Abolish the Corporations?

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LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: BoomerD
Originally posted by: LegendKiller
Who are corporations owned by? I guess all of those funds like Calpers, mutual funds, 401ks and pension funds are just for rich people.


What the hell does that have to do with the subject? Corporations have only one interest...profit...for themselves, their executives, and their shareholders. They use their extensive wealth to lobby for changes in the law that are beneficial to them, usually to the detriment of working people...creating a whole new class of "people"...
poor, middle-class, rich, and corporations. Our government is elected by "the people" bt controlled by the monied corporations. as if to give us the illusion of having something to say in how our government is actually run.

And that profit seeking directly benefits the people, does it not? Do individuals not benefit when a company profits? Who owns the company? If GM lobbies for more benefits, does the workers not benefit? Do shareholders not benefit? The millions of shareholders? The people who invest in the mutual funds, pension funds, 401k, and everything else?

People think that corporations are some rich-only benefit the rich.
 

BoomerD

No Lifer
Feb 26, 2006
66,423
14,829
146
Yet oddly enough, when a corporation LOSES billions of $$$ annually, the CEO's all get HUGE compensation packages, but call for the rank-and-file working people to take the brunt of the cuts to try to turn things around. (Ford comes to mind quickly) They lost something like $16 Billion last year, yet their CEO (McMully?) got a $39 Million dollar package...and they then closed several plants to try to improve their cash flow.
Corporations are all about making the corporation more money. If they have to pay their workers a bit more to keep them productive, if they have to dribble out some dividends to their minority share holders, they will, but only because they have to...
Do I think all corporations are evil? NO, but many are pretty unscrupulous in how they do business.
 

Orsorum

Lifer
Dec 26, 2001
27,631
5
81
Originally posted by: Whoozyerdaddy
Originally posted by: Craig234

What you fail to grasp is that a corporation can't be put in jail, a corporation doesn't have to eat so it doesn't matter if it goes broke, if the owners don't.

But the people who run them can go to jail. Skilling, Waksal, the Rigas family, Kozlowski, Ebbers, etc, etc, etc...

People are held accountable for the actions of the corporation. This notion that corps and the people who run them are above the law is stupid. The corps themselves can he fined, forced to pay restitution and restricted from certain activites as well. You can't put an artificial person in jail but that doesn't mean you can't punish them.

It's not just stupid, it's flat out ignorant. There are numerous mechanisms for controlling corporate behavior, both with punishment meted out to the legal entity itself and to those management and BOD personnel who are responsible for the behavior. In addition, management, directors, and shareholders can be held responsible financially if their actions give cause to pierce the corporate veil.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: BoomerD
Yet oddly enough, when a corporation LOSES billions of $$$ annually, the CEO's all get HUGE compensation packages, but call for the rank-and-file working people to take the brunt of the cuts to try to turn things around. (Ford comes to mind quickly) They lost something like $16 Billion last year, yet their CEO (McMully?) got a $39 Million dollar package...and they then closed several plants to try to improve their cash flow.
Corporations are all about making the corporation more money. If they have to pay their workers a bit more to keep them productive, if they have to dribble out some dividends to their minority share holders, they will, but only because they have to...
Do I think all corporations are evil? NO, but many are pretty unscrupulous in how they do business.

I am not saying it's all correct. McNulty's compensation is not just set on current F performance, but also future performance. It's paid in options, cash, and restricted stock (which is a great long-term motivator). The 16Bn loss was mostly costs they had to reserve for the funding of the restructuring, since it's an automatic liability as soon as you *know* you will incur a cost. That liability was recognized immediately and was counted as a loss to equity investors.

The closing of plants would have occurred whether McNulty had made as much as he did or not. It's inevitable that F has to downsize, it can't produce fewer cars and keep the same workforce. It has to restructure, streamline, and offer products at a competitive price point that people want to buy. It can't do that being clogged with billions in ongoing expenses that do not make sense for the company.

I am the last person to accept high CEO pay, since if you look, many posts of mine rail against it. I abhor the idea that one man is worth so much, especially when they screw companies up long-term. Look at HD's Nardelli, he's created a massive hairball at HD, especially with his stupid acquisitions for HD Supply. I have a friend who worked at Hughes Supply. They were bought last year, only to now have 50% staff reductions and their whole company screwed up.

However, what if McNulty turns F around like he was involved in the turn around of Boeing? Then what will you say? Will you give him any credit for that up-front loss of 16bn, his pay package, and his turn around?

