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Corporate Personhood, Limited Liability, and Double Taxation

From my recent TLS post:

The politics of the left-oriented Occupy Wall Street (OWS) movement, like that of the right-oriented modern Tea Party movement, is not very well defined. But one of the things some of the OWS participants are calling for in their list of “demands” is an end to “corporate personhood.” In this they echo the views of left-libertarians who contend that state-chartered “corporations” are the source of grave social ills.

Some of these issues were recently debated on the pages of Roderick Long’s blog, in the comments to his post “Double Standard.” Left-libertarians who oppose incorporation, and usually also “capitalism,” argue that firms derive some great benefit from the state by the privilege of incorporation. The standard leftist critique of the corporation is the “concession” theory outlined by Robert Hessen in his seminal study In Defense of the Corporation (see a key excerpt from pp. 18-21). They argue that the state grants to corporations three features: entity status, perpetual duration, and limited liability to shareholders, all of which are artificial and would not exist absent state intervention. Left-libertarians maintain that these privileges grant corporations more power than they otherwise would have, which distorts the market, nay, society in general. This gives rise to more “hierarchy” and “authoritarianism” than would prevail in what Hans-Hermann Hoppe calls a private law society, and indeed, to “exploitation” of the workers by the bourgeoisie.

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