Labour finds a radical new idea
John McDonnell’s speech at the Labour party conference was no triumph, but it did at least get people talking.
John McDonnell's big Labour conference speech "was hardly a rhetorical triumph", says the Economist. However, the shadow chancellor's proposal to force firms to give shares to their workers "has provided the Labour Party with the closest thing that it has to a radical new idea". Although the specific plans are "badly worked out", even critics will have to agree "there is an interesting debate to be had" about employee ownership.
"To say there's problems with it is an understatement," says Sam Dumitriu on CapX. While employee ownership is common in Silicon Valley, "what works for Google might not work for Marks & Spencer". In any case, what McDonnell proposes is "stock that can't be sold on" with most of the money going to the Treasury. The new rules could also hit employment "firms that are close to reaching 250 employees "might put off hiring, or outsource jobs to a subsidiary". Overall, these measures "would see innovation squashed and workers left out in the cold".
Not so fast, says Aditya Chakrabortty in the Guardian. The proposals aren't "perfect", and caused "outright war" when they were tried in Sweden, but something needs to be done. Workers have "been getting smaller and smaller slices of the pie", as Andy Haldane, the Bank of England's chief economist, has noted.
"Employees get proportionately less now than they did at the very outset of the Industrial Revolution in the 1770s." Yet this is not solely about money it's about giving people "a stake and a voice in the enterprises in which they spend most of their waking hours".