Capitalism: The Loyal Opposition

February 28, 2012 at 12:27 pm (By Amba)

Interesting interview with economist Richard Wolff in The Sun magazine. His prescriptions are predictable, but his diagnosis is startling. Even if you do not favor direct government employment of the unemployed, or taxing the rich and corporations at 1960 rates, as Wolff seems to — ain’t gonna happen, so forget about it — he makes some strong points that are hard to answer about the particular ways wealth has been transferred upward.

He talks about how for the first time, after about 1970, there was no labor shortage (because of automation, offshoring, and women in the workplace), so employers no longer had to raise wages to retain workers, while workers had to work longer and harder—and yes, go deep into debt—to maintain or increase their standard of living. Result: productivity and profits increased, but the ones who were doing the producing didn’t share in the proceeds.

it’s been the best thirty years that employers in this country have ever had. More product was being produced, but employers didn’t have to pay workers more.

[The interviewer points out that we in the U.S. equate capitalism with freedom]

Yes, employers are free, in this system, to stop raising workers’ wages. But their exercise of that freedom has deprived the mass of Americans of a rising standard of living to accompany their rising productivity. Employers have kept all the benefits of the productivity increase in the form of profits [which were attributed to the genius of executives]. So one sector of our free economy has deprived another sector of its due.

This too was interesting, on deficits:

Then the government turns around and borrows money. It borrows from foreign governments, but also from banks, insurance companies, large corporations, and rich individuals who purchase Treasury bills, notes, bonds, and securities. In effect corporations and the rich can not only keep more tax dollars; they can then turn around and loan the money they kept to the government and earn interest on it. The interest that must be paid to them comes either from taxes levied upon the mass of Americans or from the savings the government achieves by cutting its payrolls and programs.

I’d love it if you would read and discuss this.  I’d love it even more if you did not assume I’m endorsing most of what Wolff says.  I don’t favor his prescription, but I did find these two points of diagnosis startling.  You know I am economically naïve, and these points may have been obvious to most of you.  But go ahead, try to explain them away.

You will say that entrepreneurs are rewarded with profit for risking capital and providing products, services, and work opportunities for others. I’m with you so far.  But squeezing ever more work out of fewer employees for the same or less real pay, stressing workers and families to the breaking point?  Mind you, Wolff is also critical of the overconsumption and overindebtedness of the average American family — yet that, too, has been one of the engines driving profits until recently.  Moral disapproval of that behavior from those who’ve encouraged it and profited from it . . . well, it smells a little.

Can we conceive of a system that would encourage and reward productivity, not just extort and exploit it? And how could that come about (could it?) without empowering the government as enforcer?

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61 Comments

  1. Dave Schuler (@tsidjs) said,

    It’s an interesting interview. I agree with his short term prescription and disagree with his long term prescription.

    I think there’s something he ignores. Why did union members take their increases in compensation in the form of benefits (healthcare, pension) rather than in the form of stock or stock options? We could have had employee-owned industries. We don’t because employees didn’t want them. Why?

    Finally, I think that Dr. Wolff holds out an alternative that does not, in fact, exist. The United States, the EU, Russia, China, and Japan all use different forms of capitalism. There is no alternative to capitalism waiting in the wings to be deployed. Just different forms of capitalism. We’re stuck with it.

  2. Icepick said,

    Schuler touches on an important point: Not all compensation is “cash now”. Pensions and, especially, health care costs borne by emplpoyers should count towards total compensation.

    On that front, we have seen pension coverage shrink in this nation ever since ERISA went into effect in 1974. Each successive wave of pension regulation has driven more private employees out of pension systems. When I was in pension consulting the senior consultants referred to government regulation of pension plans as the Goose That Laid the Golden Egg. Even though there were fewer plans, each new wave of legislation meant more work for them. At least until the government managed to kill off all the pensions. (Hasn’t happened yet, but I hear from my contacts that lay-offs happen every couple of months – they’re just done office-by-office so that the company doesn’t really need to announce anything publically. So much for the recovery.)

    HC costs are also heavily subsidized by employers. (This is an artifact of WWII wage controls – so in fact one can blame Hitler for our fucked-up health care delivery system!) And what has been happening for the last 10 to 20 years is that as those costs are going up employers are increasingly finding they need to push more of the burden onto their employees.

