Raising minimum wage? - Page 3 - Tilted Forum Project Discussion Community

Baraka_Guru · 07-30-2008, 06:14 AM

loquitur, I'd like to add to that. I don't think a great number of minimum-wage jobs (or otherwise low-paying jobs) make up a sizeable proportion of the workforce of many large corporations where we'd find these wealthy CEOs. I'm under the impression that many minimum-wage jobs are found in small companies, many of them private. Think small retail, restaurants, etc. If I were working at a large company with a CEO worth millions, I'd expect a bit more than the minimum wage, especially if I were working at corporate head office.

Cynthetiq · 07-30-2008, 07:32 AM

yes but there's a difference between working in the corporate office and then the "front lines" of the company.

There are many of the Fortune 500 that are in the retail sector which a good percentage of the workforce is probably paid minimum wage.

Fortune 500 Companies click to show

Baraka_Guru · 07-30-2008, 07:38 AM

Woah, there's 500 there. Would you pull out some case studies?

Willravel · 07-30-2008, 08:06 AM

Quote:

Originally Posted by loquitur

I still want to see any evidence that workers' salaries are what they are because the CEO is paid too well. You can be unhappy about either of those phenomena, or both, but I still think it's fallacious to say that one caused the other. The market for top executive talent and the market for regular jobs are distinct markets. One can be roaring and the other stagnating without there being any necessary linear causal link between them.

What kind of evidence are you looking for short of a memo that says "Pay the CEO more, and take it out of the salaries of the grunts"? They could easily lie and say that it's coming from elsewhere and that it's just a coincidence that the lower salary workers happen to not get paid much.

It's not going to be linear. It's going to show priority. Let's say a corporation lands record profits one year (enough to invest more in the company AND pay people more) and the CEO and most of the upper management gets decent (4%+) raises and the bottom stays the same or decreases. What does that tell you? It tells you that the priority is to pay the upper management.

Baraka_Guru · 07-30-2008, 08:15 AM

Quote:

Originally Posted by Willravel

It's not going to be linear. It's going to show priority. Let's say a corporation lands record profits one year (enough to invest more in the company AND pay people more) and the CEO and most of the upper management gets decent (4%+) raises and the bottom stays the same or decreases. What does that tell you? It tells you that the priority is to pay the upper management.

I'm wondering if this often happens within the same company. When you start looking at stats that use averages, it's easy to misinterpret what that really means. When companies post record profits, how often does that lead to stagnant pay for employees or pay cuts? You'd think the normal thing would be to reward employees for a good job, or at least to retain their employee talent. Record-breaking profits generally are not sustainable. Smart companies usually look at competitive employee compensation as a way of maintaining stability.

Jinn · 07-30-2008, 08:19 AM

Quote:

Originally Posted by Willravel

What does that tell you? It tells you that the priority is to pay the upper management.

As it should be.

Cynthetiq · 07-30-2008, 08:31 AM

right jinn.... will you can't just interchange upper management and get the same results, you can with the lower skilled workers.

Willravel · 07-30-2008, 08:32 AM

Quote:

Originally Posted by Jinn

As it should be.

It's the sign of bad management and a complete lack of good education. A proper CEO should have education in both mathematical economics and economic game theory.

roachboy · 07-30-2008, 08:35 AM

once upon a time, before unilever bought them out, establishing and maintaining a rational proportion between worker wages and ceo-level salaries wage was an important aspect of how ben and jerry's ran it's business.

when unilever entered the picture, there was a split between the two founders, with ben leaving the game. the main issue was the abandonment of this politics of wages/salaries.

i mention this to indicate what should be self-evident: these relations are choices. the lack of a relation between executive compensation and workers wages is also a choice. it is a political choice--and eminently political choice---based on alot of factors, really--but one of which goes back to a sub-topic raised earlier, which is the conception/imagined mechanism whereby value is created. before unilevel, ben and jerry's operated under the assumption that it's workers created value because they made the product. the product was sent out into the market, the product was purchased blah blah blah. unilever's view is apparently otherwise, that capital creates value. in the first conception, it is the object produced that is the centerpiece of the understanding--the the latter it is the movement of capital.

this is an instructive little story and i'm glad i told it.
there's a ton of information on the web about this, debris from the wider controversy at/around ben and jerry's concerning the buyout. searches find it.

addendum: if you think about it, in the shift from the initial to the present arrangement, working people go from being present to disappearing.
so it is in this debate.

Cynthetiq · 07-30-2008, 08:36 AM

Quote:

Originally Posted by Willravel

It's the sign of bad management and a complete lack of good education. A proper CEO should have education in both mathematical economics and economic game theory.

OMFG, you can't be serious. That's an ignorant statement if I've read any today.

A CEO doesn't need to have that exact skill set. It's not a requirement for the vision. He can surround himself by and executive management team that does understand such things, that is the job of the CFO, who reports to the CEO. It is not the job of the CEO.

Willravel · 07-30-2008, 08:42 AM

Quote:

Originally Posted by Cynthetiq

OMFG, you can't be serious. That's an ignorant statement if I've read any today.

And this is condescending and as we will now see unsupported....

Quote:

Originally Posted by Cynthetiq

A CEO doesn't need to have that exact skill set. It's not a requirement for the vision. He can surround himself by and executive management team that does understand such things, that is the job of the CFO, who reports to the CEO. It is not the job of the CEO.

"Vision"? The CEO and CFO are responsible for making sure the business is successful. That responsibility does not just fall on the shoulders of the CFO. They run the business. Maybe you can explain how a proper "vision" can come from someone who doesn't know the rules of the game? Unless that vision is "make more money" or some other vague idea you can get from a fortune cookie, they need to be able to set realistic goals which can be supported by strong data. And how would you do that? They understand economics, which means understanding economic theory. I don't have my degree in economics, but I would imagine in at least one of those classes they go into at least basic game theory and other mathematical econ.

Cynthetiq · 07-30-2008, 08:53 AM

Quote:

Originally Posted by Willravel

And this is condescending and as we will now see unsupported....

I'm telling you that your opinion isn't based on reality but based on your viewpoint of how things are run, not on any schooling or realworld experience.

Quote:

Originally Posted by Willravel

"Vision"? The CEO and CFO are responsible for making sure the business is successful. That responsibility does not just fall on the shoulders of the CFO. They run the business. Maybe you can explain how a proper "vision" can come from someone who doesn't know the rules of the game? Unless that vision is "make more money" or some other vague idea you can get from a fortune cookie, they need to be able to set realistic goals which can be supported by strong data. And how would you do that? They understand economics, which means understanding economic theory. I don't have my degree in economics, but I would imagine in at least one of those classes they go into at least basic game theory and other mathematical econ.

Yes, your beloved Steve Jobs didn't know the rules of the game when he started. He had the vision of a company and how that company should be run.

