I was asked what demands I would make of Wall Street. None can be accomplished by anyone at Wall Street – though they were all brought about with corporate lobbying pressure – but all pertain to the right to make money:
- Eliminate the punishing corporate tax that reduces competition
- Repeal the capital gains tax, which only creates barriers for people to become rich
- Stop exploitation of corporate profits by labor unions
- Repeal patent laws that confer state-protected corporate monopoly privileges
- Permit pharmaceutical companies to bring drugs to market without mandates or regulatory delays
- Stop restrictions on the use of so-called inside information in securities trading
- Allow buying and selling of securities by anyone in any existing or proposed currency, government or private
- Permit real global free trade by repealing all tariffs and quotas without expecting international reciprocation
- Eliminate child labor laws and minimum wage floors that create mandated unemployment for millions who want to work and make money
- Repeal all health-insurance mandates on corporations and permit new insurers to offer coverage on any terms of their choosing
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But Mr. Tucker, how will we ever survive? It is laws, not capital formation, that have brought about progress in civilization. Don’t you know that the Romans had iPads, personal computers, televisions, and coffee makers that put ours to shame? What a complete ignoramus you are. You want to repeal civilization!
To use Murray Rothbard’s words, I demand that:
“… government should remove itself from all spheres of society just as rapidly as it can be pressured to do so.”
I think the ignoramus us the one that somehow assumes government creates anything, aids in economic or cultural progress whatsoever, rather than what it really does with laws, mandates, decrees, etc…which is destroy it, and society with it.
How about an end to all taxes charged by federal, state and local governments on gold and silver coins and bullion? It would include an elimination of capital gains taxes on gold and silver coins as well as sales taxes charged by state and local governments on all coin and bullion transactions which would result in ending all “legal tender” laws and result in competition in currency.
Much as I admire Jeffrey and his body of work, this smacks of big business favoritism; other than a couple of bullets, one would think this was a Republican’s platform offering.
Moreover, it addresses symptoms and not the disease.
Most of the itemized requests are aimed at reducing “corporate” requirements, when the root cause is the legal entity, created and endorsed and *protected* by the state, entitled “corporation.”
Destroy that unholy alliance, destroy any protection that is not extant for the individual, and the rest shall follow.
Ok, granted but these protestors need to hear the truth of the contribution that business makes to society. And the list is obviously not complete. The whole of the military-industrial complex needs to be completely defunded.
One thing I’m a bit puzzled about is “insider trading”… I understand, you don’t mean to criminalize it. Just treat it as a contract breach. Would you not criminalize fraud, then in general? Isn’t that just some kind of fraud? Is a banking check forgery anything else than a contract breach?
Not every insider trading is a breach of contract.
Insider trading is neither fraud nor breach of contract.
It’s people exercising free speech and communicating knowledge to confidants. This is one of the ways prices have meaning. If the company you work for doesn’t like what you’re doing, they can fire you and tell everybody what you did.
Let’s just call it a conflict of interest. If you are bound to acknowledge a higher interest and you trade against that, then there’s a breach of contract. If you swear to inform everybody about a specific negative influence on prices and instead, you keep on making the market in silence… isn’t that called insider trading? If this makes you personally wealthier but costs your employer more money… than I ‘d say it’s a fraud.
There’s only a breach of contract IF there is a explicit clause in your contract that requires you to acknowledge a higher interest and not trade against that.
Could you make the second part a bit clearer?
About the example: an employee trading a large amount of options at once – much more than the maximum as contractually agreed -, puts his firm at risk, expecting perhaps to get a higher bonus if the deal gets lucky … this shows no “insider trading” but a broader conflict of interests with the clients, and already a responsibility for their losses. Insider Trading may be quite similar. I’m surprise to read posts on the blog pretending it’s not an issue at all.
Look up “insider trading” in the daily articles… there are several that address your questions quite well.
Insider trading laws give the public the false impression that the stock market is mostly fair and that the government is ever-vigilant in protecting their interests.
In fact the stock market a racket and the government is cahoots with the racketeers. All prudent people would be well advised to stay out of trading stocks … but of course many of them are led to do so by the destruction of their savings through monetary inflation.
