Home > Uncategorized > Sorry, but I can't resist asking: Feel Sorry for Tokyo Electric Power Co?

Sorry, but I can't resist asking: Feel Sorry for Tokyo Electric Power Co?

(Note; tongue firmly in cheek: see my straight post earlier.)

Well, maybe they weren’t WISE to build a row of nuclear power plants on a coastline known for earthquakes and a history of prior massive tsunamis, but surely the earthquake and tsunami are not TEPCO’s fault, right?

And it’s not THEIR fault that

  • their founding shareholders took advantage of Japanese limited liability incorporation laws that free shareholders from any concern about personal liability (and, as TEPCO’s shares are “fully paid-up”, from any future cash calls by management) that would otherwise exist for private enterprises;
  • the Japanese government allowed them to qualify as a ‘public company’ and thus widely raise capital from the public, under regulations that isolate managers from shareholders and create barriers to entry);
  • the Japanese government licensed TEPCO as a public utility, effectively granting it a monopoly in the greater Tokyo area,
  • the Japanese government ensured that TEPCO could raise the long-term capital necessary to fund the nuclear power plants,
    • by authorizing to set rates guaranteeing TEPCO’s returns on its investments by government,
    • by licensing the power plants themselves and approving their location, suppliers and safety, and
    • by giving TEPCO express liability caps for damages that radiation releases may cause others if an “act of nature” occurs?

And surely none of the concatenation of these acts of government, the construction of the plants and the earthquake or tsunami is the PERSONAL responsibility of any of TEPCO’s emploees, managers or executives, right? (Much less of the poor shareholders!) After all, having a corporation means that we get to embark on mega-projects that pose mega-risks, all without any real people being  personally responsible! How else, without these layers of protection for personal responsibility provided by government, would progress ever be made?

Thus, we can see clearly that this was all nothing more than a simple ACCIDENT, in which “TEPCO” – whoever the heck we consider that to mean – is the BIGGEST VICTIM – both of the earthquake/tsunamis and of Japanese silly government and citizens and customers who now clamor for TEPCO to pour more BILLIONS down a money hole! Outrageous – all of these snivelling people should just go away, and lump it, so that TEPCO can more easily figure out what it should do next. Cleanups are for governments and the smaller victims.

Such a wonderful system, allowing such marvelous works! Though unfortunate calculations might be made, the system allows us to quickly move ahead, as if nothing had happened. Naturally, TEPCO might require further assistance from government and government-protected banks, so that TEPCO can build more engineering marvels.

Boy, aren’t Austrian insights wonderful?

[Those of you who missed or who wish to refresh your recollection regarding my posts last year on a very related case, might enjoy the following link:

http://mises.org/Community/blogs/tokyotom/search.aspx?q=victim+bp.]

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  1. TokyoTom
    March 29th, 2011 at 08:01 | #1

    “it is the state’s fault.”
    Unenlightening. PEOPLE act and choose to act, not “the state” and not legal fictions like “corporations”. While the state holds guns to peoples heads, in the case of corporations it merely skews incentives, which is PRECISELY my point.

    “No libertarain argues this”
    “Austrians do not argue this.”

    Stephan, I’m not quite sure how you missed my sarcasm. Certainly the positions I criticize are NOT based on Autsrian principles, but then again there is the little problem of human inconsistency, embodied by your good self and by Lew, who have skated very close to what I have exaggerated for the very purpose of having you recognize your own sympathy for the Devil.

    BTW, I’m a card-carrying member! Really.

    And while I really, realy DO appreciate your engagement and invitation to join you, I hope you will also consider my invitation for you to join me in figuring out ways to deal with the host of problems that spring from state-corporatism (not simply the corporate abuse of IP).

    Best,

    Tom

  2. nskinsella
    March 27th, 2011 at 21:21 | #2

    “their founding shareholders took advantage of Japanese limited liaiblity incorporation laws that free shareholders from any concern about personal liaiblity (and, as TEPCO’s shares are “fully paid-up”, from any future cash calls by management) that would otherwise exist for private enterprises;”

    The problem, as ever, is the state; if I recall you do not oppose the state. If you are right about these limited liability laws’ effects (there is no proof you are), it is the state’s fault.

    Why do we have these type of reactors instead of say thorium? for nuclear weapons purposes, perhaps?

    “the Japanese government allowed them to qualify as a ‘public company’ and thus widely raise capital from the public, under regulations that isolate managers from shareholders and create barriers to entry);”

    “allowed”? Wow, if you have the right not to allow, you might as well as well set conditions that are “reasonable,” right?

    “the Japanese government licensed TEPCO as a public utility, effectively granting it a monopoly in the greater Tokyo area,”

    More state fault.

    “the Japanese government ensured that TEPCO could raise the long-term capital necessary to fund the nuclear power plants,”

    More restuls of statism. Do you yet oppose the state? If not, this is what you get.

    “by authorizing to set rates guaranteeing TEPCO’s returns on its investments by government,
    by licensing the power plants themselves and approving their location, suppliers and safety, and
    by giving TEPCO express liability caps for damages that radiation releases may cause others if an “act of nature” occurs?”

    Do you oppose the state or support it?

    “And surely none of the concatenation of these acts of government, the construction of the plants and the earthquake or tsunami is the PERSONAL responsibility of any of TEPCO’s emploees, managers or executives, right? ”

    No libertarain argues this; in fact limited liability has do do with shareholders NOT employees, managers, executives (or directors).

    “Boy, aren’t Austrian insights wonderful?”

    Austrians do not argue this. Your understanding of Austrianism seems to be as good as your understanding of the state. IF the state gives us such terrible rules and results, why not oppose the state–as we good Austro-anarchists do? Join us.

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