As I see, corporations is not a topic that’s frequently discussed in this forums. Do you think that they are compatible with libertarian principles? I don’t see the problem, as they can be perfectly constructed from private property contracts. What I don’t like is, obviously, the state-backed corporation that now exists. Any thoughts about this?
It seems to me that many defenses of limited liability revolve around the idea that this situation could be created through individual agreements. The problem is, I don’t think that’s true, unless the corporation is going to, before it begins operations, make such agreements with everyone on earth. An agreement with the customers of the firm does not explain why it is that third parties impacted by firm operations cannot seek remedy from the firm’s owners.
I think in the current environment limited liability is a necessity, given all the ridiculous legislation that has been passed. However, in a free market, there would not be any labor laws or anti-trust laws. So there probably would not be nearly as much need to protect investors, as there is now.
I agree with you that there is no way for a business owner to contract with investors limited liability, because that is not something that has to do with the investor and business owner. That has to do with the person bringing the lawsuit to court and the investors.
ivan, mutualists are anti-capitalists, they are not remotely close to austro-libertarians in many cases rejecting both the division of labour and the STV. The one area of supposed commonality is the non-aggression ethic, and thus a voluntary exchange market. But even that isn’t very clear based on their other positions.
So there are at least a couple people on that list who shouldn’t be put forth as libertarian critics of corportations IMO.
They are partial owners of Goldman Sachs. That is what a stock is, an agreement between the current business owners of a company and an investor: to give partial ownership of the company to the investor in return for money.
A retirement fund legally represents the old retired couple. In other words, whatever the retirement fund buys with the old couple’s money is just like the old couple buying it themselves.
If instead of being partial owners, the couple just wanted to be creditors, they could do that as well. However, as a creditor, they would be unable to make any business decisions.
As far as I know, both Gabb and Long are still libertarians (in the capitalist sense). Maybe Long has rather unusual approaches (which I don’t really like) but he’s still a libertarian I think.
If you own a stock, you receive periodic ballots asking you to vote on suggestions of the board of directors. You can either vote or delegate your vote to a selected person.
The difference between a creditor and an equity holder, besides this voting, is that the equity holder has a share in the profits and a creditor does not. If you choose to buy an equity, and therefore benefit from a share of the profits, it makes sense to me that you should be liable for assaults on others as well. The idea that equity is not ownership has a problem - everyone has to acknowledge that holding lots of equity is owning. No one doubts, for instance, that a 51% shareholder is an owner - he can fire the board and run the company directly if he chooses to. Yet the argument is that small equity is not ownership at all. So, on this argument, accumulating lots of non-ownership somehow magically turns into ownership at a certain point. If you want to say that line is 50%, ok, but then there’s a good number of companies with no owners, since they have no majority shareholders. At the same time, the idea that a 40% shareholder has no more power than a .005% shareholder is just silly, so it seems it would have to be more of a continuum than an on/off thing. I have no idea how that continuum is supposed to work, though.
Is this whole idea that shareholders are liable for torts caused by unforeseeable events from their own p.o.v. axiomatic? Or is there a justification for it starting from first principles? In other words, can you prove it?