ExxonMobil:Private Empire

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Jonesthe Spy
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ExxonMobil:Private Empire

Postby Jonesthe Spy » Wed May 02, 2012 9:09 pm UTC

“Presidents come and go; Exxon doesn’t come and go.” - Former ExxonMobil CEO Lee Raymond, capturing in a nutshell why we need to drastically reduce corporate power and influence.

On the heels of the big fat thread Ayn Rand thread inspired by strip 1049, here's a piece about one of the biggest, most powerful corporations in the world and how it behaves. Very scary in my humble opinion. Partnerships with Third World dictators, funding a propaganda war against the climate science that said we need to reduce the use of fossil fuels, ignoring SEC regulations, and completely protected from being held accountable by its vast wealth, annual revenues being larger than most nations.

http://www.npr.org/2012/05/02/151842205/exxonmobil-a-private-empire-on-the-world-stage

I highly recommend listening to the whole piece if you can, not just checking out the written synopsis.

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Re: ExxonMobil:Private Empire

Postby nitePhyyre » Thu May 03, 2012 5:46 am UTC

But as the company attacked global warming publicly, Coll says, geologists working within ExxonMobil were examining how a warmer Earth — resulting from global warming — could create new business opportunities for ExxonMobil.

"One of the big deals that ExxonMobil has announced in the past year involves access to the Russian Arctic, where it is partnered with a Russian firm to access many billions of dollars worth of reserves involving big investments ExxonMobil would make north of the Arctic Circle," he says. "Why is that oil accessible? It's because sea ice is melting in the Arctic. Global warming may, in fact, unlock enormous opportunities for oil companies."
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Re: ExxonMobil:Private Empire

Postby CorruptUser » Thu May 03, 2012 7:01 am UTC

I'm not in favor of stabbing people in the kidneys, but I hold a huge supply of spare kidneys and my workers as a side effect of their work go on rampages stabbing people in the kidneys, so I think I will have some nice profit margins in the future that I earned fairly. I am a good person!

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Re: ExxonMobil:Private Empire

Postby kiklion » Thu May 03, 2012 11:56 am UTC

Jonesthe Spy wrote:“Presidents come and go; Exxon doesn’t come and go.” - Former ExxonMobil CEO Lee Raymond, capturing in a nutshell why we need to drastically reduce corporate power and influence.

On the heels of the big fat thread Ayn Rand thread inspired by strip 1049, here's a piece about one of the biggest, most powerful corporations in the world and how it behaves. Very scary in my humble opinion. Partnerships with Third World dictators, funding a propaganda war against the climate science that said we need to reduce the use of fossil fuels, ignoring SEC regulations, and completely protected from being held accountable by its vast wealth, annual revenues being larger than most nations.

http://www.npr.org/2012/05/02/151842205/exxonmobil-a-private-empire-on-the-world-stage

I highly recommend listening to the whole piece if you can, not just checking out the written synopsis.


It is nit-picking, but wealth doesn't protect you. Bribes and corruption protect you.

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Re: ExxonMobil:Private Empire

Postby Enokh » Thu May 03, 2012 2:24 pm UTC

The ability to hire teams of lawyers and lobbyists is something that protects you, even if none of those people are corrupt or using bribes (for example, the lobbyist could genuinely believe in his cause and be 100% honest in it's pursuit).

It might be true that at the level ExxonMobil is playing at, having more money than someone else on their level won't make enough of a different in an of itself, but the idea that having gobs of money doesn't protect you is completely false.

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Re: ExxonMobil:Private Empire

Postby CorruptUser » Thu May 03, 2012 4:17 pm UTC

Yeah but wealth isn't foolproof protection. You can't bribe every single news station simultaneously, at least not forever; you simply don't have enough money no matter how much you think you have, especially when one of those news companies is owned by your rivals (NBC/GE).

Plus, television and newspapers no longer dominate the news. Can't bribe the internet. At least until you could make it more or less impossible for opposing websites to reach their audiences...