Not just the stock exchanges but everything that the SEC is involved with. If you read some of the comments by the whistleblower who tried to get Bernie Madoff shut down, it is apparent that there was a lot more going on at the SEC than simple incompetence. Nobody is that stupid, that they can’t put 2 + 2 together even when somebody does all of the investigation for them and gives them absolute proof. Madoff was claiming that he made more profits from trading in a certain market, than the total dollar amount of all business conducted on that market by all parties. I believe there were hints made that the people who benefited most from being at the bottom of Madoff’s pyramid were international mobsters. These didn’t think that Madoff was running a pyramid scheme, but instead they assumed that he was running an illegal insider trading racket. That’s why (it appears) they somehow persuaded the SEC not to do their jobs.
Abolishing insider trading laws would be the same as abolishing the SEC and while it would not in itself clean up Wall Street, it would remove the government fig leaf that hides the ugly truth that Wall Street is many ways the world’s largest and longest-running criminal racket.
Yeah get those those kids out of school into factories where they might acutally learn something.
Since schools are factories, I fail to see how it could be any worse.
you mean labor camps
@Gil
What factories?
Or are you referring to China?
Sadly, in many cases, they would learn a lot more working. And, in some cases, be safer….
Laws don’t end child labor. Prosperity does.
I didn’t realize Gil was being sarcastic until I saw the replies.
If you really want to change Wall Street and the way it operates, then you need to change the incentives that have created the current environment.
That’s easy… eliminate the Federal Reserve.
Note:
Even if you made all the regulatory changes that Jeffrey suggests, Wall Street would not change. You could a make the case these changes might make it worse, but only because these regulatory issues are cosmetic compared to the root of the problem – loose money policies perpetuated by the Federal Reserve and supported by the government (e.g. bailouts).
Until sound money policies are enacted (with or without a Federal Reserve), nothing changes…nada, regardless of (or lack of) regulations.
This is absolutely true.
While I generally agree with Mises thinkers, regarding patents I diverge. You say, “Repeal patent laws that confer state-protected corporate monopoly privileges” which is a sentiment I don’t share. Sounds like socialism for the mind.
It could be argued that current patent law needs to be improved but I do believe in principle that patents are morally necessary and serve an important function in a free society. The notion that somehow the State granting a monopoly on an idea is a bad thing does not wash with me. If you take such a position, then you invalidate all property rights. Doesn’t the State enforce a monopoly on physical property as well? It seems rather silly to me to make the argument that say, Kinsella makes, that property rights should only extend to physical property because it’s not copyable. I guess I’m a Randian with respect to IP; that ideas are products of the mind.
In practice, eliminating patents would essentially destroy the independent innovator. I seriously doubt the Wright Brothers would have invested their time and money and risked their necks to develop the airplane only to have every major manufacturer of the day then simply copy the design to leave them with nothing.
A novel idea for a device that creates new functionality should be treated legally as physical property (for a reasonable period of time) and copying it for financial gain as a trespass.
” I seriously doubt the Wright Brothers would have invested their time and money and risked their necks to develop the airplane only to have every major manufacturer of the day then simply copy the design to leave them with nothing.”
In this case, patents by the Wright Brothers actually caused the US to lag way behind in technology and innovation compared to Europe and Japan until WW II.
That’s only because the US gov’t refused to deal with the Wright Bros. European gov’ts did agree to license the designs. What is not factored in the anti-patent position though is the opportunity cost of not having patents. My point is that the Wright Bros would not have had the incentive to innovate therefore there wouldn’t necessarily have been a flying machine in the first place.
“European gov’ts did agree to license the designs.”
Really! And why would European governments “license the design” of two unknown Amurricans whose design was not even that ingenious?
http://en.wikipedia.org/wiki/The_Wright_brothers_patent_war
This is very true. I don’t have a source for it but I was told by someone who was an aviation-history enthusiast that thanks to the Wright Bros. sitting on the industry with their patents, by 1914 there was only a handful of airplanes flying in the USA. Probably most of them followed the rather primitive pattern of the Wright “Flyer”. Whereas in Europe where US patents didn’t apply there were hundreds of airplanes flying, whose design pointed the way to the future (such as Bleriot’s low-wing monoplane). Most of the individual European countries had a patent offices, but as far as I know there was little or no respect for patents across international borders – therefore these inventors worked in the full knowledge that their designs (if successful) would be quickly copied elsewhere.
