An new employee-based model for businesses:

[Jackpine Radical]

The workplace has proved itself incapable of providing adequate health care and retirement plans for its workers. This is particularly the case with small and start-up companies, who lack the advantage of large employee pools. The result is a damping of creativity in the marketplace. People are less likely to engage in risk-taking and innovation when they must sacrifice access to adequate health care and retirement financing in order to do so.

Thus universal health care and a fully funded government retirement system would result in the creation of many new small businesses in new areas such as green technology, precisely where they will answer the emerging needs of society. I believe this system has the potential to stimulate what is best about the profit motive while eliminating some of the worst problems of the current system.

A model for a company in the coming age:

The company will be worker-owned. You will earn increasing shares in the company as a function of the number of years you are employed in that company. If you leave the company for any reason, you may hold your shares until your death. However, when you die, the company will give your estate a fair cash settlement for your share and the remaining workers will retain ownership of the company. This is necessary in order to keep ownership from spreading out among people who have no vital interest in the company.

Not all workers will have an equal share in the company. For example, it would be expected that the entrepreneur who starts the company will retain a larger share of ownership than the other employees. Also, shares in the company may be differentially assigned on the basis of the type of work done. Each worker will receive wages or salary commensurate with their job responsibilities, and in addition each will receive a share of the profits commensurate with the number of shares they hold. Thus every worker will have a stake in making the company more profitable in the long run.

[FarCenter]

1. It can be done.

http://en.wikipedia.org/wiki/List_of_employee-owned_companies

WL Gore and Associates makes the well known Gore-Tex waterproof fabric.

[Jackpine Radical]

2. (Johnny Carson voice:) I. Did. Not. Know. That.

Seriously, thanks for the information.

[FarCenter]

7. Startups often conform to your model

A few people get together and start a company, each with shares of the companies stock. As they bring in more employees, they may provide stock options along with salary. Typically, the early shareholders get diluted if the company is a success, since they need more capital and have to sell stock to outsiders.

SAIC was originally an employee owned company, and its founder was quite an avid proponent of employee ownership. However, it is now publicly traded.

Some issues concern how to value a share of stock which is not traded in a market place. What SAIC did was annually bring in consultants to value the company, in the same manner as an investment banker considering the acquisition of the company. Then the company would buy in stock that employees wanted to sell. It would also sell stock to employees at the same price. They also maintained all the stockholder records, and did all transactions. Employees could not sell stock to other employees, retirees, or anyone else.

[Speck Tater]

3. That would not work for some types of business

There are businesses with a relatively small number of employees but a HUGE capital investment in equipment. Oil refineries come to mind, as do computer chip manufacturing companies. Where will you find 150 workers wealthy enough to buy into a company that requires 150 million dollars worth of equipment just to get into business? Who is going to spend a million dollars to buy a job that can only pay $50,000?

[scribble]

4. A good start ...

but not every company needs resources in the same amounts. Some companies need more land or more capital, or more outside partnerships (example: sales people) than others do. Other companies need more customers or need to compete in a more volatile industry, or need to provide a very highly skilled service (medicine; high tech; law). These all change the nature of the problem you are trying to resolve.

These are not show-stoppers; just problems that an an economy comprising employee-owned companies would need to manage.

[Jackpine Radical]

9. That's what credit unions are for.

Selling stock isn't the only way to raise capital. Credit unions would be investing $$ from community members.

[Luminous Animal]

5. The Mondragon Corporation employing 83,000 people in 256 co-ops

The MONDRAGON Corporation is a corporation and federation of worker cooperatives based in the Basque region of Spain. Founded in the town of Mondragón in 1956, its origin is linked to the activity of a modest technical college and a small workshop producing paraffin heaters. Currently it is the seventh largest Spanish company in terms of asset turnover and the leading business group in the Basque Country. At the end of 2010 it was providing employment for 83,859 people working in 256 companies in four areas of activity: Finance, Industry, Retail and Knowledge. The MONDRAGON Co-operatives operate in accordance with a business model based on People and the Sovereignty of Labour, which has made it possible to develop highly participative companies rooted in solidarity, with a strong social dimension but without neglecting business excellence. The Co-operatives are owned by their worker-members and power is based on the principle of one person, one vote.

http://en.wikipedia.org/wiki/Mondragon_Corporation

[Luminous Animal]

6. Hippie Capitalism: How An Impoverished U.S. City Is Building An Economy On Co-ops

http://www.fastcompany.com/1837285/hippie-capitalism-how-richmond-calif-is-building-an-economy-on-co-ops

“There’s not a lot of help coming from the federal government, or the state government,” says the city’s Green Party mayor, Gayle McLaughlin. “So we’re kind of on our own.” Two years ago, she went all the way to Spain in search of another economic model that might reinvigorate her city, once the locus of bustling shipyards that produced hundreds of boats for battle during World War II.

....

“I found that the values of people in Mondragon were very much in line with the values that we were putting forward as part of our political movement in Richmond: standing for equity, standing for justice, standing for community empowerment,” McLaughlin says. And so she brought the idea back to California and hired what is probably the only official municipal worker co-op consultant in the country. As of January, the first co-op born from this campaign, the aptly named Liberty Ship Café, is up and running, with plans for new bike shop, bakery, urban agriculture, and solar installation co-ops on the way.

[HiPointDem]

12. wow. that was my idea, that cities/counties put the money they now spend on tourism &

business "consultants" (who, in my community, have recommended stupid things like putting up flags and planters to make our downtown more "attractive" to those big investors who are going to show up any day now, yeah, right) into start-up funds for public businesses.

[Zalatix]

8. Is that similar to how things run in Germany, by any chance?

[Jackpine Radical]

10. Das kann ich nicht sagen.

Ich weiß sehr wenig über deutsche Geschäftsmodelle.

Translation: Beats the shit out of me.

[Zalatix]

11. Regardless, there should be more rec's for this thread.

This is a huge step forward for a capitalistic society.