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xchrom

(108,903 posts)
Tue Mar 26, 2013, 06:59 AM Mar 2013

Meet the CEO Who Cut Worker Pay in Half While Pulling in $21 Million Last Year

http://www.alternet.org/corporate-accountability-and-workplace/meet-ceo-who-cut-worker-pay-half-while-pulling-21-million

***SNIP

If Drucker were still writing today, he’d likely be even more unforgiving. CEOs these days aren’t just slashing worker jobs to add on to their own rewards. They’re slashing worker pay as well — and no CEO may be benefiting more from shrinking paychecks than Ford chief executive Alan Mulally.

Mulally has restored Ford to profitability, his many business and political admirers never tire of pointing out, without having to take any taxpayer bailout. But Mulally has indeed enjoyed a hefty bailout — from his workers.

Entry-level workers at Ford used to make $28 an hour. That rate fell by half when the auto industry financial crunch first hit five years ago and now sits a bit above $19. And since the crunch all Ford workers, not just entry-level workers, have given up cost-of-living wage adjustments and health benefits.

Auto industry execs have declared these worker concessions as absolutely necessary. Without lower compensation for auto workers, the argument goes, the auto industry would never become “globally competitive.” This same reasoning apparently doesn’t apply to compensation for Ford CEO Mulally.
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Meet the CEO Who Cut Worker Pay in Half While Pulling in $21 Million Last Year (Original Post) xchrom Mar 2013 OP
kr HiPointDem Mar 2013 #1
K&R n/t OneGrassRoot Mar 2013 #2
K&R Sherman A1 Mar 2013 #3
"Austerity for thee, not for me . . ." HughBeaumont Mar 2013 #4
"We're not all in this together." moondust Mar 2013 #8
To "be competitive" ... Puzzler Mar 2013 #5
How is half of 28, 19? trumad Mar 2013 #6
It makes for a better story is my guess madokie Mar 2013 #7
I noted that also. xtraxritical Mar 2013 #66
Raises erpowers Mar 2013 #9
Because the 50% cut was 5 years ago Art_from_Ark Mar 2013 #10
Gotcha trumad Mar 2013 #12
You left a sentence out... we need to know what "that" is bobclark86 Mar 2013 #32
It was cut in half and has now gotten to $19 csziggy Mar 2013 #78
CEOs are the New Royalty Octafish Mar 2013 #11
Is $19 per hour for an entry-level worker really that bad? Nye Bevan Mar 2013 #13
Is $21 million "reasonable" for ... 99Forever Mar 2013 #16
If every company in the US paid entry-level workers $19 per hour, Nye Bevan Mar 2013 #22
No one... 99Forever Mar 2013 #25
+1. IMO, not only do we need a much higher minimum wage, winter is coming Mar 2013 #30
but MANY are actually feasting hfojvt Mar 2013 #36
Way to buy into the fascist bullshit. 99Forever Mar 2013 #38
whatever that means hfojvt Mar 2013 #48
Like crabs in a bucket. 99Forever Mar 2013 #51
yeah I know that one hfojvt Mar 2013 #56
Wrong. 99Forever Mar 2013 #59
oh I know hfojvt Mar 2013 #61
Still wrong. 99Forever Mar 2013 #67
Actually, wages from $25 to $40 an hour do trickle down to the economy at a high rate. haele Mar 2013 #44
1st Rate post Populist_Prole Mar 2013 #49
not really very populist hfojvt Mar 2013 #58
So a wage of $50K a year puts you in the elite? haele Mar 2013 #69
$50,000 a year puts you above about 50% of the rest of the country hfojvt Mar 2013 #72
Deep breath - The benefit is in the taxes and spending that the $50K - $100K does. haele Mar 2013 #74
you just keep repeating the argument for trickle down hfojvt Mar 2013 #75
No I'm making this point because this is part of the research I am doing for my degree. haele Mar 2013 #77
it's certainly not trickle DOWN hfojvt Mar 2013 #79
OK - 95% of my family income going to taxes and local businesses means I'm just like the top 1% haele Mar 2013 #80
swing some more? hfojvt Mar 2013 #81
Swing away - notice that though I tell you the percentage of taxes that come out of my paycheck - haele Mar 2013 #82
Side comment - If you want to know what your vet's life of luxery is, look up kestrel91316 haele Mar 2013 #83
No it isn't... dickensknitter Mar 2013 #18
That's about twice sulphurdunn Mar 2013 #26
sounds pretty darn good to me hfojvt Mar 2013 #33
So....why, out of curiosity... A HERETIC I AM Mar 2013 #57
What is a comfortable living? hfojvt Mar 2013 #60
That is a question only you can answer A HERETIC I AM Mar 2013 #62
except you are not talking about reality hfojvt Mar 2013 #65
So the idea that the person who MAKES the product you are buying BrotherIvan Mar 2013 #40
So, what do you think would be a fair hourly wage for entry-level employees? (nt) Nye Bevan Mar 2013 #41
Here's my answer BrotherIvan Mar 2013 #42
Can't support a family of 4 in the Bay Area. That's right at the poverty level. demosincebirth Mar 2013 #53
When I had an entry-level job in the 1980s I couldn't even afford an apartment of my own. Nye Bevan Mar 2013 #54
This message was self-deleted by its author Tuesday Afternoon Mar 2013 #14
And, I bet this CEO NewJeffCT Mar 2013 #15
Welcome to capitalism. nt TBF Mar 2013 #17
Message auto-removed setab Mar 2013 #19
that's what you take away from that? xchrom Mar 2013 #21
So... He's the new Jack Welch and all the MBA lemmings are following in his lead? Hugin Mar 2013 #20
And you still hear people edhopper Mar 2013 #23
But how many tee times has he sacrificed for that salary? At least, a couple. valerief Mar 2013 #24
The outsourcing was designed to lower our pay out of desperation for a job. Dustlawyer Mar 2013 #27
^^This!^^ BrotherIvan Mar 2013 #39
Is there a profit sharing payout? n/t Mopar151 Mar 2013 #28
If we had Medicare for All, the worker's health insurance costs wouldn't be in car prices. Scuba Mar 2013 #29
It's one of those things that makes all the sense in the world, which is why it'll never happen. HughBeaumont Mar 2013 #35
Both of these are excellent responses nt BrotherIvan Mar 2013 #43
I will say this for Mullaly...he saved Ford from bankruptcy. Ikonoklast Mar 2013 #31
Yup. Agschmid Mar 2013 #46
K&R. Seems like 2 million would be wonderful enough. Overseas Mar 2013 #34
you expect somebody to live on just THAT? hfojvt Mar 2013 #37
Yes indeed. He's not the only one. And stock helps things along. Overseas Mar 2013 #50
k&r n/t RainDog Mar 2013 #45
Ford is also charging 30+ grand for a new car just1voice Mar 2013 #47
Now if the executives salaries was cut by half then the company could return the workers Thinkingabout Mar 2013 #52
Nope. Do the math. Nye Bevan Mar 2013 #55
On the other hand, think about this; A HERETIC I AM Mar 2013 #63
There was a little story created with CEO Mulally in mind ... lpbk2713 Mar 2013 #64
The only real problem with that scenario is this: Without Mulally, there was a very real chance Ikonoklast Mar 2013 #68
Then he's probably worth about $500,000/year salary Duer 157099 Mar 2013 #70
k & r thanks for posting..... nt Stuart G Mar 2013 #71
Ford again in the news for negative shit. Rex Mar 2013 #73
It is the xxqqqzme Mar 2013 #76
Hate to say it, but for $21 million Ford under him ignores design for style... sfpcjock Mar 2013 #84

HughBeaumont

(24,461 posts)
4. "Austerity for thee, not for me . . ."
Tue Mar 26, 2013, 07:28 AM
Mar 2013

But hey, in the name of "competitiveness" it's a sacrifice he's willing to make!

Puzzler

(2,505 posts)
5. To "be competitive" ...
Tue Mar 26, 2013, 07:51 AM
Mar 2013

... workers have to have their pay cut.

But, CEOS, in order to "be competitive" have to have their pay raised.


madokie

(51,076 posts)
7. It makes for a better story is my guess
Tue Mar 26, 2013, 07:55 AM
Mar 2013

and many probably won't notice the discrepancy all they'll remember is the cut in half part.

erpowers

(9,350 posts)
9. Raises
Tue Mar 26, 2013, 08:08 AM
Mar 2013

When I read that part I assumed the workers had been given raises over the five year period. The statement mainly said, during the financial crisis, worker pay was cut in half and now sits at $19 an hour. I guess that statement could have been left out, but I think the author's point was that during the financial crisis the pay of entry-level workers at Ford was cut in half.

Art_from_Ark

(27,247 posts)
10. Because the 50% cut was 5 years ago
Tue Mar 26, 2013, 08:09 AM
Mar 2013

"That rate fell by half when the auto industry financial crunch first hit five years ago and now sits a bit above $19.

bobclark86

(1,415 posts)
32. You left a sentence out... we need to know what "that" is
Tue Mar 26, 2013, 10:05 AM
Mar 2013

"Entry-level workers at Ford used to make $28 an hour. That rate fell by half when the auto industry financial crunch first hit five years ago and now sits a bit above $19."

