Recent proposals to grant workers equity in the economy have been met with skepticism by those who fear that radical intervention in the market inevitably paves the road to serfdom. But profit-sharing schemes, if designed properly, could be an ideal response to today's dangerously high levels of inequality.
NEW YORK – At the British Labour Party’s annual conference in Liverpool this month, the shadow chancellor of the exchequer, John McDonnell, proposed a profit-sharing scheme that would grant workers equity in the firms where they are employed. McDonnell raised this idea in what was decidedly a political speech; and policy experts and economists have reacted skeptically. While a poorly executed profit-sharing program could do serious damage, that is no reason to reject the idea altogether. It is in fact a good sign that the idea is being publicly defended by a political leader.
NEW YORK – At the British Labour Party’s annual conference in Liverpool this month, the shadow chancellor of the exchequer, John McDonnell, proposed a profit-sharing scheme that would grant workers equity in the firms where they are employed. McDonnell raised this idea in what was decidedly a political speech; and policy experts and economists have reacted skeptically. While a poorly executed profit-sharing program could do serious damage, that is no reason to reject the idea altogether. It is in fact a good sign that the idea is being publicly defended by a political leader.