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You’ve probably heard that everyone is “paid what they’re worth.” Don’t buy it.
According to this mythology, workers at the bottom are “unskilled” and don’t deserve more than what they currently earn.
Minimum wage workers at McDonald’s are paid what they are worth in the so-called “free market.” If they were worth more, they’d earn more.
By the same logic, the CEO of McDonald’s is worth his multi-million dollar compensation package.
The notion that people are paid what they’re “worth” is by now so deeply ingrained in the public consciousness that many who earn very little assume it’s their own fault that they don’t earn more. That they simply lack the skills they need to be paid more.
But there’s no such thing as unskilled workers. Only underpaid workers. Their productivity — that is the value of what they produce — has been growing for decades. The problem is that their wages haven’t kept pace with their productivity.
The “paid what you’re worth” mythology also lures the unsuspecting into thinking nothing can be done to change what people are paid. It’s simply the way the market works.
Meanwhile, according to this same view, CEOs who rake in tens of millions and Wall Street traders who rake in hundreds of millions, are simply being paid what they’re “worth” because that’s what the market has dictated.
Rubbish. The “paid what you’re worth” fairytale ignores power and disregards policies that have made inequality skyrocket. Like the demise of antitrust enforcement, which has given big corporations the power to set prices, make record profits, and reward their CEOs unprecedented compensation. This fairytale ignores the attacks on labor unions that have reduced union membership from over a third of all private-sector workers in the 1950s to just 6 percent today. All of this resulting in a massive shift in power and wealth from workers to owners.
Those at the top justify their staggering wealth, and they’re “worth,” three ways:
The first is trickle-down economics. They claim that their wealth trickles down to everyone else as they invest it and create jobs. Just wait for it… But as we know, wealth at the top has soared for decades and nothing has trickled down.
The second is the “free market.” They talk about market forces beyond their control. But remember, markets are created by rules. These rules don’t exist in nature; they are human creations. The political power of the wealthy has let them change the rules for their own benefit — busting unions, monopolizing industries, and reaping big tax cuts.
The third is the idea that they’re superior human beings. Sure, they may be talented but this doesn’t justify the staggering amount of wealth they are now taking home. Nor does it justify the amount of wealth they will pass down to heirs. The biggest intergenerational transfer of wealth in history will occur over the next 25 years as the richest 1.5% of Americans hand down roughly some $36 trillion dollars to their children and grandchildren. That doesn’t make those heirs superior. It makes them lucky.
The reality is there’s no justification for today’s extraordinary concentration of wealth at the very top. Or for how little people are paid at the bottom.
The “paid what you’re worth” myth has proven to be a cruelly effective way to put the blame on workers for not getting ahead — while giving the rich and powerful cover to rig the game for their own benefit.
It is distorting our politics, rigging our markets, and granting unprecedented power to a handful of people while millions of Americans struggle to get by.
Don’t fall for it.
Missing from most history books is a key moment leading to the culture wars now ripping through American politics.
In 1970, hundreds of construction workers pummeled around 1,000 student demonstrators in New York City — including two of my friends. The “Hard Hat Riot,” as it came to be known, ushered in an era of cynical fear-mongering aimed at dividing the nation.
The student demonstrators were protesting the Vietnam War and the deadly shooting of four student activists at Kent State University that occurred just days before.
The workers who attacked them carried American flags and chanted, “USA, All the way,” and “America, love it or leave it.” They chased the students through the streets — attacking those who looked like hippies with their hard hats and steel-toed boots.
When my friends in the anti-war movement called to tell me about the riot later that day, I was stunned. Student activists and union workers duking it out in the streets over the war? I mean for goodness’ sake, weren’t we on the same side?
According to reports, the police did little to stop the mayhem. Some even egged on the thuggery. When a group of hardhats moved menacingly toward the action, a patrolman apparently shouted: “Give ’em hell, boys. Give ’em one for me!”
The construction workers then marched toward a barely-protected City Hall. Why? Because the mayor’s staff had lowered the American flag in honor of the Kent State dead. In a scene eerily foreshadowing the January 6th Capitol Riots, they pushed their way towards the building.
