Subject:
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Re: Finally some church/state mingling that I can really get behind!
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Newsgroups:
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lugnet.off-topic.debate
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Date:
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Thu, 14 Aug 2003 12:39:26 GMT
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Viewed:
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408 times
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Good points, but like most fictions in life, we stick to entity status for
corporations because it largely works. For every bad corporation that makes the
news, there are handfuls of good ones that promote employee welfare and good
corporate citizenship.
Realistically, the sole purpose for a corporation to exist is to generate wealth
for stockholders. That’s the legal purpose behind the establishment of a
corporation; they’re in violation of their fiduciary duty to stockholders to do
anything but attempt to create wealth. So it’s sort of like faulting an animal
for eating and reproducing--to do aught else goes against their very nature.
The purpose of moving company headquarters offshore for many companies is to
avoid paying taxes on the same profits to multiple countries. Say you own a
corporation that has two divisions, one does business in Germany and one in the
US. The headquarters are in the US. The German division pays German taxes; the
US division pays US taxes. Then when the business moves the German division
profits to its central headquarters, they’re taxed again by the US. Now take
the same company, same divisions, headquartered in the Cayman Islands. German
division pays German taxes; US division pays US taxes. Then profits pay Cayman
Island taxes--a huge tax savings.
Recently a tool company--Stanley I believe--was attempting to move its HQ
offshore. They were shamed into keeping it in the US. Some months later, they
laid off several hundred workers--the price of keeping HQ in the US.
I do agree with limited liability as well. The company that I work for (very
small computer consulting company) wouldn’t be in business without a limitation
on liability...
But then you take a (expletive referring to legitimacy of birth) like Ken Lay
from Enron. Justice isn’t served until his lifestyle is devastated to try to
pay off some of the employees and stockholders that he ripped off. Criminal
wrongdoing by a corporation should come down on the heads of those who
perpetrate it, limited liability or no.
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