We have a new employee-owned Redners warehouse grocery in our little town, and we also have happily employed neighbors, a happy tax collector, and happy shoppers. This is the way capitalism should work.
4
I am unfamiliar with two of the contributors to the op-ed but as an economist, I am familiar with Richard Freeman's work and have even had the chance to meet him once in person. Given what I know of him, it is not surprising that he (and his co-authors) have advocated for a greater sharing of profits with workers. Now something that is quite clear from the backgrounds of these authors is that all of them have spent their entire careers in academia and have not spent a day running or operating a business. Therefore, it is certainly worth asking how much they can possibly know about how a business SHOULD be run when none of them have ever done it themselves, and certainly not at the scale of the organizations that they are talking of. But it may be that these are extremely perceptive individuals and have something useful to say on the topic without having any direct experience in running businesses themselves. Here again though they fall short in their analysis when they fail to mention the possibility that businesses can make losses. Indeed, every proposal involving profit-sharing that I have heard would seem to suggest that businesses only make profits and never make losses. The reality is that businesses make losses too (exhibit 1 being the pre-2008 GM) and no one ever suggests that workers should have their salaries reduced when businesses make losses. In the absence of such an arrangement, a mandate on businesses to share profits with workers is one-sided and unworkable.
5
Profit-sharing makes common sense. It increases worker motivation and morale. It is an ethical approach to the division of profits earned by a collaborative effort (such as a corporation). Do politicians have the courage to pass laws that encourage profit-sharing? That's questionable, even though they, through our system of campaign financing, certainly are receiving a noticeable share of the profits. But then, they receive those monies to vote a certain way and protect certain interests. They do not receive the monies for acting courageously on behalf of working people.
1
Bravo ! and I would also plead for a $15/hr minimum wage.
3
The authors imagine a magical capitalism fashioned with their magical thinking where all companies gain in value and every investment has poistive and growing returns.
Except.... they don't - if you own part of a company - you own it when it goes up - you own it when it goes down.
You want a share ownership of my company - you will have to trade some of your wages - there is no free ride or corporate welfare - except maybe in the minds of over-paid academics.
You want to monkey with an already totally opaque corporate tax system - yeah - that is always a winner for small buss competitiveness.
You want inclusive capitalism for all - then the "all's" have to embrace it - why do you think you opted for tenure rather and an entrepreneurial venture?
Except.... they don't - if you own part of a company - you own it when it goes up - you own it when it goes down.
You want a share ownership of my company - you will have to trade some of your wages - there is no free ride or corporate welfare - except maybe in the minds of over-paid academics.
You want to monkey with an already totally opaque corporate tax system - yeah - that is always a winner for small buss competitiveness.
You want inclusive capitalism for all - then the "all's" have to embrace it - why do you think you opted for tenure rather and an entrepreneurial venture?
4
Well, if you can't "incentivise" a business to enact profit sharing why doesn't the Government just force them to do it? It would be easy. Just regulate private businesses so much that this "profit sharing" idea will be the only avenue to actually have a stake in their own business. Otherwise the Government will just take it away and give it to the employees.
Isn't this kind of progressiveness what this Government is all about?
Scary.
Isn't this kind of progressiveness what this Government is all about?
Scary.
1
The wealthy one percenters and corporations are the targets of the article and most of the comments by the readers. Of course, the only thing worse than that are the very same readers who feel they should somehow be entitled to that wealth. Greed works both ways.
1
>
Nothing will change until the GOP is dislodged from the House, full stop; which as far as I know, not even the most calloused, optimistic Democratic, in the know, is predicting that. The power resides in the House. If it wasn't for the GOP wanting to start wars every other month and the SCOTUS picks, I'd rather have the House than the WH.
Hillary will be pretty much powerless when it comes to new legislation. Your wish list is just that a wish list, where its final destination is the ether. Plus the GOP will be going nuts with her in the WH.
All that said, her or any Dem elected to the WH is of the greatest importance, and not for the reasons you delineated in your article.
The SCOTUS is older than dirt. These chairs need to be filled by a Dem POTUS. Should the GOP win the WH, not only will Ginsberg not make it, but the other three GOP dinosaurs would most likely be asked to step down so a GOP POTUS could fill the chairs with young rightwing ideologues. This will be a death blow to this country.
You think things are bad now ? Just imagine a GOP POTUS, House and 2018 GOP Senate.
Nothing will change until the GOP is dislodged from the House, full stop; which as far as I know, not even the most calloused, optimistic Democratic, in the know, is predicting that. The power resides in the House. If it wasn't for the GOP wanting to start wars every other month and the SCOTUS picks, I'd rather have the House than the WH.
Hillary will be pretty much powerless when it comes to new legislation. Your wish list is just that a wish list, where its final destination is the ether. Plus the GOP will be going nuts with her in the WH.
All that said, her or any Dem elected to the WH is of the greatest importance, and not for the reasons you delineated in your article.
The SCOTUS is older than dirt. These chairs need to be filled by a Dem POTUS. Should the GOP win the WH, not only will Ginsberg not make it, but the other three GOP dinosaurs would most likely be asked to step down so a GOP POTUS could fill the chairs with young rightwing ideologues. This will be a death blow to this country.
You think things are bad now ? Just imagine a GOP POTUS, House and 2018 GOP Senate.
18
Another reference to the "economic boom" following WWII? The good old days, back when the USA was the only industrialized country, whose production base hadn't been destroyed during the war. Back when we had virtually no competition in the world markets. Back when we could dictate wages, products and prices. Capitalism is the great equalizer, Americans just hate that our standard of living isn't higher than the rest of the world.
6
Honestly, there are many wonderful employees and they should be paid fairly, have access to sick and vacation time, a 401K as well as health care. These individuals make your business a success and should be rewarded. But ultimately, the business slump, compliance with regulations, or failure is totally a burden of the owner. The constant worry and endless hours, certainly not for everyone.
Maybe there is another side of the argument that wasn't considered...
Maybe there is another side of the argument that wasn't considered...
2
Old Joke:
"What is it you are praying for?" asked the rabbi's wife.
Rabbi: “I’m praying for rich people to give money to the poor."
His Wife: “Do you think G-d will answer your prayer?”
Rabbi: “He's already answered half of it. Starting today, poor people are going to be willing to accept money from the rich.”
"What is it you are praying for?" asked the rabbi's wife.
Rabbi: “I’m praying for rich people to give money to the poor."
His Wife: “Do you think G-d will answer your prayer?”
Rabbi: “He's already answered half of it. Starting today, poor people are going to be willing to accept money from the rich.”
3
Here in the 21st century's version of American capitalism it seems as though offering ANYTHING to workers aside from the typical minimum in compensation, is a certain step forward. It is also somewhat comforting to finally read and, in the case of Mrs. Clinton, hear some concrete steps towards these ends; excepting the usual debate about tax revenues and who pays what share. But it should also be noted that in the many cases of employee-employer disenfranchisement, where workers and the business owners have no direct relationship with one another, then a Union should be legally required as a representative of the worker's interests.
We're all now well aware of the dissolution of Union membership and what it's done to, what was, middle class America. Legal requirements, such as this article has amplified, should raise some eyebrows and start certain corporate leaders to take a more pragmatic approach to a future that's looking far less attractive, for everyone.
We're all now well aware of the dissolution of Union membership and what it's done to, what was, middle class America. Legal requirements, such as this article has amplified, should raise some eyebrows and start certain corporate leaders to take a more pragmatic approach to a future that's looking far less attractive, for everyone.
10
These are all excellent ideas for addressing the appalling inequality that blankets the nation, but there has never been a shortage of good ideas. The shortage has been in the area of integrity among our so-called political representatives, content as they are, to engage in the most anti-democratic and unpatriotic of behaviors on behalf of their corporate benefactors.
Hillary Clinton's record - her tenure on Walmart's board during that corporations most egregious union-busting, the close ties to Monsanto, the support for trade pacts from NAFTA to the TPP - makes her a poster child for this lack of integrity. The prospects of Clinton attempting to enact the proposals included in this article once elected are nil.
The only candidate who has a track record indicating the possibility that he sincerely wants to be a president for all Americans, not just the wealthy, is Sanders.
Hillary Clinton's record - her tenure on Walmart's board during that corporations most egregious union-busting, the close ties to Monsanto, the support for trade pacts from NAFTA to the TPP - makes her a poster child for this lack of integrity. The prospects of Clinton attempting to enact the proposals included in this article once elected are nil.
