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The opposite questions are more interesting. Can corporations truly be held accountable? Could we institute a corporation death penalty?

gruez 1y ago
"corporation death penalty" just sounds like the state seizing the company (dispossessing existing shareholders in the process), but worded more dramatically.
- bombcar 1y ago
  Seizing the company keeps the company running - likely. The “corporate death penalty” would be seizing it and selling off assets at such small pieces that it would be hard to reassemble the whole.
  - gruez 1y ago
    What's the point in scattering the company into a bazillion pieces? Let's take the example of a company that would deserve the corporate death penalty the most, Purdue Pharma. What would the point in breaking it up? Is leaving it intact going to cause the next opioid epidemic or something?
    - fmajid 1y ago
      Accountancy firm Arthur Andersen suffered a de facto corporate death penalty for rubber-stamping Enron's accounts.
    - bombcar 1y ago
      The whole point of a CDP is to push some liability onto the limited liability shareholders. Basically, make it so there are crimes that the shareholders will themselves police the company, because they don’t want to risk losing it all. Part of a CDP would be NOT paying back bondholders, etc. it’s spreading the pain around so nobody will lend or support a company doing activities that open the door to CDP.
  - Aurornis 1y ago
    That would destroy most of the value of the company. Typical companies operate with some debt load (financing, etc). That would have to be paid off with the proceeds of selling off their pieces. So in practice, even selling it off would produce zero or negative monetary return once debts were settled. You’d also be obliterating tens or hundreds of thousands of jobs overnight.
    - two_handfuls 1y ago
      Arguably, if the company is so egregiously misbehaving that it deserves the "corporate death penalty" then its societal value is negative. That is, selling it off for a zero or negative monetary return as you say may still leave us better off.
    - robocat 1y ago
      > So in practice, even selling it off would produce zero or negative monetary return once debts were settled In New Zealand that shouldn't happen, because directors are legally required to keep a company solvent. * cashflow solvency: pay company debts as they become due * balance sheet solvency: company assets exceed liabilities (including contingent liabilities). * directors might become personally liable if the company's solvency test is screwed up
- nickpsecurity 1y ago
  When we receive the death penalty, the state doesn't just physically seize our bodies. We die. We have neither assets nor any benefit of life. It can also have highly negative effects of others since it's a sudden, catastrophic loss. For a corporation, that would be like its operations totally ceasing, all employees are fired, shares might go to zero value, and individual assets sold off (like a will). That "shares going to zero" part would be important for accountability.
  - gruez 1y ago
    >When we receive the death penalty, the state doesn't just physically seize our bodies. We die. We have neither assets nor any benefit of life. It can also have highly negative effects of others since it's a sudden, catastrophic loss. Corporations aren't people though. For one, corporations are just groups of people, so it's hard to claim that it's irredeemable and must suffer the death penalty. If you take a corporation, replace its board, executives, and employees, is it even the same corporation? >operations totally ceasing, all employees are fired, [...] and individual assets sold off (like a will). What purpose does this serve? >That "shares going to zero" part would be important for accountability. That happens regardless of the "death penalty" though. The government dispossessing all shareholders has the same effect.
    - nickpsecurity 1y ago
      "Corporations aren't people though. For one, corporations are just groups of people" I agree with you. The law disagrees by making them people under law. They can own assets, sue, and be sued. If they're people, I want them to have equal accountability, not just power. That includes severe punishment. "What purpose does this serve?" With people, the purpose of capital punishment is three fold: justice for victims of horrible crimes; remove an offender who might do it again; strong deterrent to others. Let's say we had evidence of a chemical company lying about the safety of its products that killed people. Not a miscalculation but hiding evidence. It gets the death penalty with executives losing their money, all jobs are lost, and its products disappear permanently. Individuals involved are criminally charged, too. People also hear the next company that kills people to get rich will be treated the same. You think the executives of the next company will do that? You think the employees, whose jobs are on the line, will be as likely to stay silent or more likely to blow the whistle? Do you think the shareholders will reward people who avoid or run headfirst into the corporate, death penalty? I'm sure plenty of evil will happen. The death penalty would probably be rare for established businesses. It would probably be more fly by night operators. Yet, I bet that level of accountability would make us safer. When it didn't, the victims would get real justice.
