The latest Employee Ownership Blog post, Presidential Candidates and ESOPs, publishes a copy of a November 2, 2005 letter from Senator Barack Obama regarding a version of The ESOP Promotion and Improvement Act of 2007 (S. 1322):
Thank you for contacting me in support of S. 1319, the Employee Stock Ownership Plans Promotion and Improvement Act of 2005. ESOPs provide stability and security to many American families, so I am glad you wrote on this issue.
I appreciate the valuable role Employee Stock Ownership Plans play in the current economy. They provide incentives for employees to improve the performance of a company, which can contribute to our country's productivity. They are also an important path to economic opportunity for many families, and may be relied upon in times of economic need.
At the same time, concern is growing about the potential downside of ESOPs. If the value of an employee's company does not increase, the ESOP may be less beneficial than other types of plans. And, in extreme cases, if the company fails, the loss to employees could be significant. We have all witnessed disturbing episodes of corporations taking employees' hard-earned retirement savings down with them into bankruptcy, and we should be careful to encourage policies that discourage this unfortunate circumstance.
On the balance, I am confident that there is a place for ESOPs in the American economy. And I believe there should be further consideration of their role in public policies that encourage ownership and protect the income of hard-working families. S. 1319 has been referred in the Senate Finance Committee. I do not serve on this Committee, but I will keep your letter in mind should this legislation come before the full Senate.
Again, thank you for contacting me. Please stay in touch on this or any issue of concern.
Sincerely,
Barack Obama
United States Senator
More information about the bill and other current ESOP legislation can be found on the right-hand sidebar of this Blog.
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