In 1972, management guru Peter Drucker wrote The Unseen Revolution: How Pension Fund Socialism Came to America, in which he described a "revolution no one noticed." The unseen revolution was workers' accumulation, through their pension funds, of thirty-five percent of U.S. corporate stock, an amount “more than enough for control.” Drucker predicted that this ownership interest would increase to 70% by 1985, allowing U.S. employees, “through their pension funds,” to become “the true owners of the country’s means of production.” “In other words,” according to Drucker, “pension funds
will ‘own’ America by then, except for the agricultural and governmental sectors.” Drucker’s prediction over a quarter century ago was not far from the mark: By 2005, institutional investors, which include pension funds, controlled 69.4% of all U.S. corporate stock.
The best source for data on institutional investors is the Institutional Investment Report,
available from The Conference Board. Institutional investors currently
manage nearly $20 trillion in assets, owning about 20% of U.S. equity.
Institutional investors own 59.2% of U.S. outstanding corporate equity.
Pension funds alone own 40.7% of U.S. equity assets, followed by
investment companies (22%), insurance companies (23.3%), banks and
trusts (11.7%), and foundations (2.4%), according to the 2005
Institutional Investment Report. Public pension funds hold 11.6% of all
institutional investor assets. Collectively, insitutional investors
control 69.4% of the equity of the largest 1000 U.S. corporations.
To learn more:
No More Business as Usual (excerpt from Justice on the Job)
Wall Street Walk and Wall Street Talk (reprinted from The labor Lawyer)