If we eliminated the corporation status, all people would benefit, although most would argue against it for a while. Follow this line...
Right now, nearly all investment money comes through the channels of the stock market, private equity, angels or bank loans. I don't consider junior partnerships or mergers, etc. as "investment" because they are directly giving up control.
So, in today's market, you can't get your neighbor to invest because he's convinced it's not as safe as via the market, etc. His rationale for this is the tired mantra that local investment carries too much risk.
Well, sorry. If you lend me a lawn mower and it explodes because you rigged the fuel line wrong, should I not be allowed to sue you? The same goes for businesses. They should not get state passes to shield their assets (company or private) from negligence. (The obvious caveat is that liability cases would also need some sanity returned as well)
So, with this change in place, you say that businesses would flock to other countries. Ok, fine. Let's investigate that. Say they start leaving. That leaves holes in our needs so private individuals consider starting up their own business. Since our stock market would basically only be for bonds at this point, they have a much easier time courting local investment which now comes with far fewer strings. End result is they thrive because of the lowered overhead and deep pocket competition.
Their new enemy is the existing regulator structure. However, since the owner and all the investors are local, they are a more cohesive group to lobby back any truly oppressive rules (can you say OSHA?). As such, the legal environment is slowly migrated to what truly makes sense when free markets run both the economy and the rules.
Due to the higher profit margins and the local-ness, the investor now makes more money. This 'feature' will eventually become a burden that the owner wishes to end. He saves his pennies, buys them out and owns his business outright. Meanwhile, the investor has his money and profit to take to another local investment.
The only losers in this game are the big banks.
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