I don’t know whether the Wrights would have invested their time and money without a patent system in place, but apparently there were many other inventors around the world working for the same goal without the benefit or hope of extensive patent protection. Given the advances in gasoline engines and the well-know technology for hang gliders and kites, it is inconceivable that they would not have achieved results that were equal to or even better than the Wrights.
“I don’t know whether the Wrights would have invested their time and money without a patent system in place…” They wouldn’t.
“…there were many other inventors around the world working for the same goal without the benefit or hope of extensive patent protection.” Maybe, but who actually did it? Not unsurprisingly the ones who were most motivated by the profit potential.
“…there were many other inventors around the world working for the same goal without the benefit or hope of extensive patent protection.” Maybe, but who actually did it?
Probably Richard Pearse.
The Wrights were fascinated by the idea of heavier-than-air travel. One might even say obsessed. You’ll need more than a 2-word assertion to prove that they wouldn’t have gone ahead and experimented with planes without the patent system.
“You’ll need more than a 2-word assertion to prove…” My assertion is as good as yours… but here is an excerpt from Wikipedia:
“After the Kitty Hawk powered flights, the Wrights made a decision to begin withdrawing from the bicycle business so they could devote themselves to creating and marketing a practical airplane.[58] The decision was financially risky, since they were neither wealthy nor government-funded (unlike other experimenters such as Ader, Maxim, Langley and Santos-Dumont). The Wright brothers did not have the luxury of giving away their invention; it was to be their livelihood. Thus, their secrecy intensified, encouraged by advice from their patent attorney, Henry Toulmin, not to reveal details of their machine.”
Looks like they were clearly motivated to protect their financial interest to me…
Sources: Against Intellectual Monopoly, Chapter 4, Section 2, “The Dilbert Factor” and Ibid, Chapter 8, Chapter, Section 4, Subsection 2, “Locking and Unlocking the Skies”
http://www.4shared.com/file/9RfTeyX0/Against_Intellectual_Monopoly.html
The arguments presented in “Against Intellectual Monopoly” are all utilitarian. And utilitarian arguments swing both ways. It’s ironic that there is an effort by anti-IP advocates who want to claim the moral high ground and then default to utility argument. Such arguments can apply to physical property as well. It’s basically the rationalization of theft.
Why should a farmer be permitted to a monopoly to farm his land when a more productive competitor would render greater social value? The competitor should be allowed to simply occupy any land not currently in use irrespective of ownership. In fact, isn’t there a compelling argument that strictly on a social utility basis the more productive competitor should be obligated to take the land from the less productive farmer?
The problem of course is that taking the land away from the less productive farmer would result in moral injustice and conflict. The same is true of IP. The challenge for IP rights is in definition and legal execution but the moral imperative is the same as for physical property.
“Why should a farmer be permitted to a monopoly to farm his land when a more productive competitor would render greater social value? ”
What do you mean permitted? Rights are to be recognized. There is no central planner who ‘permits’ rights.
The nature of rights is such that there is no moral defense to violating them. Here’s a post I really liked explaining why that is so.
http://blog.mises.org/11162/an-objectivist-recants-on-ip/
@Kashyap – “What do you mean permitted? Rights are to be recognized. There is no central planner who ‘permits’ rights. ”
You didn’t respond to my post.
My argument with respect to rights is that I have a right to my intellectual property just as I have a right to my physical property. My example of the farm is to say that if you take a utilitarian point of view, then by that reasoning, you should also argue that a less productive farmer should forfeit his land to a more productive farmer to better maximize the value of the land. But I understand the Austrians to say that it is *morally* wrong to take the physical property from the less productive farmer.
So on one hand, the Austrians use a *moral* standard for physical property rights and then flip flop to a *utility* standard with respect to IP. This is inconsistent.
And there is no such thing as a “right.” I challenge anyone to give me the dimensions of a right or the mass of a right. What are the physical properties of a right? Therefore there is no such thing as an “inalienable right.” A right is only what *society* legally defines it to be. A right is a product of logic and reason and inescapably subjective and abstract. So, a society must define what rights are in a legal context. They don’t exist in nature.
@kashyap – “The nature of rights is such that there is no moral defense to violating them. Here’s a post I really liked explaining why that is so.”
Yes, I agree that there is no moral defense for violating rights which is why I defend IP rights. After reading that thread, I remain unswayed.
