Posts Tagged ‘workers’

surplusvalue

We’ve been over this before but, like a bad penny, it just keeps coming back. . .

Conservatives and liberals seem not to agree about anything these days (as my students often complain). But there is one idea they do share: the wages-system needs to be protected at all costs.

Economists, politicians, and columnists from the two ends of the political spectrum do have different starting points: conservatives believe that workers are at bottom shirkers, and therefore need to be forced off their “dependency” on government programs in order to lower the reward for non-work, while liberals start with the idea that workers today are not being paid enough, at least those at the bottom, and the minimum wage should be raised in order to raise the reward to work.

Yet, while conservatives and liberals have different starting-points, they agree that there is a fundamental dignity in working for someone else. Here’s the liberal version, from Charles Blow:

No one should ever endure the kind of economic humiliation that comes with working a full-time job and making a less-than-living wage.

There is dignity in all work, but that dignity grows dim when the checks are cashed and the coins are counted and still the bills rise higher than the wages.

Most people want to work. It is a basic human desire: to make a way, to provide for one’s self and one’s loved ones, to advance. It is that great hope of tomorrow, better and brighter, in which we can be happy and secure, able to sleep without hunger and wake without worry.

But it is easy to see how people can have that hope thrashed out of them, by having to wrestle with the most wrenching of questions: how to make do when you work for less than you can live on?

Really? A “basic human desire”? We all warn our students about making such sweeping, universal students—especially when not a shred of evidence is presented. But the problem here is worse. It’s the presumption that people want to work (instead of being forced to work) and that working is somehow making one’s own way (instead of being dependent on the whims and wishes of private employers).

In other words, it’s the same argument conservatives make: everyone wants (and at least should want) to be a worker. Except, of course, for those at the very top, who are dependent on getting a cut of what workers produce.

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Special mention

April 16, 2014 marketvalue

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According to the AFL-CIO’s latest “Executive Paywatch” report, the CEO-to-average-worker-pay ratio rose last year to 331:1. And the ratio of CEO pay to the minimum wage was much higher: 774:1.

That’s because, in both cases, workers’ wages remained more or less constant while the amount of surplus those workers created that ended up in the pockets of the CEOs of the nation’s largest corporations continued to rise.

As the AFL-CIO argues in their report:

America is supposed to be the land of opportunity, a country where hard work and playing by the rules would provide working families a middle-class standard of living. But in recent decades, corporate CEOs have been taking a greater share of the economic pie while wages have stagnated and unemployment remains high.

High-paid CEOs of low-wage employers are fueling this growing economic inequality. In 2013, CEOs of the Standard & Poor’s (S&P) 500 Index companies received, on average, $11.7 million in total compensation, according to the AFL-CIO’s analysis of available data from 350 companies.

Today’s ratio of CEO-to-worker pay is simply unconscionable.

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Thousands of workers at a major shoe factory in China, which employs more than 40,000 workers in Dongguan and supplies brands including Nike and Adidas, are striking over social security payments.

Workers at the Yue Yuen factory, in the southern industrial hub Dongguan, are demanding better social insurance and housing fund contributions.

The dispute has been ongoing since early April, with workers reportedly rejecting an offer from the company.

China has faced growing labour strikes in recent years.

The Yue Yuen workers are said to be angered at unpaid social security payments.

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Good news! The campaign of protests against the unwarranted budget cuts at the University of Southern Maine has been successful:

University of Southern Maine President Theodora Kalikow has reversed the 12 faculty layoffs that prompted weeks of protests, saying she’s open to alternative plans for finding up to $14 million in cuts.

However, at least at this point, it appears the victory is still only partial and incomplete:

When asked if the faculty members might still be laid off if alternate cuts are not found, Kalikow said they would not. However, she did not reverse the decision to eliminate about 30 staff positions. . .

Still scheduled to be closed are three academic programs: the American and New England studies graduate program, geosciences, and the arts and humanities major at Lewiston-Auburn College, which is part of USM. If those programs are eliminated, seven professors will be laid off.

Update

And, while we’re at it, more good news: UPS is going to rehire the 250 Queens drivers [ht: sm] who lost their jobs in late March for participating in a 90-minute walk-out to protest the firing of union activist and longtime employee Jairo Reyes.

“We have sent a clear message to corporate America that firing workers en masse for minor workplace disagreements is unacceptable,” said Public Advocate Letitia James, who had warned UPS that its large state contract and city perks could be jeopardized if it didn’t negotiate with the union. The drivers will, however, have to accept some lost wages: As part of the agreement, they will all serve a two-week suspension, which means giving up about $2,560 each.

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Special mention

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Protesters from the Communist-affiliated trade union PAME shout slogans as they march towards the parliament during a general labour strike in Athens

Greek labor unions staged a nationwide strike today to protest against austerity policies imposed on the country by the current government and its foreign creditors, including Germany.

Schools and pharmacies were shut, ships remained docked at ports, hospitals operated on emergency staff, and transport in Athens was disrupted due to the 24-hour strike called by private sector union GSEE and its public sector counterpart ADEDY.

More than 20,000 workers, pensioners, students and the unemployed marched peacefully through the streets of the Greek capital chanting “EU, IMF take the bailout and get out of here!”

Unions said their anti-austerity message was also aimed at German Chancellor Angela Merkel, who is due to meet Greek Prime Minister Antonis Samaras in Athens on Friday. Germany has insisted on painful spending cuts and tax hikes in return for international loans.

“It’s time to save people not banks,” said 59-year old economist Eleni Prokou. “Merkel and the troika should stop sticking their nose in our business.”

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According to Joe Coscarelli [ht: sm],

A 90-minute walk-off in late February has cost 250 UPS drivers in Queens their jobs — 20 of them now, and the other 230 when the company has trained their replacements, the Daily News reports. The protest was staged in response to the firing of an employee and union activist with 24 years of experience. “These are middle class jobs that sustain families, and we can ill afford to have [so many] adversely affected by a rash decision,” said Public Advocate Letitia James, who has taken the workers’ side.

“Although UPS maintains that the job action was illegal, these tools have been staples of successful labor movements, and union members should not be restricted from employing these strategies if they feel workers are being treated unfairly,” reads a city council proclamation, delivered ahead of a City Hall press conference tomorrow.

But UPS says the drivers knew the deal, even the one who just came back from an on-the-job brain injury:

One of the workers who faces dismissal just got back on the job following a near-fatal accident.

Domenick DeDomenico, 40, was in a coma for 10 days after getting hit by a car last year while delivering packages for UPS. He fought back from serious brain injuries and needed a year of speech and physical therapy.

Just in case the giant corporation was seeming too sympathetic.

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I have to spend the rest of the day preparing Upton Sinclair’s The Jungle for class tomorrow (for the labor section of my course on Commodities: The Making of Market Society). But before I get to that. . .

The campaign against college players forming unions, as exemplified by Patrick T. Harker in his column today, continues to repeat the false impression that what the “student-athlete-employees” are demanding is to be paid for their efforts. (Even Joe Nocera, who has been very good on exposing the NCAA’s mistreatment of college athletes, makes the mistake.) No, what these employees are asking for is a voice in setting and enforcing the rules that govern their employment in NCAA-supervised athletic competitions—nontrivial things like how much time they are forced to spend in preparing for their sports, what majors and courses they can take, whether or not athletes who are injured will be given adequate medical care, and so on. No one—except the cavalcade of critics—is talking about making the athletes paid employees.

Sure, as Mark Thoma explains, rent-seeking behavior can explain at least some of the rise in inequality we’ve seen in recent decades. But why go through such tortured explanations, which require one or another deviation from perfect competition, when we can explain inequality in a much simpler manner, even when there’s perfect competition: surplus-seeking behavior. Because that’s what we need to focus on: the ability of a tiny minority in today’s economy to capture and keep the surplus being produced by the majority of workers. And how do they manage to get that surplus? Through high corporate profits that flow into CEO salaries, the growth of the financial sector, and capital gains, which in turn are taxed at low rates. And then, on top of those “normal” flows of surplus, we can consider various forms of market power that culminate in economic rents, which make the already-unequal distribution of income based on flows of the surplus even more unequal.

Speaking of inequality, how is it possible to write a paper on “Consumption Contagion: Does the Consumption of the Rich Drive the Consumption of the Less Rich?” in which Marianne Bertrand and Adair Morse [pdf] describe yet another departure from the Permanent Income Hypothesis, and never mention Thorstein Veblen and his Theory of the Leisure Class?

And, finally, under the heading of “let them eat flip-flops and cheap lingerie from Macy’s,” Thomas Edsall does a nice job summarizing the literature that explains why American workers might be wary about the claims that everyone gains from free trade and how the arguments of free-trade zealots like Jagdish Bhagwati ring so hollow these days.

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Answer (according to Kathleen Madigan):

College football’s “Norma Rae” moment joins other recent pay-related episodes. First was the proposal to raise the federal minimum wage. Next came the White House’s directive to expand the number of workers eligible for overtime pay. Employees who currently work extra hours for free will soon get paid for their time.

Add in interns and citizen journalists that perform duties for free and a trend is evident: The U.S. economy may be the richest in the world, but sections of it depend on cheap or free labor.