that vein.

It’s no surprise the US Navy’s September 2 strike on an alleged drug-carrying boat near Venezuela has been controversial. The man who now leads the Defense Department has ridiculed the laws of war throughout his military career.

I’m not that convinced, though, that Galston’s mistake is a misunderstanding Given his high skill as a journalist for a leading news outlet, for whom words are his stock in trade, I lean more toward outright distortion in his use of rules of engagement and laws of war interchangeably.

Oh, and one more “leave aside:” The controversy surrounding that second strike is entirely a journalistic construction. Those of us with actual military experience and who are not trading on that experience for political gain see no fault in sending in a second strike to finish a task that the first strike had not completed.

An Empty Promise?

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Supposedly, the US has offered a security guarantee to Ukraine in the form of support[ing] European security guarantees and seek[ing] Senate backing for Washington’s promised role as a means of breaking the current peace talks impasse.

This supposed guarantee

would include monitoring, verification, and deconfliction, the officials said, and would lay out the role the US would play if Russia breached a peace deal and came back to attack Ukraine. They would also include the provision of weapons to deter a Russian force.

Yeah, sure. “Monitoring:” we see you, Russia, resuming your invasion, we’re watching the hell out of you. “Verification:” Yup, Russia really is resuming its invasion. “Deconfliction:” What does this mean? European forces entering Ukraine to fight the barbarian alongside Ukrainian forces? Traffic control to deconflict traffic jams on Ukrainian roads for Ukrainian forces and civilians moving in the other direction? Something else?

“Provision of weapons for deterrence:” This is risible. Europe already is refusing to provide the weapons the UA needs, in the numbers it needs them, or on the schedule it says it needs them. Excuses range from fear of provoking the barbarian to insisting the UA doesn’t really need them like that to claims they don’t have the weapons to provide the UA, having drawn down their armories already with transfers. That last, given Europe’s disdain for any thing military, at least has a measure of plausibility.

The supposed guarantee also purports to include

legally-binding commitments to come to Ukraine’s aid in the event of a Russian attack.

What is the timeline for implementation of a related peace agreement? Would the agreement go into effect before or after “Senate support” had been secured? If after, what support for Ukraine’s continued fight for its survival would be in the offing pending that Senate agreement? If before, how would Ukraine recover or be aided in recovering, from the barbarian’s virtually guaranteed violation of the terms? What would be the Or Else should the barbarian violate the agreement—more monitoring, verification, and…”deconfliction?” All the nations’ governments—including, shamefully, our own—have already been slinking away, their tails covering their crown jewels, from Russian President Vladimir Putin’s nattering on about nuclear weapons.

However sincerely offered, this seems like an empty promise. There’s no guarantee that the Senate, with its two-thirds majority treaty ratification requirement, would support such a thing. A simple Senate majority-voted resolution of support would be meaningless, legally, politically, and morally. Nor is there any guarantee that an alternate path to securing support—bills passed in both the House and Senate, which would require only majority votes (after a 60-vote cloture success in the Senate)—would succeed.

There’s this bit, too, that overhangs any security “guarantee” that might be offered Ukraine. Three of the participants in the Budapest Memorandum—the US, the UK, and France via its separate individual assurance—already have betrayed Ukraine by dishonoring the security and territorial integrity guarantees contained in that document. The Memorandum also was a legally binding commitment.