    Anyway, before I could comment on his overall views I’d have to dig out what he considers as compensation and see if the trendlines match what he says. I think that if HC is added back it things don’t look as flat post-1970, but that’s a helluva lot more work than I’m willing to do for free! The 60 trillion dollar world economy has said my time is worth nothing but I’m not accepting that!

    Also, it really makes no difference anyway. Since ACA (aka ObamaCare) has passed, my familiy’s out of pocket costs have soared even beyond our health issues, and I see no end to that in sight. I also don’t expect either party to do anything sensible on this front, so I don’t really think there’s much reason to waste brain cells contemplating the issue.

    But then I have been feeling defeated lately, after a brief surge of optimism was brutally crushed…. (Hope was the absolute worst thing to come out of Pandora’s Box.)

  3. karen said,

    I am not a very savvy when it comes to business or money, either. My one rule is that i just never use plastic.

    I have often wondered if only one person were the breadwinner in a family– and this was accepted country wide to have one earner– if the workforce wouldn’t have some kind of positive major shift to accommodate for the upheaval created w/in it.

    It seems to me that the need for two earners is some kind of self-fulfilling lifestyle prophesy we imposed upon ourselves(i am also naive, amba:0)) I think maybe to begin w/-before the pace of expense and want caught up w/us all- yeah- it worked well to widen our minds w/2parent breadwinners. Since then, we’ve coined words like latchkey kids and daycare kids, and what all to account for our ever increasing need to work harder, longer for not nearly what we’re worth just to keep treading h2o.

    If… IF- every 2nd earner dropped out of the workforce, wouldn’t it solve the unemploymt issue and wouldn’t it give families back a much needed home caretaker- mom or dad- and wouldn’t it save on the extra expenses of working outside the home.

    It’s archaic, i know. I live in the dark ages, still. Heh, we have only one vehicle. It’s just cool to think that in my kinda perfect world, one person would be able to earn more in this way. I’ve just always wondered what would go down if this happened? Of course, it’s like the dairy industry… no two farmers would ever agree to the same remedy even if it meant more money for their product. If all farmers would sell 10 cows, the supply would be in demand- farmer #1 sells 10, farmer #2 buys 10– so, there you go.

    In a perfect world…

  4. Icepick said,

    Karen, there may have been a brief time when families only had one bread-winner, but that typically hasn’t been all that normal. heck, you know this living on a farm. Could your farm operate if only you or your husband did that work? That has beena true on farms since way back.

  5. Icepick said,

    And Dave, I’m thinking this would be a great topic for Ben Wolf to comment upon!

  6. mockturtle said,

    Karen, you make an excellent point about dual breadwinner households. I have long believed that it has forced the cost of everything up because households can afford more and it makes one income households unable to keep up, forcing them into poverty. Wolff touches on this but doesn’t follow it to its logical conclusion.

    Icepick, you bring up an important issue regarding compensation. Health care benefits have grown astronomically along with ridiculously high health care costs. IMHO, this is largely due to increasing government payment systems which, like the dual income household, allow the health industries to charge more. So workers’ benefits should be taken into account when looking at total compensation.

    While Wolff makes some valid observations, he errs is in blaming Capitalism. Yes, Capitalism is an inherently unstable system . But it does create capital. Government does not. And, to paraphrase Milton Friedman, government is not there to take care of people, it is there to take care of itself. Any notion, however altruistic, that the government can solve economic problems will inevitably result in bigger government and more debt. The best thing the government can do is to get out of debt. [and abolish the Keynesian notion that government should go into debt to stimulate the economy].

    No, it’s not a perfect system and we, as consumers, should exert more influence than we do on banks, oil companies, etc. and lobby our congressmen to stop subsidies [it is not ‘free enterprise’ for the federal government to subsidize or bail out failing businesses]. But it’s the best of all systems and increased government involvement will only make a bad situation worse.

  7. amba (Annie Gottlieb) said,

    I quite agree that capitalism isn’t going anywhere, and shouldn’t. But, obviously, capitalism is somewhat within our control and choices. It’s not just some huge lizard-brain force of nature that we can only either accept or impotently protest.

    Dave, is it really true that unions were widely offered a choice between stock, or stock options, and benefits? When? And was that widely turned down by union leaders or union voters? I’ve never heard this.

    If that is true, and workers themselves chose benefits, it suggests that they saw security in terms of being taken care of, which is somewhat disturbing. Nowadays, anyway, it is hard to imagine putting that much trust and dependence in institutions.

