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Thread: John Lewis partnership an Island of Socialism?

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    John Lewis partnership an Island of Socialism?

    Now here's a thought, if a firm operating on the lines of John Lewis opened in the US do you think that the rabid right wing would condemn it as a thin end of the wedge for the introduction of Socialism. It's a self contained retail outlet which shares profits with it's workers annually after putting aside funds for future development. This is a system which in it's own unique way is based on a socialist principle.

    Agreed the share out is based on the percentage of an individuals salary which means the board and managers get a bigger cut the shop floor workers, but it is not based in or dependant on the stock market and is not in effect a part of the capitalist system but a business Island operating within it.

    Supporters of super efficient capitalism who say the system can only work through ruthless efficiency with no room for mistakes, have been disproved by the highly successful John Lewis partnership, whose director has admitted that if the organisation had been operating within the normal cut and thrust of the capitalist system he and others on the board would have been sacked.

    He said "Mistakes have are regularly made and it doesn't operate at maximum efficiency", but here after all these years it's still going from strength to strength.

    This is an experiment started in the last century that is proof that ruthless maxim efficiency is not a necessary rule to success, and proves that a type of Socialism can exist successfully and thrive in one form or another.

    To answer to my own question, my guess is that if it became a success in the US the right would see this as a communist seed being planted on American soil and would stifle it by means of dirty tricks.

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    Re: John Lewis partnership an Island of Socialism?

    Profit sharing is common in the US. The company I worked for previously put over $90K in my 401K account, out of profits, over 10 years. It had a vesting scheme that saw me fully vested in 4 years. Granted, because it was a 401K (deferred taxation), any monies I withdraw before age 70.5 are taxed and penalized, but the point is that the company contributed the amount and it was not dependent on my own contribution to the fund as was independent of my salary and bonuses/commissions. It's not socialism, it's incentive and reward.

    I should also add that the funds are taxed when I start withdrawing them at the government mandated age, but they are not additionally penalized.

    Methinks you should find something else to take a swing at us about, as clearly you failed this time. The count is 0 & 1, 3 strikes and you're out

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    Re: John Lewis partnership an Island of Socialism?

    I went to John Lewis's in Milton Keynes in the early 1990s as I was looking to buy a Marantz stereo separates system.
    I was expecting to spend around 1000 including some excellent Wharfedale speakers.
    Me and Mrs spent quite some time in the shop and eventually decided to buy. I produced my credit card and they refused to take it!
    They said I could pay with a John Lewis credit card, which I had to apply for and come back in a few days, or I could pay with cash.

    I chose the 3rd option, which was to leave the store and buy elsewhere.
    I thought that this policy was rather elitist and when I saw your post, expounder, suggesting that they are socialist, I was somewhat surprised.
    I thought they were as capitalist as Margaret Thatcher. Oh well, I live and learn.
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    Re: John Lewis partnership an Island of Socialism?

    I've just had a quick look through John Lewis's 2009 annual accounts, and although the percentage of profits given to staff by way of bonuses is certainly higher than average, in all other respects they have a perfectly standard company structure and operation. I fail to see where the payment of bonuses to staff as an incentive to work harder and to retain loyalty qualifies as 'a type of socialism'; for that there would need to be co-operative ownership and management which there clearly isn't.
    Socialism in general has a record of failure so blatant only an intellectual could ignore it - Thomas Sowell

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    Re: John Lewis partnership an Island of Socialism?

    Quote Originally Posted by Midas View Post
    I've just had a quick look through John Lewis's 2009 annual accounts, and although the percentage of profits given to staff by way of bonuses is certainly higher than average, in all other respects they have a perfectly standard company structure and operation. I fail to see where the payment of bonuses to staff as an incentive to work harder and to retain loyalty qualifies as 'a type of socialism'; for that there would need to be co-operative ownership and management which there clearly isn't.
    You missed the point I was making Midas, had J.Lewis been a public company the director admitted he would have been sacked for inefficiency because of errors made. The points made by various people in previous posts is that inefficient societies can't survive.

    John Lewis proves [although in a miniscule way] that ruthless efficiency is not necessary in society in order to operate. It just depends on the degree of inefficiency. Capitalism demands ruthless efficiency for maximum profit the dog eat dog maxim. John Lewis proves a society operated on similar principles could survive given a reasonable degree of efficiency

    The socialist John Lewis comparison was a bit tongue in cheek.............................
    Advocates of capitalism believe : "The fortunate must not be restrained in the exercise of tyranny over the unfortunate"

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    Re: John Lewis partnership an Island of Socialism?

    Quote Originally Posted by Barry View Post
    I went to John Lewis's in Milton Keynes in the early 1990s as I was looking to buy a Marantz stereo separates system.
    I was expecting to spend around 1000 including some excellent Wharfedale speakers.
    Me and Mrs spent quite some time in the shop and eventually decided to buy. I produced my credit card and they refused to take it!
    They said I could pay with a John Lewis credit card, which I had to apply for and come back in a few days, or I could pay with cash.

