Tag Archives: Society

Capitalism (6th)

More on Corporations

I keep waiting for the day when a corporate president expresses shame for a corporate transgression against the public or the environment.  The statement would go something like this:

‘ On behalf of my company,its management, and its shareholders, I wish to express our grief concerning injuries suffered by people living downstream from our factory, along the Green River.  We are ashamed to admit that, over the years, our poisonous wastes have found  their way into the river, putting the community in peril.  We will do anything to relieve the suffering we have caused.  We are also concerned that safe storage for such potent chemicals now seems impossible, and so henceforth we will only use our facilities for safer forms of manufacturing.  Under no circumstances will we give thought to abandoning the community or its workers. ‘  

No such statement has ever been made, nor ever will be made by a publicly held corporation in America, for several reasons.

No corporate manager could ever place community welfare above corporate interest.  An individual executive might personally wish to do so, but to make this sort of admission would subject the company, and the individual, to legal action by local, state, and federal authorities, as well as to damage suits by victims.

It could also open management to lawsuits from its own shareholders.

U. S. corporation law holds that management of publicly held companies must act primarily in the economic interests of shareholders.  If not, management can be sued by shareholders and firings would surely occur.  So managers are legally obliged to ignore community welfare (e.g., worker health and satisfaction, and environmental concerns) if those needs interfere with profitability.  And corporate managers must also deny that corporate acts have negative impact of any kind, if that impact might translate into costly damage suits that hinder profits.

Though corporations may enjoy many ‘human’ rights, they have not been required to abide by human responsibilities.

The most basic rule of corporate operation it that it must produce income, and (except for that special category of non-profit corporations) must show a profit over time.

Among publicly held companies there is another basic rule:  It must expand and grow, since growth is the standard by which the stock market judges a company.

All other values are secondary: the welfare of the community, the happiness of workers, the health of the planet, and even the general prosperity.


The above quotations, while unflattering, aren’t meant to be condemnatory of free-market capitalism.

My stance in this series of posts (Capitalism 1st – 6th) is that we can do capitalism better by determinedly eliminating its more glaring flaws, one of which is discussed above.

It seems reasonable to require that private profit be pursued within a matrix of government policy, law and regulation designed to stabilize or improve the quality of life for all persons, as well as preserving local and planetary environment.

All quotations from: Mander, Jerry—In The Absence Of the Sacred ISBN 0-87156-509-9

Disclosures:  I have neither formal training in law nor a financial interest in any book cited anywhere on my blog.

 

Throwing out the baby with the bathwater…

…aka “defunding the police”

Let’s talk turkey about eliminating professional police and replacing them with citizen safety committees.

Let’s imagine these amateurs dealing effectively with the mafias of Italy, Sicily, Russia, and Vietnam, also international terrorists, drug cartels…

and a constantly varying mixture and frequency of burglary, arson, rape, murder, kidnapping, counterfeiting, robbery, prostitution, missing persons, bar fights, drunken driving, vandalism, disorderly conduct, malicious mischief, cruelty to animals, identity theft, traffic jams, hate crimes, rowdy demonstrations, maybe a riot… any or all of this,

plus directing traffic, escorting funeral processions, dealing with trespass complaints, investigating collisions, shooing away loiterers…

all the while enforcing weapons laws, and maybe serving a search or arrest warrant on the sort of psychopathic felon who’d rather kill a cop than get laid.

Can you imagine untrained, uncoordinated, inexperienced amateurs dealing effectively with any part of such a mixture?

I can’t.

When I assign that task to my imagination, it just laughs.

Hysterically.

Let’s eliminate police misconduct, not the police.

Capitalism (1st)

Can We Do It Better?

Free-market capitalism operates differently from the way it is described by economists / politicians.

Given the significance of capitalism in our lives, “We the people” might profit from discussion of this difference, which I propose to offer in sequentially numbered installments.

Your comments, of course, are welcome.

Free-Market Capitalism—a phrase with strong popular appeal, is to my mind a description of a wish-dream.

It doesn’t exist.

Our belief that it exists interferes with our ability to do capitalism better.

Consider—in a truly unregulated market…

There would be no zoning laws.  There would be no licensing requirements for doctors, nurses, lawyers, electricians, plumbers, veterinarians, cosmetologists, bar tenders, waiters/waitresses, insurance salespersons, psychologists, real estate agents, and others.

There would be no building codes.

There would be no schedule of  controlled substances.

Selling and buying slaves would be legal.

Anyone could sell or buy any type of firearm.  Hygienic laws for food factories and restaurants wouldn’t exist.

There would be no maximum permissible interest rate.  Corporation officers would not be legally required to function in the financial interests of stockholders.

Regulation is assumed to be a negative influence on the (assumed-to-be-flawless) operation of the unregulated market.  People must be totally “free too choose” if, when, what, where, and how to sell or buy.  The free-market form of capitalism seems based on an assumption that no corrective whatsoever will ever be necessary to check the negative manifestations of human nature. ¹

Lets play “What if…”

“What if…” the government decided to get real on the subject of—lets call it the “Sexual Services Industry”, SSI for short, concluding that the world’s oldest profession, being ever with us, practical regard for public health and safety required the following:

Within a given municipality, all SSI workers would operate within a single precisely defined red-light district, the sole legally permissible area of operation, with substantial penalties for setting up shop off the reservation.  All would be required to purchase a license to practice, which could be suspended or revoked for cause, such as flunking periodic mandatory testing for sexually transmitted diseases, (STD’s).  In addition, all SSI workers would pay income tax, the proceeds of which, together with licensing fees, would help to finance the licensing, medical testing, treatment, and policing of SSI workers and their clientele.

What benefits might accrue to society through the above-described regulation of this hypothetical industry and its market?  For openers, no poxy doxy could operate until he/she tested clean. Granted that mandatory periodic testing is not a perfect system, it would unarguably guarantee some reduction in STD infections.

Confining all SSI workers to a single red-light district would make it easier for morally conservative folks, parents and their kids, school busloads of students on field trips, etc. to avoid contact.

SSI workers, operating legally, openly, in the red light district, therefore not fearing the cops, might be more likely to report people who commit crimes against them.  Criminals, realizing that SSI workers were no longer soft targets, might tend to lay off.  So, all other things being equal, the SSI workers could enjoy safer lives, and the city might enjoy some reduction in the crime rate.

In the above “what-if” discussion I have illustrated ways in which government regulation can serve useful purposes.  Before that, I noted types of regulation, which together with the inherent benefits, would be lacking in a truly unregulated, free-market practice of capitalism.

There is actually no market which is not regulated in some way.  We’ve lived with the regulations and the free-market hype for so long that we’ve become blind to both.

Capitalism is no myth.  Free-market?  That’s a myth.


¹ Some professional economists need to revisit rock-bottom basics—if it were really true under any circumstances that all checks on the negative side of human nature were unnecessary, then God needn’t have given Moses the ten commandments.

Once again—unnecessary?  Ask any lawyer, cop, detective, psychiatrist, priest, minister, rabbi, mullah, youth counselor, or parent for that matter.

Do you prefer a shortcut?  Ask crime victims.