TT`s Lost in Tokyo : corporations

"Clear-sighted" panic; the role of the corporation in the tragedy of the commons

TokyoTom — Sun, 30 Aug 2009 17:00:00 GMT

This is my fourth follow-up post to "Grist and the tragedy of the panicked enviro", where I try to clarify the institutional frameworks for understanding and addressing resource problems, in response to confusion in comments by others.

Here is my most recent comment:

Cyberfarer, thank you for your response [here], which is well-intentioned, but both perceptive and blind.

First, I see you`ve adopted a page from the climate "skeptics" playbook, by applying the sefl-deceptive ad hominem device of labelling those you disagree with as "true believers" in something. This is a partisan tactic that lets you treat others as enemies, and spares you from the trouble of listening to them, trying to figure out what they`re saying and responding the them, as opposed to a black and white strawman that you`ve conjured up. Congratulations on mirroring those whom you dislike most.

Second, with all of your clear thinking, like Mr. Sacks, you offer us no practical advice, just reasons for despair. Lezlie, who follows you, at least provides an agenda.

Third, of course, you`ve got me all wrong; I`m not an ideologue, a "true believer" or even an apologist of any kind the status quo; I`m a concerned human being, a fellow traveller on Plante Earth and a pragmatist. You`ve been misreading me, and certainly have not troubled yourself to consider the very pragmatic analytical tools that I`ve offered to help you figure how to diagnose and attack the problems that you perceive.

And what have I offered? Nothing more or less than the rather obvious observations that resources that are not owned and managed - whether privately or by groups (including, obviously, by communities and native peoples) tend to be trashed, and that similar problems are experienced where resources are formally "owned" by governments but essentially used by elites for their own benefit. I have NOT argued that private property is the cure-all, nor have I condoned theft nor the manipulation of governments by elites. In fact, I have rather clearly pointed out that both theft and misuse of governemtn have been and remain very much a part of the problem.

Fourth, you continue to misunderstand the nature of our problems, and want to lay everything at the foot of "capitalism" and "markets", when the real problem is either the lack of ownership of resources or government fiat/theft. Western capitalism is not responsible for extinctions and environmental devastation that preceded capitalism and markets, or that has taken place under state-directed economies. This gets old, but look at the prior extinctions, messes of the former USSR (and at the Aral Sea today), Hanford and Rocky Flats, Haiti, and China.

Sure, the consumer and industrial supply demands of markets (not merely in the West) continue to pull chains of destruction elsewhere in the world, but destruction only occurs with respect to resources that are not owned and protected (or where theft by those more pwerful occurs). Tofu and meat eaters alike are indirectly responsible for rainforest destruction, mainly because governments "own" most the rain forests and don`t prefer to protect native title wher it is recognized, so the conversion of such land into soybeans (or palm oil to feed government-mandated demands for biofuels) continues.

In any case, is it more effective to wail about the evilness of corporations that compete to provide us ever more cheaply things that we choose to buy, or to demand better property rights protection abroad, pay closer attention to where our food comes from and end domestic mandates that drive destruction? You`re welcome to your rants against true believers like me, but I`m personally more disposed towards trying to be practically effective.

Fifth, you are very right to criticize corporations; Mr. Sacks has had a history of doing that. Not only do I agree with much of his analysis (which he has not provided here), but I`ve devoted a fair amount of time to examining the entanglement of corporations and government: http://mises.org/Community/blogs/tokyotom/search.aspx?q=limited

Our state governments were wrong to get into competition with each other to grant corprate status to investor-owned enterprises, in exchange for fees and later taxes. Corporate status freed investors from down-side risk, by limiting liaibility to the amount of capital contributed. This incentivized: investors to encourage corproations to embark on risky activities that shifted costs to innocent third parties; the concentration of wealth in corporations; the corruption of the court system that once protected third parties from damages caused by others (by replacing strict liaibility with balancing tests); and the ensuing battle - that you noted - over legislatures to regulate corporations (and courts to enforce regulations). Is there a takeaway on this. other than continuing to fight political battles to block legislative sweet deals and theft, including working to revise our corporate order?

Anyway, I wish you well in your tirades.

[Update] Rot at the Core: Rob Bradley at "free market" MasterResource blog shows his true colors as a rent-seeker for fossil fuels

TokyoTom — Wed, 11 Mar 2009 11:27:00 GMT

[Update: I`ve added more background on Exxon, "Malthusians" and productive engagement.] How has Rob Bradley showed his hand? By shutting down reasoned (if challenging) debate at his blog, in the face of comments that were certainly more "free...(read more)

Dialogue with Stephan Kinsella on the state grant to shareholders of limited liability for corporate torts - a gift that keeps on giving

TokyoTom — Mon, 22 Dec 2008 09:53:00 GMT

Stephan Kinsella , in two recent blog posts, Left-Libertarians on Corporations "Expropriating the Efforts of Stakeholders" and Corporations and Limited Liability for Torts , kindly provided a forum to discuss the issue of the limited liability...(read more)

Legal resources on state-created limited liability for shareholders, consequences and reform

TokyoTom — Tue, 16 Dec 2008 06:25:00 GMT

Here, in chronological order, are some legal resources on state-created limited liability for shareholders: history, alternatives, consequences and reform: Christopher D. Stone, "The Place of Enterprise Liability in the Control of Corporate Conduct"...(read more)

[Revised] Corporations, the state, limited liaibility and rent-seeking: Some criticisms of Huebert and Block's criticisms of Long

TokyoTom — Wed, 26 Nov 2008 10:35:00 GMT

[Update: Items 2 & 3 revised and an item 4 added.] J.H. Huebert and Walter Block have posted a critique of Roderick Long 's recent Cato essay . Allow me to make a few comments: 1. Huebert and Long argue that "There Is No Such Thing as Corporate...(read more)

Bali: Murdoch & 149 Other Top Vile Collectivists/Capitalists Call for Global Poverty ...