- Aurornis 1y ago
  I’m all for imposing fines and restrictions in proportion to damage done. Officers of the company should be held legally liable for their roles in decision making. However, I’m also amazed when these discussions generate calls for “corporate death penalty” powers being handed to the government and/or used for various transgressions. This entire discussion section is occurring under and article about the current administration abusing government powers for their own gain. How can people be so quick to call for even more levers for corrupt governments to use? “Nice company you got there. Would be a shame if it got the death penalty. On an unrelated note, my campaign fund could use another $100 million if you know anyone…” Let’s leave the punishments as proportional to the damage/crime.
  - mindslight 1y ago
    ugh, you're right. This is the problem with the spiral into fascism - people increasingly demand accountability, but that energy doesn't lead to actual in-system reform but rather just more differentish corruption, which then drives even more increased demands for accountability. A similar dynamic is at play with Luigi. Someone finally pierced the corporate/legal abstractions of the healthcare cartel with some extrajudicial punishment on one of the more-visible cogs. We can all understand that, and it's downright cathartic... But when Krasnov calls Bezos and tells him to discontinue publicizing how much Krasnov's new import taxes are costing everyone, Bezos knows how popularly hated his corporate ownership class is. If Krasnov ends him tomorrow most people won't be horrified, rather there will be throngs cheering it on - the rule of law no longer protects him. And so he has little choice but to lash himself to the fascist's power and comply. I wish I knew how to reverse the trend.
  - immibis 1y ago
    Keeping certain powers away from "good" governments doesn't stop their successor "bad" governments from granting themselves those powers anyway.
- Sniffnoy 1y ago
  Generally "corporate death penalty" refers to this: https://en.wikipedia.org/wiki/Judicial_dissolution https://en.wikipedia.org/wiki/Judicial_dissolution
siliconc0w 1y ago
Ex. is 3M - literally poisoned the earth with impossible to remove chemicals causing eternal damage to our civilization.
- blibble 1y ago
  (PFAS) 3M knew exactly how bad it was too, back to the 70s a corporate death sentence isn't enough, jail every board member who was involved
- Braxton1980 1y ago
  The only way this will stop is if we attack the people in charge at the time or financial penalties for their families.
  - worthless-trash 1y ago
    There is always the 'excuse' they didn't know. Which cleary is a cop-out, doing some kind of analysis of effects and understanding them at the top IS one of their responsibilties.
    - Braxton1980 1y ago
      Then make that excuse no longer valid
  - Ekaros 1y ago
    And also actually put financial penalties on shareholders during period. Even if they are pension funds. They profited, they should also borne full cost of those profits.
kjkjadksj 1y ago
That would just lead to shell games. You have to take the people who greenlit things in bad faith and put them in jail for life. Then you’d see actual changes and dare I say, even a whisper of benevolence.
crazygringo 1y ago
> Could we institute a corporation death penalty? That's what bankruptcy is. Existing owners (stockholders) lose the company entirely. The company gets sold to entirely new owners. And while bankruptcy is usually due to mismanagement or bad luck, it can also certainly happen because a legal judgment or fine makes the corporation no longer viable. But if you're asking for the company to be destroyed to the extent where every single contract is cancelled and every single person gets laid off, that's not generally desirable. We don't want people to lose their jobs, or customers to stop receiving what a company produces, whenever possible. There's a lot of value in a functioning corporation that you don't want to just disappear. Better to let new owners reuse it.
- Sniffnoy 1y ago
  Generally the phrase "corporate death penalty" refers to revoking the charter, not bankruptcy. Which you argue is undesirable, but like, that is what the phrase normally refers to.
  - crazygringo 1y ago
    Sure, the technical term is "judicial dissolution". But the main counterpoint is that there's literally no point to that. If you want to punish the owners, there's no difference between taking the value of their investment to zero, or going beyond that and destroying every contract and job. The owners don't care if a receptionist loses their job too, but the receptionist sure does. It becomes more than just a "death penalty" -- it becomes a "nuclear bomb" that takes out everyone. So bankruptcy already accomplishes everything you'd want from a "corporate death penalty". The company is gone as far as the previous owners are concerned.
    - M95D 1y ago
      There is a point. If everyone in the company fear of losing their jobs, there would be a lot more internal resistance to illegal activities, a lot more whistle blowers.
      - 1y ago
Sniffnoy 1y ago
It's rarely used, but it does exist: https://en.wikipedia.org/wiki/Judicial_dissolution https://en.wikipedia.org/wiki/Judicial_dissolution

gruez 1y ago

"corporation death penalty" just sounds like the state seizing the company (dispossessing existing shareholders in the process), but worded more dramatically.

