Blank check

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This article is about the metaphor. For the 1994 film, see Blank Check (film). For the short lived '70s game show, see Blank Check (game show).

A blank check (carte blanche), in the literal sense, is a check that has no numerical value written in, but is still signed. In the figurative or metaphoric sense it is used in politics to describe legislation that is open-ended or vague, and could be easily subjected to abuse.

Contents

1 Literal meaning
2 Metaphoric meaning
3 In literature
4 Blank check company
5 See also

Literal meaning

Check owners are normally advised to specify the amount before signing. If created accidentially, such checks can be extremely dangerous for their owner, for whoever obtains the check could write in whatever amount of money he or she wanted, and would legally be able to cash it (to the extent that the underlying account contains such funds). The 1994 film Blank Check plays on such a situation.

Metaphoric meaning

The metaphor of the "blank check" is thus often used in politics. For example, in the US the Gulf of Tonkin Resolution has been called a "blank check," for it gave the President the power to "take all necessary measures" to prevent "aggression" in Southeast Asia. These powers were then used to escalate the Vietnam War. Many in the Congress protested, but were helpless to do so, for the Tonkin resolution's terms were too subjective to enforce.

This term was also used to describe how the Kaiser of Germany told Austria-Hungary officials they could deal with Serbia however they wanted after Serbian Nationalists assassinated the heir to the throne of Austria-Hungary, Archduke Franz Ferdinand. This was immediately preceding World War I.

It may also be used in service fields. Customers may tell a company to treat the project as their own, which in essence is carte blanche. (To the extent the service meets normal expectations.)

In literature

Literature's most famous carte blanche (literally 'white card') was handed out by Cardinal Richelieu in Alexandre Dumas' The Three Musketeers:

Dec. 3, 1627
It is by my order and for the good of the state that the bearer of this has done what he has done.
Richelieu

or in French:

3 décembre 1627.
C'est par mon ordre et pour le bien de l'Etat que le porteur du présent a fait ce qu'il a fait.
Richelieu.

Blank check company

In economics, the term blank check company can refer to a company in development that has no specific business plan yet.

However, the term usually applies to a shell company with little or no employees, little or no physical assets, and no products whose business plan is to merge with or acquire some unidentified company or companies. (For example: [Fortress America])

These very small companies typically involve speculative investments and often fall within the U.S. Securities and Exchange Commission’s definition of penny stocks or are considered [microcap stocks].

In the United States, the Securities Act of 1933 (under Rule 419) requires blank check companies disclose the terms and conditions of their offering as well as place any funds received from the offering into an escrow account.

References

http://www.sec.gov/answers/blankcheck.htm

http://www.investopedia.com/terms/b/blankcheckcompany.asp

Blank check

Literal meaning

Metaphoric meaning

In literature

Blank check company

See also