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Corporations

37 posts in this topic

JeffT: When I first read Welch's piece in the WSJ, the first thing I thought was "Does this guy really know what he is talkin about?". Not on the face of his remarks. Someone essentially objected to the effect of "Look who he's talking to". Well, corporations are just people, nothing more, flies in the face of the experience of most literate normal every day citizen of the Unites States.

I started this in the Metaphysics.Let's apply a version of Ayn Rand's method the "corporations". Let's look at all the real, actual associations of individual human beings owning and operating a corporation in the United States of America. How many do not include approval by some government to conduct business as a corporation? If there are none, then if a putative concepy "corporation" does not inlude government license, then to what does it refer? If we agree there should be but are never referants that do not include state license, what are the consequences for how we think about things and apply our thougths to dealing with the real world?

I think people seldom know for certain what they mean by a lot of concepts; that is I think many people by habit and "training" use concepts that prove "fuzzy" at bests if they, the speakers, are pressed. Some people, I call them Perfectly Postmodern Progressives, use language and thought that way deliberately.

I am rereading the section of AS set in Galt's Gulch and I just reread the section where Midas Muliigan rents his car to John Galt for 25 cents a day; when Dagny is surprised, Galt essentially says they lived, just then, in a world where they need to explicitly practice fair trade in all things, suggesting that in a rational world Mulligan could lend his car to a friend and not be misunderstood. There is an analogy to the world we live in right now; fuzzy answers like Welch's are inadequate and are often dismissed by smart people, noy just philosphers and intellectually sophisticated people.

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What you won't do is explain what it is about corporations that you object to.

JeffT: When I first read Welch's piece in the WSJ, the first thing I thought was "Does this guy really know what he is talkin about?". Not on the face of his remarks. Someone essentially objected to the effect of "Look who he's talking to".

Could you quote the passage(s) you're referring to in the above?

As has been said before, reminding you that Levin addresses a specific audience with a specific outlook doesn't deride the "average American" -- it simply reminds you to factor in the context of Levin's statements when analyzing them. Same applies to posts here or to any statement addressed to any audience.

And could you, once and for all, please define who the average American is and what you think he thinks of corporations, what experiences he has that make him think that?

Well, corporations are just people, nothing more, flies in the face of the experience of most literate normal every day citizen of the Unites States.

In what way?

Let's look at all the real, actual associations of individual human beings owning and operating a corporation in the United States of America. How many do not include approval by some government to conduct business as a corporation?

None.

If there are none, then if a putative concepy "corporation" does not inlude government license, then to what does it refer?

What magical thing happens when a government acknowledges that a corporation has been formed? What is it that you or the people you refer to as average Americans are concerned with? It's not obvious, and you haven't spelled out your/their objections even though you've been asked to do so a couple of times.

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Let's look at all the real, actual associations of individual human beings owning and operating a corporation in the United States of America. How many do not include approval by some government to conduct business as a corporation?

They only include approval because coercive government requires it. In a free society, a group of shareholders would sign an incorporation agreement and bylaws, with whatever level of evidence (witnesses to signatures, public announcements, etc.) would satisfy a court of law if future litigation might require it.

If there are none, then if a putative concepy "corporation" does not inlude government license, then to what does it refer?

It refers to a contractual arrangement in which one or more persons jointly delegate decision-making authority over property that they initially owned outright to an agreed-upon process.

(This process, in practical terms, often involves methods for electing a board of directors, who in turn either vote on decisions, and/or vote on appointment of executive officers.)

In a free society, you don't need license to dispose of your own property, and you don't need license to contract with others.

If we agree there should be but are never referants that do not include state license, what are the consequences for how we think about things and apply our thougths to dealing with the real world?

The same as when we recognize any other form of coercion by government. We oppose the coercion, not the acts that the coercion attempts to forbid or control.

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Instead of "Crony Capitalism" why not simply call it "Crony-ism"? After all the concept it reffers to is only made possible by the "mixed" part of our economy and not what's left of the "Capitalism" part.

"Crony Capitalism" is a term that brings discredit to capitalism. It has some superficial resemblances to real capitalism.

Here is a nasty concept cooked up by people who dislike and disdain capitalism. It is a propaganda tool, not an accurate characterization of capitalism. Compare the doings of Bert Ruytan (who is an aeronautical genius) with the doings of General Motors in the last 30 years. General motors made more profits from loans than inventing, designing and selling innovative automobiles and truck.

ruveyn

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Instead of "Crony Capitalism" why not simply call it "Crony-ism"? After all the concept it reffers to is only made possible by the "mixed" part of our economy and not what's left of the "Capitalism" part.

"Crony Capitalism" is a term that brings discredit to capitalism. It has some superficial resemblances to real capitalism.

Here is a nasty concept cooked up by people who dislike and disdain capitalism. It is a propaganda tool, not an accurate characterization of capitalism...

