Dear Dirty America


Nothing Can Be Won from Beggars

June 01
19:04 2012
Los Angeles

Robert Reich makes the point:

Corporate profits are healthy largely because companies have found ways to keep payrolls down — substituting lower-paid contract workers, outsourcing abroad, using computers and new software applications. But that’s exactly the problem. In paring their payrolls, they’re paring their customers.

Nothing can be won from beggars. At some point, the wealth has to be redistributed for the financial game to continue.

This paragraph from Reich’s latest article on today’s startling jobs report sheds light onto something I’ve been uppity about for years. It’s this corporate cancer we have infecting the national lymph nodes of our deep societal body.

As mega retailers and department stores outsource American jobs to places like Indonesia and China, they are eventually bankrupting themselves. But that takes time. At first, it’s good for the corporation to outsource jobs, invest in new technology, and find cheaper labor and cut corners wherever they can, because overall they can offer cheaper prices for their goods. They don’t care about a family losing their income, or losing their home. Cutting jobs, or outsourcing labor is just good business practice. It’s pragmatic. It’s American. It means lower prices.

That means the majority of Americans will shop at those corporate box stores, such as Wal-Mart. But over time, as we get used to the dangerously low prices, we refuse to pay more for those same household necessities, like toilet paper, soap, and other banal every day items. Yet, very few consumers realize it’s that deceptive pleasure of paying next to nothing for our groceries and staple items, and getting cheap deals on even bigger purchases like electronics and automobile parts that is inherently self-destructive.

Corporations will go on cutting jobs in order to keep the prices at the same level, so they can keep the enormous crowds of shoppers. As more and more Americans lose their jobs, there is less money to be spent, and those who still have jobs remain in fear of losing them, and they hold on to their money more than they would if the economy was in a rosier state.

Those families feeling the pinch of fewer working hours available, or slashed wages will shop for even cheaper items, and start giving their business to corporate stores, and begin neglecting other businesses who simply cannot offer goods at such low prices.

While stores like Wal-Mart suddenly get more business from folks who wouldn’t have shopped there before, eventually, the big box stores get fewer items purchased from their shelves. As the economy continues to tailspin, people put their own austerity measures into place, and refuse to purchase extra.

In turn, the corporation cuts more jobs, or cuts hours from their employees’ work weeks. And suddenly there is even less money to be spent. Don’t feel bad for the successful corporation, though. Corporate America is sitting on tons of cash. But they won’t spend it to hire new workers because consumers are continuing to buy less. Everything begins to slide in decline. Eventually, it won’t matter how cheap Wal-Mart or Target can offer their goods. There just won’t be that many customers. There won’t be enough cash from the bottom up.

It’s like that vibrant Marx footnote in Capital Vol 1, where Pinto, the Pindar of the Amsterdam Stock Exchange, says:

“Trade is a game and nothing can be won from beggars. If one won everything from everybody for long, it would be necessary to give back voluntarily the greater part of the profit in order to begin the game again” (Penguin, 251).

So, the majority of us might as well come out with our hands up. You won, corporate America. You snatched all the wealth out from under us. We thought we were getting cool products and great deals, but ultimately our society has crumbled beneath your deception. You’re going to have to give a lot of it back to start the game over again. Otherwise we’ll have to take it back. A society cannot have a twenty percent unemployment rate, or tens of millions of desperate, hopeless, wayward citizens without any hope of work or a decent paycheck.

The snake eats its own tail out of desperation. It starts with the tip of the tail. And then up farther. It hopes it won’t get to its own head. But in this kind of self-destructive cycle, it will consume itself. As Reich so aptly puts it, “In paring their payrolls, they’re paring their customers.”

See also, LA job fair a bust, and the elite must stop living off the labor of the masses

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