‘Walmart’s Worst Nightmare’ Is Expanding Massively

This is definitely a good company to keep an eye on, especially as it continues to expand across the west coast (and hopefully beyond). WinCo is employee owned and managed, and offers generous pension and healthcare benefits even to part-timers — all this while managing to offer lower costs to consumers than even infamously exploitative Walmart. Hopefully this model catches on. Read more about it on Forbes.

The Plight of Restaurants Workers

Throughout the recession and subsequent recovery, one of the few job opportunities that have remained largely unaffected, if not growing, has been food service. From eateries to fast-food chains, this broad industry has gained an impressive 30 percent in employment since 1990, accounting for nearly one out of ten private-sector jobs in the U.S.

Unfortunately, a recent report by the Economic Policy Institute exposes some very disquieting things about one of America’s fastest-growing employers. Here are some of the highlights courtesy of Mother Jones:

The industry’s wages have stagnated at an extremely low level. Restaurant workers’ median wage stands at $10 per hour, tips included—and hasn’t budged, in inflation-adjusted terms, since 2000. For nonrestaurant US workers, the median hourly wage is $18. That means the median restaurant worker makes 44 percent less than other workers. Benefits are also rare—just 14.4 percent of restaurant workers have employer-sponsored health insurance and 8.4 percent have pensions, vs. 48.7 percent and 41.8 percent, respectively, for other workers.

 

Unionization rates are minuscule. Presumably, it would be more difficult to keep wages throttled at such a low level if restaurant workers could bargain collectively. But just 1.8 percent of restaurant workers belong to unions, about one-seventh of the rate for nonrestaurant workers. Restaurant workers who do belong to unions are much more likely to have benefits than their nonunion peers.

 

As a result, the people who prepare and serve you food are pretty likely to live in poverty. The overall poverty rate stands at 6.3 percent. For restaurant workers, the rate is 16.7 percent. For families, researchers often look at twice the poverty threshold as proxy for what it takes to make ends meet, EPI reports. More than 40 percent of restaurant workers live below twice the poverty line—that’s double the rate of non-restaurant workers.

 

Opportunity for advancement is pretty limited. I was surprised to learn that for every single occupation with restaurants—from dishwashers to chefs to managers—the median hourly wage is much less than the national average of $18. The highest paid occupation is manager, with a median hourly wage of $15.42. The lowest is “cashiers and counter attendants” (median wage: $8.23), while the most prevalent of restaurant workers, waiters and waitresses, who make up nearly a quarter of the industry’s workforce, make a median wage of just $10.15. The one that has gained the most glory in recent years, “chefs and head cooks,” offers a median wage of just $12.34.

 

Industry occupations are highly skewed along gender and race lines. Higher-paid occupations are more likely to be held by men—chefs, cooks, and managers, for example, are 86 percent, 73 percent, and 53 percent male, respectively. Lower-paid positions tend to be dominated by women: for example, host and hostess (84.9 percent female), cashiers and counter attendants (75.1 percent), and waiters and waitresses (70.8 percent). I took up this topic in a piece on the vexed gender politics of culinary prestige last year. Meanwhile, “blacks are disproportionately likely to be cashiers/counter attendants, the lowest-paid occupation in the industry,” while “Hispanics are disproportionately likely to be dishwashers, dining room attendants, or cooks, also relatively low-paid occupations,” the report found.

 

Restaurants lean heavily on the most disempowered workers of all—undocumented immigrants. Overall, 15.7 percent of US restaurant workers are undocumented, nearly twice the rate for non-restaurant sectors. Fully a third of dishwashers, nearly 30 percent of non-chef cooks, and more than a quarter of bussers are undocumented, the report found. So a huge swath of the people who feed you pay payroll taxes and sales taxes yet don’t receive the rights of citizenship.

