Ooopsie.Looks like Uncle Karl had it right
by digby
Despite near-record levels of economic inequality, many politicians and pundits still don’t think this widening chasm is much of a problem in a country supposedly dedicated to egalitarian ideals.
Inequality, the logic goes, is a natural result of different degrees of work and creativity. Some people strive harder and have better ideas, as well as take more risks, and giving them outsized rewards is a good thing, since it encourages others to emulate this behavior and makes us all wealthier in the end.
Related to this, low-wage jobs aren’t anything to worry about either, since people who put in the effort can climb upward to better jobs and, also, low wages allow business owners to hire more people and generate more growth so that, again, we all win.
The only problem with this story, of course, is that it’s persistently contradicted by the actual facts about inequality today. In truth, inequality in America tracks more closely with a classic Marxist analysis whereby the owners of capital exploit a surplus of labor to keep wages low and generate high profits for themselves — depriving workers of a fair share of the value they are creating for companies. Yes, there are smart entreprenuers taking big risks in America, but the more dominant face of the economy is well-established corporations run by professional managers who keep finding new ways to drive labor costs down and profits up.
Consider a new study out today by the National Employment Law Project (NELP), which shows that most low-wage workers aren’t employed at struggling start-ups or local businesses trying to expand. Instead, says NELP, the majority of such workers are employed by large corporations. And the reason these workers make chump change is not because such corporations are battling to maintain their razor thin profit margins in tough times. Rather, these companies are making plenty of money — more in many cases then before the recession. According to NELP, of the top 50 low-wage employers in America: 92 percent were profitable last year; 63 percent are earning higher profits now than before the recession; and 73 percent have higher cash holdings now than before the recession.
Just a little FYI.
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