The Upward Mobility Myth

[HouseApe]

In the past, a lot of companies, large and small looked after their employees. A patriarchal dictatorship brings a huge amount of loyalty, and potential for growth. However, such management techniques cannot ebb and flow with the economy, they are in it for the long term, and as a result, it is rare to see in a publically traded company. Some management guru's state the model is seriously dated, I personally don't think so, but it does require a much better handle on financial management than most of todays companies are capable of. Spreadsheet MBA's and true visionary management do not mix.

A friend had upwards of 3000 employees, had his own onsite medical clinic for routine matters. In addition, he provided quite a number of company houses, (not the company town of years past, i think he had a hundred or so properties), but a place to live for people whose wages were on the low side of the scale. Here is the cool part, he knew every employee, and they knew him. He was the proverbial grandfather type of boss, and even if you were a newbie and 19, he took the time to get to know you. As a result, his business grew and grew. But he passed away. Then the company went public, and today, I think they might have 100 employees if that.

The right person can look out for both shareholders and employees. Their goals in the long term are not contradictory. In the short term, no. Some years things are going to take a real header due to the high fixed overhead costs, and no amount of producitivty gains or loyalty will help.

Some unions do look after their members, and do a great job at it. Many however, are subject to the same short sided thinking of a public company. And as a result, they have their own interests at heart, not their membership. Effectively, they are the tail, and when economic fluctuations happen, they go alone for the ride, and the members get dragged through the dirt when the employer either pulls out, or goes bankrupt.

Ron

I had a similar experience. I worked for a small software engineering firm. We devoloped a nice set of products over the years. The owner was a great guy, a great manager and a great salesman. I knew he had my back and I had his. He ended up having a heart attack and didn't have the energy to run the company any more. He sold out for mega-bucks to a giant outsourcing firm (think Ross Perot).

The new company really only bought us for our customer base. They refused to invest any money in the software, only wanting to sell their product line to our customers. Our product became stagnant, our customers left, I left, and eventually the husk of what was left was sold out to a much smaller competitor. The much smaller competitor reduced pay and dramatically cut benefits.

Point is, there are great companies and great heads of companies. But they don't last. People move on. I would much prefer to have my fate in the hands of a labor union than a company head who just sees me as a replaceable machine. At least with a union, I can vote on policy.

 

[CJ.23]

Nobody "takes" anything except socialist pickpockets who tax a man's last penny in some misguided notion that the nanny state government will somehow take care of you. We earn our money. It's easy to talk about "giving back" when you're not the one doing the giving, isn't it?

I'm a democratic socialist, a member of Tony Blair's Labour Party in the uk where I reside today. I have looked before at the costs of a Welfare State, and it's benefits as a safety net and argued the case for it. To take just one aspect, from the CF debate on the subject

It is a cheap, efficient system which delivers almost two thirds the infant mortality rate of the USA, {USA 7.2 infants per 1,000, UK 5.9} for almost a third of the cost to the individual. It is hard to find critical illness survival rates, but they appear comparable to me ; in the USA average lifespan is 70 years, in Britain 72, in Sweden 73. The World Health Organisation rates US health care 37th (corrected) in the world, after Britain at 18, Norway at 11th, the UK at 18th, Sweden at 23rd and Denmark at 34th. Finally, looking at customer satisfaction - the figure for the USA was 40% - the figure for Britain was 57%, and Denmark achieved - 91%. Yes thats right, 91% satisfied customers.

So, to conclude my opening remarks, Social Medicine strike me as desirable. Here are the costs per person from 1998

USA ......$4,178
Denmark $2,133
Sweden $1,745
UK ........$1,461

$1,461 to $4,178 average spend. That is quite a difference...

source: http://dll.umaine.edu/ble/U.S. HCweb.pdf

I therefore contend that based on personal experience, social justice and all indicators socaliased medicine is a desirable goal.

