It seems strange that the falsehood about the gas tax wasn't corrected in the text but rather in an endnote.
The Case Against Delaware (2002)
11–20 of 45 posts
Re: The Case Against Delaware (2002)
#12> This is partly true, but it ignores the overriding factor: Incorporating in Delaware allows companies to operate under its laws and courts, which are the most pro-management in the nation. This is inaccurate. Being familiar with both, I wouldn’t say Delaware is more pro management than New York. Which makes me wonder what else in the article is outright fabrication. (The idea of “pro-management” corporate law is it…
>This is inaccurate How so? I'm curious, as I don't know much about corporate law.
https://news.ycombinator.com/item?id=12320377
An old thread, but the discussion covers a bit on how Delaware actually has extremely pro-shareholder laws relative to other states, including requiring disclosure of the cap table.
If we want to also talk about misleading, I think choosing a subset of the reasons that businesses choose to incorporate in Delaware and selling them as the sole or even primary reasons is pretty misleading. If you even do a short Google search on why companies incorporate in Delaware, you'll find that one of the top cited reasons boils down to predictability. Because Delaware has been the place companies incorporated for so long, it has a long and established set of case law and precedent, which brings of stability that states with fewer corporations will need to build over time. Add in feedback loop contributions, such as the amount of lawyers who have studied and are experienced in the state's corporate law, and the choice continues to make more sense even without the factors the author listed.
Re: The Case Against Delaware (2002)
#13> This is partly true, but it ignores the overriding factor: Incorporating in Delaware allows companies to operate under its laws and courts, which are the most pro-management in the nation. This is inaccurate. Being familiar with both, I wouldn’t say Delaware is more pro management than New York. Which makes me wonder what else in the article is outright fabrication. (The idea of “pro-management” corporate law is it…
In general, I think the article took a premise and cherry-picked examples to support its premise without bothering to consider the counterpoint. Let's take for instance the following passage:
> Of course plenty of states have some commercial cash cow to power their economies—Wall Street in New York or the entertainment industry in California. But those enterprises enrich their home states by creating products and services of value to consumers. Delaware, on the other hand, has come to its lucre at the direct expense of other states. It is simply a game of beggar-thy-neighbor.
A different angle on this could argue that Delaware saw the striking inefficiencies in having every state incorporate their companies separately, splitting case law, precedent, and laws on the books into fifty distinct and slightly different views on corporate law. They realized that if they could attract corporations to the state early, they could create a system by which they were the de-facto state for incorporation and thus for corporate law, creating long-term value for its constituents by bringing revenue and jobs to the state, all while bringing efficiency to the overall economy by defining the standards under which companies are run and lawsuits are settled. You might even call this not-unlike Wall Street as a centralization and standardization of how a certain type of business is constructed that brought value to the nation as a whole.
Re: The Case Against Delaware (2002)
#14Most of you focused on iteration and entrepreneurship should appreciate Delaware simply for its incorporation status alone. Why does everyone incorporate in Delaware do you ask? Is it some tax break or something purely financial, as most people guess? Nope. It's because Delaware put a stake in the ground a LONG time ago and said that they want to be the experts at dealing with business law. So much so that they have their own special court system brought over from England called the Court of Chancery, which iterates its laws at a much faster pace than typical government to keep up with the current business environment. This court system is comprised of Chancellors and Justices who are known to be the best in the world at business law. And when you take a close look at who elects the Court's officials, its strictly divided into half Republicans and half Democrats, with mixed representation from legal and non-legal backgrounds, same with politics. It's about as unbiased as one can get. and from an experience perspective, the Chancellors and Justices ONLY focus on business law cases. Would you want your business case to be dealt with by a judge who just had a divorce case before yours and a criminal case after yours?
I wouldnt either.
And from a development perspective, Delaware made their own Division of Corporations almost like a lean startup with the goal of making it the EASIEST and FASTEST way to incorporate your business, with their business hours being 24/7 with international support. You can literally incorporate your business in 15 minutes or less. Try doing that in your home state. Look into the history of the Division of Corporations and the Court of Chancery if you're interested, it's a fascinating story.
