Which is a dumb idea, of course, as that just leaves the control over your capital to your adversaries. Passive investing works because goals are aligned: The only way to influence an index fund on the investing side of things into doing something stupid is by doing something stupid yourself. If you want to make an S&P500 index fund buy some penny stock, you have to buy it yourself first in massive quantities paying massive prices for it to drive up the market cap. Voting does not work that way.
No, I want Vanguard to hire an independent expert for each company I'm invested in and make the right decisions for me. It is not possible for a human to make an informed decision on voting for each of the thousands of stocks out there. That is one advantage of the fund is they can do that for me.
I have noticed when I vote the shares of the few shares I own that I'm almost always voting with the board of directors. When I've seen a proposal the directors have recommended a No vote on it is always some activist who has their own interests in mind at the expense of me. Sometimes the directors recommend things I disagree with, but those are generally minor details where either way is not harmful to my interests.
The other stockholders are almost never your adversaries. Their interests are in alignment with yours: to vote in such a way that it maximizes the value of the stock.
The only exception would be some kind of action that is specifically discriminatory towards your shares over theirs, which is typically not legal. If it were to occur, that is the only situation where I would want Vanguard to be voting on my behalf.
You're right though that not voting is equivalent and much easier than trying to replicate votes.
> The other stockholders are almost never your adversaries. Their interests are in alignment with yours: to vote in such a way that it maximizes the value of the stock.
Nope. Their interest is to vote in such a way that it maximizes the value of their portfolio. If that doesn't match your portfolio, then your interests are not aligned.
> The only exception would be some kind of action that is specifically discriminatory towards your shares over theirs, which is typically not legal.
There is nothing discriminatory about voting for selling a division of company A to company B, say, and it is certainly not illegal. But it might well still be in the interest of the owners of company B who also happen to hold the only voting 10% of company A, and to the detriment of the owners of the other 90% of company A.
Which is a dumb idea, of course, as that just leaves the control over your capital to your adversaries. Passive investing works because goals are aligned: The only way to influence an index fund on the investing side of things into doing something stupid is by doing something stupid yourself. If you want to make an S&P500 index fund buy some penny stock, you have to buy it yourself first in massive quantities paying massive prices for it to drive up the market cap. Voting does not work that way.