[8note]

I'll believe you that capital is the bigger risk taker when limited liability is revoked.

or if we change bankruptcy such that labour is paid out rather than creditors.

laws are setup to reduce and limit the risk for capital, and capital can hedge its risks where labour cannot. Generally nobody is able to work to full time jobs

[liquid_thyme]

Um, Capital sits at the bottom of the payment waterfall, labor, suppliers, lenders, creditors all have priority claims. Capital returns are vastly more volatile than labor compensation. Most startups burn and die, but employees still get paid (keeping illegal practices aside). Capital bears most of the uncertainty that labor doesn't.

To argue your point, the strongest argument is that labor cannot easily diversify or easily re-train for new sectors. But there aren't entire job sectors being wiped out with any kind of regularity or high frequency. Mostly people take skills from one job into another.

And speaking more about the US, social safety nets (not arguing that they're perfect) have some role to play when labor faces downsides. There is no "unemployment" for a company (again I'm talking about average businesses without cherry picking the too big to fail examples - which are a tiny percentage when looking at the number of small/medium/large businesses that operate around the world).