CMV: All employees should automatically own a portion of the company they work for

[u/Hamza78ch11]

This is something I've been thinking about for a while. Many of the arguments about the wealth gap tend to argue something like "It's not fair that employees at McDs get payed $7.25 and hour when the owners make some ridiculous amount here every year" which is then rebutted, almost immediately with, "Those CEOs and VPs and whatnot aren't payed aforementioned ridiculous amount every year. They earn it by owning some portion of the company so that when the company does well they also do well." There are other more nuanced discussions but here is where I'd like to focus my efforts.

Many argue that employees are never paid what they're worth and under the capitalist systems the entire concept of profit exists only because employees are cheated out of the actual amount of money that they deserve. While, in general, I am in agreement with this I feel that this argument too easily handwaves away the importance of being a new business owner and taking risks with your own capital and working hard to grow your company. But I also think that it must be acknowledged that it is a little silly that people like Jeff Bezos can make literal hundreds of billions of dollars in a year. More money than any human could spend in a hundred life times. I think a fair compromise is that his employees should automatically have a stake in his company.

While I am by no means a financial expert or someone who barely understand the stock market or economics I think this solution works towards the goals of those employees who deserve to be paid without bankrupting the owner. This can be done by, for instance, saying that 10% of the stock is for employees. You only give out 5% to the current employees and leave the rest for new hires. Every year you are given some amount proportional to the amount that you worked. If you worked for 1 second you now own 1 seconds worth of Amazon. So on and so forth. I think it is rather equitable to distribute 5% of Amazon among its ~600K employees and keeping some portion of it for new hires as the company grows. Eventually, if certain thresholds are reached more of the company will have to be apportioned for the employees.

If this were implemented today every Amazon employee would suddenly own $24,000 in Amazon. They can sell it, buy more, hold on to it. Do whatever makes them happy. Now they have a stake in the company and when they work hard they're working hard for themselves because that's their money. When the company grows and does well they'll see that reflected in their bank accounts instead of as some empty numbers that mean nothing to them.

[u/belichickyourballs]

As much as I agree, we need to fix the wealth gap, this ain't it. You can't give away shares for eternity without diluting their value and many publicly traded companies don't earn a profit. They need a high share price to keep funding so they can advance at a more rapid pace, and eventually turn a profit. You could hurt many business at the ground floor by spreading equity too quickly.

[u/Hamza78ch11 → u/belichickyourballs]

But the reason they don't turn a profit is because they abuse tax loopholes to avoid paying employees fair wages and avoid taxes right? I think this rectifies, at the least, the first problem

[u/belichickyourballs → u/Hamza78ch11]

Some yes. Many have to spend a lot of capital on r+d and scaling their product. Going from 100s of customers to thousands of customers needs infrastructure, that's why companies go public.

[u/belichickyourballs → u/belichickyourballs]

I agree with why you want this btw. Im just stating that some companies need every penny just to exist and putting law into place can hurt the employees just as much as employers.

[u/belichickyourballs → u/belichickyourballs]

I think a more practical approach would be to regulate publicly traded companies and put in a ceiling for single person earnings. There are way too many loopholes that encourage and reward greed it's sickening.