So... it was $28, it went down to $14 or so, then went back up to $19 is the way the paragraph reads.

If that's the case, then didn't the entry level guys get $5 raises in the last 5 years, or did the rate really just go to $19 and the Alternet writer couldn't do the math to figure out it's less than a third (32 percent and change)?

Third? Half? What's the difference. Who cares about accuracy when we can try an manipulate feelings? Feelings are more important than reality anyway...

csziggy

(34,135 posts)
78. It was cut in half and has now gotten to $19
Thu Mar 28, 2013, 02:56 PM
Mar 2013

From the OP:
"That rate fell by half when the auto industry financial crunch first hit five years ago and now sits a bit above $19."

Nye Bevan

(25,406 posts)
13. Is $19 per hour for an entry-level worker really that bad?
Tue Mar 26, 2013, 08:19 AM
Mar 2013

Around $40,000 per year based on a 40 hour week? Seems reasonable for an entry-level employee.

99Forever

(14,524 posts)
16. Is $21 million "reasonable" for ...
Tue Mar 26, 2013, 08:37 AM
Mar 2013

... someone throwing workers into poverty and destroying their future, and slashing the pay and benefits of those lucky enough to keep their jobs?

Seriously, just what fuck is wrong with you?

Nye Bevan

(25,406 posts)
22. If every company in the US paid entry-level workers $19 per hour,
Tue Mar 26, 2013, 08:53 AM
Mar 2013

I would accept a bunch of CEOs being paid $21 million.

You wouldn't take that deal?

99Forever

(14,524 posts)
25. No one...
Tue Mar 26, 2013, 09:03 AM
Mar 2013

.. I repeat NO ONE, is so valuable that they should be compensated that well. That is the basic problem that is killing this nation, people such as yourself accept that millions should fight for crumbs, as a tiny few feast.
Greed is the problem, NOT the answer.

winter is coming

(11,785 posts)
30. +1. IMO, not only do we need a much higher minimum wage,
Tue Mar 26, 2013, 10:00 AM
Mar 2013

we need a law that limits the total compensation for all of a company's employees to something like 25-50 times the compensation of the lowest paid employee.

hfojvt

(37,573 posts)
36. but MANY are actually feasting
Tue Mar 26, 2013, 10:26 AM
Mar 2013

consider this

average income of the top .1% - $7,437,986
average income of the top .9% = $755,246
average income of the top 4% = $227,956
average income of the next 5% = $165,389
average income of the next 40% = $61,890

There's 9% of the country making over $165,389 a year (besides the top 1%). That's 9 million families, NOT a "tiny few".

Then there's the bottom 50%

average income of the next 25% = $21,835
average income of the bottom 25% = $8,735

So there's ONE person making $19 an hour. At $38,000 a year they are already well above the average for the bottom 50%. If they have a spouse with even a minimum wage job, their household income would be $52,000.

Greed IS NOT the answer, but what about the greed expressed here for a person doing better than 50% of the rest of the country but some here think THAT person should get MORE. As if paying that person $25 or $40 an hour is somehow gonna help the 25% of the country that makes $8,735 a year.

Sure, maybe their $40 an hour will trickle down to those making minimum wage.

99Forever

(14,524 posts)
38. Way to buy into the fascist bullshit.
Tue Mar 26, 2013, 10:54 AM
Mar 2013

There isn't a fucking thing, you or any of your corporate masters can say, that will EVER convince me that "the problem" is some wage earner making $19 hr. That's barely a living wage. So, hovel and beg at the feet of your oppressors, if that's what you want. I have nothing left to convince that you and others with your mindset that you are your own worst enemy or at the minimum, the enabler of your own worst enemies. Enjoy life on your knees, if that's what you prefer.

hfojvt

(37,573 posts)
48. whatever that means
Tue Mar 26, 2013, 07:32 PM
Mar 2013

there is nothing you can say to convince me to cry tears for a poor, poor baby making $19 an hour.

I've spent all of my life making much less.

If $19 an hour is barely a living wage, then I must be dead. Because I only make $15.50 an hour.

And somehow I managed to give $3,500 to charities, $600 to my nieces and nephews, and put $6,000 into my retirement account.

The problem is not so much the worker making $19 an hour, it is the GREED of all those people wanting "more, more, more" for MYself. $19 is not enough. $25 an hour is not enough. "I make $130,000 a year, but I am not rich"

The bottom 50% got 12.5% of the pie in 2006. Well, it was not the top 1% who got the other 87.5%. The top 1% gets a ridiculous slice at 22.1%, but the top 24% gets an even bigger slice at 46.1%.

If they are greedy, they will just try to increase the size of their own slice, instead of perhaps giving something up to help those in the bottom 50%. That seems to me like the biggest piece of "I've got mine" bullsh*t there is.

hfojvt

(37,573 posts)
56. yeah I know that one
Tue Mar 26, 2013, 10:48 PM
Mar 2013

it's where some crabs step on other crabs, breaking their legs in the process and thus escape the bucket and then claim "we are all in this together, solidarity man".

hfojvt

(37,573 posts)
61. oh I know
Tue Mar 26, 2013, 11:37 PM
Mar 2013

it's when the 7 million crabs who don't have a job somehow don't cheer for the employed people with $25 jobs, when they would sorta see twice as many jobs paying $12 an hour. Those silly unemployed crabs just cannot figure out how the lucky guy making $25 an hour is really a benefit to them. If it wasn't for their bitter selfishness they would surely have a $25 an hour job of their own, surely everybody would, but, but, but noooo, they just pull everybody down, the damned selfish, jealous losers.

haele

(12,646 posts)
44. Actually, wages from $25 to $40 an hour do trickle down to the economy at a high rate.
Tue Mar 26, 2013, 03:55 PM
Mar 2013

People working at that level tend to spend most of their money in their local economy - at grocery stores, family restaurants, mechanics, dentists, pharmacies, veteranarians... They also still tip at a decent rate to their wait-staff. They tend to pay almost all tax levies they are required to pay (especially in sales taxes) and they usually don't have enough deductible expenses to take advantage of the larger corporate loopholes at the state or federal level that might actually give them subsidies.
This level of wage is the money that creates jobs, supports community services through the taxes and local spending, and ultimately is the greatest driver in raising both community standards and wages at the lower levels of income.

It isn't until around $55/60 an hour that some of that money really starts to go into investments outside the local economy - that's at the $110 - $130K gross salary level. But even then, you'll probably be seeing more of the luxury services in the economy - private accounting or legal services, contractors, high-end restaurants and entertainment venues getting part of those wages.

At around $250K salary, probably a third to a half the income that person is making is sheltered somehow from taxes - if they're smart with their finances and not living large or using a small business as a personal ATM. The loopholes they can use are also a lot larger, and I do know of some people even at that level who are able to leverage those loopholes and sheltering vehicles to actually receive more money back than they paid in taxes over the year.

The only people who aren't able to see a significant savings at the $250K - $500K income level are those who don't invest, or disabled/chronically ill people who are carrying their own health and living support costs (health care deductions suck!), or are supporting several adult dependents who aren't working and can't be deducted. Another failure to save at that level is found in those who are running a "family business", i.e., leveraging family/home resources or paying employees under the table to "save on costs short term" - and they aren't able to realize all their deductible business costs - primarily because they aren't separating their personal income from business revenue, for whatever reason.
Usually this is because they don't want to admit how little they are honestly making from their business if they ran it as a business instead of admitting that at that level, it is really a hobby business - or they're running their business as the family ATM, buying toys like RVs, boats, and vacation homes on "excess profit" during good quarters that they should be plowing back into the business - or into savings or capital income vehicles to take care of retirement for everyone involved after they get too old to run their business.

Detroit, Chicago, Cleveland - these were thriving cities with a sustainable lower working/service class when there was a majority middle working and professional class living, working, and spending in the city. When the wage gap was more equally divided, and a high-school diploma or associates degree/trade school certificate could get someone on their way to a comfortable life and a chance to retire in dignity.
When the working middle class fell into just the "working class", and the gap between the wealthier and the poorer levels of income became greater, and those with the money left to get away from those "nasty, dirty, ignorant poor people", these cities just started to crumble.

People who try and pit the middle working class against the poor by complaining about wage differences are ultimately apologists for the business or financial "tycoons" who want to keep living like kings, hording their money in offshore accounts instead of paying their fair share to maintain the thriving infrastructure that contributed to - and keeps contributing to, despite their misguided efforts - their great wealth.

The poor don't deserve to be poor and certainly need help to get to a place they don't need assistance and have access to an income that allows them a decent standard of health and living.
But those who still have jobs that pay close to the compensation they deserve due to the work they are providing and are paying their fair share of taxes to maintain the community infrastructure are not the ones causing the suffering and low wages and are certainly not the ones who should be "punished" or scorned because they're not the greedy fools and/or bigots who have taken away the living wage jobs and ability to maintain the local community.

