"Never give a
sucker an even break." - W.C. Fields
Normally I would deem a title such as
the above inappropriate for an article like this. It is not so much that the reader would be
shocked or offended, but that vulgarity tends to subtract from the
quality of one's argument, while adding nothing of importance to the
gist. I came very close to titling this article The Short End of the Stick. Please
allow me to explain why I didn't. Prior to the 20th
century, the majority of Americans lived on small farms. When a cow
or a horse got sick, the most common way of administering treatment was by
means of suppositories. Often, this required the use of a
stick. As you can imagine, many jokes circulated about farmers, who,
due to some unanticipated twist of fate, ended up holding the "shit end of
the stick." Today, these jokes have largely lost their
relevance. The few that do survive have been sanitized into the
"short end of the stick." This article proposes to
examine what type of deal those of us at the bottom of the corporate
ladder feel we are getting from the
corporations that employ us. As you probably already
suspect,
there is nothing clean about it. There is no mechanism
by which I
can convey the degree of filth without making reference to
fecal
matter.
Entry level positions in corporations are
all pretty much the same. They start with a probationary period of
somewhere between 90 and 180 days during which the worker can be terminated
without giving any reason whatsoever. This is one hell of a way to
start a new job. What crime did the new worker commit that resulted
in him/her being sentenced to probation? Is this punishment
without cause meted fairly to all or are newly hired management
employees exempted? Why isn't this sort of discrimination
illegal? Things could be worse. Part-time and
temporary workers don't really have a job. They get shuffled from
company to company and have absolutely no rights. Keeping a few of
them around helps to remind workers how easily they can be
replaced. Newly hired workers are normally not permitted
to participate in the company's medical plan until they have finished
probation. If they or their dependents become ill or suffer an injury in
the interim, it's their own tough luck. And, to add an insult to
the injury, a probationary employee who misses work can almost
always expect to be fired.
In his
autobiography, Faith of My Fathers, former Navy pilot, POW, and Republican
presidential candidate John McCain describes how, after sustaining injuries when shot down by a missile over Hanoi,
he pleaded for
a doctor but was refused medical treatment for four days because of his "bad
attitude." Not having signed the
Geneva Convention, The North Vietnamese maintained that they had no
responsibility to treat downed fliers as prisoners-of-war -- a legal technicality that McCain vehemently
protested. Like McCain's captors, employers love to wallow in legal technicalities.
Their justification for
withholding medical care from new hires and their dependents is that these
workers are not yet full fledged employees. Corporations
who are supposedly our allies refuse medical care for 90 to 180 days whereas the evil
Communist enemy relents after four days. It makes you wonder who is
guilty of crimes against humanity, doesn't it? There
are those who would argue that care is always available at county
hospitals. I know better. The county hospital near me is being
demolished to make way for a building supplies retailer. As employers
increasingly abrogate their responsibilities towards their employees,
government is expected to pick up the tab. When it refuses, as
happens all too often, sickness goes untreated and disease gains the
potential to spread and infect the rest of us. Failing
to provide new hires with health coverage is a sin of omission
that might be forgivable if American businesses were not making a
profit. According to Forbes magazine, however,
business could hardly be better. In 1999 profits increased 26 percent
for America's 895 largest corporations. The Federal Reserve says
the current economic expansion is the longest on record. There
seems to be no reason for being stingy other than
greed. But to be fair, we need to look at whether the
people who run these companies are acting out of dedication to
principles. It's possible that they ask no more of others than they
are willing to give themselves. Maybe it was hard work and
self-denial that got them where they are today. The
numbers say otherwise. Michael D. Eisner, head honcho of Walt Disney,
received a compensation package (salary plus stocks) of $589,101,000 in
1998. The following year, earnings of the top 800 heads of
corporations jumped 12.8 percent to a combined total of $5.8 billion.
Clearly, these men are in it for the money.
Gilbert Amelio, the former CEO of Apple Computer,
serves as a good example of how corporate greed is out of control.
According to an executive pay report in the Wall Street Journal, Apple
lost about $2 billion during Amelio's brief tenure of 17 months.
Some 3,600 employees lost their jobs. Yet Amelio's "golden
parachute"
exit clause garnered him $6.7 million in severance pay plus
other compensation. Amelio had the nerve to say that the Apple
package "didn't protect my downside as well as I had hoped it
would." Most corporate leaders would say any government
regulation of CEO pay would be a terrible interference in the free
market. But the federal government is already deeply involved in CEO
salaries through the tax code. The tax code allows businesses to
deduct a "reasonable allowance for salaries or other compensation."
Since the code doesn't define the term "reasonable," corporations can
- and do - routinely deduct 100 percent of exorbitant executive
pay packages. The corporation pays less in taxes than it should,
and the ordinary taxpayer - you and I - picks up the
slack. Chief executive officers also benefit
tremendously from a cut in the long-term capital gains tax from 28 percent
to 20 percent. For every $1 million in long-term capital gains they get
from the sale of stock, they now pay $80,000 less in
taxes. Yes, the rich are getting richer. And, to
make things worse, they are doing it at the expense of taxpayers like
ourselves. You probably already suspected as much. What you
really want to know is how everyone on the other end - the end of the stick
that fate stuck you with - are faring. A study funded
by the Russell Sage Foundation, as reported in the July 10, 2000 issue of
Business Week, concludes that "despite America's record-breaking economic
boom, poverty among full-time workers has increased." According to
Dr. Linda Barrington, the author of the study, "the number of full-time
workers classified as poor increased between 1997 and 1998. Over the
last quarter century, the poverty rate among full-time workers has been
higher only twice - 1982 and 1983 - years in which the economy
was coming off a recession." "Simply working
full-time year-round, even in a booming economy, is not enough to lift
everyone out of poverty," says Barrington. "The benefit to the lowest
paid workers from being fully engaged in the workforce, as measured by the
poverty rate, is not improving. This time trend provides an important
economic backdrop to the recent movement of people off government
welfare
rolls and into the workforce, as well as cautionary context
for these otherwise prosperous times." The study
further determined that since 1973, poverty has increased in both overall
number and as a percentage of people employed full-time and
year-round. Nearly three percent of all full-time workers were living
under the poverty line (defined as $13,003 for a family of three) in 1998,
the latest year for which data was available. Including dependents,
this could be upwards of five million people. The
Boston-based organization United for a Fair Economy (UFE) discovered that
if the 555 foot Washington Monument reflected the average 1997 CEO pay,
then a replica depicting average worker pay would be just 21 inches
tall. Back in 1970, when the wage gap was 41
to one, the Workers Monument measured 13 feet, 6
inches. The UFE unveiled the Workers Washington Monument
at a Capitol Hill press conference. Chuck Collins, UFE co-director,
said, "In 1970, it would have required a pickup truck to transport
the Workers Washington Monument. By 1996, you could carry it on
an airplane and put it in the overhead luggage bin. The 1997
model fits easily in the little space under the seat." Nowadays,
the Workers Monument would fit in your pocket.
In their 1992 book, Putting People
First, Bill Clinton and Al Gore remonstrated, "It's time to honor and
reward people who work hard and play by the rules...No one who works full
time and has children should be poor any more." Now, eight years
later and at the end of their second term in office, I think it appropriate
to ask where is the fulfillment of that promise? Clearly, those
who play by the rules are losing the game. The
disparity between the top and the bottom of the corporate
ladder has become, in the words of management guru Peter
Drucker,
"unconscionable." In the top echelons of the corporate world animal
cunning too often masquerades as intelligence. Indeed, it would appear
that the average employee has gotten stuck with the shit end of the stick. The
end result can only be increased social
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