It’s also important to remember that while some people talk like there’s a legal responsibility to maximize shareholders value which forces businesses to make decisions focused on short-term profits, those people are simply wrong. There’s an extraordinary level of deference given to executive discretion which means it’s quite rare to see successful lawsuits for anything plausibly good-faith. For example, right now there’s a fad to lay people off but any business which chooses instead to invest in their capacity is unlikely to even be threatened with a shareholder lawsuit because no court in the country is going to say that “we are investing in long-term capacity” was clearly wrong.

I wonder if anybody wrote about this problem, like, a century and a half ago.