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Bernie Sanders Takes Aim at Wealth—and Warren

His new corporate accountability plan heightens the contrast between his brand of socialism and his progressive rival's institutionalism.

Scott Eisen/Getty Images

Since his heart attack earlier this month, the press has begun loudly asking how long Senator Bernie Sanders can stay afloat in the Democratic primary and why, moreover, he should bother trying. After all, Senator Elizabeth Warren, the field’s other solid progressive, has taken the lead against Joe Biden in a number of national polls and has declared support for Sanders’s vision for Medicare for All, one of the central issues of his campaign. In an interview this weekend, ABC’s Jonathan Karl put the question to Sanders directly.

“What do you say,” he asked, “to those who would say they would pick her because she’s eight years younger than you, she didn’t just have a heart attack, and on the positions you’re pretty much the same?”

In response to Karl, though, Sanders made reference to a comment from Warren last year “I think she is a very, very good senator,” Sanders replied. “But there are differences between Elizabeth and myself. Elizabeth, I think, as you know, has said that she is a capitalist through her bones. I’m not.”

While Sanders, a self-described democratic socialist, has rarely contrasted himself with Warren this directly, his staunchest supporters have spent the past several months working to establish a clear ideological dichotomy between the two. It has not been easy. Behind the labels they have applied to themselves, Sanders and Warren have both spent the campaign promising to curb inequality and fight corruption, naming the greedy enemies of a fair economy on Wall Street and in Silicon Valley, and taking inspiration from the New Deal and Franklin Delano Roosevelt, hero of progressive capitalism.

Over the past few months, though, Sanders and Warren’s domestic policy agendas have diverged substantially on key issues. In late September, for instance, the Sanders campaign met Warren’s already ambitious proposal for a wealth tax on households worth at least $50 million with a more aggressive, multi-bracketed plan that could halve the wealth of American billionaires in 15 years. Both campaigns have also recently offered elaborate, but differing proposals on labor rights. But for all the substantive differences that have emerged, the Sanders and Warren policy visions have both been couched within the existing economic confines of capitalism, a system in which a particular non-laboring class owns and manages capital and is thereby empowered to make decisions in the economy, as opposed to workers, who would direct the economy under socialism.

That changed Monday morning, when the Sanders campaign released its “Corporate Accountability and Democracy” platform. The document includes a long slate of proposals that tread familiar ground on issues including anti-trust policy and corporate taxation. But its centerpiece is an idea that is not only radically new to this particular Democratic primary, but to contemporary American politics. Sanders has proposed having American corporations with $100 million or more in annual revenue and all publicly traded companies transfer at least 2 percent of their stock per year to their employees, until 20 percent of every such company is owned by workers. Those shares, which would grant workers corporate voting rights and entitle them to stock dividends, would be held in Democratic Employee Ownership Funds managed by trustees elected by workers.

According to the campaign, the proposal would apply to more than 22,000 companies employing 56 million workers, and the dividends paid out from the worker funds could be worth as much as $5,000 on average per worker, per year. This idea is accompanied in the platform by an ambitious set of related ideas. A plank inspired by corporate co-determination in Germany would require the same corporations to have workers elect 45 percent of their boards of directors. By comparison, Warren’s similarly inspired Accountable Capitalism Act, released last year, would require companies taking in at least $1 billion in revenue to have workers elect 40 percent of their boards. Sanders is also proposing giving workers the right of first refusal to buy companies put up for sale, and the establishment of “worker ownership centers” across the country that would help retiring owners of small and mid-sized businesses transfer their companies to their employees.

These are ideas aimed in part at addressing wealth inequality, a problem more vexing in many ways than the inequality in conventional income that often dominates progressive policy debates. The wealthy are wealthy not just because they take home bigger paychecks, but because they earn a wildly disproportionate share of the income generated by stock and other capital assets. Fully 97 percent of that income, Sanders’s platform notes, is owned by the richest 10 percent of Americans. Forcing the transfer of stock to workers would, of course, help close that gap.

Beyond fighting financial inequality, Sanders’s proposals are more radically aimed at putting workers near the center of economic decision making, in the hopes that their influence might align corporate priorities more closely with the interests of the working class. “The reality is that today the executives and biggest shareholders of most large, profitable corporations could not give a damn about the working class or the communities in which our corporations operate,” Sanders’s platform reads. “Employees in worker-owned companies are not simply cogs in a machine owned by someone else. They play a central role in determining what the company does and how it is run.”

Sanders’s corporate platform goes several steps past the familiar rhetoric of progressivism towards socialism proper. Instead of merely expanding the welfare state and regulating the market, Sanders is offering now an agenda that will introduce many to arguments for directly giving workers more control over our economy. Employee ownership schemes are not wholly new to the contemporary policy discourse. There are thousands of worker owned and managed firms in the United States and a modest, and particularly wonky model for ownership—employee stock-ownership retirement plans—has enjoyed bipartisan support in Washington for decades. But the forced, large scale transfer of stock to workers at major corporations resembles the economic vision of the Sanders-backing Democratic Socialists of America, who advocate for an economy in which workers directly control most firms, more closely than any policy idea advanced by a major politician in recent memory.

As radical as Sanders’s plan substantively is, survey data on worker ownership suggests that the public may well be receptive to proposals that go even further. A YouGov poll commissioned by worker-ownership advocacy group Democracy Collaborative earlier this year found that 55 percent of Americans would support requiring companies with at least 250 employees to eventually transfer as much as 50 percent of their stock to workers. The obvious caveat is that the public’s intuitions may change substantially as a debate over these proposals takes shape. But this debate is, in any case, long overdue. We now have real grounds for believing that progressives have a simple, but stark choice to make in this primary: Should we work towards saving capitalism once again, or should we move—finally and decisively—towards socialism?