Executing Corporations

[drplokta]

Theres a meme going round "I'll believe that corporations are people when Texas executes one". But Texas "executes" hundreds or thousands of corporations per year, most famously Enron. Bankruptcy is the exact equivalent of execution for corporations -- it's the state exerting its power and causing the corporation to cease to exist. So I guess that corporations are people.

Comments

[del-c.livejournal.com]

Why kill profitable enterprises at all? Because they aren't built like humans, we have options available to us that aren't options for human killers or thieves, outside science fiction.

For instance, mindwipe and return to society as a productive "citizen". Cancel all the shares, sack all the officers, and take the company into administration. After appointing new officers, either run the company as a state-owned enterprise or, for the less socialist among us, sell it or its fully-working autonomous parts as going concerns to new owners.

"Execution" returns only the book value of the company to the market, if the state sells off the office chairs, etc. Sale as a going concern returns both the book value and the goodwill, which, if we believe the market, was something of real worth.

[autopope.livejournal.com]

Well, for start with the pernicious doctrine (in US law) of corporate "personhood" is a huge problem. Ditch that and we can treat them as non-human entities -- without, for example, the right to political free speech (which is used as a shield for lobbying activities).

But a more serious issue is: the enterprise may be profitable, but is its continued existence beneficial to society at large? Consider the whole investment banking/subprime/CDS/CDO mess. Clearly it was beneficial to the participating organizations -- until it all collapsed in a heap -- but as far as civilization in general was concerned, it's hard to see what it produced that was of value. Again: cigarette manufacturers?

I can create lots of economic activity (and profitable activity at that!) by throwing bricks through windows (thus giving glaziers and insurance companies a lot of exercise). But that doesn't mean that doing so is good for the public commonweal. I submit that there are corporations whose business model is the equivalent of brick-throwing, i.e. it generates lots of turnover but is actively damaging to the public interest. And we don't want to turn them around and set them back up on their feet: we want to shut such activities down, permanently.

[del-c.livejournal.com]

Trying and executing corporations is the answer to a different problem than "is this sector of the economy a toxic mess?", and the answer to that problem is something other than trying and executing corporations. If a bank is a bad bank, it can be a good bank, and rehabilitation can set it on the road to being one. If an entity just shouldn't exist at all, but does thanks to the incentives in the environment, then you've changed the subject to one different from the one under discussion.

To stretch the people analogy again, you're looking at incarceration and lethal injection as if it were a good way of cleaning up a bad neighbourhood, when maybe employment and infrastructure investment would be more to the purpose.