That's not how the majority of corporations exist today, nor reflects how most people believe they should operate. It's the behavior of a small percentage of large corporations, largely supported by people like you throwing their hands up and going "well, that's just the way of it!"
Expecting corporations to behave ethically is no different than expecting people to behave ethically -- and we should do the same thing about both situations, establish rules and police them. It's nothing at all like termites and wood: it's a voluntary choice made by people, not a biological imperative from an unthinking creature.
It's the policing that has collapsed, because people like you have bought the propaganda that we should accept and normalize such behavior from corportations.
I think you're deeply misunderstanding my position.
I don't think we should accept and normalize this behavior from corporations, I think we should reject corporations as valid entities with a right to exist entirely.
Expecting corporations to behave ethically is not a reasonable expectation. Unlike individual humans, corporations only have incentives to make money.
I think policing is necessary, but it won't ever work as long as we treat corporations as capable of ethics. It should be assumed that corporations will do the wrong thing the instant it becomes profitable. Corporations should be considered guilty until proven innocent.
Im sorry, but your position just sounds like uninformed radicalism.
Most corporations manage to act ethically; corporations (big and small) have non-profit motives; and limited liability is pretty much required to have a functional economy.
Your arguments are largely about scale, locality, and control structure, and nothing about corporations per se.
> Im sorry, but your position just sounds like uninformed radicalism.
Don't be sorry for labeling my position, just don't do it. If you had a defensible position you could defend it without name calling.
> Most corporations manage to act ethically;
Inasmuch as it is profitable to do so, sure. It rarely remains profitable to do so, however.
Could you point out some examples of successful corporations acting ethically when it was not profitable to do so?
> corporations (big and small) have non-profit motives
Examples?
> and limited liability is pretty much required to have a functional economy.
Is it? Iceland put their bankers in jail and recovered more quickly from the subprime mortgage crisis than anyone. Limited liability allows economies to function for the rich, but that's a rather narrow view of functioning. The stock market is not the economy.
You cannot support policing and limited liability--limited liability means that policing has no teeth.
I labeled it as seeming such because I was hoping you'd elaborate, rather than baldly assert what are radical positions.
Before I answer your question, could you define what you mean by successful? I know that sounds facetious, but I mean it seriously -- most people mean, say, Walmart when I would consider a profitable local grocer to be successful, even without growth.
Examples of not-profit driven corporations would be any of the not-for-profit entities, for starters. Then you can get in to social purpose corps, c-corps where the shareholders focus on structural stability and long-term value preservation, etc. It seems that you're limiting your idea of corporations to being large, traded on Wall St corporations -- which I agree are problematic. Where I think we disagree is on the solution: I prefer smaller, localized corporations while you want to abolish them entirely (which I think inflicts a great deal of collateral damage, taking the idea to a net negative).
Limited-liability is purely the notion that assets not given to or gained from the corporation aren't subject to covering its debts just because you own part of the corporation. It has nothing to do with shielding executives from fraud or criminal prosecution, nor shielding the corporation's assets from unlimited liability.
The reasom we didn't put bankers in jail (like we should have) is that they didnt want to allege multi-thousand person conspiracies and RICO act the banks. That's because the political will isn't there, and not because the bankers were shielded from liability. I think we should use RICO against a lot of corporate malfeasance -- the law is literally designed to go after the leaders of large criminal organizations and seize related assets.
I disagree, very sharply, that the notion of limited liability means policing has no teeth. We're merely too light in seizing corporate assets in repinse to damages (eg, fines are too small) and we're too reluctant to prosecute crimes from business executives. But neither of these has to do with limited liability.
