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r/Futurology•
level1

A plan to address the issue of technological unemployment: Stock Redistribution

There has been a few good discussions on this forum about the issue of technological unemployment, the idea that robots and other technologies will put millions of people out of work and force radical economic change. To date, the only specific plan I have seen to address the issue, besides simply expecting the free market to fix it for us, is to tax heavily and redistribute the wealth. I would like to propose an alternative.

Most companies and corporations in the United States use a system called "stock". Each "share" of stock represents a tiny percentage of the ownership of the company. Even if a company has not "gone public", that is, not chosen to sell stock on the open market, stocks usually play a role in the bureaucratic process of determining who has a stake in the company.

Corporations in particular are run as a kind of democracy, where each shareholder is entitled to vote for the members of the corporation's "board", a group of people which make high level decisions like choosing the CEO. Each shareholder's vote is proportional to how much stock she owns.

My plan is to require all companies in the US (or whatever country this plan is implemented in) to provide a small percentage of the available shares to a general account, where it is redistributed equitably to every adult citizen. I call this "Stock Redistribution". These shares are freely tradable, and selling these shares can be a form of income of the poor.

The percentage of shares going into the general account should be planned such that, over a period of 20-50 years, every company will eventually be 50% popularly owned. This way, a new start up is completely owned by its founders and those to who contribute capital, like it is today. A period of a few decades should provide plenty of time for the initial stakeholders to profit handsomely from the business, so this redistribution system will reward innovation in much the same way as today. The system could be planned so that the initial stakeholders never see their ownership percentage go to zero or below a certain percentage, if that is what we decide is best.

It is important to plan this system such that it does not encourage the government to attempt to run these corporations ala socialism. Instead, the shares are owned by the populace directly, and systems should be put in place that allow average people to participate in corporate democracy and feel like they truly own and control these corporations.

I realize that this is somewhat radical, and I hope that you all have constructive critiques. If the idea is in any way impractical, I'd love to hear your counter-proposals. That said, I'm not particularly interested in arguments that come from the moral interests of the wealthy that would be marginalized by this system; I actually don't care.

Posted Dec 9, 2012, 9:44 AM UTC

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mn108•

Interesting concept. A couple immediate thoughts;

  • poorer people may still need to sell their shares to survive and thus you gradually end up with concentration of wealth and ownership issues
  • companies that don't like gradually sharing ownership move their companies to countries that don't share this system.
  • corporations come up with other ways to avoid "social dilution" for instance by spinning off pieces into new "start ups"
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Sojourn5•

The people who profit the most from the current economic system are the very people you would have to convince in order to affect this change. If you play by the rules and and try to affect change, you will fail. It will take something drastic to change/get rid of capitalism.

"Poor people are not rich people without money." -Andrew Urich, bus. law professor

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ion-tom/r/Simulate•

Did you see Warner Buffet on the Daily Show? The guy sounds like he'd support something like this.

Get enough credible people to make a statement about it and it becomes political. Once that happens and everyone know about the idea, people can fight for it effectively.

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lopting•

Buffet is an exception. He's at the top of the heap, with nothing more to prove in the capitalist system. It's mere multimillionaires that would put up the most fierce resistance, not the top 5 wealthiest capitalists.

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[deleted]•

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Lastonk•

how about instead,

ALL publicly traded companies must give ten percent of their shares to the national Government and that these shares must provide dividends.

In addition, no single entity may own more than 45% of the shares of a publicly traded company. (ahem, including the government)

This government is then required to take all dividends of all stock owned (even over the 10%)and redistribute this money, divided equally among all citizens of that country. For people to do with as they please.

If a company does not want to be publicly traded, that's ok. But if they are, they must submit to the chance that the state will act as a tie breaker in disputes, will act as a monitor of a companies values, and will be involved in a companies health. they will also not be the only say in what that company does. Checks and balances.

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Lastonk•

just publicly traded shares. The government gets ten percent of all public shares in a company. seems fair to me. harder to cheat on taxes that way.

You can of course buy shares of stock back, removing them from circulation and end up owning your company again.

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Lastonk•

naturally that ten percent would go to the country it's issuing stock from. and yes, that's going to be a HELL of a lot of money. I'm okay with the strangling business thing, if it prevents starving people and massive unemployment riots.

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mcscom•

A good concept for sure. I think some form of this would work well to make corporations more accountable to the common good. In addition, it provides a novel means of balancing social concern with the need to allow some capitalistic freedom for innovation and rewarding successful entrepreneurs.

I agree with the criticism raised by mn108 and robolib however, this would lead to a natural flow of stock right back into the hands of the rich as the poor are forced to immediately sell their stocks in order to eat.

In addition to this, I think a good proportion of the lower classes might lack the motivation and intelligence (I know it sounds elitist, but its true) to be productive stock-holders. By and large they might simply get taken advantage of by predatory stock buyers.

Perhaps as a slight adjustment to your proposal, maybe this popular stock could be non-exchangeable. I know it rather reduces the dynamism of the system, but this would avoid the problems of funnelling the stock back into the hands of the few. In this case, the stock would provide popular dividends for everyone, so as a company does well a certain percentage is redistributed to everyone to provide for basic needs.

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ion-tom/r/Simulate•

Just had a very long and similar conversation on another thread here:

http://www.reddit.com/r/Futurology/comments/14kac6/what_will_be_the_longterm_impact_and_development/c7dvd2j

An idea I've had is a digitally encrypted currency that redistributes if not spent in a short enough amount of time. Money flow is most important for a healthy economy. Pooling it up for speculation is what can lead to things like Greece.

"Smart" money would be able to nearly regulate itself (especially if encrypted on a quantum network or anything similar). And that automated self regulation could help beat back some of the bureaucratic bullshit that goes on, and could even give ever cent a complete ownership history. (Could be made partially anonymous, but give visibility into shit like political donations.)

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uppitywetback•

I actually kind of like the idea he's trying to articulate. One big reason is that the corporation, by definition, is state 'interference' with the open market. Immunity, limited liability, etc. are large encroachments into what would be understood to be a pure free market.

This actually goes to the "you didn't build that" issue. Rather than making it a rhetorical, political blather, let's say what the truth is: that corporations get large, and shareholders profit, due to the influence of the government. Let's stop talking and have the corporations put our money where their mouth is and provide an ownership interest to the public. With the appropriate restrictions (limited percentage, no private transferribility) it could go a long way to 1. aligning profit motive with the general welfare; and 2. providing an equal distribution of wealth in the country.

Of course, the unintended consequences would be a large problem, but not an insuperable one. Especially if it forced the electorate to educate themselves about the true cost of government, and the costs of their political decisions.

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gotapresent•

A lot of people don't even vote or participate meaningfully in our national democracy. I can't imagine most people would have the time or inclination to pay attention to each of the thousands of different companies they'd have shares in under your idea.

Systems that vest direct power in the hands of individual citizens aren't really workable for the same reason you don't have a hundred million people voting on every single piece of legislation that goes to the president's desk.

Honestly if your goal is to have public ownership of a company to realign its interests towards the public good, government ownership is a far simpler and more viable solution.

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