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Re: ExxonMobil:Private Empire

Postby sardia » Thu May 03, 2012 4:29 pm UTC

CorruptUser wrote:Yeah but wealth isn't foolproof protection. You can't bribe every single news station simultaneously, at least not forever; you simply don't have enough money no matter how much you think you have, especially when one of those news companies is owned by your rivals (NBC/GE).

Plus, television and newspapers no longer dominate the news. Can't bribe the internet. At least until you could make it more or less impossible for opposing websites to reach their audiences...

You know what would be a great way to get that done? Throw superpac money at politicians until you can.

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Re: ExxonMobil:Private Empire

Postby nitePhyyre » Thu May 03, 2012 5:08 pm UTC

CorruptUser wrote:Yeah but wealth isn't foolproof protection. You can't bribe every single news station simultaneously, at least not forever; you simply don't have enough money no matter how much you think you have, especially when one of those news companies is owned by your rivals (NBC/GE).

Plus, television and newspapers no longer dominate the news. Can't bribe the internet. At least until you could make it more or less impossible for opposing websites to reach their audiences...
On the other hand...http://xkcd.com/1019/
sourmìlk wrote:Monopolies are not when a single company controls the market for a single product.

You don't become great by trying to be great. You become great by wanting to do something, and then doing it so hard you become great in the process.

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Re: ExxonMobil:Private Empire

Postby iamspen » Thu May 03, 2012 6:18 pm UTC

kiklion wrote:
Jonesthe Spy wrote:It is nit-picking, but wealth doesn't protect you. Bribes and corruption protect you.


Yes, it does. ExxonMobile can break whatever laws it wants, because the reality of the situation is, they have the capital to pay any fines that could ever be levied against them while still maintaining a healthy profit margin. Where's the risk if they, say, "forget" to properly inspect safety equipment? What consequences await if they, due to, "oops, oversight," don't treat their employees properly under the law?

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Re: ExxonMobil:Private Empire

Postby CorruptUser » Thu May 03, 2012 6:38 pm UTC

And if the fines are at least as much as the negative externalities and are used to compensate adequately for the damage, it's not a problem; it means that the benefit from violating a regulation is greater than all costs, rather than just the internal costs.

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Re: ExxonMobil:Private Empire

Postby sardia » Thu May 03, 2012 6:40 pm UTC

CorruptUser wrote:And if the fines are at least as much as the negative externalities and are used to compensate adequately for the damage, it's not a problem; it means that the benefit from violating a regulation is greater than all costs, rather than just the internal costs.

They're not. Even if they were, big companies routinely appeal the fines, and get them reduced down to a fraction of the original fine.

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Re: ExxonMobil:Private Empire

Postby iamspen » Thu May 03, 2012 6:54 pm UTC

sardia wrote:
CorruptUser wrote:They're not. Even if they were, big companies routinely appeal the fines, and get them reduced down to a fraction of the original fine.


And it's not like we're talking about a single violation here. Even if we assume every violation ExxonMobile commits is unintentional (which would be a foolish assumption), the money they save on every violation that isn't caught would be enough to cover even the most exorbidant fine on the one that is.

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Re: ExxonMobil:Private Empire

Postby CorruptUser » Fri May 04, 2012 4:37 am UTC

Intention is irrelevant. So long as the fines are greater than the damage done, it's not a problem. Which I guess we can agree isn't necessarily the case, and I think we could also agree that the fines aren't always used to actually undo the damage.

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Re: ExxonMobil:Private Empire

Postby Zamfir » Fri May 04, 2012 4:52 am UTC

and we don't know the magic number where money would compensate. a fine is not intended as a cost, to be optimized together with other costs. it's a punishment for something you were not allowed to do.

in general, regulators become very pissed of if they learn that fines are just accepted as the cost of business. that indicates that fines are too low, not that the activity is acceptable

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Re: ExxonMobil:Private Empire

Postby CorruptUser » Fri May 04, 2012 6:59 am UTC

...unless you include fines which exist as a different form of taxation, which is the case even in NYC. A few decades ago, NYC decided to impose a fine on trucks stopped in the road. But produce shops don't have parking to use to unload, so the choice for the people selling produce was to either close shop or just pay the extra fines and raise the price of produce to compensate.

