Nobody is confused about why limited liability exists, so I don't think it needs to be brought up every time someone points out the problems with it. It generally comes across as just trying to shut down the conversation, and refuse to admit there are very large downsides to limited liability.
I don't know why you assume you benefit from this not being the case: when Ford was sued for the Pinto, shareholders of Ford lost money which they wouldn't have lost if the decision makers had paid more of the settlement.
One possible way to regulate this is related to voting and non-voting shares. If you want to invest in a company without taking on liability, you can invest in non-voting shares--since you can't make any decisions for the company, you can't be held liable if the company decides to do something wrong. But you shouldn't be able to take part in the decision making of a company without also taking responsibility if you decide to do something wrong.
If the goal is specifically to assist startups, then let's find some way to codify that. It sounds like one of those cases of unintended consequences. Is it trying to help out the little guy? It sure looks like it's helping the rich stay rich.
the goal of limited liability is not specifically to help startups, it's a common law concept that predates "startups" by hundreds of years. I would argue that it helps the little guy much more than the extremely wealthy. I personally could not invest at all if I couldn't limit my losses to the amount of money I put in. people with millions of dollars can take on a lot more risk without becoming homeless if one or two holdings goes belly-up.
Part of the difficulty here is that ownership confers some power to shareholders (the ability to vote in some corporate matters) but doesn't confer any responsibility for those decisions. For the average investor, this is a good thing: I don't have time to vote in every shareholder election I hold the right to vote in, so it doesn't make sense to hold me liable for elections I didn't vote in.
A possible solution here is non-voting shares. Limited liability could easily apply only to those holding non-voting shares, and people could have the ability to convert voting shares into non-voting shares if they don't intend to vote in shareholder elections.
This is some helicopter parenting nonsense. I want to play too but not get hurt.
If one wants to be a service provider, in a free market, reliant on customers who in turn rely on them, shoulder all the risk.
On the flip side other nations use universal social services to insure the general public if cushioned from complete failure.
Anyone getting into business should really feel the burden. And big corp leadership should feel an even bigger burden for being too big to fail. They want to be that big they should be ready for a hard fall.
I don’t owe political deference to corporate. They get my time and that’s good enough.
In a more general sense, we as a society need to take a long, hard look at limited liability. We cannot call for more personal responsibility in society with one hand while with the other hand letting malicious decision-makers walk away with their personal fortunes while workers and shareholders take on the cost of their actions. People need to be held accountable for their actions, and this is especially true for people in positions of power whose actions can affect millions of people.