The Corporate OBSESSION with PROFITS is driving down wages

[LSK]

Wall Street has created a Corporate environment that values HIGHER PROFITS over all other things. And eliminating jobs is a key ingredient of higher profits. Stock prices bounce up and down because of GROWTH of Profits.

So what do Corporations do? They export jobs overseas. They outsource. They invest in technology. They all seek ways to eliminate peoples jobs in the USA. All because they seek HIGHER PROFITS so the stockholders have more money.

Is this what the role of an economy should be??? Should PROFITS be the purpose of an economy???

Why shouldnt we value an economy that provides a decent job for its citizens??? Sorry, but America wants nothing to do with that in its economy.

I started reading The European Dream by Jeremy Rifkin. In it he discusses how the USA measures economic growth only in GDP. The GDP does not measure the quality of life and the Europeans are trying to develop a better measure of the economy.

Call this as an attack on capitalism. Call this a cry for socialism. But its the way I see the American business climate.

Profits over people.

[Doctor_J]

1. What was your first clue?

why do you think health care in this country is the worst in the industrialized world? Because insurance companies are beholden to their stockholders instead of their insurees.

[LSK]

3. Health Care is another example

I probably always knew.

[mmonk]

2. Exactly

The drive to the bottom. It's not the immigrant's fault. It's not the union's fault. It's not the American worker's fault. It's not the cost of healthcare's fault. It's the greed and the policies that feed it's fault.

[napi21]

4. There's more to it than that!

I don't know who started it, but some CEO somewhere got the OK on a salary of a couple of million $ a year salary. The CEO of the Corp. on the other side of the street said, well damn, if HE can, then so can I! THAT spread like wildfire throught the Corp. world, and they had to make up that extra compensation somehow!

[LSK]

5. and wheres the government controls looking out for exploited people?

Where is the outrage of society when the salary race of CEOs starts taking a toll on the middle and lower classes?

[napi21]

6. The only ones who can stop this are the Boards of Directors

OR the stockholders! I've had this same argument with quite a few Brokers, and the answer is always the same. The Major stockholders are the wealthy, and probably the same CEO's I'm complaining about! THEY'RE sure not going to complain! If you only own a coupe of hundred shares, it doesn't matter WHAT you say!

[JHB]

22. I can tell you who started it, and when.

Ronald Reagan, and the lowering of the top marginal rate from 70%.

Now, there were always loopholes, but if you tried to just toss another million or ten on your "compensation", Uncle Sam would a serious chunk of it. (So better to maintain control of it as incentives for empoyees.) Suddenly, the economic equation shifted in favor of lining your pockets directly, so screw the ranks & file, give'em the stick!

[LSK]

7. How about laws protecting US workers?

[rwenos]

8. Corporate Rapists

After about 12 years of working as a running dog (!) for various insurance companies, I finally got downsized about 18 months ago. The corporate guys who made the call threw 40 of us out of work, plus 80 more support staff.

For saving about $7 million in annual salary, those guys made AT LEAST $100,000 bonuses each.

That corporation went from 4000 management employees in their corp. HQ to 1,200, in about 18 months.

And they threw themselves a party to congratulate themselves as such great business guys.

Corporate managers HAVE NO SOUL. They have NO GUILT. They have NO HUMANITY. They are the TRUE WHORES of American life.

[progressivebydesign]

9. This has been the decline of our democracy.. the almighty stock market.

Capitalism was a nice experiment... but it doesn't freakin' work.

[Elwood P Dowd]

10. I pointed that out in my thread below that is now locked

In that case, it was a small businessman with 100 employees. I caught hell for the post, but it's the absolute truth. And, I WAS NOT falling for some Karl Rove trick. I was pointing out exactly what these people are doing. They are using the immigrants.

[LSK]

12. i dont believe illegal immigrants is the cause of the problem

They are just a symptom of it. They are taking advantage of the problem. The jobs they are taking are jobs that the middle class could not support themselves on.

[PsN2Wind]

11. And what better way?

to drive down wages than to increase the labor supply. The jobs that can't be sent off-shore, corporations can import the labor to do. Every one wins except the poor bastard that has been struggling to hold on to a marginal job. And who cares about him, certainly not the Repubs and more and more it seems neither do the Democrats.
I'm amazed by the outpouring of empathy for illegals here and the lack of same for citizens and legal residents that will have to compete with those given amnesty for the remaining jobs.