    I’ve said this before, but it’s the “profit patriotism” of many corporations that bothers me. That is, while they may preach patriotism, many in practice seem to have no loyalty to their country or their community or their workers. They are out to get as much and share as little as possible (and then they make highly-touted contributions to charity or culture for PR window dressing), and by “share” I don’t mean in the communal sense but in the rewarding-productivity sense. Market forces are a poor excuse for exploiting workers just because a buyer’s labor market makes it possible to do so.

    I am always amused by how conservatives despise biological Darwinism but celebrate economic Darwinism. I am but the tool of the great Market. My lizard brain made me do it. Applied to economic behavior this is regarded as heroic and Ayn Randian.

  8. Maxwell James said,

    Dave is right that in past decades, large swaths of the US workforce had the opportunity to engage in broad-based ownership systems and rejected it. This was most notable in the auto industry – as late as 1985 or so, GM actually had an ESOP for instance. The union sold it in exchange for other benefits. I think there were a lot of reasons for that – for one, they saw the writing on the wall, both in terms of the auto industry’s decline and the rise of healthcare/retirement costs, and two, an ownership culture would have meant rejecting the adversarial approach that was their core competency.

    I think there’s a future for broader-based ownership approaches – but not along the lines of what Wolff’s talking about, which is again based on an adversarial approach. Note how he’s talking about using stockholder democracy to keep firms from offshoring for instance. This is a frustration I’ve had with the cooperative movement – so many are focused on rejecting “capitalism” (again, what Dave said) that they miss the bigger picture. Democratic ownership isn’t just about “giving” more people a voice – it’s about increasing their engagement, which frankly means increased risk as much as increased rewards.

  9. karen said,

    Icepick– my husband and i are the only ones working our farm. Granted, we have no great land base, but the animal care is labour intensive(we have 110+ head)- unbelievable– and the worry we carry for our animals health– well, not to get too depressing, but we just had to put a good cow down today.

    We are tired, we can’t wait for pasture time, and we never take time off(never had a vacation)(or a weekend). I do get some chores off– my husband carries the heavy yoke. We got the evening off for my husband’s brother’s wake this past Sept. Because good friends were worried for us and they did it for us w/out pay.

    This is all our choice, obviously. I do get to stay home, i (attempt)the book keeping duties and we spend a lot of time together- so that’s a plus. Sometimes(often)we think we are plumb crazy doing this work. The going thing was to trend bigger– run on a bigger rat wheel and then get to hire someone, but that’s not cool for us, either. There are a lot of Mexican or SAmerican workers up in our neck of the woods. Not many young kids- or anyone else- wants to work this hard anymore. Back in the day, it’s what paid a lot of teen boys wages, esp during haying. Not anymore.

    This is a business, so IMhumbleO, the rationale of not helping out would be like trying to squeeze some form of fruit into another’s(sp)round hole. Better have a cup handy for the juice:0).

  10. Maxwell James said,

    I should have added three: the 1986 tax reform eliminated an incentive for employee stock ownership plans. See here:

    http://articles.latimes.com/1989-06-03/business/fi-965_1_esop-payments-salaried-general-motors-corp

  11. amba (Annie Gottlieb) said,

    an ownership culture would have meant rejecting the adversarial approach that was their core competency.

    Ah! that sentence is a thing of truth and beauty.

  12. amba (Annie Gottlieb) said,

    In other words, they were going not only for dependency but for antagonism — the M.O. of an adolescent.

  13. amba (Annie Gottlieb) said,

    Democratic ownership isn’t just about “giving” more people a voice – it’s about increasing their engagement, which frankly means increased risk as much as increased rewards.

    And increased responsibility. You can’t just go home, have a beer and sit in front of the TV when your day’s work is done, or collect your gold watch and pension when your life’s work is done.

  14. Maxwell James said,

    To be fair, I think that’s probably is as true for management as it is for union leadership. Almost, anyway. Adversity becomes habit forming after a while.

  15. amba (Annie Gottlieb) said,

    Karen, which cow? What happened to her? :(

  16. karen said,

    I know i’ve mentioned before in another thread, but i feel the healthcare system is being held hostage by a straw man. My sister– an RN, blames the insurance companies, but i feel that the entirety of the profession– the professionals– are the product and they should have some say as to how they are marketed. They, ultimately- hold the power, but our boxes are bigger than our brave, little hearts when it comes to making the hard choices, i fear.

    Big Pharma is a bully, too.

  17. karen said,

    Lucky.

