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Why I Pirate - An Open Letter to Content Creators

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tranglos:
Are you aware of any place in the western world where a business is required at all times to maximize profit under penalty of law? I've been searching for such a thing for a long time (more out of personal curiosity than anything else) and I haven't ever been able to identify such a jurisdiction or law. Not surprising when you're as ignorant about international business law as I am. ;D

Any input would be greatly appreciated.  :)
-40hz (March 08, 2012, 02:24 PM)
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Canadian author, professor at University of British Columbia Faculty of Law, has a fantastic (IMO) short book "The Corporation" (there's a 3 hour documentary film to go with it), where he does make that claim. In fact it is fundamental for his thesis. The thrust of the book is to show that the pathological behaviors of big corporations (of which he gives good examples, but you don't need to look far) do not happen because their CEOs are sociopaths. Rather, he says the corporation itself behaves as a sociopath since the law requires that profit be its primary goal and motivation.

If a person behaves like that, it's generally regarded as evil. We'd say a person like that would "sell their mother down the river" and it's never a good thing. Somehow the same behavior becomes a virtue when a corporation does it. Bakan shows plenty of examples where "shareholder value" trumps any ethical or moral considerations, like when the bosses at GM decided that they would rather pay compensation to victims of exploding gas tanks in Chevy Malibus (that was back in the 70s) than fix the design flaw, because fixing it would be much more expensive. They actually used an equation:

500 (estimated) fatalities x $200,000 per fatality / 41,000,000 cars = $2,40 per car.

This is what it cost GM to pay compensation, and apparently it was less costly than fixing the issue. Again, if a human being made a calculation like this, it would be considered very nearly psychopatic. For a corporation it's all in a day's work.

My personal favorite example (not from the book) is this quote from CEO of Roche Korea:

"We are not in business to save lives, but to make money. Saving lives is not our business."
http://naturalhealthnews.blogspot.com/2009/01/not-in-business-of-saving-lives.html

In the book, Bakan lists a behaviors that are understood to be indicators of clinical psychopathy (utter disregard for the well-being of others, inability to assume responsibility, there's a whole list of markers) and demonstrates how your typical corporation fits all of them. I

think the book is quite solid, though I am not a lawyer an the book itself is not lawyerly, either. But IMO it does lay a very solid foundation for a new way of thinking about corporate behavior, and the premise is the idea that yes, corporations are required to increase value for shareholders before anything else. I highly recommend the film as well.

I would also add that something does not have to be a written law in order to be a de-facto standard and expected behavior. There is no law anywhere that says corporations are persons, and yet this is what's being argued all the time. There was a case a few years ago where a court decided a company had a right to lie to its customers since it was a freedom of speech issue. (No link at hand, sorry). The history of the "corporate personhood" idea is traced in another book I highly recommend, "Unequal protection" by Thom Hartmann. He digs in historical court records and finds out it was a court clerk that overinterpreted/misinterpreted a judge's ruling. The judge was already on his deathbed by then, and the clerk was a friend of big railroad corps at the time. No-one contested what he wrote (since it was so convenient for the interested parties) and the idea stuck, although it is not and never was a law.

Innuendo:
Lots of great stuff snipped-tranglos (March 11, 2012, 08:53 AM)
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What a sobering post, tranglos. What is truly worthy of thought are not the examples you gave, but the hundreds (thousands?) of decisions like that corporations have made that have been carefully kept out of the public eye.

40hz:
and the premise is the idea that yes, corporations are required to increase value for shareholders before anything else.
-tranglos (March 11, 2012, 08:53 AM)
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Possibly. (I still don't see where it says that in the law itself BTW.) Most of the argument is by extrapolation and assertion that "this is so" rather than actual wording in the law. And in this particular context it borders on applying reductio ad absurdum to the legal concept of "fiduciary responsibility." In short, a great way of thinking about it - except that's not what the law actually says - even if some people running some corporations might think so.

The reason this distinction is important is because it still doesn't give a business or corporation carte blanche to break the law in the name of maximizing profit. The judicial system has been very clear about that in numerous cases.

If corporations were always required to pursue maximization of profit under law, it would be allowed as an absolute defense in court , much like truth is defense against the charge of libel.

Just to be clear on US law, I bounced it off an attorney. She said it was a common misunderstanding of what the law requires of corporations and fiduciaries. "Just because most people might think the same way about something doesn't make it the law," she said. "As many people learn the hard way when they land in court."
 :)

Renegade:
What a sobering post...
-Innuendo (March 11, 2012, 10:49 AM)
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I am sooo tempted to interject some very not-sober demagoguery, but I shall refrain. ;)

Carol Haynes:
tranglos - I agree. Brilliant film by the way (if incredibly scary).

To prove the point you only have to look at businesses that deliberately target children with products that are not only not good for them but harmful.

Famous case in the UK where MacDonalds got its arse whipped for selling unhealthy food and marketing it directly at children. Two people who objected published a pamphlet. It was MacDonalds policy to sue anybody who criticised them at that time and they used the law without mercy. The case dragged on for years but eventually the two protesters won the substantive points and MacDonalds no long sue people in the UK for criticism any more (they realised how bloody minded the Brits were). It didn't stop them, however, using illegal methods to undermine protest groups, attempted bribery, coercion and outright threats to try to kill the case.

See http://www.mcspotlight.org/case/trial/story.html for a summary of the full story - but also get the film MacLibel and see what went on!

Incidentally MacDonalds knew the health risks and decided they were worth taking (with other peoples' children) because they were making a profit - after the various law suits they introduced a 'healthier' range of food - including salads that had even higher fat and slat content than the burgers and fries!

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