spun On Corporations (Slashdot)

Corporations used to have severe limits and no rights. Corporations were created by the European Monarchies when they realized that the new merchant class had supplanted the nobility as the power they must court. They kings of european states knew they would need financial help to realize their dreams of empire, and that help could only come from the merchants.

But the monarchs knew that a corporation was essentially a landless, peasantless fiefdom. Corporations would have enormous power, so in exchange for the limited liability which would attract investors to risky, long term projects like colonization, they would say that corporations could only do the business for which they were chartered, in the region their charter covered. The East India company could neither trade in the Americas nor grow crops in the East Indies. And corporations were limited to the lifespan of the original founders: when the last of them had died or sold their shares, the corporation would be dissolved.

Finally, a corporation had no legal rights as a person seperate from its officers. This was one of the biggest limitations, and one of the last to go. But money buys power, and over time the concentration of money available to corporations allowed them to buy politicians who would enact legeslation expanding their power, allowing them to make more money and buy more laws in a vicious cycle.

Now, a corporation has always been able to own things, and to owe money. Seperating ownership and liability was the whole purpose of corporations and the thing that made them different from partnerships. But in exchange for that, severe limits were originally placed on what they could do. Now those limits have been erased and corporations have all the benefits with none of the societal responsibilities.