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All of those things have direct comparisons to the individual death penalty or other pre-existing laws.

A human could be put to death even if they have a family to support, so the workers argument is settled. The only issue is the matter of scale, but the death penalty is pretty rare to begin with, and I would expect a corporate death penalty have even stricter requirements.

They don't have to close a transnational, they can just force them to stop doing business in the country. They can close their US operations and ban their imports. We already have import bans on companies, countries, and products.

For subsidiaries, it would depends on how far up the chain the crime went. If Opel committed the crime but GM didn't know, Opel dies. If GM knew, GM dies. You could likely even spin off the "innocent" subsidiaries. If a husband commits a crime and the wife was not involved, the wife doesn't go to jail. If they both did it but their children were not involved, the children don't go to jail, they go to live with another set of parents.

They probably wouldn't pay the $15B fine if they weren't allowed to sell cars in the U.S. anymore..

The only issue is the matter of scale

You're not wrong, but this is also the same argument your parent post was making, namely that it will have a large scale negative effect on many regions.

I feel it's a bit strange to argue for corporate death penalty by comparing it to individual death penalty, given how controversial the individual death penalty is.

It should be, they both should be very controversial. But it easier to argue for a corporate death penalty than it is for a corporate "life in prison" because both of those things look exactly the same.

In this case, VW claims they didn't know either, it was those pesky employees that put it in there "for some reason", and any evidence to the contrary probably does not exist anymore if there was any. So VW would be innocent in your case?

>>The shareholders would still be richer and don't have to fear punishment

This is actually an interesting thought. What if they did have to fear punishment? Perhaps in the form of having a percentage of the settlement/regulatory fees passed to them via their brokerage accounts. A mechanism like this would mean that potentially shady/unethical corporate behavior would be reflected much more strongly in the stock price, since holding onto those stocks would carry risks beyond just the stock price temporarily going down during lawsuits.

It would also put immense pressure on corporations to not do shady shit.

Do you mean in amounts that could exceed the value of their shares? If so, then you're talking about changing a fundamental of corporations: limited liability. If you're not, then I don't see any difference in impact whether the corporation pays or the stockholders pay.

Limited liability doesn't protect you from the value of a stock being wiped out. Lehman Brothers was a limited liability corporation but anyone holding their stock during the bankruptcy was still stuck with worthless stock or debt that they couldn't recover in the proceedings. The current fine mechanisms are inadequate and can't properly realign incentives against breaking laws that carry civil penalties, especially in a case as blatant as VW's cheating.

Perhaps increase fees/taxes on "toxic" shares in companies that have broken significant laws with intent or maybe force these companies to settle by issuing diluting stock that goes to agencies responsible for cleaning up the mess. Or even tax revenue instead of profit on these toxic shares which would create a huge incentive, especially for executives and large stock holders.

The point is to tweak and realign incentives, it doesn't have to be passing on extreme financial liability to shareholders. Most investors can't take a huge hit on their portfolio like a company with tens or hundreds of billions of dollars of revenue can.

This is precisely what the fine is doing. Fifteen billion dollars of the market capitalization was wiped out, directly impacting shareholders. The stock has lost about 40% of its value since news of scandal broke.

You can argue it should be worse, but we don't need some special new mechanism. The fine can be anywhere from $1 to the the market capitalization+1 and the effects would then range from a slap on the wrist to bankruptcy and the loss of all equity in the company for shareholders.

>>>>The shareholders would still be richer and don't have to fear punishment >>This is actually an interesting thought. What if they did have to fear punishment?

What about people who may have invested in a fund that bought shares? Should the fund managers fear punishment? Should the people that bought into the fund be punished?

This is where the "punishment for those who benefit" gets complicated. It's hard to work out the people that should NOT be punished.

in other words- Too big to Fail? The equivalent of which in human terms is too rich to be prosecuted.

> It would kill entire cities in many places of the world. For example, Wolfsburg, the VW headquarter city has a population of ~100 000, the factory alone employs 57,000 people, ignoring administration and managment for VW in Wolfsburg.

Shutting down a company doesn't mean you destroy all of its assets. Factories or entire divisions could continue to run under new ownership. Just treat it as a Chapter 7 bankruptcy where the company owes the government more than the total of its assets.

> The shareholders would still be richer and don't have to fear punishment

Shareholders would lose out to the maximum extent allowed without piercing the corporate veil since their ownership stake in VW would become worthless.

> Also, what you are ignoring is that the US can't just come along and close a transnational or foreign company.

No, but they could close down the US subsidiary (Volkswagen Group of America) and take all assets that are in the US.

> Also, what about subsidaries? Does condé nast get closed if reddit violates the law? Does GM get closed if Opel cheats?

Easy, just sell them for whatever you can get for them.

So, corporations can just open (shell) subsidiaries to do their shady stuff for them and then the subsidiaries get declared bankrupt, which means the actual company survives and profits?

Just a thought on this - presumably some workers knew what the device did and others must have suspected. "Just following orders" is not widely seen as OK.

I am pretty sure most of the manufacturing workers had no idea. Probably a very, very small percentage of the employees knew about the device.

It was not even a device, it was a modified program. I highly doubt more than a dozen actual workers knew of it. How much management knew of it is hard to say.

Detailed analysis of the cheat:

https://www.youtube.com/watch?v=xZSU1FPDiao

There was no device for them to know about. Some engineers altered software that manipulated existing systems under guidance from management.

Good, point, I'd say cut of the head instead ? Basically fire the entire management.

I'm of the opinion we'd see far less corporate shenanigans if we were more willing to pierce the corporate veil and hold individuals accountable for their actions and orders.

Should you then hold individuals accountable for their own incompetence (rather than malice)?

Where do you draw the line between it being the corporation's fault and the individual?

(I suspect these questions are part of the reason it is the way it is currently)

There was no incompetence here, just malice.

Fires, jail and fines for the involved execs, but don't hurt the customers and shareholders and the rest of the employees.

The issue here is that no execs claim to be involved, and there are no documents to confirm nor deny it.

Involuntary manslaughter and criminal negligence already have plenty of case law around them. Yes, you can be prosecuted for being a menace to society whether you meant to or not.

In addition, everyone who got screwed by buying a VW is now doubly screwed when they're trying to find a shop to perform routine maintenance, as the factory repair shops have apparently been put out of business.