[InvisibleUp]

I find it a touch strange, in the abstract, that a corporation being public is a bad thing. On paper it should be a good thing; being publicly owned should mean that your corporation has turned from a private business venture into effectively public infrastructure that's impossible to boycott and depended on to some extent by everybody. As a result, financial statements should be (and are) public and transparent, and the company should be able to be externally steered via regular elections in a manner that benefits the public and not just its founders.

The issue really lies in the fact that the (long-term, majority) shareholders aren't much, if at all, related to the customers or employees of the business, but first the founders, and then parties who are merely interested in rising stock prices and dividends. It feels like the solution here ought to somehow desegregate voting rights from how many shares are owned, instead of dismantling the concept of public ownership entirely. (Or, perhaps, allow the general public to proxy vote via their 401(k) index funds?)

(There's also strange situations like Google/Alphabet, which is publicly owned, but effectively does not allow shareholders to vote on anything.)

[faidit]

The wealthiest 10% of Americans own like 90% of stocks, and the top 1% own 50%. While the poorest 50% of the population own about 1% of the stock market.

So "publicly" traded (the term public ownership can be confusing because it can also mean state control) just means it's open for the elite to invest in.

[rmunn]

Could you link to how that measurement was taken? Because I very much want to know whether it counts things like mutual funds, or whether it only measures direct ownership of stocks. E.g. I have a bunch (though not all) of my retirement savings in an index fund that owns partial shares of the top 500 US companies (as listed by Standard & Poor's). So depending on how that S&P 500 fund is measured in those statistics, I either own shares in the top 500 companies, or I'm counted as not owning any shares. The latter would produce a very misleading statistic, because I am very much not the only person who invests in the stock market via mutual funds.

So a link would be much appreciated, in order to judge the quality of the info. As it is, I'm skeptical that the info is accurate, precisely because mutual funds are so wildly popular among the middle-class people I know (none of whom are in the top 10%, though most of them would likely be in the top 50%).

[jampekka]

These figures seem to include ownership of mutual funds.

https://fred.stlouisfed.org/series/WFRBST01122

[nish__]

It's amazing to me how many people don't get this.

[Gormo]

Well, considering that it doesn't seem to be an accurate statement, it shouldn't be so amazing that people don't "get" it.

By far, the largest shareholders in most publicly-traded firms are "institutional investors", but those are themselves in turn usually acting as middlemen managing mutual funds, most of which consist of ordinary folks' 401(k) plans and pensions.

[nish__]

What? "Doesn't seem to be an accurate statement"? What part? Those numbers are actually conservative. According to Yahoo Finance[0], it's actually 93% of the stock market is owned by the wealthiest 10% of American households. And the bottom 50% of Americans own ~1%. You "seem" to be mistaken and you're talking out of your ass.

[0] https://finance.yahoo.com/news/wealthiest-10-americans-own-9...

[Gormo]

The article you're citing doesn't link to its sources, but seems to be talking about direct stock ownership by households, and not explicitly stating how it's accounting for investment funds.

[nish__]

I think it's accounting for indirect ownership as well. That would be very misleading and irresponsible reporting if it weren't.

[twoodfin]

“Just”? As if there aren’t pension funds and 401(k)s and IRAs serving >100 million Americans via investment in public companies?

“Open for the elite” how?

[sfn42]

Have you considered the possibility that 401ks and pension funds etc are included in those numbers?

Open for the elite in the way that everyone else don't have enough money to matter.

The richest people are so much richer than everyone else that there's no comparison. You could grab a million average people off the street and all of you combined probably wouldn't be richer than Jeff Bezos. Think about that. This one guy is wealthier than a million other people combined, literally wealthier than an entire small country or large city, and he's not alone. There's more of them.

Those guys rule the world, everyone else are passengers.

[tapland]

:)

You still don’t have a say and the investor is also the customer. How is it democracy or keeping companies to being good for society.

[breppp]

Not sure what does that mean. Americans poor and wealthy are in the top 10% of the world wealthiest and own a huge part of the world stock value accordingly.

That's simply capitalism, money is spread unevenly across everyone, that does not make everyone an elite

[tapland]

So it’s more like the top 0.001% who have the voting majority in this wonderful democratic system we all have our life savings dumped into.

What was your attempted point? Or did you not understand the issue that was brought up?

[throwaway68108]

Is that a bad thing? Why would I want someone who can't even manage their own money to manage my life savings? If anything I'd expect a company where the decisions are in the hands of 99% John Smiths and 1% Warren Buffets to be even more short sighted, *especially* when it comes to splurging on dividends.

