Should Corporations Go To Jail?

Whenever the subject of whether or not corporations are people comes-up in conversation, the most likely answer is “No! Are you kidding?” The conversation inevitably winds around to why corporations have rights that US citizens do not (they do, by the way) and if corporations are going to be deemed people, then why shouldn’t they go to jail just like people can. I’m the sort who doesn’t think it’s a matter of “if” (it’s pretty clear, to me, that they should) but how, exactly. So, here’s how it could work…

First, why shouldn’t corporations go to jail for the same kind of dangerous, anti-social behaviors that individuals can? Corporations are chartered from the government for the express purpose of serving society — really, read about it here. There is a history.

There’s no reason why corporations shouldn’t suffer for their actions and, indeed, there are already mechanisms to penalize organizations for wrong-doings (even if these penalties are often laughably light). If they can benefit from society, they can contribute to it. Already, leaders in corporations can go to jail for grievous activities. And, a company can face fines, limitations, and other consequences of its actions — just not the ultimate consequences: incarceration (or death, for that matter*).

Second, the most common rebuttal to the idea of companies going to jail is: “It couldn’t work! How could a company be put in jail?”

Consider what already happens to a sole proprietorship when that sole proprietor is found guilty of a crime that deserves a jail sentence — they go to jail and their company is crippled and cannot function without them. So, this happens already, just with small companies. Sending other forms of corporations to jail wouldn’t be that different.

When a person goes to jail, what happens? Their freedom to operate in society is suspended. They lose the ability to manage their affairs outside (buy or sell things, manage their accounts, enjoy the freedoms that society grants, etc.). A corporation in jail would lose these rights, as well: their accounts would be frozen and inactive, their assets secured but insolvent, their debts as well as their revenues frozen, and the vast majority of their activities halted. In other words, it would be a big mess — possibly a catastrophic one… just like…