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
September 21, 2018
Friday - Sunday
Paul Street
Laquan McDonald is Being Tried for His Own Racist Murder
Brad Evans
What Does It Mean to Celebrate International Peace Day?
Alexandra Isfahani-Hammond
Hurricane Florence and 9.7 Million Pigs
Nick Pemberton
With or Without Kavanaugh, The United States Is Anti-Choice
Andrew Levine
Israel’s Anti-Semitism Smear Campaign
Jim Kavanagh
“Taxpayer Money” Threatens Medicare-for-All (And Every Other Social Program)
Jonathan Cook
Palestine: The Testbed for Trump’s Plan to Tear up the Rules-Based International Order
Jeffrey St. Clair
Roaming Charges: the Chickenhawks Have Finally Come Back Home to Roost!
David Rosen
As the Capitalist World Turns: From Empire to Imperialism to Globalization?
Jonah Raskin
Green Capitalism Rears Its Head at Global Climate Action Summit
James Munson
On Climate, the Centrists are the Deplorables
Robert Hunziker
Is Paris 2015 Already Underwater?
Arshad Khan
Will Their Ever be Justice for Rohingya Muslims?
Jill Richardson
Why Women Don’t Report Sexual Assault
Dave Clennon
A Victory for Historical Accuracy and the Peace Movement: Not One Emmy for Ken Burns and “The Vietnam War”
W. T. Whitney
US Harasses Cuba Amid Mysterious Circumstances
Nathan Kalman-Lamb
Things That Make Sports Fans Uncomfortable
George Capaccio
Iran: “Snapping Back” Sanctions and the Threat of War
Kenneth Surin
Brexit is Coming, But Which Will It Be?
Louis Proyect
Moore’s “Fahrenheit 11/9”: Entertaining Film, Crappy Politics
Ramzy Baroud
Why Israel Demolishes: Khan Al-Ahmar as Representation of Greater Genocide
Ben Dangl
The Zapatistas’ Dignified Rage: Revolutionary Theories and Anticapitalist Dreams of Subcommandante Marcos
Ron Jacobs
Faith, Madness, or Death
Bill Glahn
Crime Comes Knocking
Terry Heaton
Pat Robertson’s Hurricane “Miracle”
Dave Lindorff
In Montgomery County PA, It’s Often a Jury of White People
Louis Yako
From Citizens to Customers: the Corporate Customer Service Culture in America 
William Boardman
The Shame of Dianne Feinstein, the Courage of Christine Blasey Ford 
Ernie Niemi
Logging and Climate Change: Oregon is Appalachia and Timber is Our Coal
Jessicah Pierre
Nike Says “Believe in Something,” But Can It Sacrifice Something, Too?
Paul Fitzgerald - Elizabeth Gould
Weaponized Dreams? The Curious Case of Robert Moss
Olivia Alperstein
An Environmental 9/11: the EPA’s Gutting of Methane Regulations
Ted Rall
Why Christine Ford vs. Brett Kavanaugh is a Train Wreck You Can’t Look Away From
Lauren Regan
The Day the Valves Turned: Defending the Pipeline Protesters
Ralph Nader
Questions, Questions Where are the Answers?
Binoy Kampmark
Deplatforming Germaine Greer
Raouf Halaby
It Should Not Be A He Said She Said Verdict
Robert Koehler
The Accusation That Wouldn’t Go Away
Jim Hightower
Amazon is Making Workers Tweet About How Great It is to Work There
Robby Sherwin
Rabbi, Rabbi, Where For Art Thou Rabbi?
Vern Loomis
Has Something Evil This Way Come?
Steve Baggarly
Disarm Trident Walk Ends in Georgia
Graham Peebles
Priorities of the Time: Peace
Michael Doliner
The Department of Demonization
David Yearsley
Bollocks to Brexit: the Plumber Sings
FacebookTwitterGoogle+RedditEmail