Wednesday, April 17, 2013

It’s not enough to redistribute the wealth. We’ve also got to redistribute the work.

I was a college student early in the second half of the last century when I decided that a fellow student had gone stark, raving bonkers.

“I’ve been reading up on something called automation,” she said, “and I’ve learned a day is coming when it will be a privilege to work.”

Actually, it sounded even crazier than you might guess if you could remember the pleasant ethos of almost-fully-employed America in 1957. It sounded crazy not only because the notion that it would be a privilege to work seemed inconceivable, but also because she had a quirk of speech that conjured up images of Elmer Fudd. She said it something like this: “I’ve been weading up on something cawed awtomation, and I’ve wearned a day is coming when it wiw be a priviwedge to work.”

[Note to my friend and fellow former college mate Buce: Yes, it was the same woman who once told you, “I want a man to make my awm feew wike a piece of cown.”]

Where's the 35-hour week
now that we need it?

Not many years later, I heard futurists talking about essentially the same thing, and the coming of the 35 hour work week. Which also sounded crazy at the time. But that was before computers were commonplace and the Internet was invented. [Note: the 35 hour work week did happen, but in France.] 

In retrospect, maybe a 35-hour week isn’t such a bad idea. And maybe it would be even better if it were a 24-hour work week. 

Think of it. With the work week cut nearly in half, we’d be able to re-employ millions of unemployed Americans,  – doing part of the jobs that currently are being done by only one overworked person, not two with bearable work loads. The new work force might include students, just out of school and carrying hefty college loan obligations, who presently can’t find work even as Starbucks baristas. And it might include laid-off Americans in their 50s and early 60s, who are deemed “too old” by human resources hacks to be re-employable, even though some in Congress want to raise the retirement age to 68, or 70, or worse.

But wouldn’t a 25- or 35-hour work week that mean a huge slash in productivity per worker? And if so, how would the loss get paid for?

Yes, it would mean a big productivity cut. And how to pay for it is indeed a big question.

I was scratching my head over that one, until the proxy vote solicitations for the stocks in my retirement funds started coming in the mail. They asked me for  my "advisory" vote (meaning they'll just ignore it) on, among other things, how senior officers get paid.

How the money for shorter work weeks
gets siphoned off by senior corporate officers

One CEO makes a $2,000,000 salary which represents 20 percent of his earnings, which come to slightly in excess of $10,000,000 a year (That's ten million bucks. A year.) when bonuses, stock grants, options, retirement benefits, and other perks from “financial planning” to airplanes get factored in. Another one makes only $1.5 million in salary, but gets $50,000,000 a year in extra "incentives" – and on, and on, CEO after CEO, ad nauseum.

And you thought you’d be well off, if only you could win the big Powerball lottery?

Then there are the presidents, executive vice-presidents, chief financial officers and other C-suite officers, themselves pulling down annual remuneration in the multu-millions. Why?

"Retain" shmetain

The corporate proxy statements always say the nearly obscene pay is necessary to “attract and retain talent.” Talent for what? For firing people, shipping jobs overseas, or simply not rocking the boat? Real talent doesn’t demand that kind of money. Can you imagine the late Steve Jobs refusing to get out of bed because he wasn’t permitted to earn over, say, $300,000 a year? Or Thomas Edison, a century before him? Hey, when you can get a five-star general to risk his life on the battlefield for relative peanuts, not to mention a a private in our volunteer army, why do CEOs need ten, or twenty, or fifty million bucks a year before they can haul their sorry posterior fundaments out of bed.

"Align" shmalign

Almost always, the proxy statements, or I prefer to call them misstatements, will say the staggering bonuses and other "performance awards" are necessary “to align the interest of the CEO with the interests of the stockholders.” That is a lie because if a CEO or other senior officer is not working in a way that is in the interests of the stockholders, he ought to get dumped, same as he himself will dump a $15-an-hour peon who is not acting in the interests of the stockholders.

Remember, all the money that is going into the overpaid officers’ pockets would otherwise, under current laws, either go to the stockholders (that’s real stockholder interests) or get reinvested in growing the company and hiring more and better employees.

The truth is, most real talent – the talent that richly deserves to get rich – isn’t doing it for the money. They’re doing it for the emotional, and aesthetic, and popular feedback. Or for because they’re pushed by an unexplainable internal drive to make a company better, make it more beautiful, make it more functional, make the world change. Or just the urge to be the boss.

Bought consultants
Alas, “impartial consultants,” who are paid only with the direct or implicit approval of the CEO, who nearly always also chairs the Board of Directors...These consultants get hired to determine what the CEO's salary should be. And unless executive salaries continually escalate, the consultants will quickly be out of work. So guess what’s going to happen to executive salaries, year, after year, after year? And guess whose pay check or dividend check the money is coming out of?

On the other hand, if we had a law that either limited executive salaries, bonuses, stock awards and fringe benefits or taxed away every penny after the half million dollar mark, there’d be a lot more money to pour into new jobs while shortening the work week. And that would plow a lot more money into the economy, instead of letting it sit in some Fortune 500 CEO’s bank account. Which would mean prosperity for all. Or nearly all.

Don’t just redistribute the wealth. Redistribute the work, too.

1 comment:

JoyfulA said...

I remember that era. My classmate went on to earn a master's in Recreation Counseling, to help all these people figure out what to do with all the time on their hands.

Talk about worthless majors!