Quotulatiousness

April 14, 2014

In defence of limited corporate liability

Filed under: Business, Law, Liberty, USA — Tags: , , — Nicholas @ 10:47

The RSS feed that used to track Megan McArdle’s posts at Bloomberg View has been on the fritz for a couple of weeks, so I missed this article when it was posted earlier this month:

The argument for unlimited liability isn’t just a libertarian evergreen; it’s also something you occasionally hear from the far left, because it would basically make the corporate form untenable. Imagine, if you would, that by buying and holding the share of a firm for 10 minutes, you thereby subjected yourself to seizure of all your goods to satisfy potential lawsuit judgments — even if those judgments involved behavior that involved no legal liability at the time of the acts.

Not possible? That’s basically what happened with asbestos liability. Firms that had had no legal liability under the doctrines of the times in which the asbestos was sold or used suddenly found themselves driven into bankruptcy by massive settlements. Moreover, after the first wave of lawsuits exhausted the funds available to pay asbestos claims, plaintiffs’ lawyers started pushing to expand the number of pockets that could be dipped into.

A company that had never manufactured asbestos could be sued and have to spend hundreds of millions of dollars on lawsuits and settlements because it had once bought a company with an insulation division that had formerly manufactured asbestos — even though it had immediately sold off that division in the process of completing the merger. Insurers could be forced to pay out for the whole of a company’s liability if they had sold a company insurance for even a year between the time a company started making or using asbestos and the time that the plaintiff discovered the harm. And “harm” wasn’t limited to getting sick; you could sue for the emotional distress of worrying that you might get sick.

Kind of hard to imagine becoming a shareholder under those circumstances, isn’t it? Maybe you’d better put your money in the bank — a small, privately held bank, of course. Commerce would look something like it did in medieval Italy, where all economic activity was basically organized by the family or the partnership.

Growth would have to be financed by debt or by retained earnings. That’s how British firms financed expansion in the early days of the Industrial Revolution. It’s how small businesses tend to finance expansion now.

The traditional libertarian answer is “insurance”, but that’s a non-starter as well.

To which I answer: What insurance company?

Insurers are also corporations, and their owners get the same valuable shield from liability that everyone else gets from the corporate form. They may have shareholders, or they may be mutually held by their policy holders, but either way, someone is getting protection from lawsuit by the same laws that protect General Motors Co. This sort of liability shield is vital for any large aggregation of capital requiring lots of contributors — which is basically the definition of an insurance company.

Queen’s student goes looking for racism, doesn’t find it, declares it’s happening anyway

Filed under: Cancon, Politics, Religion — Tags: , , , , — Nicholas @ 08:44

Your source of all sorts of odd news, the Daily Mail has this little gem from up the lake in Kingston, Ontario:

A Canadian college student recently conducted a social experiment to see if people treated her differently if she wore a hijab — a traditional Muslim veil that covers a woman’s head and chest — and what she discovered was a bit unexpected.

Anisa Rawhani, a third-year student at Queens University in Ontario, wore the traditional Muslim garb for 18 days in January as she worked at the university’s library, visited stores and restaurants near the campus and as she did volunteer work with local children.

According to Rawhani — who conducted the experiment to see if people in her community were racist towards minority groups — she noticed that people actually treated her more kindly and with more respect than when she didn’t wear the hijab.

Rawhani, who is not Muslim, wrote about her experience wearing traditional Muslim clothing in the March edition of the Queen’s Journal, where she works as a copy editor — the article is titled ‘Overt to Covert.’

Fortunately, as the Queen’s Journal account makes clear, she was able to get a clear explanation of the phenomenon from a professor:

Leandre Fabrigar, an associate professor in the department of psychology at Queen’s, cited “impression management” as a possible explanation for my experience.

He explained that often individuals who harbour biases, but fear social disapproval, will publicly act respectfully towards minorities. “Impression management is when [someone] very strategically, and usually quite deliberatively, tries to manage the impressions that others have of [them],” he said.

Impression management is focused on manipulating others’ perception of the self, but there are more genuine reasons why someone would be kinder towards minorities. Fabrigar said that sometimes individuals realize that they harbour biases, or other unwanted influences on their behaviour. Then, when interacting with members of minority groups, they experience an internal conflict between their negative biases and the egalitarian values that they believe in.

So the fact that Rawhani didn’t encounter overt forms of discrimination actually proves that the people she was interacting with in her Islamic disguise are hugely bigoted, hate-filled wretches who just don’t want to show it. Cool, got it, thanks.

SpaceX to test hover capability on next launch

Filed under: Space, Technology — Tags: , , , — Nicholas @ 08:25

In The Register, Brid-Aine Parnell explains what will be different about the next SpaceX launch to resupply the ISS:

NASA has said that SpaceX’s latest cargoship launch to the International Space Station will go ahead, despite a critical computer outage on the station, allowing the firm to test the craft’s hovering abilities.

