Citibank just emailed me to let me know that I have some rewards points expiring at the end of the year. Since I am mandated to use them or lose them, I dutifully logged onto the Citibank "Thank You" website to see what my ~6000 points could buy me.
The website is a disaster. Every page has failed to load at least once if not multiple times that I've clicked on it, making it virtually impossible to browse for items (let alone filter my searches). Once it spontaneously logged me out of my account, causing me to have to start everything over. I finally found a product that I wanted (a cast iron skillet), but I had to enter a new shipping address, and I can't do that because each time I click "submit" the page times out and I have to reinput the information.
In conclusion, clearly Citibank is a failure and must be repealed, and the entire project of private capitalist enterprise has been discredited.
Showing posts with label capitalism. Show all posts
Showing posts with label capitalism. Show all posts
Friday, October 25, 2013
Sunday, September 09, 2012
Building the Shining City
Honduras appears set to create a series of privately-run cities, complete with their own police, laws, government, tax systems, and immigration policy. They'll even be empowered to sign their own international economic agreements. Todd Zywicki is elated. I'm terrified.
It's not entirely clear who will be establishing and overseeing these new governmental institution but, if as appears likely, they are either formally or de facto under the control of the cities' investors, the possibility of abuse appears rampant. The body of government not only will be entirely unaccountable to the majority of its constituents (the persons working in the cities), but may have a duty of loyalty to the outside investors. Meanwhile, if anyone is expecting the project to refrain from abusing the little guy, it's off to a rough start -- local indigenous tribes are already alleging that the project is taking their land without their consent.
It's not entirely clear who will be establishing and overseeing these new governmental institution but, if as appears likely, they are either formally or de facto under the control of the cities' investors, the possibility of abuse appears rampant. The body of government not only will be entirely unaccountable to the majority of its constituents (the persons working in the cities), but may have a duty of loyalty to the outside investors. Meanwhile, if anyone is expecting the project to refrain from abusing the little guy, it's off to a rough start -- local indigenous tribes are already alleging that the project is taking their land without their consent.
Saturday, April 14, 2012
Strict Scrutiny for All!
George Washington law professor Orin Kerr flags a concurring opinion by two arch-conservative judges on the DC circuit (Brown and Sentelle) urging the Supreme Court to return to a Lochner-style strict-scrutiny review of economic laws. The case is Hettinga v. United States:
I think -- though I'm not sure -- that they're using "cowboy capitalism" as a compliment.
Now, it should come as no surprise that I disagree with this position thoroughly. Lochner remains wrong for the same reasons Justice Holmes told us Lochner was wrong. And the story Judge Brown tells about the "political process", though not wrong on face, is both inconsistent and can't support the jurisprudential shift she's advocating.
Judge Brown's critique is basically the indictment of Carolene Products that has been in the mix since at least Bruce Ackerman's Beyond Carolene Products article in the 1980s. The idea is that small, discrete, insular groups are at an advantage in the political process because they are easier to mobilize and can overcome collective action problems. So, for example, even though there are far more milk consumers than milk producers in America, milk producers are at an advantage because they are easier to organize and have a far greater relative stake in milk laws than the diffuse and diverse community of milk "consumers". In this way, law can be and often is subject to capture by these "special interests".
There are at least two responses to this. The first is that, though this does challenge Madison's vision of factions checking factions in Federalist #10, it does not defeat it entirely. Madison may have been wrong that the majority faction always wins. But widespread fracturing may still serve a useful purpose, because it can pit small, discrete factions against each other, thus dissipating their influence. The debate over SOPA, for example, pitted not a "special interest" versus "the people". Rather, there were small factions on both sides -- content providers like the RIAA going against content distributors like Google. In that circumstance, worries about pure capture seem overblown.
But second, even if Judge Brown may well be right that most economic legislation is a series of interest group power plays, her critique tackles our democratic system in general. There's nothing really unique about economic legislation with respect to her concerns. Political ignorance is not just restricted to economic redistribution; it applies across the board. Democracy always is in a weak position to "right itself" with respect to a (potentially mythical) "common good". We are stuck in a system of pluralistic interest-group bargaining, whether we like it or not.
Hence, Judge Brown argument doesn't support strict scrutiny for economic regulation -- it supports strict scrutiny for every law Congress passes. Which may cause my libertarian friends to swoon, but which seems largely incompatible with the supposedly limited role for the judiciary as subservient to the will of the people (imperfect as it may be). And it's notable that even that stance doesn't actually fix the "problem" Judge Brown purports to be tackling, because Congress' decisions not to regulate this or that area is subject to the same interest-group pressures as their decision to regulate (as usual, activity and inactivity is not really any distinction at all). At any rate, there is no evidence that Judge Brown intends to take such a bold position -- strict scrutiny for laws prohibiting gay marriage (and laws which support it), strict scrutiny for affirmative action and for banning it, strict scrutiny for anything and everything.