Haele

hfojvt

(37,573 posts)
58. not really very populist
Tue Mar 26, 2013, 11:01 PM
Mar 2013

just a whole lot of rhetoric for the elite to try to justify their much higher income than the proles. "See, our huge incomes actually benefit them". The rich always have elaborate arguments for their trickle down theory.

haele

(12,646 posts)
69. So a wage of $50K a year puts you in the elite?
Wed Mar 27, 2013, 05:40 PM
Mar 2013

I know you don't get paid what you're worth, and that's the fault of your employer and the culture of your community, not the fault of someone else who works just as hard as you do.

It's not your fault, and it's not my fault being a techie type that's making halfway to six figures.

But having lived in several communities that have gone through revitalization, I know first hand it's amazing how quickly and how much lower wages, additional living wage jobs and the community standards go up just with even just a 5% increase to a depressed community population of families recieving wages in the $45K - $100K range when a new tech business or hospital with union wages moves in and those employees settle in that area.

The problem is that we need more jobs with a living wage and a chance to advance. And frankly, "rich people" don't create those sorts of jobs, consumers who spend in the area create them. Money churning in the local economy create jobs.

I've been extremely (One daily meal of PB&J living out of the car) poor in my life, and know how much luck and "being in the right place at the right time" plays into having a job that pays the bills and puts a little in the savings account. Hard work, education - that means nothing without opportunity, and just one mis-step or accident can cause you to lose it all.

Being bitter of those just up the wage ladder from where one is and calling them sell-outs doesn't help anyone's position in life, it just makes it seem as that that person wants to drag everyone who isn't "rich" down to their level - or worse, ensure anyone that doesn't meet their standards of "virtuous poverty" can be put benieth them and sneered at for being selfish and greedy instead of a proper prolitariat.

Trotskey never said people couldn't make money for themselves and their comfort. It was more that they shouldn't profit unfairly of the labor of other.

Haele

hfojvt

(37,573 posts)
72. $50,000 a year puts you above about 50% of the rest of the country
Wed Mar 27, 2013, 06:23 PM
Mar 2013

Who said anything about bitterness? What did I say that was bitter?

I said that $19 an hour, especially for a starting wage, still sounds pretty good to me.

The greed seems to me that everybody here is seeming wailing about "oh noes, $19 is not enough, they should make a hundred and twenty dollars an hour, nobody can live on a mere $16 an hour."

And the other point is that it is not just the 1% or the 0.1% who are squeezing the bottom 50% and eating all the pie. Those in the top 9% and the top 19% have fairly large slices themselves.

It is just absurd to claim that when my income doubled that somehow gave a benefit to my neighbors. For the $19 an hour person to goto $28 an hour doesn't do much at all for those who are making $8 an hour. It's trickle down nonsense and it has policy implications too, as the Democratic party is very eager to serve the $30 an hour set (who gives them most of their donations) and to throw the $10 an under set under the bus.

haele

(12,646 posts)
74. Deep breath - The benefit is in the taxes and spending that the $50K - $100K does.
Wed Mar 27, 2013, 10:32 PM
Mar 2013

Income at that level works in the community because it is spent. The person making that income is not "rich enough" to do much more than spend it. Honestly, what would you do if your income at $8.00 an hour was doubled? What would you do if it were tripled? Don't think of it as a one-time windfall, where you pay off all your bills and then it goes away, but what would you think you would do if you would be collecting that income for another year or two - perhaps up to ten years?

Do you honestly think that what you would do with a regular living wage income that allows you even small expenditures beyond paying the bills doesn't help your community?

My income does benefit my neighbors. Anyone who lives in a neighborhood where the local economy is depressed or is recovering can see that my ability and that of my neighbors to pay local taxes and fees - be they sales, property, registration, local income and bonds - affects the infrastructure of my community.
My income benefits my local businesses. My income especially benefits my local businesses if I'm able to buy a house, or a car. If I bought a house, my property taxes and bond fees helps pay for schools, garbage collection, infrastructure upgrades. My sales taxes goes into the general fund to help pay for city services. When my neighbors are able to pay their bills, taxes, and still have a little left over to spend, they not only also help with the taxes, their relative "comfort" - that feeling of economic safety - makes for (usually) less crime and more volunteerism in the neighborhood.
When I have more money to spend, I spend it. That money goes to businesses who, seeing more customers like me, find themselves needing to hire more people to handle the increase in customers.

True, as an individual, my $4 - 10K more a year in spending ability doesn't seem like much, but ten of me can be the difference between one person being hired at a small business or losing their job.

Similarly, if my income goes down, or I lose my job, I become a burden on my community. Not in unemployment, but in resources, because if I can't afford to survive on my income or savings, the community has to carry me.

Now - about the so-called whining about entry level jobs.

I'm old.

I remember the difference between teen-aged entry level jobs and entry level jobs for skilled trades - like an automotive worker, or a welder/pipefitter, or an electrician.
Good, union jobs - or even just a more professional retail job, a gas-station mechanic, or full-time janitorial job.
Jobs where it was assumed that if you were applying for these jobs, you weren't living with your parents, working for "pin money", or going to school at nights or hanging out trying to figure out what to do before you married someone with a job, but you were setting out on a career, hoping to take care of your future, and that you intended to work at that job for a length of time where it would behoove your employer to invest in you as a worker.

in 1978, my little brother was making $2.65 an hour as a part-time bagger at the age of 16- the lowest wage on the scale - at Albertsons; your typical minimum wage/training wage for an untrained entry level worker. That is the same as making $9.44 today.
The year before, while I was waiting to join the Navy, I applied for and worked for three months as a part-time (no benefits) file clerk - lowest position in the office and basically a "no training" student job - for $3.75 an hour for UW - which would be $14.37 an hour today.
In both these jobs, it was understood that we were living at home, that we were being supported, so we weren't going to actually be "living" on these wages.

In 1997, the union at NASSCO had entry wages for welders and electricians - requiring certification and training, but no experience, at $15.50 an hour with full benefits.
That would be $22.32 an hour today. But oddly enough, even though that union is still in place, and welders and electricians require even more certification and training before they apply, their entry wage with a six month wait for partial wages is $13.75. That's less than my comparative wage in 1977 for three months as a part-time, unskilled, "student" file clerk at the age of 17.

Makes you wonder why it's "okay" for grown, skilled adults trying to keep a house together to have to make due with making $8.00 an hour. Especially if they're skilled.
What makes that acceptable when people who labor to make money for those who invest have to make do with less and less while those who invest make even more? Why do so many who have been hurt already in the lower 50% seem to think that they deserve to live with making due with less because - what - work doesn't deserve compensation?
Should the assumption be, if you're starting out, you haven't paid enough dues to get a living wage that pays off your student loans, or allows you to start putting money aside for emergencies or retirement, or to save to buy a house or a car?

This race to the bottom in wages hurts everyone who works for a living. And it hurts the chances of of a decent wage for those who are living in a depressed area and working as hard as they can, because without maintaining good "entry level" wages - especially for those re-entering the workforce, you as an employee no longer have the ability to say "hey, the prevailing median wage in this field at this zip code is $50K a year - or $25.00 an hour. You're hiring me at this position that you need to support and grow your business, so I think I should be making at least $15.00 an hour instead of the minimum wage you are offering, and I'll work my ass off for you at that wage."

The thing to remember is that no employer hires unless the workload is such that they need someone to do the work. The problem is that the culture of employer/employee relations has degraded so much that work itself has no value, only profit has value. Labor is being increasingly divorced from revenue, and that's why it's now apparently okay to pay someone minimum wage to work their ass off making the employer twice to three times more than the employer is paying in costs. Labor is supposedly to shut up and be grateful for having a job that pays a pittance. Just like the more money you make, the less you are supposed to have to pay for the infrastructure you are making your profit off of.

Yes, my $50K a year can help someone who is poorer than me improve their situation. If their wage relationship with their employer allows it.


Solidarity!

Haele

hfojvt

(37,573 posts)
75. you just keep repeating the argument for trickle down
Thu Mar 28, 2013, 02:34 AM
Mar 2013

and then switch gears.

When you start talking about the lower wages, then it seems to me that you are making MY argument that $19 an hour is pretty good.

In 1978, I was also 16 years old. Unable to get a job at the local grocery store or the local K-mart in spite of the fact that I had four years of work experience as a paperboy.

By 1997 I was 35, I was making $5.50 an hour as a part-time janitor until I got hired for $7.15 an hour at the non-union auto parts plant. At about the same time, the Duke of Wisconsin, Tommy Thompson was bragging about a plant opening in Eau Claire, paying a whopping $6 an hour, for which he was attacked and he replied "What is wrong with $6 an hour?" In 1994, I was working at the satellite dish factory and some of the welders were making decent money by piece rate. Myself I was mostly making $5.40 because the lady on 1st shift blew the curve by being such a dynamo. But the some of the welders were driving thirty miles each way for their jobs and nobody at that plant was making $15.

