General

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Autolykos — Fri, 04 Feb 2011 19:02:12 GMT

AJ:
I think that why many libertarians believe "the market will take care of it" is because they have seen how this can and does happen, through theory/reasoning and actual examples in history and in the present. The conjectures about the future are fine as long as they are kept in the context of enlightened conjecture. Whenever they are presented outside that context, the argument immediately takes on needless weakness, rigidity, and divisiveness.

I mean, who's going to get offended or object about crystall ball predictions? If they regarded them simply as predictions they wouldn't react in the way they do, calling themselves left libertarians and such. The argument could then be limited to a rational discussion of likely outcomes in the absence of central authority.

Thanks for writing this. I agree with it and consider myself to engage in the kind of "enlightened conjectures" you refer to. However, I think discussions like these can also be treated juristically, if that makes sense. When treated that way, the idea isn't to make predictions about how things will work in the future. Rather, the idea is to determine which legal frameworks are consistent with libertarian principles.

On a related note, I think one of the biggest "schisms" in the libertarian movement today centers around this question: which came first, the law or the market?

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

AJ — Fri, 04 Feb 2011 11:05:19 GMT

I think that why many libertarians believe "the market will take care of it" is because they have seen how this can and does happen, through theory/reasoning and actual examples in history and in the present. The conjectures about the future are fine as long as they are kept in the context of enlightened conjecture. Whenever they are presented outside that context, the argument immediately takes on needless weakness, rigidity, and divisiveness.

I mean, who's going to get offended or object about crystall ball predictions? If they regarded them simply as predictions they wouldn't react in the way they do, calling themselves left libertarians and such. The argument could then be limited to a rational discussion of likely outcomes in the absence of central authority.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Autolykos — Fri, 28 Jan 2011 14:59:27 GMT

AJ:
I guess people just can't resist speculating. Also, people hate uncertainty, so they want at least some comforting scenario to latch onto. Not only that, the debates that stay current are the ones that go on and on forever. The ones that are over so quickly because the answer is easy, no one sees.

Yes, people do hate uncertainty. Especially statists. That's why they have all those questions that start with "But what about..."

AJ:
Anyway, these crystal-ball scenarios are a weak reed to rely on for trying to win people over to a stateless way of seeing things. More importantly, as you mention, they are inherently divisive. This is one reason libertarianism is so needlessly splintered.

In my experience (which may differ from yours and Charles Anthony's), statists are wholly unconvinced by simply hand-waving and saying that "the market will take care of it somehow". To them, that kind of thing simply shows faith in the market vs. faith in something else. And faith can't be debated.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

AJ — Fri, 28 Jan 2011 08:20:16 GMT

Charles Anthony:
In this particular topic, I say no one should speculate but frankly, I do not care what you want to do. If confused anarchists want to walk around with flower pots on their head and discuss how a libertarian society would welcome their new fashion sense, they can have all the fun they want in their discussion.

What bothers me is that I can understand the esoteric models but the layman reads this crap and laughs at us. In my opinion, the proper way to approach this nonsense is to simply say: "Governments should not be assigning special privileges. I do not care what happens to the corporations nor to their shareholders. They do not deserve MY MONEY to arbitrate their greedy disputes. Let them fight it out on the streets for all I care. Period." That way, the average socialist is on our side, the average neo-confuso-con is put in his place and the core values of anarchism are made clear.

This.

I guess people just can't resist speculating. Also, people hate uncertainty, so they want at least some comforting scenario to latch onto. Not only that, the debates that stay current are the ones that go on and on forever. The ones that are over so quickly because the answer is easy, no one sees.

Anyway, these crystal-ball scenarios are a weak reed to rely on for trying to win people over to a stateless way of seeing things. More importantly, as you mention, they are inherently divisive. This is one reason libertarianism is so needlessly splintered.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Autolykos — Thu, 27 Jan 2011 14:42:31 GMT

liberty student:
Autolykos:
By the same token, if you burn the house down in the process of cooking dinner, does it really matter who buys the groceries?

Irrelevant to the discussion.

How is it irrelevant, exactly? You seemed to imply that, in your dinner example, the person buying the groceries is entirely responsible for the cook's actions in making dinner. Did I misunderstand? If so, please help me to understand -- I'm not a mind-reader.

liberty student:
The shareholders are the owners. I thought you said you understood how corporations are formed.