    We’ve gotten a bug that creates bad milk– Klebsiella- an e. coli that i seem to have misspelled. It’s usually fatal– we lost Patty a bit over a week ago, but her dying didn’t hurt so much as Lucky because Lucky really had a heart to stay upright. It’s like, she beat the bug, but in so doing, she damaged her entire system. Her lungs were damaged and she had absolutely no appetite. Today, the vet cked her out and suggested she be put down. We could have attempted to treat her, but we have put a few hundred(haven’t gotten the bill yet)into her already w/no… luck.

    I guess it ran out for her:0(. She was Si’s cow– each kid gets a cow and gets the $$$$ from one sale. We sold Lucky’s (only)daughter, Lullabye, last fall to a farmer in NY, so she has that money, anyway. She doesn’t know about Lucky, yet– but, she seems to take these sad affairs of losses in farming a lot better than i ever have, so my fingers are crossed.

    Lucky was born 7-07-07, she was very young. And a freaking monster of a girl.

    Farmers all over have stories and heartbreaks like these. It’s not that it’s not a big deal, it’s just that, some people get overly attached to a ~thing~ that is supposed to only make money(as i say, nodding and pointing to my self).

  18. amba (Annie Gottlieb) said,

    Karen, if people can get attached to a car, what to say about a living “thing”?

  19. mockturtle said,

    I’ve said this before, but it’s the “profit patriotism” of many corporations that bothers me. That is, while they may preach patriotism, many in practice seem to have no loyalty to their country or their community or their workers. They are out to get as much and share as little as possible (and then they make highly-touted contributions to charity or culture for PR window dressing), and by “share” I don’t mean in the communal sense but in the rewarding-productivity sense. Market forces are a poor excuse for exploiting workers just because a buyer’s labor market makes it possible to do so.

    That is absolutely true! And in no way would I defend these corporations and their practices. The question is: What do we do about it? A lot of us joined in the ‘move your money’ [to smaller local banks] exercise a couple of years ago and the big banks took notice. And B of A retracted their plan to charge for debit card use after a general outcry. Boycotts worked in the 60’s [at least we thought they were working!] and they will work now. I share the same criticisms that Wolff stated but disagree with the solutions. People–as citizens and consumers, not big government, are the solution. And the notion that our current government is ‘of the people’ is naive. Part of what created the behemoth of global capitalism run amok is the way our government is run. And that is largely due to sheer apathy on our part as uninvolved citizens.

    OTOH, if the bailout money had been given to the American people instead of the corporations, the slump would have been over by now. Good grief! If the government feels compelled to take up the reins of economic recovery, they could at least steer the money-wagon toward those who will spend it on more than bonuses, acquisitions and golden parachutes.

  20. Icepick said,

    Good Lord, I take a short nap and look what happens….

  21. Icepick said,

    That is, while they may preach patriotism, many in practice seem to have no loyalty to their country or their community or their workers.

    Wait, are we talking about corporations and its managers or government and politicians?

  22. mockturtle said,

    Wait, are we talking about corporations and its managers or government and politicians?

    Precisely!

  23. Icepick said,

    I should point out that when discussing what unions have done, it is necessary to remember that we’re actually talking about what union leadership has convinced its membership to do. I’ve seen that it is easy for a company to get union leadership to agree to plans that are bad for the membership as a whole by offering benefits that will only apply to very senior members of the union – i.e. the union leadership.

  24. karen said,

    “People–as citizens and consumers, not big government, are the solution. And the notion that our current government is ‘of the people’ is naive. Part of what created the behemoth of global capitalism run amok is the way our government is run. And that is largely due to sheer apathy on our part as uninvolved citizens.”

    Yes!! Same goes for healthcare. We are so busy trying to get the best deal and not get raked over the coals, we’ll believe anything(huge generalization here)to save a bit, not realizing the huge grafting process that doesn’t lead to good growth(as in an apple tree)but greed that boarders crime so closely they would have to be surgically removed– and i don’t give a rat’s behind if it’s w/a scalpel OR a freaking chainsaw, at this point.

    ps The cow s both got a Coliform mastitis– e coli and klebsiella are different forms(species?).

    o/t- just heard on the news– further attempts to separate Church and state– a woman in Redding(or Reading)VT is going to court to stopTown Meetings from opening w/a prayer. This 10-15 second act of humility and asking guidance from God so upsets her she goes home after Town Meeting and cries. If she gets her wish and a tradition as old as the town is put to an end– should one person have so much control over a democratic practice of voting this tradition “nay” or “yea”?

