This is a myth built on a myth: that a party can’t succeed without an awesome slogan and that the GOP’s 1994 Contract With America proves it. Both are false; the Contract wasn’t unveiled until just weeks before the election, and few voters had even heard of it. And remember the “unifying message” Republicans used to take the House in 2010, or the one Democrats used to take both houses in 2006? Of course you don’t.
There’s no mystery about what Democrats stand for — they want expanded health coverage, a higher minimum wage, higher taxes on the wealthy, stronger environmental protections, action on climate change and, yes, restraining President Trump and investigating the tsunami of corruption emanating from his administration — but the reason the criticism is so common is that they’re the party that actually cares about policy. They’re expected not only to have a lengthy agenda but also to be constantly coming up with new ideas.
So let’s take a moment to examine a new policy idea Democrats are proposing, one articulated in an op-ed in Wednesday’s Wall Street Journal by Sen. Elizabeth Warren. Noting that the corporation as a vehicle for organizing economic activity is a creation of government, she traces the change in corporate philosophy since the 1980s, after which “maximizing shareholder value” took precedence over every other goal, and suggests a new approach:
The Accountable Capitalism Act restores the idea that giant American corporations should look out for American interests. Corporations with more than $1 billion in annual revenue would be required to get a federal corporate charter. The new charter requires corporate directors to consider the interests of all major corporate stakeholders — not only shareholders — in company decisions. Shareholders could sue if they believed directors weren’t fulfilling those obligations.This approach follows the “benefit corporation” model, which gives businesses fiduciary responsibilities beyond their shareholders. Thirty-four states already authorize benefit corporations. And successful companies such as Patagonia and Kickstarter have embraced this role.My bill also would give workers a stronger voice in corporate decision-making at large companies. Employees would elect at least 40% of directors. At least 75% of directors and shareholders would need to approve before a corporation could make any political expenditures. To address self-serving financial incentives in corporate management, directors and officers would not be allowed to sell company shares within five years of receiving them—or within three years of a company stock buyback.
Warren’s bill is similar to a bill introduced by Sen. Tammy Baldwin (which Warren co-sponsored) called the Reward Work Act. That one would require that one-third of the seats on a corporation’s board be chosen by workers. While in America this is a radical idea, it’s built on the system in Germany, where it has been successful in both fostering economic growth and keeping corporations from focusing on the ruthless pursuit of short-term profits for a tiny few at the expense of everyone and everything else. (Susan Holmberg of the Roosevelt Institute explains here.)
This is a pretty terrific time to put this idea forward. Late last year, the Republicans gave hundreds of billions of dollars in tax cuts to corporations, with the promise that in their beneficence those corporations would raise workers’ standard of living. It didn’t happen; instead, the corporations put their money into an unprecedented wave of stock buybacks that enhanced the holdings of wealthy shareholders. Meanwhile, wages are stagnant and have been for decades. Something’s not working, and more tax cuts aren’t going to fix it. When a liberal group put the idea of including workers on corporate boards into a poll, it turned out to be enormously popular.
We’re in a situation right now where unemployment is incredibly low but many of the jobs people can find are low-wage and low-benefit. Inequality is increasingly defining the American economy, and the Republican answer to the problem is to give more tax cuts to rich people and corporations.
Republicans would recoil in horror at the idea of changing how corporations work, since their theory of the corporation is that it should have all the rights of an individual but none of the responsibilities. But this is a good example of Democrats coming up with an idea that’s ambitious, meant to address a deep and pressing problem, in line with their values, and compelling to voters.
Now if they can just come up with a jazzy slogan, maybe they’ll get some credit for it.