[safety1st]

"The major reason is they are a private company with good business..."

This is unquestionably, undoubtedly incorrect. It is a really low information meme that's racing around the Internet right now. If you want a contemporary counterexample take a look at NASCAR. They're also not publicly traded, they're family owned, yet they are abusive toward drivers, teams and fans, and they're gradually ruining the sport that made them rich. We know all of this because it got so bad Michael Jordan decided to sue them and there's a ton of information coming out in discovery at the moment.

The real reason Valve are being the "good guys" at the moment (not really, but yes they're doing some amazing stuff for Linux) is because they feel threatened by Windows and Microsoft, they perceive a long term competitive threat to Steam. Competition makes businesses both private and public work for your dollar. The US economy has been characterized by a decrease in competition and an increase in monopolies for decades now which is the root of many price hikes and anti-consumer practices.

[int_19h]

It's not that being private guarantees that the company will behave well. But it does make it possible.

[AuthAuth]

public companies are not forced to maximize shareholder value contrary to the popular meme that always gets thrown around.

[philip-b]

>The real reason Valve are being the "good guys" at the moment

Ok, but this “at the moment” has lasted at least since 2011. Basically my whole adult life Valve gas been a pretty great company delivering value and not being annoying.

[xethos]

> The real reason Valve are being the "good guys" at the moment

Yep. Valve is seen as virtuous because Microsoft is greedy and the default Windows 11 install is generally viewed as a tire-fire of an OS

Are they doing good things for Linux? Absolutely. As a long-time Linux user I am over the moon that we are where we are. But the general populaton only gives a shit because Microsoft is abusive.

[palata]

> But the general populaton only gives a shit because Microsoft is abusive.

I hear that for every major Windows release. And after 6 months everybody is fine with it.

[ahartmetz]

It seems different this time. Windows is worse and Linux is better than at previous defenestration opportunities.

[jszymborski]

> ...they're family owned

Well that's your problem there.

I do overall agree that Valve is only situationally the good guy here, but they do also have a sustainable approach to business and growth which I think helps this.

[whatshisface]

Companies doing things for the common good because they feel threatened by competiton is the whole idea behind Capitalism.

[palata]

Except when Capitalism has favoured monopolies for decades and is actually closer to Feodalism.

[z3t4]

Monopolies need to be restricted by regulations. In micro economics there is a term marginal cost, and economy of scale. In the software as a service era, the cost of serving one extra customer is minimal, so it make economic sense for such companies to grow infinitely. This is why our current system do not work. As the best strategy is to become as big as possible and capture the entire market.

[safety1st]

There is a bit of a debate about what to call the American economic system these days, but I think we should all agree it's not a capitalist one. It's not one that Adam Smith would look at, approve, and say oh yeah baby that's exactly what I was writing about in Wealth of Nations.

It looks a lot closer to the economic policies of the most successful fascist regimes - the best term for modern American economics might be "democratic fascist." There is a facade of a market economy, but there's heavy intervention to privilege not just domestic businesses, but a specific set of big ones that have close ties to the ruling party. This is not much different from how Hitler and Mussolini approached economic policy. Basically have your system revolve around private ownership, pretend to have a market economy but actually make very centralized decisions and execute them through a small number of private oligarchs you're buddies with. The uniquely American flavor is that there are two parties which do this instead of one (but three would be unimaginable), and you can choose which pack of bandits you signal loyalty to without being executed.

[palata]

Very insightful, thanks for that comment!

I find it interesting that this "feature" of the US (having those big monopolies) is often mentioned as a "weakness" of e.g. Europe, where companies cannot get as big (I guess partly due to regulations).

And in turn, when US companies "lose" against, say, Chinese companies, they will say it's because they get help from their authoritarian system (through the government). Which is a bit ironic given that the US monopolies do exactly that to the rest of the western world, right?

[simonh]

On the spectrum of authoritarian oligarchy of the type you describe, from 0 (liberal democracy with well regulated free market capitalism) to 100 (totalitarian oligarchy), where would you put: The USA; The average EU country; Russia.

[emilecantin]

I think there should perhaps be a law that any corporation automatically has a new class of un-tradeable VOTING shares, worth 50% of the overall vote, held by the employees. Everybody with an employment contract with this company is entitled to 1 vote, no more, no less; whether they're the janitor or the CEO.

Employees of a company are the ones who are the most affected by the company's decisions, it's only fair that they have a say.

[bravoetch]

How much is a vote worth in dollars? Because there would be a market for those votes, not just a spot market for dollars or internal market using vacation days, it would be reflected in salary and benefits and company policy etc.