And that is relatively tame example; just imagine parts of the world where half the laws only exist to make doing business illegal just to rack up extra taxes in fines and bribes and so forth. You simply can not do business in Russia or China without breaking a whole bunch of laws and/or bribing people.

Also, Steve Jobs used to park in handicap parking spots all the time, and just paid the fines. Kind of a dick move, but to him a few hundred dollars is worth less than the few extra moments to go to a different spot.

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Re: ExxonMobil:Private Empire

Postby Zamfir » Fri May 04, 2012 7:16 am UTC

If you want a company to treat a payment as a normal cost of doing business, they're permits, not fines. There can be muddy cases in between, but that doesn't make every fine a permit.

They're different instruments, with different purposes and different legitimations. They differ in the best way to administer them, or how to determine the proper size of the payment. It's rarely a good thing if such things get mixed up. Happens anyway, but that's life.

Corruption is yet another thing, and it's obviously a bad situation when fines and bribes are not easy to separate.

EDIT: added some extra text

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Re: ExxonMobil:Private Empire

Postby CorruptUser » Fri May 04, 2012 7:24 am UTC

...which is why you attach criminal charges to things that you really don't want to allow, or make the fine based on the person's income rather than a flat fee. For example, speeding tickets are initially a fine, as well as a delay that undoes the purpose of speeding in the first place. But speed too often, or too much, and you can have your license revoked. Drive without a license, and you can face jail time.

That isn't to say that there aren't places where speeding tickets are a form of taxation. Just that we really don't want people speeding because it puts everyone at risk. But for things that don't have criminal charges, the government is perfectly happy to keep giving you fines so long as you pay them.

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Re: ExxonMobil:Private Empire

Postby Zamfir » Fri May 04, 2012 7:40 am UTC

Yeah, a fine is levied for breaking a law. That's sometimes implicit, if a lower authority gets the authority to offer a fine instead of going to court, but the possibility of a court case is in the background.

EDIT: if with 'criminal charges' you mean 'charges that might put an individual in jail', then no.Sometimes the responsibility for an act lies clearly with an organization, while individual responsibility within that organization is harder to prove, or too diffused.

In such cases you still levy a (heavy) fine, but that doesn't necessarily make it less grave than a case with jail time involved. It's just that you can't put organizations in jail.

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Re: ExxonMobil:Private Empire

Postby CorruptUser » Fri May 04, 2012 7:58 am UTC

But you can revoke their corporate charter.

Also, SOX (Sarbanes-Oxley) requires the senior execs to sign off on their statements, to avoid the previous "oh gee I had no idea we were committing blatant fraud" arguments, so it's not impossible to hold upper level people responsible for the company's actions.

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Re: ExxonMobil:Private Empire

Postby Ghostbear » Fri May 04, 2012 8:03 am UTC

It's probably relevant to point out that, at least in the US, most situations of companies getting fined results in an agreement where the company pays some of the fine, but doesn't have to admit any wrongdoing. The big problems with fines in relation to companies like ExxonMobil is that the fines that will be collected are just too low to discourage the associated behavior, and that there's no political willpower to raise those values.

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Re: ExxonMobil:Private Empire

Postby Zamfir » Fri May 04, 2012 8:14 am UTC

Also, SOX (Sarbanes-Oxley) requires the senior execs to sign off on their statements, to avoid the previous "oh gee I had no idea we were committing blatant fraud" arguments, so it's not impossible to hold upper level people responsible for the company's actions.

Oh, sure. It just doesn't work in reverse. If the government presses charges against individuals, it's a sign that it takes the breach of the rules serious. But if it doesn't press charges against individuals, it might still takes it serious.

Your mention of fraud is important here. That requires proof of intentionality, or somethin along those lines. Once you can establish that for some individuals, it is sometimes possible to hold higher-ups also responsible, even if you cannot prove that they were aware of the act.