Sadly the debate never proceeded as the anti the motion team were unable to respond owing to unrelated hassles; we did not win, the debae just petered out. If you would like to debate socialised mediceine, or welfare socialism, just pm me. Providing we can stick to concrete examples and hard figures, I'm happy.

Socialised Medicine is far cheaper than the Private Sector.

The main reason is

The reasons for this are varied but the report at http://dll.umaine.edu/ble/U.S. HCweb.pdf cites one very real issue - between 19.3 and 24% of the US medical spend goes on administrative costs. For profit hospitals actually manage to make admin take up 34.9% of the costs incurred. Er, how difficult is sick guy comes in, we treat him?

You can read the rest of my analysis and the debate as far as it went at
http://www.christianforums.com/t738468-socialized-healthcare.html

cj x

 

[whatbogsends]

NO - you're misreading the statist. 6% in that if you follow these rules - you have a 6% chance of actually living in poverty. It is not saying that 6% of the people who follow these rules lives in poverty.

You do understand how statistics work, yes? Those two statements are identical - not only do you have a 6% chance of living in poverty if you follow those rules, but 6% of the people who do follow those rules live in poverty. That is where that 6% number came from.

 

[billwald]

Social Security is the safety net. Without it a third of Americans over 65 would be living in poverty.

 

[HouseApe]

Social Security is the safety net. Without it a third of Americans over 65 would be living in poverty.

I never understood the idea of privatizing social security. To me, social security should be there at the minimum level needed to keep you out of poverty. I personally have a savings plan to hopefully give me something better. Everybody else should too. However, if my savings plan goes Enron on me, it is good to know the landing pad won't be the gutter.

If the Feds don't like the return they are getting on SS funds, invest them better. If somebody thinks I can invest my money better than a trained financial analyst, they are horribly mistaken. And I actually trust the government can create an economy of scale in hiring these guys better than everybody going out and hiring their own.

 

[arnegrim]

Curious. How? If a chap is born in to a family which is wealthy, and inherits twenty million dollars at 18, how are his chances teh same as a person who was born dirt poor?

Genuine question.

cj x

Do you think that money overcomes character? integrity? responsibility?

 

[arnegrim]

At least with a union, I can vote on policy.

Really? And how much does your vote affect policy if you are not in lockstep with the union?

 

[arnegrim]

I never understood the idea of privatizing social security. To me, social security should be there at the minimum level needed to keep you out of poverty. I personally have a savings plan to hopefully give me something better. Everybody else should too. However, if my savings plan goes Enron on me, it is good to know the landing pad won't be the gutter.

If the Feds don't like the return they are getting on SS funds, invest them better. If somebody thinks I can invest my money better than a trained financial analyst, they are horribly mistaken. And I actually trust the government can create an economy of scale in hiring these guys better than everybody going out and hiring their own.

You do understand the the privitization that GWB is touting is strictly voluntary don't you?

 

[CJ.23]

Do you think that money overcomes character? integrity? responsibility?

No I don't. I think money bypasses many of those things, by allowing you not to need to express them. I have a great deal of respect for those who have struggled to make it for themselves, and for those who have taken their advanatages and run with them. I just don't think there is a level playing field. Inheritance does not allow that.

I'm not adverse to inheritance a all btw, I just think it makes things easier if you are wealthy to prosper further.

cj x

 

[arnegrim]

No I don't. I think money bypasses many of those things, by allowing you not to need to express them. I have a great deal of respect for those who have struggled to make it for themselves, and for those who have taken their advanatages and run with them. I just don't think there is a level playing field. Inheritance does not allow that.

I'm not adverse to inheritance a all btw, I just think it makes things easier if you are wealthy to prosper further.

cj x

That's true... to a point. But what stops someone from building their wealth to provide an inheritance for generations?

 

[CJ.23]

That's true... to a point. But what stops someone from building their wealth to provide an inheritance for generations?

