Thursday, July 18, 2013

Have you no sense of decency, sir?

You've done enough. Have you no sense of decency, sir? At long last, have you left no sense of decency?

Those three sentences, eloquently delivered by Army Secretary Joseph Welch to Senator Joe McCarthy, were probably among the truest and most necessary of the times.  A declaratory sentence and two simple questions that delivered an amazing amount of benefit to the people and the nation.

Sadly, there is neither the forum, sense of outrage nor spokesman like Joseph Welch with the balls to deliver the same question today, not to Joe McCarthy, but corporate America.  America is "growing jobs" primarily in the minimum wage bracket.  To avoid offering certain mandated benefits, corporate America reduces the hours their employees can work.  Yet that same corporate America manipulates energy markets and the LIBOR with relative impunity, raising the cost of living for those to whom they do not choose to offer a living wage, while earning massive profits for their investors.

And then, one major source of non-livable wages has the audacity to publish a pamphlet for their employees, and anyone else unfortunate enough to work for a fellow traveler employer, to show them how, by simply working and additional 30 to 35 hours per week (in addition to the 35 they work at their "first job"), they can achieve "Financial Freedom".  Not only is the "budget" in the pamphlet pretty far removed from reality, but even with the understatement of what expenses a working person faces, you will see that they clearly state that it is impossible to live on the wages of your "first job".  But that's no problem - simply work an additional 30 to 35 hour per week, budget $20/month for health insurance, and you can save $1,200 per year for your future.

The answer, Mr Welch, is that there is no decency.  Absolutely no decency.


  1. You've touched on what I am ever more convinced is the real "clear and present danger" to the United States I grew up in, Al. The old social contract - that the wealthy would give up a little of their ability to harrow riches from the economy in return for social peace - seems to have completely broken. The people at the top seem ever more intent on driving down those in the middle back closer towards the great divide we knew before the Depression, with a tiny handful of hugely wealthy, a small "middle class" of technical and professional servents, and a large "underclass" to mop the floors, cook the food, and trim the hedges.

    The fearful unrest of those times has been forgotten, the frightful examples of the social results of such Bourbon arrogance - the fascist thugs in the streets, the communist mobs, anarchist bombings and rioting strikers - have been forgotten.

    So we continue down the road back to the Gilded Age, becoming ever more what we were without remembering the reasons we ever chose differently...

    And I cannot see how things change without an upheaval so terrible that it seems as likely to end in a Man on Horseback as a closer return to the Great Social Peace of the 1945-1975 era...

  2. Our elites do a terrible job of running the country. In nearly every index – infant mortality, educational attainment, patent applications, youth employment, incarceration rate, and life expectancy – the U.S. trails other industrial countries. To take life expectancy as an example, Americans die about three years sooner than the citizens of OECD countries and the gap is widening. Residents of some West Virginia and Mississippi counties would live as long in Bangladesh.

    I don’t know how long such gross mismanagement can be tolerated. Or what shape reform might take. A short-term military occupation on the model of Egypt might be in the cards.

    1. "I don’t know how long such gross mismanagement can be tolerated. Or what shape reform might take. A short-term military occupation on the model of Egypt might be in the cards. "

      From what little I know of Egypt, the military run large sectors of the country - they are a big proportion of the economic exploiters. The recent coup was marked by an immediate cessation (within a few days) of the economic crisis blamed on the president. This tells anybody looking that the crisis was false.

      You seem to be thinking of the military (here, or Egypt, or anywhere) as not part of the complex.

  3. Chief, Paul

    I really was amazed by the chutzpah of the brochure. The whole idea of telling an employee that all they need is two low paying jobs as a normal state of affairs in itself is preposterous. Then to offer such a blatantly outlandish budget that is both incomplete and inaccurate bowls me over.

    Yet, a friend of mine said this about the phamphlet, "Living on a budget has been and continues to be one of the items that Dave Ramsey preaches. Most people don't live and have never been taught to live on a budget. McDonald's is trying to help their people", oblivious to how patently offensive the budget being shown happens to be.

  4. Al-

    I think you'll find this interesting . . .

  5. Pfaff needs an RSS feed for his site.

    One thing I think he gets wrong is government as an obstacle for corporations. I think the opposite is true - the most successful corporations are those that engage in extensive rent-seeking. I also think it's a little much to expect corporations or individuals to ignore the incentives from goverent policy. If one wants Apple to patriate its overseas profits, then the thing to do would be to eliminate corporate taxes as well as special rates on capital gains. Apple would then bring the money to the US and either invest it or give it to shareholders who would then pay income taxes on it. Either one would be better than parking the money overseas.

    Finally, one thing no one talks about is corporate personhood and the 4th amendment - see Ed Snowden, Prism, and the corporations who gave the government access to the metadata under court orders.....


  6. seydlitz

    Thanks for the Pfaff link. While his description of the change in corporate values and behavior is spot on, not too sure he has his cross-hairs on the causes as accurately.

    Back in the late 70's, two of my grad school profs (one a public sector specialist and the other private sector) made similar statements about organizations' objectives - the easy way out was "accounting data". Numbers require no qualitative nor value judgements, and thus a cowardly business leader can do well by sticking to numbers. Perhaps it simply more and more cowards rising to the top of corporations?

