"The human cost of low wages is obvious and has been extensively documented. But there are important economic and business costs to low wages that are far less clear and little understood. Many of America’s largest employers pay as little as possible, driving down the consuming power of their workers, and then wonder why their customers are unable to spend."
"Henry Ford's Genius Wage Hike", Daniel Gross, The Daily Beast, 2014-01-06.
Some of the comments add a bit more nuance, such as Henry Ford was not all that angelic in paying "all" of his assembly-line workers that much. They had to meet certain personality standards with home checks that few people would tolerate today.
Henry Ford, at least partially, was following Adam Smith's advice:
"The liberal reward of labour, therefore, as it is the necessary effect, so it is the natural symptom of increasing national wealth. The scanty maintenance of the labouring poor, on the other hand, is the natural symptom that things are at a stand, and their starving condition, that they are going fast backwards."
His contemporaries and his successors seem to be bent at making things go "fast backwards".
For more ignored advice from Adam Smith, see "The Invisible Adam Smith".
Showing posts with label poor. Show all posts
Showing posts with label poor. Show all posts
Monday, January 06, 2014
Saturday, March 03, 2012
The party of pluck and luck versus the parties of cluck
I started to read a tribute to Andrew Breitbart, ("Andrew Breitbart's final message to the left" by Star Parker, Scripps Howard News Service, 2012-03-02) a severe critic of the "left", and couldn't read any further. Like so much writing nowadays, no matter the source, it gives sweeping praise to "our side" and sweeping castigation to "the other side".
We have those who have financial resources claiming that they earned their wealth, and those who feel that many have been left behind have been put there through no fault of their own by those with excessive wealth.
Parker claims that the wealthy have more stable families, et cetera, et cetera; and that the poor have out-of-wedlock births and single parent families, et cetera, et cetera. Could it be that the more wealthy have more resources to hide their dysfunctional families? Could it be that the less wealthy have these problems because they are less wealthy?
Parker blames the left for creating all these problems, including the sexual revolution which increased poverty.
I got news for Parker and others who blame those who are trying to solve certain problems for creating those problems. They have been around for centuries.
I was born in March 1938, supposedly six weeks premature at 8+ pounds. My parents were divorced in 1943. When I was in college, my mother showed me her marriage certificate; she was married in September 1937. You do the math.
Many years later I found out that my great-grandfather left his family in 1904 because he loved women and wine. Even later I found out that his likely father, born in 1818, probably had a "girl in every port" - one in Brooklyn, New York, one in Baltimore, Maryland, and one in Liverpool, England. The person with my surname married in Liverpool gave his father's name as Vincent Magree. Vincent Magree was listed in the 1840 census in Baltimore with a male between 10 and 15 years old.
Well, some of the descendants became college-educated and well-paid, some continued to struggle, and some just muddled.
I can't speak for all my relatives as to how they arrived where they did, but I know my own life has been a crazy stew of pluck and luck. I had a family that expected me to do well in school. But many were the times I could have blown it with some stupid act. I had a teacher who encouraged us to go to a highly-rated engineering school. I had an assistant principal who found a full-scholarship for me to that school. I blew that by being unsure of what I wanted to do. I had a registrar in another college accept me and encourage me to study mathematics. That got me into graduate school in the school I flunked out of. That school happened to be buying a new computer. The manufacturer of that computer was hiring and hired me. And on and on with ups and downs. Some of these because I kept trying, some because somebody helped me, some because I kept screwing up. Pluck and luck, over and over again.
Right now we have two parties of "cluck". One claims that the wealthy are solely responsible for their wealth without recognizing all the clerks, laborers, and government institutions that supported them. The other claims that the wealthy are solely responsible for the problems of the poor without recognizing that that some of those problems (not all) are self-inflicted. These are the factions that James Madison warned about in Federalist No. 10
We really need a party of "pluck and luck". One that recognizes that problems go beyond blame, that many of these problems have been with our country since before the Revolution, and that we have to keep trying to provide some means of increasing the opportunities for both pluck and luck. We need a party that truly recognizes the problem of balancing "public good and private rights" - James Madison, Federalist No. 10.
We have those who have financial resources claiming that they earned their wealth, and those who feel that many have been left behind have been put there through no fault of their own by those with excessive wealth.
