Extending Democracy to Corporate Governance and Beyond : A Theory of Popular Economic Sovereignty

Worker democracy has long been a preferred policy in socialist thought, and has been championed in the context of capitalist systems as well. Arguments in its favor are often based on an analogy to the advantages of democracy in the political system. This article proposes a different rationale for corporate democracy based on an equivalence, not an analogy. The equivalence is that subordination feels essentially the same to an individual whether a public or a private entity carries it out. In the political system, democracy counteracts subordination by giving everyone political autonomy, an independent voice in controlling the power structure. By the same reasoning, those who work for a living should arguably control the institutions for which they work. Thus, the norms of democracy, when translated into the economic realm, yield the principle that people should not work for their livelihood on terms another person establishes. This can be called the principle of popular economic sovereignty. The idea can be put in operational terms by recognizing that our current conception of both the state and the corporation developed from medieval corporativist thinking. This same mode of thought generated the idea of representation that enabled individuals who were not leaders of a structured hierarchy to participate in state decisions, certainly one of the great insights of Western political thought. Representation became the mechanism by which democratic government was instituted. As democracy developed, the scope of representation expanded to include all competent adults. This same expanded concept of representation can be extended to employment relations and would serve the same purposes as it serves in the political arena – individual autonomy and an antidote to oppression. Corporations would be controlled by boards elected by the workers; small employers and individuals would be required to hire employees from labor exchanges run by the workers who are being provided. This proposal, although it sounds radical and impractical, could rather easily be implemented for both major corporations and all other employment relationships as well, and might well be more economically efficient than current modes of economic organization, as well as being more fair to the workers