Bala raises these questions:
- “How do you reconcile the facts that recognizing and enforcing IP essentially gives
some people a right to the physical property of others?”
I see this as a false dilemma. The IP right precedes and therefore takes precedent over the physical property (presumably created using the IP). It’s the same as saying that if someone steals your car you can’t reclaim it because that would be stealing from him.
- “How can ideas and patterns be property?”
That’s a matter of definition. Just as mineral rights or ownership of a condo is a matter of legal definition.
- “How do you propose to enforce IP except through the State machinery? Considering that the State has never demonstrated any tendency other than for evil, how is this consistent with the advancement of Liberty?”
All rights are enforced through the “machinery” of the State. It does not follow that if the State has a tendency to evil that it must be so. The gov’t must be limited to enforcing laws and national defense. I’m a Nozick minarchist in this regard. The State is an inevitable consequence of society. The anarchist ideal is untenable.
It’s not so much a defense based on utilitarian grounds as a refutation of the pro-IP position on utilitarian grounds. The pro-IP position cannot be supported by utilitarian arguments
@Michael A. Clem October 10, 2011 at 3:05 pm “It’s not so much a defense based on utilitarian grounds as a refutation of the pro-IP position on utilitarian grounds. The pro-IP position cannot be supported by utilitarian arguments.”
How so? I’ve just made a pro-IP utilitarian argument that no one here can refute. That eliminating IP will stop risk-taking and certainly eliminate the independent innovators. I used the Wright Bros. as my example which I think is supported by the Wikipedia excerpt I posted above. Had they not been able to pursue the patent, they wouldn’t have risked their capital. That’s pretty obvious.
parker,
This argument has already been refuted in the past, prior to your comments. IP is a redistributive mechanism and you are analysing the revenue side while ignoring the cost side. There is no apriori reason why IP should result in a net gain for any particular inventor. Most likely, some will win and some will lose. The only way to ensure that one will benefit from IP is not to read any books, not use any tools, not look at anything and not listen to anyone. A close approximation of this are patent trolls: they buy patents and then attempt to “sell” them at a higher price. You could see them, with a bit of exaggeration, as merchants: they buy low and sell high. But they don’t manufacture anything.
“Sounds like socialism for the mind.”
awwwnotthisshitagain.jpg
In practice, eliminating patents would essentially destroy the independent innovator. I seriously doubt the Wright Brothers would have invested their time and money and risked their necks to develop the airplane only to have every major manufacturer of the day then simply copy the design
So what? Then somebody else’s aeroplane design would have taken off (haha). It’s not like they came up with the concept all on their own; plenty of people were playing with it at the time.
“So what?” So what if someone steals your car. There are other cars for you to choose from. So what if someone cleans out you bank account, you can open another one…
“It’s not like they came up with the concept all on their own; plenty of people were playing with it at the time.” They came up with the first design capable of sustained controlled flight. And “playing” around is not the same thing as developing a novel new device or machine. The Wright Bros spent four years and a lot of money to develop their airplane. Have you ever tried to develop a novel, functional and non-obvious device? I have. I spent over a year developing a new “machine” that I did patent. Most R&D is not casual playing around.
If a company spends million$ in development of a new technology, why should their investment and risk be expropriated by competitors? At this point, the Austrians seem to devolve into rationalized arguments from utility of why stealing IP is ok. It just doesn’t wash.
Prove your assumption that a person can own and idea, then maybe I will credit your claim that someone can steal one. After all, if I “stole” your idea that should mean that you are unable to use it, right?
These are two distinct assertions.
1) Prove someone can own an idea.
A patent is title to an idea. How does someone prove they own their house? Prove they own their car? Prove they own their land? There are legal records that defines ownership. Same holds for IP in the form of patents and copyright.
2) Theft of an idea still means it can be used.
The loss of physical property is not so much that you can no longer use it per se, but that you can no longer benefit from its *value* to you. In the same regard, IP has commercial value to the holder. Through theft (ie copying the idea), the owner has lost its commercial value. You have a monopoly on the physical property you possess and that monopoly provides exclusive value to you. Same for IP in that having a monopoly on the idea provides value to the owner. I see no distinction.