Nothing at all, and their children will prosper because of it. I don't think that is a bad thinga at all. I just think we don't all start off woith a level playing field. There are plenty of idle rich, and determined hard working poor. One day the latter maybe rich, but they will ahve to strive harder to atatin it than if they inherited from dad.

Three of my siblings got their inheritance early, and prospered and did well for themselves. When I was born, after hey had all attained adulthood and got the dosh which my parents had given them on maturity, their was not alot left. I have not inherited anything save a one off $1000 from my grandmother, so don't own my own house or have much material wealth. Nonetheless I enjoy life and think they all did very well, and i respect them for it, and bear no gruge at all. They have looked after my parents, where i find it hard to meet my own survival needs; I don't resent or regret this. I am on (well technically just below) the breadline, but am happy. We live on about $8,000 a year after paying my rent; my wife and I survive, and she works full time and I work night shifts, but we are not well paid. So what? Our needs are simple; it hosuses and feeds us and 3 cats. ( I would have been much better off but by marrying an immigrant from the USA I lost state benefits. )

However, I do not believe it was a level playing field, based on my experience.

cj x



cj x

 

[arnegrim]

Nothing at all, and their children will prosper because of it. I don't think that is a bad thinga at all. I just think we don't all start off woith a level playing field. There are plenty of idle rich, and determined hard working poor. One day the latter maybe rich, but they will ahve to strive harder to atatin it than if they inherited from dad.

Well of course... but the point is that someone had to strive hard in order to attain that goal... whether it was fathers or grandfathers or further, noone is handed anything without the effort and sacrifice being paid by someone.

Three of my siblings got their inheritance early, and prospered and did well for themselves. When I was born, after hey had all attained adulthood and got the dosh which my parents had given them on maturity, their was not alot left. I have not inherited anything save a one off $1000 from my grandmother, so don't own my own house or have much material wealth. Nonetheless I enjoy life and think they all did very well, and i respect them for it, and bear no gruge at all. They have looked after my parents, where i find it hard to meet my own survival needs; I don't resent or regret this. I am on (well technically just below) the breadline, but am happy. We live on about $8,000 a year after paying my rent; my wife and I survive, and she works full time and I work night shifts, but we are not well paid. So what? Our needs are simple; it hosuses and feeds us and 3 cats. ( I would have been much better off but by marrying an immigrant from the USA I lost state benefits. )

However, I do not believe it was a level playing field, based on my experience.

cj x

Sure it is... you have the opportunity to attain what your parents did... money to hand down. There are a lot of people who are not interested in that... and God bless them, but that skews the idea of a 'playing field' at least as much as inheritance does.

 

[Milla]

That has been my experience in Britain. I believe some American unions were however controlled by crime or communists?

I think that was the Teamsters, mostly.

 

[Milla]

From the experience I've had with friends who are in unions, the answer is absolutely.

My union is pretty good about taking care of its members. I know some people who've used it for despute resolution with our employer and had good results.

 

[arnegrim]

The unions look out for the unions. It may have started out as looking after members, but it has diverted far from that place.

 

[Milla]

The unions look out for the unions. It may have started out as looking after members, but it has diverted far from that place.

The difference that for a union, looking out for its member pretty much is looking out for itself. Its business is to keep members pacified, and generally, the best way to do so is by sucessfully lobbying for them and defending them in conflicts with their employers and contract negotiations.

 

[nvxplorer]

That's true... to a point. But what stops someone from building their wealth to provide an inheritance for generations?

Mostly lifespan, but also competition, the economic structure, power structures, legal structures, among others.

Simple arithmetic will tell you that someone who begins life with a $20 million inheritence has a decided advantage over someone who inherits nothing.

Capital creates wealth (more capital). A college degree (can lead to) creating wages. With luck and prudent life choices, a college grad can succeed and possibly build a fortune. Few actually acheive this because of the constraints and costs of raising a family. Most people care more about family life than becoming billionaires (this is a good thing).