The only candidate who has a track record indicating the possibility that he sincerely wants to be a president for all Americans, not just the wealthy, is Sanders.
33
Progressivity must be restored to the tax code, so that lavish executive pay is no longer economic for corporations, as was the case for much of last century. Unions must be reempowered, probably by legislating universal card check.
Finally, free higher education must be made available to all.
Until these three necessary (but not sufficient) conditions are met, talk of reducing inequality is so much hot air.
Finally, free higher education must be made available to all.
Until these three necessary (but not sufficient) conditions are met, talk of reducing inequality is so much hot air.
24
It is understood that wealth disparity is the third great crisis in our nation's history. This is despite the design of the New Deal, now in its 9th working decade, to make capitalism more humane.
Through triumphs of social legislation like Social Security and recognizing a worker's right to unionize and bargain collectively, the constitutional dedication of federal power to the general welfare, or the social safety net as it is more commonly known, makes an admirable dent.
But the job is not finished. The “measure of progress,” President Obama has said, is “whether our economic system provides a fair shot for the many ... . To win that battle, to answer that call --- this remains our great unfinished business.”
Is there a practical solution to preserve the American Dream and restore meaningful equality of opportunity which empowers ordinary citizens to do it themselves? Now that would be something.
http://lifeamongtheordinary.blogspot.com/2014/07/life-among-ordinary-com...
Through triumphs of social legislation like Social Security and recognizing a worker's right to unionize and bargain collectively, the constitutional dedication of federal power to the general welfare, or the social safety net as it is more commonly known, makes an admirable dent.
But the job is not finished. The “measure of progress,” President Obama has said, is “whether our economic system provides a fair shot for the many ... . To win that battle, to answer that call --- this remains our great unfinished business.”
Is there a practical solution to preserve the American Dream and restore meaningful equality of opportunity which empowers ordinary citizens to do it themselves? Now that would be something.
http://lifeamongtheordinary.blogspot.com/2014/07/life-among-ordinary-com...
14
Marxism is never been implemented anywhere. Like most economic ideas, it is obfuscated in gobbledygook.
150 years ago Marx foresaw that ownership of automated means of production has to be distributed to sustain demand.
150 years ago Marx foresaw that ownership of automated means of production has to be distributed to sustain demand.
2
Holy Moley! I don't mean to be too rough on you, but your comment is gobbledygook. It's clear from it that you didn't read Marx's economic works including Capital's three volumes, the Grundrisse, the three books of Theories of Surplus Value and A Contribution to the Critique of Political Economy. They are a sober, hard-headed, penetrating scientific analysis of capitalism and his predecessors and contemporaries in the field of political economy.
I think you mean that communism hasn't been implemented anywhere. Marxism is an adherence to Marx's historical materialist methodology as a way to understand and explain the operation of different modes of production, especially capitalism.
I think you mean that communism hasn't been implemented anywhere. Marxism is an adherence to Marx's historical materialist methodology as a way to understand and explain the operation of different modes of production, especially capitalism.
5
Steve, say it ain't so. I have often read your comments and considered your viewpoint level headed, but this?
Marxism itself is gobbledygook. For Marx and more, his apologist Engels, were trying to prove a specious idea about how humanity works. In fact their arguments are so bad that they infected the thoughts of their enemies and turned Mises and his exposition of Human Action into a similar collection of gobbledygook.
No, Marx did not think that individual workers should be rewarded with a portion of the proceeds of the capital they produced. He thought the community of all potential workers should own all the capital in shares equivalent to their existential needs.
A ridiculous idea, doomed to fail for as long as we continue to use money to govern our economy.
The problem, of course, with the article writer's push for employee stock-ownership plans is nearly as overwhelming as the insanity of Marxism. Most of the workers mired in the lower middle class do not work for companies with significant capital assets, companies that will survive the next decade, companies that will employ them for a significant portion of their working lives.
If we really want to fix this then instead of reviving ESOPs we need to fix 401k's. Few outside management should hold a sizable portion of their net worth in the stock of the company they get their paycheck from. But everyone should own a piece of American capital and the potential for tomorrow.
Marxism itself is gobbledygook. For Marx and more, his apologist Engels, were trying to prove a specious idea about how humanity works. In fact their arguments are so bad that they infected the thoughts of their enemies and turned Mises and his exposition of Human Action into a similar collection of gobbledygook.
No, Marx did not think that individual workers should be rewarded with a portion of the proceeds of the capital they produced. He thought the community of all potential workers should own all the capital in shares equivalent to their existential needs.
A ridiculous idea, doomed to fail for as long as we continue to use money to govern our economy.
The problem, of course, with the article writer's push for employee stock-ownership plans is nearly as overwhelming as the insanity of Marxism. Most of the workers mired in the lower middle class do not work for companies with significant capital assets, companies that will survive the next decade, companies that will employ them for a significant portion of their working lives.
If we really want to fix this then instead of reviving ESOPs we need to fix 401k's. Few outside management should hold a sizable portion of their net worth in the stock of the company they get their paycheck from. But everyone should own a piece of American capital and the potential for tomorrow.
3
People have been arguing about how to distribute automated means of production ever since Marx.
1
Another author thinks capitalism is finished and a new world awaits. Reflect on the world your kids might inherit. http://www.theguardian.com/books/2015/jul/17/postcapitalism-end-of-capit...
1
Calling Bernie Sanders!
44
The “Sharing” concept is another way to divert attention away from the real problem – Corporate exploitation of not only workers, but also consumers. “Let’s not really reform American corporations, and instead, allow our workforce feel they have something at stake in our corporate success - not too much, but something.”
All the while Wall Street types drive short-term focus on next quarter's profits, and take billions in commission and fees in needless risky derivative investments, which if the actual aggregate negative event happens (think housing bust) they don’t have the financial resources to cover but have made billions for themselves until it does happen.
We need real fundamental corporate governance and regulatory changes not some “come join us in our rigged game of doing business.”
All the while Wall Street types drive short-term focus on next quarter's profits, and take billions in commission and fees in needless risky derivative investments, which if the actual aggregate negative event happens (think housing bust) they don’t have the financial resources to cover but have made billions for themselves until it does happen.
We need real fundamental corporate governance and regulatory changes not some “come join us in our rigged game of doing business.”
29
Do you think your employer is not paying you enough?
As this op-ed says there is an easy answer; just start your own business. And then, you can pay yourself what you think you are worth. Hey, a lot more than those evil corporations; taking YOUR productivity for themselves.
Really, it is that easy. Don't work for that evil corporation; create your own value. Create your own business!
These big corporations are horrible. You’re better off on your own. And with the ACA you will also have health care.
Go follow your dreams!
I’m serious, if everyone here created their own business and provided for themselves, the evil corporations would fold. They wouldn’t have any customers.
We should all do this; take back your productivity for yourself, by running your own company. And reap the rewards, instead of the evil 1%’s.
Who’s with me?
As this op-ed says there is an easy answer; just start your own business. And then, you can pay yourself what you think you are worth. Hey, a lot more than those evil corporations; taking YOUR productivity for themselves.
Really, it is that easy. Don't work for that evil corporation; create your own value. Create your own business!
These big corporations are horrible. You’re better off on your own. And with the ACA you will also have health care.
Go follow your dreams!
I’m serious, if everyone here created their own business and provided for themselves, the evil corporations would fold. They wouldn’t have any customers.
We should all do this; take back your productivity for yourself, by running your own company. And reap the rewards, instead of the evil 1%’s.
Who’s with me?
6
Not everyone is well fitted for this scenario. By your standards, every employee should become an employer. I just don't think that will work.
1
Me, for one. I've been banging on about that for awhile. It's not going to be a viable option for a lot of people, though, until government either helps - or gets out of the way, however you want to view that. There needs to be some tax reform in there, and possibly some incentives first. The internet needs to be sorted out - in terms of neutrality, privacy, security, etc. Copyright laws. Regulation. Single payer / public option would help a lot more than the ACA. And that's just from the federal government - never mind the state governments. Which can be downright unfriendly, depending on where you are.
Do we start our own bank? Our own electric company? Our own refrigerator manufacturer? The advice to start one's own business avoids dealing with the economic realities of our time. Most of us aren't and cannot be self employed. Too many of us are underpaid in relation to our productivity. Is it asking to much for hugely successful companies to share the bounty a bit more with the workers who make their wealth possible?
