[ExI] Don't be evil

The Avantguardian avantguardian2020 at yahoo.com
Thu Mar 25 09:32:11 UTC 2010


----- Original Message ----
> From: Dan <dan_ust at yahoo.com>
> To: ExI chat list <extropy-chat at lists.extropy.org>
> Sent: Wed, March 24, 2010 1:22:57 PM
> Subject: Re: [ExI] Don't be evil
> 
> The point is, in a free society, you don't have to deal with psychopathic 
> businessmen. If you know you're not going to be bailed out at taxpayers' expense 
> (or via some other government program, such as credit expansion), then you'll 
> likely take much more care in selecting who to hand your money to.

But of course, the solution is to lobby for deregulation of banking so that you don't have to care who you hand your money to because you can do so and be governmentally insured. Since at the end of the day, you can claim it was the governments fault for deregulating you. Especially if loaning money to people who can't afford to pay it back allows a politician to point at all the money going around and say "look how good the economy is doing".

> Also, 
> the number of people who have such fortunes that they can merely flee the 
> country AND still life the high life is very small. In the long run, for such 
> people, this is a losing proposition. Surely, some will still get lucky and 
> escape, but that's true under any social system: a lucky few will get lucky. The 
> point is, though, if will lived in a free society, the problem would be far more 
> limited and self-limiting since there'd be no alternative avenue for these 
> people to get away with it.

In a free society, too, fleeing the country 
> isn't likely to solve all your problems. If you have a bad reputation and 
> everyone else knows about it, then it's going to be fairly hard for you to turn 
> up somewhere else and expect them to be duped too.
 
No need to dupe them when you can simply pay them off. There is an old saying (dating back to ancient Rome) that "money has no provenance". I think if Madoff had managed to escape to any number of countries without extradition treaty membership he would have lived like a king with his billions. And even if he *was* reviled in general, his heirs would have been far more respectable, despite their money coming from the same source. I am not suggesting this is right or proper, I am simply indulging in historically based cynicism.
 
 In my view, it's because of 
> moral hazards created by bailouts and such plus the attitude that regulation 
> works (it doesn't; it merely creates burdens for some and deludes most into 
> believing the world is safer because there's some regulation in place) that 
> people generally don't do the proper due dilegence on investments and the like. 
> It's the unintended consequences of all these policies that have led to the bad 
> outcomes.

So you think that there is no correlation between the repeal of the Glass-Steagall Act (Banking Act of 1933) in 1999 by the the Gramm–Leach–Bliley Act and the current global financial crisis?
http://en.wikipedia.org/wiki/Glass%E2%80%93Steagall_Act


Of course, some of the policies probably don't intend to some 
> public good -- whatever that is -- but merely toward some private benefit at 
> public expense and then the policies are sold as supporting the public good. The 
> recent wave of bank and auto bailouts were all of this sort. The public was not 
> really helped in any way. Just some big executives and investors got to 
> redistribute their losses to everyone else. Some have even pointed out, since 
> this happens time and again, that the nature of all such regulations and 
> policies is merely to insure the elites always win out, regardless of the fact 
> that this causes periodic financial crises.
 
Well then it seems a win-win situation for the elites. Win with deregulation and win with regulation. Of course the two can be be conflated when one passes legislation to deregulate something. I suppose that's why they are called elites.

I expect after everything 
> calms down, in a few years, and all the new regulations are in place, we'll have 
> another crisis and this will again be blamed on free markets, more regulations 
> will be proposed, and the cycle will repeat. This does seem to be the nature of 
> things in this area and it's rare in history where the alternative course is 
> taken -- that of actually not bailing big investors, big banks, and big firms 
> out and that of allowing them just to fail... It's rare, but not unheard of. In 
> fact, the Panic of 1819 seems to have been a case of just that: the central bank 
> inflated, some people got really wealthy, then the whole thing collapsed and the 
> government did almost nothing to help them -- no bailouts, no new regulations, 
> though there was some delay of debt payment. The world didn't end, but quite a 
> few fat cats lost their fortunes.

But titanosaurus was too big to fail!
 
Stuart LaForge 


"What is true by lamplight is not always true by sunlight." - Joseph Joubert



      





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