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Author Topic: The Corporation
KidB
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Everard to Daruma on the "Freedom to Fascism" thread.

quote:


D: "You couldn't be more wrong, Ev. Without Government collusion, corporatism can't survive.

Yes, that includes marketing as well."

E: Care to explain? I tend to think that history defeats this argument, but I'm willing to listen to an explanation that doesn't include calling me a socialist

I'd say the crucial thing here is that a corporation is something created by a government. It is given "personhood" and granted special protections and privileges designed to make it more powerful economically than any normal business would be otherwise, limited liability for shareholders being chief among these. Such a thing would never come into existence in our system of law without the specific sanction of the government.

Corporations in the U.S. were originally (pre-Reconstruction) chartered for specific public works projects only, and were dissolved upon completion of the project (usually). Far from being big businesses that just "happened to succeed," they are the single most powerful instrument by which the government has enacted its will throughout American history. In the late 19th century, for instance, states competed with one onether to loosen their corporate laws in order to attract more tax revenue.

Today, our media laws are based around the privileges the government wishes to grant to certain media corporations (just as one for-instance). Corporate lobbyists routinely write legislation. Many talking heads in the mainstream defend this as a first amendment right to free-speech and petition the government, but this overlooks the fact that the corporations are privileged by the govt. in the first place.

Even from a strict Libertarian prospective, one can take a very different view of "regulation" regarding the corporation as opposed to the lives of individuals and independent businesses. Regulations create the corporation. It could not possibly exist otherwise. The govt. relationship to the individual is representational, where as its relationship to the corporation is "positive" - it creates the corporation, but not the individual. Hence, my argument is that it is not "regulating" business to restrain the corporation - properly seen, one is actually restraining the government. The government gains power as the corporations generate revenues - the historical relationship is inescapable. The government protects corporations above all else (witness recent bailouts).

Daruma also made the point:

quote:
But I will like to say this as well: many leftists that have made the same points I have in regards to corporatocracy/corporatism all seek to indict "Capitalism" as the primary culprit and means in which the corrupt current state of affairs came to be.


I am reminded of this every time I hear liberal democrats pine for the greatness of the Clinton era. They seem to think that the housing/finance debacle all falls on Bush co.! This despite the fact that it was Clinton who unleashed the beast, Clinton who allowed the mergers of these already too-powerful elites, Clinton under whose watch the auditing of major corporations plummeted, Clinton who re-wrote the unemployment guidelines and inflation index to literally edit out all the bad news...and so on.

Strict capitalism has rarely seen the light of day. Take, for instance, our perverse use of the term "Free Trade." Democrats here in NYC like to ask me, when I challenge NAFTA, "how can you be against free trade?" I say I'm not, but that NAFTA has nothing to do with "free trade." In a free society, a business that damages the environment is liable for damage, and workers are free to collectively bargain for fair wages. In Mexico, workers are routinely fired or killed for organizing (as they are in China). And regarding the environment:

quote:
The post-NAFTA environmental regime’s capacity to cope with trade-related challenges suffers from fundamental impediments. Under NAFTA, for example, domestic environmental laws should not discriminate against trade; thus various of NAFTA’s dispute settlement provisions allow firms to challenge environmental regulations. Such mechanisms are liable to abuse, as seen recently in the case of NAFTA’s Chapter 11.B rules for investor protection. These rules obligate governments to compensate investors for regulations that expropriate an investor’s future property. Fearing such penalties, states and provinces may retreat from imposing tough environmental regulations.
http://www.fpif.org/briefs/vol4/v4n26nafta.html

In other words, NAFTA and corporate law protect investors from responsibility for damage done to the environment. This is a perfect example of how principles of limited liablity create pools of revenue far in advance of moral considerations. "Risk" imposes moral, ethical, and financial restraint. By limiting the risk of investors, the Corporation amasses wealth disproportionately.

Whenever we consider the poor and downtrodden in urban areas like here in NYC, we have been trained to think of them as resulting from "lack of care," as in welfare, education. I'm beginning to think we've been collectively brainwashed into overlooking how much the government has done to create these problems - seizing whole neighborhoods by eminent domain, for instance, to build highways and factories where they are unwanted and driving down housing values (and hence revenue for local schools). Or to take an example I recently came across in law class - housing projects in the early 60's...ugly high-rises that were commissioned by the govt, paid for with tax dollars, and then handed to corporate owners who refused to police them. As a result, they became crime magnets. And so on.

The debate I have with myself nowadays is how much can we expect the govt to clean up its own mess, if at all? Is welfare compensation for past wrongs, or just another means to create dependence, or both? It's time to deconstruct how the language of liberty on the "right" and the language of "helping" on the left is used to manage and control the populace.