Often you cannot prove something like intentionality or even negligence, for anyone. But still want to punish the organization heavily for the result.

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Re: ExxonMobil:Private Empire

Postby iamspen » Fri May 04, 2012 11:52 am UTC

Ghostbear wrote:The big problems with fines in relation to companies like ExxonMobil is that the fines that will be collected are just too low to discourage the associated behavior, and that there's no political willpower to raise those values.


Except even if you fine ExxonMobile forty million if they ask an employee to skip lunch, they'll still laugh at that shit. There is literally no fine that is too big for these megacorporate entities to have to care about. When your gross revenues are forty billion per quarter, you really don't have to worry mcuh about the law because a.) the benefit of breaking a law and not getting caught outweighs the consequences if you do because there's not a risk involved, and b.) when you have as much money and political clout as ExxonMobile, the people who wrote the laws are on your payroll, anyway.

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Re: ExxonMobil:Private Empire

Postby Ghostbear » Fri May 04, 2012 12:01 pm UTC

iamspen wrote:[...]There is literally no fine that is too big for these megacorporate entities to have to care about. [...]

Nope. Sure, they make $40 billion in profit a year. If we want a fine to matter to a company like that, we can peg the fine to percent of revenue -- a fine of 0.01% of ExxonMobil's annual revenue would be $500 million -- they'd notice that. Or you can have fines that are constantly increasing with each infraction. So the first violation is a fine of $10 million, then it's a fine of $50 million, then it's a fine of $250 million, then $1 billion, and so on. Or as even another alternative, you just have really big ass fines for anything that affects such large industries, so you make the fine $500 million right off the bat. You could even use all of the above -- a two component fine: a large base fine ($100 million) that increases with each infraction, with an additional fine that is a percent of revenue.

We most certainly can fine fortune 50 companies enough that they really care about the fines. But, as I specifically noted, we don't have the political willpower to implement such a fining structure. If we could get past that hurdle, there's nothing specifically preventing us from using large enough numbers for them to care.

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Re: ExxonMobil:Private Empire

Postby iamspen » Fri May 04, 2012 1:03 pm UTC

That's an idea I could wholly stand behind. But again, when the people writing the laws are little more than arteries of the corporations affected, be they actual Congressmen or lobbyists, something like that is impossible. And even still, if ExxonMobile is committing a million infractions, and gets busted on one or two of them, the net gain is still likely greater than the loss they're taking on the fine, even in your (admittedly awesome) system of linking fines to profits. That's the way it is, because, like it or not, ethics don't matter to a well-oiled corporate machine. Fines aren't punishments to them, they're losses. And as long as the eggheads say the gains outweigh the losses, these megacorporations won't change their practices, even if it means getting hit with the occasional fine.

Note: I'm basing my argument on the assumption that ExxonMobile is committing a large number of violations, and that, even under your proposed system, the authorities would never have the resources to police such a large entity in a thorough manner. I should explicitly state that all I'm saying is, these large corporations could do the things I'm suggesting if they wanted to, and I'm not trying the suggest in any sort of factual way that they are.

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Re: ExxonMobil:Private Empire

Postby Zamfir » Fri May 04, 2012 1:09 pm UTC

iamspen wrote:Except even if you fine ExxonMobile forty million if they ask an employee to skip lunch, they'll still laugh at that shit

No one thinks "oh, we made 40 billion in profits last year, who cares about 40 million". It might be hard to believe, but oil companies are not particularly profitable if you take their size into account. In particular the amount of capital investment they represent.

Crudely speaking, Exxon owns an enormous amount of machinery (which requried a lot of money to buy), and employs a lot people to run those and to find out where they can best deploy new machinery. But if you look at a single one-million dollar machine owned by Exxon, that machine is not particularly more profitable than other one-million-dollar machines in the economy. Exxon just happens to be a lot of machines added together.

So every little department and every machine and every office within Exxon still feels a lot of pressure to run a profit. If you fine one such department 40 million, it hurts just as much as when you fine a small independent company 40 million. If the department loses that much money, the bosses are fired, the rest of the department gets restructured or abolished.