All of this reflects a rather disturbing overall trend in the U.S. economy: the loss of stable, well-paying jobs to less secure, low-wage ones. Not only has job growth not kept pace with the needs of the labor force, but the relatively few options that remain share largely the same characteristics: meager pay, little to no benefits, no paid sick leave, poor upward mobility, and so on. And since this has become standard across the industry — baring only a few examples — most companies have little incentive to offer anything better to their workers — in essence, it is a race to the bottom, one that desperate workers of all ages have no choice but to take up.

Needless to say, this is not a sustainable model for prosperity. Not only do individual employees suffer, but so do their families and communities (the poorest of which often have few options beyond food service and equally low-paying retail). The national economy as a whole cannot thrive when such a large chunk of its consumer base is too poor to afford goods and services, or too unhealthy and demoralized to work at optimal productivity. These highly profitable employers have as much an interest in investing more in their labor force as the workers themselves.

For its part, the EPI report suggests legislative solutions, including a  higher minimum wage, mandated paid sick leave, and a path to legal status for undocumented workers. I would add unionization or some sort of labor collective as a big step, too. For its part, MoJo recommends that those wishing to learn more about the working conditions in America’s food industry read the 2013 book Behind the Kitchen Door by Saru Jayaraman.

As fast-food, retail, and other service work continues to take the place of increasingly obsolete but better-paying positions, we need to start adjusting the way we value such labor; otherwise, unpleasant, beggaring jobs will be the new normal, and that cannot last.

 
 

Fighting For a Four-Hour Workday

It used to be common sense that advances in technology would bring more leisure time. “If every man and woman would work for four hours each day on something useful,” Benjamin Franklin assumed, “that labor would produce sufficient to procure all the necessaries and comforts of life.” Science fiction has tended to consider a future with shorter hours to be all but an axiom. Edward Bellamy’s 1888 best seller Looking Backward describes a year 2000 in which people do their jobs for about four to eight hours, with less attractive tasks requiring less time. In the universe of Star Trek, work is done for personal development, not material necessity. In Wall-E, robots do everything, and humans have become inert blobs lying on levitating sofas.

During the heat of the fight for the eight-hour day in the 1930s, the Industrial Workers of the World were already making cartoon handbills for what they considered the next great horizon: a four-hour day, a four-day week, and a wage people can live on. “Why not?” the IWW propaganda asked.

It’s a good question. A four-hour workday with a livable wage could solve a lot of our most nagging problems. If everyone worked fewer hours, for instance, there would be more jobs for the unemployed to fill. The economy wouldn’t be able to produce quite as much, which means it wouldn’t be able to pollute as much, either; rich countries where people work fewer hours tend to have lower carbon footprints. Less work would leave plenty of time for family and for child care, ending the agony over “work-life balance.” Gone would be the plague of overwork, which increases the risk of heart disease, diabetes, and Alzheimer’s.

Benjamin Kline Hunnicutt, a historian at the University of Iowa, has devoted his career to undoing the “nationwide amnesia” about what used to constitute the American dream of increasing leisure—the Puritans’ beloved Sabbath, the freedom to ramble that Walt Whitman called “higher progress,” the Big Rock Candy Mountain. Hunnicutt’s latest book, Free Time, traces how this dream went from being thought of as a technological inevitability, to becoming the chief demand in a century of labor struggles, to disappearing in the present dystopia where work threatens to invade every hour of our lives.

—  Nathan SchneiderWho Stole the Four-Hour Workday?

The Plight of Cacao Farmers

Note: Sorry if this piece is a bit disjointed. I had the ultimate nightmare scenario of my computer crashing before I could save it, so my write-up is lacking in the punch of the original. Ah well. 

As I’ve long observed, it seems that there is no commodity or service we enjoy that isn’t tinged with exploitation and inequality (often as far away and invisible from us as possible). Chocolate, like most exotic agricultural products, is of course no exception.

A viral video from Metropolis, a Dutch filmmaking collective, depicts this harsh reality in a bittersweet way, showing farmers from the Ivory Coast, a major supplier of cacao, trying the final product for the very first time (indeed, some of them had never even heard of it).