Jeez, did I just write that? I sound like the bastard child of Ron Paul and Foucault. [Eek!]

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Everard
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Initial thought:

I guess one of the things I'm thinking of with regards to marketing, is that, regardless of whether its a business, or a corporation, marketing is more effective without any government action then it is with any government action, unless the government is actively spreading the marketing of a business. And it is marketing that is driving culture change more then anything else. More sexuality? Marketing. High debt? People buying stuff because of marketing. Etc.

Government might hop on the bandwagon, and does, but the same problems would occur WITHOUT government.

With the FDA, people are going to buy the crap thats sold in grocery stores. But they'd buy it, and there's be MORE crap, without the FDA to say "you have to label certain ingredients and nutriotional information." Would I like a stronger, more aggressive, FDA? Absolutely. But it helps consumers, rather then businesses.

Not that I disagree, in general, about the colluding influence of government and business... but government is more of a parasite, I think, then an enabler, when it comes to how business influences our lives negatively.

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Daruma28
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I'm beginning to think we've been collectively brainwashed into overlooking how much the government has done to create these problems - seizing whole neighborhoods by eminent domain, for instance, to build highways and factories where they are unwanted and driving down housing values (and hence revenue for local schools).

Waking up to the truth Kid. It's called the Hegelian dialectical process, and it's the primary method of social engineering used to get to the point that we are at today.

From Amerikan Expose

quote:
The Hegelian Dialectic is, in short, the critical process by which the ruling elite create a problem, anticipating in advance the reaction that the population will have to the given crisis, and thus conditioning the people that a change is needed. When the population is properly conditioned, the desired agenda of the ruling elite is presented as the solution. The solution isn't intended to solve the problem, but rather to serve as the basis for a new problem or exacerbate the existing one.

When the newly inflamed difficulty reaches the boiling point of a crisis, it becomes the foundation upon which arguments may again be made for change. Hence, the process is repeated, over and over, moving society toward whatever end the planners have in mind.

It's also important to understand that as this process is being driven, arguments are created both for and against certain measures of change. All arguments are controlled. The presented solutions — each with varying levels of unadornment — are "debated" publicly by the manipulators or their minions. This is done until a perceived compromise has been reached on the best measure to take in route to solving the crisis. Then, the outcome of the "debate" — which purportedly weighs the concerns of the public with the mandate to do something — is enacted as public policy.

In this way, the real agenda can be accomplished while the masses are diverted by faux issues. While the right and the left argue about welfare, the true agenda - the continued expansion of the governments size and scope carries ever-onward.

Sounds like you've taken the partisan blinders off and starting to realize that both sides of the partisan political coin are certainly corrupt. Funny, 'cause it was only a couple of years ago where I was on the elephant side arguing with you on the donkey side so vehemently about what we thought were really matters of importance -- I guess people really can change. [Smile]

I feel the same way when I criticize the multinational corporations and how they've subverted our food supply. I sound like the bastard child of a NGO protester and Ralph Nader.... [Eek!]

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Storm Saxon
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I don't know how much I agree with Daruma's link, how much control the powers that be really have over the country, but it is interesting how quickly the Patriot Act was written, isn't it? Other people have said, recently, that the state has one waiting in the wings to censor content on the net when a suitable crisis occurs.
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Daruma28
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quote:
Originally posted by Storm Saxon:
I don't know how much I agree with Daruma's link, how much control the powers that be really have over the country, but it is interesting how quickly the Patriot Act was written, isn't it? Other people have said, recently, that the state has one waiting in the wings to censor content on the net when a suitable crisis occurs.

I don't know how much I agree with it either...it was just one of the top google links when I googled "Hegelian Dialectical Process." I learned about that from a hard cover book I read that doesn't have a net link.

But yes, I do agree, the PATRIOT Act was written long before 9/11 occurred. It's no accident that both Dems and Reps signed off on it without even reading it.

That's because the whole "Republican vs. Democrat" and "Liberal vs. Conservative" GAME is a manufactured illusion to deceive We the Sheeple.

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KidB
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quote:
Sounds like you've taken the partisan blinders off and starting to realize that both sides of the partisan political coin are certainly corrupt. Funny, 'cause it was only a couple of years ago where I was on the elephant side arguing with you on the donkey side so vehemently about what we thought were really matters of importance -- I guess people really can change.
I've always sensed that our views in some areas were closer than you realized, and that we were talking past one another. I've often called myself a "Left-Libertarian" when asked. Part of the problem - which we may still have for all I know - is that I have often spoken of "government" in an ideal form, as something that people can engage in and be served by without coercion, and can opt out of if necessary (this is the advantage of state and local govt - smaller, and one can "opt out" of the social contract by moving), whereas you refer to the govt which we have (the evil one).

