A reader urged me to write about this story that appeared in the New York Times about the Apple corporation. We all know that these are tough times for the economy, and many people are out of work. But Apple is a company that makes great products and is doing exceptionally well.
Apple is one of the most successful and most profitable corporations in the world. It makes beautiful products (I am working on one now). Its stores provide excellent customer service, which is a rarity in these times. I can remember the frustration of spending hours on the phone trying to get someone to help me fix my Dell. How nice to be able to have a face-to-face consultation with someone who knows how to solve your problems.
Apple compensates its top executives handsomely. According to the story, Apple’s top executive has a sweet deal, worth about $570 million over a few years.
But the 30,000 employees who staff the Apple stores, who are so efficient and knowledgeable, make an hourly wage that is better than the minimum wage but less than $12 an hour. Many earn $25,000 a year.
The technology industry creates wealth but it does not share what it earns with its workers.
And, by the way, the jobs that these Apple employees have are the kinds of jobs that American college graduates increasingly will turn to: service jobs, sales jobs, earning something more than the minimum wage, but not the kind of job that will pay down a large college loan.
It’s better to have a college degree than only a high school diploma, but these days not even college graduates can be sure of getting a good job.
What can we learn from Apple? Maybe you draw a different lesson, but I keep learning the same thing over and over again. Those who accumulate great wealth are not paying a fair share to those who generate that wealth. I am not a Marxist. I am not a socialist. I just think it is not fair to see so many people sinking in our economy while a tiny proportion of our population has money beyond measure.
I have nothing against the wealthy. I don’t care that some people have more wordly goods than others. I understand that life’s not fair. I just harbor this feeling that a person ought to be able to get by on $100 million or so and not keep piling up riches while so many others don’t know how they will feed their children tonight. That doesn’t feel like my America. I grew up right after World War 2 and I remember the sense of shared sacrifice. I remember what the American Dream meant. It meant a middle-class society where no one went to bed hungry at night, and everyone had a fair chance to live a good life if they got an education and worked hard and dealt fairly with others.
It sometimes seems that we have forgotten that vision, that it’s been replaced by the idea of everyone for himself and for himself only.
And one other thing: As more and more people go to college, more and more of them are landing in jobs that do not require a college degree and/or do not pay what they expected when they made the decision to go to college. As you hear “reformers” saying that everyone should go to college, note that they say nothing about how all the new college graduates will find worthy jobs. Earning $12 an hour selling stuff isn’t what most people had in mind when they incurred all that debt.
The economy is changing in ways that none of us fully understands but in ways that increase income inequality, enriching the top 1-10% and almost no one else. We need fresh thinking about who we are and what we are becoming.
Diane
Diane Ravitch's blog 
“I am not a Marxist. I am not a socialist.” No you’re not. What you are suggesting is what “progressives” (not liberals-two totally different perspectives) have been pushing for for at least a century. Unfortunately, with the almost total media control (90%) in the hands of only six corporations which by definition are conservative if not regressive, the message that is “out there” is that progressive political thought, proposals, etc. . . are socialistic, communistic, marxist.
The fact is from the end of WW2 through the 70s, when we had the most progressive policies this country has known in place, more people had more opportunities to share in the “common wealth” than ever. Since the 80’s and the onslaught of regressive conservative policies that “common wealth” has increasingly funneled upwards away from the vast majority of “average Joes” and will never “trickle down”. We will have to squeeze that “common wealth” out of the Gates, Jobs, hedge funder, banksters, etc. . . with progressive American values and policies.
Sadly even teaching is becoming a profession where a degree will be unnecessary as teachers become computer lab facilitators in massive labs. The first strike against degrees in education has come in the form of “compensation reform”. The reformers claim advanced degrees do not translate to higher student achievement, therefore schools should not pay additional salary for them.
There is no respect for education to be found in those who control most of our large school systems.
Don’t you hate it when these politicians, who are highly likely to have J.D. after their name, tell us that graduate degrees don’t matter?
Duncan ignores DoE’s own research showing the master’s effect:
http://www.edweek.org/tsb/articles/2012/02/29/02effect.h05.html
Here’s another study showing the postive impact of masters’ degrees on student achievement:
http://www.bizjournals.com/prnewswire/press_releases/2012/02/09/CL50694
Degrees and teaching certificates are not necessary in Louisiana schools accepting vouchers, a new guideline approved by the LDOE.
Diane,
Towards the end of this blog you write, “It sometimes seems that we have forgotten thatI vision, that it’s been replaced by the idea of everyone for himself and for himself only.”
That sentence struck me and made me think about bionic bracelets, google glasses, customized settings on our facebook pages, avatars, etc…..we will customize ourselves out of existence, I fear. I paired that thought the idea that corporate reforms chant often, ‘everyone goes to college’—–> does that mean everyone will have college debt? Will that ensure dependency to the finance market? Is this why Harvard educated adults chant this? I hope not.