Again, my point. You want to talk about higher wages in the past, that is all well and good, but not everybody was getting those higher wages in the past. Those $15 an hour jobs in 1997 were not doing me a tanjed bit of good where I was.

I don't believe in a solidarity which means big money for YOU and trickle down for ME, no matter how many tales you want to tell about how money in your pocket puts bread on my table. Like the $25 an hour that that skilled plumber charges me actually helps us all.

haele

(12,646 posts)
77. No I'm making this point because this is part of the research I am doing for my degree.
Thu Mar 28, 2013, 02:43 PM
Mar 2013

Last edited Thu Mar 28, 2013, 03:31 PM - Edit history (1)

For the past year, for my capstone paper for a degree in Business Economics I have been studying to find a the "sweet spot" between wages, labor categories, and employment trends to balance with community costs of living and economic opportunities while accelerating and stabilizing a recovering local economy.

(Yeah, yeah - should have gone Systems Engineering, but I'm at the level I'm going to be trying to be manager or manage my own business, it's cheaper and quicker to both work and get a business degree with minors in economic growth and emerging technologies.)

The area I have been surveying is a zip code that consists of approximately ten different neighborhoods. Those neighborhoods consist of a 2011/2012 baseline survey of median households per the 2010 Census in which there are four neighborhoods income is pretty much pegged at $24K a year, three neighborhoods where the median household income is $53K (plus or minus $4K) a year, one where the median income is $97K a year, one where the median income is $123K a year, and one well-established "old school" neighborhood where the median income is $372K a year.
In the previous census (2000), this was a poor zip code with more than half the neighborhoods at an average household income of $11K (neighborhood dependent upper tail standard deviation of the mean of between $5K) a year, two around $60K, and that one ritzy neighborhood with $233K a year.
Need I mention that most of the neighborhoods in this zip code are minority, on welfare/TANF, SSDI, SSI or were workers in the shipyards, warehousing, or in small local manufacturing and retail?

The reason I picked this neighborhood (other than I live here) was that half of these neighborhoods have just gone through or are currently experiencing "gentrification" - where stable working families of the middling wages (the $50K to $100K level) have bought distressed/vacant properties and have rehabilitated them to live in. Or flippers had done the same and sold to those same families.

I have been finding a trend, almost to the point of correlation, that an increasing the gap in wages across all labor categories leads actually to less business development, while a more equitable wage balance, with the lower wages up and less profit on at the upper limits of income/revenue, are present in the more successful businesses and promote community development.

Customer Base -

Interviews with several small community retail owners have proven that for non-bodega (or convenience store) businesses, the loss of 2% of customers, or one regular (> $50 spending every two weeks) monthly customer is noticeable and when there is a loss of 10% or five regular customers that cannot be recovered over a six month period, there is a significant enough loss in revenue that at least one employee will need to be cut, or if there are no employees, they risk losing the business.

Wages -

The small retail businesses I survey also pay their employees after a trial employment period of 3 months at minimum wage (CA - $9.00) to around 15% above minimum wage - generally around $10 to $10.50 an hour for the first year for part-time and up to $15 for full time after the first year. (Even IGAs will practice this wage structure) When compared to the Targets/Kroger, Incs/Walmarts or other big box stores, for strictly retail or support employees, small businesses usually end up paying more and have less employee turnover at those employment levels.
A few businesses add commission to those wages. The owners of those businesses - the ones that are serious and not hobby businesses - tend to realize an income of between $60K and $140K a year; usually that income is the profit margin of 5% - 7% after costs (for purposes of this survey, costs include employee wages).
For small service and manufacturing/installation businesses that are successful (lasting over 10 years with a minimum revenue/profit margin level of 15% after all costs, to cover future business expenses) have a median entry pay at $12.50 for support (driver/clerk/janitorial) work and either $15.00 + 20% commission or straight $17.35 for work that is either skilled labor or requires interaction with customers. This is at the first year entry level, and 95% of these businesses regularly (usually annually) provide for an increase of wages to their employees.

Observations -

Where these businesses are struggling, cutting wages doesn't really help them stay afloat. Cutting workforce can help, but cutting wages or hours doesn't. There doesn't seem to be a difference between lowering the wages of five people by half or leaveing them where they were and how it affects the success of the struggling business - other than how much more income the owner can claim, that really isn't really much once taxes kick in.
The real difference in business revenue comes in balancing the labor force with the level of customers or orders, which is why I point out that having more $25.00 an hour workers in relation to $8.00 an hour workers helps community business and adds to jobs within that community. And in neighborhoods where the small businesses regularly pay their employees more than minimum wage, they consistently see better revenues than in neighborhoods where businesses regularly pay minimum wage.

Community Infrastructure Support and Cost of Living -

City councils and infrastructure organizations pay attention to these standard of living trends, and the services provided to these neighborhoods are both more regular, plentiful, and cheaper - the costs to purchase food and necessary sundries (shampoo, OTC meds, diapers, underwear...) to the average households are consistently lower by at least 12% in the mid-economic range neighborhoods than they are at the poorer and the wealthier neighborhoods. Gasoline prices are also lower in the mid-economic range neighborhoods.

To reiterate - I have consistently been finding proof that maintaining the same "high wages" of similar to that found in the unionized communities of the past lead to a better standard of living and opportunities for employment at the lower level of the economic ladder. When people are paid an equitable compensation for the amount of work, both physical and mental/social, the community is better off.

So yeah, looking at the job positions you list in your post, I will agree (and my research is proving) that you and your community are being screwed royally - because apparently, the jobs in your location were either not protected by a strong community interest base (not just a union, but employer/employee relations recognizing benefits of better wages), or that the business leadership culture is more interested in big-dick comparisons at the local country club than the quality of work in their actual businesses, their customer base (especially if they are providing a local service) and balancing their wages with the cost of living in their communities.

And to "change the topic" - I'm not saying this to put you down or try to justify wages, but I really am curious as to why you think the ability to pay bills and not be falling behind every other month is "big money".

Do you think that making only enough money to pay the rent, keep the utilities on and food on the table, pay for medical bills and maintenance on a used car is big money?
The issue I've been discussing with you is the concept of equitable pay for equitable work across the board - $50K on the West Coast, or in areas where the cost of living is high is not the same as $50K in, say, where my sister-in-law lives in Demopolis, Alabama - and even then is not "Big Money". $50K a year there gives one the same style of living as $85K does here in San Diego.

Big Money to me - even when I was out of full time work for two years, saving what little I was making and living out of a p.o. box and a van conversion, taking showers at the base gym because I was still a reservist - is a comfortable, professional desk-sitting type of job, typically "white collar work" where the "employee" is not really an employee but an owner, co-owner, or associate of a business that takes a percentage of revenue rather than a wage that will be part of the cost of doing business.

The other definition of "big money" is when you can afford to max out deposits into all available retirement accounts and a few annuities, pay the mortgage on a vacation home, send your kids to a $30K+ a year private school without taking loans, and still be able to take both take an out of state summer vacation and skiing vacation every year. Yeah, I work two levels down from someone who does that. They can do that with at least one spouse making $217K a year. I don't know what the other spouse makes, but Mr. VP was sure pushing us to "max out our 401Ks" and get into company stock, because he was concerned about our retirement - and the company stock.

That level of money is something far different than making enough to put aside 2% in a 401K, pay the year lease on a rental home, maintain a used car, shop at Sears rather than WalMart for new clothes and thrift stores for "fashion", and still have enough left over at the end of the month to take the kids to a dinner out or the local museum or zoo.

And I know that even that is far different than:
-going to work after showering at the base gym,
-hoping your clothes can seem decent enough for another day before you need to find the quarters to do laundry,
-make due with a granola bar for breakfast, a scammed salad for lunch ("hey,good work-buddy - are you going to finish that?&quot and a PB&J for dinner
because you're only making $8.50 an hour working part time/full days at a "skilled trade" (and can't take time off during the day to find a better paying job, so you hope your friends and your resume will get you the job you are really qualified for).
And that small 4x4x6' storage room with all "your stuff" - what little you couldn't bear to yard sale when you lost the first job and a little bit of furniture "just in case" - costs $100 a month, insurance and gas for the vehicle you live in and go to work with has shot through the roof, and the state and local taxes your employer takes out of your paycheck are seriously regressive to single people who aren't making very much and they aren't able to claim they're paying rent or a mortgage.

And you do this day after day for months because the cost of living on your own in a crappy studio apartment (which allows you to ditch the storage room and allows you to sell the van and get a more cost-effective vehicle to get to work with) and pay utilities requires that you make at least $13.00 an hour, and because you need to have a downpayment to move into that crappy apartment, you need to find at least $50 a month to put asideso that maybe in a year - and if you get that better job you're angling for - you have the down-payment to move into that crappy apartment.

That was San Diego in the early 1990's. It's far worse now.
When you're young and single, that's a "grit your teeth and get through it" situation. When you're older or have a dependent to take care of...it's a hell that's easy to just not be able to get out of.

