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Our governmental methods of punishment for corporations strike me as lacking. This seems similar to Wells Fargo, where ok, the company was fined, sued, made to

• BiteCode_dev 2y ago
  Companies are persons, except they are not. They cannot die. They cannot go to prison. This concept of a moral person is a totally unfair advantage that they exploit again and again.
  • quonn 2y ago
    I hear this claim a lot but is it really true? Corporations in most countries are „legal persons“ in the sense that they can act like a person. This is what limited liability is all about. In fact the very name „incorporation“ comes from giving a sort of „body“ to an entity that otherwise doesn‘t have one in order to shield the owners from liability as it should be. I do not think that a corporation is considered to be a person beyond that. It‘s merely a way to establish limited liability for shareholders which requires a mechanism for the corporation to sign contracts without an owner signing on it‘s behalf.
    • BiteCode_dev 2y ago
      They can make investments, sue, go bankrupt, have bank accounts, like a person, in their own name instead of the owner.
      • robertlagrant 2y ago
        Can you explain why that matters? Yes a company can have a bank account. A company also has a name, like a person. An age, like a person. But what does that matter?
        • oersted 2y ago
          Certain laws apply to any person, which includes companies. A company can own things like you own things, and has similar protections. A company is accountable to its promises (contracts, fraud...), like you would be, although punishments might be different. It's like a union type: `type Person = Human | Company`. Or like inheritance: `class Human(Person)`, `class Company(Person)`. Or a typeclass/trait/interface... It allows you to reuse many laws for both humans and companies, without having to specify them or define special cases every time it is mentioned.
          • robertlagrant 2y ago
            Sorry, again I don't understand why this matters.
            • oersted 2y ago
              I think the point of OP was that in many ways companies have many of the same rights and privileges as individuals, but cannot be punished in the same ways.
              • robertlagrant 2y ago
                I don't really understand that as a point, though. What would punishing a company look like? Why wouldn't we want to figure out how to punish (or hold accountable) individuals, instead of focusing on the fact that we can't punish legal entities? We can't punish countries either, even though they can also do these things. We can only punish people. So what?
                • 2y ago
  • oersted 2y ago
    Modern companies are a lot like we expect AGIs to be. It's an interesting thought that I keep coming across, I'm not sure if I necessarily agree with it. In a sense, companies are super-human intelligent autonomous beings, with much more power to act on the world than any individual. We are able to partially control them within a complex incentive and enforcement structure, but it is difficult to fully align them with what society needs. It's good news in a sense, we can control AGIs with similar systems, they have the same resource constraints as any other entity if they want to have an impact in the real world.
• MangoCoffee 2y ago
  The U.S. is not going to shut down Boeing. How many jobs would be lost if that happened, especially in this economy? The fine is quite low.
  • immibis 2y ago
    The US has propped up Boeing, because it's primarily a military contractor.
    • dralley 2y ago
      People keep saying this but it borders on conspiracy talk. The Air Force leadership has been pissed off at Boeing for well over a decade. Every project they've been given has turned into a clusterfuck even moreso than average. They fortunately had the foresight to not give them any cost-plus contracts, so at least it's Boeing eating most of the cost overruns rather than the Air Force, but the point remains that Boeing mismanagement has been a headache for the military. Politicians care about getting elected, which means they don't want layoffs on their watch. Politicians don't care what the military thinks or else they'd stop funding a lot of dumb projects that the military doesn't give a shit about - of which there are many. There are so many examples of congress putting their hand on the scale that I really don't understand the popular insistence that the military is the problem here.
      • bombcar 2y ago
        The military isn't the problem, it's that the military has no other options. Who else are they going to buy planes to bomb different-colored countries with? SpaceX? Airbus? It is to laugh. When you get a company that is too big to fail, it rests directly on the government for not identifying and solving the issue earlier.
        • zokier 2y ago
          Boeing hasn't won any major military aircraft deals in recent decades. The latest big bomber purchase, B-21, went to Northrop Grumman, as did the not so recent B-2. Fighters have been going to Lockheed (F-22 and F-35). The biggest recent win for Boeing was KC-46 tanker airplane, which is just modified 767. I suppose there is also the handful of F-15EXes that are vestige from their McDonnell Douglas merger.
• cwassert 2y ago
  Change the system. A blind focus on the concentration of wealth will only improve tech if it helps profit, will only improve lifes if it helps profit, will only protect the environment if it helps profit, will only influence politics to increase profits. It will try to create poverty because that eases exploitation. As you already hinted, the motivation has to change.
