I've been trying to figure out this part for quite a long time, and now I'm asking for your help in answering these questions of mine. I don't consider myself knowledgeable in the mechanics of the SR world, so I'm sure there's a reasonable explanation for this all.

it all starts with the extrateritoriality of the Megas. what does it really mean? so they have their own "government", right?

so the Megas have sovereign enclaves that hold a pretty large work-force as citizenry, and the richer part of the population too.

so there are fewer SIN holders out there, under political government. add to that the increasingly large number of SINless (=not the best tax payers), and you've got a municipal and national financial fiasco (I'm assuming that whoever lives in a corp enclave doesn't pay taxes).

am I right about this? if I am, then the only solution is for the corps to buy municipal services from outside and keep those political bodies afloat. if that is true, then why having enclaves in the first place? it's just an overpriced headache (assuming that the corps pay the bills for a much larger population. if not, then the government will go bankrupted fast, and collapse).

and here's the second catch: if this symbiosis between the Megas and the government is worthwhile for the corps, then the budget is too low (low tax revenues and lots of welfare, or damn high tax rates), and then who needs the government?
if it is worthwhile for the government, then it costs way too much for the corps, and then who needs extrateritoriality?

and third, if the corps control the government anyway, and they can profit from buying its services, then why not taking over it and becoming a bigger political entity (they are already political entities, aren't they?) and more profitable one? (services at operational costs).

if the Megas are political entities inside regional political entities, why having governments at all? or why corps should like becoming political entities in the first place?

Governments serve to prevent corp-wars, for one thing. Without neutral areas where the megas can sell their wares they would be reduce to economicly isolated socialist states. Eventually, their economies would collapse without the ability to expand and the only way to expand would be to conquer territory controled by rival megas.

The advantage of extrateritoriality is, as always, the ability to do whatever you want. Without extrateritoriality, corporations are subject to government regulations.

There is no single "good" answer to your many questions, but much of this is explained in "They've got the whole world in their hands" section of Corporate Download (realizing that it comes from the view point of an anti-corporate retro-anarchist). Key paragraph on p17:

so the Megas must be rather small compared to the vast population (with money), because any other way, they'd get too big, will have no clients, no income, and collapse. it says the opposite on "corporate download" (p.16)
so why taking care of housing, police, building, sewers, waste disposal, education, military protection and the rest of the governmental services for their "citizens"?

why not letting their workers live outside, where they will be taken care of by the proper authorities?
so they can "help" with part of it, like education, security and such, but the rest is costly and unnecessary. they can still have enormous power over the government by being such a huge tax income, just like some corporations are today. the law won't mess with them too much, unless they start killing people off and things like that. i also find it hard to understand a city so full of diplomatic license vehicles. having bad reputation doesn't hold. just look at the way diplomats behave on the roads.

corps becoming socialist states is exactly what's bugging me. they became states already, although they shouldn't have.

the "fist line of defense" argument sounds strange to me. in the enclave you get better conditions than outside. everybody knows the government is controlled by the corps. the SINless are poor, and so they're out of site for any practical purposes for the corps anyway. the corps can't focus on profit, because they have swarms of workers living inside their sovereign territory.

then we can talk about air space and the troubles it makes...

Extraterritorial megacorps only comprise 10 at the AAA tier, and perhaps 100 total at the AA tier. There are many more multinationals without extraterritoriality at the A tier, of course, and the vast majority of corporations exist at several more orders of magnitude greater numbers below that multinational A tier. The important thing to understand about megacorps is that they represent a disproportionate distribution of wealth, not population. The corps don't "own" everyone, and perhaps 1% of people live as part of a privileged existence within a megacorporate campus/state, with about 20% being affiliated with corporations (i.e. work for one, but still a "national" citizen), with a few regional exceptions (for example, technically, all SINned Pueblo residents are corporate affiliated, since you must own PCC stock to be a resident).

Also realize that the privileges granted to those who live all their lives within a corporation can just as easily be revoked when the "citizen" is perceived as a liability, even as much as simple "dead weight". "You're fired" is brought to a new level, here. As a corporate citizen, you are expendable, just another asset. While people who don't work for a corp envy the privileged existence and wealth of a corporate citizen, they certainly don't envy the dehumanizing effect it has when you are "just a number", and one that can be cut off at any time, either financially or fatally.

