UK Politics

Why? Are you not allowed to give gifts to your family until you pay off your mortgage? Paying dividends while using debt financing isn't inherently imprudent. I would have preferred vital services to remain in the control of the state and think the regulators have been laughably weak in allowing these companies to enfeeble themselves to the benefit of shareholders and ultimate cost to society, but demanding dividends not be paid until a company is debt free, in our current capitalist system (and any remotely similar system) is financially illiterate.

It's self serving and short termist in the worst way. We reap the consequences down the road but still bizarrely, and despite all evidence, the view that the private sector is somehow always better persists among some.

Because borrowing allows tax efficient financing of operations and business growth. Corporate debt by the way, also allows investors a lower risk way of participating in private enterprise.

"In a non-capitalist society." You mean one in which the joint stock company doesn't exist? Yeah if they didn't exist it would be pretty hard for them to either borrow or pay dividends.

Not trying to make a normative point, but society as it really exists (not some utopian counterfactual) and our legal system makes it very hard for them to do anything else. It would be weird and likely catastrophic if a corporation was like "we're going to deliberately screw over our share holders to pay back our bondholders even though it will probably result in poorer value service to customers because it would dramatically increase our cost of capital".