  25. karen said,

    I read somewhere that Apple iPhones will never be made in the US again as it only costs about 8$/phone in China to make.

    Is that true?

  26. karen said,

    We belong to 2 milk co-ops– have a lot of $$$$ tied up in them– esp Organic Valley. We had to buy equity.

  27. Dave Schuler (@tsidjs) said,

    As fate would have it I’ve posted on the labor costs of the iPhone 4 over at my place. $8 is close enough.

  28. kngfish said,

    I’m reading the article….and writing free-form notes…..

    1.) why place so much emphasis on hard work? Mules work hard, and they don’t feel entitled to have Ferraris! Plus, isn’t the point about productivity to deliberately make us work less?

    2.) Computers are merely the latest in a string of devices from Cotton Gins to Washing Machines that cut labor costs. Computers are those devices that get this saving from ‘mind work’, most of which is boring grinding and not creative thought.

    3.) Why not view the drive to lower costs as not belonging to countries, but to money as it flows around the world as best it can? If we can get strawberries from Chile in February…money will go where it will.

    4.) All of what he is saying points to an end of work world….so why tie work to ‘what we earn’? No one ‘earns’ anything.

    5.) Isn’t the fact we have such surpluses in labor something we ‘bought’? That is, if, for example, we ‘tightened’ the labor market by insisting women go back to the older standard….well didn’t we decide that we didn’t want women limited to just that role?

    6.) What we have bought with the increase in wealth is a broader deeper culture, perhaps? And it’s not as if this process were ending! China, India…both going through what we did decades ago.

    7.) His use of ‘denial’ makes me, well, smirk! No denial, just more acceptance of the swings of capitalism then he would like. And at the end of the day….the entire world has almost 40% more goods and services then it had in 1960.

    8.) He talks about profit like its coins in Scrooge McDuck’s Money Bin. It isn’t…because it wants more profit. Maybe the growth in profit is in the 2-3 billion people who’d like to have slightly more than they do….and not in the US or Europe.

  29. kngfish said,

    I finally gave up on the article….too much confirmation bias for me.

  30. amba (Annie Gottlieb) said,

    #28 should be posted at The End of Work.

    Yes, that article comes to a stupid conclusion, IMO, which is that there is some better alternative to capitalism. Evidently that was his hidden agenda all along, yet he started out saying we should be able to criticize and improve capitalism. Bad faith, there.

  31. Ron said,

    We need to lose the idea that work has the meaning it once had.

    There were times reading that article when I felt if it were 1900, he’d be saying “Who needs these ‘manufactured goods’? The farm was work for nearly all of human history; who are we to change that? Plus, we know it’s the wealthy elites who want factories, not the working class!”

  32. Ron said,

    Hey! We can all do this! http://fiverr.com/

  33. mockturtle said,

    LOL! There you go! The key to the modern [post-modern] economy. Or maybe bartering is the answer. Believe it or not, it is catching on in some areas around here. Nice to see! Maybe we could eliminate money altogether. ;-)

  34. Ron said,

    In the future…the currency is eyeballs! #ew!

  35. Stephanie said,

    Amba, in response to #7… I don’t think workers took benefits over stock in order to be taken care of, but because there was less apparent risk. If I told you you could either have $100 in a stock account now, or $1000 in 10 years, which would you choose? The stock may or may not be worth $1000 in 10 years- but $1000 is $1000. If you believed the company is going to keep it’s promise, then that seems like the less risky option. As far as the automotives go, the unions have been accepting blocks of stock in lieu of pension/healthcare obligations for the last five years to shift the risk from the company.

  36. mockturtle said,

    My company stock has tanked over the years. It’s not always the better option.

  37. karen said,

    “… most of which is boring grinding and not creative thought.”

    Since when??(winkwink)

    Bartering is much frowned upon come tax time. Uncle Sam McScrooge Duck doesn’t wanna get F%&*ed.

  38. realpc said,

    “Yes, employers are free, in this system, to stop raising workers’ wages. But their exercise of that freedom has deprived the mass of Americans of a rising standard of living to accompany their rising productivity.”

    Ok, I only read your post, not the actual article, but this is exactly the kind of thing that I so extremely and utterly cannot agree with. Maybe I shouldn’t say anything without reading it, and I am jumping straight to the conclusion that this is utter progressive/materialist arrogance. And just plain false on top of that.

