Firms targeted by activists experience lower investment and R&D, provided they survive at all. Given that these investments are the lifeblood of our economy, we can assume that if this trend continues, the results will be disastrous. Our corporations no longer attempt to develop new products, train-up workers, or expand into new ventures, and ultimately, our national competitiveness will suffer.

What happened in Wisconsin is one example of a larger problem that demands action. Activist hedge funds are a key proponent of the short-termism trend that has captivated Wall Street. The number activist campaigns have risen annually by 60 percent since 2010, and there were 348 activist campaigns in 2014. Their assets under management have grown from $12 billion in 2003 to over $200 billion today and no company is too large to escape their attacks.

WASHINGTON, D.C. — Today, U.S. Senators Tammy Baldwin (D-WI) and Jeff Merkley (D-OR) introduced legislation to increase transparency and strengthen oversight of activist hedge funds.

The Brokaw Act is named for a small Wisconsin town that went bankrupt after an out-of-state hedge fund closed a paper mill that had provided good jobs to the town for over 100 years. The activist hedge fund bought up the legendary Wausau Paper Company, forced out its executives and demanded short-term returns like buybacks at the expense of the company’s long-term future.

“We cannot allow our economy to be hijacked by a small group of investors who seek only to enrich themselves at the expense of workers, taxpayers and communities. This legislation updates Depression-era rules to address the financial abuses being carried out by activist hedge funds who promote short-term gains at the expense of long-term growth,” said Senator Baldwin. “The Brokaw Act will take on a rigged game by increasing transparency and strengthening oversight of activist hedge funds. These reforms will help ensure that no other small towns in America will fall victim to activist hedge funds on Wall Street. It is time to stand up for our Main Street economy and rewrite the rules for Wall Street so we can build an economy that works for everyone, not just those at the top.”

“We should measure the success of our economy not by the profits of hedge funds, but by whether working Americans can find good jobs that provide a solid foundation for their families,” said Merkley. “Hollowing out longstanding companies so that a small group of the wealthy and well-connected can reap a short-term profit is not the path to a strong and sustainable economy for our nation. It’s time to take on this rigged system and stop the short-term game playing that sells our workers, businesses and economy short.” www.businessinsider.com/...