Spot on. I’m enjoying this journey you’re leading us through very much.

Thank you so much for your visit and this wonderfully thoughtful comment.

Your quote about being ruled by tyrants is really quite relevant, because, divorced of the ability to influence - and even, for all practical purposes, to select - managers, shareholders typically do find their corporations headed by tyrants, even if they see themselves as benevolent ones.

Regarding Enron, I gather that you are talking about the tax consequences of moving a company retirement account, such as a 401k. This can be done, although the ways of doing it aren’t widely known, can be unnecessarily complex, and take time. I certainly also agree that government regulation isn’t the answer - that’s why I hope we can find a way to more effectively police ourselves.

The concern I’m trying to express isn’t that the market is risky or that people pressure politicians (or politicians sense populist opportunities) to unwisely try to legislate morality into the capitalist system. It’s that the distortions between ownership and responsibility in the anonymous shareholder system tend to punish people (owners and others) for problems created by other people (managers) who are generally divorced from responsibility for creating those problems.

That, in and of itself, of course, is one way to look at the risk of the marketplace. But that is not, I don’t think, a sufficient approach to addressing the shortcomings of our corporate governance system.

In this context, your reference to the “overarching problem” that is the reason for “people’s willing, gradual surrender of their sovereignty” is indeed a large part of the problem, here, and one I haven’t been addressing:

I’ve been criticizing boards for failing to control managers, and managers for taking advantage of the vacuum of power and responsibility, and arguing for addressing what I see as the core genesis of this problem so we can try to develop a corporate governance system to address it.

But in the anonymous shareholder system, owners are largely trying to have it both ways, also. They want to enjoy unsustainable returns, and either run away or even sue when things go south.

This is an important aspect of the overall issue - thank you so much for forcing me to see it this way! I will try to bring it into the discussion.

This was my favorite mantra several years ago, until I stumbled upon William Penn’s quote:

“Those who will not be governed by God will be ruled by tyrants.”

They’re two ways to say essentially the same thing, except the latter recognizes the necessity of a sovereign source of universal morality that the first doesn’t.

Through reason, those who prefer the first can come to the same conclusions as those who prefer the second, but I find it less likely that they will, especially as we lose our ability to reason, over time, as we have been.

I’d like to explore this comment for a moment:

“Where capitalism fails to function properly or smoothly, regulation is often required.”

Regulation is sometimes required, but altogether less than politicians think it is. The instances of broken corporate regimes aren’t examples of market failure, but of market success.

Enron, for instance, was governed poorly and is no longer in business — Not because the government got there a day late and a dollar short — but because the company was losing money, and it could not perpetually sustain itself on a myth.

Investors got savvy to this and started pulling their capital, but Enron employees were prevented from doing so — something made possible, by the way, by regulations set forth by the government pertaining to such things. Had the government allowed or even preferred a free market system, employees would have been allowed to take their money and put it wherever they wanted, whenever they wanted to do it, without even tax liability.

That such things are not allowed to happen freely without government interference shows just how reluctant the government is (and we are) to allow a free market.

I understand that people lost money, but people lose money in the market all the time. Market success doesn’t mean everyone wins. It means those who perform well are left free to succeed and those who perform poorly are left free to fail.

That we keep turning to government when we witness the natural vicissitudes of a free market (vicissitudes that, by the way, government is ill-equipped to manage) speaks, perhaps, to an overarching problem that is the real cause of the behavior that results in corporate failure as well as the people’s willing, gradual surrender of their sovereignty.