The raiders figured profits would be higher if the companies fought unions, cut workers' pay or fired them, automated as many jobs as possible or moved jobs abroad, shuttered factories, abandoned their communities, and squeezed their customers.
Although the law didn't require companies to maximize shareholder value, shareholders had the legal right to replace directors. The raiders pushed them to vote out directors who wouldn't make these changes and vote in directors who would (or else sell their shares to the raiders, who'd do the dirty work).
Since then, shareholder capitalism has replaced stakeholder capitalism. Corporate raiders have morphed into private equity managers, and unfriendly takeovers are rare. But it's now assumed corporations exist only to maximize shareholder returns.
Are we better off? Some argue shareholder capitalism has proven more efficient. It has moved economic resources to where they're most productive, and thereby enabled the economy to grow faster.
By this view, stakeholder capitalism locked up resources in unproductive ways. CEOs were too complacent. Companies were too fat. They employed workers they didn't need, and paid them too much. They were too tied to their communities.
But maybe, in retrospect, shareholder capitalism wasn't all it was cracked up to be. Look at the flat or declining wages of most Americans, their growing economic insecurity, and the abandoned communities that litter the nation.
Then look at the record corporate profits, CEO pay that's soared into the stratosphere, and Wall Street's financial casino (along with its near meltdown in 2008 that imposed collateral damage on most Americans).
You might conclude we went a bit overboard with shareholder capitalism.
The directors of "Market Basket" are now considering selling the company. Arthur T. has made a bid, but other bidders have offered more.
Reportedly, some prospective bidders think they can squeeze more profits out of the company than Arthur T. did.
But Arthur T. knew may have known something about how to run a business that made it successful in a larger sense.
Only some of us are corporate shareholders, and shareholders have won big in America over the last three decades.
But we're all stakeholders in the American economy, and many stakeholders have done miserably.
Maybe a bit more stakeholder capitalism is in order.
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