Fearing the mob would break in, city officials raised the flag.
The hard hats also ripped down the Red Cross banner that was hanging at nearby Trinity Church. They stormed a Pace University building, smashing lobby windows with their tools and beating students and professors.
Around 100 people were wounded that day, many of whom were college students. Several police officers were also hurt. Six people were reportedly arrested, but only one construction worker.
My friends escaped injury but they were traumatized.
The Hard Hat Riot had immediate political consequences. It was, in my opinion, a seminal moment in America’s culture wars.
Then President Richard Nixon exploited the riot for political advantage. His administration had been working on a “blue collar strategy” to shift white working-class voters to the Republican Party.
“Thank God for the hard hats,” Nixon exclaimed when he heard about the riot.
But rather than passing pro-labor policies to court workers, which would go against the values of the pro-business Republican Party, Nixon sought to use cultural issues like patriotism and support for the troops to drive a wedge between factions of the Democratic Party.
Nixon invited union leaders, some of whom were involved in the riot, to the White House. They presented Nixon with a hard hat inscribed with “Commander in Chief”and an American flag pin. Nixon praised the union workers as, “people from Middle America who still have character, and guts, and a bit of patriotism.”
Nixon’s strategy to use the Hard Hat Riot to appeal to blue collar voters paid off. In his 1972 re-election campaign against the anti-war Democrat George McGovern, he secured a victory with ease and gained the majority of votes from organized labor – the only time in modern history a Republican presidential candidate accomplished such a feat.
The Hard Hat Riot revealed a deep fracture in the coalition of workers and progressives that FDR had knitted together in the 1930s, and the later alliance of Black Americans, liberals, and blue-collar whites that led to Lyndon Johnson’s landslide re-election in 1964.
The mostly white construction workers who attacked the demonstrators had felt abandoned — and forgotten – as the Civil Rights movement rightfully took hold. They felt stiffed by the clever college kids with draft deferments, and burdened by an economy no longer guaranteeing upward mobility.
The class and race based tensions that Nixon exploited would worsen over the next half century.
I witnessed this when I was secretary of labor during the Clinton Administration. I spent much of my time in the Midwest and other parts of the country where blue-collar workers felt abandoned in an economy dominated by Wall Street. I saw their anger and resentment. I heard their frustrations.
Many Democrats, whether they will admit it or not, have not done enough to respond as Republicans have destroyed unions, exacerbated economic inequality through trickle-down nonsense, tried to gut just about every social safety net we have – and stood in the way of practically every effort to use the power of government to help working people.
Today, the right is trying to channel that same anger and violence against the Black Lives Matter movement, the LGBTQ+ community, particularly drag queens and transgender people, and whatever they consider “woke.”
It is the same cynical ploy to instill a fear of “the other” as a means to distract from the oppression and looting being done by the oligarchs who dominate so much of our economy and our politics.
As such, today we face the same questions we faced in 1970:
Will we finally recognize that we have more in common with each other than those who seek to divide us for political and economic gain?
Can we unite in solidarity, and build a future in which prosperity is widely shared by all?
I truly believe that we still can.
If there’s one thing that brings our divided nation together, it’s our hatred of junk fees.
Junk fees are extra charges you don’t know you’re paying until you get the bill. They hide the true cost when you buy a good or service, so it’s impossible to comparison shop. For example…
Say I want to travel to go see my favorite musician Dolly Parton play at Nashville’s Grand Ole Opry.
When I book my plane ticket, I have to fork up extra cash to bring luggage or change my flight. My grandkids are more into Blippi than Dolly — so they won’t be traveling with me. Otherwise, I might have to pay a fee just to sit with them.
I need a rental car once I land, so I’ll be stuck paying an extra fee to pick up the car at the airport and another fee they never told me about to cover the rental company’s costs for disposing old tires. Seriously?
When I pay my hotel bill, the price is way higher than I thought I’d pay when I booked the room, to cover wi-fi, pool access, a gym, state and local taxes and other special fees.