The person who inherits $20 million has an advantage that no amount of education or determination can equal on its own. Just think about it. Twenty million dollars represents $50,000 per year for fourty years. It's a huge sum. Of course, $20 million is an arbitrary figure. Some inherit more, and most inherit less, but the point is, inheritence is the sum total of one or several lifetimes. Someone who inherits a fortune, in effect, begins his life at an economically mature point. At birth, the privileged child's life already has accumulated the wealth of several generations.

Money doesn't grow on trees, and it doesn't grow overnight. It takes time to amass wealth, and wealth grows exponentially - the more you have, the faster it is accumulated.

The playing field is very lopsided. When you consider that 5% of the population controls over 60% of the wealth, and that wealth gets passed from generation to generation, it's easy to see why upward mobility is indeed a myth.

 

[nvxplorer]

The unions look out for the unions. It may have started out as looking after members, but it has diverted far from that place.

Politically, yes, the unions are concerned with influence. However, unions still are the only means for labor to make demands from employers. Individual workers are powerless to enter into contractual agreements, so unions provide the only avenue to bargain for better working conditions, higher wages, etc.

No CEO would dream of accepting a position without a contract. Likewise, no supplier, distributer or client would do business without a signed agreement. Why should a worker be expected to operate any differently?

 

[HouseApe]

Mostly lifespan, but also competition, the economic structure, power structures, legal structures, among others.

Simple arithmetic will tell you that someone who begins life with a $20 million inheritence has a decided advantage over someone who inherits nothing.

Capital creates wealth (more capital). A college degree (can lead to) creating wages. With luck and prudent life choices, a college grad can succeed and possibly build a fortune. Few actually acheive this because of the constraints and costs of raising a family. Most people care more about family life than becoming billionaires (this is a good thing).

The person who inherits $20 million has an advantage that no amount of education or determination can equal on its own. Just think about it. Twenty million dollars represents $50,000 per year for fourty years. It's a huge sum. Of course, $20 million is an arbitrary figure. Some inherit more, and most inherit less, but the point is, inheritence is the sum total of one or several lifetimes. Someone who inherits a fortune, in effect, begins his life at an economically mature point. At birth, the privileged child's life already has accumulated the wealth of several generations.

Money doesn't grow on trees, and it doesn't grow overnight. It takes time to amass wealth, and wealth grows exponentially - the more you have, the faster it is accumulated.

The playing field is very lopsided. When you consider that 5% of the population controls over 60% of the wealth, and that wealth gets passed from generation to generation, it's easy to see why upward mobility is indeed a myth.

Certainly people want to set their children up so that they do not have to struggle as much as they did. However, leaving the nation's investment capital in the hands of these children who may or may not have any talent is risky and wasteful.

I would much prefer to 100% inheritance tax after leaving say a few million for each kid. The money would be used to provide very low interest, very long term loans to entrepreneurs who do have the brain power to create new wealth.

 

[nvxplorer]

Certainly people want to set their children up so that they do not have to struggle as much as they did. However, leaving the nation's investment capital in the hands of these children who may or may not have any talent is risky and wasteful.

Completely agree. In our mature capitalistic sytem, the economic structure is composed of capital (the top few percent), those who service the capital (perhaps the next 10% - lawyers, financial advisors, business managers, etc.), and the rest who do the actual production.

Capital is self serving. Witness Paris Hilton. Talent, brains, drive, etc. are irrelevant when one is part of the capitalist class. All those attributes can be purchased, and purchased they indeed are.

While leaving capital in the hands of risky decendents may seem unwise (and sometimes this bears out), in actuality, those who inherit do not need to be involved with finances if they so choose.

I would much prefer to 100% inheritance tax after leaving say a few million for each kid. The money would be used to provide very low interest, very long term loans to entrepreneurs who do have the brain power to create new wealth.

I don't have a source (too lazy to search), but I understand Japan has limitations on passing wealth. I believe it can be passed on for only a certain number of generations, but I may be wrong. Otherwise, I agree with you on this as well.