CEO that are successful seemingly do set realistic goals and when those goals are not met, are punished by Wall Street. It's a simple thing really. Listen to any shareholder's meeting if you are a stock owner and you'll see and hear how CEOs have realistic and unrealistic goals and vision.

Will, I sit on a one board of directors, and interface directly with one CEO. I'm going to run for a seat on another board later this month if I can find the time.

I also pointed out that out of 500 companies not any are run exactly the same. Each and every one of them has differences and nuances besides market sector and industry. What is the same for all of them is that they are all public companies vying for investor dollars.

roachboy · 07-30-2008, 09:05 AM

Quote:

What is the same for all of them is that they are all public companies vying for investor dollars.

and there's the rub.
there's the point at which the trade-off occurs.

in the early 1970s, television night news would relay one or another statistic concerning GNP as the astrological indicator of the night of overall Well-Being.
around 1972--around the time stock trade was internationalized, around the time bretton woods was abandoned in currency--the astrological Indicator of overall Well-Being became the dow-jones industrial average.

that is another nice little story, one with many potential implications that will no doubt not be discussed.
but i am glad i told it too.

Cynthetiq · 07-30-2008, 09:06 AM

Quote:

Originally Posted by roachboy

once upon a time, before unilever bought them out, establishing and maintaining a rational proportion between worker wages and ceo-level salaries wage was an important aspect of how ben and jerry's ran it's business.

when unilever entered the picture, there was a split between the two founders, with ben leaving the game. the main issue was the abandonment of this politics of wages/salaries.

i mention this to indicate what should be self-evident: these relations are choices. the lack of a relation between executive compensation and workers wages is also a choice. it is a political choice--and eminently political choice---based on alot of factors, really--but one of which goes back to a sub-topic raised earlier, which is the conception/imagined mechanism whereby value is created. before unilevel, ben and jerry's operated under the assumption that it's workers created value because they made the product. the product was sent out into the market, the product was purchased blah blah blah. unilever's view is apparently otherwise, that capital creates value. in the first conception, it is the object produced that is the centerpiece of the understanding--the the latter it is the movement of capital.

this is an instructive little story and i'm glad i told it.
there's a ton of information on the web about this, debris from the wider controversy at/around ben and jerry's concerning the buyout. searches find it.

addendum: if you think about it, in the shift from the initial to the present arrangement, working people go from being present to disappearing.
so it is in this debate.

Yes, this is an important part of business. Some people and companies have a particular ethos and want to stick by that ethos.

Snapple was a small company at one time, when they got bought by Quaker, they lost that image. Recently they brought Wendy back as a spokesperson to try to recaputure that image, but the damage is done and people don't see Snapple as being a small boutique beverage company any longer.

The only way to protect that 100% is to not sell out. Sometimes that is troubling for the partnership or owner who is trapped by their business and workload.

Willravel · 07-30-2008, 09:10 AM

Quote:

Originally Posted by Cynthetiq

I'm telling you that your opinion isn't based on reality but based on your viewpoint of how things are run, not on any schooling or realworld experience.

I've had experience. I had to rush out and learn economics from old textbooks when I was hired in the business world instead of a job that required my education in psychology. Not only that, but when my previous boss was in all of his legal trouble, the VPs had to take over. As VP of marketing and product development, I would be what some might call the "vision" man.

So no, my opinion isn't based on real schooling, but it is based in experience.

Quote:

Originally Posted by Cynthetiq

Yes, your beloved Steve Jobs didn't know the rules of the game when he started. He had the vision of a company and how that company should be run.

Apple was successful because the product was perfect. It sold itself. Do you think Steve Jobs has a formal education in economics now? Of course he does.

Quote:

Originally Posted by Cynthetiq

CEO that are successful seemingly do set realistic goals and when those goals are not met, are punished by Wall Street. It's a simple thing really. Listen to any shareholder's meeting if you are a stock owner and you'll see and hear how CEOs have realistic and unrealistic goals and vision.

Why would a vision fail? Because it's wrong. What's the best way to prevent that? Know the rules of the game.

How many CEOs don't have a formal education in economics?

roachboy · 07-30-2008, 09:28 AM

the problem may be one of scale, then?
once you go public, once your production capacity gets large enough to require the issuance of stock in order to finance aspects of operations, you make the fatal compromise?
from that point on, any idea that working people create value and by extension wealth gets erased?

it's still a political choice, how one views production.

Cynthetiq · 07-30-2008, 09:31 AM

Quote:

Originally Posted by Willravel

I've had experience. I had to rush out and learn economics from old textbooks when I was hired in the business world instead of a job that required my education in psychology. Not only that, but when my previous boss was in all of his legal trouble, the VPs had to take over. As VP of marketing and product development, I would be what some might call the "vision" man.

So no, my opinion isn't based on real schooling, but it is based in experience.

Apple was successful because the product was perfect. It sold itself. Do you think Steve Jobs has a formal education in economics now? Of course he does.

Why would a vision fail? Because it's wrong. What's the best way to prevent that? Know the rules of the game.

How many CEOs don't have a formal education in economics?

For a small company? or are you talking about a company with > 500employees? Annual revenues of >$10M? How about this... a publically traded company on any of the international markets?

See when I work for a small company I can call myself anything I'd like because it doesn't change the bottom line all that much.

If you'd like to talk small potatoes, we can talk small potatoes, but what I believe we are talking about is big business large publically traded companies on NYSE, NASDAQ, AMEX, FTSE, etc.

But since you seem stuck on the requirement of formal education as a criterion for succesful CEOs and successful companies...

Bill Gates, Paul Allen, Larry Ellison, Dhirubhai Ambani, Steve Jobs, Michael Dell, Ray Kroc, Andrew Carnegie, Henry Ford, Kirk Kerkorian, and Richard Branson all started companies that have a lasting impression on today's market place. None of them had any formal education to back up their vision.

Again, you get to pick who you want to invest in based on the management team and the peformance of the company.

Investors vote for companies with their dollars.
-----Added 30/7/2008 at 01 : 33 : 28-----

Quote:

Originally Posted by roachboy

the problem may be one of scale, then?
once you go public, once your production capacity gets large enough to require the issuance of stock in order to finance aspects of operations, you make the fatal compromise?
from that point on, any idea that working people create value and by extension wealth gets erased?

it's still a political choice, how one views production.

Maybe, Whole Foods has it as part of their mission statement as to how they will operate.

Whole Foods Market : Company : Declaration of Interdependence

That's an attraction for some investors as the stock has done very well in the past decade.
-----Added 30/7/2008 at 01 : 36 : 50-----
here it is...

Quote:

There is a community of self interest among all of our stakeholders. We share together in our collective vision for the company. To that end we have a salary cap that limits the maximum cash compensation (wages plus profit incentive bonuses) paid to any Team Member in the calendar year to 19 times the company-wide annual average salary of all full-time Team Members.

