The End of Contract

Contract is one of the pillars of free enterprise. Free enterprise is the means to wealth that keeps our people strong and free. Only a free people can choose virtue.

But contract is eroding.

Tenants in shopping malls in Arizona put keys in the mail to owners in Montana and say they quit. Contract out the window. Tenants in Nevada quit paying rent but stay in business, in their shopping malls. Landlords have no leverage. There is no value in evicting them. No other business is ready to take the space.

The landlord gets a call from the bank. Where is the payment? The landlord pleads poverty, no money to make the payment. The landlord and bank renegotiate a new payment schedule, interest rate and terms. The original contract is nullified.

Manfacturers in Montana negotiate lower rent. This nullifies ther contract.

City workers are asked to take a pay cut. State workers in California get furloughed, their contract nonetheless. Teachers in Montana are asked to forego the three percent raise in their contract. AIG and Fannie May and Freddie Mac executives have their contractual bonuses axed.

All contracts seem to be subject to cash flow verities. This gives little basis for the contracting parties to plan. This is a worrisome trend.

Without property rights, free expression, markets and contracts, we’re sunk.

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