Re: Corporations

[andie nachgeborenen <andie_nachgeborenen@xxxxxxxxx>]

This discussion is getting a bit off the rails.
Corporations are not "legal fictions" -- they are
legally created entities, no more or less real than
contracts.  It is a strange species of "methodological
individualism" to deny that they "really" exist merely
because they are constituted out of indiviuals and
their relations. What in the social world isn't? They
are as real as nations and classes and races and
governments and courts, etc.

But at the same time they are not evil per se. It is
secondary to describe them as an arrangement that
minimizes transaction costs. They do that, but that
does not disctinguish them from partnerships or
companies or any sort of enterprise that arranges its
activities outside the market world of contarcts.
(Which is part of the reason, actually, why it is an
error to reduce corporations to sets of contracts!)

Primarily corporations are an arrangement for limiting
liability, so that the creditors can't reach the
shareholders' assets beyond their investment in the
corporation. That is an OK purpose, granting the
Okayness of a market economy and a legal sytem that
creates creates like "creditors." Some here will deny
that that is OK, of course, but I don't.

What Gene and others object to is two things, I think:
not the legal device for limiting liability, but the
fact that some corporations have vast wealth and power
that distorts democracy and gives too much influence
to a small number of people, and a legal system that
treats these entities as if they were individual
persons due the legal rights (like free speech) that
are properaly accorded to individuals.  In most
societies, even market societies, the latter is not
true -- corporations are not "persons," as far as I
knwo, under British law (any Brits out there who can
correct me?), and anyway the Brits don't have a First
Amendment.

Moreover one could imagibe a market society where, for
eaxmple, the corporations did not have undemocratic
power and wealth, and where the workers managed them
themselves. Such corporations would be far less
problematic than the largest ones we have -- including
some of my clients.

jks

--- "David B. Shemano" <dshemano@xxxxxxxxxx> wrote:
> Eugene Coyle writes:
>
> <<This interlocking series of contracts has the
> right of free speech?
> <<I think the series of responses Shemano gives in
> this thread is sillier than neo-classical micro.  He
> describes a total <<phantasy world, just as the
> micro theorists do.  But the world both try to hide
> is terribly real.
>  <<This stuff is much worse than people have been
> asked to leave the list over.  Disgusting stuff.
> I'd say beneath <<contempt, but I don't know what is
> lower.
>
> I have never seen a corporation speak.  I have seen
> real people speak on behalf of corporations.  Why do
> you believe that those people do not have a right to
> speak?
>
> What is that word Marxists like to use to describe
> unreal objects that people think are real?  Fetish?
> You see a bogeyman called a "corporation."  You are
> fetishing the corporation.  I see tens, hundreds,
> thousands of contracts between real people intended
> to actualize a real end.  The entity is an
> acknowledged legal fiction that minimizes
> transaction costs.  That is all.  "Exxon" is simply
> a shorthand way to describe thousands of real people
> acting in a united way, and the corporate form
> provides an expedient way of organizing those real
> people.
>
> What disgusts you?  What is beneath contempt?  What
> is the fantasy?
>
> David Shemano


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