That being said, it was only over the past year or so that I became fully aware of the ignominy of all things Clinton, and the extent to which his/her/its supporters (and through this, most "New" Democrats) are willing to apologize, obfuscate, and outright ignore what has been done against them in the name of the Democratic Party (and not just Repubs). Also, my wife, who is a finance & corporate governance analyst, has given me a crash course in all things corporate and nefarious in the U.S.

But don't worry - I'm sure there's still plenty for us to disagree on. [Wink]

[ September 10, 2008, 04:07 PM: Message edited by: KidB ]

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Jesse
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quote:
I am reminded of this every time I hear liberal democrats pine for the greatness of the Clinton era. They seem to think that the housing/finance debacle all falls on Bush co.! This despite the fact that it was Clinton who unleashed the beast, Clinton who allowed the mergers of these already too-powerful elites, Clinton under whose watch the auditing of major corporations plummeted, Clinton who re-wrote the unemployment guidelines and inflation index to literally edit out all the bad news...and so on.
I spent months trying to explain this, and people just figured I hated chicks.
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OpsanusTau
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Well, you do, right?
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Storm Saxon
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Who doesn't?
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Jesse
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Oh, of course I do.

But it's just not relevant to Clintons banker-sucking.

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LoneSnark
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quote:
Regulations create the corporation. It could not possibly exist otherwise. The govt. relationship to the individual is representational, where as its relationship to the corporation is "positive" - it creates the corporation, but not the individual.
KidB, your argument falls apart right here. While it is the case that corporations today exist under the sanction of government, that need not be the case. 'Corporations' as we know them today existed before the incorporation laws were passed in the 19th century. They were a product of an individual's right to contract. Being such, they did not enjoy liability protections. But it is sufficient to disprove the assertion that corporations with investor voting shares, boards of directors, etc, cannot exist without government sanction.

And trust me. Without government sanction human beings will very quickly set up corporations under the common law right to contract. Shareholders will simply learn how to live with the liability, which as modern capitalism demonstrates would still be very rarely utilized (most corporations would simple deal with the issue by buying liability insurance to protect their shareholders directly).

Which is what happened in real life to get us where we are. The government sold liability insurance which costs it nothing to provide, which you only need to pay for when you turn a profit, and yet does not need to pay out for claims since congress simply made it illegal to sue corporate shareholders.

A corporate does not need to be a legal person to conduct business anyway. What it is are hired agents acting on behalf of shareholders. They should still enjoy all the rights and priveledges of the shareholders in question. Afterall, surely your rights and priveledges should not degrade just because there are more than one of you.

Eitherway, I believe this protection is not necessary, and a world without such protections would still look predominantly like the world we currently enhabit in the western world (just with smaller government, obviously).

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KidB
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quote:
KidB, your argument falls apart right here. While it is the case that corporations today exist under the sanction of government, that need not be the case. 'Corporations' as we know them today existed before the incorporation laws were passed in the 19th century. But it is sufficient to disprove the assertion that corporations with investor voting shares, boards of directors, etc, cannot exist without government sanction.


Wrong on many levels, and even if the statement you quote from me were incorrect, it does not cause my argument to fall apart.

Taking the particulars:

In America? "As we know them today"? This one sentence is self contradictory. Corporations "as we know them today" are a direct result of the laws passed in the 19th century. Sure, they existed long before then, with certain formal features in place, but with far more strictures via the charter. My argument, as I already explicitely said, is in reference to the post 19th century corporation.

Outside of the U.S. is another matter.

quote:
They were a product of an individual's right to contract. Being such, they did not enjoy liability protections.
Regarding liability, that was my whole point. You are reiterating points I already made. Corporate personhood and limited liability are the defining features of the modern corporation - both are creations of the government. As for the "right to contract" - that, as you note, is something recognized by common law, i.e. courts, which are the government.

quote:
Without government sanction human beings will very quickly set up corporations under the common law right to contract. Shareholders will simply learn how to live with the liability, which as modern capitalism demonstrates would still be very rarely utilized (most corporations would simple deal with the issue by buying liability insurance to protect their shareholders directly).
This is one of your look-good-on-paper arguments. I don't buy it. Liability insurance ain't cheap. I think you're missing the point here, LS. It's not the existence of "something" that can be called a corporation that's the issue - it's the present form of the corporation which makes it the wealth-generating powerhouse, and it is currently law which sets this engine loose, with unfair advantages over everyone else. Sure, some investers could get together otherwise - but how will the government recognize their contract? That's the issue. Recognizing a corporation as an individual with an individual's rights is not something that some businessmen can accomplish on their own.

quote:
Which is what happened in real life to get us where we are. The government sold liability insurance which costs it nothing to provide, which you only need to pay for when you turn a profit, and yet does not need to pay out for claims since congress simply made it illegal to sue corporate shareholders.