1. Begging the question
2. LTV
Hi,how are you?Do you know about best economic web site on online?I am a student from National University of Mongolia.I’m looking for an economic web site which I can ask my questions and solutions.here is my question.
This is about economic solution.There are 2 regions but they were given by different each other function of demand and supply.1.First question is we won’t sell these products on both regions and you can’t transport the product each other.So please find the equilibrium price,equilibrium quantity,shortage and surplus of goods on one by one.Functions were written below.
a.Q(demand)=50-0.5P
Q(supply)=-10+P (first region)
b.Q(demand)=120-P
Q(supply)=-20+P (second region)
2.If you can transport the product to these 2 regions cheapestly,please find the equilibrium quantity on these 2regions one by one.If you can’t transport any product from first to second region,who can get a profit from them?.Who can’t get a profit from these condition?
1. No
2. It’s a made-up imaginary scenario where a mathemagical formula represents this imaginary reality perfectly. Just use a simplex algorithm.
3. Get out
4. Ontological economics (or ethics or sociology or whatever) can rationalize (literally) anything. Hence it is a trivial exercise in attempting to justify your own desire to lord over others because you think you’re somehow more intelligent than them (hint: you’re not)
We aren’t going to do your homework. Sorry, look elsewhere.
Congress shall not exempt themselves any laws they pass.
For example, if lying to congress is a crime, the politicians lying should also be a crime.
Why is it OK for Eric Holder to lie to congress about selling arms to drug dealers, while we spend $20 million prosecuting Roger Clemens over something as inconsequential as lying over drug use in baseball?
A President (of whatever ethical coloriage or gender) shall not exempt himself from following the laws he passes by using “signing statements” or legal casuistry coming from random White House Legal Counsel, nor shall he be alllowed to use the Constitution as toilet paper.
@parker: “My argument with respect to rights is that I have a right to my intellectual property just as I have a right to my physical property. ”
How does an idea or pattern become property? Is creation the source of rights?
“And there is no such thing as a “right.” I challenge anyone to give me the dimensions of a right or the mass of a right. What are the physical properties of a right? Therefore there is no such thing as an “inalienable right.” A right is only what *society* legally defines it to be. A right is a product of logic and reason and inescapably subjective and abstract. So, a society must define what rights are in a legal context. They don’t exist in nature.”
Meaningless mish-mash of words. No conclusion flows from the premises used. Let me define rights for you: Rights are those which are essential for the existence of man qua man. Their source: objective reality. Rights are inalienable because they cannot be separated from man, in much the same way attributes cannot be separated from entities.
A right is what society defines it to be? Society consists of men. Men define rights using reason. And, does employing reason as a method of concept formation make rights ‘subjective’? The only part you’ve got right is that rights don’t exist in nature. Yes, they are recognized, they don’t exist, as I’ve already pointed out. And by the way, you owe me a dollar for copying my idea that rights don’t exist.
@parker: “- “How can ideas and patterns be property?”
That’s a matter of definition. Just as mineral rights or ownership of a condo is a matter of legal definition.”
The State defines taxation in such a way that it avoids saying taxation is theft/legal plunder. So, if it’s all a matter of legal definition, then taxation is not theft! Way to go.
“If a company spends million$ in development of a new technology, why should their investment and risk be expropriated by competitors? ”
The onus is on you to prove that there has been an expropriation. Oh, IP law legally defines copying ideas as theft. So that proves the expropriation. All hail legal definitions.
“The loss of physical property is not so much that you can no longer use it per se, but that you can no longer benefit from its *value* to you. In the same regard, IP has commercial value to the holder. Through theft (ie copying the idea), the owner has lost its commercial value.”
Value is subjective. Commercial value simply means exchanging a subjective value for money. The “IP” holder has no claim on the subjective value in his customer’s mind.
Nit-picking the regulations isn’t the way to criticize what the govt has done to the market. What should be demanded is personal choice in a regulatory market.
The NYSE, NASDEQ, etc. can certainly set and enforce rules on those companies that will be listed, and these could indeed mimic many, if not most, of the current govt regulatory rules – even imposing things like insider trading rules, minimum wages or union rules if the companies wish to remain listed.
Progressives and labor unions are both trying to stake a claim and/or co-opt Occupy-Wall Street, but they don’t seem to be getting very far with that.
Permit real global free trade by repealing all tariffs and quotas without expecting international reciprocation.
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