Vinay Gupta has a fascinating article on WorldChanging that characterizes limited liability corporations as a form of government subsidy (because otherwise, these companies would have to take out expensive liability insurance). Gupta posits that thhis creates a "perverse incentive" to do bad things, like pollute, and wonders aloud what would happen if LLCs were phased out:
What if we phased out limited liability? Suppose, for example, we made shareholders liable for up to 1% of their assets in corporate bankruptcy cases - you can lose up to 1% of your net worth to cover the unpaid debts of corporations in which you own stock. Would that change shareholder behavior to less risky investments? Would it cool the economy - or increase corporate responsibility at no cost to the tax payer?
Could regulating the degree of investor protection become one way of pulling corporations back into line when corruption becomes rife? Would ENRON have happened if shareholders had been even partially liable?
I'm not enough of an economist to really understand the implications of this idea, but I'd like to open the floor up to discussion: is viewing limited liability as a subsidy to the investor a valid way of thinking about it, and is reducing that subsidy to the investor a plausible way of making our economy a little more risk-averse and therefor environmentally responsible?
The increasingly popular social media application TikTok has a concerning relationship with the Chinese state. That link became ever the more concerning today, when reports began circulating of a brand new partnership between the company that owns TikTok, ByteDance, and the government of China.
Senator and 2020 US presidential candidate Bernie Sanders’ “High-Speed Internet For All” plan, unveiled today, promises $150 billion to build publicly owned broadband networks — and to break the chokehold that Comcast, Verizon, and AT&T have on Americans’ access to information and communication.
People who ask themselves why they need a dashcam usually have one thing in common: They’ve never been a serious collision. Even in fender benders, these gadgets can save you an immense amount of time and hassle, stopping headaches before they even start. If you’re looking for a reliable starter cam, the myGEKOgear Orbit 110 […]
There’s no shortage of wireless chargers out there. So when one scores a Best of Innovation Award at the Consumer Electronics Show, we take notice. And, those industry nods mean good news for just about anybody with a smartphone, because the HyperCharger X Wireless Charger means there’s no excuse for losing power when you’re out […]
Once you’ve cut steak or poultry with some actual quality knives, it’s really tough to go back to those budget blades you bought at the department store a couple of decades ago. Consider that a fair warning about this 5-Piece Professional Damascus Chef’s Kitchen Set. The holiday discount makes it easy to buy for a […]