Yes, and it also passes legislation at the behest of some of the biggest, handing property directly over to them.

quote:
A corporate does not need to be a legal person to conduct business anyway. What it is are hired agents acting on behalf of shareholders. They should still enjoy all the rights and priveledges of the shareholders in question.

I'm actually not sure what you're getting at here. It's not tsimply hat they conduct business that's the issue. At any rate, shareholders only have rights insofar as they hold a controlling interest, which most do not. It's the BoD, usually a sham democracy at best in U.S. corps, that are in charge.

quote:
After all, surely your rights and priveledges should not degrade just because there are more than one of you.
This is does not even qualify as tautological nonsense. It's pure nonsense. Rights are meaningful only with reference to individuals, which is why the corporation is more powerful as an "individual" person rather than a collectivity.

How can there be more than one of anybody?

quote:
Eitherway, I believe this protection is not necessary, and a world without such protections would still look predominantly like the world we currently enhabit in the western world
Since I don't know which protections you're referring to here, I can only guess that you mean corporate protections.

Why do you believe it would be the same? Do you think Wal-Mart could exist in its present day form without those protections? Or Blackwater?

I think you need to reconsider, especially in light of the fact that the 19th laws were passed for a reason, and with almost immediate result.

[ September 11, 2008, 12:04 AM: Message edited by: KidB ]

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LoneSnark
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Blackwater possibly not but Walmart would most definitely still exist without government liability protection.

quote:
Rights are meaningful only with reference to individuals, which is why the corporation is more powerful as an "individual" person rather than a collectivity.

How can there be more than one of anybody?

You misunderstand. Let us say me and ten friends get together and want to take a trip across the country in an RV, but all of us can only afford 1/10th of the RV. As such, we get together and sign a contract to pool our money and buy the RV with carefully outlined procedures for managing and disposing of the RV. Well, we have just by contract created a corporation. Maybe from our pooled money we hire a driver and pay for repairs, deciding which repairs to take by majority vote. The contract empowers individuals to sell their shares in the RV at any time to anyone we choose.

Well, this takes advantage of no laws passed by the legislature, just the human right to sign an unlimitedly complex contract and have it enforced. English citizens have been drawing up and signing just such contracts for centuries, long before the incorporation laws of the 19th century. The only difference is that if the RV is poorly maintained and kills the driver, then all 10 of us are liable to the drivers widow. That is the only change.

Now, most corporations in existance today face fairly limited liability potentials. A truck owned by Walmart could take out a bus full of nuns, the roof could collapse killing hundreds of customers. Either way, the losses to these disasters would still be less than the equity of the company. The only corporations that do exist today that would not exist without government provided liability protection would be nuclear power plants (whose potential liability is almost limitless) and mine operators out west that extract the ore, return dividends, and close shop before the lawsuits come due for polluting the ground water of the surrounding country-side.

quote:
especially in light of the fact that the 19th laws were passed for a reason, and with almost immediate result.
They were passed for a reason. It was because back then without computers, typewriters, or even good pens, making someone pay taxes was difficult. The only way to do it reliably was if they wanted to pay the tax. As such, the government struck a deal with the corporations, you agree to self enforce a corporate tax and we will exclude your corporation from liability.
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KidB
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quote:
Blackwater possibly not but Walmart would most definitely still exist without government liability protection.

Once again, "existence" is not the point of contention. Would Wal-Mart be powerful enough to demand specification changes of the manufacturers it carries, and would it be able to pressure factory supervisors in other countries to change their labor policies if it didn't have liability protection, and personhood, and first amendment "protection" to advertise using publicly paid for infratructure, and tax advantages over local businesses? No, it would not.

quote:
You misunderstand. Let us say me and ten friends get together and want to take a trip across the country in an RV, but all of us can only afford 1/10th of the RV. As such, we get together and sign a contract to pool our money and buy the RV with carefully outlined procedures for managing and disposing of the RV. Well, we have just by contract created a corporation. Maybe from our pooled money we hire a driver and pay for repairs, deciding which repairs to take by majority vote. The contract empowers individuals to sell their shares in the RV at any time to anyone we choose.

No, I understand your point about freedom of contract. Isn't your RV more of a proprietorship?

Are your shares going to be publicly traded?

Apparently, you have no idea how many regulations and laws make a corporation publicly reliable, including accounting standards. As opposed to "some dudes buying a truck together."

