Returning to the scene of the class war

Aggravated today by a New York Times story in which striking Verizon workers were forced to argue that their wages weren’t, in fact, “too high”–seeing them make the very valid point that living in the New York area and raising a family on $40,000-$70,000 a year doesn’t actually make them rich–I tweeted angrily:

“How the hell did we get into a world where workers making $60,000 are overpaid but CEOs making millions are overtaxed?”

I don’t tend to have that many Republican or libertarian Twitter followers, but when Kirsten Powers, a Fox News contributor, retweeted me, I was deluged with replies, some of which I’m reposting here (without user names, since I don’t know if these folks would care to share):

“becuase they are paying all those 60k wages. Without them, the people making 60k are unemployed.”

“Who assumes the most risk?”

“Pay is dependent upon what you accomplish for the company. If you make 60K and are not being productive..”

“If you have to threaten people with violence to earn $60K, you are overpaid.”

“because you can’t punish success. It’s anti-capitalist.”

“The workers making $60K accepted it while CEO’s demanded more, but how does the CEO’s wage negatively affect the $60K guy?”

So, some answers, shall we?

CEOs aren’t paying all those $60k wages out of their salaries. Their salaries are what they’re being paid by that same company that’s paying the workers. Running a small business is a different game: in that case, you make what’s left over. You do indeed “assume the risk”. I ran a small business for years–my parents still own it. Some years they took home $250,000. In 2009, they took home less than I did.

Verizon’s CEO assumes next to no risk. He gets paid whether the workers strike or not, whether they concede their benefits or not, and I’ll bet my next paycheck that he’s got a pretty sweet golden parachute set up even if he does get tossed out on his ass.

Taxpayers assumed the risk for Wall Street back in 2007-2008. Once again, those getting mega-rich had zero risk–we bailed them out. But while Wall Street tanked, the wealth of millions of everyday Americans was wiped out. Including, I might add, a lot of public pension funds for the very same public workers that right-wingers and these people on my Twitter feed seem to think are overpaid.

We’ve had 30 straight years of pretty much unabated tax cutting for the rich. And yet a random comment that perhaps the rich aren’t actually undertaxed on Twitter gets me lots of angry retorts–from a lot of people I’d bet aren’t rich themselves. The idea that “you can’t tax success” is ridiculous on its face: that’s what we do every single time we pay income taxes. We certainly didn’t manage to find a way to tax failure, or else Wall Street would be out of business.

Threatening to essentially tank the economy again if you are taxed is economic violence.

And the Verizon workers are demanding more. That’s why they’re striking. Actually, strike that–they’re not demanding more, they’re simply demanding not to give up the benefits that the company is contractually obligated to pay.

Now, the bigger idea behind this. The idea that somehow teachers, call center workers, janitors, secretaries, firefighters, and other so-called middle class workers are not “successful” or “productive”, and thus deserve to have their pay slashed, while millionaires are obviously making bank because they’re more “productive” than the rest of us. The idea that so many people seem to have accepted, that middle-class workers deserve to make less, even when we live in a capitalist economy predicated upon the idea that financial reward is the best and only incentive to do pretty much anything. The idea that only the ultra-rich do it for the money and need mega-compensation (and no taxes) while the rest of us work for the fun of it. The idea that workers daring to ask for a raise is slothful and wrong, while finance managers holding a gun to the head of the entire economy over a proposed regulation on their pay is just how business works.

We’ve basically internalized the fact that we’re a two-class society. “Job Creators” (the wonderfully mythic title assigned to the ultra-rich who are mostly sitting around on their asses waiting for the economy to magically get better so they don’t have to take any of that vaunted risk that capitalism is supposed to reward) and the rest of us.

Yves Smith wrote:

Businesses have had at least 25 to 30 years near complete certainty — certainty that they will pay lower and lower taxes, that they’ will face less and less regulation, that they can outsource to their hearts’ content (which when it does produce savings, comes at a loss of control, increased business system rigidity, and loss of critical know how). They have also been certain that unions will be weak to powerless, that states and municipalities will give them huge subsidies to relocate, that boards of directors will put top executives on the up escalator for more and more compensation because director pay benefits from this cozy collusion, that the financial markets will always look to short term earnings no matter how dodgy the accounting, that the accounting firms will provide plenty of cover, that the SEC will never investigate anything more serious than insider trading (Enron being the exception that proved the rule).