3
When all is said and done Trump does run but who has the better advantage? I'd say the shareholders who are the breadwinners in a corporate world. Who then will come out of top not Trump but the workers who fight for what is not given to them but what is earned.
Most employees need good wages every year, not a share of the profits that can be easily manipulated come next year.
3
This will never happen. No one wants it. No one believes it will help them. If the middle and working classes recover their political power, they will not push for this. They will want higher wages and higher taxes on the wealthy. I know that's not likely to happen soon either, but it's worth working for.
12
I guess Hillary Clinton has never heard of purchasing stock options through the company you work for. It's a practice that has gone on for decades. As in the case of my father in law he is given the option of purchasing a set amount of stock every 6 months. He is given a window to make his decision but must pay in cash. He's exercised it every 6 months for over 30 years and receives dividends when the company makes money. So Hillary's "plan" really amounts to nothing.
What she doesn't indicate are the parameters. How big a company? What is the minimum number of employees? Do they have to exceed a certain percentage profit for say the past 10 years?
To me all she is trying to do is bring back the power of the union. GM in their last contract gave the UAW a percentage of the company and seats on the board. Why? The employees get paid exceedingly well. They've invested zero capital and taken no risk but to placate the unions we'll give employees part ownership. When you purchase stock options you are buying into the company. That's a choice on the workers part. So we'll go beyond stock options? Does that mean employees will contribute to R & D? Hillary wants the employees to get everything but sacrifice nothing.
Hillary wants income inequality but if that's the case why are she and Bill working with an attorney to limit the damage of future estate taxes? Does she pay her fair share with each $200,000 speech? Please. She's got more shelters than all of us combined
What she doesn't indicate are the parameters. How big a company? What is the minimum number of employees? Do they have to exceed a certain percentage profit for say the past 10 years?
To me all she is trying to do is bring back the power of the union. GM in their last contract gave the UAW a percentage of the company and seats on the board. Why? The employees get paid exceedingly well. They've invested zero capital and taken no risk but to placate the unions we'll give employees part ownership. When you purchase stock options you are buying into the company. That's a choice on the workers part. So we'll go beyond stock options? Does that mean employees will contribute to R & D? Hillary wants the employees to get everything but sacrifice nothing.
Hillary wants income inequality but if that's the case why are she and Bill working with an attorney to limit the damage of future estate taxes? Does she pay her fair share with each $200,000 speech? Please. She's got more shelters than all of us combined
1
You probably don't know what stock options are. Your father in law simply has the option to buy stock he could otherwise buy through an internet brokerage firm. An option contemplates a future transaction date at the discretion of the option holder.
This actually sounds like a good idea, although I'm sure the same GOP phonies who think business leaders ( like Romney ) are qualified to be political leaders, will kick and scream when they are presented with a classical capitalist solution to a problem that they don't want fixed.
1
The need to keep capitalism enshrined as our ideological economic touchstone allows only for the type of half-solutions offered by Hillary (more specifically, her advisory team), and the author's of this piece.
Real change, however, and true democracy is more possible through policies advocated by economists like Richard Wolff, who is promoting Worker Self-Directed Enterprises (WSDE’s) to radically and sustainably turn the tide of economic justice. More is available at the website http://www.democracyatwork.info
Real change, however, and true democracy is more possible through policies advocated by economists like Richard Wolff, who is promoting Worker Self-Directed Enterprises (WSDE’s) to radically and sustainably turn the tide of economic justice. More is available at the website http://www.democracyatwork.info
1
The article notes that since the early 1970s there has been a change in thinking about corporate earnings… and that change is no accident. It is the result of propagandizing by the Business Roundtable that began around that time.
(see: http://www.nakedcapitalism.com/2012/04/ken-jacobson.html)
This propagandizing has led to the notion that corporations MUST maximize their profits… and as Jacobson notes in the 2012 essay cited above "...there is nothing in any U.S. statute, federal or state, that requires corporations to maximize their profits." It is the maximization-of-profits credo that leads to outsourcing of work to lower paid workers, to the offshoring of HQs, and the gaming of the tax system… and it is this credo that is limiting upward mobility in our country.
(see: http://www.nakedcapitalism.com/2012/04/ken-jacobson.html)
This propagandizing has led to the notion that corporations MUST maximize their profits… and as Jacobson notes in the 2012 essay cited above "...there is nothing in any U.S. statute, federal or state, that requires corporations to maximize their profits." It is the maximization-of-profits credo that leads to outsourcing of work to lower paid workers, to the offshoring of HQs, and the gaming of the tax system… and it is this credo that is limiting upward mobility in our country.
2
Is there no end to the creative ways economists and their political allies will come up with to funnel welfare to corporations? (And, is there no end to the creative ways the NYT will come up with to endorse Hillary Clinton?) Corporations should be allowed to continue to exploit this “[tax] loophole to offer lavish compensation packages to top executives,” you insist, as long as they now also offer a profit-sharing or share-ownership plan to all employees. And, if they deign to share profits with the workers who made them possible, “all levels of government” should further lavish these private corporations with public dollars in the form of “tax breaks, tax incentives and preference in the awarding of government contracts."
Capitalism is failing, you seem to say, but we can fix if by subsidizing private corporations with public tax dollars! Really? What’s to stop corporations from simply shifting a percentage of present employee compensation from salary to “profit sharing” to watch government pay them to pay their employees? State and local governments subsidized corporations to the tune of some $80 billion in 2012. The federal government chips in an additional $100 billion in subsidies, plus another $200 billion in tax breaks. The corporate welfare list goes on and on (see John Oliver's recent piece on publicly funded stadiums). This is Hillary’s plan to save the middle class? Like most Clinton programs, it looks like the real winners will be her corporate backers.
Capitalism is failing, you seem to say, but we can fix if by subsidizing private corporations with public tax dollars! Really? What’s to stop corporations from simply shifting a percentage of present employee compensation from salary to “profit sharing” to watch government pay them to pay their employees? State and local governments subsidized corporations to the tune of some $80 billion in 2012. The federal government chips in an additional $100 billion in subsidies, plus another $200 billion in tax breaks. The corporate welfare list goes on and on (see John Oliver's recent piece on publicly funded stadiums). This is Hillary’s plan to save the middle class? Like most Clinton programs, it looks like the real winners will be her corporate backers.
13
Of course, hand them a few crumbs from the table in lieu of decent wages and let them think they are the equals of the greedy moguls.
14
How is it "fairness" that if I spend my life getting an good education and then I spend 24 hours a day for years building my business then to have the government insists that I share my profits which the folks who went to parties, slept in, and watched TV?
1
profit sharing is called salary, or wages
owners share losses that is why they share profits
workers are not likely to sign on to share losses, wake me when they do- I will be dead for along time so I look forward to the technology to wake me
nothing stops workers from starting their own company, except that starting a company is a specific skill set, which is very rare and very valuable, which is why it is reimbursed so well
this article becomes a screed on management compensation, saying that the public, ie via the IRS that paragon of political neutrality (/sarc) , knows about what wages elicit performance and competence,
in 1962 I was a 17 yo delivery boy in a labor-inspired cooperative housing project in the Bronx, in one of our education sessions, I wrote that ownership of other businesses should likewise be cooperative
didn't get very far
who knew that G Washing-tom was a nascent shared ownership manager, I guess that did not apply to HIS biz, ' do as I say not as I do'
I guess Ms Clinton will add that to her 30 minutes $300k standard speeches, oh does SHE share profits in her own enterprise, sure
owners share losses that is why they share profits
workers are not likely to sign on to share losses, wake me when they do- I will be dead for along time so I look forward to the technology to wake me
nothing stops workers from starting their own company, except that starting a company is a specific skill set, which is very rare and very valuable, which is why it is reimbursed so well
this article becomes a screed on management compensation, saying that the public, ie via the IRS that paragon of political neutrality (/sarc) , knows about what wages elicit performance and competence,
in 1962 I was a 17 yo delivery boy in a labor-inspired cooperative housing project in the Bronx, in one of our education sessions, I wrote that ownership of other businesses should likewise be cooperative
didn't get very far
who knew that G Washing-tom was a nascent shared ownership manager, I guess that did not apply to HIS biz, ' do as I say not as I do'
I guess Ms Clinton will add that to her 30 minutes $300k standard speeches, oh does SHE share profits in her own enterprise, sure
1
Prof. Blasi is interviewed for the book 'God and Profits: How American Workers can Prosper' which lays out the argument that a more equal society can be brought about through Collaborative Capitalism and Employee Ownership. The book argues that the basis of such ideas is not only firmly rooted in our national history, as noted here, but in our religious culture. The religious core of this country (left and right) should back employee-ownership schemes not only because it's the right thing to do, but because it's better for us economically and as a society. In other words, it's the rational thing to do, as well. Tea Party politicos still occasionally make noise against 'crony' capitalism, but it'd be nice, if joining together, they actually latched onto something that was good for all of us. 'God and Profit' lays out how it could happen.
