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A solution for the workers

This is the second attempt M. Sarkozy is trying to save big hiring companies from going out of business. SeaFrance has gone bankrupt and a Tefal factory will be putting out of work about 500 more very soon in a remote area of France.
The proposition that is coming all the time in order to save the situation is the participation to the company capital as it's going bankrupt; of course, who wants to bare the risk in a moment when banks gives no more credit to the failing companies.
So the idea is that in order to make everyone accountable for a company's success and perenity, Government may see a way to impose to company they have help built and save from bankrupcy to open their capital to their workers up to 30%. The deal can be put in formula that includes the reduction of the salaries relatively to the gain the shares will be providing to their income.
In that way, the workers will be sharing the success of the companies, they will never oppose a decision to cut in expenditures, the company will gain in competitiveness as the cost of production will decrease. It will be more difficult for managers to sell off a company who is still profitable, even if the profit level does not feet the thirst of capitalist tycoons.
The mesure can be a job saving system for the whole occidental countries experiencing job crises and debt crises.
I am not a specialist, this is just an idea to explore...

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    Jan 21 2012: The deal is about giving ways to fix participation in the capital, not to speculative shares. It is an exercise that will take place when the company has done proof of profitability.
    One mistake people make today is the amalgam between the margin investor make in the speculative market and the margin they make out of the actual activity of the company. This is what is killing most of these companies today, as the allow themselves levels of borrowing that do not reflect the real health of the company.
    As employees have a share of the decision in company's spendings, and politic of expansion, they can decide whether they want to risk more or secure they investment.
    The main point is to balance the danger of the exposure of company in a speculative system, which has more to do with casino games than growth in the real economy.
    Besides, I have said that it is an idea that will need to be explored by specialists. Only under a constructive thinking by proffessional, we 'll outline corsage for the activity.
  • Jan 20 2012: Firstly, your assumption is that the employee capital will be enough to save the company from bankruptcy. Is it a one lump-sum deal, or an ongoing cost that the employee's will have to continually service?
    Secondly, is it compulsory for ALL employees, no matter what level of seniority or salary, will have to put a set percentage?
    The idea shares the same premise as to why companies give stock/options to their employees, and so also shares the same flaws behind the thinking.
    It's not perfect - it's an alternative, sure, but not one I would think realistic.
  • Jan 20 2012: If I understand correctly, it's suggested that companies given government bailouts are required to give 30% of their shareholdings to their workers. My challenge is that it is not the government providing the bailout - it is the taxpayers. So the true situation is that the entire taxpayer population gives money to a failing company, and then that failing company is restructured so that the employees own a minority shareholding. It seem the deal is not a good one for the taxpayer. I suggest that a better solution is to let the company fail and then the workers and management can buy it from the administrators. They will be able to get private finance if it is a good company. This is capitalism - good companies thrive, bad ones fail. Interfering by government bailouts creates moral hazard and is bad for everyone.
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      Jan 20 2012: I have said that 30% should be given for free, it will be payed by the employees themselves. Besides, I have taken a clear example of Seafrance, which just failed in France. Most of the reason the company fail is that the Mother conpany which is SNCF, partly owned by the french government has decided to close the branch as they are not getting the level of profit the hoped they had. So the easy way for them is to close it down and go on. But then unprepared workers (about 880) have now to face two choices: either they accept that their firing indemnisation is used to constitute the fund to run the new company, or they just accept without any notice to go on wellfare. It is not an easy choice.
      I do believe this is a capitalistic system, but if we do not give it a human figure, it will be definitely failing us all. Many people are stressing today the failure of the system, and most economist do not have a clear view as per how to handdle it, the solutions might not be laying in their traditional capitalistic way of things.
      I believe there are alternatives.