What's needed is a theory for when heightened judicial solicitude is appropriate. Carolene Products attempts to provide one, but its vulnerabilities are well-taken. But that's why most modern reconstructions of Carolene focus not on "discrete" or "insular" or "minorities", but on "prejudice". This was the one element of Carolene that Ackerman did not have a solid objection to, and it's particularly important in the pluralist interest-group bargaining model because it shows why certain groups or interests may be unable to even "play the game". In essence, public choice theory tells us that being Black in America should have historically been awesome -- they're a discrete, insular minority, they should have been cleaning up in the democratic process. Why didn't they? Because prejudice against them prevented them from even participating equally in the interest-group game. They were pariahs -- it was politically helpful to hurt them and politically deadly to help them.
No true parallel exists for economic regulation. Business interests have shown no incapacity to participate in the democratic process in pursuit of their interests. Obviously no particular business wins all the time, but neither do there seem to be systematic losers placed in the subordinate position because they're simply disliked.
Judge Brown doesn't promote any such theory. What she does have is an aria in praise of free market capitalism. But regrettably, the Constitution still doesn't enact Mr. Herbert Spencer's Social Statics. There is nothing in the Constitution that even presumes free market capitalism leads to the common good. Nor, for that matter, is there anything in the Constitution that presumes that the choices a free democratic society makes will be in pursuit of the common good, though the hope that it does I think is implicit in it.
Indeed, "common good" may be chimerical altogether. All Judge Brown is doing is redistributing the results of the interest-group game away from some and in favor of others more to her political tastes. But neither the Constitution, nor democratic theory, makes any provision for this. It's pure policy, nothing more.
(I have a second post going up dealing with a different part of Kerr's post -- where he questions the propriety of Judge Brown even writing an opinion like this -- which you can find here. While I disagree with the content of Judge Brown's concurrence, opinions of this type I think are quite valuable, for reasons I explain in-post.).
UPDATE: I respond to Professor Barnett's reply in a new post here.
America’s cowboy capitalism was long ago disarmed by a democratic process increasingly dominated by powerful groups with economic interests antithetical to competitors and consumers. And the courts, from which the victims of burdensome regulation sought protection, have been negotiating the terms of surrender since the 1930s.
First the Supreme Court allowed state and local jurisdictions to regulate property, pursuant to their police powers, in the public interest, and to “adopt whatever economic policy may reasonably be deemed to promote public welfare.” Nebbia v. New York, 291 U.S. 502, 516 (1934). Then the Court relegated economic liberty to a lower echelon of constitutional protection than personal or political liberty, according restrictions on property rights only minimal review. United States v. Carolene Products Co., 304 U.S. 144, 152–53 (1938). Finally, the Court abdicated its constitutional duty to protect economic rights completely, acknowledging that the only recourse for aggrieved property owners lies in the “democratic process.” Vance v. Bradley, 440 U.S. 93, 97 (1979). “The Constitution,” the Court said, “presumes that, absent some reason to infer antipathy, even mprovident decisions will eventually be rectified by the democratic process and that judicial intervention is generally unwarranted no matter how unwisely we may think a political branch has acted.” Id.
As the dissent predicted in Nebbia, the judiciary’s refusal to consider the wisdom of legislative acts—at least to inquire whether its purpose and the means proposed are “within legislative power”—would lead to only one result: “[R]ights guaranteed by the Constitution [would] exist only so long as supposed public interest does not require their extinction.” 291 U.S. at 523. In short order that baleful prophecy received the court’s imprimatur. In Carolene Products (yet another case involving protectionist legislation), the court ratified minimalist review of economic regulations, holding that a rational basis for economic legislation would be presumed and more searching inquiry would be reserved for intrusions on political rights. 304 U.S. at 153 n.4. . . .
The practical effect of rational basis review of economic regulation is the absence of any check on the group interests that all too often control the democratic process. It allows the legislature free rein to subjugate the common good and individual liberty to the electoral calculus of politicians, the whim of majorities, or the self-interest of factions. See Randy E. Barnett, Restoring the Lost Constitution: The Presumption of Liberty 260 (2004).
The hope of correction at the ballot box is purely illusory. See generally Ilya Somin, Political Ignorance and the Counter-Majoritarian Difficulty: A New Perspective on the Central Obsession of Constitutional Theory, 89 Iowa L. Rev. 1287 (2004). In an earlier century, H. L. Mencken offered a blunt assessment of that option: “[G]overnment is a broker in pillage, and every election is a sort of advance auction sale of stolen goods.” On Politics: A Carnival of Buncombe 331 (1996). And, as the Hettingas can attest, it’s no good hoping the process will heal itself. Civil society, “once it grows addicted to redistribution, changes its character and comes to require the state to ‘feed its habit.’” Anthony De Jasay, The State 226 (1998). The difficulty of assessing net benefits and burdens makes the idea of public choice oxymoronic. See id. at 248. Rational basis review means property is at the mercy of the pillagers. The constitutional guarantee of liberty deserves more respect—a lot more.