    I chose the 3rd option, which was to leave the store and buy elsewhere.
    I thought that this policy was rather elitist and when I saw your post, expounder, suggesting that they are socialist, I was somewhat surprised.
    I thought they were as capitalist as Margaret Thatcher. Oh well, I live and learn.
    The point is Barry, what ever you may say John Lewis is a success in the middle of this crisis when other retail outlets going into liquidation and closing. They are preparing to open new department stores in the face of a severe down turn in consumer spending so I don't think they missed your purchase. I love to see an organisation like John Lewis sticking two fingers up to the rest of the stock market losers.
    Advocates of capitalism believe : "The fortunate must not be restrained in the exercise of tyranny over the unfortunate"

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    Re: John Lewis partnership an Island of Socialism?

    Quote Originally Posted by Expounder View Post
    The point is Barry, what ever you may say John Lewis is a success in the middle of this crisis when other retail outlets going into liquidation and closing. They are preparing to open new department stores in the face of a severe down turn in consumer spending so I don't think they missed your purchase. I love to see an organisation like John Lewis sticking two fingers up to the rest of the stock market losers.
    Got to agree there. Waitrose is part of the JLP and operates in exactly the same way. Both retailers have the best staff retention records in the UK market and also the lowest dismissal rate for any comparable sized employers in Europe.
    Left for a place without a childish and spite filled Moderator with a Hitler complex. A place of democracy and common sense where questions can be asked with a Mod getting their knickers in a twist because they lack confidence and are on a power trip.

    bet this gets edited. Take care all the decent people here. have fun.

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    Re: John Lewis partnership an Island of Socialism?

    Quote Originally Posted by Don View Post
    Profit sharing is common in the US. The company I worked for previously put over $90K in my 401K account, out of profits, over 10 years. It had a vesting scheme that saw me fully vested in 4 years. Granted, because it was a 401K (deferred taxation), any monies I withdraw before age 70.5 are taxed and penalized, but the point is that the company contributed the amount and it was not dependent on my own contribution to the fund as was independent of my salary and bonuses/commissions. It's not socialism, it's incentive and reward.

    I should also add that the funds are taxed when I start withdrawing them at the government mandated age, but they are not additionally penalized.

    Methinks you should find something else to take a swing at us about, as clearly you failed this time. The count is 0 & 1, 3 strikes and you're out
    Don, I do apologise for my ignorance of profit sharing companies in the States. My reference to Socialism in relation to our own John Lewis partnership was a knock at the right wing on the forum who think that any large company or society that is not run on free market lines and is not 100% efficient, must go to the wall.

    The John Lewis partnership is not a part of the mainstream free market retail outlets in Britain and the principle it is run on flies in the face arrogant free market capitalist ideology. Proving fair sharing can work.

    Out of interest what is the attitude of American public to profit sharing work schemes? I would imagine it's not widely encouraged.


    Regards Exp....................................................
    Last edited by Expounder; 12-03-2010 at 02:58 PM. Reason: addendum
    Advocates of capitalism believe : "The fortunate must not be restrained in the exercise of tyranny over the unfortunate"

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    Re: John Lewis partnership an Island of Socialism?

    Quote Originally Posted by Jim Franklin View Post
    Got to agree there. Waitrose is part of the JLP and operates in exactly the same way. Both retailers have the best staff retention records in the UK market and also the lowest dismissal rate for any comparable sized employers in Europe.

    Why can't a country be run along along the same lines?.
    Advocates of capitalism believe : "The fortunate must not be restrained in the exercise of tyranny over the unfortunate"

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    Re: John Lewis partnership an Island of Socialism?

    Quote Originally Posted by Expounder View Post
    Don, I do apologise for my ignorance of profit sharing companies in the States. My reference to Socialism in relation to our own John Lewis partnership was a knock at the right wing on the forum who think that any large company or society that is not run on free market lines and is not 100% efficient, must go to the wall.
    That's a bit of an assumption Expounder, I can't say that I or anyone else on the right wing has ever said, or even implied, quite that. Granted there are degrees of efficiency and the free market is the ultimate arbiter of who will remain in business and who doesn't; it's only right and proper that customers should get the best deal they can in terms of either price or quality or service - or a combination of all three - and those companies who can't or won't provide what customers want, must expect to lose them and ultimately their own business.

    Unlike under socialism where the failing are propped up by the successful to the ultimate detriment of all, free market capitalism focuses on providing the best rewards for those who take the most risks and who offer their customers a good deal along the way. John Lewis is a good example of this, and as Jim points out, has the best staff retention records in the UK market and also the lowest dismissal rate for any comparable sized employers in Europe. OK, their efficiency might not always be what it might could, but given it's a private company and they're making good profit margins and offering their customers what they want, I'm sure that even the most rabid right winger wouldn't have too many grounds for complaint.
    Socialism in general has a record of failure so blatant only an intellectual could ignore it - Thomas Sowell

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