I also thought there was a cap on the CEO something like 48x the lowest salary...

Willravel · 07-30-2008, 09:45 AM

Quote:

Originally Posted by Cynthetiq

For a small company? or are you talking about a company with > 500employees? Annual revenues of >$10M? How about this... a publically traded company on any of the international markets?

Less than 500, a little less than $10m, and not publicly traded, but it was still a business and I still had to understand economics to try and run it. Here's a question, if only running a small buisness requires a decent understanding of econ, why would running a gigantic corporation not require such an understanding?

Quote:

Originally Posted by Cynthetiq

Bill Gates, Paul Allen, Larry Ellison, Dhirubhai Ambani, Steve Jobs, Michael Dell, Ray Kroc, Andrew Carnegie, Henry Ford, Kirk Kerkorian, and Richard Branson all started companies that have a lasting impression on today's market place. None of them had any formal education to back up their vision.

Gates was Harvard Educated in business back in 1973, alongside Paul Allen. Larry Ellison attended 2 years at University of Illinois and went to U of Chicago. His wiki doesn't say it, but he also went back to school. Most of them had at least some decent college level education, and it seems that all of them now have their degrees. Why would they go back if they didn't think they needed them?

Cynthetiq · 07-30-2008, 09:57 AM

Quote:

Originally Posted by Willravel

Less than 500, a little less than $10m, and not publicly traded, but it was still a business and I still had to understand economics to try and run it. Here's a question, if only running a small buisness requires a decent understanding of econ, why would running a gigantic corporation not require such an understanding?

Because there isn't a prerequisite for it. You can think it is a good quality, but there's no exact formula to how profitable a business is based on education. That's one of the things that makes America an coveted destination because even a common person making chocolate chip cookies can make a worldwide business.

Quote:

Gates was Harvard Educated in business back in 1973, alongside Paul Allen. Larry Ellison attended 2 years at University of Illinois and went to U of Chicago. His wiki doesn't say it, but he also went back to school. Most of them had at least some decent college level education, and it seems that all of them now have their degrees. Why would they go back if they didn't think they needed them?

Because investors like to see pedigrees on the management teams. It is a solidly known fact amongst investors that look at the prospectus and 10k sheets to see just who the management team is. They don't like to see blanks for education.

Going to college and not completing it is consided not having a formal education. If you don't subscribe to that as the definition you are alone in that. Going to NYU for continuing education classes or non-matriculated attendance does not equal graduating from NYU. It is "taking classes."

Jinn · 07-30-2008, 10:03 AM

Put simply, you should be paid relative to the power you have to cause the company to make or lose money. A floor worker has almost no power to make a company succeed or fail. The floor worker's manager has more power, because he controls a number of employees. The manager's manger has even more power, etc, etc, ad nauseum. If what you say or do can cause the company to experience dramatic shifts in revenue or image, you should be paid for that responsibility. I'm not going to represent an entire company as a CEO without the money that should come with that responsibility. If the company goes down, its MY fault.. not Mr. Floor worker.

You seem to have veered away in your argument of semantics and "experience in the industry" with Cyn, but I still don't see how you believe that

Quote:

Originally Posted by willravel

... the priority is to pay the upper management.

is..

Quote:

Originally Posted by willravel

... the sign of bad management and a complete lack of good education. A proper CEO should have education in both mathematical economics and economic game theory.

"Economic game theory"? Really? It's pretty simple to understand that you should be paid more the higher your position within a company. It is harder to replace upper management than middle management, harder to replace middle management than hourly employees. Likewise, you should always put "priority" towards paying the upper management.

Willravel · 07-30-2008, 10:04 AM

Quote:

Originally Posted by Cynthetiq

Because there isn't a prerequisite for it. You can think it is a good quality, but there's no exact formula to how profitable a business is based on education. That's one of the things that makes America an coveted destination because even a common person making chocolate chip cookies can make a worldwide business.

There's no exact formula, but imagine trying to design a boat without an understanding of fluid dynamics. They help give you an idea about what might work. Can you imagine being the head of a corporation and not understanding the theories behind something as simple as supply and demand? It would make the job of creating a vision for the company nearly impossible.

Quote:

Originally Posted by Cynthetiq

Because investors like to see pedigrees on the management teams. It is a solidly known fact amongst investors that look at the prospectus and 10k sheets to see just who the management team is. They don't like to see blanks for education.

Sure, some idiot investors might want to see "pedigree" (which isn't quantifiable), but seeing that the person you're trusting with your investment has a solid understanding of business and economics has to instill some level of confidence. That's all beside the point, though. This is about education being applied to work which makes one more likely to succeed.

Quote:

Originally Posted by Cynthetiq

Going to college and not completing it is consided not having a formal education. If you don't subscribe to that as the definition you are alone in that. Going to NYU for continuing education classes or non-matriculated attendance does not equal graduating from NYU. It is "taking classes."

That's irrelevant. If one is successful and understands mathematical economics, whether or not one has a diploma, they are supporting my position.

Cynthetiq · 07-30-2008, 10:09 AM

Quote:

Originally Posted by Willravel

There's no exact formula, but imagine trying to design a boat without an understanding of fluid dynamics. They help give you an idea about what might work. Can you imagine being the head of a corporation and not understanding the theories behind something as simple as supply and demand? It would make the job of creating a vision for the company nearly impossible.

Sure, some idiot investors might want to see "pedigree" (which isn't quantifiable), but seeing that the person you're trusting with your investment has a solid understanding of business and economics has to instill some level of confidence. That's all beside the point, though. This is about education being applied to work which makes one more likely to succeed.

That's irrelevant. If one is successful and understands mathematical economics, whether or not one has a diploma, they are supporting my position.

I'd state that higher education facilities can quatify that. They tout how many of their graduates land at Fortune 500s. They actively ask exectuve management alumni to speak at the schools. There is very much a quantifiable measurement by the schools. It is one of the reasons why Ivy League graduates tend to have more CEOs across the board. I don't have time for a link at the moment.

Willravel · 07-30-2008, 10:19 AM

I'm saying pedigree isn't quantifiable. I am mainly saying that being educated in economics is important in running a company, whether that means CEO or CFO.

Cynthetiq · 07-30-2008, 10:25 AM

Quote:

Originally Posted by Willravel

I'm saying pedigree isn't quantifiable. I am mainly saying that being educated in economics is important in running a company, whether that means CEO or CFO.

which is neither here nor there, since big titted secretaries can also be a factor in the performance and bottom line of a company.

again, we may want it to be a particular way but it doesn't mean that it actually works that way.

jorgelito · 07-30-2008, 11:32 AM

Quote:

Originally Posted by Jinn

Put simply, you should be paid relative to the power you have to cause the company to make or lose money. A floor worker has almost no power to make a company succeed or fail. The floor worker's manager has more power, because he controls a number of employees. The manager's manger has even more power, etc, etc, ad nauseum. If what you say or do can cause the company to experience dramatic shifts in revenue or image, you should be paid for that responsibility. I'm not going to represent an entire company as a CEO without the money that should come with that responsibility. If the company goes down, its MY fault.. not Mr. Floor worker.

