Of UPS, Whole Foods, and Our Values as a Society

D. Scott Davis, Chairman and CEO of UPS. UPS 2012 Net Income 4.389Billion. Mr. Davis's total compensation was $12 Million. Average UPS driver pay $58,653, or just over 200 times less than Mr. Davis. (Sources: http://bit.ly/156KXUk and http://jobs.aol.com/articles/2011/06/02/ups-vs-fedex-which-pays-best/)
D. Scott Davis, Chairman and CEO of UPS. UPS 2012 Net Income 4.389Billion. Mr. Davis’s total compensation was $12 Million. Average UPS driver pay $58,653, or just over 200 times less than Mr. Davis. (Sources: http://bit.ly/156KXUk and http://jobs.aol.com/articles/2011/06/02/ups-vs-fedex-which-pays-best/)

UPS is not alone in blaming Obamacare for recent business decisions. In the case of UPS, their decision is to drop benefits for the working spouses of 15,000 white-collar, non-union workers(1). Makes me wonder if fellow white-collar workers are paying attention to the details.

If you’re like me and you try to be a conscientious consumer who makes purchasing decisions that send a message, then here’s a list of other major corporations who are actively opposing the Affordable Care Act(2):

Whole Foods
Papa John’s
Cheesecake Factory
CKE (owner of Hardee’s)
Jimmy John’s

Whom do the above (excluding Boeing and UPS) generally employ and who will be hurt the most if these large and profitable corporations cut back on benefits, reduce workers’ hours, curtail new hiring, and raise prices as their response to the Affordable Care Act?

Hint: It won’t be the senior corporate managers making these decisions, their boards of directors, or the shareholders to whom they answer.

Yes, companies need to be profitable.

Yes, investors need to make attractive returns.

Yes, retirees with 401Ks want to earn as much as they can on their investments (although if you’re a retiree and still in equities I suspect you’re either fairly wealthy and can afford the ‘gamble’ of stocks, or you’re in desperate need of better financial advice).

What we don’t need to do is make money our only measurement of success. The accumulation of wealth without regard for how it’s done should not be held in such a high regard and as one of our society’s core values.

Isn’t it ok to make just a few dollars less profit while you do right by your employees? What kind of person tells their employees that I’m going to cut your hours and blame the Affordable Care Act just so that I can make more money for myself and our shareholders by not offering you employer-subsidized healthcare?

Seriously, isn’t that just a really huge F**K YOU from the rich aimed essentially at all the rest of us ordinary people?

1. The Numbers Behind UPS’s Move to Cut Spousal Health Coverage
2. 7 Corporations That Are Freaking Out About Obamacare

Researchers Finally Replicated Reinhart-Rogoff, and There Are Serious Problems. | Next New Deal

See on Scoop.itDidYouCheckFirst

Greg Russak‘s insight:

“They Pollin of the University of Massachusetts, Amherst> find that three main issues stand out

First, Reinhart and Rogoff selectively exclude years of high debt and average growth. Second, they use a debatable method to weight the countries. Third, there also appears to be a coding error that excludes high-debt and average-growth countries. All three bias in favor of their result, and without them you don’t get their controversial result.”

See on www.nextnewdeal.net

The Worst of Paul Ryan’s Budgets

See on Scoop.itDidYouCheckFirst

President Obama is trying to charm a party that clings to calcified ideas on spending and taxes. Just look at the latest from Representative Paul Ryan.

Greg Russak‘s insight:

Ryan and Romney were soundly beaten. The reasonable conclusion is that their ideals and vision do not have great appeal or support. From the looks of things, Ryan is simply doubling down because that’s what ideologues do. It’s all they know how to do.

See on www.nytimes.com

Class Warfare and John Galt; Both are Fiction

A recent Facebook post by The Christian Left (image courtesy of that post), sparked some interesting discussion. Some people apparently saw this as a metaphor for Obama acting as a messiah while simultaneously dividing the country with his “class warfare” against the rich.

This whole idea of “class warfare” strikes me as being mostly an issue for wealthy conservatives. Even more curious is that it’s become a rallying cry for middle class conservatives who feel compelled to rise to the defense of the wealthy and the threat they face from onerous government intervention and taxation.

Why is that?

Well, it seems to me that there’s no denying that conservative (and GOP) media spokespersons like O’Reilly, Beck, Hannity, Coulter, and that whole crowd are intent on convincing us of the evils of government. Their rhetoric seems focused on protecting their benefactors while simultaneously serving their own greedy self interests by attracting as many eyeballs (and devotees) as possible. Nothing seems to work like some good old hyperbole (devoid to the degree possible of any facts) for riling up the uninformed and for driving wedges between all kinds of people. If it’s not the fake (and worn out) War on Christmas, it’s the new (and just as fake) Battle Royale between Takers and Makers.

(And before conservatives accuse me of bias, let me at least come clean and admit to mine. I am proud to call myself a progressive and a liberal. Yes, similar accusations can be made about the hyperbole from left wing personalities, too. However, and to my experience, at least they seem to be defending us little guys with their rhetoric. They don’t try to scare us into siding with the wealthy in the hopes that someday the wealthy will shower us with generosity in the form of….what?….jobs at Walmart? Oh, and the so-called “liberal media” actually seem to care about and cite real science and actual facts. Bonus points in my book for that sort of behavior.)

Conservative spokespeople from Boehner and McConnell on down through Faux (sorry, Fox) News, The Drudge Report, and tea partiers everywhere would have us all believe that if we don’t stop hating the wealthy and don’t start supporting even more and more concessions – Boehner is actually proposing lowering the tax rates?!? – we’re doomed. They seem to actually think – or more likely, want us to believe – that we in the middle class will actually witness a physical manifestation of the disappearance of “job creators” a la John Galt if the middle class comes out on top in this so-called war of the classes.

