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Fighting over the wheel of government

[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.

  1. hank
    January 21st, 2009 at 20:48 | #1

    > Corporations … you can’t blame things for

    > being what they are.  It’s when they have a

    > tool that allows them to silently hurt people

    > that they become dangerous.  

    I don’t blame corporations for being what they are — the creation of a misread footnote in a court case subsequently turned into immortal limited liability “people” larger than life.

    But — as they are a creation of government — the suggestion that their behavior will be improved by removing their creator is a clear case of mistaking Dr. Frankenstein for his Monster.  It’s the monster that’s the problem.

    Dr. F. just needs serious reeducation.

    We made them, we need to restrain our creation.

  2. TokyoTom
    October 20th, 2007 at 15:15 | #2

    Contumacy, those who get the greatest gains from government are not particularly interested in loosening their grip.

    Yes, corporations are “voluntary” asociations but think back a bit. Aren`t they creatures of the state? Are their state-given advantages to corporations that partnerships and other busiesses created under common law don`t have? Have those advantages grown? And – apart from competition from upstarts – don`t they have more powerful levers over government than individuals?

  3. October 19th, 2007 at 12:50 | #3

    I don’t really understand what you mean by your last paragraph. Corporations are groups of willing participants. I don’t see what is inherently bad about that. When they lobby government to give them special privilages, they are no worse than the poor family begging the government for welfare. Corporations just illuminate the corruption of our system better than anything else. In the end, being an 800 lb gorilla isn’t a bad thing in itself; you can’t blame things for being what they are. It’s when they have a tool that allows them to silently hurt people that they become dangerous.

    That tool is a corrupt, powerful government. Take away that tool, take away the threat.

  4. TokyoTom
    October 18th, 2007 at 03:30 | #4

    MCLA, 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 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.

  5. MCLA
    October 17th, 2007 at 15:00 | #5

    No, citizens are not wrong to seek to counterbalance corporations, but the govt is a poor counterbalance to corporations.

    Lets not forget that the 800 lb. gorilla in the room grew to be that big mainly because of the welfare it keeps getting from the Govt. It is the nature of corporations (and individuals) to be rent seeking. But rent seeking is useful only when the govt is powerful enough do any favours. If you weaken the govt, or better still eliminate it, you make rent-seeking unprofitable. That IMHO is a better counter-balance.

    Cheers!
    MCLA

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