Some days ago, Harmon Seaver wrote:
> >Megacorp are every bit as evil as governments are. The destruction
> >of the state and multinational corps go hand-in-hand. In fact, they
> >probably are even more evil -- and certainly more efficient in their
evil.
And Duncan Frissell replied:
> Governments derive all their revenue by threatening to kill
> people. Corporations only derive a small part of their revenue from other
> institutions (governments) that derive their revenue by threatening to
kill
> people. No contest.
Which I agree with. But c'mon, folks -- what makes something a corporation,
anyway? What is a corporation, that it might be inherently evil?
A corporation is nothing more nor less than a fictional person, deemed to
exist by the state and granted special privileges thereby. The most common
such privilege is the power to assume liability for debts incurred by actual
persons who control the corporation, thus shielding such actual persons from
liability for the debts they incur. This considerable benefit gives
corporations a competitive advantage over human businessmen. Furthermore,
it is widely believed, and might even be true, that corporations "generate"
wealth by encouraging lucrative investments that would be too risky for
individual investors or consortia thereof.
A corporation is thus a creature of the state, and unworthy of any
particular respect. However, rarely do corporations arrogate to themselves,
as states do, the power to openly brutalize or kill competitors.
Accordingly, I agree with Duncan that governments are much worse.
I have often wondered whether a truly free society would suffer from the
fact that no state exists to create fictional persons and give them special
benefits. Would having no corporations limit the ability to make risky but
lucrative investments, as is commonly believed?
I do not think so. For minimal transaction costs, I do not see why an
individual could not conduct business on a limited-recourse basis,
contracting with each creditor and supplier such that each obligation was
backed only by a specified set of business assets, and no personal ones.
Obviously this was not possible under primitive systems of state-sponsored
contract law, which is why corporations evolved. But in competing systems
of private laws such as those described by David Friedman and others, surely
it could be managed. Whether it would be done, or not, presumably depends
on whether the higher cost of credit was outweighed by the business
advantages and alleged greater productivity of investment.
It's silly to rant about corporations. Anything bad that they can do,
governments do more often and with a bigger body count. If you snip the
weed at its roots, the leaves will wither away.....
-- Daniel
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