TokyoTom — Mon, 03 Dec 2007 20:19:00 GMT

and for a legally binding UN framework to tackle climate change. Just who are these vile collectivists, red enviros, misanthropes, and others caught up in the totally groundless AGW hysteria?

[Snark Alert!]

Let's go to FOX News - which headlines "Top Corporations Demand Action on Global Warming". Fox says that "more than 150 global companies — worth nearly $4 trillion in market capitalization — have signed a petition urging "strong, early action on climate change"". Amazingly, the news report ends with a disclainer: "FOXNews.com is owned and operated by News Corporation, which is among the signatories of the Bali Communiqué." http://www.foxnews.com/story/0,2933,314224,00.html

Just what the heck is going on?

On November 30, UK and EU Corporate Leaders Groups on Climate Change (spearheaded by the Prince of Wales) published the "Bali Communiqué", by which leaders of 150 global companies encouraged world leaders to work for a comprehensive, legally binding United Nations framework to tackle climate change.

The Bali Communiqué calls for:

"a comprehensive, legally binding United Nations framework to tackle climate change";
"emission reduction targets to be guided primarily by science";
"those countries that have already industrialised to make the greatest effort"; and
"world leaders to seize the window of opportunity and agree a work plan of negotiations to ensure an agreement can come into force post 2012 (when the existing Kyoto Protocol expires)"

The vile collectivists provided the following business case:

"The scientific evidence is now overwhelming. Climate change presents very serious global social, environmental and economic risks and it demands an urgent global response.

"As business leaders, it is our belief that the benefits of strong, early action on climate change outweigh the costs of not acting:

"The economic and geopolitical costs of unabated climate change could be very severe and globally disruptive. All countries and economies will be affected, but it will be the poorest countries that will suffer earliest and the most

The costs of action to reduce greenhouse gas emissions in order to avoid the worst impacts of climate change are manageable, especially if guided by a common international vision

Each year we delay action to control global emissions increases the risk of unavoidable consequences that will likely necessitate even steeper reductions in the future, causing potentially greater economic, environmental and social disruption.

The shift to a low-carbon economy will create significant business opportunities. New markets for low carbon technologies and products, worth billions of dollars, will be created if the world acts on the scale required

"In summary, we believe that tackling climate change is the pro-growth strategy. Ignoring it will ultimately undermine economic growth.

"It is our view that a sufficiently ambitious, international and comprehensive legally-binding United Nations agreement to reduce greenhouse gas emissions will provide business with the certainty it needs to scale up global investment in low-carbon technologies. We believe that an enhanced and extended carbon market needs to be part of this framework as it offers the necessary flexibility, allows for a cost-effective transition and provides financial support to developing countries."

Companies supporting the communiqué included the following:

US-based: Coca-Cola, Dupont, Gap, GE, Johnson and Johnson, Nike, Pacific Gas and Electric, Sun Microsystems and United Technologies.

European-based: Anglo-American, British Airways, F&C Asset Management, Ferrovial, Nestle, Nokia, Rolls Royce, Shell, Tesco, Virgin and Volkswagen.

Australian-based: Insurance Australia Group, Macquarie, National Australia Bank, News Corporation and Westpac.

Chinese: Shanghai Electric, Zhufeng Technology and Suntech.

More here: http://www.balicommunique.com/communique.html

Well, it's clear that they are all deluded and don't care about impoverishing the rest of the world. They certainly know nothing about science, economics or the potential difficulties that their companies might confront in facing the challenges that they allege. They're just sycophants and fellow-travellers of the evil, misanthropic "watermelon" enviros. http://mises.com/blogs/tokyotom/archive/2007/12/17/holiday-joy-quot-watermelons-quot-roasting-on-an-open-pyre.aspx.

In other words, there's nothing here folks; move along.

Fighting over the wheel of government

TokyoTom — Tue, 16 Oct 2007 16:43:00 GMT

[update below] Fundamentalist states on an interesting thread: "Most Americans are outright socialists; the rest are socialist sympathizers. They believe that only the government can save them from capitalists."

In response, I raised the following questions:

Do you think Jefferson was wrong when he urged:

"I hope we shall crush ... in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country.
--Thomas Jefferson to George Logan, 1816.
http://etext.virginia.edu/jefferson/quotations/jeff5.htm

The concentrated wealth and long lives of corporations have long made them a special and powerful class of rent-seekers, eliminating liability for shareholders and vanquishing restrictions on life and acceptable business activities. Are citizens wrong to seek to counterbalance corporations, using in part the very tool of government that corporations have effectively seized?

Let me add here the comment that while ultimately the way forward lies in hacking back government, one cannot deny that rent-seeking by corporations has been and continues to be a major factor in politicizing and hardening conflicts that could otherwise be resolved privately. While bashing "socialists", "enviros" and other citizens groups, it behooves us not to forget the 800 lb. gorilla in the room.

[update in response to comments:]

I agree completely that the best way to lessen rent-seeking is to reduce the rents that are available through government.

This implies smaller government, but also suggests that we can make progress by focussing on breathing more life into the federalist structure of power-sharing with the states, the checks and balances between the branches of government, by limiting the ability of either political party to get a local lock on power by gerrymandering.

I appreciate the agreement that citizens are not wrong to seek to counterbalance corporations, but you've missed a point. Corporations are the 800 lb. gorilla not because of ongoing corporate welfare - that's simply the effect. Their powerful advantages over citizens in influencing government comes from their size and financial power, which derives from legislative grants of unlimited life, unlimited purposes and limited liability for their investors. To reduce government, some effort must be made to moderate these advantages.