Corporate Personhood

Don't be silly, corporations are not people. They can't vote, they can't join the army, they can't have sex or eat chocolate.

Then again, people have every freedom under the First Amendment to form corporations and to direct those corporations to engage in lobbying activities promoting the causes the stockholders deem favorable to the goals of the corporation.

It's pretty clear that the phrase "corporate personhood" is a silly propaganda term invented by people who do not wish others to use their brains and understand the basic issues being discussed, namely the basic constitutional freedoms of people in the United States to peaceably assemble and petition their congress. Those opposed to that incredibly basic freedom have to disguise their opposition as some kind of mystical "the rich are out to get us" conspiracy plot.

ElijahGalt said:

Is your neighborhood get-together a person? Is a union a person? Is an association a person? In the literal sense, of course not. However, these GROUPS of people are entitled to the exact same rights enumerated in the constitution, including the right to speak.

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AMAZING!

Forty one posts before anyone mentions the fact that the whole foo-foraw over the Citizens United decision was that it placed groups of citizens who own corporate stock on an equal footing with people in unions, insofar as their political participation goes.

Corporations clearly ARE NOT given immunity from prosecution. Ask Ken Lay about that.

Corporations, or rather, the people that own them, are granted the same protections under the Bill of Rights against unwarranted search and seizure as any other person in the country. Does anyone seriously want to see those protections removed so the BATF/DEA/FBI can play more Branch Davidian games?

Does anyone seriously think that the corporate officers should be held criminally liable and face jail time if Joe $15/hour dip-tank operator accidentally or even purposely drains a vat of silver nitrate into the city's waste water treatment system? No, they should only be held liable if it can be proven such a criminal act is done as part of corporate policy under orders.

Holding a person criminally liable for an act requires, among other things, for that person to have intent. A corporation cannot have intent. Only it's officers can. The individual stockholders cannot be held criminally liable for a corporations criminal acts unless they're officers of the company. They can, of course, be held liable for their own actions, but merely choosing to purchase stock is not a criminal act. Gee, what happens if an investor buy's Joe's Blue Chip Mutual Fund and one of the fund's corporate holdings is deemed "criminally liable" for some act. From what Mayor Snorkum has read of some of the opinions here, those mutual fund share holders can liable, too.

Which is nonsense.

Catawba said:

Count this left winger in with the libertarians on this. It is so intuitive to me that those that invest in an endeavor should be aware of and support the actions of the company and accept the consequences for their actions just like everyone else.

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So you're arguing that stockholders of corporations should be held personally liable for the actions of the corporation.

This special protection is an invitation to unethical behavior. Enron and the recent wall street fiasco come to mind on a large scale.

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So you're arguing on the stockholders of Enron should be liable for the actions of the corporation that destroyed the value of the stock the stockholders held.

Can you say "ouroboros"?

A corporation screws up (ok, the board of directors screws up). Stocks tumble. Workers lose their jobs. Equipment is sold out.
Is it about personhood? Is a worker of that corporation liable?

Canell said:

A corporation screws up (ok, the board of directors screws up). Stocks tumble. Workers lose their jobs. Equipment is sold out.
Is it about personhood? Is a worker of that corporation liable?

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They should be, if they commit a tort.

Mayor Snorkum said:

So you're arguing that stockholders of corporations should be held personally liable for the actions of the corporation.
[...]
So you're arguing on the stockholders of Enron should be liable for the actions of the corporation that destroyed the value of the stock the stockholders held.

Can you say "ouroboros"?

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Can you say respondeat superior?

Harry Guerrilla said:

That's not what is being suggested though.

In the discovery process of tort, the guilty/negligent (however you want to word it) are identified and those individuals are sued for their shares of ownerships, down to personal holdings.

If the business, as a group, decides to market an unsafe product then all those who knew and still went a long with it, are wholly liable.
The main and most significant problem with limited liability is that those that commit the tort can shield their assets.

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I don't think anyone disputes that officers and employees should be held accountable for crimes they commit on the job. There are already provisions for that in our legal system. We're talking about investors, i.e. individual stockholders. It is totally impractical and ridiculous to hold an 18-year-old kid, with one share of stock he bought online, liable for the actions of the corporation.

Catawba said:

Count this left winger in with the libertarians on this. It is so intuitive to me that those that invest in an endeavor should be aware of and support the actions of the company and accept the consequences for their actions just like everyone else. This special protection is an invitation to unethical behavior. Enron and the recent wall street fiasco come to mind on a large scale.