    For one thing, if technology makes workers more productive, why should employers have to pay them more? The employers invested their money in the machines that make the workers more productive. The workers are not working any harder.

    And for another thing, why do Americans assume their standard of living is supposed to rise infinitely, just because? If your standard of living is good, be happy with that, don’t go into debt so you can seem to be as rich as your neighbor.

    To me, it’s just insane to think that everyone has to be rich, and to constantly get richer, just for no reason except that it would be nice. Well a lot of things that would be nice are just not possible.

    And why does he think the government has the ability to control the economy and make things nice for everyone? That is the progressive fantasy world.

    The world is not under human control. It just seems as if it is, to progressives. I am not trying to glorify conservatives, but at least they know this is not our world to bend into whatever fantasy we think would be nice.

  39. realpc said,

    “I am always amused by how conservatives despise biological Darwinism but celebrate economic Darwinism.”

    That is not true at all, that is a misinterpretation contrived by people who do not understand either Darwinism or nature or the economy.

    First of all, i am not speaking for conservatives. I think I represent holistic thinkers, and we just happen to have more in common with certain kinds of conservatives than with progressives. Progressives are utterly non-holistic, whether they know it or not. Their thinking is utterly reductionist and materialist.

    Conservatives, or holistic/spiritual thinkers, do not despise biological Darwinism. We just know it is a confused and inaccurate theory. Darwin did not discover the cause of evolution. However, he did discover and explain natural selection and survival of the fittest — and he was right about that.

    I know I have said these things about 4 zillion times at this blog. But I did not expect amba to make exactly the same mistake as progressives in misunderstanding evolution theory.

    And conservatives — the ones who are not extremist wackos that is — do not “celebrate” economic Darwinism. We accept it as the way the universe works, the way nature is, and we can’t do anything about it. We humans are not in complete control of this universe, we only feel like we are.

    It is an illusion, the feeling of being godlike and unlimited. I can’t stand a lot of things some conservatives say, but I prefer conservatives 10 to 1 over progressives, because at least conservatives in general feel they are merely part of something infinitely greater. Progressives, on the other hand, feel they are something infinitely great.

  40. realpc said,

    “But, obviously, capitalism is somewhat within our control and choices. It’s not just some huge lizard-brain force of nature that we can only either accept or impotently protest.”

    We if you assume that nature is stupid. I don’t believe that at all. Nature is infinitely smarter than we are and no, it’s job is not to always make sure we are safe and happy.

    It might seem like humans can easily push the economy around, since supposedly we create it. But we don’t really create the economy any more than we create the weather. These are complex natural systems. They are much bigger than we are.

  41. realpc said,

    And by the way I am not saying we humans can’t do anything about anything and shouldn’t even try. But the things it seems to me we can and should be doing something about, we mostly just ignore.

    For example, the government has some very definite jobs it’s supposed to do, including making and enforcing laws. If anyone cared about this, we could have cut way back on the corruption and thievery in our society that has caused many of our current problems.

    But instead progressives want the government to hand out money and jobs. This is not practical except to a very limited degree, and even if it were it would not help.

    And most of what humans can do to help the economy is on the individual level. We don’t always have to be crazed and go along with everything everyone is saying and doing. Because A LOT of what people are saying and doing is really crazy.

  42. amba (Annie Gottlieb) said,

    Your take on the article, not having read it, is partly right and partly wrong.

    The increased productivity he’s talking about is perhaps partly due to machines, but machines have their own productivity that displaces people. What he’s talking about is fewer people doing more of the work that only people can do, working longer hours, simply to keep the same amount of real pay they had 30 years ago and not to lose their jobs. If fewer people (people are expensive) are working harder and more efficiently and their employers are profiting from that, up to a point it’s fair that the employer profit because s/he is providing the location and occasion for. Beyond that, it is exploitation. (I use that word in spite of and not because of the fact that Marx used it.)

    I have a specific example in mind. A friend of mine manages a firm the partners in which recently increased their personal annual take from between 1 and 5 million to closer to 10 million. Apiece. A government regulation was passed that gave the firm an enormous amount of work for wealthy people and a financial bonanza. An immense amount more work was generated for the staff as well. More people were not hired to handle the load; the partners simply got a lot more time and work out of the manager and secretaries, who were not about to complain in this job market. No raises. Then they gave them $1000 bonuses. That’s just obscene. The sentiment behind it is, “We’re screwing you because we can.”