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Re: ExxonMobil:Private Empire

Postby iamspen » Fri May 04, 2012 1:15 pm UTC

Zamfir wrote:
iamspen wrote:Except even if you fine ExxonMobile forty million if they ask an employee to skip lunch, they'll still laugh at that shit

No one thinks "oh, we made 40 billion in profits last year, who cares about 40 million". It might be hard to believe, but oil companies are not particularly profitable if you take their size into account. In particular the amount of capital investment they represent.


Well, yes, but my point is, if you gain fifty million by asking a thousand employees to skip lunch, and you get fined forty million when one gets caught, you're still making a net profit of ten million. I'm not suggesting that they want to get caught, but I'm pointing out that, if they do get nailed for one infraction, there could conceivably be a hundred other infractions that save enough dough for them to cover their fines and still come out ahead. It's not that they don't want that forty million to still be in their coffers when the day is done, of course they do. The point is that, even if they get busted, under the current system, they still come out ahead.

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Re: ExxonMobil:Private Empire

Postby Zamfir » Fri May 04, 2012 1:27 pm UTC

Then again, you have a thousand chances to get caught.

From what I've heard, Exxon has indeed a reputation of skirting the law (though not really when it comes to lunch-skipping). But I am not convinced that has much to do with size or profits. You'll find enough money-losing tiny firms doing the same, many of them probably more than Exxon's top can dream of.

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Re: ExxonMobil:Private Empire

Postby PossibleSloth » Fri May 04, 2012 8:11 pm UTC

Zamfir wrote:Crudely speaking,

I really hope that was intentional :P

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Re: ExxonMobil:Private Empire

Postby jareds » Fri May 04, 2012 8:44 pm UTC

iamspen wrote:
Zamfir wrote:
iamspen wrote:Except even if you fine ExxonMobile forty million if they ask an employee to skip lunch, they'll still laugh at that shit

No one thinks "oh, we made 40 billion in profits last year, who cares about 40 million". It might be hard to believe, but oil companies are not particularly profitable if you take their size into account. In particular the amount of capital investment they represent.


Well, yes, but my point is, if you gain fifty million by asking a thousand employees to skip lunch, and you get fined forty million when one gets caught, you're still making a net profit of ten million. I'm not suggesting that they want to get caught, but I'm pointing out that, if they do get nailed for one infraction, there could conceivably be a hundred other infractions that save enough dough for them to cover their fines and still come out ahead. It's not that they don't want that forty million to still be in their coffers when the day is done, of course they do. The point is that, even if they get busted, under the current system, they still come out ahead.

And if, let's say, they are able to get the same increase in productivity by hiring an extra 200 employees at a cost of $150k each, making nobody skip lunch, then they're making a net profit of $20 million rather than $10 million, coming out even further ahead, even under the dubious assumption that they'd only get fined something like 0.001% of the time (I'm assuming they don't gain fifty million dollars by asking 1000 employees to skip lunch one time each).

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Re: ExxonMobil:Private Empire

Postby iamspen » Sat May 05, 2012 1:49 am UTC

jareds wrote:And if, let's say, they are able to get the same increase in productivity by hiring an extra 200 employees at a cost of $150k each, making nobody skip lunch, then they're making a net profit of $20 million rather than $10 million, coming out even further ahead, even under the dubious assumption that they'd only get fined something like 0.001% of the time (I'm assuming they don't gain fifty million dollars by asking 1000 employees to skip lunch one time each).


LOL, methinks we're reading too much into the example. It was, after all, intentionally ridiculous. Any notable infractions would likely mean a much higher profit or productivity margin than a grunt not taking his half-hour.

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Re: ExxonMobil:Private Empire

Postby Ghostbear » Sat May 05, 2012 2:09 am UTC

iamspen wrote:That's an idea I could wholly stand behind. But again, when the people writing the laws are little more than arteries of the corporations affected, be they actual Congressmen or lobbyists, something like that is impossible.

