I'd settle for corporate jail time. No more profiting off illegal activity when the fine is less than profit. Nope, corporate jail. All operations have to stop for your sentence. No sales, no product development, no operations. Maybe an outside team of accountants can be allowed to run your books. This would effectively be a death sentence for many companies, but at least it mirrors the experience humans have to endure - loss of job, family loss of income, loss of ability to get future employment, etc.
Currently there is no downside for sociopathic behavior. Employment contracts guarantee they earn if the stock does well. If not they get a golden parachute on the way out.
If those that ran the company were actually responsible for what the company does, then this shit would not happen.
> Corporate Death Penalty is exactly what the country needs to recover from this nightmare
No. That's a bail-out for Meta. Just assess massive fines. That sidesteps the legal novelty of a "corporate death penalty," together with the fact that just revoking a charter doesn't actually do anything for assets. (Corporate death penalties done right are fines with extra steps. There are many more ways to do it wrong, e.g. thinking revoking a corporate charter means anything.)
The only people who should be arguing for a corporate death penalty right now are Meta's lawyers to distract from the possibility of the real penalty: massive fines.
I originally had a thing about "piercing the corporate veil" written, but after some consultation with Google's shit AI[0], it told me about the legal writ of "quo warranto"[1], which was apparently used as legal proceedings in the US to argue for the dissolution of a company.
So, in other words, we have a corporate death penalty, it just has a weird name, is mired in a bunch of weirdly English legal history, and it isn't very well used[2]. Also, the motion for the writ would have to be filed by Delaware's AG specifically.
Also, also, this is a nuclear option.
The primary hurdle of filing a quo warranto lawsuit against Facebook would be political, not procedural: Texas would really, really like to replace Delaware as the default state large enterprises incorporate in[3]. In fact, this process is already happening. Delaware made the mistake of enforcing their shareholder protection laws against Elon Musk's pay packet, so Texas is promising corporations a jurisdiction where shareholders donate their capital to the company for absolutely nothing in return except a token that they can pump the value of. In other words, Texas is a rotten borough that is stripping away all the ability for minority stakeholders to sue.
So if Delaware actually moves to revoke Facebook[4]'s charter, that might scare every other corporation out of Delaware - including the ones that aren't obvious scams. There's probably some way Delaware could hold existing corporations hostage there, but that would be an even more thermonuclear option.
That being said, I'm starting to wonder if the concept of a "nuclear option" is even meaningful in a world where "correctly deciding a shareholder rights case" destroys your reputation as a fair and neutral arbiter of those rights. Why bother keeping your powder dry if it's evaporating anyway? Go out with a bang and kill Facebook.
[0] Which if Google hadn't enshittified their traditional search index, I wouldn't have to use this.
[2] One may argue that the state doesn't use this very often because rapacious corporations happen to be useful to rapacious nation-states.
[3] Confusingly, they're calling this "DExit", which is annoying because we already use "Dexit" to refer to Pokemon Sword and Shield not shipping with all the Pokemon in it.
[4] It is always ethical to deadname corporations.
While that is certainly a topic worth pursuing, especially for anyone with a "corporations are people" argument, the challenge is the immediate vacuum afterwards, which is likely to attract copy-cats.
You might "execute" a corporation for proven anti-human actions, but that takes time. New corporations can crop up, maybe even involving some of the same prior executives, and the cycle starts again.
That's why the punishment should also have a sufficient deterrent effect. If the punishment can't sufficiently deter the behaviour, it should at least deter the capital enabling that behaviour at scale. In other words: void the stock.
Are you going to take away all of Zuckerberg's vast personal fortune, and all the other execs at Meta? What about all the folks who've wokred as engineer and product managers? Otherwise they're still making out like bandits.
The Sackler family ultimately had to pay $6.5b of ~$10b they took out of the Purdue Pharma in its last decade of control.
It'd be more than fair that Zuckerberg has to pay 65% of his personal wealth gained by preying on adolescent insecurities.
And anyone else who was in a leadership role at Meta.
The deterrent is not allowing "Oops, I created a bad social outcome, but I'm keeping the profit I made from it" to be a viable way of getting rich.
And at least plant some doubt in folks doing evil that retribution might claw back their wealth in the future.
1. Facebook knew its products were addictive.
2. They knew this addiction had negative effects on its users.
3. After knowing the above, they tried to make them more addictive to make more money.
Cigarette companies who as part of the 1998 MSA (1) are banned from television and radio advertising, (2) are banned from outdoor and transit ads, and (3) have print media, retail displays, and sponsorships federally regulated.
Most of these regulations apply to vapes, if they're owned by a legacy MSA cigarette company. With more regulation teed up for the new vape companies (i.e. JUUL youth marketing lawsuits).
If we treat social media companies like tobacco companies, I'd be perfectly happy.
$0'ing the shares would probably spread the punishment roughly proportionally with the harms they did. It's not a perfect solution (people who previously sold their equity would be missed), but better than most.
I feel like if you know that the previous company was executed for its crimes, its property auctioned off to the highest bidder, and its managers and executives thrown in prison, that THAT would have a chilling effect on other companies that might follow in their footsteps.
That has far reaching unintended consequences. Thousands of people out of jobs, investors out of money, etc. We’re not just talking fat cat shareholders. There are institutional investors, pension plans, 401k’s. Killing a company like Meta has a financial impact on virtually everyone in the country when the people we’re actually trying to punish are the slimeball CEO and his inner circle of executives.
Our system can’t bear something like a corporate death penalty. Maybe that’s another problem in and of itself. You won’t ever catch me advocating for a company like Meta - they are among the worst - but the solution can’t be one with the potential to kick off a 2008-style financial crisis. The cure can't be as painful as the disease.
That's not fair at all. I am not saying anything about too big to fail. My whole point is that most of the people who get punished by a corporate death penalty don't deserve it. And if you want to go around imposing that penalty then some things need to be structurally different to avoid all the collateral damage.
By all means, punish Zuckerberg and the executives who built the monster. Civil forfeiture is ok with me. Take their money, punish them, charge them with crimes if they broke the law. I don't care. I'm not going to advocate for them escaping accountability just because they are big. Force them to change their business model. Let them fail if they can't find a way to succeed legitimately. But understand that there's a difference between letting a business fail and killing it overnight.
Meta’s negative qualities have been obvious for a decade or more at this point. If you’ve joined them as an employee or invested in them then you knew what you were getting into.
> but the solution can’t be one with the potential to kick off a 2008-style financial crisis.
I don't think it would cause that much damage. If I understand right about floats and stuff, Meta is 2.13% of the S&P500, so NVIDIA (8%) could sneeze and cause more fallout to pension plans and so on than deleting Meta entirely. A sudden worldwide loss of access to content on Meta's servers would cause more secondary fallout than what happens to the markets.