"Ask not what your country can do for you, ask what you can do for your country." ~John F. Kennedy (1961)
Introduction In the United States our Economy has been facing issues for years. Wages have been stagnant since the 1970's (35 years) and in some cases they have dropped. Check out the documentary Inequality For All where an expert describes the situation. Middle Class families of the United States of America adapted to these stagnant wages. First, mom went out to make money to make up for the increase in wages that dad did not see. Then both mom and dad worked as many hours as possible to maintain the "American Dream." Finally, to maintain their lifestyle people lucky enough to qualify for a mortgage for a home borrowed against it to maintain their lifestyle. The options, however, have run out. As minimum wage is raised so that the gap between minimum income and middle wage income becomes negligible more people will become unhappy with the state of the economy. If there is a 'beast' in this world it is certainly the Corporation where an employee is disposable, assigned only a number, and these 'legal entities' are not held by the Public to moral and ethical standards to which we would hold any other individual in this nation. In fact, we might even go so far to say that successful corporations, such as Apple, are worshiped. Further, in our current society it is the Corporation or Business that employs a person that is expected to punish an employee if they make controversial statements or display controversial ethical behavior outside of the workplace. First, and foremost, the fact that we have evolved into a society that pays entertainers- Sports Athletes and Hollywood Stars- an absurd amount of money compared to everyone else in society says something about our priorities. We value entertainment the most. However, we must remove this group of people when we are talking about economics because they are the exception to the rule. We need to take a look at ordinary people and a teacher, for example, should not compare their wage to that of an actor or actress because there are far more teachers then entertainers. Now, we need to look to the old traditional views of how to 'fix' this situation... Unions/Flat Equality For All The Documentary Inequality For All seems to suggest that Unions are the answer. I disagree. Today, Unions have been busted, their power to influence companies are minuscule. They are political advocacy group (Democrat) that negotiates for good medical benefits for their members and no more. The days of the Union are over. Even with Democrats in office they have little influence over the companies with whom they negotiate. Further, the answer to our economic problems does not lie in everyone having the same wage. As the failure of Socialism/Communism has indicated and the recent plight of Gravity Payments owner Dan Price realized...if everyone is paid the same income productivity will be stymied. The reason is that not all employees exert the same amount of effort at work so pay needs to be based on their productivity. Yet, this basic formula of Productivity = Income is currently ignored, for the most part, in business. The problem is, there are so many potential employees out there that will work for whatever wage a company sets that companies haven't faced a labor shortage. A few years ago there was a looming labor shortage. The baby boomers retiring should have resulted in a wage re-evaluation for every business...but it didn't happen. Why? The U.S. Government and companies solicited and then eased the process for educated immigrants from other countries (and uneducated immigrants for lower income jobs) to enter the U.S. to prevent the labor shortage. This short circuited what would have been a natural resetting of labor market wages as our country adjusted to a lower amount of citizens. The main motivation, perhaps, was to continue public assistance programs such as Social Security, Welfare and Food Stamps. The smaller generations could not support the retired baby boomers so immigrants were brought in to make up the difference...but there is another problem...not many people from the baby boomer generation retired leading to a surplus in labor. This surplus has actually pushed wages lower in fields such as long distance trucking. If the government can't force an equal pay grade across the board for certain jobs without killing productivity and Unions are ineffectual in this environment...what could possibly be the answer? Wall Street Occupy Wall Street was an extremely ignorant group. Although they were supposedly college students they were clearly not business students. The movement clearly did not understand how the stock market works or who owns stocks. Original entrepreneurs who start off as business owners tend to be the ones who own more stocks. The cycle starts when a successful small company decides they need money to grow their business. That's why companies go onto the stock market. The companies then take the capital that they are given by investors, reinvest it into their company and grow their business to the point where they can become global. Wall Street and the Stock Market serve the purpose of developing more money for start up companies to grow by making it easy for people to invest in the companies. The Stock Market does serve a very important role. However, the claims that those people with millions will start other companies is false. They usually do reinvest the money in other startups but that doesn't necessarily lead to more jobs. Few of them start second or third companies directly using their money. Therefore, the only benefit to not taxing them an appropriate amount is seen in Wall Street. The Stock Market is a self serving sector that is protected by our government and corporations alike. The Problem With Wall Street There is no denying that Wall Street is