So this haranguing about certainty simply reveals how warped big commerce has become in the US. Top management of supposedly capitalist enterprises want a high degree of certainty in their own profits and pay. Rather than earn their returns the old fashioned way, by serving customers well, by innovating, by expanding into new markets, their ‘certainty’ amounts to being paid handsomely for doing things that carry no risk. But since risk and uncertainty are inherent to the human condition, what they instead have engaged in is a massive scheme of risk transfer, of increasing rewards to themselves to the long term detriment of their enterprises and ultimately society as a whole.

Because of course the mega-rich aren’t “job creators.” Job creators are all of us. We pay taxes and employ federal workers. We buy things, and keep the rich in business. The fact that there aren’t enough jobs right now? It’s not because the rich ain’t rich enough. It’s because the rest of us don’t have enough money, after decades of wages being pushed downward or jobs being outsourced, squeezed, made “flexible” and just plain eliminated. We’re not spending, we’re not buying, and we’re not creating jobs because we don’t have enough money.

It’s a vicious cycle and it’s one that doesn’t look to be stopping anytime soon. The immensely popular solution, according to poll numbers, would be to tax millionaires and use that money to invest in infrastructure–creating jobs, putting money into the pockets of the broke. Even some millionaires are asking to be taxed–Warren Buffett in the pages of the New York Times.

Henry Ford was a union-busting, Nazi-sympathizing jerk, but he understood that to be successful people had to make enough money to buy his product–automobiles. The economy we have right now is the direct result of people no longer understanding that basic concept.

And thus we have people shouting me down on Twitter about cutting the wages and benefits of middle-class workers, while defending the right of the ultra-rich to keep their money. It’s class war, as Warren Buffett himself has said many times, and the best weapon the upper class has is that the rest of us continue to defend them, whether out of some mistaken idea that we’ll someday be like them, or out of a Ralph Nader-style hope that the “super rich will save us” by suddenly coming down from their mountain and hiring people (to do what, exactly?), or out of anger that union workers somewhere might be making more than you and thus a need to cut them down to size.

But maybe that last Twitter commenter is on to something when he says that the $60K employee accepted it and the rich demanded more. Maybe it’s time for all of us to start demanding more.


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54 Responses to Returning to the scene of the class war

  1. PrettyAmiable says:

    As a note, when people say those high-paying folks are the ones that create jobs for people who are making less in hourly jobs, I think they mean that they’re strategic folks who make decisions about expansion.

    The flip-side people seem to forget is that those same strategic folks are the ones who decide when to kill jobs.

  2. little sister says:

    Well said, loved reading this.

  3. BMICHAEL says:

    I almost can’t believe what people seem to accept from life, from, you know, our corporate overlords. We have all the information, and still it’s all pretty crappy.

  4. petpluto says:

    I work with someone who routinely argues that we can’t possibly raise taxes on the rich, because that’s supposed to mean families who make $250,000, and that’s barely enough to live on in New York City and the surrounding area! but then in practically the same breath argues that people should never join unions and that the Verizon workers are thugs who think they’re special.

    Granted, her husband works at Verizon in management and has apparently be threatened; but I can’t quite figure out how people making $250,000 are “poor” and can’t possibly be taxed more and actually live, but people making less than that and fighting to keep it are unworthy and should have their benefits stripped away from them because the rest of us don’t have those same sweet deals. It almost makes me want to ask her if she’ll drop her salary down to what I make.

  5. Athenia says:

    Thank you for this article and I think I love you.

  6. Athenia says:

    petpluto:
    I work with someone who routinely argues that we can’t possibly raise taxes on the rich, because that’s supposed to mean families who make $250,000, and that’s barely enough to live on in New York City and the surrounding area! but then in practically the same breath argues that people should never join unions and that the Verizon workers are thugs who think they’re special.

    Granted, her husband works at Verizon in management and has apparently be threatened; but I can’t quite figure out how people making $250,000 are “poor” and can’t possibly be taxed more and actually live, but people making less than that and fighting to keep it are unworthy and should have their benefits stripped away from them because the rest of us don’t have those same sweet deals. It almost makes me want to ask her if she’ll drop her salary down to what I make.

    Because she probably has a house, a huge mortage, lovely property taxes which are the highest in the nation, 3 kids in college–and she doesn’t get any financial aid cuz they make too much. Oh, and she probably has a cottage that she has to pay for as well. So, she could be very well be living pay check to pay check.

