Capitalism, The Best Solution to Poverty

[Brian Peacock]

Well yeah, it's difficult to imagine researching this from the pov of employees being willing to accept lower pay to stave off automation. We could get there though, and I imagine that it's closer to that in countries with strong union integration.

In the 1880s Marx was arguing that the onward march of technological progress would ultimately free workers from harsh labour and lead to a reduction to working time. This is one of the reasons he was keen to talk about work and the economy as forms of social rather than contractual relationships. In the 1930s John Maynard Keynes was predicting that automation would inevitably lead to a shorter working week - Keynes predicted a working week of 15 hours by the 1980s! - and around the same time Bertrand Russell was considering what the resulting "idleness" might mean for people.

I remember at a university interview - back when all this was fields - that in response to my boilerplate question about my post-graduation employment prospects my interviewer started going on about an increase in 'leisure time' that was just round the corner, and how the course would not only increase my employment chances but I'd have a lot more free time than previous generations to pursue my interests. Sounded great to me - although I ended up at a different uni in the end.

What a lot of people have assumed is that the productivity gains of technology and automation, of doing and making more things more quickly and cheaply, would continue to be fairly distributed - that people would basically get the same pay for fewer hours and that profit, asset, and wealth taxes would continue to contribute to the development of public services and the social progress that follows. Right, yeah.

[JimC]

Instead, so many people are struggling to make ends meet that they often have a second gig going - so much for the leisure thing...

Mind you, I actually am a man of leisure. I was very lucky that my superannuation scheme happened to be just about the best in the business, so I retired without needing another source of income...

[L'Emmerdeur]

We don't need no stinkin' workers' rights protections.

'Another bill to strip Kentucky worker protections advances in legislature'

Several pieces of legislation to erode worker’s protections in Kentucky have begun moving through the legislative process this year, including a bill to allow teenagers to work longer and later hours.

Another measure in that surge of legislation cleared a committee vote Wednesday. House Bill 500 would strip Kentucky’s meal and rest break protections as well as seventh-day overtime.

Both bills would weaken Kentucky labor laws, stripping them down to the minimum requirements of federal law. They also share a sponsor, Republican Rep. Phillip Pratt from Georgetown.

Pratt is the owner of a landscaping company that could potentially stand to benefit from both measures, and is not seeking reelection. He also chairs the committee that heard HB 500 Wednesday.

“I've often said, despite the best efforts of local, state and federal government, I've managed to succeed and keep my doors open,” Pratt said at the outset of the committee hearing.

Pratt’s landscaping business received nearly $300,000 in forgiven federal PPP loans during the pandemic. He said HB 500 would bring Kentucky in line with the Federal Labor Standards Act, a law passed 85 years ago.

“We create confusion for employers in Kentucky who must ensure compliance with [Kentucky Revised Statutes] as well as the [Fair Labor Standards Act]. The dual compliance challenge for employers is specifically difficult for those businesses that employ workers in multiple states,” Pratt said.

The state worker protections Pratt's bill would strip have been in place for decades. The Kentucky Center for Economic Policy and union leaders oppose the legislation, saying it would only hurt workers in the state.

[JimC]

I have argued that, in the capitalist system, the bosses will almost automatically head in the direction of skimping on the pay and conditions of their workers as far as they possibly can, unless held to account by governments with a social conscience. No such thing in Kentucky, apparently. Also, a good example of political and economic power fornicating happily in the same bed...

[Brian Peacock]

Political and economic power might be fornicating happily, but it's ordinary workers who are being fucked over.

[macdoc]

Jim Your argument is flawed if you think that "skimping" on labour is inherent. It's not...just like cutting corners on product quality or safety....they are all choices by management.
Corporate does have a power imbalance against the individual ....that's what unions are for IF required.
Some companies pay higher wages to avoid unions.

One of my annoyances is gov employ unions ( teachers for instance ) in critical functions.....should not have the right to strike in my view. ...job action yes ...strike no.

