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In The Shareholder Value Myth,1 law professor Lynn Stout pitches her

tent firmly in the camp of the nascent and prematurely moribund Occupy

Wall Street movement. And if contradictions abounded among Occupy Wall

Street folks, they similarly flourish in this slim text. This book

simultaneously argues that the idea of shareholder primacy is—in addition to

being a myth—(a) “the dumbest idea in the world”;2 (b) “an ideology, not a

legal requirement or a practical necessity”;3 and (c) bad law.4 My responses

to these observations are: (a) shareholder primacy is not an idea at all;

(b) shareholder primacy is an ideology, but like certain other ideologies, such

as the ones about the Constitution being sacred or the one about God not

being dead, it is quite useful in a wide variety of situations and contexts; and

(c) shareholder primacy is not bad law because it is not law at all—at least

not in the cartoonish version often presented—and nobody thinks that it is.

There is of course a difference between ideology and law, and the fact that

shareholder primacy is an ideology does not mean that it is irrelevant to law;

and it does not even necessarily mean that there is anything wrong with it.

Christianity, Judaism, capitalism, and vegetarianism are ideologies rather

than laws. But a lot of people find them convincing and even inspirational

all the same.

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