Who owns the corporation before the IPA? That is to say, who owns the assets?

liberty student:
Autolykos:
I understand that they aren't. But how can a formal legal contract be binding on outside parties?

I never claimed it would be.

It seemed otherwise. It seemed like you were claiming a contractual liability limitation would hold in the case of damage to third parties. That's why I came up with that pollution example. I can't help but notice you didn't address this exmaple at all. Why is that?

Now we get into the blatantly personal stuff. I suppose I could respond over in Member Issues but since you brought it up here, I feel obliged to respond in kind.

liberty student:
I'm starting to lose interest in debating with you again.

Oh dear. Am I supposed to feel bad from this? Or intimidated?

liberty student:
I think we'd get much further along if you spent more time thinking about what I have written, then asking question after question asking me to explain myself for you.

Translation (as I see it): "Shut up and don't challenge what I write."

liberty student:
I don't have any interest in that.

I don't care. I will continue to ask questions as I please. You're still free to evade them, of course.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Charles Anthony — Thu, 27 Jan 2011 13:30:21 GMT

gocrew:
but this cannot cover third parties not a part of the contract.

Says who? How does this arrangement handle vigilanteism from people who take it upon themselves to seek out redress through the barrel of a gun?

What I am getting at here is that insurance companies and companies can organize any convoluted scheme they want to justify why group A in the corporation SHOULD be held liable and group B (say, employees working on the assembly line) SHOULD NOT be held liable. However, that all means nothing if third parties believe that the assembly workers are liable. The attempted libertarian limited liability model in question will have to adapt to the market whether they like it or not.

That adaptation might POSSIBLY involve hiring more security guards to protect laborers at work and while they travel and maybe while they retire in their homes. That will affect the costs of insurance. If those costs are too high, the insurance company may refuse to cover that limited liability and then the model is out the window.

Limited liability models are meaningless if the public ( or anybody for that matter ) challenges them with the threat of violence.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

gocrew — Wed, 26 Jan 2011 22:17:12 GMT

When Rothbard discussed it in The Ethics of Liberty, he noted that by engaging in contract with a LLC, one is implicitly recognizing their limited liability, but this cannot cover third parties not a part of the contract. I think a libertarian order would require limited liability insurance for those situations, if the stockholders desired LL, and then the industry would benefit from the regulation of insurance companies. It would also be a factor that tended to decrease the size of corporations too.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

liberty student — Wed, 26 Jan 2011 22:11:13 GMT

mahall:
Are corporations comparable to representative democracy in their process to select a managerial board?

They can be.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

liberty student — Wed, 26 Jan 2011 22:10:11 GMT

Autolykos:
By the same token, if you burn the house down in the process of cooking dinner, does it really matter who buys the groceries?

Irrelevant to the discussion.

Autolykos:
How can the shareholders have authority above that of the corporation's owners?

The shareholders are the owners. I thought you said you understood how corporations are formed.

Autolykos:
I understand that they aren't. But how can a formal legal contract be binding on outside parties?

I never claimed it would be.

I'm starting to lose interest in debating with you again. I think we'd get much further along if you spent more time thinking about what I have written, then asking question after question asking me to explain myself for you. I don't have any interest in that.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

liberty student — Wed, 26 Jan 2011 22:05:46 GMT

nirgrahamUK:
Either that or I have completely lost the plot. (always a possibility)

Not completely. I think we're talking past each other. You're not addressing my point, and I have no interest in addressing yours.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Charles Anthony — Wed, 26 Jan 2011 21:52:47 GMT

Autolykos:
Charles Anthony:
Nobody can predict the market and nobody knows what people will want once they are faced with paying for it themselves.
You're right, of course. But as I've asked you before, does that mean no one should ever engage in speculation on the differences between a completely free market and what we live under today?

In this particular topic, I say no one should speculate but frankly, I do not care what you want to do. If confused anarchists want to walk around with flower pots on their head and discuss how a libertarian society would welcome their new fashion sense, they can have all the fun they want in their discussion.

What bothers me is that I can understand the esoteric models but the layman reads this crap and laughs at us. In my opinion, the proper way to approach this nonsense is to simply say: "Governments should not be assigning special privileges. I do not care what happens to the corporations nor to their shareholders. They do not deserve MY MONEY to arbitrate their greedy disputes. Let them fight it out on the streets for all I care. Period." That way, the average socialist is on our side, the average neo-confuso-con is put in his place and the core values of anarchism are made clear.