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So you think that someone who bought one share of Enron stock for $50 and then forgot about it should have lost their life savings? What if they bought an index fund which happened to invest in Enron, unbeknownst to them?

Kandahar said:

I don't think anyone disputes that officers and employees should be held accountable for crimes on the job. There are already provisions for that in our legal system. We're talking about investors, i.e. individual stockholders. It is totally impractical to hold an 18-year-old kid, with one share of stock he bought online, liable for the actions of the corporation.

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That's not really whats being suggested, as far as I'm concerned but with limited liability removed, the change in corporate structures would be drastic, in my opinion.

You're going to have smaller organizations, with investment in those being more personal, but those who commit torts in the organization, shouldn't be able to shield their personal assets from forfeiture.

Harry Guerrilla said:

That's not really whats being suggested, as far as I'm concerned

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Maybe that's not what you were suggesting, but the person to whom I responded definitely suggested it. It sounded ridiculous to me too, which is why I asked for clarification if that was REALLY what he was suggesting. Apparently it is:

Guy Incognito said:

Very few people would be willing to invest in stocks if they were personally responsible for the liabilities of the companies they own. Maybe that just means very few people should be investing in stocks :shrug:

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Harry Guerrilla said:

but with limited liability removed, the change in corporate structures would be drastic, in my opinion.

You're going to have smaller organizations, with investment in those being more personal, but those who commit torts in the organization, shouldn't be able to shield their personal assets from forfeiture.

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You're going to have smaller AND fewer organizations, that are starving for investments, and workers who are terrified of having any responsibility whatsoever. A good recipe to destroy jobs and the economy in general.

Harry Guerrilla said:

That's not really whats being suggested, as far as I'm concerned but with limited liability removed, the change in corporate structures would be drastic, in my opinion.

You're going to have smaller organizations, with investment in those being more personal, but those who commit torts in the organization, shouldn't be able to shield their personal assets from forfeiture.

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Well said. These arguments Kandahar and Maggie are making are sort of silly. It's like saying, "Well if you abolish slavery, what about that poor little old lady who only owns one slave, and is really nice to him?" As if that's some sort of an argument. It's plainly ridiculous.

The fact is a shareholder is a part-owner of a company, and ought to be personally accountable just like any other owner of a company. Would that change the structure of business ownership? Certainly. But only for the better.

Guy Incognito said:

Well said. These arguments Kandahar and Maggie are making are sort of silly. It's like saying, "Well if you abolish slavery, what about that poor little old lady who only owns one slave, and is really nice to him?" As if that's some sort of an argument. It's plainly ridiculous.

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Nah. It's more like saying "If you abolish slavery, should you be able to sue some random guy who once gave $50 to someone who was a slaveowner, completely unbeknownst to him?"

Guy Incognito said:

The fact is a shareholder is a part-owner of a company, and ought to be personally accountable just like any other owner of a company. Would that change the structure of business ownership? Certainly. But only for the better.

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So far you haven't explained at all why it would be a change for the better. You've couched your argument in libertarian ideological terms in every single post (i.e. what you think is "right" or what businesses "should" be like), and not once have you addressed the practical aspects of what you are suggesting: A total lack of ability for businesses to raise money from stocks, sky-high interest rates for bank loans that price most businesses out of THAT market, and an inability to increase sales to customers due to lack of capital. In other words, you are turning off all three of a corporation's spigots of cash flow: Stockholders, banks, and customers.

Kandahar said:

A good recipe to destroy jobs and the economy in general.

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You sound like a southern plantation owner in 1864. Abolishing slavery hurt the economy for the South as well. But it was a good a necessary thing to do because the institution of slavery was morally illegitimate. Likewise, corporate liability shields are morally illegitimate. No practical argument you can make will alter this fact.

Kandahar said:

Nah. It's more like saying "If you abolish slavery, should you be able to sue some random guy who once gave $50 to someone who was a slaveowner, completely unbeknownst to him?"

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There you go with the strawmen again :roll: I'm calling hack on you. I suspected it earlier, but I gave you a second chance, and you blew it.

Guy Incognito said:

You sound like a southern plantation owner in 1864. Abolishing slavery hurt the economy for the South as well. But it was a good a necessary thing to do because the institution of slavery was morally illegitimate. Likewise, corporate liability shields are morally illegitimate. No practical argument you can make will alter this fact.

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:lamo
Is this the new Godwin?

Kandahar said:

Nah. It's more like saying "If you abolish slavery, should you be able to sue some random guy who once gave $50 to someone who was a slaveowner, completely unbeknownst to him?"