bombcar 1y ago
Seizing the company keeps the company running - likely. The “corporate death penalty” would be seizing it and selling off assets at such small pieces that it would be hard to reassemble the whole.
- gruez 1y ago
  What's the point in scattering the company into a bazillion pieces? Let's take the example of a company that would deserve the corporate death penalty the most, Purdue Pharma. What would the point in breaking it up? Is leaving it intact going to cause the next opioid epidemic or something?
  - fmajid 1y ago
    Accountancy firm Arthur Andersen suffered a de facto corporate death penalty for rubber-stamping Enron's accounts.
  - bombcar 1y ago
    The whole point of a CDP is to push some liability onto the limited liability shareholders. Basically, make it so there are crimes that the shareholders will themselves police the company, because they don’t want to risk losing it all. Part of a CDP would be NOT paying back bondholders, etc. it’s spreading the pain around so nobody will lend or support a company doing activities that open the door to CDP.
- Aurornis 1y ago
  That would destroy most of the value of the company. Typical companies operate with some debt load (financing, etc). That would have to be paid off with the proceeds of selling off their pieces. So in practice, even selling it off would produce zero or negative monetary return once debts were settled. You’d also be obliterating tens or hundreds of thousands of jobs overnight.
  - two_handfuls 1y ago
    Arguably, if the company is so egregiously misbehaving that it deserves the "corporate death penalty" then its societal value is negative. That is, selling it off for a zero or negative monetary return as you say may still leave us better off.
  - robocat 1y ago
    > So in practice, even selling it off would produce zero or negative monetary return once debts were settled In New Zealand that shouldn't happen, because directors are legally required to keep a company solvent. * cashflow solvency: pay company debts as they become due * balance sheet solvency: company assets exceed liabilities (including contingent liabilities). * directors might become personally liable if the company's solvency test is screwed up
nickpsecurity 1y ago
When we receive the death penalty, the state doesn't just physically seize our bodies. We die. We have neither assets nor any benefit of life. It can also have highly negative effects of others since it's a sudden, catastrophic loss. For a corporation, that would be like its operations totally ceasing, all employees are fired, shares might go to zero value, and individual assets sold off (like a will). That "shares going to zero" part would be important for accountability.
- gruez 1y ago
  >When we receive the death penalty, the state doesn't just physically seize our bodies. We die. We have neither assets nor any benefit of life. It can also have highly negative effects of others since it's a sudden, catastrophic loss. Corporations aren't people though. For one, corporations are just groups of people, so it's hard to claim that it's irredeemable and must suffer the death penalty. If you take a corporation, replace its board, executives, and employees, is it even the same corporation? >operations totally ceasing, all employees are fired, [...] and individual assets sold off (like a will). What purpose does this serve? >That "shares going to zero" part would be important for accountability. That happens regardless of the "death penalty" though. The government dispossessing all shareholders has the same effect.
  - nickpsecurity 1y ago
    "Corporations aren't people though. For one, corporations are just groups of people" I agree with you. The law disagrees by making them people under law. They can own assets, sue, and be sued. If they're people, I want them to have equal accountability, not just power. That includes severe punishment. "What purpose does this serve?" With people, the purpose of capital punishment is three fold: justice for victims of horrible crimes; remove an offender who might do it again; strong deterrent to others. Let's say we had evidence of a chemical company lying about the safety of its products that killed people. Not a miscalculation but hiding evidence. It gets the death penalty with executives losing their money, all jobs are lost, and its products disappear permanently. Individuals involved are criminally charged, too. People also hear the next company that kills people to get rich will be treated the same. You think the executives of the next company will do that? You think the employees, whose jobs are on the line, will be as likely to stay silent or more likely to blow the whistle? Do you think the shareholders will reward people who avoid or run headfirst into the corporate, death penalty? I'm sure plenty of evil will happen. The death penalty would probably be rare for established businesses. It would probably be more fly by night operators. Yet, I bet that level of accountability would make us safer. When it didn't, the victims would get real justice.
Aurornis 1y ago
I’m all for imposing fines and restrictions in proportion to damage done. Officers of the company should be held legally liable for their roles in decision making. However, I’m also amazed when these discussions generate calls for “corporate death penalty” powers being handed to the government and/or used for various transgressions. This entire discussion section is occurring under and article about the current administration abusing government powers for their own gain. How can people be so quick to call for even more levers for corrupt governments to use? “Nice company you got there. Would be a shame if it got the death penalty. On an unrelated note, my campaign fund could use another $100 million if you know anyone…” Let’s leave the punishments as proportional to the damage/crime.
- mindslight 1y ago
  ugh, you're right. This is the problem with the spiral into fascism - people increasingly demand accountability, but that energy doesn't lead to actual in-system reform but rather just more differentish corruption, which then drives even more increased demands for accountability. A similar dynamic is at play with Luigi. Someone finally pierced the corporate/legal abstractions of the healthcare cartel with some extrajudicial punishment on one of the more-visible cogs. We can all understand that, and it's downright cathartic... But when Krasnov calls Bezos and tells him to discontinue publicizing how much Krasnov's new import taxes are costing everyone, Bezos knows how popularly hated his corporate ownership class is. If Krasnov ends him tomorrow most people won't be horrified, rather there will be throngs cheering it on - the rule of law no longer protects him. And so he has little choice but to lash himself to the fascist's power and comply. I wish I knew how to reverse the trend.
- immibis 1y ago
  Keeping certain powers away from "good" governments doesn't stop their successor "bad" governments from granting themselves those powers anyway.
Sniffnoy 1y ago
Generally "corporate death penalty" refers to this: https://en.wikipedia.org/wiki/Judicial_dissolution https://en.wikipedia.org/wiki/Judicial_dissolution