You seem to have veered away in your argument of semantics and "experience in the industry" with Cyn, but I still don't see how you believe that

is..

"Economic game theory"? Really? It's pretty simple to understand that you should be paid more the higher your position within a company. It is harder to replace upper management than middle management, harder to replace middle management than hourly employees. Likewise, you should always put "priority" towards paying the upper management.

Good post Jinn, a nice summary.

Add Richard Branson to the uneducated ranks. The Body Shop lady too.

roachboy · 07-30-2008, 12:19 PM

it's not so simple---there's an *enormous* body of information in sociology that indicates management hierarchies have little to do with the effective running of production---they're as much expressions of the ideology of organization, the type of organization assumed to be more effective---but it's not at all clear that vertically ordered hierarchies (bureaucracies) are even rational (from the viewpoint of effectively running an operation that is not itself---most organizations can run themselves----not necessarily well---but anyway)---even as they are rational internally---rational here meaning that they are effective systems of information fragmentation and transfer---within a bureaucracy, professional roles are defined such that the bits of information you recieve, process, and send along are internally consistent--they "fit"---but that doesn't mean there's a coherent relation between that information and the world.

but it sometimes appears that in this brave new world of neoliberalism, concern about such matters has been erased behind a quaint almost religious faith that everything fits with everything else, so a corporate bureaucracy is rational because it's private and only state bureaucracies are subject to the structural problems of bureaucracy in general because, well, the public sector (the state) is evil foul bad and nice corporations are entirely rational.

it's quaint.

loquitur · 07-30-2008, 01:48 PM

Actually, Roachboy, it's less a political decision than a legal one. The Ben & Jerry's case that you raised is instructive. When Cohen and Greenberg were the private owners of the company, they had the choice to run the place as they liked. They could make hiring decisions, firing decisions, bonus decisions, raise decisions, acquisitions, divestittures, relcoation - you name it - precisely as they liked, because they owned the business and they didn't have anyone to answer to except themselves. If they felt it was important to keep their own comp down relative to those lower in the hierarchy, that was their choice. I'm sure the business benefitted from it in some way, or they did. Even if not, it was their buisness, they could make that choice.

Once you have public shareholders the calculus is very different. The board and officers are fiduciaries, which means their legal obligation is to act in the best interests of shareholders. There is a huge amount of literature about the degree (if any) to which corporate boards are required to account for other constituencies such as employees or the local community, and as it shakes out legally, they can account for those other constituencies if there is a corporate benefit that ultimately inures to the shareholders - call it enlightened self-interest.

Bear in mind that the typical shareholder is not a plutocrat. The typical shareholder is a pension fund. It has its own fiduciary obligations and its own funding targets. It has to get returns because retirees are depending on it. There are lots of other categories of shareholders, but if you drill down through the shareholder body, what you'll find as the common denominator is that they all want to or need to maximize returns (within the bounds of the law and ethics, of course). No corporate board has the right to ignore that, either legally or morally. If you want I can point you to some literature about why it makes economic sense to do this.

The bottom line is that the market for executive talent will dictate what executives are paid, and the market for other niches of talent will dictate what people in that niche are paid. Private companies will do as they please. Public companies cna't and won't. The money to pay execs isn't coming out of employees' pockets - it's coming out of shareholders' pockets.

And yes, there will always be some abusers - those people, like Dennis Kozlowski or Andy Fastow, should go to jail and be fined, big time.

Cynthetiq · 07-30-2008, 01:51 PM

thanks loquitur again, you state so elloquently what takes me many many posts to try to get across and only a small percentage of what I'm trying to say gets across.

I guess that's why you're in legal and I'm not

roachboy · 07-30-2008, 02:06 PM

interesting, loquitor---but i don't think it's that straightforward---for example there's a movement (kinda) to force corporations to shift from generating reports (annual reports for example) framed around shareholders and to replace that with the broader category of stakeholders. the driver is corporate social responsibility audits (regardless of they end up being functionally) and the goal of this is to pressure corporations to reframe annual report data around stakeholders as a way of forcing corporations to integrate impact assessments with financial reporting.

the point of mentioning that is mostly that the way annual reports are framed is a political choice in itself--and it's obviously a political matter to the extent that, say, questions regarding workers are reduced to a variable cost reported only in terms of its impact on shareholder profits.

the legal framework is interesting in that a miltonfreidman view of corporate activity would say that what's legal is what's ethical--and so from that viewpoint, the meaning of the legal relation that you spell out would be as you say it is---but it's increasingly clear that this no longer flies for alot of corporations and that they're being forced to rethink how the present themselves to themselves. which includes how they present themselves to shareholders.

you could also say that during the period from 1945-1970 (to pick an end date at random) what you outline was also the case, but the political situation was such that it was not acceptable for a corporation to only view its workforce in terms of it;s impact on shareholder profits--because in manufacturing (for example, because it fits) there was a quite strong union presence and institutions like collective bargaining were in place and the combined effect of the two was to force a much wider political framework into place that prevented workers being reduced conceptually to a drag on investor profits.

so what you describe is an expression of the political climate that's been dominant since the 1980s, really--which is holds that the legal relationship and the ethical relationship and the political situation are more or less the same. (in that the legal requirements and the political expression of what a corporation should do are close to identical).

this is the political context that's enabled the massive transfer of manufacturing jobs out of the united states, for example. you can't argue it's not a politics.

of course, at issue here, as it often turns out, is what information is and is not included in the debate. but i figure that since this started off as a debate about minimum wage levels, it's kinda interesting to find so many posts about ceo compensation in the same thread. i take that as a sign of the times.

loquitur · 07-30-2008, 07:07 PM

actually, that's not quite accurate.

There have been movements to pry open the corporate machinery for pretty much as long as I have been alive. A lot of people who would like corps to act in the way they want corps to act have the fairly standard illusion that their own views are so reasonable that, if only the bad people in charge could be bypassed, the other people - here, shareholders - would go along with them.

It ain't so. Shareholders expect accountability from management. They own the company and they expect returns. The model of how the legal relations work has always been that way; what has changed in the last 30 years is, in the main, the degree of accountability and the mechanics for it. The biggest shareholders are now institutions, with their own clout and the ability to force management to pay attention to them.

At the risk of seeming hostal, let me quote some things for you that will give you an idea of why that not only is so but why it should be so and why it is a good thing that it is so. Compelling corps to account for nonshareholder constituencies erodes the premise for having corporations to begin with (which is to mobilize and aggregate resources for economic purposes).