1
Capitalism works better where capital is used efficiently to produce goods and services and profits are shared with the stake holders including the workers. Many industry follows this rule - technology, energy, transportation, ..... but there are industry sectors that did not follow this like retail, hotel, restaurants,... The issue is how we can create laws that force all sectors to uniformly adopt the profit sharing policies. The issue is not raising minimum wages only - it has to include profit sharing scheme. Present profit sharing scheme is unduly biased towards the capital.
1
I believe the "main form of productive property" in America until the late nineteenth century was slaves, not farmland.
3
Great idea, never happen. At least not as long as we're depending on politicians like Clinton, who has been sold, then bought by the Wall Street titans. Remember them? Ship jobs over-seas? Enormous tax breaks? Advocating for illegal immigration, so wages can be kept at the abysmal rate they have been and continue to be decades later, advocating for more visas to take the jobs from tech workers? NAFTA? TPP? You're asking us to trust those that have helped create our slide down the highway to hell. I won't waste space on the Republicans. They've been more than honest in their belief that money rules America now, not the people. My trust in anything having to do with politics is nil. Your column is wonderful, but, forgive me if I sound rude, you're living in la-la land. We hear all kinds of great solutions. The problem? It's talk. We never see any kind of real, substantial action. And, as long as the United States continues to be owned by the rich and famous, it will continue to be talk. I'll be watching to see that there are major companies interested in this, but I'll believe it when I actually see it. I don't think that'll be anytime soon. Thanks for your effort though. I've always liked fairy tales.
3
Hillary is completely out of touch with large swaths of Americans who work for bare minimum wage levels, zero if any benefits from health care to retirement benefits. They do so by legal ways of marginalizing them; the use of subcontractors, and sub-sub-contractors in scores; part- time help. She makes to many six figure speeches while hanging out with the Wall Street crowd. Bernie has put his finger on something here.
19
We've had this idea for a long time. It's called Workers' Self-Management. Socialists have advocated for this for over a century. But I guess they have to use PC terms like "employee-share ownership" as to not offend the delicate sensibilities of their wealthy backers in the capitalist class.
https://libcom.org/library/workers-self-management-faq
https://libcom.org/library/workers-self-management-faq
11
This scam has been used for over fifty years an coincides perfectly with the rise of income inequality.
2
All true enough, except, sadly, it won't happen unless the government intervenes forcibly. That is unlikely where even a minority of the Trumpites (believers that wealth is a sign of God's favor) can block meaningful reform. It's going to come down to something like, "profit-sharing or the Lubianka, big boys, so take your pick".
1
Employee ownership can work, but it takes enlightened leadership to resist the siren call of a big cash out. See the history of SAIC (Science Applications International Corp), and what happened when the founder, Dr. Beyster, retired.
http://washingtontechnology.com/blogs/editors-notebook/2014/07/beyster-b... These ideas have a long history, I believe the famous French economist of two centuries ago, St. Simon, advocated the division of ownership between capital, managers, and labour.
http://washingtontechnology.com/blogs/editors-notebook/2014/07/beyster-b... These ideas have a long history, I believe the famous French economist of two centuries ago, St. Simon, advocated the division of ownership between capital, managers, and labour.
4
As a general matter, this is a great idea that everyone should support. It’s insufficient by itself, but combined with effective management of employees, a stake in the company’s success is a good means of improving retention, morale and the quality of work performed. UPS is one of our oldest and most successful examples of ESOPs that work like this; and we could try other models, as well – such as dedicating a percentage of equity in a company to profit-sharing, rather than out-and-out ownership of the equity by employees.
But it doesn’t really address the challenges Mrs. Clinton targets, does it?
The problem is that there currently are too few non-union jobs available at UPS that with tenure would allow entry into the ESOP. Do the authors suggest that employee ownership by burger-flippers or wait-staff at McDonald’s franchises or the local diner, or retail shops in the local strip-mall, would solve the problem when such businesses notoriously generate low profits, and where the risk is so high that they might be out of business in a couple of years?
Such focus on means of distributing wealth earned is fine, but produces its greatest value in a humming economy that grows compensations organically through intense competition for skills.
What are Mrs. Clinton’s ideas for jump-starting a high-growth economy, not just redistributing the earnings of one that isn’t growing fast enough to provide good jobs through organic demand for skills?
But it doesn’t really address the challenges Mrs. Clinton targets, does it?
The problem is that there currently are too few non-union jobs available at UPS that with tenure would allow entry into the ESOP. Do the authors suggest that employee ownership by burger-flippers or wait-staff at McDonald’s franchises or the local diner, or retail shops in the local strip-mall, would solve the problem when such businesses notoriously generate low profits, and where the risk is so high that they might be out of business in a couple of years?
Such focus on means of distributing wealth earned is fine, but produces its greatest value in a humming economy that grows compensations organically through intense competition for skills.
What are Mrs. Clinton’s ideas for jump-starting a high-growth economy, not just redistributing the earnings of one that isn’t growing fast enough to provide good jobs through organic demand for skills?
8
Hey, while you are at it what is Jeb's idea, or Cruz, or Santorum, or Carley, or Trump or ... well the whole lot of them.
Bernie Sanders actually has ideas. Check them out at: https://berniesanders.com/issues/
Bernie Sanders actually has ideas. Check them out at: https://berniesanders.com/issues/
1
Profit sharing is a start, but for real change, the authors should look into worker-owned cooperatives. Equal Exchange in MA, Namaste Solar in CO, the Evergreen Cooperative in OH.
26
I have no problem if the government wants to offer incentives to companies to reward their employees. But that is where their involvement should stop. It is then up to the individual company to structure their pay/bonuses/stock options as they see fit. If people don't like what the company has to offer then they are free to seek employment elsewhere. This notion that people expect their govt to get involved and dictate how businesses should pay their employees is both silly and scary.
3
Since you live in Florida and are a self-professed Music Guy, I am guessing you have not been in the job market lately. The idea that you can quit one job and go get another would be wonderful but for the fact that the "other job" doesn't exist. If it did, there would not be so many people who have given up looking for it.
2
"... they are free to seek employment elsewhere."
Not too original, and to those of us in the dwindling Labor field that is what's otherwise known as 'the right to starve.'
Not too original, and to those of us in the dwindling Labor field that is what's otherwise known as 'the right to starve.'
1
Nonsense. And more nonsense.
Executives who earn high salaries also pay high taxes. They disproportionately contribute to funding all sorts of things.
Forty five to fifty cents of a dollar paid to a six figure executive goes straight into the government's pocket. Spread that out over ten working class guys and the government take falls to a dime.
The real problem is the loss of high-paying, working class manufacturing jobs. In the 70s there were a ton of them - but in the 80s they started going south - from Union states to Arkansas, Nevada, South Carolina and Tennessee. Then, they went to China, Mexico, Viet Nam and beyond.
Who championed and signed the NAFTA bill that moved all kinds of manufacturing to Mexico? Why...that would be Bill Clinton.
Executives who earn high salaries also pay high taxes. They disproportionately contribute to funding all sorts of things.
Forty five to fifty cents of a dollar paid to a six figure executive goes straight into the government's pocket. Spread that out over ten working class guys and the government take falls to a dime.
The real problem is the loss of high-paying, working class manufacturing jobs. In the 70s there were a ton of them - but in the 80s they started going south - from Union states to Arkansas, Nevada, South Carolina and Tennessee. Then, they went to China, Mexico, Viet Nam and beyond.
Who championed and signed the NAFTA bill that moved all kinds of manufacturing to Mexico? Why...that would be Bill Clinton.