[ September 11, 2008, 05:10 PM: Message edited by: KidB ]

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KidB
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quote:
They were passed for a reason. It was because back then without computers, typewriters, or even good pens, making someone pay taxes was difficult. The only way to do it reliably was if they wanted to pay the tax. As such, the government struck a deal with the corporations, you agree to self enforce a corporate tax and we will exclude your corporation from liability.
That's basically what I said in my opening post.
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Colin JM0397
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A perfect example of how the government protects the corporate giants (you can google away and find all this very easily), I'm going from memory and things I've read recently.

Everyone has seen those smiling guy ads for the male enhancement product "Enzyte", right? That was made and promoted by a private company. The main guy just got 25 years - yes, 25 - in jail for a multitude of crimes, some not having to do with the product, but many charges having to do with false marketing claims.

Juxtapose that against recent reports of major Pharmaceutical companies falsifying toxicology and efficacy reports… And this “The Food and Drug Administration (FDA) estimates that Vioxx may have contributed to 27,785 cardiac arrests...”
Twenty-seven-thousand-seven-hundred-eighty-five deaths linked to Vioxx.

How many people's death were linked to Enzyte?
Zero.

How many Merck executives and scientists are liable for jail time for those estimated 27K deaths caused by their product?
Zero.

Of course to find Merck criminally liable, you'd have to find the FDA also liable, and we just can't have that, can we?

[ September 11, 2008, 05:21 PM: Message edited by: Colin JM0397 ]

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TCB
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KidB said:
quote:
Would Wal-Mart be powerful enough to demand specification changes of the manufacturers it carries, and would it be able to pressure factory supervisors in other countries to change their labor policies if it didn't have liability protection, and personhood, and first amendment "protection" to advertise using publicly paid for infratructure, and tax advantages over local businesses?
KidB, I can understand objecting to corporations having liability protection and tax advantages, but what's the problem with corporate personhood? It seems to me to be nothing more than a legal simplicity. In place of the corporation name you could just name all the share holders (whether there are just a few or several thousand), and it wouldn't be fundamentally different - just less convenient.

Also, why shouldn't a corporation have first amendment protections? A group of people have the same right to freely issue statements as a single person does.

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KidB
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quote:
KidB, I can understand objecting to corporations having liability protection and tax advantages, but what's the problem with corporate personhood? It seems to me to be nothing more than a legal simplicity. In place of the corporation name you could just name all the share holders (whether there are just a few or several thousand), and it wouldn't be fundamentally different - just less convenient.

Also, why shouldn't a corporation have first amendment protections? A group of people have the same right to freely issue statements as a single person does.

Briefly, you are granting all the legal rights of an individual to an entity that has none of the limitations of an individual.

I'll elaborate on 1A rights tomorrow (my concern involves advertising and big media primarily).

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LoneSnark
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And what are the limitations of an individual that a large group of individuals does not face? They are all going to die eventually, they all can be arrested for criminal activity, they all can be sued, and they all feel the need to be liked.

So, we await your explanation of why an individual should lose some of their rights the instant they throw their lot in with other individuals.

quote:
Once again, "existence" is not the point of contention. Would Wal-Mart be powerful enough to demand specification changes of the manufacturers it carries, and would it be able to pressure factory supervisors in other countries to change their labor policies if it didn't have liability protection, and personhood, and first amendment "protection" to advertise using publicly paid for infratructure, and tax advantages over local businesses? No, it would not.
I have looked into it, Wal-Mart does enjoy very real economies of scale from its distribution network, therefore it most definitely could compete without the tax advantages and liability protection (again, very little liability in Wal-Mart's court). And yes, since Wal-Mart would still exist, it would have the same rights as any customer and sign infinitely complex contracts with manufacturers. Afterall, manufacturers are free to refuse, as such Wal-Mart will never ask a manufacturer to do anything it is not willing to do.

And see above, we are not asking for personhood, just for the shareholders of Wal-Mart to enjoy the same rights, priveledges, and consequences as anyone else. That includes the right to free speech.

[ September 12, 2008, 03:12 PM: Message edited by: LoneSnark ]

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KidB
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LS,

I'm a little bit torn on just how much time I should spend trying to explain the obvious here.

So let me start with a more fundemnteal question - if you think all of these protections are largely irrelevent, why do you think they exist in the first place?

Onto your other comments:


quote:
And what are the limitations of an individual that a large group of individuals does not face? They are all going to die eventually, they all can be arrested for criminal activity, they all can be sued, and they all feel the need to be liked.

I'm amazed that you need to ask. Corporations are immortal, and can amass wealth far beyond any one person. That's the whole point - removing those limitations, so that ivestors cannot be sued. Those who are putting up a large portion of the capital in publicly traded companies are doing so largely because they can treat them as income-generating machines. That they have no liability aside from a modest investment risk means that far more people will invest than normally would. This is what makes it possible for corporations to become so incredibly huge.