First, Larry Summers:

Quote:

Inherent in the multiple objectives urged for creative capitalists is a loss of accountability with respect to performance. The sense that the mission is virtuous is always a great club for beating down skeptics. When institutions have special responsibilities it is necessary that they be supported in competition to the detriment of market efficiency.

It is hard in this world to do well. It is hard to do good. When I hear a claim that an institution is going to do both, I reach for my wallet. You should too.

He was talking about Fannie Mae and Freddie Mac, but they are a paradigm of what a corporation with goals other than maximizing profit would look like. Here is more of his explanation:

Quote:

How about chartering private companies as government sponsored enterprises with the mission of promoting home ownership affordability? Give them boards with some private representatives and some public representatives. Make clear that government stands behind their capital market innovations so they can borrow more cheaply and pass the savings on. Exempt them from the state local taxes that others pay. Give them specific objectives on affordability that they must meet. Rely on a special government regulator to assure that they balance their social responsibility with their drive to profit. Harness the profit motive to meet a social objective.

This is roughly the rationale behind Fannie Mae and Freddie Mac. I would submit that it is about as good or as bad as most creative capitalism ideas involving joint profit making and social objectives. But one hopes that we are now witnessing the end of this particular experiment in creative capitalism: the government is moving to pick up the pieces of the mess the GSEs have made and their shareholders are losing most of their money. (emphasis mine)

OK, that's one explanation. Here's another. I forget where I saw it, probably on Stephen Bainbridge's "Law and Business" blog (he's a law prof at UCLA, and it was via his blog that I found the Summers quote above). Shareholders pay for their shares (in theory, and over the long run in practice too) an amount that, in the market, is the discounted present value of the expected future cash flows of the company (discounted for time, risk and uncertainty). By introducing the interests of other constituencies into the corporation's decisionmaking, it increases the risk or uncertainty for the shareholders because the number of factors in the decision multiplies exponentially. What that means is that the shareholders will require greater returns for their investment in order to compensate them for the additional risk. That raises teh cost of capital to the company. By making capital more expensive, we depress growth rates and hinder economic growth. We also inhibit risk taking because there is already some additional risk built into the very fabric of the entreprise, which means that each additional quantum of risk is more costly.

In other words, forcing the corporation to include the interests of nonshareholder constituencies in its decisionmaking will have the effect of hurting those very consituencies, because it hamstrings the corporation as an economic entity. The shareholders are flexible and can put their money elsewhere but the employees and neighbors can't do that. They are best served by having a healthy prosperous company that can pay good salaries and keep its streetfront clean - and, not incidentally, purchase goodwill by contributing to the local PAL or YMCA, or sponsoring the PBS show.

Am I being clear? or is my barrister's opacity coming through?
-----Added 30/7/2008 at 11 : 16 : 31-----
Oh yes, and there is another consideration as well, this one also in Bainbridge:

Quote:

This then is the major failing of the Bishops’ support for a multi-constituency conception of corporate directors’ duties. “Any social order that intends to endure must be based on a certain realism about human beings and, therefore, on a theory of sin and a praxis for dealing with it.” Here, the sin in question is that of self-interest. While the Bishops’ proposal would empower honest directors to act in the best interests of all the corporation’s constituents, it also would empower dishonest directors to pursue their own self-interest. There is a very real risk that directors and managers given discretion to consider interests other than shareholder wealth maximization will use stakeholder interests as a cloak for actions taken to advance their own selfish interests.

In other words, increasing the number of consituencies increases the opportunities for corruption. (This is standard libertarian argument, by the way - as you can see, it applies to all kinds of authority structures, not just government.)

girldetective · 07-31-2008, 08:58 AM

I have come back to this thread again and again. I have come armed with postings but found that my thoughts are already here, usually empathetic with the roachboy. Last night I constructed a post and lost it when my internet went off.

This thread is filled with facts, opinions, litanies, and emotions, all very well spelled out and catagorized. However, it remains that there are many people who have great great great sums of money and holdings, and many more people who are struggling. There is something very wrong and of course it is distribution. This is true.

Cynthetiq · 07-31-2008, 09:23 AM

Quote:

Originally Posted by girldetective

I have come back to this thread again and again. I have come armed with postings but found that my thoughts are already here, usually empathetic with the roachboy. Last night I constructed a post and lost it when my internet went off.

This thread is filled with facts, opinions, litanies, and emotions, all very well spelled out and catagorized. However, it remains that there are many people who have great great great sums of money and holdings, and many more people who are struggling. There is something very wrong and of course it is distribution. This is true.

It is? How so?

When an immigrant with a few dollars in their pocket can come to this country and work and somehow build up enough money to "make it" according to others, how is it wrong and about how distribution is wrong?

When an illegal immigrant comes here with nothing in their pocket and has a better lifestyle here than in their home country how is distribution broken?

It is simple fact of spending less than you earn. More often than not people aren't interested in living a meager lifestyle in return for the future financial security. Instead they blame it on the system.

Baraka_Guru · 07-31-2008, 09:27 AM

Quote:

Originally Posted by Cynthetiq

It is simple fact of spending less than you earn. More often than not people aren't interested in living a meager lifestyle in return for the future financial security. Instead they blame it on the system.

What about the many people who live a meager lifestyle and don't have future financial security?

girldetective has a point.

Your immigrant example is the exception, not the rule.

Poppinjay · 07-31-2008, 09:37 AM

I think you could argue that distribution is broken because so much personal wealth is locked up in assets and savings.

Yes, you should spend less than you earn, but you should also not treat life like it's a monopoly game. He who dies with the most toys does not win, and their progeny usually end up as spoiled under-achievers.

As far as immigrants achieving, yes, if you have desire and drive, you will achieve. This country has enough slackers so that there's achievement available for anybody who wants it. My two most successful friends from college were brothers who grew up in a squatter's row house. Coming from no or little means can really inspire people to achieve, as long as they also have the character needed for the task.

The problem is, the corporations of this country have proven that they would be more than happy to employ 8 year olds, sell bad milk, create exploding cars etc. in order to save a buck. That's why we have laws and regulations. The minimum wage has been criminally low for too long. Every time this comes up, we hear about how business knows what's good for business, and how chaos will reign if we raise it.