important. However, the problem is that companies never leave the Stock Market even when they reach the point where an established company cannot grow further or that "growing" profit is ridiculous. At this point the companies should go back to being private. This should be a default situation when a company cannot continue to make the hand over fist money that investors demand. The evidence is found when you hear that companies are buying other companies. This happens when a businesses has grown to the point where simply opening more locations throughout the globe does not bring in the profit to satisfy Stockholders. They can only grow their value by buying more 'capital' (land, other companies- physical property). When companies ignorantly stay Public after they have reached Market Saturation and no longer have options for growth the companies ship as much of their company's production over seas for cheaper labor. Corporations begin firing employees to continue to meet profit margins demanded by investors and assigning more responsibilities to the employees. They drop bonuses and, in extreme cases, dock wages in order to keep showing a significant profit over the last year. When, if they were private, they would be happily in the green zone of dependable profitability with no valid reason for justifying huge profit growth. At this point logic would suggest that these companies should leave Public Trading. There should be laws to ensure that they do this or at the very least a tradition in business. However, in earning my Masters in Business Administration there was no suggestion that a company should go back to being private or when that would be the most logical choice. Businesses, in academia and in practice, do not look at how unfeasible, illogical and downright morally corrupt it is to keep a business on the Stock Market after growth has been maximized. They, meaning the executives that make the decision, do not look at it logically as a temporary tool. The Constant Profit Problem Logically, if you follow the business model from Start Up, to going Public, to Expanding...there must be a time when a company reaches maximum profitability. The problem is, in academia and business circles, this apparently logical conclusion is not considered. Instead, companies have an idea that they need to push profit every year. They must see a percentage increase every year over the prior year in order to make their shareholders happy. Companies that have existed for decades or even a hundred years follow this concept. Private companies can also be this way but such companies are short lived because they cannot keep managers or employees. I've heard owners claim that they are Wolves devouring Sheep by using techniques to take as much money from people as possible. In big corporations this concept is even worse as the person can say that what they do, even if unethical, is for the benefit of the profit, and therefore existence, of their company and therefore justified. There is far less personal responsibility to decide that there is enough profit that wages for employees can be raised appropriately to compensate them for the companies success. Instead, the focus in publicly traded corporations, is to produce that profit for shareholders. In fact, increasing share holder profitability is almost always included in the Mission Statement of a Publicly Traded Corporation (in other words companies on the stock market). Demanding Morality From Corporations In the United States we have done the strangest thing. Corporations are their own legal entity. They are treated as a person, much as you or I would be treated, by the court. At this point, in academia and in practice (especially those on the Stock Market) Corporations are profit hungry beasts. Their matrix's and quarterly reports do not have a single line dedicated to the well being of the humans working within the company. Employee satisfaction is only evaluated to ensure that employees are as productive as possible to increase that profitability. Often times, these results are fabricated by individual managers that receive bonuses based on the 'satisfaction level' of their employees. I don't care if an individual is flesh and blood, an intelligent computer or a Corporation. However, as we demand morality from each other how much more important is it that we hold companies to ethical and moral standards? Those moral and ethical standards include a 'Living Wage'. We need to stop looking to government to raise the minimum wage which continues to decimate the middle class. Raising minimum wage doesn't cause companies to raise all of the wages, only their lowest earners, and causes those who are making a small amount above that to experience more economic problems. Unions tend to represent these minimum wage workers as well so they are not the answer here, either. The companies, morally, should provide a wage that is adjusted for inflation and cost of living. The wages should reflect the profitability of the company with the employee. The more profitable the company the higher the wages within that company should be compared to similar less successful companies in the same industry. However, in the realm of business, stagnating and reducing wages is considered good. Profit in other areas can be made if the employee is neglected and that profit is then given to majority shareholders to maintain the companies status on the Stock Market. Company's have a moral responsibility to their employees and that should be their priority- not satisfying majority Stock Holders indefinitely. We need to demand morality from the companies that we buy our products from. A company that will turn their backs on loyal employees to increase their profit margins should be punished- but not by the Government. We Are The Most Important Investors. Every time you buy a product you are investing in a company. Corporations make it