Vexcalibur wrote:
Nobody is saying that corporations should lose all the rights given to them by the assumption they are legal persons. I guess they should keep some.
Actually, that is
exactly what the proposal is saying.
"An amendment to the United States Constitution ... which provides that corporations are not persons under the laws of the United States," would do precisely that. The moment that the Constitution says that, the Common Law and all state and federal law that includes the unqualified word, "person," will become invalid in so far as it applies to corporations.
So, if corporations need to retain the right to enter into contracts, how are you going to go about doing that? If corporations are going to retain the right to sue and be sued, how are you going to go about doing that?
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But a right to privacy, for example is rather silly. Specially for stock-driven companies, it allows much abuse.
Why shouldn't corporations have a right to privacy?
Typically a company minute book is divided in three sections: material that is available to the public (articles of incorporation, bylaws, register of directors, register of members, etc.); material that is available to members only (minutes of members' meetings, financial statements) and material that is available to directors only (minutes of directors meetings, leases and contracts, etc.)
If I incorporate a personal services corporation for my medical practice, it will be a corporation with share capital, operated for profit. Why should any person be eligible to walk in off the street and look at my financial records? Even if we restrict our case to publicly traded corporations, privacy still has an important role to play. We require certain levels of disclosure from publicly traded companies, in the form of audit reports, securities regulatory reporting and the like. If we are concerned about extracting more information for these entities, then there are plenty of legal avenues in which to do that.
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I think a legal middle ground should exist. It is true that we don't want companies to be so liable that nobody wants to invest. But they should be more liable than they are now, libertinage is not having many good ramifications.
Corporate liability is a legitimate area for public policy debate--but the principal that shareholders' liability is limited to their investments is a sound one that we would tamper with at our peril. (Remember, it's the shareholders' liability that is limited, not the company's.)
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--James
26 Jan 2011, 10:52 pm