[Brian Peacock]

Funny how those 'choices' always come down on the side of paying employees as little as they can get away with rather than paying them the maximum they can afford eh? How much profit is too much profit?

[macdoc]

Complete conjecture on your part.
https://www.businessinsider.com/payscal ... -4#22-3m-1
For many companies keeping experienced staff is highly critical.

on the other hand....how many employees are overpaid for the work they do and hide behind unions covering their incompetence or simple laziness.

[rainbow]

Complete conjecture on your part.
https://www.businessinsider.com/payscal ... -4#22-3m-1
For many companies keeping experienced staff is highly critical.

on the other hand....how many employees are overpaid for the work they do and hide behind unions covering their incompetence or simple laziness.

...not as many as the corporate Empire Builders, who take credit for Other Bastard's Efforts.

[L'Emmerdeur]

A rosy future ...

'Both Dems and GOP "Completely Silent" as Macy's Guts Workforce After Rewarding Wall Street'

As the iconic 166-year-old department store chain Macy's this week announced a "bold new chapter" including a pivot to luxury stores, the closing of 150 locations across the United States in the coming years, and more than 2,300 layoffs, one labor expert is blaming the company's deference to Wall Street and an economy in which firms prioritize stock buybacks over investing in their workforce.

...

Macy's stock price has dropped 75% from its peak in 2015, pushing it to close nearly a third of its locations in less than a decade, but Les Leopold, co-founder of the Labor Institute, argued Wednesday that the company could have responded to changes in the retail market by "reinvesting to modernize and become more competitive," but didn't—"a classic story."

"Instead, they siphoned off the corporation's wealth to Wall Street stock sellers and top officers," Leopold told Common Dreams. "That virtually guaranteed that Macy's would have to close stores and layoff thousands of workers, in effect, paying for all those stock incentives."

Since October 2019, said Leopold, Macy's has "put $1 billion into stock buybacks" to elevate its shareholders' returns—about 20% of the company's current value.

Leopold—author of the new book Wall Street's War on Workers: How Mass Layoffs and Greed are Destroying the Working Class and What To Do About It—said that buybacks allow executives and investors to "legally loot a company" by "returning wealth to large Wall Street firms and top Macy's officers who received about two-thirds of the income through stock incentives."

Stock buybacks, which were considered an illegal form of stock manipulation until regulatory rollbacks under the Reagan administration, is a driver of mass layoffs like those announced by Macy's, said Leopold, noting that the Department of Labor identifies a layoff from a job as "one of the most traumatic events you can experience in life."

[Brian Peacock]

Complete conjecture on your part.
https://www.businessinsider.com/payscal ... -4#22-3m-1
For many companies keeping experienced staff is highly critical.

on the other hand....how many employees are overpaid for the work they do and hide behind unions covering their incompetence or simple laziness.

OK. So unions lead to people being overpaid for the work they do, as well as encouraging laziness in the workplace.

But who gets to decide what the 'correct' level of pay is? Well it's the employer of course, so all your doing is repeating "...the classical liberal perspective, which is that the employers side of the equation is the only valid basis for any form of economic and/or social analysis."

Nor can you really have it both ways: on the one hand unions lead to workers being overpaid. which encourages laziness, while at the same average boardroom pay is c.300 time that of average worker pay. Why doesn't that encourage laziness? Surely those guys with the shiny shoes must be really lazy and complacent at work, eh?

The fact is that investors, owners, and bosses like to believe that their high wages motivate them to give of their best, while also apparently believing that it's low wages which motivate their employees to do likewise. It is only possible to hold this paradoxical position if one is willing to accept that employers and employees are fundamentally different kinds, types, or classes of people.

[JimC]

Jim Your argument is flawed if you think that "skimping" on labour is inherent. It's not...just like cutting corners on product quality or safety....they are all choices by management.
Corporate does have a power imbalance against the individual ....that's what unions are for IF required.
Some companies pay higher wages to avoid unions.

One of my annoyances is gov employ unions ( teachers for instance ) in critical functions.....should not have the right to strike in my view. ...job action yes ...strike no.