Parker claims that the wealthy have more stable families, et cetera, et cetera; and that the poor have out-of-wedlock births and single parent families, et cetera, et cetera. Could it be that the more wealthy have more resources to hide their dysfunctional families? Could it be that the less wealthy have these problems because they are less wealthy?
Parker blames the left for creating all these problems, including the sexual revolution which increased poverty.
I got news for Parker and others who blame those who are trying to solve certain problems for creating those problems. They have been around for centuries.
I was born in March 1938, supposedly six weeks premature at 8+ pounds. My parents were divorced in 1943. When I was in college, my mother showed me her marriage certificate; she was married in September 1937. You do the math.
Many years later I found out that my great-grandfather left his family in 1904 because he loved women and wine. Even later I found out that his likely father, born in 1818, probably had a "girl in every port" - one in Brooklyn, New York, one in Baltimore, Maryland, and one in Liverpool, England. The person with my surname married in Liverpool gave his father's name as Vincent Magree. Vincent Magree was listed in the 1840 census in Baltimore with a male between 10 and 15 years old.
Well, some of the descendants became college-educated and well-paid, some continued to struggle, and some just muddled.
I can't speak for all my relatives as to how they arrived where they did, but I know my own life has been a crazy stew of pluck and luck. I had a family that expected me to do well in school. But many were the times I could have blown it with some stupid act. I had a teacher who encouraged us to go to a highly-rated engineering school. I had an assistant principal who found a full-scholarship for me to that school. I blew that by being unsure of what I wanted to do. I had a registrar in another college accept me and encourage me to study mathematics. That got me into graduate school in the school I flunked out of. That school happened to be buying a new computer. The manufacturer of that computer was hiring and hired me. And on and on with ups and downs. Some of these because I kept trying, some because somebody helped me, some because I kept screwing up. Pluck and luck, over and over again.
Right now we have two parties of "cluck". One claims that the wealthy are solely responsible for their wealth without recognizing all the clerks, laborers, and government institutions that supported them. The other claims that the wealthy are solely responsible for the problems of the poor without recognizing that that some of those problems (not all) are self-inflicted. These are the factions that James Madison warned about in Federalist No. 10
We really need a party of "pluck and luck". One that recognizes that problems go beyond blame, that many of these problems have been with our country since before the Revolution, and that we have to keep trying to provide some means of increasing the opportunities for both pluck and luck. We need a party that truly recognizes the problem of balancing "public good and private rights" - James Madison, Federalist No. 10.
Sunday, February 05, 2012
Is Mitt Romney fit to govern?
Mitt Romney seems to be out of touch with so much. His statements include "Not concerned with the very poor" and "Corporations are people". Yeah! Made up of people, but it's the few who speak for the corporation without consultation with the many. Those few are not elected in competitive elections by the many. Then his math is atrocious "I’m concerned about the very heart of America, the 90, 95 percent of Americans who right now are struggling." See "Romney fails the empathy test", Eugene Robinson, Washington Post, 2012-02-02.
If 90-95 percent are struggling, why are new car sales up? Why are many brew pubs opening and why are popular restaurants full? Yes, many of that 90-95 percent are struggling (including the 15-20 percent who are considered poor), but many others of that group are not struggling. It could be that this statement is an attack on President Obama; in other words, everything is screwed up because of Obama and I, Mitt Romney, will make it all better. Interestingly, some of the data coming out seem to indicate that Obama "has made" a lot better already. Or maybe more people are thirsty for good beer or more people like the features in newer cars or…
If 90-95 percent are struggling, why are new car sales up? Why are many brew pubs opening and why are popular restaurants full? Yes, many of that 90-95 percent are struggling (including the 15-20 percent who are considered poor), but many others of that group are not struggling. It could be that this statement is an attack on President Obama; in other words, everything is screwed up because of Obama and I, Mitt Romney, will make it all better. Interestingly, some of the data coming out seem to indicate that Obama "has made" a lot better already. Or maybe more people are thirsty for good beer or more people like the features in newer cars or…
Monday, December 05, 2011
Quote of the Day: Job Creation
"When businesspeople take credit for creating jobs, it is like squirrels taking credit for creating evolution. In fact, it’s the other way around." "Raise Taxes on Rich to Reward True Job Creators", ice Hanauer, Bloomberg Businessweek, 2011-12-05.
