Campus Protests on South Africa

Jean Sindab makes the same mistake in the article (Editorial Pages, April 29), “The Logic of South African Disinvestment,” that many of my fellow students across the country have made.

They want U.S. firms to leave South Africa, but then they call for public institutions to sell their stock in those firms. The belief is that selling the shares would somehow put pressure on the companies to cease operations in South Africa.

This is based on the erroneous notion that selling a company’s stock is equivalent to withdrawing money from that company. This notion is reinforced when public figures and the media make statements that imply that this is the case.

In actuality, the only thing that selling stock would do would be to change the ownership of that stock, which would not have any effect on the companies involved. A more effective approach is that suggested by The Times in its editorial (April 26), “Testing the Leverage.”

Institutions, among them the University of California, can pressure firms to stop doing business with South Africa by submitting shareholder resolutions and voting their shares to that effect. This is the course of action adopted by numerous church groups and organizations such as the New York City Employees’ Retirement System. This is the way that institutions can influence the corporations in which they hold stock. As The Times pointed out, they would have no influence if they sold their stock.

ALAN GIN

Goleta