Autolykos:
For example, it seems clear that blanket limitations of liability would not exist in a completely free market. The question is: what are the implications of that? Why not pursue those implications?

Maybe I am a bit of a simpleton but have fun. However, in the spirit of true anarcho-capitalism, the implications do not matter any more than what the new video game will be on the shelves next year.

However, I will play along and speculate:

In my opinion, when faced without a centralized security / legal system, people will arrive at their own agreements and they will make them public if it is in their own interest to do so. Contracts will seek private registrars. Private registrars will offer arbitration services in anticipation that future disputes will invariably arise. The best registrars with the best track record of arbitrating disputes will get the most clients. Everything will be done publicly so that people who try to shirk their contracted responsibilities will be publicly outed, their reputation will be shot and their livelihood will be at stake.
By the way, that simple model covers a large chunk of all anarcho-capitalist speculation.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

mahall — Wed, 26 Jan 2011 21:20:04 GMT

Liberty Student,

It would be helpful if people understood how corporations are formed, under what sort of structures etc.

Are corporations comparable to representative democracy in their process to select a managerial board?

If so, would this comparison make sense; voters have liability, no matter who they voted for, for actions of the president or congress? I don't feel voters are liable for the war in Iraq, as an example.

I think I confused myself thinking about the liability upon shareholders of managerial inaction...

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

nirgrahamUK — Wed, 26 Jan 2011 21:09:07 GMT

Autolykos, I think under Rothbardian Title Transfer theory of contracts, the limitation of liability would not be enforceable , it would be a mere promise, a test of the honesty of the board of directors who's promise to the CEO is put to the test, and whose customers are looking to see the Company make good on the bad PR of having employed a 'bad' CEO. So the board of directors could say, its a mere promise, and let the CEO hold the bag, or they can act to keep their promise and pay the excess above 10,000£ on the CEO's behalf.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Autolykos — Wed, 26 Jan 2011 21:06:29 GMT

nirgrahamUK:
I am not arguing against you... my point is that shareholders hardly require a 'positivistic' legal statute imposing a 'blanket' liability immunity in their capacity as mere shareholders, which does not extend to cover them in their other respects.... it is as redundant as imposing a 'blanket' liability immunity on relatives within families. its just silly. First of all, for epistemological reasons we have assumption of innocence, secondly we have (or could have!) court systems which determine peoples liabilities based on their responsibilities for harms caused, so on.

If you are a mere shareholder, and you have never performed any action in your capacity as a shareholder to connect you with a tort caused by some employee or employees aside from the mere possession of some shares, you are by default not liable, since owning shares does not of itself cause harms or cause others to do harms for you. if a tort has occurred and some shareholder has a degree of responsibility (and this is certainly possible), this is always because the shareholder did something in addition to the mere ownership of shares which colours him responsible to some degree.

Either that or I have completely lost the plot. (always a possibility)

Thanks for this, NirgrahamUK. I don't think you've lost the plot at all. Rather, you've made the same arguments I've been making, just more eloquently.

Re: Libertarian Causation and Responsibility Theories (or another Limited Liability Discussion)

Autolykos — Wed, 26 Jan 2011 21:03:55 GMT

liberty student:
I am cooking dinner. You say, "you probably won't make chicken teriyaki because you're only the cook, not the menu planner" and I reply, "don't forget who buys the groceries around here."

By the same token, if you burn the house down in the process of cooking dinner, does it really matter who buys the groceries?

liberty student:
Everything in a corporation flows from the shareholders on down. They are the absolute authority and have the power to delegate their authority. The directors and officers cannot take that power from them.

How can the shareholders have authority above that of the corporation's owners? The shareholders don't own any of the corporation's assets, they've simply invested in the corporation in exchange for shares, which may or may not give them additional privileges.

liberty student:
Your example had nothing to do with formal legal contracts. Corporations are not based on ad lib relationships.

I understand that they aren't. But how can a formal legal contract be binding on outside parties?

For example, let's say a person is hired as CEO of an industrial corporation, with a contract stipulating that he won't be held liable for more than $10,000 in damages. He then directs lower-level employees to dump industrial waste into a residential water supply. This pollution ends up sickening thousands of people. However, no one above the CEO knew that this was done. Why should the CEO be liable for only $10,000 in the damages he presided over? The people who were sickened weren't privy to the contract.