Before I get to the show, I better look at my checking account balance if I want to buy a record. Even if I see that I have enough money to make a purchase, the timing of other charges hitting my account could result in me getting slapped with a surprise overdraft fee. It’s a simple mistake, but could make a $20 record end up costing $50.
Oh and don’t forget the concert tickets themselves. Major ticket sellers like Ticketmaster tack on fees to attend shows, which can drive up the final ticket price as much as 78% percent higher than what I was told the initial price was.
It’s all bait-and-switch. You thought you could afford to see Dolly Parton, but it turns out it’s gonna take a lot more than working “9 to 5”.
Corporations often label these types of charges “convenience fees” or “service fees.” Probably because they “conveniently” “serve” to pad their bottom lines, costing Americans at least $29 billion dollars a year we didn’t expect to pay. This is a huge problem spanning many different industries — not just the ones I’d encounter on my trip.
But there’s good news: President Biden has urged Congress to draw up legislation to prevent these outrageous fees.
Turns out, one of the few things as popular as Dolly Parton is tackling junk fees.
It’s time for Congress to act.
There’s a dirty trick many employers use to keep workers from getting a better job.
Some 30 million Americans are trapped by contracts that say if they leave their current job, they can’t work for a rival company or start a new business of their own.
These are called non-compete agreements.
They block workers from seeing higher wages or better working conditions. And they enlarge corporate monopoly power by stifling competition.
But a sweeping new rule from the Federal Trade Commission would put a stop to these non-compete agreements.
The FTC estimates that banning them could increase wages by nearly $300 billion a year overall by allowing workers to pursue better job opportunities.
But non-competes aren’t just bad for workers. They also harm the economy as a whole by depriving growing businesses of the talent and experience they need to build and expand.
Experts argue California’s ban on non-competes was a major reason for Silicon Valley’s boom.
For several decades, non-compete agreements have been cropping up all over the economy — not just in high-paying fields like banking and tech but as standard boilerplate for employment contracts in many lower-wage sectors such as construction, hospitality, and retail.
A recent survey found that non-competes are used for workers in more than a quarter of jobs where the typical employee only has a high school diploma. Another found that they disproportionately impact women and people of color.
Employers say they need noncompete agreements to protect trade secrets and investments they put into growing their businesses, like training workers.
Rubbish. Employers in states that already ban these agreements (such as California) show no sign of being more reluctant to invest in their businesses or train workers.
The real purpose of noncompetes is to make it harder (or impossible) for workers to bargain with rival employers for better pay or working conditions. Workers in states that have banned non-compete agreements have seen larger wage increases and more job mobility than workers in states where they are still legal.
As we learn again and again, the economy needs guardrails — and workers deserve protection. Otherwise, unfettered greed will lead to monopolies that charge high prices and suppress wages.
America once understood the importance of fighting monopolies. Woodrow Wilson created the Federal Trade Commission in 1914 to protect the public against the powerful corporate monopolies that fueled unprecedented inequality and political corruption.
In 1976, when I ran the policy planning staff at the FTC, it began cracking down on corporations under its then assertive chairman, Michael Pertschuk.
Corporate lobbyists and their allies in Congress were so unhappy they tried to choke off the agency’s funding, briefly closing it down. Pertschuk didn’t relent, but eventually he (and I) were replaced by Ronald Reagan’s appointees, who promptly defanged the agency.
Now, under its new Biden-appointed chair, Lina Khan, the FTC is back. Its ban on non-compete agreements nationwide marks the first time since Pertschuk that the agency has flexed its muscle to issue a rule prohibiting an unfair method of competition.
The rule is hardly a sure thing. I wouldn’t be surprised if the radical-right Republicans, now in control of the House, tried to pull off a stunt similar to what the House tried in the late 70s. And corporations are sure to appeal the rule all the way up to the Supreme Court.
In the meantime, kudos to Lina Khan and the FTC for protecting American workers from the unfettered greed of corporate America.
Think your grocery bill is high now? Just wait.
A massive corporate merger could send skyrocketing food prices through the stratosphere, unless the government sees the deal for what it is — a rotten egg.