In other words, if the middle class triumphs and taxes go up on the wealthy, the wealthy will retreat to points unknown while the rest of us are left standing around wondering from where our next hand out will appear.

For the record, just because I favor raising taxes on all corporate profits, closing all corporate tax loopholes (especially of the offshore variety), and doing away with subsidies to last century’s industries like oil, coal, and natural gas doesn’t mean I hate the wealthy. Oh, and I’m not a socialist. (Ok, I admit it. I am a little on issues such as universal health care and higher education, but that’s for another post.)

And, just because I think the Bush Tax cuts for individuals earning over $250K ought to expire and, frankly, those rates ought to go up a little more, also doesn’t mean that I hate the wealthy. Hell, I’ve spent my entire adult life working pretty hard and taking risks with start-ups – including my own; twice! – to try to be among them. Never once has my tax rate come into the thought process that went into those decisions. Never once have I met a true entrepreneur who said that taxes – especially of the personal income variety – were part of their decision making process for starting a business.

There is no class warfare. It’s imaginary, just like that fictional character in that novel written by a Russian atheist who didn’t know you-know-what from Shinola when it came to economics. There’s nothing to be afraid about. The wealthy are not going to take their marbles and go home if their taxes go up. They aren’t going to curl into fetal positions on beach chairs somewhere and wallow in their hatred of government. They’ll do what they do best; find ways to create more wealth for themselves.

As for those CEOs and business owners who want to make a statement by laying people off or closing up operations because their taxes are too high, I say this. Either they aren’t very bright, they aren’t really entrepreneurs, or they are liars. Only a foolish business person would take such actions if the business was doing well. Business people don’t just walk away from their business. At the very least, they sell it so they can go someplace sunny the rest of their lives and enjoy their prosperity. I hope to join them one day, so long as it’s not as the old guy bringing them fresh towels and cold drinks.

It takes a thriving and prospering middle class to be a thriving and prosperous economy. This is why I’m so absolutely astounded by anyone who isn’t making $250K or more who identifies themselves with the GOP and supports the likes of Boehner, Ryan, Cantor, McConnell and that crowd. Here’s why I say that.

Businesses cannot survive and thrive without customers. Without a strong and consuming middle class, there is no market, businesses won’t prosper, and business people can’t make as much money. Smart politicians and business people understand this, and history has proven that the middle class needs more than some “trickle” coming down from on high in order to grow. Ask the medieval kings how that whole serfdom thing worked for them.

Today, it’s not class warfare. It’s not warfare of any kind. It’s ethics and arithmetic. The wealthy are not paying their fair share. That’s the arithmetic. More than that are the ethics. The wealthy are not paying enough back to society. It’s our society and how economics within it operates, after all, that gives them the environment in which to create, function, and prosper. (No, conservatives, business did not build that.) The wealthy owe a debt back to our society paid in the form of taxes in order to keep our society functioning for this generation of all people and for the next generation of entrepreneurs.

I think that it’s childish, silly, and dangerous for us to believe that Big Money isn’t pulling the strings in DC. Let’s not kid ourselves about which strings they have more of and pull more often. It’s the self-appointed defenders of business. It’s the GOP.

That said, this “war” being waged over taxes on the wealthy and the possibility that they will therefore refuse to magically create jobs if their taxes go up is even sillier and more dangerous. We need to be more mature in our thinking when it comes to politics, policies, regulations, laws, and tax codes that are more progressive and which move to ensure the majority of Americans are not back in the conditions that most average people endured in the Gilded Age.

My grandparents came to America in the great immigration of the early 20th century. My parents were born in America in 1915 and 1925. They told vivid and disturbing stories of what it was like to live under the boot heal of unregulated, under taxed, and wildly powerful Big Money corporations back then. Why today’s middle class thinks we need to return to tax policies and regulatory environments that even come close to those days is beyond my comprehension.

So, I wonder what it will take to get the dwindling middle class in the GOP to stop voting against their own economic self interest?

I wonder if the GOP will ever stop trying to sell us on the fallacy of trickle down economics, and I wonder how many more times we will need to see that economic theory proven wrong before we shunt politicians who espouse it to the sidelines where they belong?

My advice is simple. Let’s do the math, do what’s right, and put ourselves back on a track toward recovery for the vast majority, not the privileged few. Let’s stop pretending that there’s a war between the classes, and let’s stop believing in fiction as a basis for an economy.

Das Kapital Quote Total B.S.

So the following arrives in my inbox….

“Owners of capital will stimulate the working class to buy more and more expensive goods, houses and technology, pushing them to take more and moreexpensive credits, until their debt becomes unbearable. The unpaid debt willlead to bankruptcy of banks, which will have to be nationalized, and theState will have to take the road which will eventually lead to communism”

Karl Marx, Das Kapital, 1867

I was immediately suspicious of this when I saw it. Karl Marx talking about the working class acquiring technology in 1867??!!?? COME ON!!!

So I’m offering this posting to forewarn you should this viral drivel arrive in your inbox.

Consider this most revealing passage from http://meganmcardle.theatlantic.com/archives/2009/01/faux_marx.php

“…no one in 1870 imagined the working class having access to bank credit. Poor people might get some time from the landlord, or a few weeks at the butcher, or they might run arrears and pay on account, but they did not buy substantial goods on credit. The first mass extension of credit to people who did not own land was the boom in installment buying that came in the 1920s.”