Yes, it's a package deal intended to misrepresent capitalism in a way that is in fact the form of socialism that is fascism, which they have been trying to do in many ways ever since the 1941 breakup of the Hitler Stalin pact. The kinds of fascistic arrangements they refer to as 'crony capitalism' is not only the opposite of capitalism, it unfairly denigrates cronies.

The left also uses it to denigrate the corporations it hates as it tries to demonize business corporations as some kind of monster entities that are not people. That is why the Welch article reminded everyone that corporations are the people they consist of, and it is the people, primarily in business, that the left is attacking.

The term 'crony capitalism' should not be used at all and should be identified and denounced for what it is, along with the fascism it means. Notice that when the left wants to promote its fascism it calls it a "public-private partnership". It is only capitalism that they are out to smear and obliterate.

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The purpose of this post is to begin to clean up whay seems like a mess i made with the origin of this thread. It may be noticed that the last few posts I've made have started with "the purpose of this post...". despite my every resolution, my posts often start as "stream of consciousness" posts; not a good thing, in many respects, among a group of methodicla thinkers. In this case, as I often observe in popular culture, a speaker employed a concept - corporations - in a way that made me think there are no concrete referents that include the requisite characteristics of a solid concept of corporation. If so, the writer literaly does not know what he's talking about; moreover, as a consumate crony statist (in my observation) he uses the erstwhile concept, consciously or not, to obscure the real issues, not to calrify anyone's thinking.

One of the objections raised to my thoughts was that corporations are the object of the police power of the state. Corporations can be sued, can be made to pay compensatory damages, can be made to pay criminal fines and can be compelled to do acts to mitigate any damages they cause. But can they?

General Motors, for example, is just fine. (At least if you believe the press). But Rick Wagoner is ruined; it wasn't General Motors sitting in a chair with that poisonous toad Barney Frank sneering at it, it was Rick Wagoner. It wasn't General Motors being shamed for using the efficient corporate jet and being humiliated by being coerced into driving a government approved electric car to his next public beating. It wasn't General Motors whose life savings of $100,000 invested in "her company's" bonds that was wiped out by fiat, no due process necessary; it was a good, if foolish, little old lady in Bay City Mi. It wasn't General Motors that had its pension and post retirement medical benefits wiped out by sneering dictat, it was the salaried workers at Delphi, for whose benefits GM was judged liable in an ordinary court. It wasn't GM whose business was destroyed by brown shirt fiat, it was hundreds of successfull small businesses, car dealerships, many of whom were third and fourth generation businesses; a hundred thousand or more employees who lost jobs, benefits, pensions and more.

Several people objected to my views by asserting that corporations are "merely" pass throughs. Well, so they are, but not merely. Everything that happens to a corporation eventually registers in the ownership or creditor interests of of natural (biological, identifiable) human beings. They incurred costs, the most basic the time and energy of their lives, to involve themselves with GM or any corporation.

At the limit, at the end of the line, where the buck stops, where the rubber meets the road is a human being. The police power of the state may operate indirectly, but in the end it operates only on natural human beings.

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Since the rest of us have known all along that it is about the state versus individual human beings, what is your point?

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You seem to confuse actual corporations with what often passes for a corporation in a mixed economy. And you've yet to spell out the exact issues you have with corporations in either context.

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I will be grateful to receive anyone's comments on the one point raised just above concerning the bearing of the law and, hence, the police power of the state on, and only, ultimately, on natural (human, non abstract) human beings. THX.

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I will be grateful to receive anyone's comments on the one point raised just above concerning the bearing of the law and, hence, the police power of the state on, and only, ultimately, on natural (human, non abstract) human beings. THX.

It's already been commented on. From my post above:

The idea that corporations are not really people is a red herring, and states nothing. Of course they're not; it was always an intentional abstraction. The issue is freedom of association and freedom of contract.

All the essential things a corporation does could be done via contract law alone, but in a very complex, convoluted manner. Corporations are the mechanism to recognize a standard arrangement.

In the first thread where I entered debate with you, I made a post iterating on how each type of more complex organization (from an individual acting alone, to a partnership, to a corporation) was an instance of freedom of association and contract, and not any special privileges granted by force. At this point I have no more patience to keep repeatedly looking up my old quotes and old links. I've done it before (several posts up, with links to the earlier threads), and any reader or yourself can do so.

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A corporation is an entity in the sense that it is a business formed by agreement between the owners thereof who then sell some of its shares to others. The idea behind limited liability is that it is unjust to make a mere investing shareholder liable past his investment for corporate torts or contract breaches. When you do business with a corporation, you accept the limited liability. This statement is prior to law recognizing the above economic arrangement. That the directors and managing parties are equally shielded from liability is philosophically wrong and legally incorrect. Their liability can be established legally It is called "piercing the corporate veil" Nor are corp officers , nor yet shareholders at any level, free of liability for their own criminal or wilfully tortious actions. There is more to say on this too.

William W Kaufmann (attorney, professor)

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