siliconc0w 1y ago

Ex. is 3M - literally poisoned the earth with impossible to remove chemicals causing eternal damage to our civilization.

blibble 1y ago
(PFAS) 3M knew exactly how bad it was too, back to the 70s a corporate death sentence isn't enough, jail every board member who was involved
Braxton1980 1y ago
The only way this will stop is if we attack the people in charge at the time or financial penalties for their families.
- worthless-trash 1y ago
  There is always the 'excuse' they didn't know. Which cleary is a cop-out, doing some kind of analysis of effects and understanding them at the top IS one of their responsibilties.
  - Braxton1980 1y ago
    Then make that excuse no longer valid
- Ekaros 1y ago
  And also actually put financial penalties on shareholders during period. Even if they are pension funds. They profited, they should also borne full cost of those profits.

kjkjadksj 1y ago

That would just lead to shell games. You have to take the people who greenlit things in bad faith and put them in jail for life. Then you’d see actual changes and dare I say, even a whisper of benevolence.

crazygringo 1y ago

> Could we institute a corporation death penalty? That's what bankruptcy is. Existing owners (stockholders) lose the company entirely. The company gets sold to entirely new owners. And while bankruptcy is usually due to mismanagement or bad luck, it can also certainly happen because a legal judgment or fine makes the corporation no longer viable. But if you're asking for the company to be destroyed to the extent where every single contract is cancelled and every single person gets laid off, that's not generally desirable. We don't want people to lose their jobs, or customers to stop receiving what a company produces, whenever possible. There's a lot of value in a functioning corporation that you don't want to just disappear. Better to let new owners reuse it.

Sniffnoy 1y ago
Generally the phrase "corporate death penalty" refers to revoking the charter, not bankruptcy. Which you argue is undesirable, but like, that is what the phrase normally refers to.
- crazygringo 1y ago
  Sure, the technical term is "judicial dissolution". But the main counterpoint is that there's literally no point to that. If you want to punish the owners, there's no difference between taking the value of their investment to zero, or going beyond that and destroying every contract and job. The owners don't care if a receptionist loses their job too, but the receptionist sure does. It becomes more than just a "death penalty" -- it becomes a "nuclear bomb" that takes out everyone. So bankruptcy already accomplishes everything you'd want from a "corporate death penalty". The company is gone as far as the previous owners are concerned.
  - M95D 1y ago
    There is a point. If everyone in the company fear of losing their jobs, there would be a lot more internal resistance to illegal activities, a lot more whistle blowers.
    - 1y ago

Sniffnoy 1y ago

It's rarely used, but it does exist: https://en.wikipedia.org/wiki/Judicial_dissolution https://en.wikipedia.org/wiki/Judicial_dissolution