[…]

The booster rocket that’s blasting the Dragon supply capsule into space is going to attempt to make a hovering soft landing after it’s disengaged and dropped back to Earth.

The spruced-up Falcon 9 has its own landing legs, which Elon Musk’s space tech company hopes will eventually make for precise set-downs on the surface of alien worlds. For this test though, the rocket will still be coming down over the ocean, just in case.

The launch is already a month late with its nearly 5,000 pounds of supplies and payloads, including VEGGIE, a new unit capable of growing salad vegetables for the ‘nauts to munch on. The ship was delayed from March after a ground-based radar system at Cape Canaveral was damaged.

You can tell it’s really Spring in Toronto

Filed under: Cancon — Tags: , , — Nicholas @ 08:10

The weather forecast for today and tonight contains a little bit of everything:

Update: The rest of the story:

With spring now well over three weeks old, the snow tires are off, the yard work has begun, and the boots and parkas are already at the back of the closet

However, winter weather is expected to make a comeback on Tuesday, as much of the province will see a major swing in temperatures and a mixed bag of precipitation.

Temperatures are expected to plummet from a high of 21 C on Monday to a low of -7 C on Tuesday night, with the potential for freezing rain and snow.

Ahead of winter’s reappearance, it will be a warm day for parts of southern Ontario on Monday as temperatures may reach the mid-twenties mark.

Environment Canada has once again issued a “special weather statement”, which they seem to do every other day recently. It’s not a storm warning or even a storm watch, but just a “hey, there’ll be some weather!” kind of thing. A communication tailored to the fact that weather is now treated like celebrity news in a lot of media markets.

QotD: Collard’s Law

Filed under: Bureaucracy, Humour, Quotations — Tags: — Nicholas @ 07:08

Given enough funding and little accountability, any organisation tends to look like a shit copy of the public sector.

Lewis Collard, in a comment on ESR’s Google+ post, 2014-04-13

Canada’s potential influence in East Asia

Filed under: Cancon, China, History — Tags: , , — Nicholas @ 00:01

In The Diplomat, Anthony V. Rinna looks at Canada’s rather history of diplomatic and cultural exchanges with China:

Canadian Prime Minister Stephen Harper has noticeably changed his stance toward China. Previously, the Conservative prime minister maintained a hard line against the PRC based on what he perceived as a poor human rights record. That position has softened over recent years. This seems to be part of a broader strategy aimed at transforming Canada, traditionally Atlanticist in its political leanings, into a leading actor in the Asia-Pacific. Specifically there is ample opportunity for Canada and China to enter into a symbiotic energy relationship. China of course desperately needs energy, and wants a diverse base of suppliers. Canada, in turn, is a major energy producer and exporter and would find a very willing customer in China.

Among the Western democracies, Canada has something of a history as a catalyst vis-à-vis the West’s relations with China. Canadian Prime Minister Pierre Trudeau was the first Western leader to open up to China, starting in 1970 when Canada officially recognized the government in Beijing as the legitimate government of the land (and the stage had been set for this by Trudeau’s predecessor, John Diefenbaker). Although Hugh Stevens of TransPacific Connections attributes Canada’s renewed interest in strengthening ties with China in part to following the lead of the U.S. “pivot” toward Asia, Canada has the potential to again be a leader and innovator in its own right. Canada’s own unthreatening position can only help.

While Canada’s relationship with China is largely based on trade and investment, military relations between Canada and China continue to develop apace, well beyond the conventional placement of military attachés at each country’s respective embassies in Beijing and Ottawa. In March 2012, then-Canadian Chief of Staff General Walter Natyncyk participated in a high-level visit to China and met with top brass from the People’s Liberation Army. In August 2013, Robert Nicholson, who had become Canada’s Minister of Defence only a month earlier, held talks with his Chinese counterpart Chang Wanquan on deepening Sino-Canadian military cooperation.

[…]

Canada has used its position to ease Asia-Pacific tensions in the past, for instance during the South China Sea Dialogues in the mid-1990s. James Manicom of the Centre for International Governance Innovation argues that the Track II-style of Canadian involvement in the 1990s may no longer be appropriate or effective given the rise in regional tensions. Nevertheless, as Canada’s military engagement with China increases, this still leaves the possibility of Canada playing a role in soothing regional tensions on an official level.

Ottawa has positive relations with the other states with territorial interests and disputes in the South China Sea. For instance, 49 percent of Indonesians say they have a positive view of Canada (and only 16 percent express a negative view). In line with its progressive stance toward China in the 1970s, Canada also recognized Vietnam diplomatically toward the end of the U.S.-led Vietnam War (whereas the U.S. only normalized relations with that country late in the administration of President Bill Clinton). Thus, Canada may be in a position to assist not only as a third node in a Canada-China-U.S. strategic triangle, but also to use its own diplomatic clout hand-in-hand with its growing military ties to China to work between China, the U.S. and U.S. partners in the region, many of whom have called for American assistance in counterbalancing China.

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