The anarchy hasn't happened yet.

roachboy · 07-31-2008, 09:39 AM

loquitor: interesting---i don't have time to spell this out more at the moment, so i'll just outline a couple counter-arguments.

a. for a corporation to operate at all it has to take account of its impact on its surroundings. one explanation for attempts to change reporting processes is that an emphasis on shareholder returns in reporting has demonstrated itself to not be adequate.
from a shareholder viewpoint, not only financial but brand considerations could very easily lead one to think that more comprehensive information, based on a wider range of inputs, provides more comprehensive information about corporate performance and so results in better business decisions. potentially.
underneath this, there's no reason to assume, as a freidman type might, that rational action only happens when one's money is on the line. nor is the flipside claim, that anything except profit generation runs beyond the competences of investors, a coherent viewpoint.

b. the argument that more inputs from more people opens up possibilities for more corruption is strange--it seems like an argument against public offerings of stock as much as one against a shift into stakeholder-based reporting.

by the way, notice how working people disappear again?
why is that?

loquitur · 07-31-2008, 10:02 AM

RB, the argument I'm making is that shareholder interest, properly understood, includes considerations of other constituencies because such consideration is in shareholder interests. It's similar to what I wrote elsewhere about my law firm treating its employees well - we do that because it's in our interest to do that. That breaks down if you say that other constituencies have a claim that trumps the interests of shareholders.

The corruption argument is simple: when the goals of the company are simple and discrete, the grounds on which decisions can be justified are far fewer, and there are fewer opportunities for manipulation of the machinery in favor of the decisionmakers and at the expense of the beneficiaries. The more goals there and the more interests to serve, the more opportunity there is for cloaking self-interested decisions, and the more opportunities there are for corruption. Try to imagine the type of lobbying that goes on in state legislatures, and transpose that to the corporate boardroom. That's what I"m getting at.

boink · 07-31-2008, 11:53 AM

Quote:

ALL labor is replaceable. Even cheap Mexican labor...

this statement is pretty choice. labour class is equal to cattle or a pile of coal you can shovel into your locomotive. "even cheap Mexican labour " ?? wtf is that ? is a Mexican usually assumed to be worth less than other humans ? or is it management incapable to direct them in a way that get's the most value from them ?

Quote:

you can't just interchange upper management and get the same results, you can with the lower skilled workers.

doesn't this suggest that labour is NOT replaceable ? that maybe the skills of the hands have value ? that what is learned in the school of hard knocks is valuable ?

roachboy · 07-31-2008, 12:08 PM

the deskilling of labor is one of the main processes that define capitalist organization. so in the context of capitalism, working people are interchangeable--it's one of the many dehumanizing features of this type of organization of production. deskilling also extends--and increasingly so---into "management"--with computers functioning as a prime enabling device. you could say that deskilling is generalized in the context of large-scale capitalist organizations. to switch rhetorical registers for a sec, that's why it's as fucked up as it is in so many ways.

of course if you want to see in this form of organization some type of mirror of an image you have of natural hierarchy, you'll be inclined to substitute dream-imagery for the effects of this organization and will see in the abstract image "manager" someone who retains a coherent skill set.

in some regions within a given economic sector (those related to software development, say) folk do operate with a discrete skill set on a more-or-less craft basis: but these are exceptions.

it turns out that folk who occupy such positions tend to imagine the entire world in the image of themselves, projecting it laterally to fashion a sense of social distinction, above to project some imaginary ladder they aspire to climb, and below to create a sense of social distance from the lesser beings below. but this is a psychological positioning, not a description of the capitalist order.

maybe that's why working folk who try to get by on minimum wage keep disappearing from this thread even---we are communicating across a medium access to which is class specific to a great extent and so it is a theater of class or status performance and for the performance of status anxieties at the same time.

the cynicism hasn't started yet, btw---it starts when you move from the above to thinking about motives for keeping wages low in these imaginary worlds animated by status anxiety.....no reason to go there when you can do it for yourself.

girldetective · 07-31-2008, 12:16 PM

Quote:

robot parade said : Think of minimum wage as a giant union covering *everyone* in the US. We've collectively decided that the least amount that's acceptable to pay (most) workers is this minimum wage, and our representatives have implemented that policy.

This is interesting. I pay my dues (taxes) and I vote for my leaders. However, there has been no referendum re minimum wage put forth that I have seen. I wonder what would happen if there was and the populace was educated in the aspects of capitalism, moral/social responsibility, and the effects of miminimum wage?

Quote:

roachboy asked : by the way, notice how working people disappear again?
why is that?

Yes.
Why is that?

I have some ideas.

loquitur · 07-31-2008, 01:28 PM

RB, that's just wrong. The story of increasing productivity (which is pretty much an imperative in capitalism) is the story of increasing specialization - which in turn means nonfungibility of labor. Unskilled labor commands low wages for a reason, precisely because the lower the skill level the greater the fungibility.

07-30-2008, 06:14 AM	#81 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	loquitur, I'd like to add to that. I don't think a great number of minimum-wage jobs (or otherwise low-paying jobs) make up a sizeable proportion of the workforce of many large corporations where we'd find these wealthy CEOs. I'm under the impression that many minimum-wage jobs are found in small companies, many of them private. Think small retail, restaurants, etc. If I were working at a large company with a CEO worth millions, I'd expect a bit more than the minimum wage, especially if I were working at corporate head office. __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot

07-30-2008, 07:32 AM	#82 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	yes but there's a difference between working in the corporate office and then the "front lines" of the company. There are many of the Fortune 500 that are in the retail sector which a good percentage of the workforce is probably paid minimum wage. Fortune 500 Companies click to show 3M Company Abbott Laboratories ADM Advance Auto Parts, Inc. Advanced Micro Devices, Inc. Aetna Inc. Affiliated Computer Services, Inc. Aflac Incorporated AGCO Corporation Agilent Technologies, Inc. Air Products and Chemicals, Inc. AK Steel Holding Corporation Albertson's, Inc. Alcoa Inc. Allied Waste Industries, Inc. ALLTEL Corporation Altria Group, Inc. Amazon.com, Inc. Ameren Corporation American Electric Power Company, Inc. American Express Company American Family Insurance Group American Financial Group, Inc. American International Group, Inc. American Standard Companies Inc. AmerisourceBergen Corporation Amgen Inc. 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Wal-Mart Stores, Inc. Washington Mutual, Inc. Waste Management, Inc. WellPoint, Inc. Wells Fargo & Company WESCO International, Inc. Western & Southern Financial Group Weyerhaeuser Company Whirlpool Corporation Whole Foods Market, Inc. Winn-Dixie Stores, Inc. Wm. Wrigley Jr. Company World Fuel Services Corporation WPS Resources Corporation Wyeth Xcel Energy Inc. Xerox Corporation Yahoo! Inc. YRC Worldwide Inc. YUM! Brands, Inc. __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

07-30-2008, 07:38 AM	#83 (permalink)
Baraka_Guru warrior bodhisattva Super Moderator Location: East-central Canada	Woah, there's 500 there. Would you pull out some case studies? __________________ Knowing that death is certain and that the time of death is uncertain, what's the most important thing? —Bhikkhuni Pema Chödrön Humankind cannot bear very much reality. —From "Burnt Norton," Four Quartets (1936), T. S. Eliot