Again, I'm sorry jobs are so fucked in your location that the majority of the community around you are are making minimum wage.
But despite what you may personally believe, "trickle down" does not mean that the the working folk making a little more than the very poor are the ones who are grabbing opportunity from those who are on the bottom. "Trickle Down" is not the guy spending more than 90% of his or her monthly paycheck to pay taxes, maintain his or her business, and spend in the community. The government - state, federal and local - gets a whopping 47% of my gross pay, which pays for federal, state, and local services - including jobs that pay living wages and support for those who aren't making enough to survive. (BTW, that's not counting FICA and Social Security tax, which I count as paying to myself).

The property manager gets almost 50% of our monthly net income. That's the owner of the business, seven employees, and four contract maintenence people taking 40% of the rent, and the owner of the house getting 60%. They're not that big a management company, so it is important to keep rent revenue going.
The IGA market which has a gas station down the street gets 10% of our family net income.
The Commessary gets another 5% of our monthly net (2 adults, 3 kids) Okay, that doesn't employ as much in the local community as the IGA does, but it allows us to spread more money around.
Two food trucks get 1% of our family montly net because we like their food and want to keep them in business. Another 1.2% probably goes to the local drive throughs.
Various vendors at the farmer's market get a total of 5% of our monthly net.
The local Tru-Value hardware store (which is also a feed store) usually gets an average of 3% of our annual net. (old house, elderly owner with little money, baby in the house, poor property management - and they have good prices on cat and bird food)
Our local veternarian gets 2% - 3% of our annual net income. (four cats, one bird, one turtle)
And on, and on, and on
So that's "trickle down" to the poorer below me? (Don't mean to make it personal, but this does seem to be

Trickle Down is when tax and regulatory policy gives advantages to the wealthy owners of capital who will allow whatever is left after they take everything and lock it away out of the local economy to "trickle down" to the workforce.

When I was down, I've gotten far more help - in job references, in opportunities, in price breaks that inconvenienced them, in just plain help - from those who's income is in the middle, those who remember what it's like to be dirt poor - than I ever had from the "beneficial rich" or charities set up by those who liked to pretend they were helping.
Now that I'm better off, I do the same for those who need help, because it's the right thing to do.

And I'm hoping that my research will lead other businesses to recognize that doing the right thing by their employees, by returning to more equitable wages and closing that gap, will help their business and their own standard of living, their community far more than just raking profit off the backs of the workforce and walling themselves off in their own little fantasy world.
Because they have to deal with the real world sometime. And history shows that maintaining a large living standard gap between rich and poor never ends well for the rich.

I'm not a angry person, but I do hope that all those bastards who are poisoning the working classes against each other by threating the remaining cookies rather than encouraging sharing so they can grab more are going to rot in the same hell they are creating for those who work for a living.
And I'm tired of people mis-applying the term "trickle down" to other workers. It suggests that there's only two classes - the vituous poor and everyone else are greedy assholes who are stealing from them.

Haele
- Second edit was because I realize I'm blocking out the abstract for my paper. Never too early...(No More edits)

hfojvt

(37,573 posts)
79. it's certainly not trickle DOWN
Thu Mar 28, 2013, 05:34 PM
Mar 2013

when I pay a vet bill. The vet probably makes a lot more money than me.

But apparently their $80,000 a year income actually benefits me, so I should not begrudge the high prices they charge or dare to call them well off or anything because somehow that would just be playing into the hands of the lords of the universe.

As to why I think $38,000 a year is bigger money that $16,000 a year, I dunno, Maybe it is old school math that I was taught somewhere.

Even in Californication, 40% of households are making less than $36,000 a year. In Michimiligan, 40% of households are making less than $32,000 a year. Often households have two incomes, so I am supposed to be all sad, about ONE person making $19 an hour to START a job?

But the poor are not really virtuous either necessarily. It's not about the income, it is about the greed. You know, the people with the household income of $60,000 who think "it is not enough" or "it is barely enough" as if 40% of their "neighbors" (in the same town maybe, but on the other side of the tracks) are making less than HALF of that much.

True, most of those $60,000 crowd whiz away much of their income so they can live in a "better" neighborhood (far, far away from the canaille)

Let me say it again though. It is not the top 1% who is taking all of the pie. They currently only get about 20% of it. Or to give more detail. Total AGI in 2008 was $8.427 trillion. The top 0.1% got $839 billion, the top 0.9% got $846 billion, the top 4% got $1,242 billion, the next 5% got $930 billion, the next 40% got $3,496 billion, leaving a whole $1,074 for the bottom 50% with about 2/3 of that going to the top half of that group. That's $2,172 for the top 9% (by which I mean the top 10% without the top 1%) and $1,074 for the bottom 50%.

I would claim that the greed of the top 9% is as big a problem as the greed of the top 1%. That, in fact the Government, including the Democratic Party is considering and proposing measures that would negatively impact the bottom 50%. Things like the chained CPI and a higher retirement age. And yet, and yet, any sort of tax increase for those in the top 9%? Well, that is off the table. It cannot even be considered and in fact nobody is daring to propose such a thing. It is just not heard of.

So with the latest ATRA piece of Reaganomics crap that came, not from the Republicans, but from Obama and what was once the Democratic Party. $3.7 trillion in tax cuts over the next decade. With $666 billion of them going to the top 1%, but also $666 billion of them going to the top 4%, and another $1.07 trillion going to the rest of the top 20%.

And while those in the top 20% are counting their tax cut money, programs for the poor, like foodstamps and for the unfortunate, like unemployment insurance, because we have to cut spending.

Why do we have to cut spending? Because we cannot ask families making $140,000 to pay even a little bit more in taxes, because those people are part of the struggling middle class - just like me.

Yeah, sure, we are all in this together.

Oh, and let's also get rid of the "making work pay" tax credit and replace it with the accursed payroll tax cut. That way people above the median income get much bigger tax cuts (and people below the median income get much smaller ones) See page 3 http://www.ctj.org/pdf/taxcompromise2010.pdf $7.3 billion for the bottom 20% then becomes $4.26 billion and $11.6 billion for the middle quintile becomes $16.8 billion.

Their gain, our loss.

Solidarity forever. (and the $26.9 billion going to the top 9% is just icing on the let them eat cake.)

haele

(12,646 posts)
80. OK - 95% of my family income going to taxes and local businesses means I'm just like the top 1%
Thu Mar 28, 2013, 08:31 PM
Mar 2013

Last edited Thu Mar 28, 2013, 09:24 PM - Edit history (1)

So let me get this straight - your argument appears to be... whenever discussing poverty and wage issues, if someone is in the middle income, they should just shut up and say they're part of the problem, should be ashamed for being greedy f*wads just like Paul Ryan or Lee Reynolds or any number of CEO types.
That like entry-level auto technicians, the veterinarian you are complaining somehow doesn't deserve her $80K a year because - well, she's not really a doctor - even though she practices medicine (not critical to people, true) may still be paying off student medical loans, and like every other businessman/woman who has to handle her business costs (true, she can deduct them).

I'm sorry, I'm snarking.
But IF I can understand where your argument with me and my point is, it is that somehow, the people that end up paying the highest percentage in federal, state, and local taxes up - especially those single individuals who are making employment W-2 type income (not capital gains, or annuitized payments, or any of those other financial vehicles) between $45K and $90K are participating in the trickle-down of the top 1% that is currently strangling the poor. They are, after all, part of the 20%. And we're not discussing joint household taxpayers, right? Because a joint household making $90K might be one person making (and paying the taxes on) $60K and another paying $30K and paying the taxes on that.
Those taxpayers usually end up paying more because together, they're usually not paying enough taxes on their W-2 to meet the taxes for a household making $90K, unless they both pay the straight, no exemptions rate.
Single workers in this category pay anywhere from 40% to 65% of their gross income in taxes, depending on where they live, but at a minimum, they pay 40% of their income. They might get the famed "mortgage interest deduction" if they are lucky enough to be able to carry a mortgage, but that's not a big bucket of return, and the various governments are still seeing at least a third of their gross.
So, if you're single, healthy, and working for the city as an engineer with a house, that $90K a year is really only realized as $60K a year in your pocket. Plenty of money, sure - make your house payment, make a car payment, and go clubbing - or put money away in a retirement fund.
If you're making that much, are married, and there's no other income, you realize maybe $70K after taxes.
Woohoo! you're rich! Not rich enough to get hit with an ATM - which actually takes out less of a percentage of your taxes than where you are now, but too rich on the lower levels to be eligible for EIC.
From what you've written, you're bordering on that category, yourself...lower levels, true, but not that far above this "middle level"

As for me, since my spouse just got SSDI (woohoo!) we get a bit more income on top of my salary, but we ended up paying more taxes because even though we have bucu medical bills, the itemized deductions don't make up for having to pay taxes on 85% of his SSDI. So, last year ended up paying 45% of my gross income in Fed and State taxes (bumped us up a bracket), and another 8% or so on sales taxes.

