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Showing Original Post only (View all)"Sorry, It's Not a 'Law of Capitalism' That You Pay Your Employees as Little as Possible. It's..." [View all]
"a choice."
http://www.businessinsider.com/companies-need-to-pay-people-more-2013-8
Sorry, It's Not A 'Law Of Capitalism' That You Pay Your Employees As Little As Possible
Henry Blodget
AUG. 7, 2013, 10:51 AM 107,347 219
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But, unfortunately, over the past three decades, what began as a healthy and necessary effort to make our companies more efficient has evolved into a warped consensus that the only value that companies create is financial (cash) and that the only thing managers and owners should ever worry about is making more of it.
This view is an insult to anyone who has ever dreamed of having a job that is about more than money. And it is a short-sighted and destructive view of capitalism, an economic system that sustains not just this country but most countries in the world.
This view has become deeply entrenched, though.
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This view, unfortunately, is not just selfish and demeaning. It's also economically stupid. Those "costs" you are minimizing (employees) are also current and prospective customers for your company and other companies. And the less money they have, the fewer products and services they are going to buy.
Obviously, the folks who own and run America's big corporations want to do as well as they can for themselves. But the key point is this:
It is not a law that they pay their employees as little as possible.
It is a choice.
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It is a choice that reveals that, regardless of what they say about how much they value their employees, regardless of what euphemism they use to describe their employees ("associate," "partner," "representative," "team-member" , they, in fact, don't give a damn about their employees.
These senior managers and owners, after all, are earning record profits while choosing to pay their employees so little in many cases that the employees have to live in poverty.
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CHART ONE: Corporate profits and profit margins are at an all-time high. American companies are making more money and more per dollar of sales than they ever have before. Full stop. This means that the companies have oceans of cash to invest. But they're not investing it. Because they're too risk averse, profit-obsessed, and short-term greedy.
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CHART TWO: Wages as a percent of the economy are at an all-time low. Why are corporate profits so high? One reason is that companies are paying employees less than they ever have as a share of GDP. And that, in turn, is another reason the economy is so weak. Those "wages" represent spending power for American consumers. American consumer spending is revenue for other companies. So the profit maximization obsession of American corporations is actually starving the rest of the economy of revenue growth.
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CHART FOUR: The share of our national income that American corporations are sharing with the people who do the work ("labor" is at an all-time low. The rest of our national income, naturally, is going to owners and senior managers ("capital" , who have it better today than they have ever had it before.
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