    So yeah, she’s totally missing the whole principle of living under your means.

  7. Sheelzebub says:

    I used to make what these guys make at their upper end; I now make much less. I agree that they are quite reasonable in their assertion that $40K-$70K is not enough to raise a family on in NYC and godsdammit, they have every right to strike for more. There is nothing wrong with getting paid a fair wage, and frankly, if it’s too expensive for Verizon to pay their workers a living wage, maybe the CEO should reconsider his $2.1M salary or $3.9M bonus this year. FFS.

  8. maja says:

    Workers of the world unite!

  9. Bitter Scribe says:

    $60K is what I make now. It used to be upwards of $70K, until my company was bought by Parent From Hell Ltd. (PFH), which was headed by a trio of idiot brothers, all grandsons of PFH’s founder. They borrowed a lot of money to overpay for our company, then promptly imposed a 25% pay cut–that’s twenty-five, not two point five–so they could keep up their loan payments.

    At a companywide meeting to explain the pay cut, one of the idiot brothers told a rambling story about how his grandfather, before founding PFH, had been a bomber pilot in World War II. One day they got in a firefight with a Jap and downed him, but sustained a hit to the gas tank and began losing fuel. They had to throw one thing after another out of the plane to lighten it so they could make it back to base. Idiot grandson was using this as a metaphor for our situation.

    But as I sat listening, all I could think was, “Why couldn’t that fucking Jap have been a better shot?”

    (I finally got free of PFH, but it took more than two years.)

  10. Bitter Scribe says:

    BTW, Sarah, I forgot to say this above, but fabulous post.

  11. arcadesproject says:

    Super post. Just super. Listening to middle class people trash other middle class people for making, or aspiring to make, too much money, is a mind blowing experience that I have almost every day. If only these folks could find their way to the Progressive blogosphere. Maybe a trail of crumbs?

  12. Opheelia says:

    This post is brilliant. America labors under the impression that everyone has exactly what they “deserve,” from educational opportunities to salary to status as a rape survivor. Rich people deserve to be rich because they worked for it (even if they were born that way). Poor people deserve to be poor because they didn’t work to rise above it (regardless of the environment, community, or school district into which they were born).

    And this continues to enlighten:
    http://motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph

    Another facet of this problem is that people (mostly people on the right) think that people who work in the public sector aren’t part of the economy. My governor said that “no government ever created a dollar of wealth.” Really? My salary, like those of teachers as well as, you know, my governor, is funded by state and federal grants. I pay rent, I buy groceries, I buy gas, I pay for utilities, but somehow my money is Communist red instead of the green money that people in the private sector make. 97% of my paycheck is pumped immediately and DIRECTLY back into the economy. How many people making over $1M can say that?

    If the government decided to phase out state and federal grants for social services in favor of relying on donations from the private sector, how would they get people to donate? TAX DEDUCTIONS. It’s a fucking wash.

  13. Lasciel says:

    Aren’t the strikes taking place in a bunch of states? Obviously $60,000 isn’t much if you’re in NY, but I can see where people from lower-living-cost areas are boggling at someone striking over such pay. That’s about 3 times what a teacher makes here :/ Combine that with the high unemployment rates and all the people that would love to score a job with Verizon for themselves of a family member, and I’m not surprised sympathy is low at this time.

  14. Shoshie says:

    Opheelia: My governor said that “no government ever created a dollar of wealth.”

    That’s also bullshit because government pays for scientific research which, at least in theory, contributes towards furthering technology, which means startups and so forth.

    I just had to sit through a super boring lecture about “innovation,” which evidently doesn’t mean what the boring-old-dictionary says it does, but ACTUALLY means translating scientific research to $$$. Who knew?

  15. K__ says:

    In the last couple of years, I decided that when people use the line, “We pay executives at large, multinational corporations so much because they’re taking on high risks,” what they mean isn’t risk of the business going under. It’s not compensation for a high risk-to-reward ratio.

    I decided it’s that the executives & high paid, high profile business persons are getting paid a bundle in exchange for being the scapegoat if/when the company is caught engaged in some cheating, destructive behavior. If it’s a bad enough offense the whole company could go belly-up and take most of the employees with it (Arthur Anderson/Enron) but management is likely to be held accountable for signing off on shitty decisions.
    That’s the risk they get paid so much to take on. The risk of accountability – a very, very minor, very slight risk; most of the time you get away with it but juuuuust in case…

    Except for the part where that doesn’t happen – management at big companies have made some godawful decisions & choices in the last couple of years, but in the long-term I keep seeing them get away with it. So much for accountability.