You keep talking about "freedom of contract" in a presumed state-of-nature in which people can freely pay for a business enterprise together. But contract enforcement requires a government (or at least a few hired guns). Simple contracts, like those required to start up a local horseshoe shop, requite little govt to enforce - just a local sheriff and judge. But limited liability on the scale of a big corp requires much more government intervention.

Do you still not undertand the importance of this distinction?


quote:
we await your explanation of why an individual should lose some of their rights the instant they throw their lot in with other individuals.


That's not my argument. No individuals lose rights as individuals.

quote:
And yes, since Wal-Mart would still exist, it would have the same rights as any customer and sign infinitely complex contracts with manufacturers. Afterall, manufacturers are free to refuse, as such Wal-Mart will never ask a manufacturer to do anything it is not willing to do.

You really don't understand. You can sign whatever ever kind of contract you want. But people (if they know what they're doing) only sign contracts that they know are legally binding, and for a contract to be legally functional it must be recognized as such by the government. Why? Because if someone breaks the contract, what's your recourse to make them perform? You'd have to sue them, of course. Likewise, if someone tries to go after you for money that your contract with them says you do not owe, how do you protect yourself from having them take you to the cleaners? In both cases, this requires a judicial system which has decided which kind of agreements are legal and which are not. Modern contract law is a mind-numbingly complex, especially as it pertains to the corporation. The legal precedents which support it are not "natural" in that they could never have arised from mere common practice in a laissez-faire environment. Contract laws, as well as other laws relating to corporate liabilty, are often written to benefit the elites that run them.

I'll try an extremely simple but pertinent example I mentioned earlier (perhaps in a seperate thread). Department of Housing decides to build "low-cost housing" because there is political pressure to do so. City collects tax revenue, and city creates a corporation which will manage and run the high-rise facility as a private enterprise. The buildings are ugly and cheap, and the corporate owners of the facility then refuse to pay for adequate police protection. As a result the projects become magnets for criminal enterprises. Tenants sue their landlord after someone is murdered in the building. City court dismisses lawsuit, on the basis that a landlord is not liable for crimes committed in the building, nor need he provide his own private police force. In essence, the city has used the Corporation as a tool of govermnet power, and then hiding behind the facade of privacy - all as a means to keep the local dark-skinned folk out of sight, out of mind. This is real. It is Newark in the 1960's.

Now, understand this principle operates virtually everywhere. Chain stores and franchises do not appear on the scene from some state of boot-strapped rugged individualism. They appear in your town because laws have been written making it easier for them to be there than any of the local business, because the city-state-whatever wants more tax revenue and will bend heaven and earth to get their wealth-engine in there. "Our economy" is motive. Reams of laws are written to give the corporation primacy. Corporations do not just buy land and resources that happen to be available, they buy availability in the form of political influence, lobbying, and decades of legal precedent which favor them. They use the favoritism they've already been given to buy still more favoritism.

quote:
Afterall, manufacturers are free to refuse, as such Wal-Mart will never ask a manufacturer to do anything it is not willing to do.

No they're not! Wal-Mart is now powerful enough that if the manufacturers refuse, Wal-Mart threatens not to carry them, and they go out of business. If the factories refuse, the factories close. And so forth. These are powers that were handed not to Wall-Mart specifically (well, in some cases yes) but result from precedent that rewards bigness and punishes smallness. The govt. is just as selfish as everyone else - it passes laws and recognized contract precedents that will maximize tax revenue, not secure individual rights. And then we eventually get to the point where the corporation is powerful enough to use the govt to protect its own primacy.

Quoth the owner of my favorite (now closed) bookstore in Boston, Avenue Victor Hugo, on why his store is now closed:

quote:
1. Corporate law (and the politicians, lawyers, businessmen and accountants who created it for their own benefit)--a legal fiction with more rights than the individual citizen, which allows the likes of Barnes & Noble and Walmart to write off the losses of a store in Massachusetts against the profit of another in California, while paying taxes in Delaware--for making ‘competition’ a joke and turning the free market down the dark road toward state capitalism.


and your last

quote:
we are not asking for personhood, just for the shareholders of Wal-Mart to enjoy the same rights, priveledges, and consequences as anyone else. That includes the right to free speech.

The individuals all have the same rights as it is - as individuals. If the corporation functioned with the same ethical reciprocity as you would expect from any normal human, there would be no problem. If it were an actual "democratic" business, there would be less of a problem. But it is not and does not - the law shields it.