That's where the political willpower problem shows up. Essentially all of the issues being dealt with are solvable without extreme difficulty if we can get past the political hurdles. The problem is, we can't get past those political hurdles.

iamspen wrote:And even still, if ExxonMobile is committing a million infractions, and gets busted on one or two of them, the net gain is still likely greater than the loss they're taking on the fine, even in your (admittedly awesome) system of linking fines to profits. That's the way it is, because, like it or not, ethics don't matter to a well-oiled corporate machine. Fines aren't punishments to them, they're losses. And as long as the eggheads say the gains outweigh the losses, these megacorporations won't change their practices, even if it means getting hit with the occasional fine.

That just means the people determining the fine amounts would need to do some study in the probability of being caught. If a particular infraction has a 1% chance of being caught and successfully fined, then you just make the fine itself 100 times larger. If there's a lot of variance with the expected success rate, then you put some level of variance into the fine. If there's some other issue, then you can bake that into the fine too -- following the skipping lunch example, you'd make the fine have a built in assumption that n% of employees are forced to skip lunch, with a fine of $x million per employee forced to skip lunch. All of these problems are solvable, we just need to have regulators (and the politicians authorizing / overseeing them) with the power and willingness to solve those problems.

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Re: ExxonMobil:Private Empire

Postby jareds » Sat May 05, 2012 2:44 am UTC

iamspen wrote:LOL, methinks we're reading too much into the example. It was, after all, intentionally ridiculous. Any notable infractions would likely mean a much higher profit or productivity margin than a grunt not taking his half-hour.

But your extreme example is a counterexample to your main point!
iamspen wrote:There is literally no fine that is too big for these megacorporate entities to have to care about.

The fine doesn't have to be big relative to the revenue of the corporation, it has to be big relative to the profit gained by the violation. Your intentionally ridiculous example is simply an illustration of this. If the fine is a hundred thousand times the benefit, only a complete lunatic will commit the violation, whether it is making some work through lunch or omitting a safety measure, even if they can afford the fine in absolute terms.

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Re: ExxonMobil:Private Empire

Postby iamspen » Sat May 05, 2012 12:49 pm UTC

jareds wrote:But your extreme example is a counterexample to your main point!


Of course, we could always look at it as if it's an intentionally ridiculous hypothetical meant to be accessible to common people and not representative of actual financials, and that the numbers I made up were actually pulled from thin air and not taken off an actual balance sheet?

iamspen wrote:There is literally no fine that is too big for these megacorporate entities to have to care about.

The fine doesn't have to be big relative to the revenue of the corporation, it has to be big relative to the profit gained by the violation. Your intentionally ridiculous example is simply an illustration of this. If the fine is a hundred thousand times the benefit, only a complete lunatic will commit the violation, whether it is making some work through lunch or omitting a safety measure, even if they can afford the fine in absolute terms.[/quote]

Well, yeah. I've said it thrice, but I'll say it again. Under our current system, these companies face no risk whatsoever when they decide to act in ways that are illegal or unethical. I don't think we're disagreeing here, I think we're arguing minutia.

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Re: ExxonMobil:Private Empire

Postby Griffin » Sat May 05, 2012 3:48 pm UTC

The fine doesn't have to be big relative to the revenue of the corporation, it has to be big relative to the profit gained by the violation. Your intentionally ridiculous example is simply an illustration of this. If the fine is a hundred thousand times the benefit, only a complete lunatic will commit the violation, whether it is making some work through lunch or omitting a safety measure, even if they can afford the fine in absolute terms.


Unless they only get caught one out of every 200,000 times. Then of /course/ it's worth the violation.
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Re: ExxonMobil:Private Empire

Postby yoni45 » Sat May 05, 2012 4:00 pm UTC

Griffin wrote:Unless they only get caught one out of every 200,000 times. Then of /course/ it's worth the violation.