  16. wembley says:

    Love this post. Spot-on.

  17. tinfoil hattie says:

    I dunno, Lasciel (@13). Where in the U.S. are these places where life is so cheap? Because as far as I know, gas is high everywhere, food is high everywhere, utilities are high everywhere, etc. Housing is probably the biggest variable.

    Guess what the largest portion of my take-home income goes to? Medical care. Yup, premiums and deductibles and co-pays for a family of four whose members don’t get sick that often and don’t have chronic health problems.

    But as a small business owner, I haven’t increased my wages in about 6 years. Because I want to pay my two employees a decent salary. Without them, I can’t be in business. That’s something the overpaid, overprivileged executives don’t seem to internalize.

    I concur with BMICHAEL @3, who said: I almost can’t believe what people seem to accept from life, from, you know, our corporate overlords. We have all the information, and still it’s all pretty crappy.

    The $20k or so teachers make where you live is a crime, not an excuse to cut Verizon workers’ pay and benefits.

  18. Sarah says:

    Lasciel:
    Aren’t the strikes taking place in a bunch of states? Obviously $60,000 isn’t much if you’re in NY, but I can see where people from lower-living-cost areas are boggling at someone striking over such pay. That’s about 3 times what a teacher makes here :/Combine that with the high unemployment rates and all the people that would love to score a job with Verizon for themselves of a family member, and I’m not surprised sympathy is low at this time.

    That’s sort of my point: the anger shouldn’t be at the workers who make a decent middle-class income, the anger should be A. that teachers are paid so little (which state are you in?) and B. that the Verizon CEO makes about $55,000 A DAY.

  19. Florence says:

    tinfoil hattie: I dunno, Lasciel (@13). Where in the U.S. are these places where life is so cheap? Because as far as I know, gas is high everywhere, food is high everywhere, utilities are high everywhere, etc. Housing is probably the biggest variable.

    Guess what the largest portion of my take-home income goes to? Medical care….

    The $20k or so teachers make where you live is a crime, not an excuse to cut Verizon workers’ pay and benefits.

    Yes and yes on both points.

    Where I live, $60,000 would make a great salary. It would be just enough to raise a small family, maybe (maybe!) buy a house and pursue things like higher education and an annual vacation. That all-American dream people talk about. The problem is that securing a job that pays even that much is a serious coup. I’m currently supporting a family of four on only my $40,000 income before tax and healthcare costs are subtracted, and that means absolutely no extras other than internet access and cable TV.

    Also, teachers’ beginning salaries in this area are under $30K. Paying teachers so little is damn near criminal.

    Sarah: That’s sort of my point: the anger shouldn’t be at the workers who make a decent middle-class income, the anger should be A. that teachers are paid so little (which state are you in?) and B. that the Verizon CEO makes about $55,000 A DAY.

    *COUGH* This bears repeating over and over and over again.

  20. Like I just said on Pandagon, if the workers for a company aren’t producers, then what’s a strike to these people? Why are they upset that people they claim produced nothing now say they won’t produce? That’s sort of like me pitching a fit because I don’t get a magazine in the mail I didn’t subscribe to.

    They can’t have it both ways: Either workers produce nothing of value, or strikes are a real problem because they stop production. But accusing workers of not producing, and then pitching a fit when they actually don’t produce makes no kind of sense at all.

  21. Doc G says:

    It’s important to note that Henry Ford wasn’t necessarily a better or smarter person than today’s CEOs: at that time, Sarah points out, an industrialist needed his workers to be able to afford the stuff they make. Does big commerce in the USA actually make anything for middle class workers to buy? I think our economy has evolved to a point where the middle class is actually just not important to the wealthy any more. They have no business incentives to keep us around, so we need to impose legal ones.

    What I think people don’t understand about corporations is that they exist to make money, and any person who’s not completely dedicated to the goal of making more and more money is going to lose their job. So BY THEIR NATURE corporations are going to try to influence politics and policy as much as possible, which is why we need to keep a hard lock on the rules of what you are and aren’t allowed to do in pursuit of those profits. A majority of people agree that we need to both change the current rules and raise taxes on the mega rich (only ideologically blind middle class people continue to insist on protecting the mega rich, in a sort of class based Stockholm syndrome) and it’s just our paralyzed and broken government that has proved over and over again that it’s not capable of acting in the best interests of the people.