I think -- though I'm not sure -- that they're using "cowboy capitalism" as a compliment.
Now, it should come as no surprise that I disagree with this position thoroughly. Lochner remains wrong for the same reasons Justice Holmes told us Lochner was wrong. And the story Judge Brown tells about the "political process", though not wrong on face, is both inconsistent and can't support the jurisprudential shift she's advocating.
Judge Brown's critique is basically the indictment of Carolene Products that has been in the mix since at least Bruce Ackerman's Beyond Carolene Products article in the 1980s. The idea is that small, discrete, insular groups are at an advantage in the political process because they are easier to mobilize and can overcome collective action problems. So, for example, even though there are far more milk consumers than milk producers in America, milk producers are at an advantage because they are easier to organize and have a far greater relative stake in milk laws than the diffuse and diverse community of milk "consumers". In this way, law can be and often is subject to capture by these "special interests".
There are at least two responses to this. The first is that, though this does challenge Madison's vision of factions checking factions in Federalist #10, it does not defeat it entirely. Madison may have been wrong that the majority faction always wins. But widespread fracturing may still serve a useful purpose, because it can pit small, discrete factions against each other, thus dissipating their influence. The debate over SOPA, for example, pitted not a "special interest" versus "the people". Rather, there were small factions on both sides -- content providers like the RIAA going against content distributors like Google. In that circumstance, worries about pure capture seem overblown.
But second, even if Judge Brown may well be right that most economic legislation is a series of interest group power plays, her critique tackles our democratic system in general. There's nothing really unique about economic legislation with respect to her concerns. Political ignorance is not just restricted to economic redistribution; it applies across the board. Democracy always is in a weak position to "right itself" with respect to a (potentially mythical) "common good". We are stuck in a system of pluralistic interest-group bargaining, whether we like it or not.
Hence, Judge Brown argument doesn't support strict scrutiny for economic regulation -- it supports strict scrutiny for every law Congress passes. Which may cause my libertarian friends to swoon, but which seems largely incompatible with the supposedly limited role for the judiciary as subservient to the will of the people (imperfect as it may be). And it's notable that even that stance doesn't actually fix the "problem" Judge Brown purports to be tackling, because Congress' decisions not to regulate this or that area is subject to the same interest-group pressures as their decision to regulate (as usual, activity and inactivity is not really any distinction at all). At any rate, there is no evidence that Judge Brown intends to take such a bold position -- strict scrutiny for laws prohibiting gay marriage (and laws which support it), strict scrutiny for affirmative action and for banning it, strict scrutiny for anything and everything.
What's needed is a theory for when heightened judicial solicitude is appropriate. Carolene Products attempts to provide one, but its vulnerabilities are well-taken. But that's why most modern reconstructions of Carolene focus not on "discrete" or "insular" or "minorities", but on "prejudice". This was the one element of Carolene that Ackerman did not have a solid objection to, and it's particularly important in the pluralist interest-group bargaining model because it shows why certain groups or interests may be unable to even "play the game". In essence, public choice theory tells us that being Black in America should have historically been awesome -- they're a discrete, insular minority, they should have been cleaning up in the democratic process. Why didn't they? Because prejudice against them prevented them from even participating equally in the interest-group game. They were pariahs -- it was politically helpful to hurt them and politically deadly to help them.
No true parallel exists for economic regulation. Business interests have shown no incapacity to participate in the democratic process in pursuit of their interests. Obviously no particular business wins all the time, but neither do there seem to be systematic losers placed in the subordinate position because they're simply disliked.
Judge Brown doesn't promote any such theory. What she does have is an aria in praise of free market capitalism. But regrettably, the Constitution still doesn't enact Mr. Herbert Spencer's Social Statics. There is nothing in the Constitution that even presumes free market capitalism leads to the common good. Nor, for that matter, is there anything in the Constitution that presumes that the choices a free democratic society makes will be in pursuit of the common good, though the hope that it does I think is implicit in it.
Indeed, "common good" may be chimerical altogether. All Judge Brown is doing is redistributing the results of the interest-group game away from some and in favor of others more to her political tastes. But neither the Constitution, nor democratic theory, makes any provision for this. It's pure policy, nothing more.
(I have a second post going up dealing with a different part of Kerr's post -- where he questions the propriety of Judge Brown even writing an opinion like this -- which you can find here. While I disagree with the content of Judge Brown's concurrence, opinions of this type I think are quite valuable, for reasons I explain in-post.).