4
Hillary is once again trying this 'Government' giving stuff. What an oxymoron. The government has nothing to give that it does not first take from someone else. Capitalism is based on the productive use of capital and labor, its that simple. Companies do not need the 'government' telling them how and what is in their interest. 'Sharing the wealth' already happens, for that is what capitalism is really all about. The companies have for the last thirty years made the decision to increase their productivity, and profits, by making investments in technology and not labor, is what make the system 'free'. Finally, profits are in fact shared today in most companies via the pension investments like 401k's etc. Freedom works government does not.
1
Advocacy for business would do a world of good to the common man, if such advocacy precludes the sharing of profit with a larger group of employees than just a few; firing people to create shareholder value may not be the only advocacy for capital accumulation. Piketty, I am afraid missed this point, which Hillary is actually spot-on and the way to go should be to incentivize such actions.
The operative word is encourage. The alternative is to force big business to pay their federal and state income taxes by adopting meaningful tax laws that close the door on transfer pricing/profit shifting to tax haven subsidiaries. The tax rate is meaningless if the tax base/taxable profits are diminished by profit shifting. Profit-sharing? What about revenue-sharing from federal to state to local levels? Multinational corporations pay less and less to Uncle Sam so states and cities and towns get less and less.
I have not read your book gentlemen but have you looked at ways to make the corporate income tax more effective? Are you familiar with unitary worldwide combined reporting? Approved for use at the state level by the US Supreme Court...three times by increasing majorities!
I have not read your book gentlemen but have you looked at ways to make the corporate income tax more effective? Are you familiar with unitary worldwide combined reporting? Approved for use at the state level by the US Supreme Court...three times by increasing majorities!
Prying a portion of profits away from ownership to give to the workers is an interesting proposition, but pursuing legislation which actually accomplishes (and enforces) this will be another matter. There is no end to the detours that the GOP controlled Congress can place with respect to legislation that will surely get a thumbs down from their campaign donors. Some businesses are more geared towards this sort of thing than others. Product cost inflation will be one of the scare tactics used by the detractors.
The degree to which the Reagan doctrine "government is the problem" still appeals to the rugged individualism of those who take the risks and run companies is a formidable barrier, though there are companies that view their employees as a valued resource worthy of investment.
In my business (engineering), I have seen companies in the industry attempt to placate their employees with in-house run training programs and an overemphasis on their home grown safety programs. These efforts are low cost alternatives to provision of real professional development and sometimes the actual gear required to enter some sites safely. Further observations during my 35 year career have included witnessing of wage stealing on a grand scale, when the company was awash in profits.
Corporate intent is the key. Those who value their employees will go along; those who don't will find other ways to retrieve the profit that they believe belongs solely to them, even if a law is passed.
The degree to which the Reagan doctrine "government is the problem" still appeals to the rugged individualism of those who take the risks and run companies is a formidable barrier, though there are companies that view their employees as a valued resource worthy of investment.
In my business (engineering), I have seen companies in the industry attempt to placate their employees with in-house run training programs and an overemphasis on their home grown safety programs. These efforts are low cost alternatives to provision of real professional development and sometimes the actual gear required to enter some sites safely. Further observations during my 35 year career have included witnessing of wage stealing on a grand scale, when the company was awash in profits.
Corporate intent is the key. Those who value their employees will go along; those who don't will find other ways to retrieve the profit that they believe belongs solely to them, even if a law is passed.
4
The forms of capitalizing the workforce suggested here are a start, but as is clear from the stagnation of the middle class in America, having a share of capital is no protection from losing ground. There is capital and there is capital.
A senior citizen who invests well through a portfolio of stocks and bonds is a capital holder but they have no effective voice in how the operation of the entities in which they have holdings. For instance, they have no say over the C-level of that entity paying themselves in salaries hundreds of multiples of the workers they employ or whether those executives pay their labor living wages or even if they have employees converting them to independent contractors. They have no choice over money spent lobbying for political favor to reinforce their abilities to do any of these. They have no say over participation in ALEC's essentially ghostwriting what ends up as federal law on everything from regulation of medical devices to mention a current contraversy to farm subsidies and the burying of provisions for cutting SNAP in the passage of such laws.
The arrangement of employee stockholders as characterized here still hold employees by the shorthairs, poorly treated with no ability to leverage their capital holding position to create any change. In fact, it may actually encourage them to act against their own interests personally but also as stakeholders in the entities they hold capital.
A senior citizen who invests well through a portfolio of stocks and bonds is a capital holder but they have no effective voice in how the operation of the entities in which they have holdings. For instance, they have no say over the C-level of that entity paying themselves in salaries hundreds of multiples of the workers they employ or whether those executives pay their labor living wages or even if they have employees converting them to independent contractors. They have no choice over money spent lobbying for political favor to reinforce their abilities to do any of these. They have no say over participation in ALEC's essentially ghostwriting what ends up as federal law on everything from regulation of medical devices to mention a current contraversy to farm subsidies and the burying of provisions for cutting SNAP in the passage of such laws.
The arrangement of employee stockholders as characterized here still hold employees by the shorthairs, poorly treated with no ability to leverage their capital holding position to create any change. In fact, it may actually encourage them to act against their own interests personally but also as stakeholders in the entities they hold capital.
2
Without direct employee participation in profits and cash flows their enthusiastic support of business goals are managed through what amounts to a stick: "do [these things] or we'll fire you/hire someone else."
Better that there is a deeper connection and that requires something more than just the "stick." Here in the Boston area a fantastic recent story is that of Market Basket groceries. When the board and management tried to institute 21st Century capitalist strictures, partly by firing the CEO, employees, who are and were not unionized and KNEW he stood with them, risked their jobs and all they owned for his return. Arthur Demoulas was reinstated and Marketplace is thriving, even though it is fair, decent and supportive of workers and middle mgmt on a footing equal to capital.
ESOPs are a form I am more experienced with. My father worked at W.W. Norton, last I knew still an ESOP. Perhaps that's what drew him to work there. While stationed in Europe at the end of WWII my father wrote this: http://wp.me/pZshU-s, and however unusable in today's terms the ideas may be, treating all participants in a firm as partners to a goal vs most of them as means to an end, has its merits in business success and economic ethics.
Better that there is a deeper connection and that requires something more than just the "stick." Here in the Boston area a fantastic recent story is that of Market Basket groceries. When the board and management tried to institute 21st Century capitalist strictures, partly by firing the CEO, employees, who are and were not unionized and KNEW he stood with them, risked their jobs and all they owned for his return. Arthur Demoulas was reinstated and Marketplace is thriving, even though it is fair, decent and supportive of workers and middle mgmt on a footing equal to capital.
ESOPs are a form I am more experienced with. My father worked at W.W. Norton, last I knew still an ESOP. Perhaps that's what drew him to work there. While stationed in Europe at the end of WWII my father wrote this: http://wp.me/pZshU-s, and however unusable in today's terms the ideas may be, treating all participants in a firm as partners to a goal vs most of them as means to an end, has its merits in business success and economic ethics.
Will new employees find it more difficult to get a job in a place that appears to be a "closed shop"? Investment by employees is commitment to the investors, sure enough. Outsourcing doors would be substantially closed. Does that have an implact on trade deals? I would say, yes.
I like the initial proposal in principle, but the impact needs further consideration.
I like the initial proposal in principle, but the impact needs further consideration.
Current law already provides tax benefits for companies to put stock in tax-deferred accounts for employees (qualified stock bonus plans and ESOPs and stock purchase plans). These, however, are often abused by companies that overvalue their stock (or are used by inherently risky small enterprises) to increase their tax deductions while providing employees with an asset that is ultimately of little value. Any plan to expand the use of stock benefits for employees must be mindful of this history.
Yes, profit-sharing and employee stock grants are great for sharing the wealth and incentivizing employees. Also, as the authors point out, they are too risky as a substantial source of retirement income.
To achieve real change in addition to sharing--on an earned basis--the corporate wealth, corporations must be mandated to allocate meaningful ownership control via the respective Boards of Directors. Without true ownership participation employees can be gamed and substantive, fair benefits will not accrue to employees. There is more to work than a few bucks more in pay or stock holdings.
To achieve real change in addition to sharing--on an earned basis--the corporate wealth, corporations must be mandated to allocate meaningful ownership control via the respective Boards of Directors. Without true ownership participation employees can be gamed and substantive, fair benefits will not accrue to employees. There is more to work than a few bucks more in pay or stock holdings.
