Opinion Should certain industries be banned from going public?

[Fedorgasm]

The system is set up so publicly traded companies MUST do everything they can to force growth. They actually get sued frequently for not earning enough profit for their investors.

This is one of the major causes of corporate greed.

So what if we simply banned companies in certain industries from going public? Like health care, for instance.

If all healthcare companies had to be privately owned, then it would give the owners the freedom to make the right decisions for everyone instead of the decisions that always result in max profit.

Of course some companies could still behave in a greedy manner, but they wouldn't be forced to.

 

[Sweater of AV]

That's a very slippery slope. There are benefits to going public and at the end of the day, companies are going to try to maximize profit no matter what.

 

[kflo]

The system is set up so publicly traded companies MUST do everything they can to force growth. They actually get sued frequently for not earning enough profit for their investors.

This is one of the major causes of corporate greed.

So what if we simply banned companies in certain industries from going public? Like health care, for instance.

If all healthcare companies had to be privately owned, then it would give the owners the freedom to make the right decisions for everyone instead of the decisions that always result in max profit.

Of course some companies could still behave in a greedy manner, but they wouldn't be forced to.

Privately owned companies are more opaque than public companies. Are you thinking about not for profit?

 

[KAZSoliloquy]

If all healthcare companies had to be privately owned, then it would give the owners the freedom to make the right decisions for everyone instead of the decisions that always result in max profit.

profit incentive is profit incentive. public services should not be incentivized to generate profits no matter who or what owns the capital.

 

[KBE6EKCTAH_CCP]

That's a very slippery slope. There are benefits to going public and at the end of the day, companies are going to try to maximize profit no matter what.

Not necessarily true

 

[Fedorgasm]

Privately owned companies are more opaque than public companies. Are you thinking about not for profit?

No, but I'm thinking about a company like In 'n Out. They are privately owned, so they can afford to make decisions that aren't necessarily great for short-term profits, but are better for long-term success.

For instance, most drive thru places are staffed by 5 employees. In 'n out staffs like 15. Sure, they could hit this quarter's targets by cutting the staff--but they don't. Because they believe by staffing enough employees to get you your food fast, and keep the restaurant clean, it will create more repeat customers which is better for long-term success.

Contrast that with a place like Taco Bell, which is owned by a publicly traded company, where they run the whole place with 3 very overworked employees. They cut the staff years ago to hit that quarter's targets, but then every subsequent quarter they lose customers because they're food sucks, and their place is dirty.

 

[Sweater of AV]

Not necessarily true

It''s pretty true outside of the obvious examples that are irrelevant here.

 

[Satsui Ryu]

Technically firms that perform auditing functions are not allowed to go public. But the OP basically is the argument for government to manage certain industries due to the profit motive corrupting the intended purpose of services that are absolutely needed by society. See private prisons and the question of ethics around those.

 

[nhbbear]

The system is set up so publicly traded companies MUST do everything they can to force growth. They actually get sued frequently for not earning enough profit for their investors.

This is one of the major causes of corporate greed.

So what if we simply banned companies in certain industries from going public? Like health care, for instance.

If all healthcare companies had to be privately owned, then it would give the owners the freedom to make the right decisions for everyone instead of the decisions that always result in max profit.

Of course some companies could still behave in a greedy manner, but they wouldn't be forced to.

Good point on healthcare. I just looked up ways to invest in health insurance companies and got a ton of hits. Here is from one article (that I can’t provide a link to because all my options disappeared for some reason and I can’t fix it). This is from yahoo financial website

“Amidst a backdrop of economic uncertainty worldwide, the healthcare industry has shown impressive resilience. Over time, the demand for healthcare goods and services has proven to be relatively stable. This resilience of the healthcare sector was particularly evident during the equity downturn of 2022, where, for example, the Health Care Select Sector SPDR Fund greatly outperformed the Nasdaq, S&P 500, and Dow Jones. BlackRock, Inc. (NYSE:BLK)'s data indicates that healthcare stocks exhibited 23% less volatility compared to the overall market in the past year. Additionally, throughout the last seven recessions, the healthcare sector consistently outperformed the broader market by an average margin of 10%. Moreover, during the past six recessions, the industry experienced an average earnings growth of 21%.”