[echoangle]

Couldn’t you just make the voting anonymous to make sure that buying votes isn’t possible? Why wouldn’t I just take your money and still vote however I like?

[chongli]

A law like this just means getting full time employment becomes that much more difficult and the vast majority of people working for a company will be non-voting contractors without benefits. The existing employees would even vote for changes that make full time hiring more difficult in order to avoid diluting their own votes.

[emilecantin]

It would obviously need to be accompanied with rigorous enforcement of employee classification. I know there would be a bunch of possible ways to game this, so there are a lot of other rules we'd need to add but I didn't want to make my comment too long.

Also, I wouldn't necessarily make a distinction between the full-time employees vs the part-time ones.

[chongli]

I think you’ll find that won’t actually work in practice. Many contract workers are not independent freelancers but actually employees of a different company who contracts the work out as a whole.

For example, a courier company like UPS employs all of its workers but the packages it delivers are for other companies who contract with UPS to do the work. If you force all businesses to employ their own couriers then UPS can’t even exist as a company and small businesses that depend on courier services would simply be unable to function at all.

[talideon]

You can at least in part blame Milton Friedman for this mess. His reframing of ficudiary duty as profit maximisation in his "shareholder theory" has done a tremendous amount of damage. The wariness of people when it comes to public companies is a direct consequence of this.

[Barrin92]

>and the company should be able to be externally steered via regular elections in a manner that benefits the public and not just its founders.

Why would anyone believe that this means an organization is well run, or to everyone's benefit? Here in Germany we're notoriously unfriendly to public companies, most of the (well functioning) Mittelstand is private and family owned. And I pray to god it stays that way because I'd rather trust a company whose leaders have their family name and reputation staked on it for the next three generations than I do the amorphous blob called "the public". As Kierkegaard said, in the crowd nobody is responsible.

If you want to see what happens under public ownership visit a public bathroom. I don't want anything externally steered by nobody in particular, I want something steered by a handful of people with names and addresses.

[flaminHotSpeedo]

My understanding of the contemporary argument against publicly traded companies, though I'm not completely convinced of them personally, are that the fiduciary obligations inevitably drive those bad behaviors, and/or that shareholders often demand short term returns at the expense of long term value.

As far as "fixing" the problem, I think it would be important to expand voters' influence over the company in addition to voting changes like you described. I don't know how to make it feasible, but IMO voters should be able to influence or directly decide much lower level business decisions than they currently do

[dboreham]

It's a common pattern. If you're in their service area compare both the food served by, and the employment practices of In-n-out Burger (private) vs McDonald's (public).

[mcny]

> (There's also strange situations like Google/Alphabet, which is publicly owned, but effectively does not allow shareholders to vote on anything.)

You mean the special class B shares that gives 10 votes per share, right? It isn't just Google though. Facebook and Snapchat also do the same thing, iirc?

[avadodin]

Share classes can be very varied(such as preferred shares that get what's left after bond debt is paid off on bankruptcy) but generally what he's proposing(a coop-style one-head-one-vote class) is not common. Not sure if it's legal for US corporations or not(I could swear it is but in any case it's exceedingly rare). The usual principle is one-share-one-vote.

[tomrod]

And, famously, Berkshire Hathaway

[lvass]

>On paper it should be a good thing

Not really. Most people have terribly low time preference. Democracy for example is a very bad idea when you account for that (read Hoppe for a detailed explanation). Public company ownership is much better because it doesn't suffer from one vote per person, but still susceptible to much of the same management problems, specially in a society that already favors lower time preference by other means.

[avadodin]

I do not deeply disagree with your statement but I do not see the two as exclusive.

I think distributed public ownership placed in a corporation ruled as proposed here provides a chance to harvest residual good decisions from a citizen/shareholder who cares as opposed to having a single decision derived from some other issue a majority of citizens favor.

Unless you're talking about doing away with any kind of voting but Communism doesn't exactly have a stellar track record.

[guelo]

fwiw, Hoppe has become a darling of the extremist authoritarian "alt-right" (curtis yarvin, etc) but has been rejected by more mainstrean thinkers including most libertarian factions.

[taftster]

Yes, exactly. It's kind of a wink-wink nudge-nudge at this point. A company citing "public good" under the guise of "shareholder value" is not actually supporting the public good at all.

Not that I condone capitalism, or socialism, or communism, or fascism, or any ism for that matter. Ism's in my opinion are not good. A person should not believe in an ism, he should believe in himself.

But a private company, at this point, can arguably affect the greater good just as much as a public company. The rich are getting richer, and the corporate model is just there to support that transfer of wealth.