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The guy you replied to is literally just reciting the actual historical circumstances that lewd to governments permitting arbitrary corporations, a relatively r

The guy you replied to is literally just reciting the actual historical circumstances that lewd to governments permitting arbitrary corporations, a relatively recent development in the west over the last 400 years. Read up some history. Originally only the government could form a corporation by a special act of the king or later parliament or congress, as it was seen as such a powerful and special thing that couldn't just be handed out willy nilly. What you are reciting is merely modern ideology that supports the status quo. Forcing investors to take on liability is neither just not unjust, merely different ways of running societies, equally valid depending on your goals. After all nobody makes you invest, and in a society where you might be liable for your investment's actions you would be much more scrutinizing about your management's character before agreeing to involve yourself. Ventures would tend to be more personal and require more trust. That's the world we used to live in and that was just as valid and just. Read history.

voisin 3y ago
As a trained (but not practicing) lawyer who focused my education on corporate and tax law, I have read history from the source either directly or indirectly in nearly every course I took. I have not, in any of my education, come across the notion that (as OP was responding to) corporations were allowed due to a belief they would increase the net utility of society (or specifically in this case, that decreased Netflix hours watched would be a net utility objective that would’ve been in the realm of things a corporation was initially intended to be formed for). The reasons for corporations to spread beyond royal charter to arbitrary creation by the general public had to do with lawsuit administration and limiting liability. Prior to corporations, partnerships were the primary form of organizing and when they were sued each partner had to be included separately which was cumbersome and many partners had nothing to do with the operations or activities that gave rise to the liability. The legislation which codified the above is credited with a massive increase in company formation and capital allocation in the 1800s. The presumption being that things that were once deemed too risky when there was unlimited liability were no longer as risky. None of what I’ve written here is “modern ideology” unless by modern you refer to the 1800s.
- galdosdi 3y ago
  OK, then why was it that for so long a new joint stock company's creation required a charter from the monarch or parliament, etc, and not just anybody could get it (as today)? It was obviously seen as a valuable and scarce privilege, not a right. Choosing to bestow that privilege to anyone for any purpose they wish is a conscious tradeoff that our society makes, nothing natural about it. The upside as you keep mentioning is it's convenient to run the enterprise this way, allowing it to reach a larger scale. The downside to society is the risk that this greater power enables the creation of organizations that rival the state in power -- which is probably why originally, charters specified a limited purpose for the company. See https://en.wikipedia.org/wiki/Joint-stock_company https://en.wikipedia.org/wiki/Joint-stock_company

voisin 3y ago

As a trained (but not practicing) lawyer who focused my education on corporate and tax law, I have read history from the source either directly or indirectly in nearly every course I took. I have not, in any of my education, come across the notion that (as OP was responding to) corporations were allowed due to a belief they would increase the net utility of society (or specifically in this case, that decreased Netflix hours watched would be a net utility objective that would’ve been in the realm of things a corporation was initially intended to be formed for). The reasons for corporations to spread beyond royal charter to arbitrary creation by the general public had to do with lawsuit administration and limiting liability. Prior to corporations, partnerships were the primary form of organizing and when they were sued each partner had to be included separately which was cumbersome and many partners had nothing to do with the operations or activities that gave rise to the liability. The legislation which codified the above is credited with a massive increase in company formation and capital allocation in the 1800s. The presumption being that things that were once deemed too risky when there was unlimited liability were no longer as risky. None of what I’ve written here is “modern ideology” unless by modern you refer to the 1800s.

galdosdi 3y ago
OK, then why was it that for so long a new joint stock company's creation required a charter from the monarch or parliament, etc, and not just anybody could get it (as today)? It was obviously seen as a valuable and scarce privilege, not a right. Choosing to bestow that privilege to anyone for any purpose they wish is a conscious tradeoff that our society makes, nothing natural about it. The upside as you keep mentioning is it's convenient to run the enterprise this way, allowing it to reach a larger scale. The downside to society is the risk that this greater power enables the creation of organizations that rival the state in power -- which is probably why originally, charters specified a limited purpose for the company. See https://en.wikipedia.org/wiki/Joint-stock_company https://en.wikipedia.org/wiki/Joint-stock_company