The disparity in wealth has been in the news since the stock market crash in 2008. I’m sure we all remember “Occupy Wall Street” and the “One Percenters.” Obviously, in a meritocracy like America, this is not a new problem… let’s jump back a couple hundred years.
In the early nineteenth century, we had Robber Barons (industrialists) like John J Astor and John D Rockefeller (America’s first billionaire) who were accused of using exploitative practices t amass wealth at the expense of their workers while creating monopolies and “buying” government support with money acquired through selling inflated stock. Hence the name – Robber (Criminal) Baron (illegitimate aristocrat).
When the “tech bubble” was created, we got “silicon sultans”2 like Bill Gates & Mark Zuckerberg (both college drop outs). Though they are both incredibly philanthropic with their vast wealth, neither of them graduated from college and using their niche genius, they were able to amass vast fortunes in a rather short period of time. Bill Gates was 23 when he became a millionaire, 31 when he reached billionaire status. Mark Z was 23 when he became a billionaire. That’s great… for them and whomever their charities support. Gates and Zuckerberg’s financial realities aren’t even conceivable for most Americans who struggle paycheck to paycheck with thousands of dollars in student loan debt because we believed the old myth that you “must have a college degree” to do anything of worth.4
Now let’s take the income and wealth disparity to the local level, leaving the One Percenters behind…
I we don’t have a specialized genius, instead of amassing a fortune with our creativity or ingenuity, we get to amass crippling debt to go to college so they can fill our heads with information that doesn’t exactly have practical use in the real world, outside of some sciences. (Chemical reactions are important to chemists.) I’ve seen arguments about what you really learn in college – networking, writing/communication, critical thinking, etc.3 but none of these require a post-secondary education to learn. Most of the things you learn in college can be “self-taught.” However, you still have to have that little piece of super expensive paper saying that you spent four+ years “enrolled” in bettering yourself (aka partying) for most people to take you seriously.
So then you finish university, have (hundreds of) thousands of dollars in debt, and get a job at a great company. Your salary isn’t great, but it’s a “livable wage,” and the company is a Fortune 500 so there are endless growth opportunities! You couldn’t be happier! This is the life!!
Fast forward 7 years… after three layoffs, though you’ve worked really hard, been active in extracurricular activities, held leadership positions, willingly worked overtime, etc. you’ve received only three pay raises. The first, when after almost 3 years as a temp with ridiculously expensive benefits, little time off, and a meager salary, you FINALLY get the offer to become an “actual employee,” which was originally supposed to happen after one year. Two years after that, you get a small promotion, with another meager raise to justify you coming back to a project you had left previously to avoid getting laid off because they really need someone with your experience.
Two years later, you are excited about the chance for another promotion… and then the “email” comes stating that there will be no “non-executive” pay increases, cost of living (COL) increases, equity adjustments, or promotions for the next year, except in the case of the highest performers (which are always visible at their high level) because the company needs to stay competitive. The President of my business line has said that they don’t think it’s right for some to get raises and not all, so there will be no promotions in my line, except for the top two levels, because like every other corporation, we only promote based on merit… (more on this in the next paragraph). However, if you would like to be eligible for any promotion in the future, please spend your personal money (hundreds of dollars) to get certifications through national professional organizations so if we decide to reinstate salary increases next year, you may be eligible for one.
The key in the above “review” is that the pay increase block was only for “non-executives” because the “executives” will still be getting their multi-million dollar bonuses. Under the logic for the limited promotions and pay raises, in order to receive one, you must be a top earner. Since our CEO has been in office, the corporate stock price has dropped 40%. Last year, he was ranked as one of the top 25 Worst CEOs in the United States. Yet, I would bet my job that he will still be getting his Four Million Dollar bonus this year. To refresh, my $1200 cost of living increase would put us out of competitive range, but his $4M bonus, which is entirely Over Head (OH) and not billable to a project like I am, doesn’t affect our competitive range.
Yes, I’m being extreme because there are roughly 35,000 employees in my company throughout the world. However, there are at least 5,000 executives who get at least $2M in bonuses through the year. This is $10M dollars a year in, predominantly, OH. Let’s say half of the remaining 30K employees are in the US. If we gave a $1000 across board COL increase, that would be $15M, which would be predominantly chargeable to a project (and profit earning).
I just don’t understand the logic…. If you are going to withhold opportunities for advancement or pay increases, do it across the board – no exceptions, using that “team” mentality corporations shove down our throat but ignore when it doesn’t suit their needs. Enough swigging the Kool-Aid!
Obviously, you are intelligent enough to see this charade for what it is, and your dream is (as it always was) to work for yourself, but with the student loan debt and meager salary, you can’t afford to save enough money to allow you the “window” to get set up independently.
Rock, meet hard place…. But this kind of struggle is what great American dreams are built from! So here we are – blogging to every other person with a dream and confusion about how to achieve it, but determination that you will!
2 – http://www.economist.com/news/briefing/21637338-todays-tech-billionaires-have-lot-common-previous-generation-capitalist This is a great article! It isn’t exactly along the lines of this post, but I would recommend a full perusal!