I really appreciated Rachel Cohen’s discussion of what an employee stock ownership plan is and why there’s enthusiasm for them:
Unlike conservatives, who have defended employee ownership on the grounds that it’s most certainly not socialism — indeed, it turns laborers into capitalists — liberals have taken to ESOPs because they strengthen worker power, boost worker income, and increase corporate transparency. Workers, the arguments goes, care as much about their employment as they do about corporate profitability, so they won’t advocate for a strategy that leaves them jobless, even if it is better for the short-term bottom line. “Simply put, when employees have an ownership stake in their company, they will not ship their own jobs to China to increase their profits; they will be more productive, and they will earn a better living,” Sanders said last year.
Some progressives have criticized ESOPs, with the argument that they are little more than tax breaks for corporations that don’t give workers real ownership of a company or a meaningful say in its management. ESOPs can also create tensions with traditional labor unions, as the latter seeks to organize workers, while ESOPs tend to blur the relationship between workers and owners.
The Weekly Digest
Premier Thought Every Thursday.
All of our recent essays and podcasts, delivered to you. Free.
Free. Delivered Thursday mornings.
