The Executive Minimum Wage
I just got laid off a second time in the last 24 months last week. I would have been laid off many times more if I were able to find a job within the 17 months after my initial lay-off but I wasn’t so lucky. I don’t work for a seasonal company but it’s definitely become one as it has downsized its workforce for the sake of productivity, efficiency and due to lower demand caused by uncertainty in the industry it supplies products for. I was recently hired back for a two month stint for one single reason: to meet promises made to shareholders and maximize the bonuses of the people at the top of the company.
When I got hired back in, I knew my employment was going to last only until the end of September and had no wild hopes for something more than that. I was totally fine with that, knowing the work was seasonal based on the end of the business cycle. I do hope to be rehired once demand goes back up but, if that day comes, it will still be temporary; in the interim, furloughs abound for the lucky few who are still permanent employees.
While I accept the reasons for my temporary employment and feel grateful for the opportunity to work for a few paychecks, I’m still far too much a Democrat to not scoff at the juicy irony when economists deride the minimum wage while executives and corporate directors position their business cycle and employment in order to squeeze out the most out of those grateful little people to ensure their own minimum wage policy.
Roger Cohen for the New York Times wrote in “The New American Normal” on what a retired Wall Street executive told him:
He said the final straw came in 2002. Top executives at the bank where he worked gathered to discuss their bonuses. The issue before them was whether to maintain those bonuses in a time of economic contraction, which would require firing 5 percent of the workforce, or take a 25 percent bonus cut, which would allow those jobs to be kept.
“The guy running the meeting asked for a show of hands on who would accept a reduced bonus,” he said. “There were 30 of us in the room. Three raised their hands. I was one of them.”
The job losses went through, this executive left, and the bank today is still trying to claw out from its uncontrolled excess.
I’m not surprised by this, really; this is the kind of stuff liberals have been deriding for as far back as I remember. I don’t think it’s the “new” Ameican normal but that’s beside the point. This American normal is hypocritical and it’s obnoxious whenever I read about the economic truth concerning minimum wage. Yes, the minimum wage does have nasty effects on employment; generally, increasing wages do lead to lower employment growth and possibly deflation. It’s difficult for me to swallow this and actually give a shit, however, when American executives ensure their own minimum wage policy, drafted and executed by themselves, while the American lower and middle class has been clawing its way through the last three decades of wage stagnation.
Perhaps the minimum wage wouldn’t be such painful to the economy and employment if business executives wouldn’t expect such huge bonuses and concentrate all their energies on their elite minimum wage.