• TulliusCicero 2y ago
  You could also just send a lot of people to jail. One of the problems here is that a lot of the time, the worst thing that happens to an individual from the company is just that they get fired. That's just not a very strong deterrent when the upside if you don't get caught is potentially huge raises/promotions/bonuses. Imagine if the worst thing that could happen to you when robbing banks if you get caught is just that you can't rob banks in that area anymore. That's kind of how this works for individuals in corporations.
  • constantcrying 2y ago
    Proving something like criminal negligence is extremely hard. The supply chain of software in aerospace is extremely long and finding out who exactly was acting negligent is near impossible.
    • lupusreal 2y ago
      The supply chain is long but it's supposed to have exceptionally detailed documentation. Follow that document trail and start prosecuting people when those documents start turning sour, because not documenting the work properly is a crime in itself. This won't be sufficient to fix Boeing, but it would be a start.
    • onli 2y ago
      > When people say I changed the culture of Boeing, that was the intent, so that it’s run like a business rather than a great engineering firm. Yeah, hard to prove.
      • constantcrying 2y ago
        Stonecipher was CEO nearly 20 years ago. Are you proposing to put someone in jail for crimes which happened over a decade after he left the company. Someone which has certainly ZERO knowledge of anything related to the MAX? It is not illegal to be a bad CEO.
        • 2y ago
• constantcrying 2y ago
  The problem is that finding the people responsible can be extremely hard, so you have to go against the corporation itself. Punishing a corporation is easy, but the government hates doing it for obvious reasons. It means ruining something which is useful to you and punishing tens of thousands of completely innocent people, with inevitable layoffs. What Boeing really needs is a complete change in management culture, as that was the real root cause for the MAX disasters, but that is impossible to enforce, you can't even really verify that it has happened. I also think people don't understand how extremely lucky Boeing is. If all of this had happened during a time of low demand the company would be facing a far more dire situation, likely with many major airlines canceling orders. But since airplane demand is very high and order books are full, airlines have to keep their orders at Boeing if they want new planes.
  • lordnacho 2y ago
    Why can't the government mandate a board replacement? The board can figure out for themselves who is responsible, I would guess the finger would typically point at the CEO.
    • davedx 2y ago
      Boards are often toothless though, just look at Tesla's. Replace the C-suite. This is done frequently in M&A's and other corporate strategies in extremis. Fire the guys at the top and replace them with people with good track records.
      • ryandrake 2y ago
        You can rotate people in and out of the C-suite, but incentives and culture aren’t going to change. These people are largely figureheads that get paid a lot of money because they are Ivy Leaguers whose friends on company boards who set their salaries are all Ivy Leaguers, too. It’s not like Boeing is going to get a new CEO and then suddenly middle management is going to start prioritizing safety, engineering rigor, and risk management over profit.
• iSnow 2y ago
  You have to get the leadership by the balls. The CEO isn't going to change a company's culture alone, but she has leverage and connections. If they know they face prison if the company plays foul in a major way, they will put pressure on their deputies to change culture. Also, fines that go up to say 10% of global revenue. That ensures that even activist shareholders take note and do not pressure the CEO to cut corners.
  • constantcrying 2y ago
    >If they know they face prison if the company plays foul in a major way, they will put pressure on their deputies to change culture. It is completely ridiculous to criminally prosecute leadership for crimes which happened without their knowing/consent/acknowledgment. It would be a perversion of justice to jail someone because many levels down someone else committed a crime. The best corporate culture does not prevent criminality.
    • cycomanic 2y ago
      Well what are the ridiculously high salaries for if they don't even take responsibility. I mean parents are liable for their children, so why should a CEO not be made responsible for the culture of the corporation underneath them?
      • lupusreal 2y ago
        Parents are generally not criminally liable for the crimes their kids commit. They might catch some related negligence charges or something, but if little Jimmy decides to rob a 7-11 his mom doesn't get sent to prison for armed robbery.
        • krisoft 2y ago
          The way i see it (and here I describe how I think the law should work, not how it works): If a Boeing engineer has a breakdown and robs a 7-11, the C suite of Boeing is not responsible for that. If the Boeing engineer murders people in their course of duty because of the incentive structure set up by the C suite then they are responsible for that. How do you prove that? The same way how you prove anything. Lots of discovery which reveals concrete evidence of the C suite setting up and maintaining said incentive structure and then the prosecutorial team describing the connection to a jurry of their peers. It is the difference between little Jimmy deciding to rob a 7-11 because they are dumb as a rock, vs doing the same because they grown up in an organised crime family.