UPDATE: I respond to Professor Barnett's reply in a new post here.
Wednesday, February 01, 2012
Call on Me
Sometimes when Jill and I are talking about education policy and politics, she mentions how one of the most problematic mythologies around education is the idea of the super-teacher -- that if teachers just want it enough and are committed enough, that will be the silver bullet that ensures every child gets a solid education. The problem being two-fold -- first, it's unreasonable to expect teachers to be superhuman, and second, that teachers are limited in what they can do absent fundamental, structural reform. Moreover, the super-teacher claim also is often used as a way of concern trolling against improvements in teacher working conditions -- the idea being that because "good" teachers are these altruistic Lifetime TV stars who are in it because they are "called" to the profession, they don't (or shouldn't) care how much money they make, how many hours they have to work, or what condition their classrooms are in.
This last argument was the one put forward by Alabama state Sen. Shadrack McGill (R):
One notes, of course, that this appears to make teaching different from nearly every other profession and, indeed, the basics of capitalist economics. For most professions, we assume that people are not altruists who do what they do "for love of the game". We don't assume they're purely mercenary, but we do think that performance is tied to pay and compensation. And the corollary is that if you want better people, you shell out more dough. If I'm repairing my roof, I can hire a cheap contractor who will likely do a shoddy job, or I can hire a more expensive one who will do the job right. You get what you pay for. This idea that the way to increase performance is to reduce pay so you only get the most "passionate" applicants is not, shall we say, a universally accepted principle, and certainly one Sen. McGill applies in his own life (he just voted to give himself a 67% pay raise. Apparently he's not "called" to legislate?). But teachers, for some reason, are a special case.
This last argument was the one put forward by Alabama state Sen. Shadrack McGill (R):
“If you double a teacher’s pay scale, you’ll attract people who aren’t called to teach.
“To go in and raise someone’s child for eight hours a day, or many people’s children for eight hours a day, requires a calling. It better be a calling in your life. I know I wouldn’t want to do it, OK?
“And these teachers that are called to teach, regardless of the pay scale, they would teach. It’s just in them to do. It’s the ability that God give ‘em. And there are also some teachers, it wouldn’t matter how much you would pay them, they would still perform to the same capacity.
“If you don’t keep that in balance, you’re going to attract people who are not called, who don’t need to be teaching our children. So, everything has a balance.”
One notes, of course, that this appears to make teaching different from nearly every other profession and, indeed, the basics of capitalist economics. For most professions, we assume that people are not altruists who do what they do "for love of the game". We don't assume they're purely mercenary, but we do think that performance is tied to pay and compensation. And the corollary is that if you want better people, you shell out more dough. If I'm repairing my roof, I can hire a cheap contractor who will likely do a shoddy job, or I can hire a more expensive one who will do the job right. You get what you pay for. This idea that the way to increase performance is to reduce pay so you only get the most "passionate" applicants is not, shall we say, a universally accepted principle, and certainly one Sen. McGill applies in his own life (he just voted to give himself a 67% pay raise. Apparently he's not "called" to legislate?). But teachers, for some reason, are a special case.
Tuesday, October 25, 2011
Post-Panel Roundup
The last post was originally meant to just be the intro blurb for a roundup, before it got all long and unwieldy. So I spun it off, and now the roundup gets its own post with its own brief, snazzy intro.
* * *
OneVoice brings in some high profile figures encouraging the development of grassroots momentum for a two-state solution.
Alyssa Rosenberg on the politics of Ellen Raskin novels. The Westing Game is one of my favorite books of all time, and one I can't wait to hand off to my kids.
A new paper shows the existence of racial bias in eBay transactions (specifically, baseball cards shown held by a dark-skinned hand sold for less than those held by a light-skinned hand).
This is probably behind a paywall for most of you, but if you have university access, I found this paper critiquing "moral minimalism" interesting (and I speak as someone who generally identifies as a moral minimalist). The cite is David L. Norton, Moral Minimalism and the Development of Moral Character, 13 Midwest Stud. Phil. 180 (1988).
Mah Rabu says something I've often wanted to stress: Defining Orthodox Judaism as "more religious" and other strands as "less religious" is kind of giving away the game. I'm not a Conservative Jew because I'm too lazy or uncommitted to Judaism to be an Orthodox Jew. I'm a Conservative Jew because I think we do Judaism right. If you're Reform or Reconstructionist, you should have the same confidence in your own beliefs. And while it's fine to experiment and figure out what's best for you, experimentation can and should draw from all sectors of the Jewish community.
Ta-Nehisi Coates hosts David Skeel talking about William Stuntz's views on jury nullification, with reference to Paul Butler. It's a good thing.