Though first uploaded on YouTube in February, the video only recently started making the roads online and through media. Even NPR picked up the story, offering a grim summary:

“Frankly, I do not know what one makes from cocoa beans,” farmer N’Da Alphonse tells Selay Marius Kouassi, a reporter for Metropolis, an international news website. He’s heard it’s turned into food, but he’s never tried it. That’s because chocolate isn’t easy to find in Ivory Coast, and when it is, it’s sold for around $2.70 — a third of what a farmer like Alphonse makes in a day.

But when Alphonse tries chocolate, he immediately gets why people the world over are buying it. “Ooh! It’s nice … and very sweet!” he exclaims. He and Kouassi speed off on a motorbike to share it with other cacao farmers and the young men who help him on his plantation. “This is why white people are so healthy,” Alphonse tells the other farmers as they pass a chocolate bar around a circle.

This testifies to the fundamental human disconnect that characterizes today’s global supply chain. Those at the bottom do not even know why or who they toil for; conversely, those at the top — not to mention consumers of the final product — typically have little knowledge or concern about how or where the products are sourced. It’s a fragmented and dehumanized process from start to finish.

The NPR piece also offers some perspective on cacao cultivation in the Ivory Coast.

More than a third of the world’s cocoa comes from Ivory Coast; it produces more than any other country in the world. But most of the farmers are small producers like Alphonse, cultivating less than 12 acres and struggling to survive. He’s supporting 15 family members on $9.40 a day.

Some of the Ivory Coast cacao workers are even children. As we reported in 2011, child labor is a persistent problem in the West African cocoa industry.

What’s also fascinating is that cacao clearly isn’t a traditional food in Ivory Coast — it’s a commodity crop. And it takes a lot of work to turn those bitter cacao beans into something as delicious as a chocolate bar.

The Mesoamericans first invented chocolate but consumed it as a drink. It took several centuries for humans to figure out how to ferment, roast and process the beans to turn them into cocoa. And eventually we figured out that adding sugar and cocoa butter was the winning combination for those melt-in-your-mouth bars that have ballooned into a $110 billion a year industry.

Many, many cacao farmers like Alphonse (and not just in West Africa) reap practically nothing from their participation in the cocoa supply chain while retailers and companies like Mars and Nestle are pulling in the billions selling chocolate bars.

Sadly, this is a very familiar, if not routine, story. From coffee to T-shirts to the most cutting-edge smartphones, almost every commodity comes at a great human toll. Companies reap billions while the integral contributors to their bottom line are scarcely acknowledged, much less given better working conditions and living wages.

As an informative slideshow from CNN reveals, the majority of cacao comes from poor or developing countries in Sub-Saharan Africa, Latin America, and Southeast Asia, where farmers earn no more than three percent of the final price — compared to 43 percent for retailers and supermarkets. Again, this is a very similar arrangement for numerous other goods.

It goes without saying that there is no justifying beggaring impoverished farmers while reaping in billions. While many entrepreneurs are thankfully aiming to be more socially responsible in their acquisition of cacao, their well-intentioned efforts are but a drop in the bucket for this massive industry. We would need nothing short of a paradigm shift in the way we conduct economic activity, especially with regards to foreign workers in poorer, far off nations. It should not be the norm for profitable companies to employ people too poor and disregarded to even know the fruits of their labor, much less be able to enjoy it.

 

The Worst Places To Be A Worker

Labor rights are among the newest group of legal and human rights conceptualized in history. The ability to join a union and engage in collective bargaining with employers is something we all take for granted — it wasn’t all that long ago that workers throughout the industrialized world fought and often tied for such basic freedoms, and to this day many continue to do so.

In fact, if the results of the Global Rights Index is any indication, there is still a long fight ahead. Conducted by the the International Trade Union Confederation (ITUC), a labor rights alliance, this comprehensive study examines the state of workers’ rights in 139 countries based on 97 indicators, such as the ability to join unions, access due process ,and receive legal protection. Nations are ranked one a scale of 1 (best) to 5 (worst).

