Employee Ownership: Tocqueville’s Idea Whose Time may Have Come

Alexis de Tocqueville’s unfinished Second Memoir on Pauperism (2016) of 1837 is quite relevant today. As in the First Memoir on Pauperism (1997), Tocqueville’s focus was on poverty (or pauperism) and the debilitating effects of public relief (‘universal basic income’ in today’s terms). In the First Memoir, his concern was agriculture where he contrasted the virtues and efficiency of ownership in small farms as opposed to the large agricultural estates promoted by primogeniture, the agricultural aristocracy. Our topic is his turn to the problems of industry in his Second Memoir where he advocated finding a way of ‘giving the worker the small farmer's spirit and habits of property ownership.’ In the last quarter of the 20th century, that way was found with the development of the Employee Stock Ownership Plan (ESOP) mechanism. That mechanism has now been legislated and applied in the United States, the United Kingdom, Canada, and Slovenia, where workers establish ownership in their company paid for with future profits rather than out of their own salary or savings.