    NI4D.org anybody? Just throwing it out there.

  22. Doc G: Verizon is a good example of how they very much need a middle class. If everyone that wasn’t rich had their wages suppressed to the point that these fuckers want, there wouldn’t be people to buy Verizon’s products. Verizon’s profits from smartphones and cable lines would dry up, as those are the first items to go when you’re trying to find money to pay for something to eat.

  23. Brandy says:

    This is excellent. Thank you.

  24. LC says:

    Verizon is currently still targeted at the middle class, as are the cable companies, but that’s all dwindling.

    As Advertising Age itself points out, there’s very little point in targeting anyone below 200,000 a year ($100,000 a year if they are under 30), because no one else has any money, and they won’t have money in the future.

  25. Waingro says:

    At least the Pinkertons were paid for their efforts to destroy the labor movement. These tools are willing to volunteer.

  26. Dawn says:

    One of the problems is I think that rich folks have forgotten that if the country sinks, so do they.

    For the last thirty years, people of every class have acted like the world is a gravy train that will continue to pay out without needing input, and now many of them are finding out that it’s the end of the line and time to restructure, of course they don’t like it, because restructure is effort.

  27. La Lubu says:

    Lasciel, as a person who lives in flyover country, I have heard the “but the cost of living is so low where you live” my entire life. And it has been wrong for that amount of time, too. You know what’s cheap here? Housing. That’s it, housing. And by “housing”, I mean single-family, owner-occupied housing—not rentals. Rentals here are twice the price (or more) of a comparable mortgage. Why? Because of over thirty years of economic policies that eviscerated the “middle class” (meaning, middle-income earners). Those policies destroyed the Rust Belt, where the economy was literally built on the backs of union workers in and surrounding the manufacturing base. Those jobs were NOT replaced with similar paying tech or service jobs; they were either not replaced at all, or replaced by far-lower pay, no-benefit jobs that leave people struggling and with no disposable income.

    The jobs left, so houses are cheap. Rent is cheaper than it is on the coasts, but comparable to what people are paid around here (especially the difficulty of finding *full-time* employment), it isn’t.

    In central Illinois, our electricity isn’t cheaper. Our natural gas isn’t cheaper. Our medical care sure the fuck is not cheaper. Our gasoline is not cheaper, nor is the price of our vehicles and maintenance—and for those of us whose only form of income is employment, going carless isn’t an option as we have inadequate or *no* public transportation to replace it. Our clothing and shoes aren’t cheaper. School supplies aren’t cheaper. Corrective lenses aren’t cheaper. Telephone service isn’t cheaper. Food is not cheaper (especially at farmer’s markets. Our local farmer’s markets charge two to three times the *literal, not just comparative-to-income price of farmer’s markets in major metropolitan areas like NYC, judging from what I read in foodie blogs). Tuition isn’t any cheaper out here. Most forms of entertainment are not cheaper out here.

    Just like it’s expensive to be poor, it’s expensive to live in a geographic area with a declining or depleted economy. More costs are outsourced to the individual, which means even more of that supposedly too-high 60 grand yearly income is necessary. Sonofabitch, you think we don’t want to send our kids to college? You think we don’t want to still have a home when we’re too old or infirm to work? How the fuck do you suppose we’re gonna do that with no already-spoken-for income?

  28. We seem to be returning to an earlier economic system. There are those at the top who have everything and those at the bottom who have increasingly less. One of the reasons the South is economically backwards is that its entire framework was set up with such a massive gap between the planter elite and the poor farmer.

    I would hate to think that years of industrialization, stratification, and solidarity would be cast aside in other parts of the country.

  29. Nutella says:

    Doc G

    What I think people don’t understand about corporations is that they exist to make money, and any person who’s not completely dedicated to the goal of making more and more money is going to lose their job.

    True in principle, not true at all in practice. A corporation that wanted to maximize profits for shareholders would NOT pay the CEO $millions + golden parachute. In practice, a corporation’s first and most important goal is overpaying their boards and CEOs. They try to keep enough money coming in and expenses and salaries for everyone else down just to maintain their own bloated salaries.

