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Senator Warren introduces "Accountable Capitalism Act"


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Yes, the acronym is "ACA", but let's just skip over that, shall we?

 

Under the legislation, corporations with more than $1bn in annual revenue would be required to obtain a corporate charter from the federal government – and the document would mandate that companies not just consider the financial interests of shareholders.  Instead, businesses would have to consider all major corporate stakeholders – which could include workers, customers, and the cities and towns where those corporations operate.

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Large companies dedicated 93% of their earnings to shareholders between 2007 and 2016 – a shift from the early 1980s, when they sent less than half their revenue to shareholders and spent the rest on employees and other priorities, Warren said.

Troll level: god tier

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Didn't corporations used to have seek charters from the government? I seem to recall that fact.

 

Also how do they determine revenue? If this came into place (which it won't), I assume that magically somehow Apple would have annual revenue of $999 million. I completely agree with the spirit of this proposal, but I think the more realistic solution is to let them make whatever they want and then aggressively claw it back through higher taxes on dividends and other payouts.

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3 minutes ago, CitizenVectron said:

Didn't corporations used to have seek charters from the government? I seem to recall that fact.

 

Also how do they determine revenue? If this came into place (which it won't), I assume that magically somehow Apple would have annual revenue of $999 million. I completely agree with the spirit of this proposal, but I think the more realistic solution is to let them make whatever they want and then aggressively claw it back through higher taxes on dividends and other payouts.

There would be some hijinks I'm sure, but I doubt you could game the system that much. I know Amazon doesn't report the revenue it makes from what they sell on their store, so their reported revenue is dramatically lower than what most might consider their actual revenue, but for the big firms there's no way they could pretend revenue is less than $1B. Public companies already have a number of restrictions on how they have to report financials.

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Employees at large corporations would be able to elect at least 40% of the board of directors.

I believe they do something similar in Germany, and this does seem like the kind of change that would place very little actual burden on companies while also affecting a reasonable amount of change.

 

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The legislation would also require 75% of directors and shareholders to approve before a corporation could make political expenditures.

I'm curious how legal this would actually be. If you thought of corporations as a collection of people, it would make sense that you'd want some agreement from those people before spending money on behalf of those people. Legally though, corporations are singular entities, so putting this kind of requirement on their political expenditures (aka speech), seems unlikely to hold up in court. Still, I'm not really sure how it's decided now, so maybe there isn't really a problem. Certainly the above requirement to have workers represented on the board would help in this regard even without the 75% threshold.

 

 

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which could revoke a charter if a state attorney general requests it, and the office finds the firm has a history of egregious and repeated illegal conduct and has failed take action to correct it.

So this is probably the most difficult and problematic part of the whole thing. The ability to simply terminate a corporation at the will of the government is tricky. On the one hand, I'd say that it makes sense that a corporation that has a repeated history of illegal conduct should go away. However, it seems to me that maybe mechanism for this should be directly related to the punishment for those crimes. It's also difficult to imagine how this would work in practice. Let's say that a state AG decided to revoke the charter of a company like Nike or McDonalds or Google. What happens to that company in those states? Do they just get told they have X days to pack up, sell their assets, and leave? It's really hard to imagine exactly how this would work.

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37 minutes ago, TwinIon said:

So this is probably the most difficult and problematic part of the whole thing. The ability to simply terminate a corporation at the will of the government is tricky. On the one hand, I'd say that it makes sense that a corporation that has a repeated history of illegal conduct should go away. However, it seems to me that maybe mechanism for this should be directly related to the punishment for those crimes. It's also difficult to imagine how this would work in practice. Let's say that a state AG decided to revoke the charter of a company like Nike or McDonalds or Google. What happens to that company in those states? Do they just get told they have X days to pack up, sell their assets, and leave? It's really hard to imagine exactly how this would work.

NY just basically terminated Spectrum, they have 60 days to come up with a transition plan for leaving the state, so it seems they can already do this.

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Just now, PaladinSolo said:

NY just basically terminated Spectrum, they have 60 days to come up with a transition plan for leaving the state.

 

You're describing this way too definitively. I think the most recent action is the Charter CEO threatening to sue over the order. It seems very likely that what's next is everything getting paused for a good amount of time while this winds its way through litigation.

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33 minutes ago, Jason said:

 

You're describing this way too definitively. I think the most recent action is the Charter CEO threatening to sue over the order. It seems very likely that what's next is everything getting paused for a good amount of time while this winds its way through litigation.

The point was it can already happen, i would assume the company would always have the ability to sue to stop it to prevent the state from playing politics with it and arbitrarily kicking corporations out of states.

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