To get the man’s soul and give nothing in return -– that is what really gladdens Satan’s heart.”
C. S. Lewis, The Screwtape Letters (1942)
CLASS WARFARE IS VERY REAL, QUITE BRUTAL—AND THE ULTRA RICH ARE WINNING HANDS DOWN—AND WRECKING AMERICA. The thought provoking blog, FABIUS MAXIMUS (written by several people including some friends of mine), has just come out with a disturbing piece on how the low pay squeeze works in practice—how the ultra rich are either exploiting those who work for them and/or actively degrading their earning power (a particularly worrying and prevalent practice).
In effect, capital is beating labor to a pulp because:
- A CORRUPT BUSINESS MODEL. The current American Business Model is largely bereft of any kind of moral code. This has nothing to do with religion. It has to do with right and wrong, of how we choose to treat each other, of decency. As matters stand—and it wasn’t always so—U.S. corporate culture is fixated on maximizing shareholder value because that optimizes CEO/Senior executive pay which is normally tied to share options (which are taxed at a lower rate). In short, CEOs have every incentive to boost their share prices—regardless of the costs to employees, suppliers, the community, the longer term welfare of the corporation itself (for instance, by cutting back on research and development), and the National Interest (corporate and U.S. interests are increasingly diverging). This is a structural problem of epic proportions—which is also deeply adversarial—with most employees being regarded as being disposable. In effect, they are treated—not as people—but as commodities. I suspect this kind of behavior is already having profoundly negative effects in terms of morale, productivity, and international competiveness—together with a growing disillusionment with the corporate workplace—but that management is compensating by squeezing even more and ignoring the evidence. Nonetheless, treating people badly sooner or later tends to rebound on you. Right now, given that power lies overwhelmingly with management, it looks like being later—but later may come sooner than we think.
- EMASCULATED UNIONS. Union power (the one force, other than legislation, which could keep corporations in check) has been largely broken (almost completely in the private sector) and it has been much hammered in the public sector too as a consequence of the extensive layoffs that took place during and after the Great Recession. This is not an accident. The Right Wing know perfectly well that if they want to represent the interests of the ultra rich—which is blatantly the case—unions have to be destroyed.
- UNCHECKED CORPORATIONS. Corporate power is largely unchecked, and corporations have learned to game the system—particularly by lobbying for endless tax breaks and other financial advantages which favor them. There was a time when corporations contributed about a third of the tax take. Now, they pay 10-12 percent—and many major corporations pay no tax at all. In addition, they have learned how to extract a truly vast amount of corporate welfare on a federal, state, and local level—even though they are no longer the job creation force that they were.
- BIASED LEGAL SYSTEM. The legal system—up to, and including, the Supreme Court—largely favors the ultra rich and the corporations they control. And to make the situation even more ridiculous, corporations gain enormously from the legal fiction that they are people. They are clearly nothing of the sort.
- NEAR NON EXISTENT WORKER RIGHTS. Worker rights are entirely inadequate—especially compared to Europe. This means that the individual is largely helpless when faced with corporate power.
- ULTRA RICH DOMINATE GOVERNMENT. The ultra rich and corporations either control all branches of government—or have enough power to keep it from being effective.
- ULTRA RICH AND THEIR CORPORATIONS OWN THE MEDIA. One of the reasons why the ultra rich have been able to rig the system to favor them so egregiously is that the media—who should be monitoring and deploring the actions of the ultra rich—are largely owned by corporations that the ultra rich control. And where there is coverage, it is neutralized with the argument that there are two sides to every issue, and that both should be given. On top of that, the number of journalists has been drastically reduced through wholesale layoffs, and investigative journalism largely eliminated. That means that the ultra rich can operate freely without fear of consequences—which is exactly what the do. This appalling situation is topped up think tanks and other institutions which spin the news to give the appearance of credibility to the plundering and distortion of the U.S. economy. This propaganda is highly effective and manifestly works. It also includes an endless stream of distraction which give the illusion of comprehensive news coverage—but not the substance. In effect, we are being manipulated at every level
- APATHETIC AMERICA. The American people—who have the latent power to change the situation—seem incapable of action, would appear to be in deep denial, and/or are frozen in fatalism. One could argue that they are largely ignorant because the the ultra rich have a lock on the media, but still I would have thought that enough information has got out to give a critical mass of the population an incentive to fight back. Apparently not. What is of particular concern is that all this has been going on since the early Seventies—for about 40 years—so the damage to American society is deep and may soon be fatal.
Well, the above list is mine. Now let me now quote from the FB summary (they start every piece with a summary which is an idea worth thinking about). The opening line is stunning—and accurate:
“One astonishing aspect of the structural changes reshaping America is how fiercely we work to avoid seeing them. Such as the transformation of employment. Breaking unions was the first and essential step. Now comes the larger changes: shifting jobs from full time with benefits and job security into temporary, insecure, part-time, no-benefits — at lower wages.
The FB piece continues by giving example of corporate exploitation covering:
- Entry level positions for lawyers
One could easily add:
- Regional airline pilots
- Adjunct professors.
- Journalists and writers in general
EGREGIOUS CORPORATE BEHAVIOR IS WIDESPREAD. In fact, the pattern is near universal and it adds up to the elimination of a fair wage—whenever possible—in favor of a relatively small number of senior corporate executives and their shareholders. As for the rest of us, we are being squeezed in every conceivable way to the point where not only are costs going up, but our earnings are in decline.
RIGGED SYSTEM. Right Wing propaganda tries to argue that the ultra rich deserve what they get because they have worked for it. In some cases, that is true—and few of us grudge those who make a genuine contribution being exceptionally well rewarded. However, even in those cases, the system is rigged to favor the wealthy in more ways than even someone like me—who has studied the U.S. economy for over a decade—can grasp adequately. It adds up to a systemic corruption of the democratic process—and has turned the constitution into a mechanism of wealth extraction from the many to the few.
HOW LONG CAN THIS CONTINUE. How long will this predatory situation continue?
Until Americans wake up and decide to act—or demand gets so depressed that the ultra rich decide treating their employees somewhat better might make financial sense.
It’s a thoroughly depressing situation which we ignore at our peril—yet we are ignoring it anyway.
FASCINATING BLOG: THE UNZE REVIEW –A Collection of Interesting, Important, and Controversial Perspectives Largely Excluded from the American Mainstream Media