From: Charles Hixson (charleshixsn@earthlink.net)
Date: Fri Sep 12 2003 - 10:26:53 MDT
Randall Randall wrote:
> ...
> Well, limited liability is a State-enforced distortion of
> the market, rather than something inherent in the market.
> I agree that limited liability should be abolished.
>
Be quite careful here. The basic distortion is that the corporation is
granted the rights of a person, without simultaneous having the limits
or obligations of a person.
Limited Liability Corporations legitimately shield their investors from
many liabilities for the actions in corporations that the investors
theoretically have partial ownership in, but over which they actually
neither have either reasonable control or detailed knowledge. But I
know of no ground for shielding the executives of the corporation from
liability, as seems to be common practice. And I also feel that the
board of directors should be more liable. And the individual employees,
whether executives or not. If a corporation pours poison in a
communities drinking water, then the entire chain of personnel involved
should be liable. To the extent that they either knew or should have
known. And one scapegoat should not be allowed to exculpate the rest.
This vile example is based on a case where company (Monsanto?)
calculated that it would cost them less in fines to dump poison in a
community's drinking water supply than it would to clean it up properly.
So they did. And they were right. Even though internal memos
released during the trial showed that they had made this calculation
ahead of time. Personally I think this was ground for confiscating the
entire corpation, and selling it for it's assets, and for sending most
of the management and most of the directors to jail for premeditated
murder and many of the staff to jail for accessory during the fact. But
they were, instead, given the fine which, as they had calculated, was
less than the cost of cleaning things up properly was.
As for the investors...most of them still don't know that it happened.
And many don't even know that they are investors. (Investment through
market large cap funds, e.g.) So while it's a reasonable penalty that
they should loose their investment, they bear no real culpability.
-- -- Charles Hixson Gnu software that is free, The best is yet to be.
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