What about Boeing now? Do you give them any credit? What about dozens of other companies and CEOs who took a bath in the short-term, but created massive amounts of wealth in the long-term?

So quick to point out every down-side issue, but not so quick to point out the upside.
 

Dissipate

Diamond Member
Jan 17, 2004
6,815
0
0
Corporations are quasi-public entities, so yes, they are not representative of true capitalism.
 

sandorski

No Lifer
Oct 10, 1999
70,808
6,362
126
Socialist? Capitalist? Does it really matter?

The better question is: Are they beneficial?

Like Harvey pointed out, they allow certain things that a Privately held Company often can not. There are certain Goods and Technologies of such complexity that they require very large organizations and Capital in order to exist. Sure, we could wait for some Mom and Pop business to grow naturally to the size required, but even then the complexity of current Technologies require many independent inputs. Corporations accelerate the process greatly by allowing many to pool their Wealth together and in a short period of time establish an organization capable of very complex things..
 

Craig234

Lifer
May 1, 2006
38,548
350
126
Originally posted by: Orsorum
Originally posted by: Whoozyerdaddy
Originally posted by: Craig234

What you fail to grasp is that a corporation can't be put in jail, a corporation doesn't have to eat so it doesn't matter if it goes broke, if the owners don't.

But the people who run them can go to jail. Skilling, Waksal, the Rigas family, Kozlowski, Ebbers, etc, etc, etc...

People are held accountable for the actions of the corporation. This notion that corps and the people who run them are above the law is stupid. The corps themselves can he fined, forced to pay restitution and restricted from certain activites as well. You can't put an artificial person in jail but that doesn't mean you can't punish them.

It's not just stupid, it's flat out ignorant. There are numerous mechanisms for controlling corporate behavior, both with punishment meted out to the legal entity itself and to those management and BOD personnel who are responsible for the behavior. In addition, management, directors, and shareholders can be held responsible financially if their actions give cause to pierce the corporate veil.

If by "flat out ignorant", you mean true and important, you are right. You are the one with the ignorance as displayed in your lack of reading comprehension.

Your response argues that there are *some* measures available, and *some* access to jail for management.

Had you read my post and not misread it, you would see that you don't contradict it, that it doesn't say what you claim it says: it leaves *some* punishments, *some* jail for management. What it actually discusses is the issue of *reduced* accountability, how the idea of a corporation as a person is absurd, including the fact that a real person can be put in jail for wrongdoing while a corporation can't; if the threat of jail had a 100% carryover from the corporation to its management, ok, but it doesn't, it's reduced.

This is why you see again and again corporations convicted of felonies while no real person has any felony conviction on their record as a result.

Once again in this thread, as usual the liberals supply the water to the right-wing, and the right-wing pees in it instead of drinking.

Fern:
I thought you libs didn't like the idea of putting people in jail anyway?

While I think that jails are overused and I'd like to see improved options, including better rehabilitation, I'm sure as hell not iin favor of just getting rid of jails now.

The facts that there is now a big profit motive in jails for the jailers who charge the taxpayers and lobby for more prisoners, and that the public has a foolishly shortsighed view in how to run jails on the 'penny wise pound foolish' basis without almost any rehabilitation, don't mean that I want someone who rapes, robs, kills, etc. to be given a note saying not to do it again and let go. We need deterrents - and we also need drug treatment, job training, and other rehabilitative measures.

You then went on to confuse what I actually said about the origin of corporate PERSONHOOD, with corporate CHARTERS:

So, corporations were intially authorized by US law then State law.

Yes, while the nature of corporations has changed hugely in the last 125 years than before that time, corporations themselves have long been legally established, since Queen Victoria made the first global corporation, the source of our primary cause for the revolution, the East India Trading Company (and did things that'd make today's liberals howl - imagine if the Bush administration officials were the primary owners of the biggest corporations and passing tax laws that exempted their corporations).

My comments were about the history of the legal status of corporations as persons - the book I named explains this very well, and I'd ask you to read it.
 

Infohawk

Lifer
Jan 12, 2002
17,844
1
0
Yes, corporations are complete fabrications of the state. The departments of state of the separate states generally oversee their formation and status which shows you their true nature. As such they are not truly compatible with pure libertarianism / pure free-markets.

