Comment by Gpetrium | Hacker News Reader

Comment by Gpetrium | Hacker News Reader

Parent Full thread

I think there is a fine line a lot of major companies have to go through to ensure they are not inadvertently doing fiscal fraud (and other types of fraud) while maximizing their main goal, which tends to be profit maximization. If the government punishes too hardly, individuals and corporations are more likely to shy away from that market due to increase in operations cost (E.g. More lawyers + accountants) and implicit risks. Customers would also move away from those products and services if the cost became too high.

Part of the governments job is to ensure that they react to potential loopholes faster, decreasing the competitive advantage that a non-conforming organization may have. A harsher punishment may even put some companies out of business, impacting unemployment rates, supply chains, medium-long term government revenue and the services they provide.

How would you go about increasing the punishment while considering the possibility that the corporation inadvertently did that? Would you punish larger companies more harshly? How would that impact the market place?

Corporations do everything inadvertently. They're not sentient, they're a pile of emergent behaviors driven by incentives.

You increase the punishment because they inadvertently did it. Then maybe you'll get an incentive structure that prevents it next time.

I couldn't agree more. This is something that no one, from any polical side, right or left or republican or democrat or whoever in whatever country, says enough. Companies are indeed considered as real entities whereas they are just emergent structures which behavior comes from decisions made by real humans. And I truly believe that those real humans should be trialed and sentenced more or at least as much as the company they are working for in cases of fiscal fraud. And this is not the case now, the company shielding them from the consequences of their individual actions. For companies, the justice system works quite well (just like here, even with extraterritoriality and fiscal paradise), nations can manage to apply the law to them. But the responsibility of the individuals in the same legal cases is often forgotten. Take the Google example : even if you talk of "fiscal optimization" to give a nice appearance to those actions, some individuals in Google crossed the line and knew it perfectly. And it is true that Google, as a structure, is ok with it ('don't do evil' does not apply when it comes to maximizing profits). But those people at Google who crossed the line will never appear in court, nor the ones having validated their work (probably the higher management), which is a shame in my opinion. It happens that a company break the law, but it never does it alone : it is people who instruct it to do so. To see my point, look at England at the moment : if a ruler of a country decides to break the law, is it the country that is responsible or the leader ? My view is that it is both and both should be prosecuted by the individuals impacted.

Companies aren't different from people. Everyone responds to incentives.

they're a pile of emergent behaviors driven by incentives

Never thought about it that way, thanks for the insight!

Reply on news.ycombinator.com