  7. As a sort of sideways look at this as a "threat to national security" what it reminds me of is the politics of Third Republic France circa 1940. The two main political groupings, Left and Right, were so poisonously antipathetic that many on the hard fringes of their parties; the equivalent of today's teabaggers on the Right (and about a half-dozen anarchists living in a squat in Seattle on the Left - no idea what the actual mainstream equivalent would be) considered their internal political enemies a worse threat than the Germans.

    Obviously the Left has no spine at this point. But IMO if this sort of rapacious capitalism - the sort of crony-capitalism Andy discusses, with the big outfits obviously profiting through government policies that benefit corporate bottom-lines at the expense of working-class jobs - continues and builds there WILL be a backlash from the Left.

    And that has a real potential to do to the U.S. what it did for France in 1940; make the nation effectively incapable of responding to either internal or external threats, ranging from anthropogenic warming to a resurgent Russia or China...

  8. McDonalds is good at absurd numbers. In April, 2011, the announced a "National Hiring Day", hyping that they were going to add 50,000 jobs to their staffing in one day.

    From the Christian Science Monitor

    The new hiring, McDonald’s estimates, translates into an extra $518 million in annual wages and salaries, or about $1.4 million per day. This will help federal and local treasuries, since the income will result in $54 million in payroll taxes. Also, the hiring will generate an additional $1.4 billion in annual spending, or $3.5 million per day, the company estimates, using a statistical multiplier.

    “Their estimates are quite reasonable,” says economist Joel Naroff of Naroff Economic Advisors in Holland, Pa. “Especially since most of the people they are hiring are people who will likely turn around and spend the money.”

    Pretty impressive numbers, and most of the media, both general and financial gave them good press.

    However, someone at Forbes, divided $518 million in wages being paid to 50,000 employees and found that it translated to about $10,000 per year per employee.

    The Revolution ain't coming Chief, because the population, at all levels, is downright dumb.

  9. Andy-

    Pfaff writes that "government as an obstacle for corporations" as part of monetarist economic ideology, not how the economy actually functions. I think he would be very Weberian on this and see government regulation as providing a necessary stability to rational capitalism, which is not necessarily what we have today in the US . . .

    As to Al's comment on "the numbers", I have this clip from the classic film "Executive Suite" from 1954:

    The change is more than just an attitude, imo we're not even the same country anymore, let alone anything close to the same system of government . . .

  10. The "private sector" prof I mentioned above started the semester saying we should consider the following as the guiding principles of a business:

    1. A reasonable quality produce/service at a fair price.
    2. Stable employment at fair wages
    3. A reasonable return to the community.

    This always resulted in three questions:

    Q. How do you measure these?
    A. By leadership, not accounting techniques.

    Q. But what about profits? Shouldn't they be a primary principle?
    A. perhaps you should consider profits as an instrument to achieve these objectives, rather than the main object in itself.

    Q. Sir, you are a retired general Dynamics Vice President. Are you saying GD held to these principles?
    A. Not in any way, and the company, workers and community suffered for it.

  11. "The Revolution ain't coming Chief, because the population, at all levels, is downright dumb."

    That's kind of where I was going with the close of my fist comment: "And I cannot see how things change without an upheaval so terrible that it seems as likely to end in a Man on Horseback as a closer return to the Great Social Peace of the 1945-1975 era..." IMO the Great American Herd - and the idiots who have designated themselves its cowpunchers - will continue to blunder down this road to hell until things are simply so toxic that there is no real solution. At that point the nation is likely to disintegrate into damn near anything. I would be unsurprised in a sort of Early Imperial Rome, with all the trappings of the republic but the actual governing taken over by a small group or even a single individual...

    What a friggin' mess...

  12. IMHO, part of the dysfunction is "belief" and/or ideology replacing knowledge or understanding. With "belief", one need not admit they do not know or understand something. Just go with the party line or the flow, and just as you mindlessly accept something, you mindlessly reject anything contrary. As long as it doesn't obviously affect you directly, does it really matter if you got it right or wrong? McD's $518 million in new pay sure sounds like a lot of money so why think any further?

  13. The other night my wife and I went for a walk about the neighborhood. Nice part of Porto with a park with big trees that they used for dueling up to the beginning of the 1850s. That's recent history for this place.

    Anyway we're walking around and it occurred to me. What was happening here in Portugal was what had happened countless places before . . . the clearing out of the small businesses to make way for corporate domination of the economy. This is something that Corporatism? has in common with the other great ideologies of the 20th Century. Both Communism and Fascisms of various stripes (especially the Nazis) were very much for liquidating the small businessman. Why? Because the small businessman operates with other small businessmen/women together localized in significant mass to lead to the formation of patterns of social relations between the little "c" capitalist and their customers (not consumers). These merge with other community aspects to form integrated and functional communities given the usual social dynamics.

    But the ideologies don't like this. Since it interferes with their propaganda . . . and control. In stead of regimented and atomized consumers heading for the malls for the best deals, you have mostly women representing families going through a myriad of shops, socializing as much as purchasing, catching up on all the news while they engage in commerce.