1
In the 1980s, I tried to convert our privately owned media consultancy company to an ESOP, following the Louis Kelso models. Resistance was high from our lawyers, our accountants and our bankers. Getting over these reflexive naysayers' objections was more than we could manage. We resorted to simple bonusing, but I'll always wonder what effect an ESOP would have had. Bernie Sanders is the most eloquent spokesman in the political mob for co-op ownership models, and he seems to be bringing Hillary along. Economist Richard D. Wolff advocates powerfully as well. Now Blasi and Kruse. Maybe there's hope!
I can see it now: profits are booming, equity skyrocketing, the name of the company is on everyone's lips, its product is taking over the globe--and a small coterie of managers and board members continues to vote themselves astonishing compensation, while relaying an infinitesimal percentage of growth back to the underlings and peons who make possible the entire enterprise.
The authors are right: profit sharing and stock options are a first step to reducing inequality. But the real step forward will be democratic ownership of the business itself, where everyone has a say in the operations--and compensation--of the workers therein. Whether or not this is called capitalism is only relevant for those dinosaurs and their bumbling, philistine market ideology.
The authors are right: profit sharing and stock options are a first step to reducing inequality. But the real step forward will be democratic ownership of the business itself, where everyone has a say in the operations--and compensation--of the workers therein. Whether or not this is called capitalism is only relevant for those dinosaurs and their bumbling, philistine market ideology.
1
This op-ed is missing the most important element of the equality for workers equation -- bargaining power. What employees had in the prosperous era and what they do not have in our new Gilded Age is bargaining power.
Profit-sharing and employee stock ownership? Fine, great. But couple it with union membership to ensure that those two benefits are subject to collective bargaining and are not able to be altered or eliminated at the employer's whim.
An entire op-ed that purports to give us the solutions to inequality without a mention of unions is lacking the most important piece of the puzzle.
Profit-sharing and employee stock ownership? Fine, great. But couple it with union membership to ensure that those two benefits are subject to collective bargaining and are not able to be altered or eliminated at the employer's whim.
An entire op-ed that purports to give us the solutions to inequality without a mention of unions is lacking the most important piece of the puzzle.
45
Limited employee representation on boards would really solve a lot of problems.
Now, I am not by any means suggesting that employees "run" the company because I am deeply doubtful that most people lacking c-suite or higher experience can really become fluent in the matters a board deals with, but some sort of board-level expert employee ombudsman who can act as a direct fiduciary to the employees sounds like a great idea.
Of course this article really jumps the rails for me in mentioning the idea that there need be some sort of ratio cap between (evil) CEO pay and (angelic) employee average pay--I flatly refuse to believe that it's sensible to pay people in a locked ratio versus as a result of their value to the company and the difficulty found in replacing them with someone of similar experience, education, etc.
Now, I am not by any means suggesting that employees "run" the company because I am deeply doubtful that most people lacking c-suite or higher experience can really become fluent in the matters a board deals with, but some sort of board-level expert employee ombudsman who can act as a direct fiduciary to the employees sounds like a great idea.
Of course this article really jumps the rails for me in mentioning the idea that there need be some sort of ratio cap between (evil) CEO pay and (angelic) employee average pay--I flatly refuse to believe that it's sensible to pay people in a locked ratio versus as a result of their value to the company and the difficulty found in replacing them with someone of similar experience, education, etc.
"The economic boom after World War II solidified the view that regular increases in fixed wages and benefits could carry the burden of “sharing the wealth.” Sadly, since the 1970s, wages have stagnated, and the idea of profit-sharing has been largely forgotten in public debates."
This was also a period where unions gained strength and had more influence how workers benefited from the companies success. Then we elected Saint Ronnie and he started dismantling the unions, starting with the air traffic controllers. That union busting effort and the "trickle down" economics have been the keys to our current condition of becoming a corporation controlled state. So to "correct" this evil done to the 99.9% we must, must, must elect more socially responsible people to our congress and importantly to the presidency. Only then will be get legislation and SCOTUS decisions that will help the 99.9%.
Vote for Bernie Sanders 2016
This was also a period where unions gained strength and had more influence how workers benefited from the companies success. Then we elected Saint Ronnie and he started dismantling the unions, starting with the air traffic controllers. That union busting effort and the "trickle down" economics have been the keys to our current condition of becoming a corporation controlled state. So to "correct" this evil done to the 99.9% we must, must, must elect more socially responsible people to our congress and importantly to the presidency. Only then will be get legislation and SCOTUS decisions that will help the 99.9%.
Vote for Bernie Sanders 2016
18
The authors maintain that growth through "profit-sharing and the ownership of capital" is not "some radical notion" in the United States, but is not a norm either. As land-based economy gradually transformed into industrial and post-industrial economy, the share of labor in the country's prosperity squeezed more and more. No advanced country in the world today has lower minimum wage than the United States. In all advanced countries, health care is universal and education is nearly universal, but that's not the case here. Extreme inequality in the country didn't grow overnight--it has its roots everywhere. Uprooting the roots of inequality will need more than profits-sharing with employees. If you lack healthcare and education, you may not even become an employee at all.
1
"Jefferson concluded the Louisiana Purchase in 1803 to help further the notion of “an empire of liberty” through broad land ownership. Lincoln’s landmark Homestead Act of 1862 gave federal land grants to settlers. (As a result of the Civil War, it was passed without representatives of the South, where land was concentrated in the hands of slaveholders.)"
Jefferson's Louisiana Purchase was done for another reason as well. The Souther Plantation class wanted more cheap land that they could then raise more crops using slavery. (Plus a place to move all those native americans that were on land that the Plantation class wanted). That takes a little of the shine off this endeavor. Texas rebelled from Mexico because Mexico made owning slaves illegal. Florida was added and the Seminole wars fought to capture run away slaves (and to expand slavery).
Lincolns Homestead Act of 1862 was indeed accomplished by not having the Plantation classes representatives in congress, as everything they did was to increase slavery where they could. Another endeavor Lincoln successfully got started was the continental railroad. The South wanted it to run through the south, mainly for the reason of (you can guess it) to expand slavery.
Jefferson's Louisiana Purchase was done for another reason as well. The Souther Plantation class wanted more cheap land that they could then raise more crops using slavery. (Plus a place to move all those native americans that were on land that the Plantation class wanted). That takes a little of the shine off this endeavor. Texas rebelled from Mexico because Mexico made owning slaves illegal. Florida was added and the Seminole wars fought to capture run away slaves (and to expand slavery).
Lincolns Homestead Act of 1862 was indeed accomplished by not having the Plantation classes representatives in congress, as everything they did was to increase slavery where they could. Another endeavor Lincoln successfully got started was the continental railroad. The South wanted it to run through the south, mainly for the reason of (you can guess it) to expand slavery.
1
I recall Nordstrom ran a profit-sharing program and many came away happy with their Christmas bonus. There are several assumptions for this plan to work. One of the assumption is that the person who works for the company absolutely love everything about the company and therefore, is willing to defer his or her pay to end of the year. The company runs a risk by letting it become employee owned business. There is no question some companies will thrive under this plan. For anybody to reach the status of wealthy, profit sharing where you are paid on your outcome is good exercise to get rich. This plan can work but details need to be examined. This can work in tech companies but not others. Its definitely something. I doubt HC will go through this.
Not a lawyer, but here's an idea. Employee ownership and management stakes are good starts, but labor is most often left with nothing in "restructurings" and strategic bankruptcies that strip pension funds and often (if not always) lower wages and benefits. Let's treat workers as creditors and place labor's claims, especially pension claims, ahead of ALL other creditors and investors. This is essentialy an expansion of the common law "Mechanic's Lien", and could be applied even under ESOPs by separating what is due by virtue of work and what is due by virtue of ownership. Would, no doubt, require development of new and equitable accounting principles; start by figuring out how to treat "labor" as an asset and not a liability. After all, every CEO asserts that "Our most important asset is our people."
1
Profit sharing is based on companies having profits. Health plan payments, raises ,401k matches, and other company benefits like stock options and restricted stock all are based on profitability. Excessive government regulation and compliance eats up significant funds, which if eliminated or reduced ,could add to corporate earnings and be available to be shared with employees. Government reform of regulation would be a positive step toward greater employee benefits. The ACA is the wildcard issue which employers fear.
And voodoo accounting can mask profits.
Greed and ego will impede any real change here. Corporate executives really believe that they are worth what they receive in compensation.
In essence, many of them are nothing more than meeting attendees.
In essence, many of them are nothing more than meeting attendees.