Supermarket giant Kroger is in the process of finalizing a nearly $25 billion deal to acquire its jumbo-sized competitor Albertsons, combining their 5,000 supermarkets into one mega company.
Corporate concentration in the grocery market is already a huge problem, with estimates showing that just five companies control over 60 percent of American grocery sales
This means less consumer choice, and more opportunity for grocery stores to jack up prices — which they’ve already been doing lately under the cover of inflation. Let’s be clear: Big corporations are using the excuse of inflation to pass price increases through to you.
Now you may think this merger won’t affect you because you don’t have a Kroger or Albertsons where you live, but here’s the kicker: Both stores already control dozens of other grocery brands across the country. So you may not even know you’re actually shopping at Kroger or Albertsons.
All told, this deal could affect grocery stores relied on by 85 million households.
What’s to stop this new goliath from continually raising prices if customers have nowhere else to shop? With grocery bills already going through the roof, Kroger buying Albertsons gets rid of the roof altogether.
A Kroger-owned mega company can also get away with paying workers even less than it already does — because fewer competitors means grocery workers have fewer choices of whom to work for.
According to one survey, 75% of Kroger workers were food insecure and 14% have experienced homelessness. One out of every five Kroger workers has relied on government aid to survive.This is no secret to Kroger execs either. Recently leaked internal documents reveal that the company has known about the plight of its workers for years.
This is the story of monopolization, folks. Corporate consolidation is bad news for everyone except the super-rich. It’s awful for consumers, workers, and the economy as a whole — and it’s driving the most extreme wealth imbalance in over a century.
But the good news is that this Kroger-Albertsons deal is far from being fully baked. The Federal Trade Commission has the power to intervene and stop it. Several labor unions, produce growers, antitrust experts, and state Attorneys General are already urging the FTC to block it.
We can’t afford to let another supermarket giant gobble up an even bigger piece of the American pie.
I keep hearing “no one wants to work anymore.”
The U.S. Chamber of Commerce, corporate America’s biggest lobbying group, claims there are over 10 million job openings right now in the US for which employers can’t find workers.
Federal Reserve chair Jerome Powell says the U.S. is dealing with a “structural labor shortage” that won’t be resolved anytime soon.
But here’s the truth: there is no labor shortage.
There is a shortage of jobs paying sufficient wages to attract workers to fill them.
When a problem is wrongly described, the solutions posed often turn out to be equally wrong.
For most Americans, real inflation-adjusted wages continue to drop. Any pay increases workers may have earned in the past few years have actually been pay cuts, because wages have lagged behind the rising costs of basic necessities — like housing, food, childcare, and healthcare.
You don’t have to be a financial wizard to see why some workers might say the hell with it.
So, what should be done about the difficulty employers are having finding workers?
Simple. If employers want more workers, they should pay them more.
Many corporations are raking it in right now, they can clearly afford to.
Of course Jerome Powell and his colleagues at the Fed don’t want to hear this. They’re aiming to deal with the so-called “labor shortage” by slowing the economy so much that employers can find all the workers they need without raising wages.
But the Fed increasing interest rates to slow the economy will prevent millions of people from getting desperately-needed raises and cause millions more to lose their jobs — disproportionately low-wage workers, women and people of color.
Meanwhile, Republicans and some corporate economists blame the “labor shortage” on overly generous unemployment benefits. They say the way to get more people into jobs is to make their lives outside jobs less tolerable.
Rubbish. Most unemployed people are already hard up.
Pandemic benefits are long over, and even before COVID, America’s unemployment system was already the least generous of any rich nation.
Taken to its logical extreme, the corporate Republican argument holds water only if you don’t give a damn about workers.
Sure…you could eliminate all safety nets and at some point people without jobs will hurt so much they’ll have to take any available job, at any wage, whatever it demands.
But do this, and we’ll end up with an economy that’s even crueler than today’s economy.
Look: If we want more people to take jobs — AND we wish to live in a moral society where people can maintain decent lives — the answer is to pay people more.