* * *
OneVoice brings in some high profile figures encouraging the development of grassroots momentum for a two-state solution.
Alyssa Rosenberg on the politics of Ellen Raskin novels. The Westing Game is one of my favorite books of all time, and one I can't wait to hand off to my kids.
A new paper shows the existence of racial bias in eBay transactions (specifically, baseball cards shown held by a dark-skinned hand sold for less than those held by a light-skinned hand).
This is probably behind a paywall for most of you, but if you have university access, I found this paper critiquing "moral minimalism" interesting (and I speak as someone who generally identifies as a moral minimalist). The cite is David L. Norton, Moral Minimalism and the Development of Moral Character, 13 Midwest Stud. Phil. 180 (1988).
Mah Rabu says something I've often wanted to stress: Defining Orthodox Judaism as "more religious" and other strands as "less religious" is kind of giving away the game. I'm not a Conservative Jew because I'm too lazy or uncommitted to Judaism to be an Orthodox Jew. I'm a Conservative Jew because I think we do Judaism right. If you're Reform or Reconstructionist, you should have the same confidence in your own beliefs. And while it's fine to experiment and figure out what's best for you, experimentation can and should draw from all sectors of the Jewish community.
Ta-Nehisi Coates hosts David Skeel talking about William Stuntz's views on jury nullification, with reference to Paul Butler. It's a good thing.
Monday, February 01, 2010
Recasting Avatar
The VC has already brought attention to one property rights interpretation of a tale generally thought to be left-leaning (The Lorax). Today, Ilya Somin points to another example of the genre: David Boaz on Avatar:
I think that's a perfectly tenable interpretation of the movie. I'd question, though, how strong the dissonance is with the "face" (leftist) message.
It is certainly true that the sort of leftist thought that Boaz is identifying Avatar with hardly identifies as capitalist. But that hardly means they can't speak in term of property rights. Indeed, while the anti-colonialist theory being drawn from here would likely not cast things in terms of individual plot ownership, they certainly are quite willing to assert cultural "ownership" of certain plots of land, territories, or resources. Indeed, the Na'vi seem to view these territories as collectively owned by "the people" (there is no indication that any one person in the community owns the land or the unobtanium). This raises a harder question for capitalist theorists than Boaz cares to admit, as capitalist entities have always had trouble figuring out how to handle (read: have felt comfortable ignoring completely) notions of property ownership that were not sufficiently individualistic. The doctrine of terra nullius was applied to claim that places such as Australia weren't actually "owned" by anyone, since the land wasn't titled in a manner that was comprehensible according to contemporary proto-capitalist norms.
But anyway. I think contemporary leftists are more anti-corporate than they are anti-capitalist. The argument in Avatar is that given sufficient power, corporations would be quite willing to ignore such capitalist niceties as property rights and freedom of contract (at least when it suits them). Put differently, the same priors that suggest a corporation would be indifferent to good liberal values like "don't slaughter the natives" would equally suggest that the corporation would be indifferent to good libertarian values like "contract with the natives". The corporation is going to take the least expensive path, whatever that may be, and unless some entity is their to raise the cost of the "killing the natives and taking their property", there's no reason to believe that market economics of all things will act as a restraining force.
So Avatar is an indictment of anarcho-capitalism, to a point, but the twist is it making the further claim that the necessary condition for an anarcho-capitalist hell is not absence of government, but simply corporations more powerful than government. The Ecuador example* I've sometimes cited would seem to be most directly on point.
Obviously, there's two problems going on here. The first is the Ecuadorian government's willingness to enable Texaco's predations at the expense of the property rights of the locals. The second is Texaco's willingness to completely circumvent normal legal protections and remedies for the local populace, simply by virtue of the fact that it was actually "bigger" than the state itself.
It is quite easy to see why a country like China would dislike Avatar -- it threatens their exploitative ideology just as much as it would Texaco's. But the moral of the story isn't "yay for market power" so much as it is illustrative of the need to a) establish governmental norms that strongly protect personal rights, particularly of marginalized groups and then b) make sure corporations don't gain so much power that they're able to out-muscle the government.
* Chris Jochnick, "Confronting the Impunity of Non-State Actors: New Fields for the Promotion of Human Rights." Human Rights Quarterly 21.1 (1999) 56-79
Conservatives have been very critical of the Golden Globe-winning film “Avatar” for its mystical melange of trite leftist themes. But what they have missed is that the essential conflict in the story is a battle over property rights....
But conservative critics are missing the conflict at the heart of the movie. It’s quite possible that [director] Cameron missed it too.
The earthlings have come to Pandora to obtain unobtainium. In theory, it’s not a military mission, it’s just the RDA Corp. with a military bigger than most countries. The Na’vi call them the Sky People.
