"He's a snake in the grass, I tell ya guys; he may look dumb but that's just a disguise; he's a mastermind in the ways of espionage." Charlie Daniels, "Uneasy Rider" "Clean coal" leaves a big mess; which faceless employee, manager or shareholder committed this tort? - TT's Lost in Tokyo

"Clean coal" leaves a big mess; which faceless employee, manager or shareholder committed this tort?

Yes, I'm referring to the bursting of the TVA holding dam in Kingston, TN a few days ago, leaving a Christmas Eve present of millions of cubic feet of wet fly ash several feet deep over hundreds of acres downstream, including now valueless private homes and property, and flowing into the Clinch River and Tennessee, where fish kills have been reported.  A video from a helicopter fly-over here; local coverage is here

Enviros and the press were fairly quick to point out that the federal government has declined, under industry pressure, to more strictly regulate the disposal of fly ash (replete with heavy metals and arsenic, and which has been captured in increasing amounts as clean air regulation requires greater "scrubbing" from power plant emissions) - but I'd like to make the point that this is the kind of faceless tort that we get from limited liability corporations, including federally-owned ones like the TVA , where shareholders have little interest and zero practical ability to monitor the risks created by the corporation. 

Further, this type of rent-seeking and money-influenced political balancing is par for the course, and is a natural outcome of the replacement of the pro-industry, "pollute for free" era with the "government regulates industry" era that Walter Block speaks of.

Limited liability:  a gift of the state that keeps on giving!

 

Published Fri, Dec 26 2008 11:04 AM by TokyoTom

Comments

# re: "Clean coal" leaves a big mess; which faceless employee, manager or shareholder committed this tort?

Friday, December 26, 2008 12:24 PM by scineram

They hold shares, not run it. If I wanted interest I would be a manager.

# re: "Clean coal" leaves a big mess; which faceless employee, manager or shareholder committed this tort?

Friday, December 26, 2008 4:16 PM by wombatron

Good point about corporations.  Watch out, though; Stephan Kinsella might pop up here and comment! :-)

# re: "Clean coal" leaves a big mess; which faceless employee, manager or shareholder committed this tort?

Sunday, December 28, 2008 9:43 AM by TokyoTom

scinerams, who committed this tort?  How many heads will roll?  What individuals stand for TVA?

I`m not saying that shareholders (here, the American people generally) run the TVA; my principal point is that limited liability of shareholders enables and encourages torts like this.  Without a state grant of limited liability in the case of usual corporations, large shareholders would take greater interest in how well the firm manages risk, and smaller shareholders might purchase insurance to make sure they have no large contingent exposure.  The result would be better thought-out operations, based on pressure from shareholders and insurers.

What`s different in this case is that TVA is a government-owned corporation, so not only does it generate risks for others to bear, but the taxpayer is stuck holding the bag for clean up operations and liability costs.

Who runs the TVA?  Bureaucrats.

Individuals have to take full responsibility for their actions, and others in their community can hold them responsible.  Not so for corporations generally, particularly not government ones.

# Note to William Anderson: Limited liability is a key to understanding the Great American Ponzi scheme

Sunday, January 4, 2009 11:38 PM by TT`s Lost in Tokyo

William Anderson has a thoughtful New Year's Day post , pointing out how Paul Krugman fails to understand

# Rot at the core: federally owned TVA's massive coal flyash spill - as the EPA plans new regulations, TVA "protects" affected residents by hassling/arresting the volunteers who help them

Wednesday, March 11, 2009 4:22 AM by TT`s Lost in Tokyo

A few items of interest have come to my attention regarding the TVA's massive spill last December