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This is probably tone deaf, but instead of giving the auto workers more money or open more factories, what if they gave them stock grants? If you gave them stoc
by mateo411 7y ago
This is probably tone deaf, but instead of giving the auto workers more money or open more factories, what if they gave them stock grants? If you gave them stock, they workers wouldn't want to open factories that would cause GM to lose money. It would keep the worker and the management incentives aligned.
- cagenut 7y agoNot sure if you're being clever or just defined socialism by accident.
- hanniabu 7y agoWhy is it that anytime a discussion about massive companies paying workers more comes up, that somehow somebody thinks this is socialism. Employees deserve to be fairly compensated.
- phildawes 7y agoHe's saying that by getting stock grants the workers own the means to production (=socialism, sort of)
- shadowgovt 7y agoProbably because "employees deserve to be fairly compensated" is a concept from communism (not socialism, but Americans get the two confused all the time) as soon as you divorce "fairly" from "what the employer and employee agree to in a free labor market." That's not a bad thing, but it's how the definitions and philosophies flow.
- chadcmulligan 7y agoThe capitalists have a way better marketing arm than the communists to, which contributes to the argument
- zarkov99 7y agoNobody "deserves" anything. The market is not just for products.
- gok 7y agoThe UAW's trust did own half of GM in 2009, then proceeded to sell almost all of it and lost their board seat. Turns out a company with a lot of overpaid employees and out of date products is a lousy investment.
- mdasen 7y agoEven given stock, the workers would prefer unprofitable factories because the stock would be a smaller portion of their compensation compared to lost wages. The problem with stock compensation is that a worker’s incentives aren’t that of an owner. Let’s say that you give them stock, they hold the stock, and the company hits hard times. Now they’ve lost both their job and their savings. That’s bad. Let’s say that you give them 5% of their compensation in stock. They would keep wanting to make unprofitable factories because their stock compensation is minimal. Let’s say 80% of their compensation is stock. They’ll need to sell it to cover living expenses and so you’ve just given them cash with extra steps. The ownership mentality only works if you’re dealing with rich people (like a CEO) that can defer realizing their compensation and where you’re willing to grossly overpay them.
- evancox100 7y agoI thought it was common in the auto industry to have profit sharing as part of compensation. Not exactly stock, but similar.