  30. Lasciel says:

    La Lubu:
    Lasciel, as a person who lives in flyover country, I have heard the “but the cost of living is so low where you live” my entire life. And it has been wrong for that amount of time, too. You know what’s cheap here? Housing. That’s it, housing. And by “housing”, I mean single-family, owner-occupied housing—not rentals. Rentals here are twice the price (or more) of a comparable mortgage. Why? Because of over thirty years of economic policies that eviscerated the “middle class” (meaning, middle-income earners). Those policies destroyed the Rust Belt, where the economy was literally built on the backs of union workers in and surrounding the manufacturing base. Those jobs were NOT replaced with similar paying tech or service jobs; they were either not replaced at all, or replaced by far-lower pay, no-benefit jobs that leave people struggling and with no disposable income.

    The jobs left, so houses are cheap. Rent is cheaper than it is on the coasts, but comparable to what people are paid around here (especially the difficulty of finding *full-time* employment), it isn’t.

    In central Illinois, our electricity isn’t cheaper. Our natural gas isn’t cheaper. Our medical care sure the fuck is not cheaper. Our gasoline is not cheaper, nor is the price of our vehicles and maintenance—and for those of us whose only form of income is employment, going carless isn’t an option as we have inadequate or *no* public transportation to replace it. Our clothing and shoes aren’t cheaper. School supplies aren’t cheaper. Corrective lenses aren’t cheaper. Telephone service isn’t cheaper. Food is not cheaper (especially at farmer’s markets. Our local farmer’s markets charge two to three times the *literal, not just comparative-to-income price of farmer’s markets in major metropolitan areas like NYC, judging from what I read in foodie blogs). Tuition isn’t any cheaper out here. Most forms of entertainment are not cheaper out here.

    Just like it’s expensive to be poor, it’s expensive to live in a geographic area with a declining or depleted economy. More costs are outsourced to the individual, which means even more of that supposedly too-high 60 grand yearly income is necessary.

    I didn’t make my comment to excuse people hating on the strikers, or to somehow condemn the strikers. My point is as you say: cost of living is not reflected in salaries. Many salaries just don’t make the math: you can literally not afford to live and support a family on them in many areas. And this is not just people that work for the (obviously) evil corporations, this also applies to teachers, social workers, etc and people employed by small businesses or owning them.

    Illinois is a ridiculously expensive place to live when compared to neighboring states. Gas prices, food, etc? When we lived in Illinois we drove over to Missouri and stocked up on gas, food, (and cigarettes, those were cheaper too :) When you have a 30+ cent differences in the cost of a gallon of gas, that takes its toll on people. But is that reflected in Missouri/Illinois salaries, excluding perhaps, Chicago and some other areas? Nope, IMHO. Min. wage is a bit higher in Illinois, but I haven’t seen any difference really in salaries. Except that there’s less jobs to be found in Illinois.

    Bah, this sounds like I’m saying everyone should be striking :) Which isn’t wrong…

    We know we could pay everyone better and create more jobs…. if we cut defense spending significantly and taxed the rich higher. We elected a president who was supposed to do these things. Yet we’re still waging war, as the article points out, even though people don’t want it, and it takes money that could be spent at home. The Bush tax-cuts have been kept in place, even though most people didn’t want them.

    Our government won’t listen to us. It won’t. It doesn’t matter who we elect: Obama, a Republican, a different Democrat-they are almost all corrupted by corporate influence. And they will never raise taxes on themselves or the wealthy and influential who support them. It’s a joke.

    We all outta go on a fucking strike.

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  32. Sarah, wild applause for this post, and La Lubu, wild applause for your totally amazing and logical and straightforward debunking of “but the cost of living is so much cheaper!” arguments.

  33. Rare Vos says:

    I wonder how long my verizon wireless contract is. I definitely will not be renewing it unless the management miraculous become decent human beings.

    I won’t hold my breath.

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  35. jjuliaava says:

    tinfoil hattie:
    Where in the U.S. are these places where life is so cheap?Because as far as I know, gas is high everywhere, food is high everywhere, utilities are high everywhere, etc.Housing is probably the biggest variable.

    The $20k or so teachers make where you live is a crime, not an excuse to cut Verizon workers’ pay and benefits.

