I COME NOT TO BURY DEMOCRACY, BUT TO PRAISE IT. Like Matt, it wasn't my intent to greet Cherny and Baer's new magazine with a negative post, it just happened that I wandered into an article that I had to hack my way back out of. So let me take the opposite tack now and highly recommend Gar Alperovitz's piece on a progressive ownership society. He goes through the usual -- though undoubtedly important -- asset-building stuff, but I'm more interested in his rundown on employee-owned corporations, of which there are now nearly 12,000, with some mega-companies boasting revenue in the billions. Alperovitz notes that "[a] recent survey by Rutgers University sociologist Joseph Blasi, Rutgers economist Douglas Kruse, and BusinessWeek reporter Aaron Bernstein demonstrated that such firms have consistently higher productivity records than comparable non-employee-owned firms. Average hourly pay in ESOP firms is also significantly higher than pay for comparable work in non-ESOP firms. And employee-owners of ESOPs commonly end their careers with higher retirement benefits than others with similar jobs." Well sign me up.
I've long felt that the way we treat shareholder enterprises helps explain some of the economy's ills. Because the corporation is charged with turning a profit for a diffuse group of investors, there's no single entity in particular who can be be held morally accountable. So you had, a few years back, the overwhelmingly strange spectacle of market analysts blasting Costco for spoiling a well-run, highly profitable business model with absurd levels of generosity to the employees. That critique could only survive if Costco were responsible not to its employees or self, but to some theoretically sympathetic group of "shareholders" who were being wronged by the company's misplaced priorities. It's an attack that would make no sense if leveled against an employee-owned company.
Employee-owned corporations, though, are just one stop on Alperovitz's fascinating tour through alternative ownership models. Unlike Bush's ownership society -- which simply gives you the deed to financial risk and ruin -- Alperovitz's proposals imagine ownership in a far more progressive and socially responsible way. It's the sort of thing liberals should think harder about, and the first step is giving him a read.