Sorry, your posts is just so - aggressively dismissive.

If your discussion is about the Congressional Budget and policy making, now....

That's a whole 'nother kettle of fish and has nothing to do with what I was talking about, and honestly, from what I could tell had nothing to do with what this thread was originally about.

Put it simply - Congress does not listen to workers, Congress listens to lobbyists. Congress doesn't listen to the 20% - 10%, Congress listens to people who are in the top 5% and have money to buy access.
Chained CPI, Welfare to work - those are Wall Street constructs, and so far as I know, they aren't supported by people who work for a living. They are only supported by people who move money around for a living.

That "poor, poor, middle class individual" you are castigating making $140K a year honestly doesn't have anything to do with your complaint, because honestly - who are you talking about? A lawyer (yeah, right - most lawyers I know make around $70K a year) A network engineer? A scientist? A plant manager? A corporate secretary? A surgeon? An airline pilot? The head of the local school board? A small businessman?

Do any of these make tax policy?

Do any of these middle class consumers have shit to do with "welfare to work", setting the AMT, closing tax loopholes, lowering or raising capital gains taxes, cutting spending on programs that benefit the working class, the disabled, the elderly and children - do they have anything more to do with those policies than someone who is on disability falling behind on their utilities with the bill-paying shell game and spending the last week of one month looking at an empty pantry, waiting on the next SSDI check to buy food for the next?

Or is the problem that they are unfairly benefiting from policies that had been made by people far above them, even though they may vote against politicians and initiatives that promote these policies, or work as activists against these policies? Even though they may know these policies are wrong?

Yes, sure, everyone - and I mean everyone says "don't raise my taxes", but looking at the bond issues that have passed in California that have raised taxes on us nasty, selfish 20%ers, the ballot box shows that people often look beyond their immediate preferences to make their communities better places.

I can agree with you 100% that Congress has gone off the deep end, and is dragging this country to a place most of us would never want it to go. I can agree with you that Third Way Democrats are nothing more than centrist Republicans, and that it sucks big time going to the voting booth to decide which is the lesser of two evils to "represent" you in government. Because you know you aren't being represented.

And I can certainly agree with you that there have always been hard times, and some people just don't have the luck to get opportunities to have a better life, that the past wasn't some sort of "Pleasantville" where everyone made enough to live like the Cleavers, because, frankly, pretty much everyone in my family was almost as poor as dirt until the mid 1970's, and I parlayed my time in the Navy to get far better jobs than I would have gotten if I had remained a civilian.

What such experiences have done to me is make me more determined to work to get equitable wage structure, access to health care, opportunities and community infrastructure improvements in all communities. For everyone. So yeah, I support getting more people into the top 20%. I support more people staying in the top 20% in a stable economy. I support more opportunity for everyone. And I know there's a shitload of work that needs to be done to accomplish these things, because of all the greed and politics at the levels above me.
So, what's so wrong with that?

Complaining about the entry level salary of a technical job? You do know, there aren't any factory auto technician jobs that don't require some sort of computer training before someone can even apply for that job - the technician jobs are such that you are either working on computerized electronic systems or working with fabricating robots that require computer programing.

Maybe an auto fabricator position is what you're thinking about when you wondered why an entry level position "deserved" $20.+ an hour in wages?

I took a quick glance - the average wage for an auto fabricator in Ohio is currently $38K a year - $18.27 an hour, so I figure an entry wage is around $22K to $25K( probably around $11.00). Metal Fabricators supposedly average $47K a year - around $23 an hour. In California, these wages are around $2.00 to $5.00 more due to the cost of living differential.
These are skilled labor positions, but not technical positions, so there's a difference of training requirements before one can get hired.

Go ahead and swing some more at me. Seems as if it's a bête noir that needs to be dealt with.

Haele

hfojvt

(37,573 posts)
81. swing some more?
Thu Mar 28, 2013, 09:37 PM
Mar 2013

There's a lot of verbiage flying around.

In my own post as well, including some words I clearly forgot to say.

I said, first, that GREED is part of the problem.

So it has nothing to do with income. It's not about the $80,000 a year or the $19 an hour.

MY perspective is 1) that $19 is very good money.

Many other DUers seem to be much richer, so from where they sit $19 is practically a poverty wage.

To me, it sounds like greed to say that a $19 an hour worker needs to, or should, make more money.

The vet is another fairly obvious case in point. Her income comes at least partly from the $54 she charged me for the last ten minute visit. It's pretty obvious that if she charges me more that hurts me and helps her, income wise. If her income drops from $80,000 to $60,000 because of lower prices then her customers are collectively $20,000 better off.

It is trickle down theory to claim that increasing the income of somebody who makes $60,000 a year to $80,000 is somehow gonna benefit those in the community who make $20,000 a year. That we, in the working class, should somehow be upset if a moderately rich person ends up making less money, because that somehow hurts us all. Because if they suddenly make more money that just won't allow them to buy more and better stuff. It will somehow trickle down to that guy making $20,000 a year.

As for making policy, yes, that $80,000 to $200,000 group is very influential, because collectively they make a lot of donations. They certainly provide more campaign money than the group of households who make less than $40,000 a year.

And it is no accident when policies benefit them a whole lot. Like the Backstreet Boys, they want it that way.

See, if it was up to me, taxes would go up a little bit on the group making $60,000 to $200,000, and then maybe that tax revenue could be used to provide more money for people who need TANF. Because I read somewhere that TANF benefits have not at all kept up with inflation and that many fewer poor people are getting TANF benefits, thanks in part to the NEW Democrats.

And complaining about the taxes that those rich people pay? Where have I heard that before? Seriously? California has one of the most progressive state income taxes around, but even in California the tax rates by quintiles are - 10.6%, 9.2%, 8.2%, 7.6%, 7.4% http://www.itep.org/pdf/ca.pdf As for Federal Taxes, even those in the top 25% are only paying an average rate of 9.29% http://journals.democraticunderground.com/hfojvt/169 So I don't see how people are paying 40%, much less 65% in taxes. 9.29 + 7.65 + 8.2 is only about 25%. Granted that is an average and some people may be far about the average, but Chebyshev says it is not very many.

haele

(12,646 posts)
82. Swing away - notice that though I tell you the percentage of taxes that come out of my paycheck -
Thu Mar 28, 2013, 11:08 PM
Mar 2013

I don't complain about them. And I certainly won't complain about the taxes my department head pays, or the VP of my company pays, or the CEO of my company pays. My taxes, and their taxes, and other people's taxes eventually come around to pay my salary, and if they don't, they pay for the services I use now, will use in the future, and have used in the past.
I'll pay them, and do so gladly, for the good they do as a common fund still outweighs the bad.

Though if Paul Ryan and the Randroids get their way, the taxes will end up going to the richy riches.

I'm also not saying "the 20% should pay less taxes" I have never said "the 20% should pay less taxes".
You keep missing with that, which is why I keep bringing the subject back to wages...

To put the tax-envy to rest - look, for the past three years, I pay on average an annual total of 40% between federal, state, and local income taxes and a good 7-8% of my income on sales taxes. For various reasons, primarily that not being a homeowner, unlike the majority of those in my tax bracket, I don't have the ability to itemize the deductions that might get me to the 9.29% "average" tax rate. I pay full rate to both state and federal - and BTW, taxes aren't an "addition" situation when it comes to what the total rate is, because what is counted as taxable and what isn't, and to what percentage something may be taxable is different between local, state and federal.
Now, we get $120 back every year from the state because we rent. So, I'm mistaken - I only pay around 38.7% of my gross income in taxes, and have to count that refund from last year on my federal taxes this year.
I don't cheat, I don't have "loopholes" and our family income is in the lower portion of a higher tax rate.
But according to some people, because I'm aware of how much I pay, why I pay it, and I don't live high on the hog, it must means I'm crying "Boo-hoo, poor me".
But what the hey, I'm just sharing my taxes because of my circumstances, and if they were higher, they'd be higher. Is that fair? Sure it is. I use a lot of infrastructure in my daily life.

If I get a raise and not much more in the way of deductions, I'd just have to cut out throwing some of my hard earned spending cash to the local food-truck owner. Of course, when I graduate, I'll be able to deduct my student loan payments, and then we'll see some deductions! I might even get close to 15% realized Federal tax rate!

As for "where I sit, asking for more than $19 an hour is greedy" - you don't know what someone is required to do - training, experience, testing - for that position and that wage. I'm sure someone will look up what is required to prove it is greedy, but my point still stands.

Sure, a 22 year old making $19 an hour could be partying all night with that - or that 22 year old could be paying off $40K or more in non-Stafford student loans, or the job that they are taking may required to continue expensive education to keep a certification that needs to be renewed every two or three years (medical certification, or IT - CSSIP Certification comes to mind), or they're not getting any benefits and have to fund their own medical and retirement through their job.