[ September 12, 2008, 05:04 PM: Message edited by: KidB ]

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TCB
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KidB: Let's say 9 people and I start an engineering firm, with each of us owning an equal share. Say this takes place in a fictional US in which corporations have no limitations on liability, but have personhood and freedom of speech. We could be personally bankrupted by lawsuits, so we're careful to always behave lawfully.

Say we're very successful and eventually have 1000 employees working for us - that is, we become wealthy and powerful. We shouldn't have any right to free speech - e.g. to issue press releases, advertise, hire lawyers to petition congress on behalf of our shared interests, etc.?

Purely as a practical matter, restricting the free speech of corporations doesn't make sense to me. I could agree with my partners to do each of those things (say, with a majority vote), but then formally execute them in my name alone, and be Constitutionally protected.

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KidB
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quote:
Let's say 9 people and I start an engineering firm, with each of us owning an equal share. Say this takes place in a fictional US in which corporations have no limitations on liability, but have personhood and freedom of speech. We could be personally bankrupted by lawsuits, so we're careful to always behave lawfully.

Say we're very successful and eventually have 1000 employees working for us - that is, we become wealthy and powerful. We shouldn't have any right to free speech - e.g. to issue press releases, advertise, hire lawyers to petition congress on behalf of our shared interests, etc.?

A few things. One is that I haven't really gotten fully to 1A yet (just lack of time - sorry! [Smile] ). But I'll do my best here.

Advertising has never received the full protection of other forms of speech. There are and have always been special strictures on advertising, though the degree to which the strictures deviate from other forms of speech have varied greatly. Most of the past 30 years has been towards greater freedom (for the worse, I would argue).

Now, let's assume for the sake of argument that I'm taking a strict libertarian stance with regard to individual rights and private business. The question then is to what extend we recognize the corporation as an individual. A collectivity of persons does not generally speaking hold a single "view" on every subject under the sun - rather they are in agreement as a "person" (which in fact they may not be, but rather by majority rule) only with regards to the corporation's interests qua its status as a corporate entity - these include things that "only a corporation" could care about.

A corporate person is therefore a different entity from a human person. It does not need food and shelter, does not fall in love, is not mortal. A human person cannot have his human-hood charter revoked, nor be purchased in a leveraged buyout. A corporation does not walk into a voting booth and pull the lever, nor does it get married, and so on.

If you are to consider a corporation as a person, you'll have to admit its interests are completely different from any person you know. The interests of the human beings who run it and invest in it are of course normal human desires, but the rights of said human persons are not in play - they still have individual rights even if no corporation is legally recognized at all.

At question here is whether or not the government agrees to enforce these special, wholly artificial conceptions of personhood - which is a useful fiction and nothing more. One does not normally go around granting personhood to things, and a corporation is a thing, not just some uber-human.

That being said, the "corporation" you describe isn't really a corporation, but more of a business collective. Limited liability is the primary defining characteristic - without it, all else is dross. No LL, and who's going to invest initially? Some close friends might, but who else? No matter how successful your products, lack of LL will place very serious and sobering restrictions on the amount of capital you can raise, so while you may grow wealthy it will take time, and your wealth will be modest compared to that of the modern corporate entity.

What you describe is far less a threat than what actually exists. So if this collective business wanted to express itself in whatever way it wished - then cool, I guess, though with the caveat the advertising still faces greater restrictions than other speech in any scenario.

[ September 13, 2008, 01:12 AM: Message edited by: KidB ]

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KidB
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quote:
Purely as a practical matter, restricting the free speech of corporations doesn't make sense to me. I could agree with my partners to do each of those things (say, with a majority vote), but then formally execute them in my name alone, and be Constitutionally protected.
I would just add here that you seem to implicitly state that a corporation is "naturally free" as is a human being, and that its freedom can only be impinged upon, and that your speech and your corporation's are somehow commensurate. Not so! By law, the corporation is a thing unto itself - legally its "own person." Microsoft is not the "same person" as Bill Gates. Microsoft is Microsoft. Bill is Bill, and he has freedom of speech. Does Microsoft?

Unlike a human being, whose rights are considered intrinsic, and therefore subject only to protection or violation, a corporation's rights are created. So I would argue that the question is not, why shouldn't they have freedom of speech, but rather, why should they?

[ September 13, 2008, 01:23 AM: Message edited by: KidB ]

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quote:
We could be personally bankrupted by lawsuits, so we're careful to always behave lawfully.


And there you have it. [Wink]
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RickyB
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Lone Snark, some holes in your arguments:

1) The right to contract is independent of government. The enforcement of resulting contract, is, how shall we say? Not.

2) "And what are the limitations of an individual that a large group of individuals does not face? They are all going to die eventually, they all can be arrested for criminal activity, they all can be sued, and they all feel the need to be liked."