Instead of saying “no one wants to work anymore,” we should be saying, “no one wants to be exploited anymore.”
In America, it’s expensive just to be alive.
And with inflation being driven by price gouging corporations, it’s only getting more expensive for regular Americans who don’t have any more money to spend.
Just look at how Big Oil is raking it in while you pay through the nose at the pump.
That’s on top of the average price of a new non-luxury car — which is now over $44,000. Even accounting for inflation, this is way higher than the average cost when I bought my first car — it’s probably in a museum by now.
Even worse, the median price for a house is now over $440,000. Compare that to 1972, when it was under $200,000.
And when you get back after a long day of work, you’ll likely be met with bills up the wazoo for doctor visits, student loans, and utilities.
So what’s left of a paycheck after basic living expenses? Not much.
All of this comes back to how we measure a successful economy.
What good are more jobs if those jobs barely pay enough to live on?
Over one-third of full time jobs don’t pay enough to cover a basic family budget.
And what good are lots of jobs if they cause so much stress and take up so much time that our lives are miserable?
And don’t tell me a good economy is measured by a roaring stock market if the richest 10 percent of Americans own more than 80 percent of it.
And what good is a large Gross Domestic Product if more and more of the total economy is going to the richest one-tenth of one percent?
What good is economic growth if the way we grow depends on fossil fuels that cause a climate crisis?
These standard measures – jobs, the stock market, the GDP – don’t show how our economy is really doing, who is doing well, or the quality of our lives.
People who sit at their kitchen tables at night wondering how they’re going to pay the bills don’t say to themselves
“Well, at least corporate profits are at record levels.”
In fact, corporations have record profits and CEOs are paid so much because they’re squeezing more output from workers but paying lower wages. Over the past 40 years, productivity has grown 3.5x as fast as hourly pay.
At the same time, corporations are driving up the costs of everyday items people need.
Because corporations are monopolizing their markets, they don’t have to worry about competitors. A few giant corporations can easily coordinate price hikes and enjoy bigger profits.
Just four firms control 85% of all beef, 66% of all pork, and 54% of all poultry production.
Firms like Tyson have seen their profit margins skyrocket as they jack up prices higher than their costs — forcing consumers who are already stretched thin to pay even more.
It’s not just meat. Weak antitrust enforcement has allowed companies to become powerful enough to raise their prices across the entire food industry.
It’s the same story with household goods. Giant companies like Procter & Gamble blame their price hikes on increased costs – but their profit margins have soared to 25%. Hello?
They care more about their bottom line than your bottom, that’s for sure.
Meanwhile, parents – and even grandparents like me – are STILL struggling to feed their babies because of a national formula shortage. Why? Largely because the three companies who control the entire formula industry would rather pump money into stock buybacks than quality control at their factories.
Traditionally, our economy’s health is measured by the unemployment rate. Job growth. The stock market. Overall economic growth. But these don’t reflect the everyday, “kitchen table economics” that affect our lives the most.
These measures don’t show the real economy.
Instead of looking just at the number of jobs, we need to look at the income earned from those jobs. And not the average income.
People at the top always bring up the average.
If Jeff Bezos walked into a bar with 140 other people, the average wealth of each person would be over a billion dollars.
No, look at the median income – half above, half below.
And make sure it accounts for inflation – real purchasing power.
Over the last few decades, the real median income has barely budged. This isn’t economic success.
It’s economic failure, with a capital F.
And instead of looking at the stock market or the GDP we need to look at who owns what – where the wealth really is.
Over the last forty years, wealth has concentrated more and more at the very top. Look at this;
This is a problem, folks. Because with wealth comes political power.
Forget trickle-down economics. It’s trickle on.
And instead of looking just at economic growth, we also need to look at what that growth is costing us – subtract the costs of the climate crisis, the costs of bad health, the costs of no paid leave, and all the stresses on our lives that economic growth is demanding.
We need to look at the quality of our lives – all our lives. How many of us are adequately housed and clothed and fed. How many of our kids are getting a good education. How many of us live in safety – or in fear.
You want to measure economic success? Go to the kitchen tables of America.
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