As PolicyMic reported, the conclusions are a mixed bag, with a plurality of nations being difficult places for workers to organize:

Among the countries with the best rating were Uruguay, Togo, Sweden, South Africa and Slovakia. Some countries received such poor assessments that they actually went off the scale: Central African Republic, Libya, Palestine, Somalia, South Sudan, Sudan, Syria and Ukraine had the dubious distinction of being awarded a 5+ rating.

As for the U.S., it received a lowly 4 for weak union rights and uneven collective bargaining.

“Countries such as Denmark and Uruguay led the way through their strong labour laws, but perhaps surprisingly, the likes of Greece, the United States and Hong Kong, lagged behind,” ITUC general secretary Sharan Burrow wrote. “A country’s level of development proved to be a poor indicator of whether it respected basic rights to bargain collectively, strike for decent conditions, or simply join a union at all.”

As the following map shows, the worst places to be a worker include China and India — large, poor, and corrupt countries that each have the largest labor forces in the world — and major conflict zones such as the Middle East and North Africa. Unsurprisingly, the more authoritarian and unstable a country, the least likely it is to have a high score (which often goes the same for other rights too).

 

For a developed country, the U.S. scores poorly, with its second-worst numbered score placing it in the ranks of  Thailand, Sierra Leone, Peru and Panama. In comparison, the best rated countries — unsurprisingly — were Western European countries like France, Germany, Belgium and the Netherlands.

The ITUC’s report couldn’t have come at a more topical time, as the issue of workers’ rights continues to gain media and academic attention. It was only last week that workers in over 150 U.S. cities and 30 countries staged the biggest fast-food strike in history, bringing attention to low wages, sparse benefits, and poor treatment (such as inflexible hours and no sick days).

Sure enough, the ITUC also found that the act of striking — one of the most common forms of  addressing employment grievances — was also the most frequently violated right in the past year.

Courtesy of ITUC and PolicyMic

America’s poor rating is particularly concerning to me, not only as an American citizen and resident, but also for the fact that the U.S. remains very influential in promoting economic and business policies abroad. As the study points out, the U.S.’s relatively high level of development has yet to amount to better conditions for workers. While America remains a rich country (and still the richest by a wide margin) it also has the largest poverty rate of any comparably developed nation (as the article notes, it doesn’t bode well for the U.S. to match up to Sierra Leone in a human rights issue).

Similarly, corporate profits continue to soar while the average worker faces wage stagnation, longer work hours, and poorer working conditions. The contradictions inherent in this report and similar observations — that the U.S. developed but still poor, economically vibrant as a whole but financially stagnant across classes, nominally democratic but lacking in workers’ rights — speaks to the unsustainable nature of this system.

Of course, this is an increasingly global problem, one that is being felt far worse in the parts of the world that are most becoming prominent in the global economy, such as China and India. As global inequality rises and production shifts to oppressed third-world workers, will we soon reach a breaking point? We’ve already seen history’s largest fast-food strike thus far. What else is in store for workers and the global economy?

 

Happy Labor Day

More than anything, civilization is arguably the product of generations of nameless laborers. Everything around us, which we take for granted, came from the blood and sweat of innumerable strangers risking their lives to literally build a better society.

To this day, much of what we need and enjoy comes from the unseen and distant toil of millions of laborers around the world, including the underappreciated but integral workers in our own communities.

While we focus on all the great visionaries, leaders, and innovators who have helped guide and improve human civilization, we shouldn’t neglect the army of common folks who helped make their contributions a reality.

What’s Your Labor Worth?

I’ve begun reading more about other economic theories and systems, including the Austrian School, Marxism, and Developmentalism. It’s fascinating to see all the various observations and approaches concerning social and economic dynamics that we take for granted. I can see why all these ideas are so controversial, given the established paradigms they challenge.