  14. seydiltz: Instead of regimented and atomized consumers heading for the malls for the best deals, you have mostly women representing families going through a myriad of shops, socializing as much as purchasing, catching up on all the news while they engage in commerce.

    Relationships are central to the people in polychronic cultures such as Portugal, Spain, Italy and Greece. So far, corporatism has not been able to totally extinguish this. However, in the typical Anglo-Saxon, monochronic culture, relationships are not high on the list of imperatives, and a shopping trip generally needs to be "efficient", not the social event you describe.

    If we have trouble finding something in the nearby grocery store (neither of us is skilled enough in Greek to identify certain packaged items, such as specialty flour), the cashier does not say "go look on aisle 5", she stops what she is doing, leads us to the product we need, and then returns to check out the customers that were in line. "Foreigners" of some nationalities get their nose out of joint for having to wait a minute or two while this is going on, but Greeks take it in stride. What they would do with those two minutes is a mystery to me, but they sure do rant when they "lose them".

  15. Al-

    I experienced this to a lesser extent growing up in the South, than in Germany back in the 1980s. Very much a small businessman's haven. Until being slowly crunched out after the mid 1990s . . . same now in Portugal, across southern Europe . . . the imposed collapse of a human, social impulse, institution, a "piece of culture" necessary to sustain democracy? Who knows?

    The ideologies don't want anyone to know.

  16. then in stead of "than" . . . I'm out of practice . . .

  17. And one of the casualties of the widening reach of corporate power is the capability of individuals, communities, and nations to restrain the widening reach of corporate power.

    Fairly good summation of that here:

    The story of the 20th Century was the story of the first industrial nations (North America and Europe) beginning to legislate away the ability of businesses to do harm to the commons in pursuit of wealth and the reaction of the businesses (after an initial period of delay and adaptation) moving the hazardous operations to places where the laws and the governments were no more powerful or restrictive than they had been in Pennsylvania in 1920.

    So for places like Greece and Italy (and even worse for the more homogenized nations like the U.S. and Canada) the large organizations will respond by moving even more of their subcontractors into the poor fringe of the Third World to produce low cost goods and hitting the little retailers where it hurts, in the wallet.

    One of the companies I used to work for did engineering for ARCO's Am/Pm minimarkets. These people would look for new store locations on corners with existing mom-and-pop stop-and-robs, build their store on the corner across the intersection, run the new Am/Pm at a loss until they drove the mom-and-pop out of business, and then go their merry way.

    I cannot see how We the People benefit from this in the long run. Yes, we get cheap gas and pop-tarts, but at the cost of becoming wage-slaves instead of independent business owners ourselves...

  18. I personally blame the spreadsheet.
    That technology greatly reduces the cost of doing financial analysis. Thus ever more decisions are run through a financial model which rely on quantifiable attributes and unambiguous outcomes.

    Decision makers are therefore drawn towards situations where rent seeking (minimum cost, maximum revenue) and short term actions (because models are fragile and break down after while) dominate.

    Needless to say, there is no decency() function in Excel.

    And yes,

  19. In 1897, William James spoke at the unveiling of a memorial to Col. Robert Gould Shaw, who had led the 54th Regiment, the so-called black regiment. Shaw had enlisted as a private, was commissioned while serving the in the Second Massachusetts, and volunteered to take command of the 54th. He was killed at Fort Wagner. Survivors of the unit were present at the ceremony.

    James said that what made Shaw admirable was not his undoubted physical courage – natural selection has made us all fighters. Shaw had something more, he had “that more lonely courage which he showed when he dropped his commission in the glorious Second to head your dubious fortunes, negroes of the Fifty-fourth. “ Of 500 men willing to storm a battery, “perhaps not one could be found who would risk his worldly fortunes all alone in resisting enforced abuse.”

    James went on to say that a nation is not saved by wars. It is saved “By acts without external picturesqueness, by speaking, writing, voting reasonably, by smiting corruption swiftly, by good temper between parties, by the people knowing true men when they see them, and preferring them as leaders to rabid partisans or empty quacks.”

    That that is why FD Chief, Aviator, Seydlitz, Mike, Lisa and the rest of you guys should keep Milpub open and current.

  20. Unfortunately, the concept of every worker being granted human dignity is a lost notion. Now they are "human resources", which has devolved to them having no more dignity than the inanimate resources of the company. And, yes, "The Spreadsheet" and other forms of mindless automation has contributed to this.

  21. Seems someone took a look at McDonalds and figured the impact of them doubling the salary and benefits of ALL employees, to include their CEO's $8.75 million pay package. They say it would increase the price of a Big Mac by $0.68

    However, there is a big hole in the researchers' logic. Raising the cost by $0.68 will not result in that same amount of price increase. McD is not interested in $$$ profit, but % profit. Thus, a $0.68 per gut bomb cost increase would result in a markup of at least 100% to maintain profit %, and the resulting price increase would be $1.32 or more. The spreadsheets are % focused.

    Doesn't "Big Oil" quickly point out that their billion in profit are just a small % of total revenue?