To get the unobtainium, RDA is willing to relocate the natives, who live on top of the richest deposit. But alas, that land is sacred to the Na’vi, who worship the goddess Eywa, so they’re not moving. When the visitors realize that, they move in with tanks, bulldozers and giant military robots, laying waste to a sacred tree and any Na’vi who don’t move fast enough.
Conservatives see this as anti-American, anti-military and anti-corporate or anti-capitalist. But they’re just reacting to the leftist ethos of the film.
They fail to see what’s really happening. People have traveled to Pandora to take something that belongs to the Na’vi: their land and the minerals under it. That’s a stark violation of property rights, the foundation of the free market and indeed of civilization.
I think that's a perfectly tenable interpretation of the movie. I'd question, though, how strong the dissonance is with the "face" (leftist) message.
It is certainly true that the sort of leftist thought that Boaz is identifying Avatar with hardly identifies as capitalist. But that hardly means they can't speak in term of property rights. Indeed, while the anti-colonialist theory being drawn from here would likely not cast things in terms of individual plot ownership, they certainly are quite willing to assert cultural "ownership" of certain plots of land, territories, or resources. Indeed, the Na'vi seem to view these territories as collectively owned by "the people" (there is no indication that any one person in the community owns the land or the unobtanium). This raises a harder question for capitalist theorists than Boaz cares to admit, as capitalist entities have always had trouble figuring out how to handle (read: have felt comfortable ignoring completely) notions of property ownership that were not sufficiently individualistic. The doctrine of terra nullius was applied to claim that places such as Australia weren't actually "owned" by anyone, since the land wasn't titled in a manner that was comprehensible according to contemporary proto-capitalist norms.
But anyway. I think contemporary leftists are more anti-corporate than they are anti-capitalist. The argument in Avatar is that given sufficient power, corporations would be quite willing to ignore such capitalist niceties as property rights and freedom of contract (at least when it suits them). Put differently, the same priors that suggest a corporation would be indifferent to good liberal values like "don't slaughter the natives" would equally suggest that the corporation would be indifferent to good libertarian values like "contract with the natives". The corporation is going to take the least expensive path, whatever that may be, and unless some entity is their to raise the cost of the "killing the natives and taking their property", there's no reason to believe that market economics of all things will act as a restraining force.
So Avatar is an indictment of anarcho-capitalism, to a point, but the twist is it making the further claim that the necessary condition for an anarcho-capitalist hell is not absence of government, but simply corporations more powerful than government. The Ecuador example* I've sometimes cited would seem to be most directly on point.
There, the state had given the Texaco Oil virtually free reign in the country's outland regions. The company responded by engaging in massive environmental degredation at the expense of the nation’s Amazon community. Affected citizens were told that there was no redress available from the company because Texaco was a private corporation and thus not party to relevant treaty law, they would have to go to the state for aid. However, since Texaco’s revenues were 4x the entire GNP of country, and in any event the company was actively backed by the US government, few believed that the nation could stop the environmental destruction even if it were so inclined.
Obviously, there's two problems going on here. The first is the Ecuadorian government's willingness to enable Texaco's predations at the expense of the property rights of the locals. The second is Texaco's willingness to completely circumvent normal legal protections and remedies for the local populace, simply by virtue of the fact that it was actually "bigger" than the state itself.
It is quite easy to see why a country like China would dislike Avatar -- it threatens their exploitative ideology just as much as it would Texaco's. But the moral of the story isn't "yay for market power" so much as it is illustrative of the need to a) establish governmental norms that strongly protect personal rights, particularly of marginalized groups and then b) make sure corporations don't gain so much power that they're able to out-muscle the government.
* Chris Jochnick, "Confronting the Impunity of Non-State Actors: New Fields for the Promotion of Human Rights." Human Rights Quarterly 21.1 (1999) 56-79
Tuesday, January 26, 2010
Interesting Case of the Day
Banco Nacional De Cuba v. Sabbatino, 376 U.S. 398 (1964).
Why? Two reasons:
1) In 1964, it was a U.S. Supreme Court ruling that held in favor of the Cuban government in a case concerning that government's compensation-less expropriation of American property. The case turned on the application of the "state action doctrine", which holds, essentially, that the acts of foreign government's inside their own territory will be considered valid and legitimate.
2) In addressing the question of whether expropriation of property violates customary international law, the opinion notes and gives authority to the opinions of both communist and newly independent countries which argued that such a position was unfair and in service of "imperialist" interests:
I'm not expressing an opinion as to either existence or normative desirability of a customary international legal norm against expropriation without compensation. Rather, I thought it noteworthy both that Cuba won a case like this in American courts, and more broadly, that an American court openly considered the implications of certain perspectives normally considered quite radical and out of bounds in our public discourse.
