Welcome MSR readers,
We publish a PRINT magazine, The Main Street Rag, and also produce a monthly newsletter. In the magazine, Editor M. Scott Douglass has a space called The Back Seat where he posts his commentaries. In the newsletter a similar space is called Two Cents (and some change). From time to time, we will post offerings from one of these sources, but we do not refresh this page on a regular basis. Why? For one thing our newsletter is by subscription-only and our print magazine, well, it costs money to produce. It doesn't make sense to give the contents away free, then expect prospective readers to buy copies.So, if readers want to read the editor's words (along with our literary content), copies of The Main Street Rag are available in the MSR Online Bookstore. If you would like to receive Two Cents (and some Change) as part of our monthly e-newsletter, it is free. All you need to do is request being added to our newsletter submission list is email the editor, ask to receive it, give the email address you would like to use (college servers sometimes block these kinds of things, so a personal email address is best) and your location (state or country). For details about our email newsletter: The MSR Monthly Newsletter.
Excerpted from The Back Seat section of the current issue of The Main Street Rag (Winter 2011/2012):
Political Theatre
I write on the eve of the Iowa Caucuses, January 2, my birthday. As I’ve written both here and in my monthly commentary section of the MSR Monthly Newsletter “Two Cents (& some change)” I think this election cycle is more about the make-up of the electorate than it is about the candidates. I just heard Ron Paul say he thinks he is main stream and all I could think as I sat here in my very conservative residential neighborhood was, “That stream don’t flow through here.”
But that’s what every politician thinks. They surround themselves with like-minded people. They set up speaking events where the only people who show up are the people who already agree with them. In some cases, people with opposing opinions are banned. How can they help but believe that they are Main Stream America?
The flaw in our electoral system is that we can’t possibly elect a main stream candidate when so many diverse and extreme contenders consider themselves main stream based on the fact that they have a small, but ardent group of followers telling them so. Right now Mitt Romney is leading the pack in Iowa with an estimated 25% of the votes. That means he may well win this state while 75% of the people voting oppose him. Does that sound logical? Does that sound like the best way to choose a candidate?
All that aside, I think the real issue in American politics is Congress. With an 8% approval rating some of the freshman class STILL BELIEVE they have a mandate to Just Say No. Last night on 60 Minutes Eric Cantor actually said—and I’m sure he believes—that he was willing to adjust his position (he could not bring himself to say the word compromise); that the President was the one who wasn’t willing to negotiate. But every action he has taken so far has demonstrated that the only area where there is room for compromise is if the other side does it.
It’s this rigidity and the apparent blindness to it that is preventing anything from getting done. In my mind, the only way to fix America is to get rid of EVERYONE in Congress and start over, but with so many folks with extreme positions thinking they are the real Americans, where do you find a candidate who is capable of winning an election AND working with others to get something done? That’s the question we should be asking before we step into the voting booth this year.
Depreciating Values
I’m a business person. I didn’t start out that way. I spent more than half of my working life working for others. I base the way I conduct business on what I perceive to be short-comings of the people for whom I’ve worked over the years. The most prevalent flaw in my mind has always been how they value those who work for them.
In almost all work environments in America, someone decides the value of a person who works as a subordinate. In the corporate world, it’s been a tiered or pyramid design: a broad base of production workers followed by a smaller level of sales, marketing, distribution, research & development, and tech support (among other jobs), followed by a level of managers, maybe another level of managers’ managers and so on up to the top.
You would think that, given this design, the higher operational expenses are toward the bottom. That used to be true. Then people like Mitt Romney and his consulting company, Bain & Company, recognized a way to flip the earnings pyramid. By devaluing the production end they could ship it overseas, cut that level’s expense in half and shift the savings up the pyramid.
Of course, this was good for the people at the top and for the people at Bain, but what about the workers whose jobs were eliminated? What about the customer? Did the decreased cost of doing business result in any savings for the customer?
In most cases, I would argue it did not. No one really cuts their prices in America. Look at the price of oil. The price of crude went up nearly 400% between 9/11/2001 and the beginning of 2011. From right around $40 a barrel to over $150 a barrel. At its peak, we were paying between $4-$5 per gallon of gasoline. The price of a barrel of crude has since receded to under $100 just before the holidays. That’s about a 35% decrease.
And how much did the cost of a gallon of gasoline decrease over that same period? Between 25 and 30%—enough for us to notice, but not equivalent to the decrease in the cost of materials. Why the difference? The industry does what it always does: runs up the cost as a test for what consumers are willing to pay, eats up the profits which are converted to executive bonuses and shareholder dividends, then eases prices down to a new norm. Since we’ve already demonstrated a willingness to pay the higher price, they still look like the good guys, but, in truth, they just shifted wealth from customers to executives and stockholders at a rate that is higher than the market would normally allow. They basically picked our pockets and called it free market when it’s more like fixed market.
Many of these are the same people who are saying that giving tax breaks to the rich will create jobs. No it won’t. Unless of course you’re referring to jobs like maids, gardeners, auto detailers—you know, those jobs we all yearned to have while growing up.
I worked part of the New Year’s holiday weekend to catch up on stuff that should have been done before Christmas. My wife helped me box 800 pounds of books that needed to be shipped to another publisher. If I had done it myself, it would have taken three hours or more and I would have been very sore afterward. At one point, I was teasing her about how much quicker I was at it than she was and she said something like, “I guess I’m not cut out for this kind of work.”
Who is? Who aspires to be a packer at a book production facility—or any facility? No one. Why not? Because someone has decided that it’s not a very valuable job; that it’s not worthy of a living wage. I would argue that it is. In many industries it’s automated, but at a place like Main Street Rag, it’s manual. If not done right, books get damaged and I have to replace them at my expense. If done right and quickly, the cost savings in labor is enormous. I have had others package shipments of this size before. Most are not as fast as I am, but assuming we were being paid the same rate, a job that takes an employee two hours to do, one that I can do in one hour, has cost me twice as much in wages. So, doing it right and quickly saves me money that allows me to control waste and labor costs. Keeping my expenses down allows me to minimize what I charge for the end product.
That’s a first-hand example. The scarier scenario is what goes on every day. I keep going back to the guy who picks up our garbage. This is an unskilled laborer. Locally, the powers that be have turned this over to private contractors because they don’t want these employees on government payroll. As a result, their wages and benefits both went down. The President and every candidate in every race in America have been talking to the value of an education, but I am still waiting for someone to tell me who’s going to pick up the trash if everyone has a Ph.D.
There is no doubt that education is a problem in America. But I would contend that the real reason why we have so few manufacturing jobs left and so many people in prison are related. It’s because we’ve outsourced jobs that could be done here by workers who are not candidates for higher education if we simply shifted the weight salary distribution on our labor pyramid in a way that better values people who work with their hands, who do the jobs most of us would rather not.
I guess that makes me a 99%er. If I must be labeled, I suppose that’s one I can live with.
M. Scott Douglass
Main Street Rag
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