The following post was written by Andy Sorensen, President and Founder of The One Union
Jeff Bezos’s and Amazon made the news recently by raising wages to $15.00 dollars per hour. To hear Jeff tell it, they are now leading the corporate world in paying a decent wage. Of course, they are not leading, the wage was brought about by political and media pressure that highlighted Jeff’s enormous wealth that exceeds $150 billion. Prior to the pay raise, Amazon was spending money and time developing and patenting wristband productivity trackers to squeeze out 100% effort from their low paid workers, not working on paying them more.
We see this raise and the pittance that has been given out during our supposed economic boom as another classic example of the extremely low expectations of the worker. If the minimum wage had kept up with the cost of inflation it would be $19.00 today. If wages such as those of Amazon warehouse workers had kept up with inflation they would be paid $30 dollars an hour today.
Two Key Facts
Let’s just list two facts right here to sum this last paragraph up.
- Raising wages does NOT hurt the economy—it grows the economy as people have more to spend. Expenses do NOT go up in proportion to wages as wages are only a part of the cost of doing business. The Algorithm for creating wealth states that the faster money spins in a community the more wealth is created. The problem is that the money at the top is not building wealth for all and there is not enough money at the bottom to create growth for all.
- Negotiating a cost of living increase is the lowest form of bargaining. This is the last resort in bargaining when workers cannot get a real raise for whatever the stated reasons. They ask for a cost of living increase, to just keep up with inflation. So they don’t go backward.
The average American worker has seen a 10% rise in wages over the last 20 years; ½% per year, while during the same period, inflation has increased by 53.9%. We have done such a poor job representing ourselves that we haven’t even managed to keep up with inflation. Our wages have, in fact, declined.
According to Pew Research Center research:
…After adjusting for inflation, however, today’s average hourly wage has just about the same purchasing power it did in 1978, following a long slide in the 1980s and early 1990s and bumpy, inconsistent growth since then. In fact, in real terms average hourly earnings peaked more than 45 years ago: The $4.03-an-hour rate recorded in January 1973 had the same purchasing power that $23.68 would today.
We Need to Raise Our Expectations
Given that America is supposed to be a shared struggle and prosperity, we should see the same bleak news on the corporate side. Instead, the last 20 years have been the best 20 years for corporate management in the history of the U.S. They have seen their pay increase by 50% year after year totaling a whopping 1000% increase over the same 20 years.
How do you think the CEO would react to being told he would get no raises for years at a time? Well, that doesn’t happen in the CEO world as they have mastered the art of cooperation to make each other prosperous.
Meanwhile back in 99% land, we accept penny raises and its big news when workers that should be paid $30 dollar an hour by now finally reach $15. We have been beaten down for decades and now our expectations are so low that we will take anything we can get.
An Addiction to Money and Power
That sucks, and it is easy to get mad at the One Percent and blame them but that is not going to fix anything. It is helpful to understand that the One Percent or more to the point the .01 percent are completely consumed by their addiction to money and power. Getting the One Percent to give a fair share to the worker and relinquish power is no different than trying to take a needle from a heroin junkie who’s in the process of shooting up, it isn’t going to happen.
An addict’s go-to response is; ‘I want all the drugs, now.” Having some of the drugs is not an option just like having part of the profits is not an option for those consumed by greed.
All a person can do in that situation is tell the person that they are hurting themselves and those around them. Tell them that you can’t be part of their addiction anymore and show them the door.
Let’s examine how this is works in real life. We don’t blame the addict as much as we blame each other. Look at the comments made when any group of workers is trying to get a raise. We tear each other apart. The fast-food worker doesn’t deserve it, the union guy shouldn’t get better benefits, and drivers shouldn’t make more. What it all boils down to is that we are saying; If I can’t get a raise then neither should anyone else.
Why Not Cooperate Like the One Percent?
I propose adopting the strategy of cooperation used by the One percent. We decide to cooperate, support each other, and be prosperous. Doesn’t that sound better than the same failed strategies that have led to the longest wage stagnation in the history of our Country?
Do this and we will present a united front to the One percent in our quest for shared prosperity. We tell them that their addiction to money and power is hurting all of us and that if they choose to continue in their addiction we will be forced to turn them out. Without us to work, shop, and invest, their drug (money!) will quickly evaporate. Oh, they are going to scream bloody murder and have their mouthpieces blaring that the sky is falling.
It is no different than a drunk coming home and terrorizing their family. The solution is to kick the drunk out, not chastise the family.
An addict always chooses all, all the drugs and all the money until the option of all is taken away. When we take the “all” option off the table that is when real negotiations will finally resume, and we can get back to being normal people who are good to each other and share in the prosperity.
This is the silliest and saddest part of this terrible quandary we find ourselves in. The solution is to cooperate and be nice to each other. Do this and prosperity will follow. Isn’t it time to move forward from a scarcity model to an abundant one?
Andy – Founder and President of The One Union