Marxism Today

Are you paid what your labor is worth?

I asked this question with a group of friends and got a variety of answers – “yes, but… yes, if…. not even close… depends on how you look at it…  compared to my last job…”

Then I asked a harder question “how do you know how much your labor is worth?”  This really gave them pause.  Nobody really knew how to figure that out.  We ended up with comparing to other people or to other jobs, but neither of those answers seemed satisfactory.

  • If you are consistently underpaid then comparing to other jobs you’ve had doesn’t give you the real value of your labor.
  • Comparing to other people was just too hard to do for the vast majority of jobs today – there are too many components to doing a job well and people don’t necessarily agree on them – so how…

View original post 696 more words

The United States And Vacation Time

According to a report by the Center for Economic and Policy Research, as reported in HuffPo, the United States is the only developed country in the world that doesn’t guarantee its workers either paid vacation or holidays — rather, it’s left up to the discretion of individual businesses.

As the second chart shows, in the United States, better-paid and full-time workers typically get vacation, while low-wage and part-time laborers less often do. In other words, the disparity in paid vacations is becoming yet another symptom of growing socioeconomic inequality.

Interestingly, many of these countries rank as high, if not higher, than the US in metrics of economic freedom and economic competitiveness (according to sources such as the World Economic Forum, The Economist Intelligence Unit, and the Heritage Foundation).

Even if some of these nations fall behind in certain economic indicators,  all of them are economically free enough to rank high in development and standard of living — in essence, its balance between economic freedom and leisure, in which a bit of the former is traded off for more of the latter.

Regardless, mandatory paid leave does not, in itself, appear to be as detrimental to business or economic freedom as is commonly argued. A wide range of factors are involved, and many countries compensate for such “anti-business” policies through other means (for example, corporate taxes in nations like Ireland and New Zealand are among the lowest in the world, while the Scandinavian nations invest heavily in infrastructure, education, and other externalities which enhance economic activitiy).

Of course, sociocultural influences can’t be ignored: some socieities simply place more importance on work (or leisure) than others. Even so, does that alone explain why the US is the sole outlier among all industralized democracies? Is our culture really that distinct when it comes to work ethic and attitudes towards business? Or is it that Americans, who likely appreciate free time as much as anyone else, simply lack the leverage to press for it? Maybe many of us have become convinced that mandatory paid vacations are too damaging to the economy.

Thoughts?

 

What Makes Us Feel Good About Our Work

This great TED Talk by researcher Dan Ariely explores a topic that is no doubt dear to all our hearts: how can we better enjoy the work we do, whether its part of a paying job or free time? What motivates us to drudge on with activities that constitute a huge chunk of our time awake? It’s a pretty interesting video that challenges a lot of assumptions, although some might find the conclusion to be rather intuitive.

Let me know what you think in the comments section below.

 

 

An Interesting Interview With Noam Chomsky

Slate had a  long and informative interview with Noam Chomsky some time back, and I’ve been meaning to share it. He covers a lot ground, including the future of the labor movement, the problems with our current political and economic system, and the pernicious influence of the media. I can’t share everything here, but the following are some of the highlights that stood out for me (I strongly encourage you to read the rest).

LF: Worker co-ops are a growing movement. One question that I hear is  — will change come from changing ownership if you don’t change the profit paradigm?

NC: It’s a little like asking if shareholder voting is a good idea, or the Buffet rule is a good idea. Yes, it’s a good step, a small step. Worker ownership within a state capitalist, semi-market system is better than private ownership but it has inherent problems. Markets have well-known inherent inefficiencies. They’re very destructive.  The obvious one, in a market system, in a really functioning one, whoever’s making the decisions doesn’t pay attention to what are called externalities, effects on others. I sell you a car, if our eyes are open we’ll make a good deal for ourselves but we’re not asking how it’s going to affect her [over there.] It will, there’ll be more congestion, gas prices will go up, there will be environmental effects and that multiplies over the whole population. Well, that’s very serious.

