We should be subsiding more things that are in the public interest
Very much agreed! But…
programs that benefit the public should never be run by for-profit corporations.
I wouldn’t go that far. In fact, I would actually go so far as to say kind of the opposite: that all “corporations,” including “for-profit” ones, should be required to act in the public interest, as originally intended, and that any organization that doesn’t want to be subject to those sorts of conditions is perfectly free to remain a full-liability general partnership instead of incorporating. Incorporation is a privilege intended to be granted in exchange for public benefit, and we need to get back to that instead of continuing to let the courts treat it as an entitlement.
I get your point, but I have trouble understanding how acting in the public interest and charging over operating costs can be compatible, especially in public service areas like hospitals/medicine and education.
Here’s the part that should’ve answered your question:
Initially, the privilege of incorporation was granted selectively to enable activities that benefited the public, such as construction of roads or canals. Enabling shareholders to profit was seen as a means to that end. The states also imposed conditions (some of which remain on the books, though unused) like these:
Corporate charters (licenses to exist) were granted for a limited time and could be revoked promptly for violating laws.
Corporations could engage only in activities necessary to fulfill their chartered purpose.
Corporations could not own stock in other corporations nor own any property that was not essential to fulfilling their chartered purpose.
Corporations were often terminated if they exceeded their authority or caused public harm.
Owners and managers were responsible for criminal acts committed on the job.
Corporations could not make any political or charitable contributions nor spend money to influence law-making.
“Enabling shareholders to profit was seen as a means to that end.”
Right, that’s the part I take issue with. Why is there a profit on a public good?
I agree with all of the restrictions in place, but those have gotten weaker over time, when they should’ve gotten more restrictive. The problem with allowing them to profit is that over time, the profit gives them more bargaining power which allows them to erode the oversight and avoid all consequences for breaking the regulations.
Very much agreed! But…
I wouldn’t go that far. In fact, I would actually go so far as to say kind of the opposite: that all “corporations,” including “for-profit” ones, should be required to act in the public interest, as originally intended, and that any organization that doesn’t want to be subject to those sorts of conditions is perfectly free to remain a full-liability general partnership instead of incorporating. Incorporation is a privilege intended to be granted in exchange for public benefit, and we need to get back to that instead of continuing to let the courts treat it as an entitlement.
I get your point, but I have trouble understanding how acting in the public interest and charging over operating costs can be compatible, especially in public service areas like hospitals/medicine and education.
Did you read the article I linked?
Here’s the part that should’ve answered your question:
“Enabling shareholders to profit was seen as a means to that end.”
Right, that’s the part I take issue with. Why is there a profit on a public good?
I agree with all of the restrictions in place, but those have gotten weaker over time, when they should’ve gotten more restrictive. The problem with allowing them to profit is that over time, the profit gives them more bargaining power which allows them to erode the oversight and avoid all consequences for breaking the regulations.