So, why are Gibson guitars being subjected to a Federal witch hunt?

[dibl]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

Every group enterprise needs a governing structure of some kind. The stockholder corporation is a convenient structure to allow many hundreds or thousands of people to participate in the fortunes of a business enterprise. It's not the only structure, and corporations are not the only way to organize a business venture. I don't think there is anything inherently more frightening about a corporation than there is about a privately held business venture, or a big university, for that matter. I think people are understandably put off by the amoral nature of corporate governance and direction -- we tend to look for good and evil in all things, and most business organizations don't really have a moral code, at least not one that is relevant to individual human beings.

And, to quibble perhaps, corporations and other businesses are NOT, IMHO, creations of the state -- they are creations of their founders and incorporators and investors, and then are supported by their customers and employees. The State merely authorizes their operation, within regulated limits. Once in awhile the State creates a big semi-business enterprise, like Fannie Mae, but those are the exceptions, and are rarely noteworthy for their return on the investment.

[GreyGeek]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

....
The "personhood" of corporations is just a legal nicety to establish their standing in our judicial system. You have to be a legal person to bring a suit, to be sued, and otherwise to be subject to decisions of the courts. It's not the same as "citizenship", which conveys the right to vote, and the rest of the Bill of Rights. If you went to a charter system, who are you going to sue or otherwise hold liable when the train goes off the track?

"Who are you going to sue or hold liable?" The very people who obtained the charter or receive profits from its activities. The charter gave permission for a group of people to do what one person cannot do because of limitations of workforce or money. It was granted for a specific purpose or for a specific duration. Regardless of the success or failure of the purpose of the charter, when the time limit expired the charter was null and void. It could not morph into another entity with a different purpose. Tricky accounting rules and dummy charters was not possible.

The corporation has evolved into a "person" who has MORE rights than you or I by virtue of its wealth and influence. As I've said before, the CEO, chairman of the board, owner, etc... of a corporation, by virtue of their control of large amounts of wealth, large armies of lawyers, and their employment of large numbers of people, can revoke or reverse the desires of millions of citizens merely by bribing a few corrupt politicians. But, recent SCOTUS decisions have removed ALL corporate restraints. They have no limits on the sizes of their bribes or to whom, and they can keep all such bribes secret, rolling them into a single entry on their books debiting cash and crediting "public works".

It doesn't stop with money. Corporations extort special favors and tax exemptions from local and state governments as an "incentive" to open facilities in those areas, even though corporations pass all taxes along to the consumer in the form of higher prices. So, in affect, the taxpayers pay extortion money to wealthy corporations, a.k.a. corporate welfare, in a supposed quid quo pro for jobs, in addition to paying more for their products. Sooner or later corporate bean counters realize that the slack variables in their business equations for that area have become unfavorable. Either more extortion is attempted or the factory lays off everyone, moves or sells the equipment, and opens an identical factory in another city or country. I've seen that happen three or four times in the last ten years here in Lincoln.

BTW, the idea of "personhood" of corporations was written into the "header note" of a 1886 court case of Santa Clara County v. Southern Pacific, by a court reporter. The court reporter, former president of the Newburgh and New York Railway Company, J.C. Bancroft Davis, wrote the following as part of the headnote for the case:

"The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of the opinion that it does."

In other words, the headnote indicated that corporations enjoyed the same rights under the Fourteenth Amendment as did natural persons. However, this issue was not decided by the Court.

Well, I suppose if reasonable inducements for investors were in place, then that could work. What inducements would you offer, to compensate investors for risking their capital?

The very same inducements they've always had -- the opportunity to make profits from the scheme their charter authorizes them to do.

Personally, if I were King, I would keep the stockholder corporation (and the various other business organizational methods), but I would require every business over a rather small size, like 15 employees, to adopt a model ESOP and share both profit and the value of stock appreciation with the employees. No gimmicks allowed -- the employees must do equally well (or badly) as the most advantaged stockholders in the business.

Not a bad idea, but somewhere in the mix the ability of the corporate owners and mangers to bribe elected officials or influence public political opinion has to be stopped.

[GreyGeek]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

@GReyGeek

I mentioned this in another thread before, but what do you think of Christian (or Centrist) Democracy or Distributism. They look like what you could be looking for.

Not much for either idea.

The other problem with corporations I haven't addressed is their "mandate" to maximize the profit of the shareholders, or the owners and managers. Without the force of law to restrain them they have no concern for the damage to the environment or the people that their processes create. Nor do they consider the limits to exploitation that exist naturally in those resources. For example, total amount of recoverable coal and oil resources are well known. It is also well known, but not widely understood nor believed, that the rate of consumption of those resources is increasing exponentially. Not only are the 1st World cultures increasing their use of those resources to sustain or increase their standard of living, but lesser developed cultures are demanding access to those resources in order to enjoy the same standards that we have. Rather than let our rate of consumption rise at 5.6% per year we should be cutting back at about -3% per year in order to leave some of that resource for our children and grandchildren. But we won't save any seed corn. We're eating it all up.

[dibl]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

The very same inducements they've always had -- the opportunity to make profits from the scheme their charter authorizes them to do.