Hanuer writes that he paid "an 11 percent rate on an eight-figure income."
Hanuer writes that he paid "an 11 percent rate on an eight-figure income."
Sunday, December 04, 2011
High profits are the road to ruin - Adam Smith
The Rev. Bruce Johnson of the Unitarian-Universalist Congregation of Duluth gave a sermon this morning on consumerism - "Consuming Religion". In it, he used "free markets" in the corrupt sense, that is, business is free to do whatever it wants, free of regulation. I knew that Adam Smith used "free market" only once in "Wealth of Nations"; I wondered how often he used "regulation".
Well, I gave up counting, but I noted that he treats regulations as both good and bad. One of the good senses is that regulations prevent abuses. One of the sections that mentioned regulation discussed the three classes involved in the economy - one does nothing and keeps getting richer, the second is necessary to get things started, and the third actually does the work. Here is what he wrote about the second, those who supply the capital (stock in the sense of materials, equipment, and workplaces).
"It is the stock that is employed for the sake of profit, which puts into motion the greater part of the useful labour of every society. The plans and projects of the employers of stock regulate and direct all the most important operation of labour, and profit is the end proposed by all those plans and projects. But the rate of profit does not, like rent and wages, rise with the prosperity, and fall with the declension of the society. On the contrary, it is naturally low in rich, and high in poor countries, and it is always highest in the countries which are going fastest to ruin."
Well, I gave up counting, but I noted that he treats regulations as both good and bad. One of the good senses is that regulations prevent abuses. One of the sections that mentioned regulation discussed the three classes involved in the economy - one does nothing and keeps getting richer, the second is necessary to get things started, and the third actually does the work. Here is what he wrote about the second, those who supply the capital (stock in the sense of materials, equipment, and workplaces).
"It is the stock that is employed for the sake of profit, which puts into motion the greater part of the useful labour of every society. The plans and projects of the employers of stock regulate and direct all the most important operation of labour, and profit is the end proposed by all those plans and projects. But the rate of profit does not, like rent and wages, rise with the prosperity, and fall with the declension of the society. On the contrary, it is naturally low in rich, and high in poor countries, and it is always highest in the countries which are going fastest to ruin."
Friday, December 02, 2011
Comment on "job creators"
I posted the following as a comment to the Coffee Party's Facebook posting of "7 Ways to Support the Real Job Creators".
I highly recommend slogging through the 1000+ pages of 18th Century English that are Adam Smith's "Wealth of Nations".
Would you believe that he is more sympathetic to the workmen than the masters? That he thinks banks should be regulated? That taxes are necessary? That we have to co-operate with and assist one another? That talents come from our experiences? That he doesn't believe in giving 110% to employers? That the rich get rich at the expense of the poor? That governments are needed to enforce contract law? That merchants complain that high wages affect the economy but say nothing of how high profits affect the economy? That honorable professions are underpaid? That regulations are needed to prevent abuse? That he doesn't think much of corporations controlling government? That corporations are not concerned with the public interest? That although he complained it was illegal for workers to unite to raise wages but legal for masters to unite to keep wages down, he didn't think much of labor unions? But that regulations in favor of workers were just but those in favor of the masters were unjust?
Those are only some of the comments with which I annotated the first 150 pages of my Project Gutenberg copy of "Wealth of Nations".
I highly recommend slogging through the 1000+ pages of 18th Century English that are Adam Smith's "Wealth of Nations".
Would you believe that he is more sympathetic to the workmen than the masters? That he thinks banks should be regulated? That taxes are necessary? That we have to co-operate with and assist one another? That talents come from our experiences? That he doesn't believe in giving 110% to employers? That the rich get rich at the expense of the poor? That governments are needed to enforce contract law? That merchants complain that high wages affect the economy but say nothing of how high profits affect the economy? That honorable professions are underpaid? That regulations are needed to prevent abuse? That he doesn't think much of corporations controlling government? That corporations are not concerned with the public interest? That although he complained it was illegal for workers to unite to raise wages but legal for masters to unite to keep wages down, he didn't think much of labor unions? But that regulations in favor of workers were just but those in favor of the masters were unjust?
Those are only some of the comments with which I annotated the first 150 pages of my Project Gutenberg copy of "Wealth of Nations".
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