Is $19 an hour "greedy" if that is what is required for the person to live simply and pay off the debts required to get that job until they are no longer "entry level" and can start getting raises that will end up in a pay of six figures after ten/twelve years of hard work and promotions?
Or is it greedy because someone thinks they are making that $19 an hour just shuffling e-mails, answering calls and playing angry birds - and are spending the excess making it rain every Friday night with their buddies when they go out drinking?

No one can know how fair that income is unless they know where that job is (BTW, $19 an hour for a single parent gets you pretty much butkis in the 'hood in San Diego - too much for aid, not enough to pay rent - or mortgage - in a decent neighborhood and still pay for essentials), what that job does, and what value that job means to the business that hires a worker at that hour.
Just as people who bitch about those on disability have no idea what the disability is and how much that person is hurting. Or bitch about a single mother wanting to extend her welfare support because she's going to a university and has another year beyond what that support allows to get her degree.

An Auto Technician is probably coming to that job after having taken two to four years of training, for which they need to pay up to $40K of loans off depending on what they had to be certified on. And if they're installing/testing onboard computer systems or programming a robot for specialized operations, they may have to keep up on their training - and those courses aren't cheap.

As for the value of a wage to the business - that's usually pretty negligible to the business itself other than as a recruiting tool when it comes to hiring people with desired skills. What someone takes home is not really representative of what it costs the employer. I found in my surveys of small businesses that that hiring a better employee by offering 10% more than average, it has pretty much the same financial effect to that business as hiring a mediocre employee at 10% less than average.

Higher wages than the average may seem to come down to greed, but at the working levels, there is a lot of value that large businesses, especially corporations, are stealing from them. And subsequently stuffing that value into pockets of people with no more sense than an average floor manager at that business just because they know the right people or went to the right schools or know how to talk pretty enough to convince other people they're right.

So, off the tax issue altogether, since most workers have nothing to do with how their tax rate is set -

With today's cost of living, why shouldn't minimum wage be set at $19 an hour, pegged up only to the rate of the cost of living above the US mean? Keep the upper wages pretty much where they are - heck, I'll even forgo trying to get that merit promotion based off working for the degree "required" to make the job title I have now equivalent to the work I'm doing now- just peg up the lower 50%?
In most cases, that wouldn't affect the businesses very much at all - especially since most of them have already fixed the overhead issues that made the cost of the worker so high to them before the computer revolution.

Is that greedy, or would that help communities that are failing?

Haele

haele

(12,646 posts)
83. Side comment - If you want to know what your vet's life of luxery is, look up kestrel91316
Thu Mar 28, 2013, 11:34 PM
Mar 2013

Of course, Kestral doesn't make $80K a year after all the costs to maintain her practice are covered.
From her comments, I'd be surprised if she made $40K on a regular basis - which is just about living in poverty level in LA. Seems people don't think of her as a medical professional that has to maintain a practice, she's just a step above a pet groomer respect-wise.

Your vet went to medical school just like any human doctor. Vets usually charges about half what a normal doctor does, and since there's usually no insurance associated with their practice, people tend to forget that.

BTW, my vet charges $45 a visit. But she's in a large practice and shares clinic costs, and they aren't with the VHA franchise so they can set their own prices instead following the franchise rules. Her overhead is lower than most vets.

Haele

dickensknitter

(24 posts)
18. No it isn't...
Tue Mar 26, 2013, 08:43 AM
Mar 2013

It's more than double what a great many folks currently make an hour, but it is less than what the minimum wage would be if all boats were rising equally.

 

sulphurdunn

(6,891 posts)
26. That's about twice
Tue Mar 26, 2013, 09:04 AM
Mar 2013

the federal poverty level for a family of four. The median home mortgage is around $16K annually, rents about half that. That income also puts the family of four in the 15% income tax bracket. Figure approximately 5% state income tax 5% sales tax most places, not to mention other costs like utilities, health coverage, food, other costs such as raising kids and even tax deductions won't do much for them. That income definitely won't vault you into the middle class. Also, since wages have been flat for 30 years, the entry level wage is probably the wage for a long time to come.

hfojvt

(37,573 posts)
33. sounds pretty darn good to me
Tue Mar 26, 2013, 10:09 AM
Mar 2013

it's about $3 an hour more than I make and I am a supervisor who has been on the job for over ten years.

But not that good if it does not include health benefits.

A HERETIC I AM

(24,365 posts)
57. So....why, out of curiosity...
Tue Mar 26, 2013, 10:57 PM
Mar 2013

Why is it you "only" make $15.50 an hour?


How old are you?

Wht do you do other than "supervisor"?

In the past on this website I have been called a "plucky bootstrap puller". I'll take that if I have to, but I just can not understand how a grown man or woman can or will accept less than a comfortable living for their efforts.

You LEASE your services. Why accept less than the lease is worth?

I'm 53 and I am making my age and a bit better with nothing more than a CDL and a HS diploma.


So why is it you only make fifteen fifty?

hfojvt

(37,573 posts)
60. What is a comfortable living?
Tue Mar 26, 2013, 11:16 PM
Mar 2013

What am I supposed to do, click my heels together and say "there's no place like above the median income, there's no place like above the median income ..."

Oh wait, should I goto Devry?

Actually a classmate of mine went to Devry. He's in Bahrain right now.

I don't think I need any more money. There's really nothing I want to buy, except maybe a driveway. Two years ago I was only making $12,000 a year (after I paid for health care) and I made about that much since I started working part-time in October 2006.

People, myself included, take what they can get and look for better. Better is not always within sight or within reach.

A HERETIC I AM

(24,365 posts)
62. That is a question only you can answer
Tue Mar 26, 2013, 11:37 PM
Mar 2013

and it is a different answer for everyone.

If you're happy making the rate you're making then fine, goodonya.

But in your previous posts in this thread you seem to be bemoaning Ford workers who make twice that (or used to, anyway).

It is an unfortunate reality in this country that the days of being able to graduate High School, get a Union Card and be able to make a living - that is to say, live in a decent house, raise a family, be able to afford or at least come close to paying for the kids college, drive something above a beater and take vacations ALL THE WHILE having health care and retirement sorted out, ARE LONG GONE.

But I never could understand the proclivity for some Americans to display acrimony for those that are still able to do just that.

hfojvt

(37,573 posts)
65. except you are not talking about reality
Wed Mar 27, 2013, 12:41 AM
Mar 2013

you make it sound like in the 1960s and 1970s that EVERYBODY was rich. That EVERYBODY had one of those good paying union jobs.

But that was never true. Those jobs were never THAT widely available. Just like now, they only went to those who, for whatever reason, either family connection, skills, luck, determination, somehow won the "job lottery" and got a winning ticket.

Some people got their ticket on the good job train, and they rode through life in comfort and style, while others, even in the 1970s and 1960s (the glory days of pre-Reagan) others did shitty jobs that they hated for shitty pay and benefits, or they pounded the pavement basically begging for work.

I mean, here is some data from the glory days of 1977, shares of aggregate income by quintile - 4.4%, 10.3%, 17.0%, 24.8%, 43.6%, 16.1%.

The richest 5% got 16.1% of the income in 1977. The poorest 40% got 14.7%. The richest 20% got 43.6% of the income in 1977.

1967, which is as far back as i go shows the top 5% with 17.5% and the bottom 40% with 14.8%.

Somehow, I don't believe that the bottom 40% was just rolling in good-paying union jobs.

As for acrimony, I believe I am only asserting that $19 is not that bad for pay in this country. It is not as much as it used to be, but it is still more than many other Americans are making, and those others often have much worse benefits.

I went for many years working jobs without getting paid vacation or paid holidays or paid sick leave.

Maybe somebody should cry for that part of Argentina.

BrotherIvan

(9,126 posts)
40. So the idea that the person who MAKES the product you are buying
Tue Mar 26, 2013, 02:22 PM
Mar 2013

is a worthless, dispensable automaton but the guy in the suit who sits in board meetings is the important one? Especially when dealing with products that require safety such as a car or a plane? Have you read all the articles on the airplane manufacturing that was shipped overseas to save on labor costs and ended up literally falling apart in the air, wings falling off because of cheap materials or improper construction, landing gear that not only failed to come down but fell off when engaged?

I'm sorry, but you should really change your screen name. Nye Bevan was a champion for LABOR. It's a disgrace.

If you haven't noticed, there has been a sea-change where companies and shareholders expect extraordinary profits. That has to come from somewhere and so CEOs have decided it should come from the worker's hides. It used to be a healthy company made 10-30% profit. Now they want to make 100-200% with gigantic bonuses and don't forget executive perks like the company jets the carmaker CEOs flew to Washington. No longer is the skilled labor required to make a quality product considered part of the equation. Because consumers are so addicted to the cheapest price regardless of quality, and because of the race to the bottom in wages, people are willing to accept that it's just fine that workers should be paid half what they were THIRTY YEARS AGO.

AND YOU BOUGHT THIS DRIVEL????

Nye Bevan

(25,406 posts)
54. When I had an entry-level job in the 1980s I couldn't even afford an apartment of my own.
Tue Mar 26, 2013, 10:30 PM
Mar 2013

Let alone support a family of 4.