2
I am surprised that the authors did not make at least a passing reference to the decline of organized labor as a factor in the decline in the share of wealth - through improved benefits and increased wages - which has been denied to many workers. The effort to organize workers to improve their wages and benefits has been fought by corporations - in the courts, on the picket lines and in the workplace - with little opposition by most elected officials.
A reporter commented on PBS last night about Hillary Clinton taking contributions from Wall Street (like her husband and Obama did). Possibly her weak calls for improved support for unionization is the reason.
By the way, I voted for Clinton and Obama, feeling like many that they were the best choice but not my preferred one.
A reporter commented on PBS last night about Hillary Clinton taking contributions from Wall Street (like her husband and Obama did). Possibly her weak calls for improved support for unionization is the reason.
By the way, I voted for Clinton and Obama, feeling like many that they were the best choice but not my preferred one.
2
Inequality in the US is caused by education and consistency. Those who work hard to get an education and work consistently throughout their careers become wealthy along with the global high income strata. Those who forsake high school, even if they get a HS diploma, drift into low paying lives. But they are still in the top 1% globally. And that's why it happens. The poor in the US are rich by global standards. People in Africa live on $500/year. In the US, in-cash and in-kind, the poor get $30K/year [including their per capital share of government spending and its $75K].
But the point I'd make is anyone can be in a profit sharing plan - buy stocks with whatever it is you do earn. Do the poor do that? No. Do Democrats encourage it? No. Democrats want the poor dependent on them.
But the point I'd make is anyone can be in a profit sharing plan - buy stocks with whatever it is you do earn. Do the poor do that? No. Do Democrats encourage it? No. Democrats want the poor dependent on them.
Isn't the phrase "inclusive capitalism" an oxymoron. Also, federal, state and local governments may indeed help relieve some of the pressure on the middle class but only when both major political parties wish to help the middle class. The Republicans have done everything in their power to block all attempts to deal with income inequality. They have found it easier to deflect blame to the people with the least and (cynically) argue that the underclasses are responsible for wage stagnation. As long as they can fool some of the people all of the time, they benefit more from income inequality than solutions to income inequality. It breaks my heart to say it but Republicans don't have the best interests of the middle class American in their party platform. I'm a laborer. They don't even think my efforts at work warrant a raise to $10.10 an hour. The government can't do anything when half the government profits from this Dickensian worldview.
1
Capitalism has never been about "sharing the wealth." It is about people earning money, saving and investing for themselves as best they can over long periods of time. It offers no guarantees of success, no speedy results and does not promise to reduce or eliminate inequality. It is nothing more than an opportunity for individuals and families who wish to increase their wealth and income may choose of their own volition to avail themselves of. Persons desirous of reducing or eliminating inequality should align themselves with socialism, which has produced dubious results so far, but is at least philosophically in harmony with these goals.
1
Finally, someone who has an actual plan that could potentially improve the economy for more than just the people who are already rich. People are incentive driven. I have friends who.work in sales and the ones with progressive commission and bonuses work harder and make more money for their employers and themselves. When people don't see a return on their hard work they instinctively lower their effort and become less productive. The problem is getting the execs who are hoarding all the profits to agree to "sharing." The depression and stagnation of wages over the last few decades is a direct result of calculated efforts by big business to amass exorbitant profits with minimal overhead. If Hillary Clinton can really pull this off she's got my vote‼
10
As long as incentives for profit sharing were done in a way which truly benefited both employees and the nation as a whole, I'd be for it. I'm just very leery that any such laws passed by congress would be twisted by lobbyists in such a way as to grant more tax loopholes. For example, allowing Wall Street companies to claim bonuses given to employees are really profit sharing, and allowing them to give larger bonuses while claiming tax credits and thereby paying lower taxes than they do now.
Ultimately I think as long as we have a government where unlimited amounts of cash can be used to support candidates, and lobbyists have free reign to write legislation, the people in the US will wind up on the losing end of most legislation that gets passed by government. Until we overturn Citizens United, and pass meaningful campaign financing laws to get the corrupting influence of big money out of politics, Warren Buffet's class will continue to win their campaign of class warfare against the regular working people of the United States (as Mr Buffet put it, to paraphrase).
Ultimately I think as long as we have a government where unlimited amounts of cash can be used to support candidates, and lobbyists have free reign to write legislation, the people in the US will wind up on the losing end of most legislation that gets passed by government. Until we overturn Citizens United, and pass meaningful campaign financing laws to get the corrupting influence of big money out of politics, Warren Buffet's class will continue to win their campaign of class warfare against the regular working people of the United States (as Mr Buffet put it, to paraphrase).
37
I have been in the midst of conversations with the numerous people who pass by my home in a share-economy business, home stays. What is becoming increasingly evident as companies begin to utilize 'empathy' marketing in their business models, reduction of 'customer' satisfaction and ratings of their own performance with an irrelevant question, 'how likely would you be to recommend (company)?' the idea of being a share-holder, for those working to drive the profit-making for the owners and investors is not only appealing but necessary for building trust and confidence between the business world and the people who must rely upon it.
The Sharing Economy expects ever higher-performance from its participants while often holding out meaningless or elementary school style incentives-- an emblem, e.g., on one's home listing signifying 'super host' plus a $100 travel voucher while at the same time pushing 'improvement' without actually understanding or observing the work of the individuals providing the services for them. The companies who are profit-sharing understand the subjective experience of their employees or participants and value them for their effort first and then as a result, for the positive impact it has upon the company's profits, thus allowing all to profit through a mutual collaboration. With the rise of internet-based companies that are hauling in billions in 'value' and profit, there should be an insistence on a profit-sharing model for such industries.
The Sharing Economy expects ever higher-performance from its participants while often holding out meaningless or elementary school style incentives-- an emblem, e.g., on one's home listing signifying 'super host' plus a $100 travel voucher while at the same time pushing 'improvement' without actually understanding or observing the work of the individuals providing the services for them. The companies who are profit-sharing understand the subjective experience of their employees or participants and value them for their effort first and then as a result, for the positive impact it has upon the company's profits, thus allowing all to profit through a mutual collaboration. With the rise of internet-based companies that are hauling in billions in 'value' and profit, there should be an insistence on a profit-sharing model for such industries.
15
In the bad old days (not the bad modern days) labor and capital competed. Much of industry was labor intensive, and labor unions achieved some redress for poor workers. Now, automation is a factor often overlooked in the inequality equation. Labor is not scarce. Unions have lost influence partly because of that, partly because of policies like those of Reagan, and partly because it isn't cool to be a union member when one is not "a horny-handed son of toil."
The problem, at heart, is how American wealthy continue to view their disposable work-force. (Elsewhere, I saw coal-mining communities up close. I saw the effects of pneumoconiosis in the gasping, shuffling men, old before their time. I saw black, gritty lungs in the lab.) For all our advances (whatever they may be) workers continue to be disposable widgets.
Mine-owners brought out their best clothes and manners on Sunday and sang about "all things bright and beautiful" for an hour. Nowadays, workers don't get even that scant nod of recognition.
Profit-sharing, stock-options etc. are good ideas, but must be preceded by a recognition that workers are people on whom our society and communities are built. Swedish capitalists learned that lesson a century or more ago. American capitalists have not yet begun to learn.
The problem, at heart, is how American wealthy continue to view their disposable work-force. (Elsewhere, I saw coal-mining communities up close. I saw the effects of pneumoconiosis in the gasping, shuffling men, old before their time. I saw black, gritty lungs in the lab.) For all our advances (whatever they may be) workers continue to be disposable widgets.
Mine-owners brought out their best clothes and manners on Sunday and sang about "all things bright and beautiful" for an hour. Nowadays, workers don't get even that scant nod of recognition.
Profit-sharing, stock-options etc. are good ideas, but must be preceded by a recognition that workers are people on whom our society and communities are built. Swedish capitalists learned that lesson a century or more ago. American capitalists have not yet begun to learn.
57
And how, exactly how do you propose that capitalists recognize workers as people when their profit imperative dictates they do exactly the opposite? US workers are in the belly of the beast. Nothing less than fundamental change is going to benefit them in a substantive way.
Yours is the kind of "let's close our eyes and hope capitalists do the right thing without being forced to" pie in the sky optimism that leads to the same old, same old.
No wonder the NYTimes favored your comment.
Go, Bernie! Go!
Yours is the kind of "let's close our eyes and hope capitalists do the right thing without being forced to" pie in the sky optimism that leads to the same old, same old.