    St. Louis, MO

  36. jjuliaava says:

    I am pro-post, but I have a question about this:
    “…or out of a Ralph Nader-style hope that the “super rich will save us” by suddenly coming down from their mountain and hiring people (to do what, exactly?)…”

    In defense of Mr. Nader, he is a consumer advocate, not someone who believes the “super rich will save us”– in fact that is the exact opposite of what he stands for. Lordy, we should have listened to and voted for Ralph Nader over a decade ago when he ran on a campaign of creating green jobs. What would our economy be now if he had won the election? Hmmm?

  37. Sarah says:

    jjuliaava:
    I am pro-post, but I have a question about this:
    “…or out of a Ralph Nader-style hope that the “super rich will save us” by suddenly coming down from their mountain and hiring people (to do what, exactly?)…”

    In defense of Mr. Nader, he is a consumer advocate, not someone who believes the “super rich will save us”– in fact that is the exact opposite of what he stands for. Lordy, we should have listened to and voted for Ralph Nader over a decade ago when he ran on a campaign of creating green jobs. What would our economy be now if he had won the election? Hmmm?

    Ralph Nader wrote a book called “Only The Super-Rich Can Save Us!” I’m very aware of who he is and voted for him in 2000.

  38. guy leonard says:

    Pay is not about risk it is mostly about responsibility. Lose 1 out of 70,000 customer service reps and nobody notices. Lose 1 out of 1 CEO and the company has trouble.

  39. Ravan Asteris says:

    But maybe that last Twitter commenter is on to something when he says that the $60K employee accepted it and the rich demanded more. Maybe it’s time for all of us to start demanding more.

    Isn’t that what the Verizon employees are doing? They are demanding more by striking! So no, they are not “accepting it”, they are demanding more. That’s what unions and collective bargaining are all about – demanding more, just like CEOs and banksters do via lobbyists.

  40. Bob says:

    Sheelzebub:
    I used to make what these guys make at their upper end; I now make much less.I agree that they are quite reasonable in their assertion that $40K-$70K is not enough to raise a family on in NYC and godsdammit, they have every right to strike for more.There is nothing wrong with getting paid a fair wage, and frankly, if it’s too expensive for Verizon to pay their workers a living wage, maybe the CEO should reconsider his $2.1M salary or $3.9M bonus this year.FFS.

    Well, if you go according to the “too big to fail company norm”, he is “underpaid”. Most of those “big company” CEOs make $10M or more and that doesn’t include those huge bonuses they give themselves for decreases in profits (or increases – either way).

  41. Left_Wing_Fox says:

    guy leonard:
    Pay is not about risk it is mostly about responsibility.Lose 1 out of 70,000 customer service reps and nobody notices.Lose 1 out of 1 CEO and the company has trouble.

    Lose 1000 employees, and the CEO gets a bonus. CEO loses half the company’s marketshare? Well, 10,000 employees are now expendable.

    That’s not responsibility, that’s control. And what it really comes down to is the CEO controls the company, and often has enough support from the board of directors to have control over them too. We need a corporate Magna Carta.

  42. Stentor says:

    A few thoughts that bear repeating over and over to the general public, and Republicans especially. These things need to be beaten over their heads like clubs until they begin to see the light and stop voting against their own economic interests.
    First, it’s fucking amazing that the party of so-called “Family Values” doesn’t want to pay anyone enough of a living wage that you can have single-earner families.
    Secondly, the pendulum has been swinging towards share-holders or the investor class, and away from employees, or the labor class for the past thirty years, ever since Reagan shifted the tax burden to the middle-class by squashing the tax code, and engaging in huge amounts of deficit spending, and exacerbated by the rise of the Financial, Insurance, Real Estate (FIRE) or its current name the Financial Services Sector. This has to stop, they have hijacked government and distorted the normal functioning of government towards their narrow class, leading to the rise of a new feudal nation. Democracy as we know it will come to an end if we fail to stop and/or reverse the swing of that pendulum. This is what predicated the rush towards higher profits, this is what predicated the move of operations overseas, this is what predicated the housing, oil, and stock market bubbles. The pendulum needs to swing back towards the labor class, and needs to do it for a long time to equalize the unequal nature of wage scales in this country.
    Thirdly, as an engineer and someone fluent in math, if you want to break down hourly wages and yearly salaries into each other, if someone is only paid $20 thousand a year, they are only making $9.50 an hour, if someone is being paid $30 thousand they are only making 14.50 an hour. If someone like a CEO is being paid $55 thousand a day, they are making $6,875.00 an hour which is 724 times the first wage and 474 times the second wage. Nobody, I don’t care who they are, deserves to be paid that much, and should be regulated, because it has obviously grown out of control.
    One of the main purposes of government is to restrict business, because they have shown time and time again in the past that they cannot be trusted to regulate themselves. It’s why we have the FDA, OSHA, EPA, SEC, FEC, NIST, NOAA, DCMA, TSA, FERC, and many others to numerous to list, all of which are tasked with regulating businesses, and were each started to combat the egregious violations and excesses of the business communities.

