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Comment by couchand | Hacker News Reader

> exempt from the normal responsibilities of debts and liabilities

I'm sorry, what are you talking about?

https://www.investopedia.com/terms/l/limitedliability.asp

They are ubiquitous today, but at one time each limited liability corporation was individually created by a unique law passed by the legislature, for a specific purpose--often infrastructure projects--and with a fixed lifetime unless renewed again by another law.

Please show me where in that citation is any reference to an LLC being "exempt from the normal responsibilities of debts and liabilities". As the discussion there indicates, limited liability is a totally normal thing, and despite the name it applies to other corporate structures, notably C and S corporations. So what exactly is the "normal" that you claim LLCs deviate from?

The article referenced conflates public companies and private ones. Public companies do have liability restrictions, but notably (in the U.S.) ownership is explicitly reported. LLC’s are private companies, but in many states their ownership can be masked or wholly secret.

In my experience masking ownership or allowing secret ownership of LLC’s is a net loss for society as a whole. There is a large surface area where ownership is not being masked for a good reason, but is being done as deliberate deception.

It's normal now, and as you mention "limited liability" now applies to all corporations. As grandparent poster mentioned, however, this sort of capability originally required a special dispensation from the crown (or an act of Congress). Some examples are the "East India Tea Company", which was effectively one of the colonial arms of the British government.

At some point we decided that this sort of thing should be available for everyone with the money and time to file the appropriate paperwork. It's really odd though since you can avoid things through incorporation that you can't avoid through other means -- debts that would carry through bankruptcy, and even many criminal issues (at least if they don't rise to the level to pierce the corporate veil).

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