I would also point out that in my experience, limited liability helps a TON of small businesses, who would shut down if the owner's entire assets were required to be at risk because of employees. Myself included: I wouldn't run a consultancy (of myself and one friend) if giving "bad" advice (in the determination of a questionably informed and often emotionally swayed jury) meant my entire life could be taken away. It's not worth the risk to specialize and trade services under that framework -- the risk from courtroom whims is too high. (I do support public directories of bonded professions, however. That gives the client a good idea of how much risk they should take on because of your decisions. The problem is this presents barriers to entry.)
Or is your position that I should only be allowed to offer my services under the aegis of a large firm which would prevent personal liability to me as an employee? That seems far worse and more classist than the present system, which offers the immunity to anyone with $200/year.
The laws exist to remove legal culpability. It's not throwing our hands up, it's recognizing the source of the problem.
Until we fix the laws, the entire point of a corporation is to diffuse legal responsibility.
Yes, it needs to change, but it can't change from the ignorant position that we're fixing leaks and will eventually have a waterproof system. It's intentionally setup to be this way and nothing short of an entire overhauling will fix it.
The profit-driven focus hinges on one interpretation of a court case, and nothing at all to do with liability shielding from corporate status.
Similarly, the punishments doled out aren't constrained by matter of law from being effective, but rather, by the dynamic of the system and the willingness of the public to accept it from judges and prosecutors.
My point was that you've been propagandized to believe that the law permits the current system, when really the present system is likely illegal already and instead results from the lack of political will to replace corrupt government officials who enable poor corporate behavior.
The system would be much better if we actually enforced it... Which you guys refuse to demand from officials, because you've bought in to the notion that what they're doing is legal.
> The system would be much better if we actually enforced it.
Right. But ...
> Which you guys refuse to demand from officials, because you've bought in to the notion that what they're doing is legal.
No. Many of us demand that but nobody listens because they know they don't have to.
Realize that making the laws unenforceable is the intent. This is what I mean by patching vs replacing. Let's say we managed to get a few hundred bankers arrested for 2008. Then what? They change the rules slightly and next time we don't.
Instead we need to repeal all limited liability for any group. That way in the future it's not us vs them, it's us vs us, which is winnable.
And I agree that's it's already illegal. But it's constitutionally illegal, we don't grant government the right to create a privileged class and yet it did. And if our ancestors were dumb enough to sign off on this, we don't have to be.
We, the people, don't have to be bound to the muck that is our common law. The government is ours to charter as we wish and if huge swaths of it aren't working they can be thrown out wholesale. If we get bogged down in trying to navigate our(!) ruleset we've already lost the game.
Limited liability for corporations isn't unconstitutional.
However, Im very interested to hear how you propose to make an economy work without limited liability.
I dont think you have anything like a plan for that, and have confused the behavior of a few large corportations with corporatioms in general, while simultaneously missing the actual social structures causing the problems you list and the benefits of corporations.
> However, Im very interested to hear how you propose to make an economy work without limited liability.
Fwiw, I'd be interested to hear how you think the current system could work if we didn't come along and bail the economy out every few years by backing these bad business debts with public money.
> corporations in general
The sole defining characteristic of a corporation is limited liability. Everything else a corporation is, is inherent it being a group of people.
Further, all benefits we enacted corporate law to provide are now handled much more directly by bankruptcy statutes and welfare. You don't have to risk everything to engage in a business anymore.
> simultaneously missing the actual social structures causing the problems you list and the benefits of corporations.
So many benefits you couldn't list them all in the space provided? You favor a system where I pay for the crimes your business commits so the burden of proof is yours.
That's not how the majority of corporations exist today, nor reflects how most people believe they should operate. It's the behavior of a small percentage of large corporations, largely supported by people like you throwing their hands up and going "well, that's just the way of it!"
Expecting corporations to behave ethically is no different than expecting people to behave ethically -- and we should do the same thing about both situations, establish rules and police them. It's nothing at all like termites and wood: it's a voluntary choice made by people, not a biological imperative from an unthinking creature.
It's the policing that has collapsed, because people like you have bought the propaganda that we should accept and normalize such behavior from corportations.