So at the end of the day, when you're incorporating a company and inspecting your fiduciary responsibilities to your future employees, shareholders, investors and customers... you want to make sure you incorporate wherever the Business laws are most up to date, with a fast process, a quick judicial system that plays the game by the books and will be swift and fair with a proven track record of extensive experience. Delaware has made itself the no-brainer solution to all of those problems.
And for that, we should thank them (regardless of how shitty their tolls are, ha).
Re: The Case Against Delaware (2002)
#15>making my way down I-95 in a rental truck...I screeched to a halt in front of what turned out to be a two-hour backup in Delaware. Never having driven down the East Coast, I at first assumed the traffic jam...But as my truck crept forward I saw it was no accident at all but a deliberate obstruction—specifically, a tollboth on the Delaware Turnpike.
Um...I-95 and the Delaware turnpike are not the same roadway. Somehow while applying the brakes on I-95 the driver and truck magically transported from I-95 to a 2hour traffic jam for a toll on the Turnpike?
Re: The Case Against Delaware (2002)
#16>making my way down I-95 in a rental truck...I screeched to a halt in front of what turned out to be a two-hour backup in Delaware. Never having driven down the East Coast, I at first assumed the traffic jam...But as my truck crept forward I saw it was no accident at all but a deliberate obstruction—specifically, a tollboth on the Delaware Turnpike. Um...I-95 and the Delaware turnpike are not the same roadway. Someho…
Also, when was this? I drove that stretch every other week when I lived in Wilmington, and never hit a jam. Was this pre-Speedpass?
Re: The Case Against Delaware (2002)
#17Most of you focused on iteration and entrepreneurship should appreciate Delaware simply for its incorporation status alone. Why does everyone incorporate in Delaware do you ask? Is it some tax break or something purely financial, as most people guess? Nope. It's because Delaware put a stake in the ground a LONG time ago and said that they want to be the experts at dealing with business law. So much so that they have…
Efficient business law and registration is very important. It's practically the secret ingredient of the "Anglosphere". Similarly the UK and Ireland have a big advantage in ease of company registration compared to the average EU country. Estonia have made a deliberate effort to copy this.
The book The Other Path has a fantastic account of how improving business law was a key ingredient in stabilising Peru and defeating Shining Path. (Should be taken with a grain of salt, but it's a fantastic idea)
Note that this does not require it to be made anti-employee or anti-consumer! It just has to be clear, simple, effectively and fairly enforced.
Re: The Case Against Delaware (2002)
#18>making my way down I-95 in a rental truck...I screeched to a halt in front of what turned out to be a two-hour backup in Delaware. Never having driven down the East Coast, I at first assumed the traffic jam...But as my truck crept forward I saw it was no accident at all but a deliberate obstruction—specifically, a tollboth on the Delaware Turnpike. Um...I-95 and the Delaware turnpike are not the same roadway. Someho…
[deleted]
Re: The Case Against Delaware (2002)
#19>making my way down I-95 in a rental truck...I screeched to a halt in front of what turned out to be a two-hour backup in Delaware. Never having driven down the East Coast, I at first assumed the traffic jam...But as my truck crept forward I saw it was no accident at all but a deliberate obstruction—specifically, a tollboth on the Delaware Turnpike. Um...I-95 and the Delaware turnpike are not the same roadway. Someho…
Also, when was this? I drove that stretch every other week when I lived in Wilmington, and never hit a jam. Was this pre-Speedpass?
The article is from 2002, I don't know about Delaware but at least around here that is right about when passes had maybe a lane or two at the toll system.
Re: The Case Against Delaware (2002)
#20The article makes a case against states competing with one another. I'd argue that competition is a very good thing in this case.
Yes. When governments compete, you win. When you're stuck with only one option, you're more likely to overpay.
Especially in a large popular state that is difficult to get away from in more ways than one.