U.S. public markets are quietly shrinking. Since the late 1990s, the number of publicly traded companies has fallen by more than half. Initial public offerings, once a reliable engine of economic dynamism that let ordinary Americans invest in tomorrow’s great companies, have plummeted.
Founders, executives and investors are doing the math and increasingly deciding that the risks of going public outweigh the rewards. Chief among those risks is a litigation environment so hostile to public companies that it has become a de facto tax on participation in America’s capital markets. It’s a situation that warrants judicial intervention.
As Securities and Exchange Commission Chairman Paul Atkins recently warned, a primary driver behind this liability risk is the explosion of securities class-action lawsuits.
Anyone who has seen “The Wolf of Wall Street” or “Boiler Room” will be familiar with pump-and-dump schemes, where insiders accumulate a company’s stock, spread pernicious rumors to inflate its value, then dump it when the truth comes out. One purpose of securities law is to compensate investors who have been wronged by such schemes. But in the past several decades, securities law has been twisted into a profit engine for lawyers manufacturing their own variation: stoking mounds of bad publicity about a company only to sue once the firm’s stock is affected.
Frequently referred to as “stock drop” lawsuits, these cases often materialize within days of a decline in a company’s market price, regardless of whether any fraud actually occurred.
Meritless securities suits have become a reliable way for trial lawyers to extract massive settlements from public companies, often with little connection to actual investor harm. In these cases, plaintiffs are not required to prove that an investor relied on or was influenced by any alleged misrepresentation or misstatement. Instead, they invoke what lawyers call the “inflation-maintenance theory” — where plaintiffs need not even show that prior false statements pumped up the stock at all, but only that it maintained an inflated stock price until the supposed truth came out through so-called corrective disclosures.
Never mind that corporate tax receipts were higher than ever in 2025 and have risen by 136 percent since 2019. The corporations with no tax liability were only following the laws that Congress has written.
The most common reason that a corporation would have no income tax liability in a given year is that it did not make a profit. Levying an income tax against a corporation with no net income makes no sense, regardless of its size.
The companies that Warren lists, which include airlines, entertainment companies and health care companies, did make a profit last year. But they still paid no income tax because Congress, correctly, gives them the ability to deduct expenses that further economic growth.
First, they can deduct past losses against present profits. This standard practice, known as “loss carryforward,” is completely normal across the developed world. It protects businesses in more volatile industries from being taxed more harshly than those in steadier industries.
Second, when corporations reinvest their profits in building new facilities, buying new equipment or developing new technologies, the corporate tax lets them deduct that investment. The owners of the corporation never actually received that money. The corporation sent it back out the door as soon as it came in, so taxing it as income would be wrong.
John Puri writes sensibly about the “New Right’s” infatuation with Viktor Orbán. A slice:
Large swaths of the American right — the “New Right”: nationalist-populists, post-liberals, national conservatives — were not captivated by Orbán primarily because he lent aid and comfort to America’s enemies, however (though he shares their view that Ukraine is not a cause worth fighting for). Rather, for these factions, Orbán represented a cathartic way of right-wing politics that wielded state power freely to make society behave. His government blew through the institutional constraints that frustrate impassioned partisans in America — an independent judiciary, a critical press — by dominating them. Orbán openly rewarded friends, turning the state into his personal patronage network.
Consolidating power was Orbán’s means. The end was for the state to direct, if not completely saturate, Hungarian private society. Orbán declared his mission in 2014: “The Hungarian nation is not simply a group of individuals but a community that must be organized, reinforced and in fact constructed. And so in this sense the new state that we are constructing in Hungary is an illiberal state, a non-liberal state.” Illiberal, as in unconcerned with individual rights and the government’s role in securing them. Many in the American right’s intelligentsia believe that the objective of politics here should be similarly revised.
As did Woodrow Wilson, who, like Orbán, spoke of society not as a collection of sovereign individuals to be secured but a single, organic entity to be superintended.
Justly celebrating the ousting of Viktor Orbán is Tom Palmer.
George Will rightly ridicules progressives’ “Ayatollah Itch.” A slice:
Constitutional law is clear: Freedom of speech includes freedom from compelled speech — freedom from coerced affirmations of government catechisms. Furthermore, equity “training” — meaning, invariably, indoctrination — is inherently poisonous. It also is, however, a billion-dollar business, siphoning up government and corporate money, coast to coast. The Pacific Legal Foundation, a public interest law firm that defends Americans from government overreach, and is representing [Joshua] Diemert, has more work to do.
In Illinois, the “LGBTQIA+ Equity and Inclusion” initiative sweeps far beyond compliance with nondiscrimination law, to propounding murky theories of “overlapping identities” and “micro-invalidations.” The purpose, obviously, is to extinguish viewpoint diversity.
Barry Brownstein writes insightfully about civility.
Cliff Asness tweets: (HT Scott Lincicome)
“As Asness of AQR Capital Management says, “We still don’t know if Rand’s heroes are realistic. We can debate that. But I’d say these days that the jury is in that her villains are pretty realistic.””