• lobochrome 2y ago
  Wells Fargo’s balance sheet was also capped which led to massive shareholder losses arguably.
• ekianjo 2y ago
  jail time for CEO would be a start?
• atoav 2y ago
  This won't change if the buck can stop with a non-human legal entity. The people who are incentivized to make actively harmful decisions like these need to also carry personal risk for endangering human life. Otherwise it is a decision where the manager who decides to stretch the limits will get praise and cash if it works out, without carrying much or any personal risk — even if they are fined or fired, chances are they already got their share. If we want such things from happening the people taking these gambles need to be painfully aware that it might land them in prison for a long time, and fines need to be proportional to the money earned — that means higher by a magnitude or more so there is not even a doubt that it won't pay off. I like to live in a society where people building critical infrastructure go to prison if they are willingly taking shortcuts.
• akira2501 2y ago
  > You have to dismantle a company before it changes these kinds of deep-rooted issues? We used to have a law that two different types of banking institutions could not be owned and housed inside the same entity. So, effectively, and based on history, yes. You absolutely do need to do that. > That is hard to achieve. Not particularly. Congress has broad and sweeping powers. They just don't use them. > Who's going to change the evaluation procedures that HR has in place to measure what rating or bonus you get this year? These are publicly traded companies. In the case of Boeing, more than half is owned by institutions and not individuals, and these institutions are known to have questionable practices in all sorts of industries. Again, the solution seems annoyingly simple.
• energy123 2y ago
  Just design the incentives so they want to fix themselves. Jail time etc.
• BartjeD 2y ago
  For spilling a hot coffee cup you get $ 2.7 million worth of punitive damages. But for killing more than 200 people and trying to hide the evidence, we'll charge you 200 million and call it a day. That's less per person than the price of a hot-coffee spill.
  • elsjaako 2y ago
    They didn't actually get those damages. To quote wikipedia: > In addition, they awarded her $2.7 million in punitive damages. [...] The judge reduced punitive damages to $480,000, three times the compensatory amount, for a total of $640,000. The decision was appealed by both McDonald's and Liebeck in December 1994, but the parties settled out of court for an undisclosed amount.
  • esprehn 2y ago
    While I understand the spirit of what you're saying it does the woman a disservice to talk about it as being only spilling a cup of hot coffee. She was severely burned and required substantial medical treatment: """ Liebeck went into shock and was taken to an emergency room at a hospital. She suffered third-degree burns on six percent of her skin and lesser burns over sixteen percent.[14][13] She remained in the hospital for eight days while she underwent skin grafting. During this period, Liebeck lost 20 pounds (9.1 kg), nearly 20 percent of her body weight, reducing her to 83 pounds (38 kg). After the hospital stay, Liebeck needed care for three weeks, which was provided by her daughter.[15] Liebeck suffered permanent disfigurement after the incident and was partially disabled for two years.[16][17] """ https://en.m.wikipedia.org/wiki/Liebeck_v._McDonald%27s_Restaurants https://en.m.wikipedia.org/wiki/Liebeck_v._McDonald%27s_Rest...
• black_13 2y ago
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• hibikir 2y ago
  Most corporations end up building systems that spread responsibility and make it very difficult for anyone to believe they can say no to things they disagree with. How many decisions are supposed to be made by groups where nobody can claim actual responsibility? Commitments that are supposedly made by a team, but where it's clear to the team they have to say yes? People get very nervous, and reviews tend to suffer, when you just ask for dodgy work orders in writing. Remembered the whole idea of the Toyota model, where everyone can theoretically stop the line? We often build systems that guarantee the opposite. Regulating decision making in companies, however, as to make sure people have to look at their own personal risk when bad things are on the line is going to get a lot of pushback, precisely because that's very inconvenient. But without something like this, the Wells Fargo situation is the natural outcome that will keep repeating.
  • Varqu 2y ago
    How about we put responsibility on the CEOs and other C-levels? When it comes to justifying the compensation packages, they are first to claim that they are responsible for the company achievements. If they would actually face jail-time for non-disputable wrongdoing, then it would actually balance it out.
  • virtue3 2y ago
    Toyota also failed miserably with the unintended accelerator pedals. And basically pulled some of the same stunts with denial and cover ups and blaming everyone but themselves (legally you have to do this I suppose). So I don't think they're a great example of having excellent QA everywhere. And kind of helps with your point of if the ORG and the division of that org is really thinking about quality and what they ship then it carries through. But that might not be the case for every part of the company (I.E. Boeing) Turned out to be extremely bad code and some potential mechanical issues from what I understand[1] [1] https://users.ece.cmu.edu/~koopman/pubs/koopman14_toyota_ua_slides.pdf https://users.ece.cmu.edu/~koopman/pubs/koopman14_toyota_ua_...