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That's the problem now though, call it the "negligent investor" theory, if you will.

There is no compelling need for any investor to care whether or not a company commits torts, because he is only concerned with turning a profit from his or her investment.

Personally, I bought shares in BP when the oil spill happened because I knew that the government would be rather light on them and that the situation would blow over.
I've largely been right.

Guy Incognito said:

There you go with the strawmen again :roll:

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It was YOUR strawman. You're the one that brought up some moronic link to slavery. I just altered it to be a better analogy to the argument at hand.

Guy Incognito said:

I'm calling hack on you. I suspected it earlier, but I gave you a second chance, and you blew it.

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:2bigcry:
Oh noes! How will I go on? I guess I'll just have to live with your disapproval.

Harry Guerrilla said:

Personally, I bought shares in BP when the oil spill happened because I knew that the government would be rather light on them and that the situation would blow over.
I've largely been right.

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And you were right to do so. The law being the way it is it is stupid not to take advantage of limited liability. But what so many people seem to be failing to understand is that taking advantage of limited liability is just that, taking advantage.

Harry Guerrilla said:

That's the problem now though, call it the "negligent investor" theory, if you will.

There is no compelling need for any investor to care whether or not a company commits torts, because he is only concerned with turning a profit from his or her investment.

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Well, they care about companies that commit torts to the extent that those torts eat into the company's bottom line, because it lowers the value of their shares.

Harry Guerrilla said:

Personally, I bought shares in BP when the oil spill happened because I knew that the government would be rather light on them and that the situation would blow over.
I've largely been right.

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So then the solution is to be harder on them, not to hold the investors responsible who had nothing to do with it. Are you suggesting that everyone who owned a share of BP stock at the time of the oil spill should have been sued personally...even if they didn't know that they owned it? With global stock markets and all sorts of funds of different types of stocks, it is not reasonable to expect every investor to research every stock and have perfect information about the inner workings of the company. Doing so would completely destroy the whole concept of raising money from stocks.

Kandahar said:

Well, they care about companies that commit torts to the extent that those torts eat into the company's bottom line, because it lowers the value of their shares.

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Only temporarily, as time goes on the effects of the actions are limited, because of limited liability, so it doesn't really present a problem.

Kandahar said:

So then the solution is to be harder on them, not to hold the investors responsible who had nothing to do with it. Are you suggesting that everyone who owned a share of BP stock at the time of the oil spill should have been sued personally...even if they didn't know that they owned it? With global stock markets and all sorts of funds of different types of stocks, it is not reasonable to expect every investor to research every stock and have perfect information about the inner workings of the company. Doing so would completely destroy the whole concept of raising money from stocks.

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No not every person should of been sued but the people responsible for the operations, should be liable.
With their skin on the line, it would cause them to act with greater care to avoid losing their shirts.

Again, as I stated earlier, the issue is personhood, not liability limits. Some limits on liability are reasonable. For the reasons being discussed.

All of these concerns could be addressed through some other mechanism, without conferring the rights of a person on en entity that is fundamentally incapable of being held accountable for its actions.

I once read an explanation of the differences between a corporation and a person. How many wheelbarrows of dirt can a person push in their lifetime?
whatever the answer, its a finite number. A corporation can hire people to push an infinite number of wheelbarrows. This was an example illustrating the fundamental difference in "income" between individuals and corps.

There's also the ability for a corporation to extend a pseudopod, shielded by liability limits, which it uses to engage in some questionable activity somewhere in the world. If its activities are deemed unacceptable, and its goals thwarted, the most the parent company stands to lose is the pseudopod. The functionally immortal corporation lives on.

In reality corporations resemble viruses or cancers far more than people. Or a yeast or mold. Growing for their own growth, with little concern for the medium in which they grow. Not like a "member" of the medium.

I know these are simplifications, but the question in the OP concerned corporate personhood, a legal fiction. Not limits on liability. Focusing on this aspect, which could be addressed in some other way, ignores the question in the OP.:2wave:

Harry Guerrilla said:

Only temporarily, as time goes on the effects of the actions are limited, because of limited liability, so it doesn't really present a problem.

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"Limited liability" is really only an issue if the company goes bankrupt. If it doesn't go bankrupt, the funds will come out of the company's assets (and therefore, out of the stockholders' equity). You're right that investors aren't worried about torts exceeding the value of the company, nor should they have to be, from a practical standpoint.