Well then all you need is an adjustment -- the fine just has to be big relative to the profit gained from the violation divided by the [perceived] probability of getting caught [i think i did the math right there?].
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Re: ExxonMobil:Private Empire

Postby Diadem » Sat May 05, 2012 4:09 pm UTC

Of course is the fine is bigger than the cost of bribing lobbying congress to have the legislation removed, than a company will do that instead of either playing by the rules or paying the fine.
It's one of those irregular verbs, isn't it? I have an independent mind, you are an eccentric, he is round the twist
- Bernard Woolley in Yes, Prime Minister

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CorruptUser
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Re: ExxonMobil:Private Empire

Postby CorruptUser » Sat May 05, 2012 4:26 pm UTC

Meh, I'd just think it'd be best to remove the right of all corporations, organizations, and unions to lobby, unless the organization is specifically set up to be political in nature such as a PAC. Also, corporations can't give to PACs.

jareds
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Re: ExxonMobil:Private Empire

Postby jareds » Sat May 05, 2012 4:58 pm UTC

iamspen wrote:Of course, we could always look at it as if it's an intentionally ridiculous hypothetical meant to be accessible to common people and not representative of actual financials, and that the numbers I made up were actually pulled from thin air and not taken off an actual balance sheet?

Yes, it's intentionally ridiculous, that's fine. But it's illustrating the opposite of your point. It's the sort of example someone would use to illustrate that no matter how large a company is, it will be dissuaded by fines that are large relative to the benefit of the violation.
iamspen wrote:Well, yeah. I've said it thrice, but I'll say it again. Under our current system, these companies face no risk whatsoever when they decide to act in ways that are illegal or unethical. I don't think we're disagreeing here, I think we're arguing minutia.

No, we're disagreeing. Under our current system, there are many, many things which megacorporations are successfully dissuaded from doing. If someone operates an oil refinery, and faces no risk whatsoever if they discharge all their waste directly into the Mississippi river, why isn't the river being polluted wily-nilly? It's because you're fundamentally wrong: megacorporations are dissuaded by fines in reality, including many, many fines that are currently in place. Even when not dissuaded, they face risks. Otherwise, what the hell happened to BP?
Are all fines correctly sized? No, of course not. But plenty are high enough, and large corporations are not magically unaffected by them.

Returning to the original point of this digression, it is indeed the case as kiklion said that ExxonMobil is above the law in many developing countries due to bribery and corruption, not because their wealth makes them ignore all fines. Otherwise, there would be no difference in behavior between operating in developed countries and operating in developing countries.
Griffin wrote:Unless they only get caught one out of every 200,000 times. Then of /course/ it's worth the violation.

Yes, yes. I took that order of magnitude from the numbers in the working-through-lunch example. However, I would think it's pretty much impossible to be caught that rarely at anything, due to employee turnover if nothing else.

Enokh
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Re: ExxonMobil:Private Empire

Postby Enokh » Mon May 07, 2012 12:57 am UTC

jareds wrote:No, we're disagreeing. Under our current system, there are many, many things which megacorporations are successfully dissuaded from doing. If someone operates an oil refinery, and faces no risk whatsoever if they discharge all their waste directly into the Mississippi river, why isn't the river being polluted wily-nilly? It's because you're fundamentally wrong: megacorporations are dissuaded by fines in reality, including many, many fines that are currently in place. Even when not dissuaded, they face risks. Otherwise, what the hell happened to BP?


You mean other than the mountains of bad press? Or how their stock value plummeted? Unless you've got something on how much BP has actually paid in fines/settlements -- and it's WAY bigger than I think it is -- I'm not inclined to believe that was BP's biggest punishment.

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Re: ExxonMobil:Private Empire

Postby Ghostbear » Mon May 07, 2012 1:13 am UTC

jareds wrote:Otherwise, what the hell happened to BP?

As far as I can gather, BP hasn't actually been fined anything yet. This article (from 2010) notes that the legal proceedings have begun, but that the case is likely to take several years to reach a conclusion -- it mentions the Exxon Valdez case took 21 years to do so. According to this they have made a deal as of this March on civil litigations that would cost them an estimated $7.8 billion, but none of that is based off of fines.


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