07-30-2008, 08:31 AM	#87 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	right jinn.... will you can't just interchange upper management and get the same results, you can with the lower skilled workers. __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

07-30-2008, 08:35 AM	#89 (permalink)
roachboy Super Moderator Location: essex ma	once upon a time, before unilever bought them out, establishing and maintaining a rational proportion between worker wages and ceo-level salaries wage was an important aspect of how ben and jerry's ran it's business. when unilever entered the picture, there was a split between the two founders, with ben leaving the game. the main issue was the abandonment of this politics of wages/salaries. i mention this to indicate what should be self-evident: these relations are choices. the lack of a relation between executive compensation and workers wages is also a choice. it is a political choice--and eminently political choice---based on alot of factors, really--but one of which goes back to a sub-topic raised earlier, which is the conception/imagined mechanism whereby value is created. before unilevel, ben and jerry's operated under the assumption that it's workers created value because they made the product. the product was sent out into the market, the product was purchased blah blah blah. unilever's view is apparently otherwise, that capital creates value. in the first conception, it is the object produced that is the centerpiece of the understanding--the the latter it is the movement of capital. this is an instructive little story and i'm glad i told it. there's a ton of information on the web about this, debris from the wider controversy at/around ben and jerry's concerning the buyout. searches find it. addendum: if you think about it, in the shift from the initial to the present arrangement, working people go from being present to disappearing. so it is in this debate. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

07-30-2008, 09:28 AM	#96 (permalink)
roachboy Super Moderator Location: essex ma	the problem may be one of scale, then? once you go public, once your production capacity gets large enough to require the issuance of stock in order to finance aspects of operations, you make the fatal compromise? from that point on, any idea that working people create value and by extension wealth gets erased? it's still a political choice, how one views production. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

07-30-2008, 10:19 AM	#103 (permalink)
Willravel ... a sort of licensed troubleshooter.	I'm saying pedigree isn't quantifiable. I am mainly saying that being educated in economics is important in running a company, whether that means CEO or CFO.

07-30-2008, 12:19 PM	#106 (permalink)
roachboy Super Moderator Location: essex ma	it's not so simple---there's an enormous body of information in sociology that indicates management hierarchies have little to do with the effective running of production---they're as much expressions of the ideology of organization, the type of organization assumed to be more effective---but it's not at all clear that vertically ordered hierarchies (bureaucracies) are even rational (from the viewpoint of effectively running an operation that is not itself---most organizations can run themselves----not necessarily well---but anyway)---even as they are rational internally---rational here meaning that they are effective systems of information fragmentation and transfer---within a bureaucracy, professional roles are defined such that the bits of information you recieve, process, and send along are internally consistent--they "fit"---but that doesn't mean there's a coherent relation between that information and the world. but it sometimes appears that in this brave new world of neoliberalism, concern about such matters has been erased behind a quaint almost religious faith that everything fits with everything else, so a corporate bureaucracy is rational because it's private and only state bureaucracies are subject to the structural problems of bureaucracy in general because, well, the public sector (the state) is evil foul bad and nice corporations are entirely rational. it's quaint. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

07-30-2008, 01:48 PM	#107 (permalink)
loquitur Junkie Location: NYC	Actually, Roachboy, it's less a political decision than a legal one. The Ben & Jerry's case that you raised is instructive. When Cohen and Greenberg were the private owners of the company, they had the choice to run the place as they liked. They could make hiring decisions, firing decisions, bonus decisions, raise decisions, acquisitions, divestittures, relcoation - you name it - precisely as they liked, because they owned the business and they didn't have anyone to answer to except themselves. If they felt it was important to keep their own comp down relative to those lower in the hierarchy, that was their choice. I'm sure the business benefitted from it in some way, or they did. Even if not, it was their buisness, they could make that choice. Once you have public shareholders the calculus is very different. The board and officers are fiduciaries, which means their legal obligation is to act in the best interests of shareholders. There is a huge amount of literature about the degree (if any) to which corporate boards are required to account for other constituencies such as employees or the local community, and as it shakes out legally, they can account for those other constituencies if there is a corporate benefit that ultimately inures to the shareholders - call it enlightened self-interest. Bear in mind that the typical shareholder is not a plutocrat. The typical shareholder is a pension fund. It has its own fiduciary obligations and its own funding targets. It has to get returns because retirees are depending on it. There are lots of other categories of shareholders, but if you drill down through the shareholder body, what you'll find as the common denominator is that they all want to or need to maximize returns (within the bounds of the law and ethics, of course). No corporate board has the right to ignore that, either legally or morally. If you want I can point you to some literature about why it makes economic sense to do this. The bottom line is that the market for executive talent will dictate what executives are paid, and the market for other niches of talent will dictate what people in that niche are paid. Private companies will do as they please. Public companies cna't and won't. The money to pay execs isn't coming out of employees' pockets - it's coming out of shareholders' pockets. And yes, there will always be some abusers - those people, like Dennis Kozlowski or Andy Fastow, should go to jail and be fined, big time.

07-30-2008, 01:51 PM	#108 (permalink)
Cynthetiq Tilted Cat Head Administrator Location: Manhattan, NY	thanks loquitur again, you state so elloquently what takes me many many posts to try to get across and only a small percentage of what I'm trying to say gets across. I guess that's why you're in legal and I'm not __________________ I don't care if you are black, white, purple, green, Chinese, Japanese, Korean, hippie, cop, bum, admin, user, English, Irish, French, Catholic, Protestant, Jewish, Buddhist, Muslim, indian, cowboy, tall, short, fat, skinny, emo, punk, mod, rocker, straight, gay, lesbian, jock, nerd, geek, Democrat, Republican, Libertarian, Independent, driver, pedestrian, or bicyclist, either you're an asshole or you're not. What's the best nation in the world? DO-NATION!

