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Comment by supster | Hacker News Reader

> Generally speaking, the inefficiencies of unions exist to protect the interests of the workers, who generate wealth for the company but more often than not do not have an equity stake in the business.

What if we paid workers meaningful amounts of equity? Would that perhaps reduce the need for unions bc the labor/capital divide starts to get blurred and then workers are able to share in the wealth they generate for companies?

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Workers tend to consume as much or more than they make in income, hence most workers would immediately liquidate their equity holdings in exchange for cash that actually improves their quality of life. The best move would be eliminating the inefficiencies in the private sector (i.e. Unions) and adding universal supplemental income via the public sector.

We already get paid in equity. Our 401(k) plans tend to be invested in stocks. I work for a public company, and could move 100% of my 401(k) into my employer's stock if I wanted to. What mainly distinguishes my situation is that I get paid enough to have money to invest.

But for people who work for private companies, equity gets to be more tricky, for instance due to varying levels of seniority, "golden" shares, and so forth. From what I've read on HN, my impression is that the senior shareholders screw the junior shareholders. Also, it may be impossible to figure out the value of such a company, i.e., for anybody to know what they're really getting paid.

This is a complex issue well outside of my personal areas of expertise, but I would certainly think that workers earning meaningful equity would induce them to act in the best interestes of the company, because their own interests would be better aligned with the company's interests.

> What if we paid workers meaningful amounts of equity?

How would you provide equity for public school teachers?

That's a great point. Maybe we should view the issue from two perspectives: 1) unions for government employees and 2) unions for corporate employees. Where maybe the solution for corporate employees is more equity compensation, and for gov't employees a formal union system makes sense. Though some have argued that perhaps the gov't should not be in the business of education, and perhaps encourage a voucher system instead.

In some ways public sector unions are worse than private sector unions. In the private sector, the stakes are higher; you can contribute to the bankruptcy of your company if you are too aggressive. You also can only negotiate with the company itself. Maybe you can get a boycott of products in some cases.

With public sector unions, bankruptcy is very hard to achieve. The union also isn't negotiating with the government agency; it's negotiating with politicians as well, who have aims other than efficiency. They want to get elected. If enough of your constituency is in the relevant union, there's going to be pressure to not negotiate as hard.

Look at e.g. public transit unions. The DC Metro is falling apart, station managers sleep at work, escalators don't work ludicrously often, repairs are shoddy, and the drivers aren't terribly good at driving their trains (seriously, since they disabled computer control it's started giving me motion sickness; I have never experienced this on other transit systems). Yet the union is asking for a raise.

>> What if we paid workers meaningful amounts of equity?

> How would you provide equity for public school teachers?

I don't subscribe to the neo-liberal idea of conflating money with value (or equivalently: to measure efficiency in terms of money). But one could theoretically ban salaried employment[1,2]. And structure public services as employee-owned corpration that bid on service contracts. On might create a limited monopoly, by requiring a license to eg: run public education. And the same could be done for police, prisons, fire departments, special forces, security services... Again, I don't think this is a good idea, and we do this to a certain extent already.

[1] https://www.jacobinmag.com/2015/08/knights-of-labor-jim-crow...

[2] https://en.wikipedia.org/wiki/Wage_slavery

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