Fannie Mae: $11 billion off
Hey, what's a few billion more in earnings corrections among friends? Not much if your friends are in Congress, evidently.
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Ah yes, when big gov’t and big business get together, you have to remove your spine to bend over far enough for the reaming you’re going to get. But as joe will tell you, how can you trust big business without the goverment, and the checks our democratic system set on it, keeping an eye on their evil ways?
And no, I’m not saying that I trust big business any more than the government. I actually trust people who hoard power much like I trust a black widow spider to not bite me if I handle it – not at all. So I really get worried when the government has a hand in running some huge mortgage company. Did no one realise how bad of an idea that is? I think that some might toss around the old “f” word (fascism.
But not me. 😛
Where is Joe? Is he on vacation? I haven’t noticed any comments by him for several days. Am I just missing them?
Trusting Big Government to keep Big Business in check is like trusting the Crips to keep the Bloods in check.
You gotta hand it to psuedo-captialists, go big or go home.
I wish they went home.
Lowdog: “I’m not saying that I trust big business any more than the government.”
thoreau: “Trusting Big Government to keep Big Business in check is like trusting the Crips to keep the Bloods in check.”
Fine sentiments, but it seems they miss an important point. If it were not for big government you wouldn’t have to worry about trusting big business. Absent corporate welfare and subsidies, big business cannot take a dollar from you that you don’t wish to part with. That certainly cannot be said of big government. So if I have to take my chances with one or the other, I’ll go for the big business since GM is not going to get a dime from me unless they give me something worth more than a dime in return.
Actually, it doesn’t take big government to make big business dangerous, although it does seem to take big government to really bugger the pooch. No, just the fact that government creates these artificial responsibility-dodges known as “corporations” is enough to cause mischief. How many corporations get fines for crimes you and I might go to jail for?
By creating the liability-shielding monster in the first place, government ensured there would be trouble later.
“By creating the liability-shielding monster in the first place, government ensured there would be trouble later.”
How so? I would have to strongly disagree with that. The liability shielding is for the personal liability of shareholders so that they know they will not lose more than they put into their investment. The corporation itself is still liable for whatever it does. When the officers engage in criminal behavior as in Enron, they can be (and were) prosecuted. As I said, without the government to do if for them, how can any big corporation take anything from you without your consent?
And to the contrary, the ability to take reasonable economic risks without each shareholder being on the line for the entire liability is a source of much economic gain and without that we would be much worse off today. Almost everything we use in our daily lives that make our standard of living so much higher than just one hundred years ago is available in quantities that make it affordable to the masses primarily because of large corporations. And without the ability of a shareholder who buys a share of Microsoft or GE or GM to know that they will not be on the hook for millions of dollars if things go bad, there would not be the necessary capital to risk on developing all those products we take for granted. Therefore, I do not fear large corporations absent their ability to harness the police power of government to their ends.
What Brian said.
Absent artificial support from Big Government, and operating in a legal environment that constrains force and fraud, “Big Business” is nothing more or less than “successful business.”
“Enron-style accounting” = “Fannie Mae-style accounting”
There was a good article about Fannie Mae on Slate last year. An excerpt:
Where is Joe? Is he on vacation? I haven’t noticed any comments by him for several days. Am I just missing them?
Since we’re noticing missing regulars, what ever happened to Thomas Paine’s Goiter?
It’s not so much the shareholders who get to avoid responsibility, but the actual employees and officers of the corporation that get avoid responsibility.
Remember the phrase “guns don’t kill people, people kill people”? It correctly assigns responsibility to the actor, not his tool. Same goes for the corporation. “Corporations don’t discharge toxic waste, people discharge toxic waste.” “Corporations don’t manufacture dangerous products, people manufacture dangerous products.” I could go on, but the principle should be clear.
Yes, the limited liability corporation has been a successful tool for generating wealth. But like all tools, it can be abused, and it has. Unlike most tools, such as a hammer or a dump truck, the limited liability corporation is a figment of government action. Since when do we libertarians trust government to get something right? Do we truly believe that the current laws governing corporate organization are the acme of what is desirable?
The corporation as currently configured shields irresponsible actors from their actions. That needs to change, at minimum.
It doesn’t shield irresponsible actors from their actions – as I pointed out officers are liable for criminal activity of the corporation and corporations are sued and held responsible for dangerous products all the time (even to the point that they get held responsible for things everyone KNEW was dangerous and many that were just used by improperly but that’s another issue). So while I’m not arguing that things are perfect by any means I do disagree with your critique of corporations as being shielded from liability. The only legally recognized shield is for shareholders financial liability. To the extent your claims of employee lack of responsibility apply to corporations, they also apply partnerships, so I don’t see the point of singling out corporations. The cure is to hold people accountable if they behave in a criminal manner regardless of the form of business ownership.