Saturday, January 02, 2010

Hayek's Critical Information---Where did it go; the Good Lord only knows

No matter How it may have turned out, one can expect that Cable subscribers will have been screwed; those expected to Pay are never let in on the negotiation until the bills reflect upon our Credit Card statements. I myself am in favor of a per-View fee for programming, and believe that IPOs should be compelled to pay an equal fee for maintained Web sites; all to help defray the Costs of maintaining the Site with some Return to the authors. The sadness resides in the equal insistence that the Consumer Protection Agency should demand that all such rates should be publicized. One cannot rely on a market model that depends on essential information being hidden from the primary Participants within the market. The sad Truth today states that every area which should be regulated is not, and every area which should be freed from regulation are not; all for the benefit of Business, at the cost to the Consumer of massive mis-structure of the markets.

This article will explain that Consumers are not the only victims of hidden information, which should be within Public view. Courts has even ruled that Corporations do not have to reveal how much they have paid their own Executives to Stockholders. There is no American law demanding that Corporations pay out a certain percentage of Profits as Dividends, or even that Corporations must be truthful about the Cash reserves which they have on hand. Developing nations pay out a high level of Return on investments, simply because they need to attract Investors. American Corporations have an easy and ready wash of Cash, and Dividend payments have dropped accordingly; especially in the absence of regulation requiring publication of information. Understand full well that Dividend levels are determined precisely by Corporate Management, not available funds on hand; but Corporate bonuses continue to grow at fantastic rates.

We can find another example of Courts protecting Corporate management from information disclosure to Stockholders. Bribes to arms brokers equaled more that the Dividends paid to Stockholders, and bonuses to Executives were almost as great as the Bribes. Both the lower court, and the Appeals court, ruled that the international corporation did not have to respond to American law against bribery, yet a great share of the money spent in the bribery came from American Stockholders’ pockets. It is interesting that much of the Stockholder contentions concerned operations funneled through the defunct Riggs bank, long known for it’s Drug money laundering, and other criminal activities. Why is it that Criminals always seem to get a break in American courts, while the victims of Crime are ignored? lgl

No comments: