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March 02, 2004
Vons Strike Over. The trickle down lie.
The credible rumor is, that the Vons Strike is ending. A majority of Union members have voted to approve a new contract which is not so unlike the contract they declined way back when the strike started. Obigabu points out on the Vons Strike Post that there aren't any Walmart shopping centers in southern California, so why are people saying that the strike is Walmarts fault. First of all, it was Kroger that said it was because of pressure from Walmart they had to reduce benefits. More on topic though, the example of Vons blaming Walmart is a perfect example of the trickle down lie.I was just listening to a news talk show as they talked about the recent trend towards outsourcing work overseas. Specifically how the work being sent is increasingly more skilled labor, ie. jobs Americans want and go to school for. The Bush administration has stated publicly that they think sending jobs overseas is a good thing (and have encouraged companies to do it via tax breaks). The guy on the talk show than said, matter-of-factly, "Of course prices HAVE gone down as a result, but is it worth it." I was flabbergasted. Prices have NOT gone down, they've only gone up. The other thing that has gone up is executive salaries.
While sending jobs overseas does not seem to relate to trickle down economics (reagonomics), it is actually the same thing. In this instance, jobs are being taken from the middle and lower class and sent overseas so that companies can make more profit by lowering costs. Where does this money go? The claim is that it lowers prices and thus helps everyone, even those that lost their jobs. In a nutshell, "Lets give the big companies a break and watch as the benefit to them trickles down to helping the middle majority," in this instance via lower prices. The problem with the theory is, prices have not gone down. Prices never really go down. They go down temporarily sometimes, but always quickly inflate once the need for competition is gone.
The pizza wars from the 80s are a great example. In the 80s, where I lived anyway, most of the pizza places were family owned and not chains. Most restaurants in general WERE chains in Phx at that time, except for pizza places. Than all of the chains moved in, Dominoes, Pizza Hut, etc.. They offered pizza at significantly lower prices to their family run counterparts. Slowly, the family restaurants started to fold. As they did, the price of pizza at the chains started to increase. Today, with far fewer family run pizza joints around, the price of pizza from the chains is higher than they ever were at the family restaurants. This is in stark contrast to the claim that chains can use their economies of scale to have lower prices. While you can point to some chains that do offer lower prices (specifically fast food), you'll find that most chains and/or companies that claim to benefit from economies of scale and/or outsourcing are not cheaper, most not all. The ones that are cheaper will likely raise their prices once their competition is dead.
So who benefits? Where is all this savings going? Executives. The problem with trickle down economics is that it assumes those who have a lot of money will spend their money. It assumes that the more they make the more they'll spend on the lower classes. This has simply proven to be not true. Why this doesn't happen is still up for debate. Its likely that the money doesn't trickle down because the more they have, the more they want to keep. Also, the money they spend goes to luxury items that only benefit a very small minority of those in lower classes. The same goes for these companies who save so much money by sending our jobs overseas. The executives pay themselves more based on higher profits, but no one else in the company or in this country benefits.
This blog raises the question of Who Deserves Company Profits? They make the argument that all employees of the company have a stake and are taking risks for the sake of the company. The argument that the executives are taking all the risk and thus should get the bulk of the profit is simply not true. Years later, there have still been no indictments in the Enron debacle. Corporations are set up to shield their executives from liability. I could argue that the risk for executives is less. If you look at the end of the dot-com era, you'll see that the execs knew when to get out, far before their employees did. They were able to see the coming decline (by having all the information) and sell their shares, at a handsome profit, before the sh*t hit the fan. Once it did hit the fan, it was the employees that really got the brunt of the downside. They too owned stock and had options, which were suddenly worth nothing even as they were losing their jobs.
In the U.K. the two highest paid executives in the country make 24 times as much as the average worker. In the US executives make upwards of 411 times that of the average worker. What is the meaning of this disparity? The answer is in the culture. It would be unacceptable in the UK for executives to make so much more than the employees. A companies board would never agree to that. As an example of the cultural difference. A European bank reported record profits the other day and the American news hailed it as a triumph. Meanwhile, a British paper has the headline, "HSBC denies £7.8bn profit is excessive". They talk about the HUGE salary of £2.4m of one executive. While that is a lot of money, it pales in comparison to what many American CEOs make. Why would profit be excessive? Its because of a fundamental difference in culture. In the US, money is to be hoarded. The more you have, the more successful you are deemed to be. In other parts of the world, they would question why a company needs so much profit. Why didn't they pay their employees more or contribute more? It is understood that the profit is doing little for the economy if it isn't being spent.
Which brings us back to trickle down economics. This last tax break for the rich was supposed to fuel our economy because what else would rich people do with their new found money, other than spend it. The answer is, hold it and grow it. This last Christmas was the big litmus test. Spending for Christmas was good overall, but more for luxury items and not traditional middle class gifts. After Christmas, stores still had full shelves. The middle class did not have enough money to spend, even though the rich seemed to have more, which gives us our jobless recovery.
"With, without"
"And who'll deny it's what the fighting's all about?"
-Us and Them
Posted by wonko at March 2, 2004 11:04 AM
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Comments
Oh my God!!!! Next time you all feel needy and abused, please hop on an airplane and fly to Egypt and see the true sense of NEED! Now, after busting my ass for 24 years and I have no idea how many times I should have died, worked 72 to 96 hours straight with no sleep and food, yeah right, countless times all to defend freedom... and after all that and retiring, I still have to pay monthly $138.72 of my $1496.00 retainer for health insurance, and all that after I see the pay stubs of these greedy, whining Groceery workers that get "TRIPLE PAY" plus holiday pay for what, scanning items and taking my money and they feel that they should not have to pay for any of their benefits...PLEASE... BEAM ME UP SCOTTY!!! This country is so spoiled with greed and deceipt...MORE, I WANT MORE NOW!!!!!! The average VONS worker that worked on a Sunday eight hour shift received the following:
17.00 X 3= 51.00
Sunday bonus= 8.00
X 8 = $462.00 - 20% for taxes, FICA etc = 369.60
and then add the rest of the 40 hour week coming out to around a 1000.00 a week = 4000.00 a month and you can come up with $75.00 a month for health insurance? GREED and SELFISHNESS!!!! NO SYMPATHY fo any of them!!!!! Get a Job America and wake up!!! Everybody wants more and more and will sacrifice less! I say put all you greedy selfish self centered pigs on an airplane and drop you off in the middle of the North African Desert and see how long you live without your selfish "GIVE IT ALL TO ME NOW!" way of life!!!!
Posted by: pdhman at March 2, 2004 03:18 PM
Oh I am so sorry... I hope that I didn't offend any of you poor souls living here in Mammoth... instead of flying over to Egypt, go to your local recruiting office and join up so you can take part in the war against HIGH OIL PRICES!!!! That's right folks, you too can be part of the US force in Iraq to ensure that you can pump gas into your comfortable SUV'S at the expense of a society that has been around for centuries and then, oh boy, you can put a bumper sticker on that SUV that reads the peaceful and oh so logical slogan, "NO BLOOD FOR OIL" or "NOT IN MY NAME" as you fill that SUV up with gasoline that is 72% refined with oil from Southwest Asia...
that is the Persian Gulf area for you College graduates, more specifically, IRAQ! Please, give me break America! The land of the Free? My ass!
This has become the land of the SPOILED and WHINERS!
Posted by: pdhman at March 2, 2004 03:30 PM
And it pays to to jobless here in America... what the hell, go to the local California EDP Office and file a claim... no need to work, have the tax payers support your lazy ass!
Posted by: pdhman at March 2, 2004 03:37 PM
To top it off, you can get Disability (SSI) for being Obese (basically from glutony and sheer laziness) then get a Handicap placard to put in your SUV so you can park right next to the entrance of VONS as you buy tons of food with your weekly SSI and Unemployment benefit check... ONLY IN AMERICA! You know, come to think of it, of the twenty some years I Operated in third world countries, I do not recall seeing any obese people. HMMMM, interesting observation!
Posted by: pdhman at March 2, 2004 03:47 PM
Angry much? :) Just kidding. The thing is pdhman, I agree with everything you said, except your conclusion that because you, who served our country to protect the freedoms we have, don't have full health, neither should Vons workers. I think people should be compensated fairly for the work they've done. In your case, you should have full health for life, no deductables, no copay. Why? Because you put your life on the line to protect the beurocrats in Washington who DO have full health for life and then some. You served to protect the rights of people like me to speak my mind without worrying about retribution. People in this country ARE whiners. We've talked about how we use more resources than any other country, and its still not enough. However, I do not think the answer, as you imply, is to 'lower' everyone to the same level. Our government is LETTING big drug companies take advantage of us. We pay more for drugs and health than any other country. We pay more for the same drugs they do, because we allow the drug companies to overcharge us. What is wrong with arguing for better health benefits for everyone? Instead of saying the Vons employees should stop whining about losing their good health coverage, why not argue for why you, who risked his life for our country, deserves as good, if not better coverage than them? Would anyone disagree?
Fundamentally, I dissagree with lumping our whining desire for huge, gas guzzling SUVs, with people trying to get health coverage for themselves and their children. Hummers are not necessities, but health care is. Don't fight against others, fight for everyone.
Posted by: Wonko at March 2, 2004 06:01 PM
Clearly it is not my opinion that the VONS employees should not retain their benefits... my opinion is that in general, the mentality of this Nation is selfish desires of an overwhelming proportion that in fact has destroyed all concept of eqaulity for all in so far as the Constitution dictates. Our forefather's never invisioned such a society that is propelled by materialistic status and that everything one strives for is the current philosophy..."He who dies with the most toys wins!" For the most part, all those toys are not even owned by the operators, they are simply purchased on credit with money that most do not even have. I agree with Greenspan... take the money out of SS... take it out of the 48% of the funds that is given to indivuals that claim false disabilities... put the burden back on the nation to stop using credit and start paying for items out of ones earned funds. As far as the Corporate control, it's a given and there is nothing that will stop it as long as individuals in this country continue to purchase by credit and strive to have more than their earnings allow... it is called GREED and UNGRATEFULNESS!
Posted by: pdhman at March 2, 2004 10:07 PM
I think the issue was that Wal-Mart planned on selling groceries. Oh, and there are "Walmart shopping centers" in Southern California. Wal-Mart is evil. I listened to Michael Moore's book "Dude, Where's My Country" and he said that Wal-Mart used to take out "dead peasants insurance" policies. Wal-Mart would take out these policies on their lower wage employees and sign themselves as the beneficeries not the employees' families. I find it ironic that as bad as Wal-Mart is, it doesn't deter low income families from shopping there because in most cases it's the cheapest option for them. Or perhaps they just aren't aware of how evil Wal-Mart really is.
Posted by: useEvil at March 2, 2004 11:44 PM
I'm not even going to stick my head into this one.
Anders
Posted by: Anders at March 4, 2004 12:28 AM
I wish I had made not of that the names in the interview on NPR about the Vons Strike, because as useEvil has explained, There IS a Walmart Superstore in SoCal. Sorry for passing on incorrect info.
Posted by: obigabu at March 4, 2004 06:55 PM
Well, for anyone still reading this thread, i'd like to update you all on the effects, as advertised, of the horrible contract we were forced to accept so you "educated" masses would stop complaining about us. The two tier wage system has destroyed any kind of control on turnover we once had. I've hired 12 people for my 3 person department since march. they show up, decide its not enough money for the work, and leave. (if you don't know what the two tier wage system is, and think the strike was over $5, go stick it in a blender.)
All i can say is, after months of trying to educate the snobish customer base in southern california, i'm having a hard time respecting my community, which found it all too easy to blame the pawns in this game instead of the generals. The union or the company.... fight them, don't fight me. the union gets the votes it wants to get, decides what it wants to decide, and will gladly stick it to all of its members to save itself. the company would also send every one of us to hell before seeing a profit loss of a hundredth of a percent.
And for everyone who bagged on us for being uneducated bananna scanners etc., i'm sorry my mommy and daddy couldn't pay to send me to college. i'm sorry when i moved out at 18 i had to fight for survival in this armpit of an economy. I'm doing the best i can to get by, so thanks for all the compassion.
so next time you are walking into a store and a worker is going home, remember that look in his eyes is dissapointment in his fellow man. you know, the ones he tries to serve all day long... the ones he won't let leave until they are happy. and i hope you are proud of yourself.
Posted by: VonsDeliManager at October 2, 2004 11:36 PM
Thanks for the update VonsDeliManager. All we can do is keep fighting. The meager optimistic part of me sees hope in how the struggle that was one relegated to those below the middle class is starting to creep upward. While the upper class in this country looked with contempt at those at the bottom, the middle class was content knowing they would be alright and didn't need to fight for anyone. Thats all changing now. The struggles all to common to the common worker are becoming common to the middle class worker. Health care, salaries not keeping up with inflation, overtime pay cuts, more work hours and less vacation. When it gets bad enough for the middle, things will change and at this rate, we're not far off. So keep up the good work and keep up the hope.
Posted by: wonko at October 3, 2004 03:35 AM
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