Note that while this scenario is plausible, it is not necessarily realistic. The reason it exists in Shadowrun is because Megacorporations (and the resulting plutocracy) are one of the staple and key elements of cyberpunk. Most of the main themes of cyberpunk echo the concerns of fiction during the Industrial Revolution, and are transplanted in a near-future setting: the dehumanizing effect of institutions upon humanity, man's inhumanity to man, the effect of industrialization on the Earth and Human Beings, class conflict between Haves and Have-nots, etc.

Governments perform all the services that a single corp won't find profitable but that the corporates, as a whole, need performed - such as infrastructure maintainance, law enforcement, military "defence" (or expansion), basic sanitation and minimal healthcare and education for the masses of low-ranked employees (read: blue-collar workers). Of course, 99% of these are now contracted out to various corporations, and the government becomes some kind of a "joint committee" of the corporate ruling elite which manages such projects. Thats why corporate tolerate a degree of taxes: they need roads, they need someone to hire the cops and pay the prison contractor, they need sewage and water and so on.

Also, keep in mind that in most cases, maintaining a large, strategic-level military force is unprofitable for most single corporations. Small corporate security and special-ops armies are profitable and tolerable, but maintaining a huge nuclear ICBM arsenal (as opposed to several tactical nukes), aircraft carriers, large battleships and large-scale military formations (such hundreds of infantry and armor divisions) are not. So they pay their taxes and together they fund their "military contractor" - the government.

And, of course, governments are a very comfortable shield to hide behind. Its far easier for the masses to accept a tyrannical government if it is "their" tyrannical government than if it is some company. And national sentiments are not dead yet, so the corps keep the "flags of convenience" and occasionally stir up international conflicts to divert the masses' attention from their crimes.

And last, remember that there are government (mostly military) power centers as well - not nearly as powerful as the corporation, but they still can cause some trouble unless satisfied by bribery and/or some minor concessions on the corporations' part.

The question wouldn't really shouldn't be "Why are there still national governments?" It's more accurately "Why would a corporation ever want to destroy them?"

National governments are there for, more or less, one purpose: to do the things the private sector can't or won't do. These are the sort of requirements for civilized life that cut into profits, and more often than not drive the governing body into perpetual debt.

Even with extraterritorality, most corporations wouldn't want to take on this burden. Why usurp the governments when they're perfectly willing to pay the garbagemen (which, coincidentally, you supply), maintain the infastructure (ditto), give your workers SocSec, and pay for their doctors?

For a reason to keep your workers housed read "The Grapes of Wrath" from John Steinbeck. Or come and visit the Ruhr Valley and the "Zechensiedlungen" (Mine villages). You don't have to be an exterritorial Mega to see the benefits of that.[1]

+ You can use "secure housing" as a means to lure in workers
- You can actually make them pay for it and get your salaries back
- You can actually secure your workforce
- By walling the area you can reduce contact to criminals / outsiders

+ You controll what establishments (shops, pubs etc) are in the region
- Only your products are sold, so even if you sell cheaper than "outside", you come out ahead
- The salaries flow back to you
- You can keep out or reduce certain influences

+ Communal services are most likely privated anyway, possibly by you
- Calculate the costs to "outsiders" high enough and they pay

+ Controll the schools
- Produce a workforce with useful skills, no Literature courses in company school
- Use schooling as a means to attrackt the parents
- Hook them young, make the corp the family

+ Your employees form a group
- Easy to introduce "moral consultants"
- Natural bonding and internal self control
- You can evict the families of dead / unproductiv employees


Birdy


[1] Actually Exterritoriality (A Shadowrun special) was the first thing I dropped as a Shadowrun GM. My Megas get their power the same way Volkswagen or HaliBurton do - They buy their politicians

Although they are on a slight tagent, you may find these threads of interest:

Extraterritoriality, How far does it go?

Corp. Citizenship., Is if for everyone?

I've been thinking about htis for a few days and looking at my notes and the truth is that most workers do not live on company sites. That was what made the arcologys so big. it was an experiment. Most extreterritoiality is limited to work spaces and labs and special concerns. think about it. if you are corp that has living quarters you have the additional cost of maintenance, waste removal etc. much better to let somone esle handle that because otherwise you increase your staff- the cleaners, plumbers, janitors all have to be housed too. and who is going to take the garbage away? If you're extraterritorial then the city won't come ofri t but you have to find a home.

That's fine when it's the shredded papers of your research team but who wants to have to find a final resting place for the soycaff grounds of your workforce?

If most employees live off site you can devote your resources to making money, not land fill.