No, you don't understand. "Profits" (aka dividends) are the least interesting of the possible rewards from stock ownership. If an enterprise is hugely successful, then the real reward comes from appreciation of the per-share value. The time required for the enterprise to achieve big success is not knowable, therefore the investor expects to hold his shares for an indeterminate period of time, awaiting the "homerun" value proposition that will dramatically increase the value of his shares. A charter, with an end date, would destroy the possibility of holding a position until the moment arrives to capitalize and reap the reward.

[GreyGeek]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

Oh, I understand alright. From my POV it's just another aspect of corporations that is abused by big money at the expense of the small folks. I'm thinking of Dick Lay, who was selling his stock in Enron while he is addressing groups of his employees encouraging them to buy the very stocks he was selling. Ditto for World Com. And need I mention the biggest Ponzi Schemer of all, Madof? Companies and financial services at the top of the pyramid conspire to print lottery tickets to sell to those at the bottom.

If the stock market is such a good deal one has to ask why those financial services needed 1 Trillion dollars to keep from collapsing. We'll never see that money again. It's already in mansions, ships, gold, etc..., off shore.

Unless a corporation returns dividends to stockholders, the owner of a share of stock holds essentially nothing. An asset is only worth what someone else is willing to pay for it. Some assets possess some intrinsic value, but stock has no intrinsic value. It’s like any other currency, and the people who create the currency have the power to devalue it at their own discretion. That's how Microsoft could print stock options in their back room as payment to the coders who wrote Win95. The coders had to cash in their options to get money (paid) and pay the option fee as well (pay cut). Microsoft, on the other hand, because of bribes to Congressmen, got a line item in a bill which allowed THEM to get a "refund" from the Government (corporate welfare) equal to the amount of the stock options.

[dibl]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

If the Board of Directors fails to exercise its responsibilities (Enron), or if risk rating "experts" and banks are incapable of imagining that housing values might not be exempt from the law of gravity (mortgage-based fiascos), or if a pathological liar is permitted to preside over the business (Madoff), then I kinda doubt the form of business organization is going to provide immunity from losses. Would the overseers of State-granted charters be immune from such human failures and weaknesses, including susceptibility to corruption? I think not.

[charles052]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

I think the problem here is the same problem with any government: corruption.

Our officials have simply gotten too big for their britches. Our forefathers of the great 'US of A' had it right when they created this republic, in which the citizens are protected under a set of laws. It was up to us, the people, to protect those laws, protect our fellow citizens, and our freedoms.

What has happened is that we depend too much on our government and give it far more trust that it deserves. We've given it far too long a leash and it now needs to be pulled back.

Our laws, if governed properly, would have prevented this and every other form of corruption whether it be corporate or government.

[GreyGeek]

Re: So, why are Gibson guitars being subjected to a Federal witch hunt?

....
Would the overseers of State-granted charters be immune from such human failures and weaknesses, including susceptibility to corruption? I think not.

Exactly. The bottom line is that regardless of the political or economic system when corruption takes hold, all systems fail. The terminal condition of any system is totalitarianism, politically like that in China, or criminally like that in Mexico.

My contention is that corporations have, because of their corruption of the three branches of government, been given MORE rights that real, flesh and blood citizens. This HAS to change. Our government has already been transformed into a cabal in which the corporations control the agencies which are supposed to regulate them, and they bribe our elected representatives to maintain that control. Add to that people who are acolytes of a 160+ year old political document and are bent on alienating the unalienable rights enumerated in a 235 year old political document that is the foundation of our democracy, and one can see the perilous condition our country is in.

Corporations give trips to resorts to judges so that they can be tutored on how to make court decisions that help corporations skirt or evade laws like the Sherman-Clayton Anti-Trust Act. I still can't understand how the majority of SCOTUS, at least half of whom are liberal, could have agreed that corporations have a right to give money in any amounts to politicians without limit or accountability. Or that the EULA is a law which corporations have a right to rewrite without notification at any time, but they themselves don't have to honor. Or, getting back to the topic of this thread, why a gang of enforcement agents thought it was necessary to stage a "raid" on Gibson's factory using automatic assault weapons? Having raided that factory before, they had no cause to suspect that they would be met with armed resistance, so why the display? To create fear using intimidation. As someone wrote, a people who fear their government are living under a tyranny. A people whom the government fears are living under liberty.

To make matters worse, as stories around these various issues arise in the media, their comment sections become filled with useless insults, baseless accusations, distorted facts, or outright lies. Now, on national media, leaders of factions are escalating threats from one of cross-hairs on maps to threats of violence, like "let's take the sons of b**** out". How much higher do they think they can ratchet up the rhetoric before someone decides to take them at their word?

In my original post I wrote that I doubted that any of my suggestions would ever happen. As long as no changes in the status quo are made things can only get worse. Reigning in runaway corporate power is a good place to start. That can only happen by voting out MOST of the politicians now serving, and the newly elected politicians RIF'ing the bureaucracy down to size so they can't thwart the will of the voters. But, how to you select honest politicians from a pool of candidates with the same moral compass as the old politicians?