FacebookTwitterGoogle+RedditEmail

Business Leaders Agree: Inequality Hurts The Bottom Line

For decades, big business leaders have warned that redistributing wealth is bad for business. Taxing the rich to pay for infrastructure and education, they say, will kill the goose that lays the golden egg.

But what if it’s the opposite? What if decades of stagnant wages and growing inequality are scrambling the golden egg and stifling the economy?

A growing body of research suggests that’s exactly what’s happening. And a growing number of business leaders now agree.

Jim Sinegal, the retired CEO of Costco, famously fended off Wall Street pressure to cut wages and made an eloquent case for a higher federal minimum wage. “The more people make, the better lives they’re going to have and the better consumers they’re going to be,” Sinegal told the Washington Post years ago.

“Our country needs less inequality and more opportunity,” agreed former Stride Rite CEO Arnold Hiatt in 2015. “Instead, we’re moving toward a society that will be economically and politically dominated by the sons and daughters of the Forbes 400.”

One of the clearest voices on the business risks of growing inequality is Peter Georgescu, a retired ad man from one of the world’s largest marketing firms. His new bookCapitalists Arise: End Economic Inequality, Grow the Middle Class, Heal the Nation, is a stinging indictment of the way business has been done in our country.

“For the past four decades, capitalism has been slowly committing suicide,” he writes — especially shareholder capitalism, where businesses operate for the benefit of shareholders and no one else.

“Shareholder primacy has become a kind of cancer that needs to be eradicated before it destroys our way of life,” Georgescu warns.

Those views were recently echoed in a letter written to CEOs by Larry Fink, chairman of the investing giant Blackrock.

In January, Fink called on the companies Blackrock invests in to “understand the societal impact of your business as well as the ways that broad, structural trends — from slow wage growth to rising automation to climate change — affect your potential for growth.”

Businesses, Fink exhorted, need a social purpose other than making money.

Reversing inequality will require robust government action at all levels. This includes boosting the minimum wage, fairly taxing big businesses and the rich, and making robust public investments in education, infrastructure, and individual opportunity.

We also need government to crack down on wage theft and discrimination, and to protect the right to organize. Unions and activists have demanded these changes for years.

So what can supportive businesses do? Everything.

They can encourage more employees to be owners. Employees already have an ownership stake at companies such as Publix supermarkets and Southwest Airlines.

They can raise their wage floor to close the monstrous pay gap between top management and average workers — a policy long supported by business guru Peter Drucker. And they can publicly speak out in favor of policies that reduce inequality.

If nothing else, they can stop paying dues to business associations that lobby against sensible taxes and labor protections — like the U.S. Chamber of Commerce and the National Federation of Independent Businesses, which tend to be much more conservative than their members.

Can more business leaders “wake up and take action,” Georgescu challenges? Or will they “continue doing business the ways it’s been done… until the whole system risks falling apart?”

Corporate leaders should stand with ordinary Americans to push for serious public policy to halt the nation’s slide towards greater inequality.

More articles by:
Weekend Edition
July 20, 2018
Friday - Sunday
Paul Atwood
Peace or Armageddon: Take Your Pick
Paul Street
No Liberal Rallies Yet for the Children of Yemen
Nick Pemberton
The Bipartisan War on Central and South American Women
Jeffrey St. Clair
Roaming Charges: Are You Putin Me On?
Andrew Levine
Sovereignty: What Is It Good For? 
Brian Cloughley
The Trump/NATO Debacle and the Profit Motive
David Rosen
Trump’s Supreme Pick Escalates America’s War on Sex 
Melvin Goodman
Montenegro and the “Manchurian Candidate”
Salvador   Rangel
“These Are Not Our Kids”: The Racial Capitalism of Caging Children at the Border
Matthew Stevenson
Going Home Again to Trump’s America
Louis Proyect
Jeremy Corbyn, Bernie Sanders and the Dilemmas of the Left
Patrick Cockburn
Iraqi Protests: “Bad Government, Bad Roads, Bad Weather, Bad People”
Robert Fantina
Has It Really Come to This?
Russell Mokhiber
Kristin Lawless on the Corporate Takeover of the American Kitchen
John W. Whitehead
It’s All Fake: Reality TV That Masquerades as American Politics
Patrick Bobilin
In Your Period Piece, I Would be the Help
Ramzy Baroud
The Massacre of Inn Din: How Rohingya Are Lynched and Held Responsible
Robert Fisk
How Weapons Made in Bosnia Fueled Syria’s Bleak Civil War
Gary Leupp
Trump’s Helsinki Press Conference and Public Disgrace
Josh Hoxie
Our Missing $10 Trillion
Martha Rosenberg
Pharma “Screening” Is a Ploy to Seize More Patients
Basav Sen
Brett Kavanaugh Would be a Disaster for the Climate
David Lau
The Origins of Local AFT 4400: a Profile of Julie Olsen Edwards
Rohullah Naderi
The Elusive Pursuit of Peace by Afghanistan
Binoy Kampmark
Shaking Establishments: The Ocasio-Cortez Effect
John Laforge
18 Protesters Cut Into German Air Base to Protest US Nuclear Weapons Deployment
Christopher Brauchli
Trump and the Swedish Question
Chia-Chia Wang
Local Police Shouldn’t Collaborate With ICE
Paul Lyons
YouTube’s Content ID – A Case Study
Jill Richardson
Soon You Won’t be Able to Use Food Stamps at Farmers’ Markets, But That’s Not the Half of It
Kevin MacKay
Climate Change is Proving Worse Than We Imagined, So Why Aren’t We Confronting its Root Cause?
Thomas Knapp
Elections: More than Half of Americans Believe Fairy Tales are Real
Ralph Nader
Warner Slack—Doctor for the People Forever
Lee Ballinger
Soccer, Baseball and Immigration
Louis Yako
Celebrating the Wounds of Exile with Poetry
Ron Jacobs
Working Class Fiction—Not Just Surplus Value
Perry Hoberman
You Can’t Vote Out Fascism… You Have to Drive It From Power!
Robert Koehler
Guns and Racism, on the Rocks
Nyla Ali Khan
Kashmir: Implementation with Integrity and Will to Resolve
Justin Anderson
Elon Musk vs. the Media
Graham Peebles
A Time of Hope for Ethiopia
Kollibri terre Sonnenblume
Homophobia in the Service of Anti-Trumpism is Still Homophobic (Even When it’s the New York Times)
Martin Billheimer
Childhood, Ferocious Sleep
David Yearsley
The Glories of the Grammophone
Tom Clark
Gameplanning the Patriotic Retributive Attack on Montenegro
FacebookTwitterGoogle+RedditEmail