Take a look at the financial crisis. Ever since the New Deal regulation was essentially dismantled, there have been regular financial crises and one of the fundamental reasons, it’s understood, is that the CEO of Goldman Sachs or CitiGroup does not pay attention to what’s called systemic risk. Maybe you make a risky transaction and you cover your own potential losses, but you don’t take into account the fact that if it crashes it may crash the entire system.  Which is what a financial crash is.

The much more serious example of this is environmental impacts. In the case of financial institutions when they crash, the taxpayer comes to the rescue, but if you destroy the environment no one is going to come to the rescue…

LF: So it sounds as if you might support something like the Cleveland model where the ownership of the company is actually held by members of the community as well as the workers…

NC: That’s a step forward but you also have to get beyond that to dismantle the system of production for profit rather than production for use. That means dismantling at least large parts of market systems. Take the most advanced case: Mondragon. It’s worker owned, it’s not worker managed, although the management does come from the workforce often, but it’s in a market system and they still exploit workers in South America, and they do things that are harmful to the society as a whole and they have no choice. If you’re in a system where you must make profit in order to survive. You are compelled to ignore negative externalities, effects on others.

Markets also have a very bad psychological effect. They drive people to a conception of themselves and society in which you’re only after your own good, not the good of others and that’s extremely harmful.

LF: But they sort of give us a clock. If change hasn’t happened in ten minutes, it’s not going to happen.

NC: Well that’s a technique of indoctrination. That’s something I learned from my own experience. There was once an interview with Jeff Greenfield in which he was asked why I was never asked onto Nightline.  He gave a good answer. He said the main reason was that I lacked concision. I had never heard that word before. You have to have concision. You have to say something brief between two commercials.

What can you say that’s brief between two commercials? I can say Iran is a terrible state. I don’t need any evidence. I can say Ghaddaffi carries out terror.  Suppose I try to say the US carries out terror, in fact it’s one of the leading terrorist states in the world. You can’t say that between commercials. People rightly want to know what do you mean. They’ve never heard that before. Then you have to explain. You have to give background. That’s exactly what’s cut out. Concision is a technique of propaganda. It ensures you cannot do anything except repeat clichés, the standard doctrine, or sound like a lunatic.

LF: What about media’s conception of power? Who has it, who doesn’t have it and what’s our role if we’re not say, president or CEO.

NC: Well, not just the media but pretty much true of academic world, the picture is we the leading democracy in the world, the beacon of freedom and rights and democracy. The fact that democratic participation here is extremely marginal, doesn’t enter [the media story.]  The media will condemn the elections in Iran, rightly, because the candidates have to be vetted by the clerics. But they won’t point out that in the United States [candidates] have to be vetted by high concentrations of private capital. You can’t run in an election unless you can collect millions of dollars.

One interesting case is right now. This happens to be the 50th anniversary of the US invasion of South Vietnam – the worst atrocity in the post war period. Killed millions of people, destroyed four countries, total horror story. Not a word. It didn’t happen because “we” did it. So it didn’t happen.

Take 9-11. That means something in the United States. The “world changed” after 9-11. Well, do a slight thought experiment. Suppose that on 9-11 the planes had bombed the White House… suppose they’d killed the president, established a military dictatorship, quickly killed thousands, tortured tens of thousands more, set up a major international terror center that was carrying out assassinations, overthrowing governments all over the place, installing other dictatorships, and drove the country into one of the worst depressions in its history and had to call on the state to bail them out. Suppose that had happened? It did happen. On the first 9-11 in 1973.  Except we were responsible for it, so it didn’t happen. That’s Allende’s Chile. You can’t imagine the media talking about this.

And you can generalize it broadly. The same is pretty much true of scholarship – except for on the fringes – it’s certainly true of the mainstream of the academic world.  In some respects critique of the media is a bit misleading [because they’re not alone among institutions of influence] and of course, they closely interact.