“

 

[Hdfi]

Who cares? The Sun is going to turn into a red giant anyway. Let them increase their profits.

 

[KBE6EKCTAH_CCP]

It''s pretty true outside of the obvious examples that are irrelevant here.

But it really isn‘t. Privately held companies come in all shape and forms. Typically when they make enough money they don‘t follow profit maximising at all costs. They follow other objectives like continuity or stability in the region.

 

[Sweater of AV]

But it really isn‘t. Privately held companies come in all shape and forms. Typically when they make enough money they don‘t follow profit maximising at all costs. They follow other objectives like continuity or stability in the region.

Public companies don't solely focus on maximizing short term profits at all costs either. There's more pressure to hit targets but strategies also have to take into account long-term growth etc. Public or not though, companies generally have the same goals of profit and growth. The approaches may be different but the goals are the same.

Restricting health care to solely being privately owned will face the same issues with less transparency. It's not really a logical solution. What people likely want is some form of regulation without actually using that word.

Ultimately, companies can choose to stay private if they want. There's a reason they go public though. Industries aren't going to be very happy if you take that option away from them.

 

[Pittie Petey]

Arizona Ice Tea is still only 99 cents and Costco chickens are still just 5 bucks!

Those CEO's can stroll through the streets of NYC anytime they please

 

[ColemanwastheGOAT]

I don't know enough about this stuff, but my instinct is that companies 'going public' shouldn't be a thing, period.

It just creates pseudo-monopolies

I'm pretty much against corporatism in general.

 

[ssBaldy]

The system is set up so publicly traded companies MUST do everything they can to force growth. They actually get sued frequently for not earning enough profit for their investors.

This is one of the major causes of corporate greed.

So what if we simply banned companies in certain industries from going public? Like health care, for instance.

If all healthcare companies had to be privately owned, then it would give the owners the freedom to make the right decisions for everyone instead of the decisions that always result in max profit.

Of course some companies could still behave in a greedy manner, but they wouldn't be forced to.

That is one step from socialism, my friend. Also I do think it is the right way, I do not think strategically important companies should be public. Or private, for that matter. But the free market apologets will brand this idea heresy.

I personally think that not everything that is good for the market is good for the people and in certain areas, like healthcare you mentioned, or other services providing for basic needs, I value people more that free trade.

 

[ColemanwastheGOAT]

That is one step from socialism, my friend. Also I do think it is the right way, I do not think strategically important companies should be public. Or private, for that matter. But the free market apologets will brand this idea heresy.

I personally think that not everything that is good for the market is good for the people and in certain areas, like healthcare you mentioned, or other services providing for basic needs, I value people more that free trade.

I'm not an expert, but corporatism and the free market are pretty much opposites.

 

[Sweater of AV]

That is one step from socialism, my friend. Also I do think it is the right way, I do not think strategically important companies should be public. Or private, for that matter. But the free market apologets will brand this idea heresy.

I personally think that not everything that is good for the market is good for the people and in certain areas, like healthcare you mentioned, or other services providing for basic needs, I value people more that free trade.

His suggestion is that they should be private. The "right way" you're referencing is government regulation.

 

[ssBaldy]

His suggestion is that they should be private. The "right way" you're referencing is government regulation.

Forbidding them from going public is also a form of government regulation, though

 

[Sweater of AV]

Forbidding them from going public is also a form of government regulation, though

You said his way of going private was "the right way" and then said strategically important companies like healthcare shouldn't be private (or public).

Pick one or the other.

 

[Hellowhosthat]

I think in an ideal world the government would own a lot of essential utilities but there would be good checks and balances in place to ensure they do the best job possible of it.