Amen!
The problem isn’t that Apple doesn’t sufficiently share that wealth with their lowest level employees. It’s that at this time, there are simply too many acceptable eager employees available and Apple is taking advantage for the sake of their stock holders. The reality is that Apple could get more than sufficient employees for $11 an hour or even minimum wage so from their perspective, paying $12 or more is seriously generous. The average Apple store sales person is not extraordinarily qualified, sorry. Even their Apple genius employees aren’t all that knowledgeable. They’re simply more knowledgeable that the typical customers and thus appear all knowing. And as compared to those working for Dell, HP and the like, they are more knowledgeable and probably making more money since the low level employees of those other companies in customer support, typically in India, make even less.
What we have is a global conspiracy to move as wealth as possible into the hands of a very few and the very few and the media have conspired to convince the masses this garbage is good for them. The general population needs to open their eyes, stop listening to the current propagandists about how common sense policies are Communist and Socialist when in fact they’re anything but, and throw all the bums out of office and replace them with people who care about 100% of the population, not 1%. Then you address the Apple store salary situation. Every company world wide is acting like Apple. They’re simply getting the exposure.
What you said about maybe $100,000,000 being enough for a single person is right on. There’s no reason to cap a person’s wealth or income but there’s also no reason to keep a tax rate in place the same at that level as it is on say $100,000. Maybe it doesn’t need to go back to 90% but damn, how about 50% in combination with an end to loopholes. The top 1% would still be the top 1% and still be rich and still afford whatever comes to mind. But the other 99% might actually have a living wage and healthcare, etc. How about one tax break for corporations tied strictly to the number of employees and their average salary. Hire more and pay them more and get a tax break. Fire people and pay less and you get no tax break. Rocket science.
What’s your objection to Marxism and socialism? You’re a historian so I assume you know a great deal more about them than I do. Didn’t Marx describe a lot of what’s going on now in Capital?
I’m not any kind of “ist”
Diane
What about a humanist?
I agree with you in stating “I’m not any kind of ‘ist'”. I like the term “free thinker” to describe myself and let others determine what that means.
Marx certainly did clarify much of what’s going on. I don’t think you have to be a strict Marxist to recognize how prescient his ideas were –
http://www.bookslut.com/nonfiction/2011_11_018338.php
I read the original New York Times article article and for some reason I kept thinking of my local boutique coffee shop baristas who seem to have a tenure of a few weeks. What is it about corporations that manage to brand their work as “cool” and convince their workers that they are technocratic missionaries for whom financial compensation would be degrading?
Somewhere along the way, Apple corporate leaders forgot that an significant part of their their wealth is derived from someone else’s labor; that their lucrative salaries and profits depend on the workers who built, distributed, marketed, and repaired their products. Granted, investments in research and development and the capital investment in the machinery of production play a role in profit, but Apple’s store workers are not just lucky interns fetching coffee for the higher-ups: the are the indispensable and principle source of profit for the company in that sector.
The public has become so enamored with technology that they tend to think invention is the primary source of wealth–and that only inventors deserve to be compensated. The fact is that new ideas and inventions are inevitable; knowledge is collective and virtually every technological advancement or scientific theory has multiple paths and multiple explorers–the one who gets there first wins the brass ring, but they got there on the shoulder’s of others. Charles Darwin, for all his genius, found himself in a race to publish his ideas before his rivals achieved immortality.
If technological advancement is generally inevitable and the new technologies have no occupational ladder between the labor at the bottom and the management at the top, why shouldn’t the reward system for workers start with a living wages and time away from work? I don’t think it is a question of sharing wealth; it is a question of returning wealth to it’s rightful owner. That goes for all the productive contributors to Apple wealth; from the assembly line worker to the store technician.
Having worked for years as a factory worker where there was no way to go but sideways, generous wages, great healthcare and retirement benefits, and ample holiday and vacation time made this work not just tolerable, but something that people were willing to commit their lives to. Apple has no obligation to invent middle-level management and a career ladder if it is not needed by the industry. They do have a moral obligation to enhance the lives of the people who–if they all quit for one month–would bring the corporation to bankruptcy.
redistribution of wealth is by no means a controversial or revolutionary idea. It is as a matter of fact as American as apple pie. For almost a generation the top earners – the criminal class – and crony politicians have been extracting wealth from most of the population – mainly from the poor. All the growth in American economy – the economy doubled since the early seventies – and the increase in productivity – around 50 % increase since the late seventies – has gone to top earners. Tax cuts, lower corporate tax, and other fraudulent methods – sub-prime mortgage and other bubbles – plus stagnating incomes have a ‘trickle up’ redistribution of wealth affect. It was and still is a very conscious class warfare waged on the poor and the middle class.