Sure, they are choices by management, but it would be a pretty strange corporation that made choices which did not increase profits... Some of those choices (not all) will tend to be in the direction of reducing worker's pay and conditions (or at least limiting increases to below inflation). Note I said "tend" - there will be variability, but on average, without strong countervailing pressure from unions or government regulation, profits will trump conditions and pay for workers. That's the bottom line motivation for all capitalist institutions...

[macdoc]

No.
You completely ignore productivity which these days is far more important than labour costs for any first world industries.
Admit it it - you just don't like profit - as what you contend could easily apply to any social or religious institution.....
Many corporate policies, especially those with profit sharing policies for staff compete for the best and the brightest.
In too many cases unions or say organized religions or political parties protect workers who cannot be fired for the the most outrageous and sometimes criminal behaviour.

Maybe do some reading on Kellog and their approach to The Great Depression.

At Kellogg’s, 15% more shredded wheat cases were being packed per hour. Profits had doubled in 1931, versus three years prior. After five years with the six-hour day, overhead costs had been reduced 25%, labor costs 10%, with 41% fewer accidents. W. K. Kellogg said, “We can afford to pay as much for six hours as we formerly paid for eight.”

https://kadavy.net/blog/posts/six-hour-work-day/
Decisions that Kellog management made....nothing inherent at all.

[Brian Peacock]

No.
You completely ignore productivity which these days is far more important than labour costs for any first world industries.
Admit it it - you just don't like profit - as what you contend could easily apply to any social or religious institution.....
Many corporate policies, especially those with profit sharing policies for staff compete for the best and the brightest.
In too many cases unions or say organized religions or political parties protect workers who cannot be fired for the the most outrageous and sometimes criminal behaviour.

Maybe do some reading on Kellog and their approach to The Great Depression.

At Kellogg’s, 15% more shredded wheat cases were being packed per hour. Profits had doubled in 1931, versus three years prior. After five years with the six-hour day, overhead costs had been reduced 25%, labor costs 10%, with 41% fewer accidents. W. K. Kellogg said, “We can afford to pay as much for six hours as we formerly paid for eight.”

https://kadavy.net/blog/posts/six-hour-work-day/
Decisions that Kellog management made....nothing inherent at all.

Sure, when 'productivity' increases profits necessarily increase along with it [but let's not forget that reducing the workforce so the remainder can work harder for the same pay is 'productivity' as well] and as executive pay is routinely linked to profits so has boardroom pay. Profits have been returned to shareholders and used for stock buy-backs - further bloating executive remuneration and shareholder dividend. At the same time real wages have stagnated since 2007/8, household debt has tripled, families are living pay-packet to pay-packet, and the recent energy cost hikes have contributed to a cost-of-living crisis that sees c.40% of Americans reporting they lack the resources to cover an emergency expense of $500.

It's simply fallacious to chide Jim for just 'not liking profit' when it's clearly the fairness (or otherwise) of the distribution of the gains that actually are being made that he's talking about - and which are the issue here.

[JimC]

I recognise that making a profit is a necessary part of any capitalist business, and that it can be a source of new investment to grow the business. So, it's a great simplification to say "you just don't like profit".

However, it should be obvious that decisions that increase profits will be a no-brainer. Now, some of the mechanisms that increase profit might well be relatively benign. Better marketing, greater efficiency in energy and material inputs, innovative technological improvements etc. But the traditional options to increase profit margins will always be potentially on the table, the decisions that make the conditions and pay for workers as tight as possible, or that skirt the edges of health and safety rules, or that ignore damage to the environment. All I'm saying is that without pressures from outside the corporation (via unions, investigative journalism, informed public debate and, particularly, solid government regulation) it is almost inevitable that the interests of workers will not be taken into account. Part of the evidence for this is how corporations love to establish labour-intensive operations in third world countries where government protections for both workers and the environment are minimal and unions non-existent - profits increase well beyond what would be available in a regulated labour market.