Re:Elizabeth Warren unveils bold new plan to reshape America...
by notacoward on Wednesday August 15, 2018 @05:02PM
(#17769755)
> This bill seems like it forces socialism/command economy on all companies valued greater than 1 billion dollars
That's an absolute caricature of what the bill does. It doesn't mandate what products or services companies can provide, how they charge for those services, what deals they make, etc. There's none of the fine-grained control that a real command economy would entail. All it does is change the operative definition of fiduciary duty to include people besides shareholders who are affected by a company's actions.
There are both moral and practical justifications for this. The moral justification is that it's unfair to give corporations every advantage given to real flesh-and-blood people, while also preserving their natural advantages - immortality, immunity to imprisonment for crimes, and most pertinently limitation of liability. The natural state of the market does not include limited liability. In order for the state to extend that favor to corporations (by extension to their principals and shareholders) there must be some compelling benefit to the people the state represents, otherwise it's not a deal but a steal. Historically, when corporations were first created, it was on the basis of a charter spelling out the nature of that benefit and holding them accountable for its realization (e.g. to build a road, bridge, or canal).
That brings us to the practical justification. The lack of such charters has empirically been very bad for the middle class, for the environment, for political stability, etc. In short, the grantors of these favors - the people behind the government that defines and enforces civil law - are not getting their money's worth. They're giving and not getting, even more so when the benefits can flow overseas while the costs stay here. Once government starts doing favors for corporations without expecting anything back, what you have is neither democracy nor capitalism but oligarchy. Since you made the mistake of mentioning the Soviet Union, all I need do is point to its successor state for an example. It's a bad deal, and it's bad policy. Enforceable limited charters are long overdue for a comeback.
P.S. I'm no millennial. I'm a very early GenX if you must know. What that means is that I've had time to study this stuff at more than a superficial level, so your well-poisoning is entirely off target.
That's an absolute caricature of what the bill does. It doesn't mandate what products or services companies can provide, how they charge for those services, what deals they make, etc. There's none of the fine-grained control that a real command economy would entail. All it does is change the operative definition of fiduciary duty to include people besides shareholders who are affected by a company's actions.
There are both moral and practical justifications for this. The moral justification is that it's unfair to give corporations every advantage given to real flesh-and-blood people, while also preserving their natural advantages - immortality, immunity to imprisonment for crimes, and most pertinently limitation of liability. The natural state of the market does not include limited liability. In order for the state to extend that favor to corporations (by extension to their principals and shareholders) there must be some compelling benefit to the people the state represents, otherwise it's not a deal but a steal. Historically, when corporations were first created, it was on the basis of a charter spelling out the nature of that benefit and holding them accountable for its realization (e.g. to build a road, bridge, or canal).
That brings us to the practical justification. The lack of such charters has empirically been very bad for the middle class, for the environment, for political stability, etc. In short, the grantors of these favors - the people behind the government that defines and enforces civil law - are not getting their money's worth. They're giving and not getting, even more so when the benefits can flow overseas while the costs stay here. Once government starts doing favors for corporations without expecting anything back, what you have is neither democracy nor capitalism but oligarchy. Since you made the mistake of mentioning the Soviet Union, all I need do is point to its successor state for an example. It's a bad deal, and it's bad policy. Enforceable limited charters are long overdue for a comeback.
P.S. I'm no millennial. I'm a very early GenX if you must know. What that means is that I've had time to study this stuff at more than a superficial level, so your well-poisoning is entirely off target.