Response to xchrom (Original post)

NewJeffCT

(56,828 posts)
15. And, I bet this CEO
Tue Mar 26, 2013, 08:36 AM
Mar 2013

Probably thinks he should have made more, and that he was being austere by taking only $21 million instead of $31 or $41 million.

Response to xchrom (Original post)

Hugin

(33,112 posts)
20. So... He's the new Jack Welch and all the MBA lemmings are following in his lead?
Tue Mar 26, 2013, 08:46 AM
Mar 2013

We have to starve the workers to save the company!11!!i!

Charming.

edhopper

(33,556 posts)
23. And you still hear people
Tue Mar 26, 2013, 08:56 AM
Mar 2013

claim that the rich aren't getting richer on the backs of the workers.
That the increase in wealth of the 1% isn't coming out of the pockets of the middle class.
When will everyone wake up?

Dustlawyer

(10,495 posts)
27. The outsourcing was designed to lower our pay out of desperation for a job.
Tue Mar 26, 2013, 09:11 AM
Mar 2013

Ship the jobs over seas and they come back at half, or almost half pay. It is wage laundering!

BrotherIvan

(9,126 posts)
39. ^^This!^^
Tue Mar 26, 2013, 02:06 PM
Mar 2013

Being competitive globally is newspeak for race to the bottom in standard of living. But all these companies will soon find like Walmart that one of these days their sales will dry up because no one can afford their products.

 

Scuba

(53,475 posts)
29. If we had Medicare for All, the worker's health insurance costs wouldn't be in car prices.
Tue Mar 26, 2013, 09:53 AM
Mar 2013

Want American businesses to be more competetive? Level the playing field by enacting Medicare for All.

HughBeaumont

(24,461 posts)
35. It's one of those things that makes all the sense in the world, which is why it'll never happen.
Tue Mar 26, 2013, 10:16 AM
Mar 2013

1. "The Big Club" has an unspoken rule that you don't step on the toes of anyone in "The Big Club". Big Auto, Big Pharma and Big Insurance all go to the same club, all with the same Washington lobbyists vying to petition more advantage over us. It's a huge illusion of "competition" when they all know that sort of nonsense is for the underlings.

2. Universal Health Care being implemented would make this an employEE's market, not an employERs market. The bennies (if they offer them) are one of the ways they keep the slaves shackled and obedient. How many would start their own businesses if health care costs were no longer a factor? How many would leave shitty jobs? How many employees would demand better pay knowing that employers no longer have the excuses of "legacy costs" and "health care costs" to fall back on? Employers could no longer legally practice ageism . . . "Sorry, but your bullshit excuse of health care costs are no longer a factor. It's no concern of yours how old or what condition I am."

Ikonoklast

(23,973 posts)
31. I will say this for Mullaly...he saved Ford from bankruptcy.
Tue Mar 26, 2013, 10:02 AM
Mar 2013

Before he was hred to run the company, they were on track to fail, even if 2008 hadn't happened.

Ford Motor was in serious trouble from previous years of inept management and a product line that was stagnant.

Agschmid

(28,749 posts)
46. Yup.
Tue Mar 26, 2013, 04:00 PM
Mar 2013

I mean the company actually discontinued the flagship "Taurus" before he got to the helm... horrible decision making.

"Corporate overlords" and all Mullaly has been known to build success from many things he touches, see the Boeing 777 program.

hfojvt

(37,573 posts)
37. you expect somebody to live on just THAT?
Tue Mar 26, 2013, 10:53 AM
Mar 2013

How?

One of the troubles with numbers is this.

Suppose he gave up $19 million in salary - or 90% of his pay, and instead gave that money to the workers. How much money would each worker get?

Well, Ford has about 166,000 workers. So each worker would get a whopping $114.45 which would increase their pay by about 0.3%.

Of course, the article mentions that the CEO also has some $300 million worth of Ford stock.

 

just1voice

(1,362 posts)
47. Ford is also charging 30+ grand for a new car
Tue Mar 26, 2013, 05:43 PM
Mar 2013

playing along with corrupt bank practices of charging people a lot more than they can actually afford.

Thinkingabout

(30,058 posts)
52. Now if the executives salaries was cut by half then the company could return the workers
Tue Mar 26, 2013, 09:54 PM
Mar 2013

Salaries could return to their full rate and there would be larger dividends. The company could upgrade and there would be lots of winners.

Nye Bevan

(25,406 posts)
55. Nope. Do the math.
Tue Mar 26, 2013, 10:35 PM
Mar 2013

Executive compensation at Ford is about $65 million. So you are proposing to pay $32.5 million of this to the workers. Ford has about 164,000 workers. So you would be able to increase each worker's salary by about $200 per YEAR.

A HERETIC I AM

(24,365 posts)
63. On the other hand, think about this;
Wed Mar 27, 2013, 12:10 AM
Mar 2013

I haul cars for a living, and have been involved in automobile marketing and movement for most of my adult life. I have hauled literally thousands of Ford products.

I have roughly 17,000 compatriots in the industry, nationwide.


The average American buys a new car ...what? Every ten years? 5? 15? Whatever.

On the Monroney Sticker of each new car the "transportation" charges are listed, plain as day. They can vary from as little as $250 to over $1500, depending on model and manufacturer. It has NOTHING to do with distance from factory to dealer, BTW. There is a dealer right across the street ....literally ... across the street from Ford's Wayne Assembly Plant in Metro Detroit. The shipping charges on the Monroney stickers on that dealers lot on the vehicles made right across the street are the same as a dealer in Anchorage selling the same unit.


Would it make one single iota of a difference to you if that figure on the sticker was $20 higher? Really? For something you buy once a decade?

Guess how much of a difference in MY life and my 17,000 compatriots it would make if we all got $20 per car more than we are getting now.

In my industry, like so many others, the workers are nickel and dimed to death over sums that could EASILY be raised or acquired from other sources.

I make basically the same amount, in non adjusted dollars, as I was making in 1988 when I first started working for Buick Motorsports. The thing is, back then a Motel 6 rarely cost more than $20 a night, most less than $26 and some as low as $15.00 a night. Try and find a Motel 6 for less than $35.00 a night these days.


Ford builds vehicles - The Expedition is a perfect example - with $4000 or more profit built in. If they would simply build cars people want to buy, which they do in Europe, BTW, they could charge almost anything they wanted and pay their employees better.

It is my sincere hope that someday, some dickhead at a major distributer or manufacturer will figure out that the reason the damage rate is so high (around 3% or so, maybe a bit less in the new car segment) in the auto transport industry is because the rates they pay to the transport companies make it so those companies will hire any dipshit to do the job and continue to screw the experienced and competent guy charged with getting your car the final miles to the dealer, the most hazardous miles it travels.

lpbk2713

(42,751 posts)
64. There was a little story created with CEO Mulally in mind ...
Wed Mar 27, 2013, 12:15 AM
Mar 2013



A CEO, a tea party member, and a union worker are all sitting at a table when a plate with a dozen cookies arrives. Before anyone else can make a move, the CEO reaches out to rake in eleven of the cookies. When the other two look at him in surprise, the CEO locks eyes with the tea party member. “You better watch him,” the executive says with a nod toward the union worker. “He wants a piece of your cookie.”

Ikonoklast

(23,973 posts)
68. The only real problem with that scenario is this: Without Mulally, there was a very real chance
Wed Mar 27, 2013, 09:39 AM
Mar 2013

Ford Motor might not have even made it past 2008. They were in trouble long before the financial meltdown.

There would literally be *no* cookies for anyone to share, as it was a very near thing for Ford; they were in dire financial straights.

He sold under-performing assets, he cut losing product lines.

Mullaly mortgaged every single thing that Ford owned, factories, land, machinery, buildings, anything he could use as collateral in order to raise money, right down to having a lien put on the Ford "Blue Oval" insignia.

He saved Ford from total financial disaster, flat out.

The company would have ended up being dramatically smaller, employing far less today than they do if it wasn't for him.

Duer 157099

(17,742 posts)
70. Then he's probably worth about $500,000/year salary
Wed Mar 27, 2013, 06:03 PM
Mar 2013

I doubt anyone would have a problem with that.

But that isn't his salary/compensation, is it?

Thus, the problem.

sfpcjock

(1,936 posts)
84. Hate to say it, but for $21 million Ford under him ignores design for style...
Fri Mar 29, 2013, 02:48 PM
Mar 2013

1. The new Escape has a cramped drivers seat with a short throw. Couple that with a GIANT "aircraft" center "cupholder" console that cramps the h@ll out of your right leg and the car is undriverable. What's happened here, Alan? Many drivers are over six feet tall in America.

2. The gas bag Explorer pulls wildly to one side then the other under hard acceleration. It is truly scary to test drive.

The solution to the above is obviously the Chevy Equinox/GMC Terrain which can even be bought with radar crash avoidance system as a $300 option. So I bought a 2011. Just trying to help
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