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Michael Peck's blog

Building an Ownership Economy

“In this nation I see tens of millions of its citizens, who are denied the greater part of what the very lowest standards of today call the necessities of life. I see millions of families trying to live on incomes so meager that the pall of family disaster hangs over them day by day. I see millions whose daily lives in city and on farm continue under conditions labeled indecent by a so-called polite society half a century ago. I see millions denied education, recreation, and the opportunity to better their lot and the lot of their children. I see millions lacking the means to buy the products of farm and factory and by their poverty denying work and productiveness to many other millions. I see one-third of a nation ill-housed, ill-clad, ill-nourished.”
- FDR’s Second Inaugural Address, January 20, 1937 -

If things were supposed to get much better in the intervening 76 years, they have not. America’s pursuit of wealth inequality has created the highest percentage of absentee ownership since pre-colonial times. Instead of nourishing a vibrant middle class ownership society, America produces more oligarchs and oligopolies. The worst of these conspire to buy elections, park their wealth in overseas tax havens and then target local government subsistence programs for political extinction.

After four decades of outsourcing, American cities and outlying rural regions face profound geographical inequality. End of the line survivors like Buffalo,  Youngstown,  Toledo,  Detroit, and Flint,   and their working class populations, make do with   industrial pollution, decaying public buildings, roads and bridges, unyielding structural unemployment, under-funded schools, and a level of social mobility worse than many developing nations’.

According to a Ford Foundation-sponsored project, “The Great Divide: Global Income Inequality and its Cost,” that compares American cities to other countries in terms of income inequality, America has reached a tipping point; now there are few countries able to compete with the U.S. in this “race to the bottom,”  In a similar study, the Organization for Economic Cooperation and Development (OECD)  ranked the U.S. below every developed country in this grouping except for Chile, Mexico, and Turkey.

In this social Darwinist future, only a few are predestined to succeed. Generationally-imposed geographical, ethnic, and racial chains wrap themselves around the ankles of American children who never get to experience the equal opportunity that America should offer everyone. Auto workers, steelworkers, foundry-men, and textile workers who used to have good paying jobs now stand in unemployment lines. The idea that hard work would pay off did not hold up.

While convenient, it’s unfair to blame this on China.  Ultimately, we did this to ourselves. Yes, China provided the outsourcing excuse, but American capitalists and politicians took advantage of it.

After forty years of unchecked financial engineering, America ended up at the foreclosure doorstep of the 2008 Great Recession. Now, half the country can’t afford to buy products that are made anywhere but here and federal policy has failed to revive the economy.

Clearly, the path forward is to revalidate ourselves. As economist Paul Krugman explains, “workers aren’t bushels of wheat or even Manhattan apartments; they’re human beings, and the human relationships involved in hiring and firing are inevitably more complex than markets for mere commodities.” We need to focus on building a New Ownership Economy.

In the U.S. alone, member-owned organizations account for $3 trillion dollars in assets, $500 billion in revenue and more than one million jobs. There are more than 15,000 employee-owned companies throughout the United States, 11,000 of them with employee stock ownership plans.  Companies with broad-based ownership are more stable than those without it – with fewer job losses, those companies outperform ones where executives make a killing and workers do not.

America’s New Ownership Economy connects these corporate populations with the 350 million memberships that Americans hold in 29,000 cooperatives nationwide to provide heft and substance to the import and dimensions of building out Stakeholder America from the middle-out.

Our goal is to build a culture that empowers stakeholders. We look toward worker friendly crowd-sourcing by irrepressible local movements and worker-owned companies that swarm and intra-reinforce, churning upwards to a new virtuous economy plateau. Incentivizing workers as owners in “doing well by doing good,” New Economy projects and businesses reflects core American values of self-reliance, community solidarity, and equal opportunity reinforced by ownership principles and practices as ineluctable components of a reinvigorated American dream.

The returns on democratically expanded ownership models become improved by exhibiting self-reinforcing customer satisfaction through higher accountability, productivity, and efficiency. Shared common goals, principles and practices broaden the definition of value above and beyond the “bottom line” and into the peoples’ quadrant of a better, more responsive and just marketplace geometry. Instead of seeing our fellow workers everywhere in chains of economic emptiness, we find economic freedom through ubiquitous and equal opportunity worker ownership as the defining proof that capital is subordinate to labor.

It is heartening to see a member of Congress, Rep. Chaka Fattah of Pennsylvania, propose a National Cooperative Development Act which would provide loans and advice to communities working to build cooperatives. While the bill failed, it is a clear recognition that we need to move away from a single-minded focus on the “bottom line.”

Michael Peck is the Founder of the MAPA Group and Board Member of the American Sustainable Business Council Action Fund.

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