The Business of America Is Out of Control
Last weekend I went shopping for electrical wiring at one of those sprawling home improvement centers. I encountered an employee who was battling to keep his temper in check. He was loading items in a shopping cart and muttering about the world going to pot.
As it turns out, his world is.
Customers are quietly rebelling.
For the last six months or so, shoppers have been making a mess in the section of the store he supervises.
He showed me where paint brushes are misplaced and stuffed in with circuit boxes, where drapery rings are tossed in with wire nuts, where a can of custom-mixed paint is left abandoned, now worthless. Each morning, he loads up a cart with products that customers brazenly scatter out of place.
This has always been a problem in retail. But this employee says he’s never seen it so bad, and it’s getting noticeably worse.
I think I know why. It’s a small sign of bigger grief in the land.
You can see it at the grocery store with avocados and bananas that have been squeezed hard with the intent to ruin them, or in the finger holes that penetrate the plastic packages at meat counters. I read it almost every day in my mail. People say it is their justification for stealing music and movies and software over the Internet.
Consumers are mad, and some are declaring petty war against the mighty corporation, against the shenanigans, the double-dealing, the get-rich-quick schemes, the fraud, the self-serving deals--the corporate wrongdoing that splashes into the daily headlines and mocks American values.
You don’t have to be a retail vandal or an Internet pirate to understand the ground-level frustration of citizens. It creeps into many, if not most, of the conversations I have with friends, sometimes with startling ferocity.
Americans, if I can generalize, are feeling powerless right now. Not just against the threat of terrorism but against the overindulgences of their own free-market system and the stubborn indifference of Washington.
One of the promises of democracy, the essential promise, is that it will react to crisis.
In this case, it isn’t happening. Representative government is inert against the disclosures of corporate corruption, corner-cutting, fraud and unfairness.
It doesn’t seem to matter that the allegations grow more numerous and shocking by the week. Headlines tell us that Congress is gridlocked over “reform” of the accounting profession and pension law.
But look past the rhetoric and you quickly see the arguments amount to little more than whether to use squirt guns or water balloons against a high-rise fire. For instance, Congress cannot agree whether chief executives should have to attest to the honesty of their company audit reports. You mean they don’t already?
Compare that with the far-reaching retirement “reforms” that business engineered in the late 1970s, when corporations decided they didn’t want to offer direct-paid pensions to workers anymore. The 401(k) system was dreamed up as a gradual replacement. Recent studies have shown that business saved 14% to 22% in pension costs in the ensuing years, while the median net worth of American workers, ages 47 to 64, has fallen more than 13%, chiefly as a result of shrinking retirement nest eggs.
Indeed, these changes in pension law explain why today’s business malfeasance has become so gripping, at least outside of Washington. Our investment markets are no longer a game played primarily by those who can afford to lose. At last count, 52% of us have our bread-and-butter retirement hopes tied up in mutual funds.
The decline of stocks has meant not just a loss of billions of dollars in savings for millions of workers, but it also has exposed levels of social corruption and avarice that the U.S. has not seen since the Gilded Age at the end of the 19th century.
For a family that has watched its retirement shrivel by one-third while corporate executives rake in nine figures, it is no satisfaction to hear the Bush administration and timid opposition Democrats argue over how many contacts Enron had with the White House. It is of little consolation to listen to regulators promise that market forces will eventually set things right after taking us so far off track.
Americans know exactly what’s going on.
A Harris Interactive poll conducted in April found that 87% of those who responded believed that big corporations had too much power in Washington. This was not a measure of anti-business sentiment so much as dismay with politics, because an equal 87% said small companies had too little influence over national policy.
Big corporations have used their power shrewdly. They have sweet-talked the Republicans into forgetting about the values of law and order. They have blunted the wage-earner sympathies of the Democrats.
For that privilege, they’ll happily pay clerks to restock the shelves.
