Review of the new book, The Citizen’s Share: Putting Ownership Back Into Democracy
As reviewed by: Joseph Cabral, Immediate Past Chair of the Employee Ownership Foundation, Thousand Oaks, CA
Editor’s Note: Book reviews are not a regular feature of ESOP Association publications or social media.This article originally ran in the January 2014 issue of the ESOP Report, the newsletter of The ESOP Association. We are sharing the following information as a service to members of the ESOP community.
As Chair of The ESOP Association at the turn of the millennium, I called for The Great National Debate on Employee Ownership. The second year of my term, the debate talk disappeared as we defended employee ownership in the wake of Enron, Worldcom, and United Airlines. Although the problems with these companies were not the result of broad-based employee ownership, the inclusion of employee ownership made it difficult to overcome the argument that employee ownership was somehow involved in the failure.
The opportunity to advance employee ownership was given another chance when in 2002 President George W. Bush proclaimed his belief in an Ownership Society. The ESOP community was excited at the prospect of the President endorsing the idea of an Ownership Society and just as quickly disappointed when he restricted the definition to home ownership.
A new book, The Citizen’s Share, opens up yet another opportunity to debate the ownership issue. Authors, Professors Joseph R. Blasi, Richard B. Freeman, and Douglas L. Kruse, provide readers with the foundation to have the Great National Debate on Employee Ownership. The authors themselves seem to desire such a debate as they write, “Following American thinking about broad-based ownership and having a citizen’s share in society from the 18th to the current Century can, we believe, help us develop a road map to increase the citizen’s share of our economy. That is the purpose of this book.”
The authors take us on a journey through American history starting with the Founding Fathers, through the Industrial Revolution, to today’s information age. The authors provide documents, speeches, and quotes from our Founding Fathers warning readers of the consequences if wealth producing property is not distributed fairly. The country was founded by people escaping their homeland’s aristocracy that choked opportunity for upward mobility and the accumulation of wealth. Inherited wealth and power was the societal norm. What they sought was a land where freedom and liberty could be the principles for the founding of the country.
The authors follow the agricultural roots where most people could create wealth by farming their land and the beginnings of the industrial age, when cod fishermen participated in profit sharing associated with their catch, to the Louisiana Purchase, which added sufficient land for the new citizens to own, to companies that provided profit sharing and share ownership to employees in the industrial, and now, information age.
Today, we are concerned about the unsustainability of the current system. The public generally take exception to the current outcome but seem to have accepted, “the rich get richer and the poor get poorer,” as inherent to the capitalistic system.
The authors point us to a series of questions on the General Social Survey that are specific to broad-based ownership (the series of questions was supported by funding from the Employee Ownership Foundation) for a counterpoint to the conventional wisdom that shared ownership is insignificant in our society. The authors note the study discloses that “about 47% of private-sector full-time wage and salary workers have some form of shared ownership in small amounts, except for ESOPs, in the firms where they work.” Such ownership takes the form of profit sharing, gain sharing, as well as ESOPs. Thus, shared ownership is indeed a significant part of our society and there is a need to expand shares and expand the level of wealth they represent.
Our ESOP community knows the outcome of our capitalistic society does not have to result in greater concentration of wealth. In fact, ESOPs stand as testimony that broad-based ownership of wealth creates greater wealth in our nation and shares that wealth more fairly among those who helped create the wealth, making us all capitalists.
The authors cite a late 19th Century congregational pastor, William Gladden, who addressing rising tensions over wealth inequality and horrible working conditions suggested the solution was what he called cooperation, “by making the laborer his own capitalist.” Those of us in the ESOP community understand the impact of employee ownership through ESOPs and The Citizen’s Share provides us with the evidence, arguments, and historical material to rebut our naysayers. Now is the time to make our ESOP voices heard by not just our fellow ESOPers but by the public-at-large.
The Citizens Share is a must read for all in the employee ownership community and the rest of the American public. Read it and pass it on to all you know. If we all make sharing our ESOP story a priority, we can make a difference and make our nation a more just and economically fair society.
For information on where to purchase a copy of The Citizen’s Share, click here.
The Citizen’s Share: Putting Ownership Back Into Democracy, authored by Joseph R. Blasi, Richard B. Freeman, and Douglas L. Kruse, published by Yale University Press, ISBN: 978-0-300-19225-4.