Corporate Executions?

I often hang out with an ultra liberal crowd, and occasionally hear rumblings from people about how evil corporations are, not just the big names who have made the news for some dastardly deed, but all corporations.  My usual response is "wait a minute here, I'm president of a tiny corporation and it's no more evil than I am" (okay maybe that's not the best example :-). 

The point here is that corporations are made up of people, and they are no more or less evil than the people who are part of them, the shareholders, the board of directors, the officers, and the employees.

What happens in a corporation is shareholders provide their money and demand that the corporation make them a (preferably large) profit, and then sit back and wait for the money, no participation, little or no oversight, no blame, but if they fail to deliver, the board of directors (rarely) and/or top corporate officers risk losing their jobs.  If you gave money to a street thug and said to them "you are going to bring back my money and 25% more", you would hardly be surprised if you heard they mugged someone to get the money, so why would you be surprised if the corporation mugs people for the money as well?  You don't personally know the people who you gave the money to, you exercised no oversight of their behavior, and you demanded a profit.  Guess what, this statement could just as easily have described a loan shark!  Maybe the problem is the investors and not the big evil corporation!  It's easy to focus our attention in the wrong place, because the corporation is a visible single public entity, where the investors are everywhere and it's hard to focus your attention on them, but make no mistake, the investors are the problem!

So what is the solution?  At the core of the complaints I hear about corporations is the concept of "person-hood", where corporations enjoy nearly all the rights of being a person, and we must put a stop to this!  Perhaps the problems we are facing are not due to the fact that corporations are treated like people, but rather that they are not treated enough like people!  Have you ever heard of a corporation being sent to prison? Executed?  Publicly flogged?  Every time a corporation commits some misdeed, we hold one or more individuals in the corporation responsible, but not the corporation itself, even though it was the stock holders who put in the board of directors and said "make us money", and the board of directors in turn put in people who would do whatever it takes to make the money.  If you give a chimpanzee a gun and somebody gets shot, who is more at fault, the chimpanzee or the person who gave it the gun?  Since the stock holders gave it the gun (money), perhaps it is time to hold them accountable, or at least their money.

The only solution is to hold the corporation accountable just like we would a real person.  This means the corporate equivalent of  prison and executions; after all, when someone is murdered with a gun, we don't lock up just the finger that pulled the trigger, we lock up the whole person.  What would "holding the corporation accountable" look like?  Prison is a tough one, perhaps shutting down corporate operations entirely for a period of time, while requiring that the workers be given a full severance package (most companies could not manage to pay their bills for more than a few weeks or months while shut down, so the employees would be effectively laid off regardless).  The company would undoubtedly default on leases and mortgages without money coming in, its stock value would collapse and there would be many other consequences.  Of course if you were sent to prison, you would lose your job, default on your mortgage, and your credit rating and employability would collapse.  Your family might go hungry and suffer other consequences, so this is probably a good model.  Why should a corporation be treated any better?

Executions are easy, just confiscate the assets, dissolve shareholder equity, remove the board of directors and officers and start over.  The new stockholders could be the injured parties, or the new stock could be sold and the money put towards national debt, public works or something similar.   Alternatively we could simply dissolve the corporation and sell off all the assets (I hear the screams now - what about all the innocent workers), frankly, the workers are rarely that innocent, they usually have some idea about what is going on.  Even in the Enron scandals a while back, it appeared that a fair number of them had an idea something was wrong, but since they were also shareholders and the stock was going up, they were happy to go along for the ride.  If there had been a reason for them to worry that this may not have been entirely legitimate (such as the prospect of a corporate execution), perhaps they would have looked a little more closely and blown the whistle BEFORE things got out of hand.  More importantly, if there were a real threat of the corporation itself being held accountable for it's actions, perhaps share holders would take more of an interest in how it is being run (you can bet the institutional investors will), and elect a board of directors which would put into place more conservative people at the top, thereby avoiding the issue altogether.  The point here is that there must be serious consequences to the stock holders for allowing or encouraging their money to be used in a manner which is either illegal or shows reckless disregard for the safety and welfare of others.  Once this happens, they will be far more careful who they entrust with their money, and far more concerned about how their money is used.