We love this paper, written by Garvin Gray (Jamaican). Please read it and think carefully about it. Bim!
The Profit-Sharing Act
To Correct a Flaw in Capitalism
October 6, 2008
Consider this scenario
I have an idea for a business. However, to guarantee a successful launch, I need four employees. I reach out to some friends and successfully convince four of them to come work for me. My best friend is my right hand man. He is paid $1,000 per week. One of the other three employees is paid $750 per week, and the other two employees are paid $500 per week. I sit them all down on the morning of the launch and beg of them to work hard and to do everything in their power to ensure that we succeed. I tell them they are stakeholders and that we are a team. I also tell them that for year one our targeted profit is $75,000. I watch them work hard throughout the year and at the end of the year the business makes a whopping net profit of $1.5 million. We throw a party and pop champagne to celebrate. At the end of the party my four employees come to me and ask me how much of the $1.5 million profit I will share with them. I tell them none of it, and I remind them that I owe them nothing, since they have all been paid their wages.
Questions
Why am I so wicked? And why has capitalism not been busy about correcting this obvious unjust flaw that negatively affects so many people all over the world?
Answers
Humankind is by nature evil, so we need laws to keep us in check and to protect us from each other. These laws usually apply to businesses too, since a business is considered a legal person. The world has grown accustomed to an unfair system of conducting business, where shareholders and executive management get rewarded and the worker gets exploited. This is a flaw in capitalism that urgently needs to be corrected. All the players in a business should be fairly rewarded. If a business is profitable all the employees should receive a share of the profits, in addition to their wages, since they are the ones who presided over the profit. If a business makes a loss, the employees should not expect anything more than their wages.
Solution
Businesses should be compelled by law to share at least 10% of net profits each year with employees, to be apportioned evenly among the employees. This should be required whether the business makes ten dollars or one zillion dollars. If businesses wish to give employees additional rewards and bonuses, based on say performance measurements, businesses should do so in addition to their employees' share of the 10% net profit. History has shown us that we cannot leave it to businesses to be fair and reasonable in compensating and sharing profits with employees. That is why we need legislation to ensure this. It is long overdue and now is the time for the world's working class to demand it.
Conclusion
Stop for a minute and think about how much better off this world would be if each year businesses were to share at least 10% of their profits with their employees, no matter how large or small that profit is. All employees would now have a real incentive to be productive and employees would become genuine stakeholders in businesses. The working class would no longer live from pay check to pay check and we would all have a better shot at creating secure safety nets for our future. Why should we work all the days of our lives for businesses that are very profitable then retire on a minuscule pension and a stipend from social security?
The time has come for the working class worldwide to reject this system and to call on our elected representatives to enact laws to protect us from the legal persons called businesses. No business can seriously argue that sharing 10% of profits with employees each year will put it at risk of extinction. Many problems in this world will be solved after this is done. Many of us will be able to do so much more to improve our lives, and to help the needy and marginalized all over the world.
The Profit-Sharing Act is what the world needs now. Who will lead the charge?
I'm no good at thinking, so I thinker.
Garvin G. Gray, MBA
Every country is great, especially Jamaica. Bonita JamaicaBeautiful Place. Amazing People.See you in Jamaica.
