Why Do Corporations Get FREE Limited Liability Protection?

[eniwetok]

6. It's ALSO about bankruptcy....

Never heard of Chapter 7 liquidation? I only brought up shareholder clawbacks to illustrate a point that this IS another free protection.

But getting back to CH7... Here's a study from the Kansas City branch of the Federal Reserve that says between 1970 and 2008 the mean creditor recovery rate actually is only about 39%...

http://www.kc.frb.org/publicat/econrev/pdf/12q2Mora.pdf

Here are some mean recovery rates by industry
Agriculture, Forestry and Fishing 39.9%
Mining 50.8%
Construction 28.7%
Manufacturing 43.7%
Transportation 32.7%
Communications 39.6%
Utilities 57.5%

SO WHY IS THIS PROTECTION OF PRIVATE ASSETS PROVIDED FOR FREE INSTEAD OF AS INSURANCE FROM THE PRIVATE SECTOR? This is a GIFT from We The People... and we should explore WHY we give it... and what price do we expect back in return.


As for intellectual property monopolies... I support them to a point stated in the Constitution. It's right there in Art 1 sec 8 "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;" This would SEEM to limit profits to some reasonable level that's just enough to promote progress. But that's another matter.

BUT YOU'RE MISSING THE POINT... which is right there in the OP... something you seem determined NOT to discuss...

The Right wants us to believe that the rich make all their money on their own and who can dispute that hard work and brilliant ideas don't give one an edge in a competitive market? But beneath the surface there are plenty of government freebies that I'd argue vastly contribute to the creation of the uber-rich... freebies like intellectual property monopolies, copyrights, and trademarks... and doesn't Trump claim his "brand" is worth 3 billion?


Then there's the question of

WHY DON'T THE DEMS MAKE THIS ARGUMENT IN DEFENSE OF PROGRESSIVE TAXATION? I know Obama got beat up for his "you didn't make that" comment. But still this IS a legitimate and potentially vital narrative in defending high progressive tax rates.