No wonder the NYTimes favored your comment.
Go, Bernie! Go!
American companies are so shielded by both myth maintained by the media (CEOs work harder and are smarter. Really? Than whom? The people who built and manage the New Horizons spacecraft? Bet there is not a billionaire in the bunch.) and by Congress that they have no incentive to learn the Swedish lesson. In America, but not Sweden, "greed is good." No, let me correct that: Greed is God.
1
Let the peasants eat cake and let the workers become capitalists. But at some point the peasants have to seize the cake and workers will have to seize the capital. The possessors of these things do not give them up willingly.
1
We tried profit sharing..it was called the 401K. As a result, of that scam workers lost defined benefit pension plans and a whole lot of money when the market crashed and when companies decided to trade away workers stability for some in house profits.
Worker should share in profits by being paid well and getting defined benefit pension plans. CEOs should not make 400x what the average worker earns and everyone including fund managers and corporations should have to pay their fair share of taxes. That sharing the wealth!
Worker should share in profits by being paid well and getting defined benefit pension plans. CEOs should not make 400x what the average worker earns and everyone including fund managers and corporations should have to pay their fair share of taxes. That sharing the wealth!
47
It must be back to the future: Small is Beautiful.
You better have a union to negotiate the terms of that profit-sharing, and you better make sure that profit-sharing supplements wages with a COLA or some other form of designated wage raises.
18
Kudos to Secretary Clinton for advancing this narrative.
It's well past time.
It's well past time.
3
Employee stock ownership seems like a band-aid for a brain tumor. It's precisely the type of incremental, half baked, tentative, cautious, leave things essentially the way they are policy I expect from Mrs. Clinton. Where's the evidence it would have any significant impact on inequality?
21
These are excellent ideas but this is where they fall short, "Southwest Airlines, which paid $355 million of its more than $1 billion in corporate profits last year to union and nonunion workers and managers, on top of salaries." A pittance and SW Airlines is the best? Employees should get the same payoff as "investors" who do nothing but siphon off the rewards of others' hard work. Better yet it is time for TRUE Employee-owned companies in America where ALL employees share equally in responsibility and profit with a limit on the difference between the highest and lowest paid employees and equal distribution of profits. No outside investors allowed. This is how average Americans will rebuild a prosperous, sustainable future.
44
Read about "Mondragon" in Spain. This is where we need to be heading.
A pittance? One third is not a pittance. If the numbers are accurate, then SW Airlines paid out more than a third of its earnings to union and non-union workers and managers, on top of their salaries. If they paid another third to investors, and kept one third as retained earnings for re-investment in the business, then I would say that SW Airlines has a very good business model. If "no outside investors" are allowed, then where would start-up money come from? Many employees do not want to be owners, and do not want the risk or responsibility. On the other hand, many business owners and investors treat workers badly. A more nuanced view is required.
2
Your answer shows how little understanding you have of how businesses operate and run. Presumably the reason you have put the word investors in quotes, is because you seem to be skeptical of what they contribute to a business. Well, for starters, they invest all of the capital that is required for the business to operate and second, they also bear the risk that they do not recoup their capital and actually lose money. Workers, as long as they have a job, are guaranteed a wage whereas investors (or "investors" if you prefer) are not guaranteed anything. They could make profits (as many do) but they could just as easily make losses and lose the capital they invested. Does that idea even occur to you or are you too far removed from the real world to understand these matters?
3
The referenced Enron example as being cautionary regarding ESOP's is a little too glib; the devil is in the details:
http://www.wsj.com/articles/SB1008712386485424000
Pure ESOP's are a great way for employees to directly participate in what they daily help create:
http://money.cnn.com/2010/06/03/smallbusiness/esop_plans/
http://www.wsj.com/articles/SB1008712386485424000
Pure ESOP's are a great way for employees to directly participate in what they daily help create:
http://money.cnn.com/2010/06/03/smallbusiness/esop_plans/
8
As capitalism implodes under the weight of its own success, the sharing economy is blossoming. Where will this lead us? It's brand new territory. Workers sharing in governance is a great idea, but corporations and their handlers will not go along with this willingly. They like their giant salaries and death grip on control. The sharing economy has risen up, because of the squelching of the ability for ordinary people to participate in the old corporate economy based on money. Money is becoming not as relevant, as goods and services are becoming shared more and more FOR FREE or in exchange. There will be a few very bumpy spots in the transition. But it is clear that capitalism will ultimately not be able to keep making the profit it does now, as the cost approaches zero marginal. Money is just a concept. If it is not needed or agreed upon, it is worthless. And now there is so much profit, that it is like old Spain who owned so much gold, the value of it plummeted. The corporations do not make their money on goods and services any more, but on the manipulation of their finances…in other words, they make money on their money. This virtual game is a house of cards.
57
An ownership interest for employees is a good idea.
A management interest for employees is an even better idea.
Employee representative are required to be on the Board of Directors in Germany. So are any major lenders. The Board must inform them as interested parties, and listen to them. They protect and influence.
Germany is doing rather well, as capitalists, "despite" protecting workers this way. They think they do even better because of it.
We should do the same.
A management interest for employees is an even better idea.
Employee representative are required to be on the Board of Directors in Germany. So are any major lenders. The Board must inform them as interested parties, and listen to them. They protect and influence.
Germany is doing rather well, as capitalists, "despite" protecting workers this way. They think they do even better because of it.
We should do the same.
112
List the last five start up businesses in Germany that have reached $10 billion in market cap, and the year they started. Hmmmm.
3
There should be some equity between top executive performance based income and the income of the rest of the organization, especially from a tax policy perspective.
It's a sad state of affairs that many corporations today can't figure out the benefits of shared performance on their own. Hopefully, the cost-down culture will slowly be replaced by the performance-up model.
It's a sad state of affairs that many corporations today can't figure out the benefits of shared performance on their own. Hopefully, the cost-down culture will slowly be replaced by the performance-up model.
34
The performance up model. Fine, what financial risks do the performance up people make? Do they invest their own capital? Do they take out loans to finance expansion, increase production, hire new people? So what exactly should they get? Are they being forced to work there? Couldn't they find a job where the pay and potential for increased earning potential is greater?
Let me give you a real story. My father in law worked for a very large company with 3 divisions. He started out at the very bottom, in the mail room. He laid tile and did income taxes to pay the bills. He worked any job and at one point he was a trouble shooter. He would be gone for 2 weeks at a time, come home for 2 days and repeat the cycle. He did this for 4 years. He became a general manager and ultimately they offered him the #4 position in the entire corporation. He busted his butt and made tremendous personal sacrifices to achieve the success he had. Ultimately he was given the #4 position in the entire corporation. He made it. He went through hell. He got a fantastic salary and stock options that he EARNED. You would look at him as a prima donna, fat cat, et. But he paid his dues but you wouldn't know that because of his office. He told me he would retire when he was worth $ million. He went from a guy working in the mailroom, laying tile and doing taxes and you want to penalize that. That's pathetic. Not everyone is what you think and maybe before you jump to conclusions you will think twice
Let me give you a real story. My father in law worked for a very large company with 3 divisions. He started out at the very bottom, in the mail room. He laid tile and did income taxes to pay the bills. He worked any job and at one point he was a trouble shooter. He would be gone for 2 weeks at a time, come home for 2 days and repeat the cycle. He did this for 4 years. He became a general manager and ultimately they offered him the #4 position in the entire corporation. He busted his butt and made tremendous personal sacrifices to achieve the success he had. Ultimately he was given the #4 position in the entire corporation. He made it. He went through hell. He got a fantastic salary and stock options that he EARNED. You would look at him as a prima donna, fat cat, et. But he paid his dues but you wouldn't know that because of his office. He told me he would retire when he was worth $ million. He went from a guy working in the mailroom, laying tile and doing taxes and you want to penalize that. That's pathetic. Not everyone is what you think and maybe before you jump to conclusions you will think twice
2
Profit sharing? Want to bet?
Hot air is all that we'll get.
Openly, not by stealth,
Raise the tax rate on wealth,
Start inequality's, sunset!
Hot air is all that we'll get.
Openly, not by stealth,
Raise the tax rate on wealth,
Start inequality's, sunset!
84
Really Larry? Ever hear of stock options? Isn't it profit sharing when you announce how much per share profit they made? You be sarcastic as usual but clearly you don't know what you are talking about.
2