Robert Coe
On Fri, 21 Mar 2014 00:29:35 -0400, Tony Cooper <tonycooper214@gmail.com> wrote: : On Thu, 20 Mar 2014 21:30:18 -0400, Robert Coe <bob@1776.COM>wrote: : : >On Fri, 21 Mar 2014 11:43:07 +1300, Eric Stevens <eric.stevens@sum.co.nz> : >wrote: : >: On Thu, 20 Mar 2014 18:10:39 -0400, Tony Cooper : >: <tonycooper214@gmail.com>wrote: : >: : >: >On Fri, 21 Mar 2014 09:08:09 +1300, Eric Stevens : >: ><eric.stevens@sum.co.nz>wrote: : >: > : >: >>On Thu, 20 Mar 2014 08:21:19 -0400, Usenet Account : >: >><nospam@invalid.invalid>wrote: : >: >> : >: >>>On 20/03/2014 4:50 AM, Eric Stevens wrote: : >: >>>>On Wed, 19 Mar 2014 22:32:54 -0400, Robert Coe <bob@1776.COM>wrote: : >: >>>> : >: >>>>>On Thu, 13 Mar 2014 12:31:07 -0400, Usenet Account <nospam@invalid.invalid> : >: >>>>>wrote: : >: >>>>>: http://petapixel.com/2014/03/13/calumetphoto-us-declared-bankruptcy-gave-employees-zero-notice/ : >: >>>>> : >: >>>>>That's very sad. (I've been pretty busy and hadn't heard about it until now.) : >: >>>>>Calumet has been very good to CIPNE ("Commercial/Industrial Photographers of : >: >>>>>New England"), whereof I think I'm still a member. Come to think of it, CIPNE : >: >>>>>isn't doing too well itself, I'm afraid. Anybody who could spare a few hours a : >: >>>>>month could probably take over as President, with the heartfelt gratitude of : >: >>>>>the membership. : >: >>>>> : >: >>>>>But anybody who blames Calumet for screwing its employees should get a grip. : >: >>>>>That's the way capitalism works, and is intended to work. : >: >>>> : >: >>>>Rubbish. : >: >>>> : >: >>>>>That too is sad, but it's the way it is. : >: >>>>> : >: >>>>But not the way it should be. : >: >>>> : >: >>> : >: >>>Employees should be considered as secured creditors, and IMHO should : >: >>>have a level of protection. : >: >>> : >: >>>In an era where we see bank and wall street executives with gold and or : >: >>>palladium parachutes, while the working class gets nothing? There has to : >: >>>be some fairness. Don't give me that it's capitalism.. so sad too bad : >: >>>nonsense. : >: >> : >: >>Of course it's not capitalism. It's nonsense to claim that capitalism : >: >>won't work unless you treat your employees that way. : >: > : >: >"Capitalism" is too broad a brush to use to describe this. What went : >: >down was a strategic move by a company, and we can only guess what : >: >determined that strategy. It's probably one of two things: : >: > : >: >a. Management refused to recognize the seriousness of the problem : >: >until there was nothing else possible except closing the doors, and : >: >that was probably forced by creditors. The "strategy", in this case, : >: >is "do nothing and hope a miracle happens". : >: > : >: >b. Management was trying to find a bail-out solution and didn't want : >: >to jeopardize their position by announcing intended closures or : >: >lay-offs. : >: > : >: >In either case, it was bad strategy. : >: > : >: >Realistically, while it may seem unfair, what could have been gained : >: >if the employees *did* have notice? Their jobs are gone either way. : >: >It's not like they would have been able to put feelers out with other : >: >camera stores in the area. They'll be drawing unemployment : >: >compensation a little earlier. : >: : >: If the employees had notice, word would have leaked out into the wider : >: community and the business would have ground to a halt in a confused : >: shambles. They would still have been broke but their affairs would : >: have been in just that more of a mess. : > : >Translation: There wouldn't have been time for the officers to find a way to : >take care of themselves before the s*** hit the fan. Understand that I don't : >know that that's what happened in this particular case, but it IS a : >time-honored capitalist strategem. : > : : Calumet had, at the time of declaring Chapter 7, less than $50,000 in : assets and between one and ten million in liabilities. That indicates : a long-term slide downwards, not a sudden descent. There was time for : any pre-planning the officers wanted to do without a need for an : unannounced immediate closing. : : Capitalism, reduced to the barest definition, is simply an economy : where businesses and resources are owned by individual people and not : the government. A capitalist is a person who believes and : participates in that type of economy. : : The premise that capitalism results in more people lining their own : pockets at the expense of others just doesn't hold water. Look at the : government officials in some of the African nations, Middle-Eastern : nations, and Eastern European nations who have financially raped the : citizenry of their nations. It's not the capitalists who have : billions tucked away in Swiss banks. : : Calumet provided jobs and income to hundreds of employees over a 75 : year span. The income of those employees provided jobs and income to : the many businesses who they patronized. The purchases by Calumet : provided jobs and incomes to many vendors in those 75 years. That's : what capitalism does. : : This isn't a failure of capitalism. It's a failure of a few : individuals to successfully manage a business in a changing market. : Other capitalists reacted more intelligently to the changing market : and provided competition that Calumet couldn't keep up with.

Your "barest definition" of capitalism is too bare. Capitalism relies on the creation of corporate entities that can act as though they were individuals or groups of individuals, while insulating their owners from much of the financial liability that individuals would have to assume. In effect, the people strike a bargain with a corporation's owners, based on the assumption (the hope, really) that in the long run the societal benefit (in economic activity, jobs created, etc.) will be worth the risk.

There are two major problems with the way capitalism is practiced today (at least in the U.S. and probably elsewhere):

- Governments are far too reluctant to pull the plug on corporations that no longer serve the public interest well enough to justify their existence. Sometimes a corporation behaves so egregiously that the government that issued its corporate charter should simply cancel it and revert the corporation to a proprietorship or an unlimited partnership. The company's stock price would probably fall to near (or even below) zero, but the owners would have had it coming. And the threat of such an action would be a powerful motivator to promote good corporate citizenship.

- Corporations, at least in the U.S., have routinely (and almost always successfully) promoted, almost as a constitutional right, the notion that governments have no business competing with the private sector, even in cases where the latter are behaving in a monopolistic manner and screwing the public. But in fact the U.S. Constitution favors no economic system over any other. Even socialism or communism would be constitutional, though I'm not advocating either system. What I am suggesting is that public-sector corporations should be created to compete with the private sector whenever the latter exhibits a self-interested indifference to the public good.

And where is it written that even good corporations should be insulated from any form of public ownership?

Corporations aren't reluctant to seek public "bailouts", willingly trading bonds or ownership stakes to get them. But when things turn good, they howl if the Government wants to keep its stake long enough to make a profit on the public's investment.

Enough ranting. It's not that I'm an actual economist or anything. :^)

Bob