• kumarvvr 2y ago
  Corporations understand and fear only 2 things. Money. Control. Either the fine should be high enough to alert investors and ensure that they make the company change its ways.. Or The govt. should provisionally or in a timebound manner take a seat or two on the board. Let the govt. Do this for a few companies, and every otger company will fall in line. Corporations must be treated as children of the country they are born in. Sure, they become big, earn money for the govt. and are essentially independent. But if the kid goes naughty, a watchful eye and a rap on the knuckles is how you teach manners.
  • tempaway4512641 2y ago
    how you teach manners You can't teach a corporation manners. If you are going to talk about corporations as if they are people (and legally they want us to treat them as people) then you have to face that they are, technically speaking, artificial psychopaths (incapacity to experience guilt, failure to conform to social norms and respect the law, reckless disregard for the safety of others, deceitfulness in pursuit of profit, etc). Very powerful, immortal, artificial psychopaths.
• sumedh 2y ago
  > You have to dismantle a company before it changes these kinds of deep-rooted issues? When you dismantle a company, people lose jobs, that does not look good on TV for politicians.
  • isolli 2y ago
    Wipe out existing shareholders and sell fresh shares on the open market. Nothing else needs to change.
    • perilunar 2y ago
      I think you'd probably want to replace the board and the top management also.
    • its_ethan 2y ago
      Who will buy those fresh shares, knowing that they could be "wiped out" by the discretion of ? the government? at any time? for actions that people they don't know committed?
• lenerdenator 2y ago
  You put in place an incentive to not do these things. Corporate executives and boards do these things because they're incentivized to do so through stock price-based compensation. Great risk should come with great reward. We no longer assign risk to most executives at publicly-traded, multinational corporations, but the reward is still great. I'll leave it to your imagination to figure out what the risk should be, but it should be something that a golden parachute shouldn't be able to resolve.
  • thuuuomas 2y ago
    If your safety systems fail, we pierce the corporate veil.
  • bluGill 2y ago
    > I'll leave it to your imagination to figure out what the risk should be, but it should be something that a golden parachute shouldn't be able to resolve. I agree with that statement, but want so add: I believe that whatever you propose will have significant problems and is likely worse than the status quo in some major way. Sometimes I'll only be able to tell you what those problems are in hindsight. Sometimes those problems are fixable sometimes not. Don't let this dissuade you from thinking about the problem - it needs to be thought about. However do think about is in more than a shallow way, look at it from all viewpoints (including ones of people who disagree with) try to see what the downsides are and how to mitigate them. Good luck, if enough people do this maybe someone will come up with a good enough answer, (as opposed to perfect!) and you will understand the problem well enough to help debate why the downsides are worth it.
    • carapace 2y ago
      Planes are falling out of the sky. I'm a fan of nuance but we're a little past that now.
      • bluGill 2y ago
        Even with that, flying is still vastly safer than driving. We thus know there is a level of risk society is willing to accept.
• deleted 2y ago
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• raxxorraxor 2y ago
  Problem is that no nation is really keen on punishing their own industry. Currently the overall culture for selecting business leaders is suboptimal in the western sphere and beyond. It incentivizes behavior that can lead to such problems. Nobody could sell a 10% growth in reliability to investors if it doesn't come with a similar revenue increase as well.
• WarOnPrivacy 2y ago
  > Our governmental methods of punishment for corporations strike me as lacking. The agencies that oversee this need to have the will and the power to act. Regarding the former, our elected officials are mostly divided into two camps 1) the ones who work to minimize the will of agencies and the ones who are sort of inept and feckless about safeguarding agencies' ability to act. Regarding the latter, the recent scotus Chevron decision monkey-wrenches agency power (seemingly by design). Bad actors will inject judges into the oversight process, in an attempt to sabotage regulators ability to regulate; Chevron hugely amps up the effectiveness of that attack.
• scotty79 2y ago
  There should be capital punishment for legal persons.
• azinman2 2y ago
  Basically jail need to be much more common, and/or these fines come directly from a CEO personally. Then you’ll see change.
• Zigurd 2y ago
  CEO on even numbered days: All assets are always tradable. CEO on odd numbered days: We're systemically important and need to be shielded from liability.