Author Charles D. Hayes writes:
A half century ago, General Motors was America’s largest employer and the hourly wages then, were equivalent to $50.00 per hour today. Now, America’s biggest employer, is Walmart and the value equivalence of their hourly wage is $8.00 per hour.
This is the reward of 50 years of trickledown economics and because this loss of equity happened so slowly over time, we have a frog in the pot scenario, in which, the frog (we) let the water get too hot, until jumping was not an option.
Moreover, the small-government-low-taxes mania that accompanies trickledown economics, combined with a governance that operates on the principle of legal bribery, is a recipe for oligarchy at best, and tyranny at the worst.
That the GOP still has wildly enthusiastic support for a system rigged so effectively that it amounts to Socialism for the top one percent, and that CEO’s and Boards of Directors openly loot our public corporations, without public outrage, is an assault on the very idea of democracy. Donald Trump currently has an 88 percent approval rating with Republicans. How in the name of hell is such imbecility possible?
Supreme Court Justice Louis Brandeis put our predicament in clear perspective: “We can have a democratic society, or we can have great concentrated wealth in the hands of a few. We cannot have both.”
French economist Thomas Piketty’s exhaustive research on the history of global capitalism, shows clearly and definitively that over time, unless there are very strict safeguards, capital will exponentially outpace the value of labor, resulting in an ever-increasing economic inequality.
This is where we are in 2019, and it’s going to take a lot more than a little tweaking with the minimum wage to fix this. We need a top to bottom makeover.
My reply:
There are two prominent fears to which we Americans are inclined to respond. One is economic fear, the other is emotional or physical fear.
After World War One, when the economy spun out of control only to collapse on Wall Street in 1929 with millions of Americans losing their jobs, homes and savings, while such places as Germany saw the German Mark not only become worthless but decidedly so with a trillion marks needed to buy a loaf of bread. This opened the door for the rise of Adolf Hitler and World War Two.
Something strange but seemingly predictable, given the two fears alluded to here, the American economy boomed immediately after World War Two with jobs aplenty and corporations not only vulnerable but open to laboring workers' demands. Then a funny thing happened.
Labor unions, which came out of WWII strong, instead of negotiating from strength, entered into collusion with Corporate America with workers giving up control of their work for pay and benefit concessions with the structures of labor unions proving to be essentially mirror images of their adversaries, Corporate America.
Peace existed in the trenches as long as the wealth creators profited against little or no international competition. It was like Christmas every day! I experienced a measure of this as I visited my professor uncle in Detroit several summers after WWII.
My uncle was Chairman of the Department of Economics & Commerce at the University of Detroit with Ph.D.’s in economics and psychology from the University of Iowa.
He lived at 20963 Northlawn Avenue in Detroit near the university off Livernois in a fine brick home with neighbor’s as doctors, lawyers, professors, and psychiatrists. Only a stone’s throw away, however, lived autoworker families in equally fine brick homes with late model automobiles in their driveways or garages.
Both parents likely worked in the automotive industry for Ford, Chrysler or General Motors, and their kids as well once they finished high school.
Both parents likely worked in the automotive industry for Ford, Chrysler or General Motors, and their kids as well once they finished high school.
The irony was that the professionals down the street were not as well off as these working class families who had invested nothing in education and therefore suffered none of the expense or experienced none of the delay in earning a good living as these college trained people did.
Yet, with mother and father, and often brother and sister working in the automotive industry, the family income sometimes proved staggering for the times. I know because I asked.
I knew some members of these working class families as I played baseball with them in a summer league. They didn’t care if their parents had mindless jobs on the assembling line. Indeed, they were looking forward to the same mindless jobs once they finished high school.
Families living high on the hog, didn’t save, and thought the honey trip would never end, until it did. As I mentioned in my previous missive, the world caught up with the United States, and no more tellingly so then with the automotive industry.
Back in 1953, Charles E. Wilson, CEO of General Motors said, “What was good for our country was good for General Motors, and vice versa.” He truly believed as Detroit went so did the rest of the country, or so he and others thought.