Generally, this is how one is supposed to approach questions of customary international law, and of course, this is the double-edged sword of that institution: since it represents the customs of the entire world, and there is much disagreement in the world over a variety of customs which we often take to be touchstones of modern human rights standards, generally international law will always be tied to the behavior of its most regressive members. Canvassing the international community in order to determine international custom doesn't mean just looking at countries generally in line with American interests or values, and I thought this case illustrated that in uncommonly vivid fashion.
Why? Two reasons:
1) In 1964, it was a U.S. Supreme Court ruling that held in favor of the Cuban government in a case concerning that government's compensation-less expropriation of American property. The case turned on the application of the "state action doctrine", which holds, essentially, that the acts of foreign government's inside their own territory will be considered valid and legitimate.
2) In addressing the question of whether expropriation of property violates customary international law, the opinion notes and gives authority to the opinions of both communist and newly independent countries which argued that such a position was unfair and in service of "imperialist" interests:
There are few if any issues in international law today on which opinion seems to be so divided as the limitations on a state's power to expropriate the property of aliens. There is, of course, authority, in international judicial and arbitral decisions, in the expressions of national governments, and among commentators for the view that a taking is improper under international law if it is not for a public purpose, is discriminatory, or is without provision for prompt, adequate, and effective compensation. However, Communist countries, although they have in fact provided a degree of compensation after diplomatic efforts, commonly recognize no obligation on the part of the taking country. Certain representatives of the newly independent and underdeveloped countries have questioned whether rules of state responsibility toward aliens can bind nations that have not consented to them and it is argued that the traditionally articulated standards governing expropriation of property reflect "imperialist" interests and are inappropriate to the circumstances of emergent states.
The disagreement as to relevant international law standards reflects an even more basic divergence between the national interests of capital importing and capital exporting nations and between the social ideologies of those countries that favor state control of a considerable portion of the means of production and those that adhere to a free enterprise system. It is difficult to imagine the courts of this country embarking on adjudication in an area which touches more sensitively the practical and ideological goals of the various members of the community of nations. (428-30)
I'm not expressing an opinion as to either existence or normative desirability of a customary international legal norm against expropriation without compensation. Rather, I thought it noteworthy both that Cuba won a case like this in American courts, and more broadly, that an American court openly considered the implications of certain perspectives normally considered quite radical and out of bounds in our public discourse.
Generally, this is how one is supposed to approach questions of customary international law, and of course, this is the double-edged sword of that institution: since it represents the customs of the entire world, and there is much disagreement in the world over a variety of customs which we often take to be touchstones of modern human rights standards, generally international law will always be tied to the behavior of its most regressive members. Canvassing the international community in order to determine international custom doesn't mean just looking at countries generally in line with American interests or values, and I thought this case illustrated that in uncommonly vivid fashion.
Tuesday, June 23, 2009
Bad All Around
I had some reflexive snark reaction to this story about how the business of producing the oh-so-chic keffiyehs has been completely outsourced to China, but really, it's just demoralizing up and down. American hipsters engaging in uncritical faux-solidarity with Palestinians. American hipsters not actually paying attention to the political or economic consequences of their purchasing decisions (there's a huge surprise). Money redirected from a Palestinian economy that desperately needs it to China. And another local industry integral to Palestinian culture shuts down.
Tuesday, April 21, 2009
Whom Do You Represent?
The WaPo (via Kevin Drum) reports that Chrysler turned down a federal loan because its senior executives weren't willing to adhere to pay restrictions.
This gets at an observation I've long had about capitalist economics. Capitalism assumes that corporations will behave in the ways that maximize their profits. But that's not quite right. Corporations will behave in the way that maximizes the interests of their elite decision makers (e.g., the top executives). These overlap considerably, but they aren't the same thing, as this case indicates. To take another example, if the Board of Directors of X-Co, Inc., found that they could save a net hundred million dollars by out-sourcing their own jobs to India, they still wouldn't do it, because executives obviously aren't going to eliminate their own jobs, only other people's jobs.
Top officials at Chrysler Financial turned away a government loan because executives didn't want to abide by new federal limits on pay, according to new findings by a federal watchdog agency.
The government had offered a $750 million loan earlier this month as part of its efforts to prop up the ailing auto industry, including Chrysler, which is racing to avoid bankruptcy. Chrysler Financial is a major lender to Chrysler dealerships and customers.
In forgoing the loan, Chrysler Financial opted to use more expensive financing from private banks, adding to the burden on the already fragile automaker and its financing company.
This gets at an observation I've long had about capitalist economics. Capitalism assumes that corporations will behave in the ways that maximize their profits. But that's not quite right. Corporations will behave in the way that maximizes the interests of their elite decision makers (e.g., the top executives). These overlap considerably, but they aren't the same thing, as this case indicates. To take another example, if the Board of Directors of X-Co, Inc., found that they could save a net hundred million dollars by out-sourcing their own jobs to India, they still wouldn't do it, because executives obviously aren't going to eliminate their own jobs, only other people's jobs.