Harry Guerrilla said:

No not every person should of been sued but the people responsible for the operations, should be liable.
With their skin on the line, it would cause them to act with greater care to avoid losing their shirts.

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The law already provides for employees of the company to be held accountable for crimes they commit on the job, and in certain cases, for torts. A person acting outside the scope of his employment will be held personally liable for torts. A person violating the Foreign Corrupt Practices Act can be held personally liable for torts. A person who commits torts for personal gain (rather than corporate gain) can be held personally liable for torts. A person who treats his corporation as a legal appendage of himself rather than as a legitimate business can be held personally liable for torts.

But being able to sue individual employees for every tort they commit in the scope of employment is a bad idea. There is a certain expectation that large corporations know the law and are able to stay within it; they have corporate legal departments, after all. There is much less expectation that individuals know civil law in and out. If your employer tells you to do something and you have no reason to question his/her ethics, I think most people would assume that it was legal.

Holding employees personally liable for all torts committed on behalf of their place of employment would terrify employees and cause them to duck responsibility. There are certain exceptions, like the ones I mentioned above, where they aren't approved by the employer and/or are unquestionably unethical. But in general it makes sense to shield some employees.

Mayor Snorkum said:

AMAZING!

Forty one posts before anyone mentions the fact that the whole foo-foraw over the Citizens United decision was that it placed groups of citizens who own corporate stock on an equal footing with people in unions, insofar as their political participation goes.

Corporations clearly ARE NOT given immunity from prosecution. Ask Ken Lay about that.

Corporations, or rather, the people that own them, are granted the same protections under the Bill of Rights against unwarranted search and seizure as any other person in the country. Does anyone seriously want to see those protections removed so the BATF/DEA/FBI can play more Branch Davidian games?

Does anyone seriously think that the corporate officers should be held criminally liable and face jail time if Joe $15/hour dip-tank operator accidentally or even purposely drains a vat of silver nitrate into the city's waste water treatment system? No, they should only be held liable if it can be proven such a criminal act is done as part of corporate policy under orders.

Holding a person criminally liable for an act requires, among other things, for that person to have intent. A corporation cannot have intent. Only it's officers can. The individual stockholders cannot be held criminally liable for a corporations criminal acts unless they're officers of the company. They can, of course, be held liable for their own actions, but merely choosing to purchase stock is not a criminal act. Gee, what happens if an investor buy's Joe's Blue Chip Mutual Fund and one of the fund's corporate holdings is deemed "criminally liable" for some act. From what Mayor Snorkum has read of some of the opinions here, those mutual fund share holders can liable, too.

Which is nonsense.

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A corporation can't have intent. Another reason its not a person.

Thank you.

Kandahar said:

"Limited liability" is really only an issue if the company goes bankrupt. If it doesn't go bankrupt, the funds will come out of the company's assets (and therefore, out of the stockholders' equity). You're right that investors aren't worried about torts exceeding the value of the company, nor should they have to be, from a practical standpoint.



The law already provides for employees of the company to be held accountable for crimes they commit on the job, and in certain cases, for torts. A person acting outside the scope of his employment will be held personally liable for torts. A person violating the Foreign Corrupt Practices Act can be held personally liable for torts. A person who commits torts for personal gain (rather than corporate gain) can be held personally liable for torts.

But being able to sue individual employees for every tort they commit in the scope of employment is a bad idea. There is a certain expectation that large corporations know the law and are able to stay within it; they have corporate legal departments, after all. There is much less expectation that individuals know civil law in and out. If your employer tells you to do something and you have no reason to question his/her ethics, I think most people would assume that it was legal.

Holding employees personally liable for all torts committed on behalf of their place of employment would terrify employees and cause them to duck responsibility. There are certain exceptions, like the ones I mentioned above, where they aren't approved by the employer and/or are unquestionably unethical. But in general it makes sense to shield some employees.

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I think you're missing what I'm saying in large part.

If Bob and Jim own, Dow Chemicals.

Bob, unbeknown to Jim, dumps 3000 gallons of benzene in the local river, kills some fish and a few people.
Bob should be completely financially liable from his personal possessions to his share of the business.

Harry Guerrilla said:

I think you're missing what I'm saying in large part.

If Bob and Jim own, Dow Chemicals.

Bob, unbeknown to Jim, dumps 3000 gallons of benzene in the local river, kills some fish and a few people.
Bob should be completely financially liable from his personal possessions to his share of the business.

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And assuming that that is a criminal act as well as a civil tort, he would be.