Another question about free-markets...

Milton Friedman won the Nobel price in 1976 in economics. One of the
questions he asked was:

Do corporate executives, provided they stay within the law, have
responsibilities in their business activities other than to make as much
money for their stockholders as possible?

His answer was 'no', they have no responsibility outside of those two
considerations (ie the law, stockholders expectations of profit).

Now in a free-market, by definition, there is no law. What then is the
responsibility of businesses other than the pure unadulterated pursuit of
profit? If this includes lying, denying consumers information, etc. what
harm is done, they have fulfilled their responsibility to their shareholders
(potentialy quite lucratively) and broken no law. Within this environment it
follows that a primary strategy for such executives is the elimination of
*all* competition. And since there is no law other than the measure of profit
all can be justified.

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At 11:53 PM 10/4/98 -0500, Jim Choate wrote:
> Now in a free-market, by definition, there is no law. What
> then is the responsibility of businesses other than the
> pure unadulterated pursuit of profit? 

None whatsoever.

> If this includes lying, denying consumers information, etc.
> what harm is done, they have fulfilled their responsibility
> to their shareholders (potentialy quite lucratively) 

While there is a sucker born every minute, the strategy you
describe is for the most part unlikely to be profitable.

> Within this environment it follows that a primary strategy
> for such executives is the elimination of *all*
> competition.

Fortunately the most cost effective method of eliminating all
competition is that followed by Alcoa, to deliver a
satisfactory product at the cheapest possible price.

In the cocaine market a number of organizations have
attempted to employ other methods for eliminating
competition, but here in America these methods have generally
proved not only unprofitable, but also for the most part
fatal. 

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         James A. Donald
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http://www.jim.com/jamesd/      James A. Donald

>From Jim Choate:

: Now in a free-market, by definition, there is no law. What then is the
: responsibility of businesses other than the pure unadulterated pursuit of
: profit? If this includes lying, denying consumers information, etc. what
: harm is done, they have fulfilled their responsibility to their shareholders
: (potentialy quite lucratively) and broken no law. Within this environment it
: follows that a primary strategy for such executives is the elimination of
: *all* competition. And since there is no law other than the measure of profit
: all can be justified.
................................................................................


There might be no Law.   But there would still be Reality  -  and for some people, this is *much*
harder to deal with.

If customers sit around like lumps on a log depending upon the kindness of strangers, well they're
not doing themselves any favors.  But such a person is not a customer.  They are an invalid (or will
be, eventually).

In a free-market economy, everybody - not only corporations, not only customers - have to be
rational about what they're doing.   Everybody has to "be on their toes", alert to what truly is in
their interest, and prevent themselves from accepting, from supporting, self-defeating offers from
Trojans bearing spam.   You learn or you die, just like in the movies.


    ..
Blanc

On Sun, Oct 04, 1998 at 11:53:28PM -0500, Jim Choate wrote:

> Now in a free-market, by definition, there is no law. What then is the

no in a free market there is no state

there are laws based on natural rights

-- 
pgp 1024/D9C69DF9 1997/10/14 steve mynott <steve@tightrope.demon.co.uk>

    the chief value of money lies in the fact that one lives in a world
in which it is overestimated.  -- h. l. mencken

At 11:53 PM 10/4/98 -0500, Jim Choate wrote:
>Milton Friedman won the Nobel price in 1976 in economics. One of the
>questions he asked was:
>
>Do corporate executives, provided they stay within the law, have
>responsibilities in their business activities other than to make as much
>money for their stockholders as possible?
>
>His answer was 'no', they have no responsibility outside of those two
>considerations (ie the law, stockholders expectations of profit).
>
>Now in a free-market, by definition, there is no law. What then is the
>responsibility of businesses other than the pure unadulterated pursuit of
>profit? If this includes lying, denying consumers information, etc. what
>harm is done, they have fulfilled their responsibility to their shareholders
>(potentialy quite lucratively) and broken no law. Within this environment it
>follows that a primary strategy for such executives is the elimination of
>*all* competition. And since there is no law other than the measure of profit
>all can be justified.

Just because he won a Nobel prize does not mean he was correct, it means
those bestowing the prize on him agreed with him.

business/economic right vs wrong is a different game from
moral right vs wrong.

for instance, suppose there was a great demand for analog watches with
luminous dials. would it be right to flood the market with luminous dials
that were also highly radioactive, because those isotopes were less
expensive than luminous substances that were not radioactive? (this
presupposes that no rules were broken AFA selling watches with radioactive
luminous dials).

are you saying that the proper business solution is to throw public safety
to the wind, and never mind possible consequences of wrist cancer 10 or 20
years down the road? what would the companies bottom line be after the
ravages of the eventual class action suit?

Reeza!

	
"I'm desperately trying to figure out why kamikaze pilots wore helmets."
						- Dave Edison

At 11:53 PM -0500 10/4/98, Jim Choate wrote:
>Milton Friedman won the Nobel price in 1976 in economics. One of the
>questions he asked was:
>
>Do corporate executives, provided they stay within the law, have
>responsibilities in their business activities other than to make as much
>money for their stockholders as possible?
>
>His answer was 'no', they have no responsibility outside of those two
>considerations (ie the law, stockholders expectations of profit).

	The law was a very implicit assupmtion in his question.

	Take the law out of it and ask him again.

	If he gives you the same answer, he is wrong.
--
petro@playboy.com----for work related issues. I don't speak for Playboy.
petro@bounty.org-----for everthing else.      They wouldn't like that.
                                              They REALLY
Economic speech IS political speech.          wouldn't like that.

At 12:58 AM -0500 10/5/98, James A. Donald wrote:
>At 11:53 PM 10/4/98 -0500, Jim Choate wrote:
>> Now in a free-market, by definition, there is no law. What
>> then is the responsibility of businesses other than the
>> pure unadulterated pursuit of profit?
>
>None whatsoever.

	One must also draw the distinction between long term profits, and
this quarters bottom line.

	Things that positively impact this weeks bottom line (say, dumping
PCB's in the local water supply) negatively impact next year/next decades
(all your prospective customers are either dead, or have 3.5 arms, and a
distinct lisp).

>> If this includes lying, denying consumers information, etc.
>> what harm is done, they have fulfilled their responsibility
>> to their shareholders (potentialy quite lucratively)
>
>While there is a sucker born every minute, the strategy you
>describe is for the most part unlikely to be profitable.

	In the _long_ term.

>Fortunately the most cost effective method of eliminating all
>competition is that followed by Alcoa, to deliver a
>satisfactory product at the cheapest possible price.

	Funny how he never talks about that one.



--
petro@playboy.com----for work related issues. I don't speak for Playboy.
petro@bounty.org-----for everthing else.      They wouldn't like that.
                                              They REALLY
Economic speech IS political speech.          wouldn't like that.