Of these, only the middle one sorta applies. The corporation can't be "arrested" - merely taken apart or put under limitations, but punished as well. Corporations do not necessarily die, and don't feel the need to be liked except strictly as expressed by the bottom line.

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RickyB
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KidB - what you say is true, but you give the answer yourself:

"Limited liability is the primary defining characteristic - without it, all else is dross. No LL, and who's going to invest initially? Some close friends might, but who else? No matter how successful your products, lack of LL will place very serious and sobering restrictions on the amount of capital you can raise, so while you may grow wealthy it will take time, and your wealth will be modest compared to that of the modern corporate entity."

We need the flow of csh created by LL too much to revoke it, despite all the harm.

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Jesse
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" I could agree with my partners to do each of those things (say, with a majority vote), but then formally execute them in my name alone, and be Constitutionally protected. "

Yes, and personally liable for any illegality commited. Right back to the Enzyte example.

A private individual dumps waste oil in a river, she goes to jail and her business shuts down for good.

A manager at a Dow plant orders an employee to dump waste oil in a river, the Corporation shells out a couple million in fines and goes chugging right along. The individual manager might be fired, or even jailed, but the penalty is still far smaller.

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munga
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folks,

Let me draw up an idea that you can then ignore if you want to:

I believe LS is a banker of some sort. He may only be on a board, or he may be directly involved. Bankers have the view that when they participate in large projects with complex contracts, that the law will come down to protect them, as it usually does. If anyone is going to get creamed it will be the investors.

LS, like some engineering friends of mine, feels that the laws protect because to him, they do. I had a similar argument with an engineer not too long ago, an echo of this thread:

Why don't we just find out the spec and meet the spec?

Because the spec assures low production, which damages the prospects of this plant's performance

But if we meet the spec, they won't be able to say no

No, engineer, the only reason that works for you, is because your banker and the congressmen have already agreed to go forward and your production of "spec paper" is a technicality, not actually related to the viablity of your project. your project is meant to improve a design that hasn't been challenged,in order to transfer money from the taxpayer to your corporation

How can you say that!

Because your spreadsheets dont work, because your spec is crap

That spec was approved twenty years ago

Exactly, it is twenty years old, who revises the spec?

We meet the spec!

I bet you do, but on this project, we are not going to "turn in a spec report" and suddenly find that the doors "open" for us because the doors you THINK open for you because of an outdated spec were only paper. We are not turning in a spec that doesn't meet the project requirements. This is the nature of a business that the government is in collusion for (in other words, has a reason to provide tax dollars or access to tax or pension money to) and one that is in COMPETITION with the entities that HAVE collusion. We aren't that lucky, so NO we are not going to submit a report that means the project cannot be funded because we have actual EYES reading it!

Now, that conversation doesn't have direct bearing on this conversation until you take it from a banker's perspective. I'll give an example:

in the 1980s several independent natural gas operators noticed that they were supplying decatherms to the utility, which utility was marking up the price 40x. They demanded to re-negotiate. The utilities notified the independents that all their Take or Pay contracts (which were the means whereby they were paid) would not be honored. The independents sued, the judge determined on a class action basis that the independents had open access (FERC 488) to the pipeline. Then the utilities shut down the pipelines (parts of El Paso) in order to stomp the independent operators who then went into receivership. That meant, that the banks became the new operators, which then meant the the operations were auctioned to the utilities.

Who got bit? The indepentent operators and their investors. Who was just fine? The bank and the monopolies.

You see, LS takes the view that the law will protect him, because it does. You take the view that the law will not protect you, because it doesn't.

Ok, now you all can go back to arguing whatever you wanted to, I just put that in as a side-note on the character of the discussion.

[ September 13, 2008, 04:12 PM: Message edited by: munga ]

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KidB
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quote:
We need the flow of csh created by LL too much to revoke it, despite all the harm.
That may be true, Ricky, but I am not (here) arguing for the abolition of all things corporate. Mostly, I'm just trying to turn the usual discussion inside-out, by pointing out that the usual "free-market" arguments used by politicians to defend the corporate status quo are fundamentally disingenuous. Since corporations are state creations to begin with, there is no free-market or libertarian premise for defending their astonishing power and wealth as the result of "earnings" that they achieved on their own. I'm saying that either we don't have them at all, or if we must have them, they should work for our benefit, us being "the people." But we do not (should not...) create them for their own benefit, or for the benefit of the State's interests beyond what the state must do for us. Someone might start a business for their own motives and no one else's, which is fine, but an entity which is created by the state must not be served by it. I'm really suggesting returning to the spirit of the concept of the charter - giving it teeth and making it count if we must make use of corporations at all.

[ September 13, 2008, 06:48 PM: Message edited by: KidB ]

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