clear the buyer is King or Queen. That is how you punish a company that lacks ethics and morality. You simply do not buy their product or frequent their stores. The Walmart Example I do not shop at Walmart. The reason I do not and will never frequent a Walmart store is because I researched the company for a college presentation. The way that they have negatively impacted smaller companies with their Price Setting caused me to decide their practices do not benefit the United States. Not only do they fail to pay their employees a good wage but they have a chain effect on the producers of the items they sell. Walmart is not just morally corrupt with their own employees but they effectively control the companies that provide their products. With, over four million products Walmart affects a large amount of companies. If we assume that each of those companies have only one hundred employees (a tiny amount) they negatively impact the wages of Four Hundred and Twenty Six Million Jobs. Let me say that again, Walmart effectively controls the wages of more then Four Hundred and Twenty Six Million Jobs by Price Setting that do not even work for them. Walmart alone employs 1.3 million people. What We Can Do People always wonder what they can do to fix a vast complex system. Realize that you help keep these 'corrupt' systems in place based on how you spend your money. Your buying power is what truly runs the economy. There are two areas that companies invest money in studying- how to attract buyers and increase employee productivity. If we buy items based on moral reasons or to push companies towards becoming private again in a bid to make them stop pushing for constant Herculean profit growth at the expense of their employees we can make them change. If their profit crashes, for whatever reason, they will move to meet the demands of buyers. Walmart Example Here is a basic example how this could be done. A group could be organized (like Occupy) where there is a formal reason given for choosing not to shop somewhere. Demanding that Walmart leave Public Trading and take the money were giving investors and raise All employees wages in the company by at least 20% except the Executives. We can also demand that they raise the amount they pay their suppliers so they can also raise their wages by 20%. Then we simply do not shop at Walmart for two weeks. We state that it's going to be a short amount of time because we do not want to destroy the company. We don't want to hurt the employees, we are just sending a message. If that doesn't work, then we extend it to a month. These brief times without profit will negatively impact their profit and failure to act will generate a lot of negative press. Their profitably will be negatively impacted long term if they do not respond in an acceptable way. In this way we can effectively raise the wage and standard of living for Four Hundred and Twenty Seven MILLION people. Think about it. Conclusion The problem with our economy isn't that people aren't spending money. The problem isn't 'Corporate Greed.' The problem lies in hungry beastly companies/corporations that are their own legal entities that are not held to moral or ethical standards by US- The United States Citizens. Luckily, that same hunger for profit is how we can change the system and demand that companies live up to their moral and ethical responsibility. By using the power of our spending money we send them organized messages demanding they change their ways. This doesn't involve violence. Only empty parking lots, and empty stores. The goal isn't to destroy the company but to encourage them to change their policies and practices. To force them to go private and focus more on being a profitable place for their employees to work and not large profits for shareholders. To change businesses or corporations we must speak their language. If you want to change how the Economy works and increase the wages for millions of people one simple act such as I described can send a strong message causing a cascade effect. We can't expect Government to do this, their place is in governing not setting business policy. We can't expect companies to change a system that seems to be working for them. We must behave in the way that will cause the change we want to see in the United States Economy. In the brave new world of a global economy, aside from a world government, the only people who can determine what Corporations or Businesses do is the average citizen thoughtfully picking and choosing where to spend their money. We need to peel back the gloss of sleek advertising and look at the actual operation of the companies from which we buy. I'd love to see the information on Glass Ceiling about work place environment translated to a website that gives a synopsis of how that company treats it's employees so that buyers understand the true nature of a company. Instead of just looking to save a dime, we should think about how our choice of how we spend that dime can impact millions of lives...including our own. Isn't it strange that we wouldn't think twice about giving that dime to a homeless person but we will do anything to 'save' it from a business? References Below is a trailer for Inequality for All. This documentary is currently on Netflix.
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Brave Soul! May Your Journey On The Path Of The Seeker Bring You Joy and Peace! I'm currently posting every Saturday. With a new addition the family I have pre-scheduled most posts through December 2022. Full Moon Posts will contain up-to-date content when I can get to them. Thank you so much for your support and understanding! This is a place where you can encounter new spiritual ideas that have helped me develop as an Individual On The Path of the Seeker. Take or Leave this information as you see fit. Archives
April 2024
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