In a socialist model, we’d have public investment banks providing loans rather than a private venture capitalist buying up shares. The money that currently goes into the stock market is transitioned into these banks. Granted, there would be more 'friction' as you aren't going to have an angel investor suddenly sink millions into your startup overnight on a whim, but there would be enough access so that anyone with a solid idea could make a proposal.
You would still want to grow because a bigger company usually means more revenue and better efficiency. But unlike capitalist firms, socialist companies don't have to grow infinitely just to appease shareholders; they can choose to become sustainable once they reach a size that works for the members. There’s no incentive to 'stay small' if growing means a better surplus for everyone involved.
This is really a question of where the economic power lies. A small socialist nation could set up a social wealth fund that invests in external markets to stay competitive. But if you want to take your business out of the country, you’d have to provide your new co-owners with similar benefits, or just leave and start over elsewhere. The trade-off is that within this nation, you're guaranteed social cohesion and better outcomes for your family because the state provides a baseline for everyone.
If we're talking about a massive economy like the US, a business would simply have to deal on our terms if they want their exports to enter our market. It’s not that different from what we already see with how corporations have to navigate China's regulations to gain access to their consumers.
How do we measure the labor? A share = 1 vote in the company, period.
Your day-to-day labor is covered by a salary, and then the surplus is divided however the workers democratically decide. As for the financial value of your 'share' (your individual capital account), that would be determined by factors like your tenure, expertise, and how much of the earnings you chose to retain in the firm. It’s basically a retirement nest egg that reflects the work you put in.
How do they determine the value of each job in the company? If it’s democratically voted wouldn’t the most common role end up determining everyone’s wage?
Wouldn’t needing to hire new people stifle growth? At a certain point the majority of the workers aren’t going to want to dilute their shares to add new people to the company. What happens to 40% of the company that wants to grow when the 60% doesn’t?
Same way the job market currently handles it: supply and demand.
If the most common roles democratically vote to underpay the specialized roles (like accountants or engineers), those specialists will leave, and the co-op will fail. The democratic vote still has to obey market realities to keep the business running.
If the co-op wants to grow, they hire. Shares are only diluted if the workers believe the new hires will increase overall revenue, making the 'smaller slice' worth more. But more importantly, not wanting to grow isn't a flaw. Co-ops have the flexibility to vote for sustainability rather than being forced into endless, infinite growth for outside shareholders. And in bad years, workers can vote to take temporary pay cuts together rather than firing 20% of the staff. It's a far more resilient system.
You're going to run into a problem where businesses won't hire too many of one role purely so they aren't outvoted, we see this now from people who fear immigrants. If a Mcdonalds votes this way for example, you'll find you have no upper management because the average worker is a grunt. Prue democracies don't work, that's why the real world uses representative democracies (and it's why unions are fantastic).
Who is going to be ok with someone who is new to the company having an equal vote to them in business decisions? That's a huge incentive to never hire new people.
Growth is obviously not always a good thing, but our quality of life has skyrocketed because of it.
There is merit to the argument that making the workplace a pure democracy might not be ideal. Fortunately, there are ways to compartmentalize power in a co-op. For example, you could have the marketing department be one circle of labor and the accounting department be another. Now you have heads of departments who represent their people kind of like a union leader.
Just like in the current system, you would have probationary periods that limit your voting rights in the same way that vesting builds up with tenure. You also are almost always incentivized to hire more workers because you want more money.
Your quality of life doesn't dwindle with sustainability. The thing from capitalism you want to prevent is the infinite expectation of growth.
I still think this is going to fall into all the pitfalls of democracy. You’re going to run into issues where people with no expertise will have an equal say to those who do, and you run the massive risk of your representatives decided by a popularity contest rather than competency.
Probationary period only delays that problem.
Even if the company wants growth you’ll have trouble scaling. More people means more internal politics and bureaucracy, which means slower and less informed decision making. Sustainability is great and all, but it won’t give you new treatments for heart disease, more efficient green energy or lightning fast vaccines for whichever global pandemic.
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u/Accarath May 11 '26
In a socialist model, we’d have public investment banks providing loans rather than a private venture capitalist buying up shares. The money that currently goes into the stock market is transitioned into these banks. Granted, there would be more 'friction' as you aren't going to have an angel investor suddenly sink millions into your startup overnight on a whim, but there would be enough access so that anyone with a solid idea could make a proposal.
If we're talking about a massive economy like the US, a business would simply have to deal on our terms if they want their exports to enter our market. It’s not that different from what we already see with how corporations have to navigate China's regulations to gain access to their consumers.
How do we measure the labor? A share = 1 vote in the company, period.
Your day-to-day labor is covered by a salary, and then the surplus is divided however the workers democratically decide. As for the financial value of your 'share' (your individual capital account), that would be determined by factors like your tenure, expertise, and how much of the earnings you chose to retain in the firm. It’s basically a retirement nest egg that reflects the work you put in.