Detroit continued to make big gas guzzling cars while nations abroad were making and selling compacts to American consumers, and around the world. Meanwhile, Detroit’s automotive industry shrunk to embarrassing size, and with this shrinkage, tens of thousands of formerly well-paying jobs in allied industries disappeared as well.
“Sleeping in the nightmare” became part of the experience of automakers and their minions as the lack of strategic thinking and vision collapsed a stellar American industry.
Now, who do we blame this on, if blame is the game?
I knew some members of these working class families as I played baseball with them in a summer league. They didn’t care if their parents had mindless jobs on the assembling line. Indeed, they were looking forward to the same mindless jobs once they finished high school.
Families living high on the hog, didn’t save, and thought the honey trip would never end, until it did. As I mentioned in my previous missive, the world caught up with the United States, and no more tellingly so then with the automotive industry.
Back in 1953, Charles E. Wilson, CEO of General Motors said, “What was good for our country was good for General Motors, and vice versa.” He truly believed as Detroit went so did the rest of the country, or so he and others thought.
Detroit continued to make big gas guzzling cars while nations abroad were making and selling compacts to American consumers, and around the world. Meanwhile, Detroit’s automotive industry shrunk to embarrassing size, and with this shrinkage, tens of thousands of formerly well-paying jobs in allied industries disappeared as well.
“Sleeping in the nightmare” became part of the experience of automakers and their minions as the lack of strategic thinking and vision collapsed a stellar American industry.
Now, who do we blame this on, if blame is the game?
Do we blame it on the wealth creators who have made the United States the most vibrant economic power in man’s history? Or do we blame it on the shortsightedness of automotive and labor union management?
I have been a corporate executive with two Fortune 500 companies, a chemist with another, and have experienced the myopia of management on several fronts, including the international. I am sorry workers have suffered, but I have also seen little evidence of them, at any level, wanting to take care and control of their own destiny.
Workers gave up control of their work, and by extension, their lives, when they bought into the collusion of labor and management where wage and benefits concessions, including generous health insurance guarantees were part of the package.
I have been a corporate executive with two Fortune 500 companies, a chemist with another, and have experienced the myopia of management on several fronts, including the international. I am sorry workers have suffered, but I have also seen little evidence of them, at any level, wanting to take care and control of their own destiny.
Workers gave up control of their work, and by extension, their lives, when they bought into the collusion of labor and management where wage and benefits concessions, including generous health insurance guarantees were part of the package.
Many of these retirees still enjoy incredible benefits despite having worked many years ago, a burden that the automotive industry bought into when the gravy train looked as if it was overflowing with abundance, and would remain so forever.
On the other hand, I have known millionaires who have lost fortunes and worked their way back into creating others. Anyone who has ever been self-employed and have had other employees knows how hard it is to sometimes make payroll. I once own my own consulting company and I can tell you it is not easy; it is never easy.
Were it not for the Walmart’s and other such firms, where would the United States be today? People that work for such employers are often students, retirees, and people who lack the skills to be hired elsewhere. People who shop at Walmart’s benefit from the low prices which again benefit retirees and others on limited income.
Wealth creators are not the bad guys. Our spoiled brat society is a self-indulgent narcissistic society always looking for gain without pain, for a handout, or to get what it wants without using its brains or developing the emotional maturity demanded of a society clearly in decline.
Be safe,
Jim
On the other hand, I have known millionaires who have lost fortunes and worked their way back into creating others. Anyone who has ever been self-employed and have had other employees knows how hard it is to sometimes make payroll. I once own my own consulting company and I can tell you it is not easy; it is never easy.
Were it not for the Walmart’s and other such firms, where would the United States be today? People that work for such employers are often students, retirees, and people who lack the skills to be hired elsewhere. People who shop at Walmart’s benefit from the low prices which again benefit retirees and others on limited income.
Wealth creators are not the bad guys. Our spoiled brat society is a self-indulgent narcissistic society always looking for gain without pain, for a handout, or to get what it wants without using its brains or developing the emotional maturity demanded of a society clearly in decline.
Be safe,
Jim
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