Corporate Profit

This is part 5 of a series on economic injustice. Click here to read from the beginning.

I’m not convinced that raising the federal minimum wage is going to fix anything. This is not only because the aforementioned Self-Sufficiency Standard puts $15/hour as too low. It is also because corporations are digging in their heels against the American people.

I worked at The Garage Billiards in Seattle in 2015. I was excited to finally be in Seattle with its rising minimum wage, and I had hoped to make enough to finally save up to leave the country. My job was hard on my body – I carried heavy totes full of dishes, washed them in an industrial sink that I rinsed as many rat droppings out of as possible, stood in a walk-in refrigerator while wearing a heavy coat and portioning out meat until my hands were stiff from cold, and regularly fought for better equipment than our rusty and cheap French-fry cutter before being shrugged off by my boss who didn’t have to deal with my task of individually connecting the bent blades before cutting at least 6 5-gallon buckets of potatoes for frying each day.

I mention The Garage by name because they happened to be an example in the news recently for adding an “admin charge” to their menu items after the minimum wage in Seattle went up to $15. Though their original sign said their charge was “a direct result of the minimum wage and tip pooling regulations,”[1] they later claimed on Facebook that the surcharge “is not a response to minimum-wage increases. We have gladly raised wages in accordance with our city’s ordinance the last few years and will continue to do so.”[2]

This kind of dishonesty is rampant among businesses who want to avoid paying their employees enough.

As long as there is profit – that is, more money being made than what the cost of production is – workers are producing more money than they are being paid. This is a simple observation, yet it drives capitalists up a wall. They have a right to their profits! They are the ones who came up with the idea and marketed it!

Profit is after everything – after everyone’s paycheck has been signed, after every customer has paid for their goods or services, after assets have been invested in, liabilities accounted for, and expenses covered. If there’s still more left over, it can be re-invested in the company. When looking at CEO salaries[3] and comparing them to the incomes of most workers at those companies, however, the disparity is obvious.

Because every hire has a price tag in the eye of the employer, people are seen as liabilities instead of assets.

As I explained previously, nobody in this country is independent, and no CEO can possibly work hard enough to singlehandedly create the funds they take home. They are dependent upon the labor of their workers, along with all other production investments and assets, to gather those funds.

Just because your name is on your paycheck doesn’t mean you made that much money. Chances are, you’re either making far more or far less than what your labor actually produces.

Studies do not exist on what labor is actually worth – it is simply assumed in the States that the free market solves, and therefore people make what they are worth to the company paying them. Perhaps an entry-level worker doesn’t have the company clout and experience to make as much as their manager does, there are obvious variables. But if you’re making $37 million per day[4] and your lowest-level employees can’t afford to not be homeless, you are a problem.

It never occurred to me while I was growing up in a capitalistic household that such inequality could exist. I simply assumed that the poor were poor by choice, and so were the rich, and those who were the wealthiest had worked the hardest.

It is simply implausible that such profits can be singlehandedly earned. Our worship of individualism blinds us to this fact, because Americans love to hold up the rich as an example of success. But it is not the success of hard work. It is the result of exploitation, which I’m going to have to define for those of you who are getting real worked up: “The action or fact of treating someone unfairly in order to benefit from their work.”[5]

When you call customer service – whether it’s to make a car payment, ask about your phone bill, talk to your health insurance company – you’re most likely not talking to the company you’re paying for the service. You are probably talking to someone at a call center. The company with the brand name pays a call center to represent them, so agents can answer the phone saying, “Thank you for choosing ____, how can I help you?”

This outsourcing is specifically designed to make sure that the major corporation never takes a hit for bad customer service. If someone misquotes to a customer, the call center pays for it, because it’s technically their fault for failing to train their employee. This frustrates customers because they can’t ever get on the phone with someone who has any real power, because they don’t even work for the company. The entire service of customer care is paid for as one expense by the main company, and call centers are hell as a result.

When working in such an environment, there is no way to properly answer a customer’s question. Rather than having a direct manager on hand to transfer a frustrated customer to, these agents are now using outdated interactive artificial intelligence to find information.[6] You literally get headaches from the echoing you hear between humans trying to help each other in a literal junk pile of bureaucratic IVR systems.

While this may alleviate some confusion about company workings, it makes other experiences in the entry-level workforce all the more confusing. If it’s so expensive to hire new people, why don’t companies try harder to avoid high turnover rates? If it’s so hard to keep people, why are companies so ridiculously strict as to penalize new hires for showing up only a minute late? If one of the keys to profits is good customer service, why pay someone else to handle it and do a worse job than your company could?

I ask these questions, but apparently the people who read blogs about this stuff are scratching their heads about why people would quit their jobs.[7] They’re hiring all these people, and they’re paying them as little as possible to make budget, and everyone above them is breathing down their necks over squeezing the means of production from those underneath them.

[1] https://civicskunk.works/what-to-do-when-a-restaurant-puts-a-minimum-wage-service-charge-on-your-bill-2183699e4186

[2] https://www.thestranger.com/news/2017/03/01/24898046/the-new-living-wage-fee-politically-motivated-or-just-another-expense

[3] http://graphics.wsj.com/ceo-salary-vs-company-performance/

[4] https://www.stride.ws/blog/warren-buffett-income-comparison

[5] https://en.oxforddictionaries.com/definition/exploitation

[6] https://www.ibm.com/watson/

[7] https://www.inc.com/marcel-schwantes/why-do-people-really-quit-their-jobs-heres-the-entire-reason-summed-up-in-1-sent.html