| |
[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]
Re: HOMESTEAD: Fwd: Update on chat w/ King of Sen. Corzine's office
I totally agree with Vic Thorpe that employee stock ownership without employee
participation in control is a sham. It is not really an employee
stock "ownership" plan, but rather only an employee stock "accumulation"
plan. The first is an ESOP. The second should be called an
"ESAP" and given less beneficial tax and capital credit treatment.
In fact, the current effort on Capitol Hill to reduce the percentage of
company stock held by an employee retirement trust to 10% (which would
have killed the ESOP in 1974 but for Russell Long's intervention) might
be a good way to distinguish ESAPs from ESOPs (which should continue to
be allowed to be invested 100% in company stock where employees are given
first-class shareholder rights.
An even better way to ensure governance rights from the bottom-up is
to allow workers to set up a Capital Homestead Account at their local banks,
where they and each member of their family can receive annually low-cost,
self-liquidating and insured capital credit (monetized under Section 13
of the Federal Reserve Act) to invest in full-dividend, full voting power
shares issued by the companies for which a member of the family works.
This would mean that corporate executives would have to come to the workers
for the money, rather than have ownership rights trickling from the top-down.
This could also be woven in a new, more democratic approach for saving
the Social Security System from going over the cliff, while avoiding the
Wall Street speculator's model of privatization. (Click on http://www.cesj.org/homestead/reforms/other/savingsocialsecurity-nk.html
or go to How
to Save the Social Security System for an out-of-the-box plan that
would provide each citizen from birth with non-recourse credit of $3,000
each year, which would provide that person with a retirement income of
$30,000 in annual dividends based on an accumulation of $200,000, plus
$750,000 in second incomes from dividends during the years of accumulation.)
I suggest that, from some experience, that when COG invests time to
persuade Congress to advance the cause of employee ownership, go with a
bold approach, one that can excite the imagination of ambitious legislators,
not tokenistic requests.
Norm Kurland
Center for Economic and Social Justice
Web site: http://www.cesj.org
Vic Thorpe wrote:
Deb,Noting
the reference in your copy letter to the Enron stock situation, here is
one summary report of the situation that has hit employees' 401K and other
arrangements. It is a scandal of corporate governance and underlines
the need for employees to have a defining say over what happens to their
own money - rather than allow company managements, or pension fund managers,
to treat their employees future income as if it were a corporate slush
fund. It is the best argument against employee stock ownership without
employee participation in its control that I can think of.Vic
Dear Homesteaders:
Attached is a portion of the email I sent Gene Fisher
of Congresswoman Carolyn Cheeks-Kilpatrick's office regarding the Fair
Exchange (SQPQ) proposals I have been working on at his request. Based
on my discussions with him and Senator Levin's staff, I was asked to send
the proposals to Senator Corzine who drafted the Airline Bailout bill proposals
on equity compensation for the government. I would appreciate your thoughts
on how to craft these proposals to meet the needs of the policy makers
as expressed by them. The actual requested language I sent to Fisher and
King are in my last posting to Homestead addressed to David Ackerman
of the ESOP Association Legislative and Regulatory Committee.
Deb
Date: Wed, 05 Dec 2001 18:06:43 -0500
From: Deborah Groban Olson <dgo@esoplaw.com>
Subject: Update on chat w/ King of Sen. Corzine's office
Dear Gene:
Today I spoke with Bruce King of Sen. Corzine’s office.
He understands the idea that global hegemony is moving from nation states
to corporations and why that is a problem for democracy. He is willing
to look at proposals. He is not interested in pushing stock ownership right
now when the market is down. He feels that now is a bad time to push ESOPs
because so many people, including employees, lost their shirts in Enron
stock, etc. (I think he said that employees were obliged to own stock at
Enron.)
He also thinks that if the government gets reimbursed
by corporations for government investments, all taxpayers benefit. I think
that is true on the macro level. However, it is dependent on how
the government, at any particular time, allocates those funds. An equity
stake to the government doesn't do enough to build a second stream of income
for citizens or give them voting rights in the increasingly powerful corporations.
Now , when global companies are needy and coming to the
US government to invest in them, is an opportunity to get US citizens a
needed financial stake in the global economy. This investment stream of
income will be increasingly important in for all US citizens in the near
future. Now that the Social Security Fund is expected to be underfunded
in 15 years and both technology and globalization are decreasing
the number of US jobs needed to produce goods sold in the US, wage income,
social security insurance or individual development accounts will not be
an adequate source of sustenance for an increasing number of Americans.
Perhaps the forum in which to join this issue is not employee ownership,
but instead social security, unemployment or trade.
Congress should not miss out on this opportunity. During
the next stock market upturn, the companies will not need government help.
During the following downturn the process of corporate hegemony will likely
have progressed.
Bruce King is willing to look at more proposals, but
he wants the draft proposal to have more timely political resonance that
does not smell of underwater stock options, and devalued ESOP stock.
Do you have any reaction to:
1) The proposals I sent in the email to King.
2) These comments on King's reaction.
3) How to frame the issue to make it politically attractive?
Many thanks for your time and interest.
Deb Olson
Deborah Groban Olson
Attorney at Law
of counsel to
Jackier, Gould, Bean, Upfal & Eizelman, P.C.
1021 Nottingham Road
Grosse Pointe Park, MI
Phone:(313) 331-7821
Fax: (313) 331-2567
Email: dgo@esoplaw.com
Web site: www.esoplaw.com
for information on employee ownership, equity compensation, and capital
strategies, www.jackiergould.com
for information on general business law practice.
This message is
intended for the sole use of the individual or entity to which it is addressed,
and may contain information that is privileged, confidential and/or exempt
from disclosure under applicable law. If the reader of this message
is not the intended recipient, or the employee or agent responsible for
delivering the message to the intended recipient, you are hereby notified
that any dissemination,distribution or copying of this communication is
strictly prohibited.
|