Tuesday, March 17, 2009
I Can't Believe This Change
AIGFP is now being headed by this guy:
Dead serious. Although I have to say, Che was never this effective at destroying capitalism.
Dead serious. Although I have to say, Che was never this effective at destroying capitalism.
Friday, December 12, 2008
Loss of Faith
After the Blago corruption story broke, Michael of Southern Appeal asked "Do corruption stories ever give big-government aficionados any real worry?" A libertarian leaning friend of mine here at UC asked me roughly the same question. My response was twofold: first, corruption in Illinois state politics is hardly something shocking, so no, I'm not having a crisis of faith, and second, to the extent this is indictment of "big government", it's roughly on par to the effect your average "MegaCorp dumps a billion gallons of toxic waste into local waterways -- local children spotted with extra limbs" has on the die-hard free marketers.
In the vein of the latter, out comes another Wall Street scandal (via Balloon Juice):
Fun fact: I never thought I'd see a business executive describe his own malfeasance as "a giant Ponzi scheme" outside a Dilbert strip.
In the vein of the latter, out comes another Wall Street scandal (via Balloon Juice):
Bernard L. Madoff, a legend among Wall Street traders, was arrested on Thursday morning by federal agents and charged with criminal securities fraud stemming from his company’s money management business.
The arrest and criminal complaint were confirmed just before 6 p.m. Thursday by Lev L. Dassin, the acting U.S. attorney in Manhattan, and Mark Mershon, the assistant director of the Federal Bureau of Investigation.
According to the complaint, Mr. Madoff advised colleagues at the firm on Wednesday that his investment advisory business was “all just one big lie” that was “basically, a giant Ponzi scheme” that, by his estimate, had lost $50 billion over many years.
Fun fact: I never thought I'd see a business executive describe his own malfeasance as "a giant Ponzi scheme" outside a Dilbert strip.
Friday, August 15, 2008
Off Base
I love how the second half of this Lisa Schiffrin post manages to make an unwarranted assertion about West African immigrants (are they predominantly illegal?), totally misunderstand capitalism, and manages to be shocked that African immigrants would greatly prefer Barack Obama to John McCain. It's a lot of dumb packed into a single paragraph.
Via Balloon Juice.
Via Balloon Juice.
Wednesday, June 25, 2008
Zizek on Contemporary Capitalism
It even flirts with readability! My favorite excerpt deals with what he calls the "four antagonisms" that are the primary threats to the viability of the dominant capitalist model in the coming future:
The slum-dwellers, by contrast, he casts as the outsiders to the political community that prevent us from softening the edges of the other three antagonisms by personal action. The slum-dwellers live in an effectively extra-legal position: shorn of effective police and fire protection, beset by crime, outside the "official" economy, and deprived of health and social security protection. Their position is a constant threat to the capitalist order, and can thus act as a catalyst to prevent orderly resolution of the other three.
* I should clarify that I don't necessarily agree with Zizek, but he is an important and interesting writer whose ideas are worth chewing over, no matter how radical they might seem.
[T]he looming threat of ecological catastrophe; the inappropriateness of private property rights for so-called “intellectual property”; the socio-ethical implications of new techno-scientific developments (especially in biogenetics); and, last but not least, new forms of apartheid, in the form of new walls and slums.
The first three antagonisms concern the domains of what political theorists Michael Hardt and Toni Negri call “commons” — the shared substance of our social being whose privatization is a violent act that should be resisted with violent means, if necessary (violence against private property, that is).
The commons of external nature are threatened by pollution and exploitation (from oil to forests and natural habitat itself); the commons of internal nature (the biogenetic inheritance of humanity) are threatened by technological interference; and the commons of culture — the socialized forms of “cognitive” capital, primarily language, our means of communication and education, but also the shared infrastructure of public transport, electricity, post, etc. — are privatized for profit. (If Bill Gates were to be allowed a monopoly, we would have reached the absurd situation in which a private individual would have owned the software texture of our basic network of communication.)
The slum-dwellers, by contrast, he casts as the outsiders to the political community that prevent us from softening the edges of the other three antagonisms by personal action. The slum-dwellers live in an effectively extra-legal position: shorn of effective police and fire protection, beset by crime, outside the "official" economy, and deprived of health and social security protection. Their position is a constant threat to the capitalist order, and can thus act as a catalyst to prevent orderly resolution of the other three.
* I should clarify that I don't necessarily agree with Zizek, but he is an important and interesting writer whose ideas are worth chewing over, no matter how radical they might seem.
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