  43. Cimmer says:

    Thank you for writing this.

  44. A great post, but, please, no props for Henry Ford, not even backhanded. Ford’s much-ballyhooed $5-a-day pay package turned out to a cynical con designed to derail a union organizing drive. The rate didn’t apply to women workers or men either unmarried or under 22. And Ford gave thousands of older, married men the shaft by labeling them as “probationary.” He paid probationary hires $2.55 a day, then discharged them after six months — for new probationary replacements.

  45. Debbie says:

    Sarah, this post warmed my feminist political economist heart. Thank you!

  46. Barry says:

    K__: I decided it’s that the executives & high paid, high profile business persons are getting paid a bundle in exchange for being the scapegoat if/when the company is caught engaged in some cheating, destructive behavior. If it’s a bad enough offense the whole company could go belly-up and take most of the employees with it (Arthur Anderson/Enron) but management is likely to be held accountable for signing off on shitty decisions.

    First, how often does upper management really take a hit?
    Second, even if they do, upper management gets a sweet load of cash to tide them over until the next upper management job.
    Everybody else gets sacked. And they probably will be sacked for the decisions of others.

  47. Barry says:

    Dawn:
    One of the problems is I think that rich folks have forgotten that if the country sinks, so do they.

    The problem is that so far, it’s the opposite. The worse for us, the better for them.

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  50. David in Michigan says:

    Sarah, well said. Maybe you can explore luck in a future post. We don’t tax success (or hard work or innovation) we tax good luck. Sure some people with little, have little because they are lazy and shiftless bums, but that is not the norm. The norm is that those with less have had less luck.

    If you are born with a good IQ to wealthy college educated American parents – you have *done* nothing, you have been handed a great dose of good luck, and the vast majority of the difference between your life and the “illegal alien” that got rounded up from the slave like job at the meat packing plant – rests primarily on that one initial given. To paraphrase the great Molly Ivins being born on third base is often confused with having hit a triple.

    Socialism is all about sharing the LUCK, muting the downside by distributing some of the upside. Capitalism is about risk and reward. The bailouts were socialism for the rich, which we were told MUST happen to avoid calamity,they couldn’t possibly be expected to bear the risk they had taken on, but now they are incredulous that we dare ask THEM to share some of the good fortune that is the reward for all the risk that we just assumed for them.

    Lastly on the “taxing job creatorz iz terribad” theory… um buckets of bat guano! Logically, a “job creator” bumping into the terrifying 250k tax bracket, might as well hire someone with that portion > 250k thereby avoiding the tax. Indeed people miss the point that seems clearly supported by the data, that confiscatory top rates are about driving dollars out of consumption/hoarding and into job creation/investment. Rich folks under the 50, 75, and 90% tax rates built empires, empires require employees. A garage with a 100 cars in it does not.

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  54. As a libertarian, I don’t find your comment about Verizon objectionable at all. To too many people, libertarianism is simply a means of justifying the existing economic inequalities.

    However, you are wrong about this,

    “Henry Ford was a union-busting, Nazi-sympathizing jerk, but he understood that to be successful people had to make enough money to buy his product–automobiles. The economy we have right now is the direct result of people no longer understanding that basic concept. ”

    This is a common claim and certainly Ford saw himself as a benefactor to his workers, but the reality is that the real reason Ford raised wages was that it was economically efficient to do so. Ford at the time was losing far more from extremely high rates of turnover in the competitive Detroit labor market (there were almost 300 other automobile companies at the time, though obviously not all in Detroit).

    The claim that he did it so his workers could afford to buy his automobile seems silly if you consider that Ford had 13,000 employees in 1914 but was producing 202,000 automobiles annually (up to 500,000 by 1916) — not to mention his extreme anti-labor actions. The “welfare capitalism” that Ford became famous for seems more like the best PR spin a Nazi-loving scumbag industrialist ever fooled the world into believing.

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