[sandnsea]

13. labor seeks profit too

Labor profits from the sweat of the brow, investors profit from capital. The trick is to get labor to understand that their input is as valuable as the investor so that they will demand a fair return on their investment, labor. All that has happened in the last 25 years is that labor has allowed itself to be abused by the investor, labor believes it owes its success to the investor, instead of recognizing that money doesn't create products or services to sell.

[moondust]

14. Riddle.

If HIGHER PROFITS are EVERYTHING then why aren't stockholders demanding the outsourcing of CEO and other corporate officer jobs? That could save millions! Who the hell is authorizing all these exemptions from the profit motive?

[LSK]

16. because usually the CEO is a majority stockholder

[izzybeans]

15. Yep.

If the wingnuts want the culprit attacking their freedom they need to look at their economy, their debt enslaved economy.

[ProfessorGAC]

17. I Think You Misunderstand Rifkin

First, corporations have ALWAYS been worried about profit. That's their job. The problem appears to be that we have lost any sense of grace about the pursuit of profit, which we rather nicely got passed the first time post-robber baron. Companies in the 40's, 50's, 60's and '70's made healthy profits, lots of folks got rich, and millions had good jobs and consumed massive goods. It worked for everyone. Now, every 0.1% of return is scrutinized by Wall Street analysts who are far less competent for that task than most would believe. Hence gross overreaction by every little tidbit of information with no sense of context.

Now to Rifkin. First the U.S. does NOT only report GDP growth, and the EU does report it too, so it's specious to interpret him that way. The EU and economists over there use the EXACT same statistics that we use here! And, the EU is NOT looking for a way to better measure economic health, in exclusion of those of us in the United States. In fact, that's practically all i've been doing for the last 20+ years. I debunk conventionalism and propose a better way to measure certain elements of economic health. Then i provide my equations and models in journals. So, it's not true that the Europeans are doing a thing differently. I read their journals too. If Rifkin said that, he's wrong. However, i'm prone to think you misintepreted what he wrote, because i think he would no better.
The Professor

[donkeyotay]

18. We've gone full circle. Regulation was born out of the abuses

by capital of labor and the environment. Corporations exist to make money, and one of the government's major jobs became the regulation of that drive. Tortured analogy time: Fire is a useful force, if you confine it to a hearth. It's not so useful if you let it burn down the house. That's what's happened with the "free market" takeover of government, media and most people's thought processes. It's been sold as a panacea, when it really needs to be regulated in order to be useful to the whole of society.

[Odin2005]

19. It's a result of market fetishism by the Right.

The job market is treated like any other market by these bozos, which is disgusting. PEOPLE SHOULD NOT BE COMMODITY, THEY RE NOT CHATTEL! Employees treat workers like just another expense, that is wrong. a worker is an end unto himself/herself, not a means to an end (profit or some lazy, parasitical fat-cat). Workers need to take back the market. The government sould be supporting co-ops as much as it so they can lay the foundations of a market socialist economy.

[Strawman]

20. Bottom line: too few take too much

And they have delegitimized the govt. as the proper agent to rectify this fundamentally unfair arrangement.

Companies have to make profits in our system and if they are public companies they have to make profits that are on par with their competitors to attract/keep investors. If you want to keep the current system and make it fairer, there must be redistributive policies on the back end. If we can't get a fair shake on the front end without killing the goose that laid the golden egg, fine. Give us our due on the back end, otherwise why should most people go along with such an arrangement?

On the front end workers have no power anymore. We're told that labor contracts, protectionism, etc. undermine the ability of the businesses that employ us to stay afloat and competitive. I can accept that argument if it is rectified on the back end by a comprehensive welfare state so that all share in the benefits of our economy that is supposed to be more efficient and productive as a result of lessened wage and job security obligations for businesses on the front end.

Obviously things like environmental protection and worker safety have to happen on the front end, but I could live with back end redistributive policies in terms of wages and benefits.

[dogday]

21. Simple---Rich keep getting Richer while

the poor keep getting poorer... The unrealistic salaries paid to some of these madonnas is ridiculous...

[Nederland]

23. Question

If the US model results in job cuts, why is the US unemployment rate so much lower than Europe's?