What also interesting is that Dr Ravitch once again found it important to underline the fact that though she recognizes wealth disparities, she says :”I am not a Marxist. I am not a socialist.” Those are dirty words of course and no one want to be associated with the Devil himself. But it shows us the extent of the pro business, pro crony capitalism propaganda we have been brain washed with.
It is valid if Dr Ravitch – or anyone – doesn’t want to be labeled with one ideology or another, yet it is indeed an American phenomenon to reject names but endorse the ideas that the name represents. In other words many Americans might believe in a set of ideas that are socialist but would perceived being a socialist or even admit of endorsing any socialistic ideas as unimaginable and preverse.
In order to ‘manufacture consent’ crony capitalism uses Orwellian methods to generate hate or love to an idea. According to one survey most of Americans (58%) see ‘Socialism’ in a negative light:
http://www.gallup.com/poll/125645/socialism-viewed-positively-americans.aspx
At the same time when you asked Americans about their ideas of social justice, you would find a great majority endorse socialistic ideas of redistribution of wealth and social justice, as a recent research found:
Click to access norton%20ariely%20in%20press.pdf
If you look at the Gallup pole you might also find out that Americans dislike ‘Capitalism’ almost as much as ‘Socialism’ but great majority support ‘Free Enterprise’ .
That is why Frank I. Luntz a brilliant and cynical Republican pollster suggested not to use ‘Capitalism’ but ‘Free enterprise’ when referring to our current system. I recommend reading the Luntz intake:
http://news.yahoo.com/blogs/ticket/republicans-being-taught-talk-occupy-wall-street-133707949.html
Professor Noam Chomsky pointed out that after Reagan started the war against poor people, crony capitalism’s brain washing machine managed convince people that ‘welfare’ is bad, most of Americans, Chomsky noted, are against ‘welfare’. He suggested that the image of ‘welfare queens’ driving their limousines to pick up food stumps, as describe by Reagan cruel anti-poor propaganda, became embedded into people’s mind.
Yet majority of Americans support even greater help from government agencies to the poor – which is welfare by definitions.
On a side note we should acknowledge that we have a socialist system in the US, and a very successful one, as pointed out by the Economist Joseph Stieglitz in his piece ‘America’s socialism for the rich’ where he claims:”The US has a huge corporate safety net, allowing the banks to gamble with impunity, but offers little to struggling individuals”
http://www.guardian.co.uk/commentisfree/2009/jun/12/america-corporate-banking-welfare
I guess a more mature approach would be to say: I am not a socialist but socialism has some good ideas we should embrace. The few socialists I knew were very nice people.
I am reading a book right now (sent to me as a free review copy) by Enrico Moretti called “The New Geography of Jobs.” I am in a chapter where he shows a graph with a linear relationship between the salary of high school graduates and the percentage of college graduates in the population of different metro areas. Basically, that college degrees raise the standard of living not just for the person holding the degree, but for their neighbors as well, and especially their neighbors working lower-skilled jobs.
It’s a very interesting read with the basic premise that the low-six figure jobs that are common for innovation jobs have a huge multiplier through the economy, because those people have discretionary funds and spend most of their money.
I haven’t finished it yet, but it is thought-provoking, and has surprised me. For example, I didn’t realize that Microsoft had started in Albuquerque. He traces out just how much Seattle gained and changed (and Albuquerque lost) because Gates and Allen wanted to go back to Seattle where they had grown up.
Wealthy Americans don’t care about the working poor because they are adults, so the last thing Jobs, Gates and other billionaires have thought about is providing equitable wages to their rank and file. Remember, these folks are still oursourcing to Chinese slaves at Foxconn. It doesn’t matter to them that poor children come from poor parents. It looks better to be helping kids. So they throw money at education –even when that brand of education was created by non-educators and is unproven. And, of course, there are financial gains for employers who invest in that sort of education, requiring a curriculum that promotes conformity and convergent thinking, since that’s most likely to result in compliant worker-bees (even though they claim to prepare students for college).
I read something around Easter this year about billionaires investing in poor children as a method of making points to get into heaven. Can they really be so ignorant as to believe that “omnipotence” would not include the ability to discern venture philanthropy from charity?
As bad as Apple’s wages are, I earned even less for each of the past 4 years, though I put in full time hours (and have no benefits). I have a second job now, but I believe my salary will be just as low this year, due to limitations placed on faculty at that school. I just started teaching there last month and I was told yesterday that I’m already near to meeting the maximum number of students that we are permitted to teach each year. I’ve never taught at a school with a student load limit before, and I have less than 30 students in my courses, so I didn’t see this coming. Time to get a third job. So much for my education, all of my degrees and decades of experience.