07-30-2008, 02:06 PM	#109 (permalink)
roachboy Super Moderator Location: essex ma	interesting, loquitor---but i don't think it's that straightforward---for example there's a movement (kinda) to force corporations to shift from generating reports (annual reports for example) framed around shareholders and to replace that with the broader category of stakeholders. the driver is corporate social responsibility audits (regardless of they end up being functionally) and the goal of this is to pressure corporations to reframe annual report data around stakeholders as a way of forcing corporations to integrate impact assessments with financial reporting. the point of mentioning that is mostly that the way annual reports are framed is a political choice in itself--and it's obviously a political matter to the extent that, say, questions regarding workers are reduced to a variable cost reported only in terms of its impact on shareholder profits. the legal framework is interesting in that a miltonfreidman view of corporate activity would say that what's legal is what's ethical--and so from that viewpoint, the meaning of the legal relation that you spell out would be as you say it is---but it's increasingly clear that this no longer flies for alot of corporations and that they're being forced to rethink how the present themselves to themselves. which includes how they present themselves to shareholders. you could also say that during the period from 1945-1970 (to pick an end date at random) what you outline was also the case, but the political situation was such that it was not acceptable for a corporation to only view its workforce in terms of it;s impact on shareholder profits--because in manufacturing (for example, because it fits) there was a quite strong union presence and institutions like collective bargaining were in place and the combined effect of the two was to force a much wider political framework into place that prevented workers being reduced conceptually to a drag on investor profits. so what you describe is an expression of the political climate that's been dominant since the 1980s, really--which is holds that the legal relationship and the ethical relationship and the political situation are more or less the same. (in that the legal requirements and the political expression of what a corporation should do are close to identical). this is the political context that's enabled the massive transfer of manufacturing jobs out of the united states, for example. you can't argue it's not a politics. of course, at issue here, as it often turns out, is what information is and is not included in the debate. but i figure that since this started off as a debate about minimum wage levels, it's kinda interesting to find so many posts about ceo compensation in the same thread. i take that as a sign of the times. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

07-31-2008, 08:58 AM	#111 (permalink)
girldetective sufferable	I have come back to this thread again and again. I have come armed with postings but found that my thoughts are already here, usually empathetic with the roachboy. Last night I constructed a post and lost it when my internet went off. This thread is filled with facts, opinions, litanies, and emotions, all very well spelled out and catagorized. However, it remains that there are many people who have great great great sums of money and holdings, and many more people who are struggling. There is something very wrong and of course it is distribution. This is true. __________________ As far as possible, without surrender, be on good terms with all persons...be cheerful; strive for happiness - Desiderata Last edited by girldetective; 07-31-2008 at 09:03 AM..

07-31-2008, 09:37 AM	#114 (permalink)
Poppinjay You had me at hello Location: DC/Coastal VA	I think you could argue that distribution is broken because so much personal wealth is locked up in assets and savings. Yes, you should spend less than you earn, but you should also not treat life like it's a monopoly game. He who dies with the most toys does not win, and their progeny usually end up as spoiled under-achievers. As far as immigrants achieving, yes, if you have desire and drive, you will achieve. This country has enough slackers so that there's achievement available for anybody who wants it. My two most successful friends from college were brothers who grew up in a squatter's row house. Coming from no or little means can really inspire people to achieve, as long as they also have the character needed for the task. The problem is, the corporations of this country have proven that they would be more than happy to employ 8 year olds, sell bad milk, create exploding cars etc. in order to save a buck. That's why we have laws and regulations. The minimum wage has been criminally low for too long. Every time this comes up, we hear about how business knows what's good for business, and how chaos will reign if we raise it. The anarchy hasn't happened yet. __________________ I think the Apocalypse is happening all around us. We go on eating desserts and watching TV. I know I do. I wish we were more capable of sustained passion and sustained resistance. We should be screaming and what we do is gossip. -Lydia Millet

07-31-2008, 09:39 AM	#115 (permalink)
roachboy Super Moderator Location: essex ma	loquitor: interesting---i don't have time to spell this out more at the moment, so i'll just outline a couple counter-arguments. a. for a corporation to operate at all it has to take account of its impact on its surroundings. one explanation for attempts to change reporting processes is that an emphasis on shareholder returns in reporting has demonstrated itself to not be adequate. from a shareholder viewpoint, not only financial but brand considerations could very easily lead one to think that more comprehensive information, based on a wider range of inputs, provides more comprehensive information about corporate performance and so results in better business decisions. potentially. underneath this, there's no reason to assume, as a freidman type might, that rational action only happens when one's money is on the line. nor is the flipside claim, that anything except profit generation runs beyond the competences of investors, a coherent viewpoint. b. the argument that more inputs from more people opens up possibilities for more corruption is strange--it seems like an argument against public offerings of stock as much as one against a shift into stakeholder-based reporting. by the way, notice how working people disappear again? why is that? __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

07-31-2008, 10:02 AM	#116 (permalink)
loquitur Junkie Location: NYC	RB, the argument I'm making is that shareholder interest, properly understood, includes considerations of other constituencies because such consideration is in shareholder interests. It's similar to what I wrote elsewhere about my law firm treating its employees well - we do that because it's in our interest to do that. That breaks down if you say that other constituencies have a claim that trumps the interests of shareholders. The corruption argument is simple: when the goals of the company are simple and discrete, the grounds on which decisions can be justified are far fewer, and there are fewer opportunities for manipulation of the machinery in favor of the decisionmakers and at the expense of the beneficiaries. The more goals there and the more interests to serve, the more opportunity there is for cloaking self-interested decisions, and the more opportunities there are for corruption. Try to imagine the type of lobbying that goes on in state legislatures, and transpose that to the corporate boardroom. That's what I"m getting at.

07-31-2008, 12:08 PM	#118 (permalink)
roachboy Super Moderator Location: essex ma	the deskilling of labor is one of the main processes that define capitalist organization. so in the context of capitalism, working people are interchangeable--it's one of the many dehumanizing features of this type of organization of production. deskilling also extends--and increasingly so---into "management"--with computers functioning as a prime enabling device. you could say that deskilling is generalized in the context of large-scale capitalist organizations. to switch rhetorical registers for a sec, that's why it's as fucked up as it is in so many ways. of course if you want to see in this form of organization some type of mirror of an image you have of natural hierarchy, you'll be inclined to substitute dream-imagery for the effects of this organization and will see in the abstract image "manager" someone who retains a coherent skill set. in some regions within a given economic sector (those related to software development, say) folk do operate with a discrete skill set on a more-or-less craft basis: but these are exceptions. it turns out that folk who occupy such positions tend to imagine the entire world in the image of themselves, projecting it laterally to fashion a sense of social distinction, above to project some imaginary ladder they aspire to climb, and below to create a sense of social distance from the lesser beings below. but this is a psychological positioning, not a description of the capitalist order. maybe that's why working folk who try to get by on minimum wage keep disappearing from this thread even---we are communicating across a medium access to which is class specific to a great extent and so it is a theater of class or status performance and for the performance of status anxieties at the same time. the cynicism hasn't started yet, btw---it starts when you move from the above to thinking about motives for keeping wages low in these imaginary worlds animated by status anxiety.....no reason to go there when you can do it for yourself. __________________ a gramophone its corrugated trumpet silver handle spinning dog. such faithfulness it hear it make you sick. -kamau brathwaite

07-31-2008, 01:28 PM	#120 (permalink)
loquitur Junkie Location: NYC	RB, that's just wrong. The story of increasing productivity (which is pretty much an imperative in capitalism) is the story of increasing specialization - which in turn means nonfungibility of labor. Unskilled labor commands low wages for a reason, precisely because the lower the skill level the greater the fungibility.