    Yes, Wolff is a progressive, as it turns out when you keep reading, and his prescriptions are preposterous. What struck me, though, early on was his account of these two ways wealth is actually transferred upward: through increased, unrecompensed productivity of the workforce and through selling debt. I don’t think conservatives can deny these. Usually all you hear is that the widening class gap is due to the little guy being unimaginative or lazy or just something less than an entrepreneur, while the captains of industry are bold and energetic pioneers, and that the difference is due to . (I also don’t think people should always need to get richer and consume more — although, if the middle class shouldn’t be driven by that, why is it OK for billionaires?) I’m more concerned with the unfairness of not sharing in the fruits of your own productivity than with the question of whether people should always expect their living standard to rise.

    Well, I need to work and I’m falling asleep . . .

  43. realpc said,

    “Usually all you hear is that the widening class gap is due to the little guy being unimaginative or lazy or just something less than an entrepreneur, while the captains of industry are bold and energetic pioneers, and that the difference is due to ”

    Yes there are plenty of unthinking uncaring conservatives who love simple explanations. That’s why I don’t like to say I’m a conservative.

    There is a lot wrong with our system, but the progressives do not have sensible answers and they do not, in my opinion, analyze the problems correctly.

    There are unthinking people on either side, but when a conservative actually thinks they are more likely to make sense than when a progressive thinks. in my opinion.

    The only thing, in my opinion, that solves our problems in the long wrong and keeps things reasonably fair is OPPOSITION and CONFLiCT. So, it’s just the opposite of what the progressives are always dreaming about.

    At least conservatives seem to understand the inevitability and necessity of conflict.

  44. amba (Annie Gottlieb) said,

    I certainly don’t think nature is stupid. I think its complexity is beyond what science will ever manage to understand, and that it probably is shot through with many levels of purpose and conscious intent. But neither are we merely passive, fatalistic puppets of forces without and within. We are active participants, like other animals. We make choices and our choices enter the arena of forces as a factor, even when they are not entirely consciously made and when they have unforeseen consequences. We are not compelled by nature to choose to screw our fellow human (in either sense) whenever we can get away with it.

  45. realpc said,

    [That’s just obscene. The sentiment behind it is, “We’re screwing you because we can.”]

    Yeah well the point is, if there were other better places to work, they wouldn’t get away with it. That’s why competition is the answer to just about everything in life.

    No, I don’t mean we don’t need cooperation. I just mean we need both.

  46. realpc said,

    “We are not compelled by nature to choose to screw our fellow human (in either sense) whenever we can get away with it.”

    No we aren’t, but we are compelled by nature to take care of our own survival. And that fact alone makes us not anywhere near as nice as we think we are.

  47. realpc said,

    “But neither are we merely passive, fatalistic puppets of forces without and within.”

    It is not either/or. We are intelligent creatures who are part of something infinitely more intelligent than ourselves. We can do certain things, but we are very limited. Progressives do not have any sense of human limitations.

  48. amba (Annie Gottlieb) said,

    We humans are not in complete control of this universe, we only feel like we are.

    Huh?

    We’re not in control at all, but neither are we only passive puppets of vast unconscious forces. That turns into that kind of Nazi mysticism that Mircea Eliade promoted. That kind of nature worship is where New Age meets fascism.

    I think progressives are more full of shit than conservatives, but conservatives are full of their own kind of shit, and all they are doing (all any of us are doing) with their ideology is justifying what they themselves want to do.

  49. realpc said,

    “I think progressives are more full of shit than conservatives, but conservatives are full of their own kind of shit,”

    Well I think I said that also. And I would never say we are passive puppets. Things are not black and white, and we ultimately don’t understand much, as I think you agree.

  50. amba (Annie Gottlieb) said,

    I’m actually being very amused by the hubris of science these days. (I have an assignment to copyedit a book about “the Singularity.”) Religion is probably in large part a search for immortality, and people who would once have clung to the belief in Heaven now cling to the belief that science is going to conquer death.

  51. amba (Annie Gottlieb) said,

    Here’s my question, I guess. What would the partners in my friend’s firm have to lose by giving their staff modest raises or larger bonuses, in recognition of the hard work they have done to contribute to meeting the new demand and increasing the partners’ wealth? They might even have something to gain: grateful employees, and those who felt they were, at their level, a part of the enterprise rather than just its cannon fodder, might work even harder and more willingly. What do people get out of being that stingy? It can’t be the few dollars’ difference it would make to them. It’s something about their self-image as hard-asses, or something. Some Scroogian notion that if you’re even a little bit soft, if you relent for a moment in your rapacity, the jackals will be all over you. I don’t understand people with no upper limit to their avarice, no concept of “enough.” I suppose they are competing with each other.

