Robert Ashford has written about his proposal for a better, inclusive capitalism, but I don't understand the method. For example, take a look at this article. All is very obscure. It seems to be about paying workers with shares, but I don't quite understand it. Why would companies expand their shares? That lowers their price. Can't see how this would work. Is anyone familiar with his proposals?
Robert Ashford has written about his proposal for a better, inclusive capitalism, but I don't understand the method. For example, take a look at this article. All is very obscure.
Can't see how this would work.
The article is altogether too sketchy, idealistic, contradictory, very flawed, with too many unfilled gaps and motley elements. Much of it sounds like campaign promises, but a "broader distribution of capital acquisition and income" is not the panacea the article purports.
Initially, the authors admit that "production generally becomes increasingly more capital intensive" (p.70) and that "capital [keeps] doing an ever-increasing portion of the total work" (p.71). Despite that, the authors "predict" that a broadening of capital acquisition will lead to "fuller employment of labor" and that "the present demand [...] [of] employment would increase" (p.71) (even by virtue of the market's anticipation of that broadening!), that it "should be reflected in increased employment of labor" (p.73).
That twist is unrealistic and makes no sense. Simply put, it would be absurd for a profit-maximizing agent to invest on labor even though (or despite that) he knows that labor keeps being increasingly replaced by capital.
The principle of decreasing marginal utility strikes the authors' presumption that higher levels of income will consistently lead to greater demand of goods and services. The authors purport that, unlike the "Keynesian analysis", binary growth would continue materializing in the long run. But they do not (and cannot) articulate how their proposal would overcome the decreasing marginal utility in the long run, or why this would be any different in the aggregate. In short, the authors appear to ignore the notion of oversupply.
The article posits that its so-called "binary economic approach" can also enhance "the prospects for achieving environmental sustainability" (p.70). But then it admits that it is optimistic and doubtful that "binary growth would in the aggregate be greener growth[,] because [...] too many people may also prefer to spend their enhanced capital income on brown rather than greener products and services" (p.73). The article ends up requiring an "active role" from the government "with respect to [...] environmental sustainability issues" (p.73).
The article also goes from the initial premise that its proposal would require "no government command" (p.70) to proposing that the government embrace an "active role" in defining where to promote a "qualified" binary financing" as well as to determine which producers shall be subjected to "more stringent [standards] than [the] mandatory standards imposed on all producers" (p.73). That governmental active role also includes the implementation of a "credit reinsurance entity modeled after the FHA home loan reinsurance program" (p.74).
The article is so poorly written and so incongruous that it significantly hurts the "prestige" and value of the authors' credentials (listed at the end: J.D. & Ph.D. holders). The only thing for which I would praise the article is the call for a reduction of tax rates. Putting aside the terrible "quality" of the article, it appears as if one team of authors wrote pages 70-71 and their opponents wrote pages 73-74.