I'd love to see a test free-market economy with no corporations. I suspect one would see more franchise-like partnerships and more smaller businesses. Markets existed long before corporations were concocted.

PS Techs, it doesn't sound like most people in this thread understand your point. I'm not sure why. Maybe it's the knee-jerk reaction to link corporations with free markets?

 

rchiu

Diamond Member
Jun 8, 2002
3,846
0
0
Originally posted by: Infohawk
Yes, corporations are complete fabrications of the state. The departments of state of the separate states generally oversee their formation and status which shows you their true nature. As such they are not truly compatible with pure libertarianism / pure free-markets.

I'd love to see a test free-market economy with no corporations. I suspect one would see more franchise-like partnerships and more smaller businesses. Markets existed long before corporations were concocted.

PS Techs, it doesn't sound like most people in this thread understand your point. I'm not sure why. Maybe it's the knee-jerk reaction to link corporations with free markets?

So let me get this straight, on one hand, you are complaining there are no rules and regulation for investors and corporations, and on the other hand, you want a complete free market with totally no rules and regulation for the business activities.

Yeap, I guess that's the reason I don't understand your point.....
 

Fern

Elite Member
Sep 30, 2003
26,907
174
106
Originally posted by: Infohawk


PS Techs, it doesn't sound like most people in this thread understand your point. I'm not sure why. Maybe it's the knee-jerk reaction to link corporations with free markets?

I think it mostly stems from his refusal, or inability, or oversight in failing to provide his (even very informal) definition of "socialism". I glanced at Wiki beofre intially posting and there several varients. Which one is he thinking of?

I'm pretty sure no matter which one is chosen, there are likely more differences of a substantial nature (even if subjective) than similarities (likely of esoterical nature).

Whatever it may be, I do hope it trancends the idea that mere collective (2 or more people) effort = socialism. At that level almost all activity could be defined a socialism.

Fern
 

Vic

Elite Member
Jun 12, 2001
50,422
14,337
136
Originally posted by: techs
People, you are missing my point. A Corporation is a government created and controlled economic entity with different rules than those of Capitialism in order meet a State desired end.
Therefore Corporations are a Socialist entity.

It's true that, due to its government charter, a corporation is not a capitalist entity in the truest sense (and I have argued this here many times in the past BTW), but they're not socialist either. You and Craig234 are more than a wee bit confused on this point.

The problem with modern corporations is the legal concept of the "juristic person" (commonly referred to as "corporate citizens") whereby corporations in the US were granted 14th Amendment rights as persons by the dubious precedent of the Santa Clara County v. Southern Pacific Railroad decision. I think that it is this unfortunate mistake that techs is confusing to be socialism. This is not socialism, as ownership of the corporations rests in private rather than public hands, but it is a form of economic favoritism granted to a quasi-public organization that is representative of fascism.
The obvious solution (although good luck getting it done!) is to reverse this decision and revoke the jurisitic person rights. Then corporations will go back to being what they were in the US before the Civil War, namely institutions for pooling capital.
 

TheAdvocate

Platinum Member
Mar 7, 2005
2,561
7
81
A corporation is a legal fiction. A corporation, by definition, is amoral and is only concerned with generating profits.

The fiction was created in order to protect the assets of passive investors, most of whom were wealthy and lobbied for the fiction. It's not a ridiculous idea, because the burden on the apssive investor to closely follow day to day operations is great. In that way, it is a "socialist" fiction - it relieves the responsibility of the passive investor.

The problems with modern corporations are many fold. The biggest ones are:

1. Derivative action standard - requires too many shareholders to sue a company. Also too hard to remove a director or executive officer who has performed poorly.
2. Compensation committees - discussed ad nauseum on this forum - this tight circle should not be deciding compensation for their buddies and vice versa. This includes golden handshakes to retiring CEOs.
3. Legal ability to lobby - corps have the funds, the brand name, the marketing machine, and the influence to lobby on a level that no other organization enjoys. Political campaign contributions by companies should be banned. Then again, IMO, all political contributions should be banned. Free speech = our individual votes not our buying power $$$. Govt should not be for sale.
 

aka1nas

Diamond Member
Aug 30, 2001
4,335
1
0
Originally posted by: techs


Perhaps it will help for you to think of it this way. Its a Socialist idea for the State to create an artificial type of business entity with different rules than than the free market.
Therefore Corporations are a Socialist entity.

Only if you take the absurd position that any time the government does ANYTHING it's socialism in action.