“Why are we not giving incentives to companies to require them to give shares in their companies to all employees, at the same percentage of cash earnings as the CEO?” asked Mark Cuban, a successful entrepreneur himself, this week.
It was part of a conversation on X that covered artificial intelligence (AI), healthcare, wealth disparity and hopes for the future. A poster named “roon” kicked off the conversation Oct. 10 with the statement “not enough people are emotionally prepared for if it’s not a bubble,” apparently referring to AI.
Amid news about the U.S. labor market losing steam, concerns about AI replacing human positions is are on the rise. Audacy has reported on how AI is already impacting the labor market, including online retail giant Amazon’s announcement that it would likely cut positions in favor of AI development.
Commenting on roon’s post, writer Malcolm Harris said: “Okay, all customer service is AI now. Every company has a little more cash flow. Now what. Are they all going to expand output? Of course not, closer to no one would. Are they gonna pay workers more? No...”
That’s where Cuban – known as a minority owner of the Dallas Mavericks, founder of MicroSolutions and Broadcast.com, and as one of the sharks on the ABC reality TV Show “Shark Tank” – stepped in to the conversation.
“They are going to buy back more stock, admitting they don’t believe in their business enough to invest that money in their future,” he said. “Tax buybacks even more UNLESS they give stock to ALL employees at the same value to cash earnings as the CEO and all execs.”
Per Investopedia, a buyback refers to a company purchasing “its own outstanding stock shares to reduce their number on the open market.” According to Fortune, many companies already offer stock ownership or profit-sharing, but they cap what employees can get.
Cuban said he thinks “we should tax the s**t out of buybacks,” if they are not going to help all employees at the company buying them back. Earlier this year, Cuban also criticized some of President Donald Trump’s new economic policies, including tariffs and staff cuts through the Department of Government Efficiency.
Ge Bai, a professor of accounting at Johns Hopkins Carey Business School, joined the X conversation with another perspective: “Greed is good; otherwise, where is productivity? Billionaires use their $ to help others much more efficiently than the gov does.”
However, Cuban (who has an estimated net worth of $6 billion, according to Forbes) wasn’t buying it.
“Nah,” he said. “Once your LIQUID net worth becomes high enough, the true value to your life of your next dollar, by itself, gets smaller and smaller as your liquid net worth goes up. The value of those dollars become much greater, to you, and so many others, when you use your business, or other expertise to help others. That is the greater reward. Whatever got you to that level of liquidity most likely gives you a unique expertise, that can be put to work to help people who really need it now, or will need it in the future. And you might even make money from it. That’s ok. Compassion and capitalism, not greed, are what can make this country far greater.”
When it comes to practicing what he preaches, Cuban does have a history of sharing the wealth with his employees, according to CNBC. After he sold his first company, MicroSolutions, for $6 million to CompuServe in 1990, the took 20% of the sale price and paid it out to 80 employees at an estimated $15,000 per staffer. With the sale Broadcast.com to Yahoo for $5.7 billion in stock back in 1999, 300 of 330 employees at the company became millionaires. He’s also managed to keep his own billionaire status.
Another poster chimed in to note that billionaires have increased their own wealth by more than $33 trillion since 2015. Their figure is backed up by Oxfam research published this summer that found the “world’s richest 1% increased their wealth by more than $33.9 trillion.”
“This is more than enough to eliminate annual poverty 22 times over at the World Bank’s highest poverty line of $8.30 a day,” said the Oxfam report.
Cuban said that that billionaire wealth has gone up “because the stock market has gone straight up.” This comment from Cuban ended with that quote from the top of the article: “Why are we not giving incentives to companies to require them to give shares in their companies to all employees, at the same percentage of cash earnings as the CEO?”
So, how does Cuban think this could happen?
“What I would do is offer deductions for stock offered to employees making under 100k, if they are given at the same percent of cash earnings as the CEO or any other executive,” he explained. “You need to increase the amount of appreciable assets that people own in order to reduce income equality. When the market and values for private companies go up faster than wages, which is often, and always over the years, you want to maximize the number of people who can benefit.”