This article analogizes the state, in its role as tax collector, to that of an investor, or to be more precise, that of a residual claimant on the earnings of all of the people and firms subject to the taxing power of the state. The relationship between modern democracy and its citizens would be strengthened if this analogy were more widely acknowledged because it recognizes citizen-taxpayers as contracting partners with the state. Unlike other libertarian conceptions of the state's taxing authority, (...) the framework developed here does not jeopardize the state's ability to collect the revenues it needs to provide for the protections of its citizens. The state-as-investor framework developed in this Article leads to a number of tax policy improvements. The framework suggests limits on the government's ability to change people's tax status after they have already embarked on careers and made the sunken, non-diversifiable investments in human capital that such career training requires. The framework advanced here also suggests that people should be able to make a once-in-a lifetime payment in lieu of taxes to the state in order to discharge their tax liability. This approach articulated here also seems superior to the utopian suggestion offered by Ayn Rand that taxation be voluntary, as well as to the unrealistic suggestion made by Nozick that income taxes are violative of man's natural rights. (shrink)

The way things are supposed to be : reputational theory and its demise -- Thriving the new way : with little or no reputation : the Goldman Sachs story -- The way things used to be : when reputation was critical to survival -- Individual reputation unhinged from the firm : hardly anybody goes down with the ship -- Proof in the pudding : Michael Milken, Junk Bonds, and the decline of Drexel and -- Nobody else -- The new, post-reputation (...) Wall Street : accounting firms -- The new, post-reputation Wall Street : law firms -- The new, post-reputation Wall Street : credit rating agencies -- The new, post-reputation Wall Street : stock exchanges -- The SEC and reputation -- The SEC : captured and quite happy about it -- Where we are and where we are headed : a conclusion of sorts -- Index. (shrink)

Les professeurs Macey et Miller analysent la relation entre l’assurance des dépôts et l’ inadé quation dans la structure des échéances des actifs et passifs des banques commerciales. Après avoir critiqué l’hypothèse traditionnelle concernant la réglementation, d’après laquelle les banques sont incitées à financer les actifs à long terme par des passifs à court terme parce que l’assurance des dépôts garantie par l’Etat stimule le crédit des banques et subventionne les passifs à court terme, ils utilisent l’analyse économique des décisions (...) publiques pour soutenir qu’une version modifiée de l’hypothèse de la réglementation est la meilleure explication de la déstructuration des échéances des actifs et passifs bancaires.Finalement, ils considèrent que soutenir l’hypothèse de la réglementation n’entraîne pas l’ acceptation du modèle d’assurance des dépôts garantie par l’Etat tel qu’il existe aux Etats-Unis aujourd’hui.Professors Macey and Miller explore the relationship between deposit insurance and the mismatch in the term structure of commercial banks’ assets and liabilities. After criticizing the traditional regulatory hypothesis, which posits that banks have incentives to fund long-term assets with short-term liabilities because government-sponsored deposit insurance enhances bank credit and subsidizes short-term liabilities, they use public choice theory to argue that a modified version of the regulatory hypothesis is the best explanation for the mismatch in the term structure of banks’ assets and liabilities. Finally, they argue that embracing the regulatory hypothesis does not imply acceptance of the government-sponsored deposit insurance scheme as it exists in the U.S. today. (shrink)

The Industrial Revolution caused an expansion of our ideas of property to include other forms of wealth, such as innovations and productive techniques. And the modern age has caused a further expansion of our ideas of property to include inchoate items, particularly information. The Framers of the U.S. Constitution presumed that government not only took an expansive view of the nature of property rights, they also believed that such rights should be protected. To James Madison and the other Framers, property (...) was a “broad and majestic term” that “embraces everything which may have a value to which man may attach a right.”. (shrink)

The existence of a meaningful distinction between economic rights and “other rights” has been a cornerstone of constitutional law for the past sixty years. During this period, the federal courts consistently have taken the position that Congress is free to abuse citizens’ economic liberties, but is not permitted to interfere with such other, noneconomic “rights” as freedom of expression, freedom of assembly, and freedom of religion.

In this essay, I identify the reasons that libertarian principles have failed to capture the popular imagination as an acceptable form of civil society. By the term “libertarian” I mean a belief in and commitment to a set of methods and policies that have as their common aim greater freedom under law for individuals. The term “freedom” in this context means not only a commitment to civil liberties, such as freedom of expression, but also to economic liberties, including a commitment (...) to a laissez-faire policy of free enterprise and free trade between countries. Libertarians, therefore, are committed to the absolute minimum state intervention in the economy as well as in people's private lives. In a world constrained by these libertarian principles, people should be permitted to do as they please, constrained only by rules that prevent them from encroaching on the liberty of others. (shrink)