OFTLOP

I'm really glad I'm too old and cynical to take the likes of Stephen Bainbridge as any sort of authority. On anything. While I'm not particularly partial to Edwards, he seems one of the brighter possibilities in the not-Hillary, not-Obama spectrum, and a hell of a sight better than anything the Republicans are offering (Romney? McCain? Lieberman? Brownback?).

Given the deleterious effects the trial lawyer industry has had on the American economy, as ably demonstrated by the Manhattan Institute's Trial Lawyers Inc. project, I remain unconvinced that a trial lawyer ought to have much authority over the economy.

Time to take Bainbridge apart. First, the Manhattan Institute, home of Trial Lawyers, Inc., is a conservative think tank proud to include among its present and/or past board members Wiliam Kristol and Peggy Noonan, two of the more blinkered knee-jerk rightwingers around. Second, Trial Lawyers, Inc. is nothing more than a hatchet job on one of corporate America's favorite targets -- the tort system.

Bainbridge cites his criticism of Edwards' approach to corporate governance, a bit which ends up with:

The root economic argument against shareholder activism thus becomes apparent. Large-scale shareholder involvement in corporate decisionmaking seems likely to disrupt the very mechanism that makes the modern public corporation practicable; namely, the centralization of essentially nonreviewable decisionmaking authority in the board of directors. Given the significant virtues of discretion, one ought not lightly interfere with management or the board's decisionmaking authority in the name of accountability. Preservation of managerial discretion should always be the null hypothesis. The separation of ownership and control mandated by U.S. corporate law precisely that effect. Empowering shareholders therefore may be good politics these days, but its bad public policy.

A couple of things going on here: he reports Edwards' position as favoring allowing shareholders to nominate directors without the use of proxies. Somehow, in Bainbridge's discussion, this becomes shareholders' direct participation in decision-making, i.e., management. Second, and I'm admittedly fuzzy on the timeline, but it seems to me that Enron et al. had happened before this was posted in 2003. If so, this whole post is just the least bit disingenuous. If not, the disingenuous part is citing it now without any disclaimer.

And note Bainbridge's insistence on the preservation of the board's nonreviewable decision-making authority. Sound familiar? Sort of a sub rosa Apologia Pro Vita Sua for the Bush administration, which of course takes as its model a highly paranoid version of corporate governance -- which Bush couldn't manage to make work in the corporate sector.

In short, what Bainbridge faults Edwards for proposing is a remedy to the very abuses that make such a remedy necessary to begin with -- unless, of course, you are Stephen Bainbridge, in whose universe whatever corporate management does is fine because they know best and are more honest and loyal and brave and trustworthy than the rest of us. Or something.

The other piece that Bainbridge cites is just a smear on "trial lawyers," that right-wing catch-all for anyone who dares to hold corporate America accountable for anything. The most egregious transgression is his long quote from The Washington Times (an unimpeachable source, to be sure), in which the reporter actually establishes nothing, but does so in a remarkably sinister way. The idea that new evidence on the causes of cerebral palsy indicates that Edwards "and his fellow malpractice practitioners" were somehow part of a sinister plot against the medical profession for working on the evidence they had at the time is something that, apparently, only Bainbridge could believe. Of course, Bainbridge apparently believes that no accountability is superior to any accountability at all.

As for the second part of the slam, Bainbridge once again relies extensively (entirely) on The Washington Times, which one of his readers debunks in the comments. The man really has to start reading some real newspapers. (And have you noticed how those leaning to the right -- the party of privilege and wealth -- think it's somehow sinful for Democrats to be well off? Or it should at least count against them in an election.)

I'm happy to note that Bainbridge gets roundly thumped by the majority of his readers. Brought to us, as might be expected, by Clive Davis at Andrew Sullivan, where Bainbridge still seems to have some credibility. (As for Bainbridge's main source, see this story by Barbara O'Brien at C&L.)