  52. kngfish said,

    Annie, I certainly agree with the spirit of your last remarks! I think, over time, people set up a new standard that has nothing to do with money, per se, but who determines. I had a friend who said in a contract negotiation, “you can have what you want, but what I want is to be who defines what ‘profit’ means”. That’s when you know things are broken; it isn’t about money, but who can say what has value.

  53. mockturtle said,

    There are many companies, large and small, that treat their employees well and reward them generously. I worked for about ten years in R&D of a very large company that did just that. But there are also many that only care about the bottom line and a bigger market share. IMHO, it is also each employee’s responsibility to work toward these goals. It should not be an adversarial relationship. The employee should be thinking, “How would I want this job done if I owned this company?” Unfortunately, integrity on both sides of the equation has been diminished along with the basic morality of our culture.

  54. kngfish said,

    mockturtle, about ten years ago I was in a situation that was a blend of what you mention and Annie’s remarks. I was part of a 3 person small company that was having success with software w a large company…it made the owner a good amount of cash, and the other 2 of us…considerably less. Still good, but we wanted to really grow it so we could do well also, and our customer pushed us quite heavily to do so as well! Ideal, right? But the guy running it preferred to keep it small; he would do well, but we would get the crumbs off the table that he would allow us to have. Here’s the problem; he would prefer to do well himself and have us make nearly nothing (by comparison) than to do 20 to 30 times better for himself and have us make a much, much bigger chunk than before. He didn’t see the money he would make, he saw the money that we ‘stole’ from him, that is to say, made without his direct approval.

    Power over ‘little people’, not money, made him feel he was ‘accomplishing’ something. And he wasn’t the only person I’ve met like that.

  55. mockturtle said,

    Well, yes, there is that. BTW, kngfish, I posted a note for you today in this segment: Dalma Heyn | A Godsend: A Love Story For Grownups below.

  56. realpc said,

    “What would the partners in my friend’s firm have to lose by giving their staff modest raises or larger bonuses, in recognition of the hard work they have done to contribute to meeting the new demand and increasing the partners’ wealth? ”

    That is not the point. The whole point is — how do you force employers to be nice and considerate to their employees? Anti-capitalists really think these things can be forced by the government. The government can force everyone to obey laws, but what you can do with laws is limited.

    The best way to make things fair is to allow competition. The problems we have right now are partly because Wall Street and the US government work together, instead of being in competition. So there is nothing to prevent them from being corrupt.

  57. mockturtle said,

    The problems we have right now are partly because Wall Street and the US government work together, instead of being in competition.

    Yep!

  58. amba (Annie Gottlieb) said,

    Double yep!

    Although I don’t think the government, by definition, can compete. In practice, that would turn into controlling/regulating. That’s the only kind of adversarial relationship it seems government and private enterprise can have. And deregulation or regulation loopholes then become one kind of favor the government has to sell.

    This idea seems really important to me: Nobel Prize-winning economist Douglass North on “the Natural State.” North says “limited-access” social orders, which we would see as cronyism (capitalist or otherwise) and the monopolizing of power by self-perpetuating elites, seem to be the natural way for large societies to organize themselves, and “open-access” social orders, which allow access by merit and are protected by competition, are a rare achievement. Once you grasp this idea, it becomes very clear how an open society is always tending to almost gravitationally revert back to the natural state. Once you see that inertial trend at work in our own society, you see what amazing tools the founding fathers gave us to fight it, but you also see how much vigilance and ingenuity must be employed in using those institutions to keep open access pried open as the heavy door keeps falling shut.

  59. amba (Annie Gottlieb) said,

    That seems so worth pondering that I’m going to make it a post.

  60. kngfish said,

    mockturtle, thanks again for your Dostoyevsky remarks! I haven’t chatted (or reread!) about him in a long while….You may inspire me to do so, but I also have an old translation. BTW, I did recommend Fathers and Sons from Turgenev also, right?

  61. mockturtle said,

    BTW, I did recommend Fathers and Sons from Turgenev also, right?

    No, just The Idiot and Gogol’s Dead Souls which I have but haven’t yet read. I’ll put Turgenev on my list, too! :-) I’ll read reviews to find the best translation.

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