Closing the income inequality gap

Contributing writerDecember 23, 2013 

They worked 12 hours a day, six days a week. Conditions were brutal, with a death rate twice the national average. They lived in the company town, often in tents, and could only buy from the company store.

They were paid in scrip (company credits) rather than the U.S. dollars they earned. They went on strike. Colorado Fuel & Iron, a J.D. Rockefeller company, hired guards and a detective agency to break the strike. The state militia was called in.

An armored car with a machine gun was set loose on the strikers. Snipers killed women and children. This massacre of union miners and families devolved into 10 days of terror known as the Colorado Coalfield War. Federal troops had to disarm both sides to stop it.

Up to 200 people died, and many more were maimed. The Ludlow Massacre of April 20, 1914, clearly illustrated the disconnect between management and workers.

The strike failed in its immediate goals, but laid the foundation for the passage of many laws to improve working conditions. Rockefeller became the richest man in the world from the labors of people like these miners.

He is now a respected philanthropist because he gave over $500 million to various causes. Those miners could probably have used some of that money.

Labor conditions are much better today, but the business model is the same. CEOs make millions on the backs of minimum-wage workers. I’ve heard all the arguments: “They’re self-made!” “They are leaders!” No matter how visionary they are, they can’t do it all. That’s why they hire workers.

You’d think they would treat the workers better and pay them more. What better way to invest in your business than to acknowledge and appreciate your most valuable assets? McDonald’s and Walmart show their appreciation by encouraging their employees to get food stamps. Papa John’s Pizza cuts hours to avoid health care mandates.

Recently, Switzerland voted on an initiative to limit executive salaries to 12 times that of the lowest paid worker. It lost. That’s probably a good thing. That kind of restriction would stifle productivity. It also does not address the root problem.

Workers should share in the profitability of the company. Stock shareholders are paid a dividend on their investment. Why do companies not pay a similar amount to their workers? The workers invest their time to make the dividend possible.

Executive bonuses are possible due to worker output. Shouldn’t executive bonuses be matched and distributed to the lower-paid workers?

Laws forcing corporations to share profits might keep more people off food stamps. We’ll always have the one percent. Can we craft workable laws so the rest of us don’t fall so far behind?

I can hear the screams now. Communism! Socialism! Remember, I’m a capitalist: I own my own business.

Our society offers unemployment insurance, Social Security, various forms of welfare, and myriad other social programs. We all use some social (socialist) program when it is to our benefit. Where do we draw the line?

 •   •   • 

On a personal note, I would like to say “thank you.” Writing this column has been a lot of fun. Many readers have made contact with me. Exchanging ideas with you has been eye opening and educational. It’s great to know that so many people still read the paper.

A special thanks to publisher George Le Masurier for the opportunity to write this column. I learned a lot from him in the back and forth between editor and writer. He was very patient.

I encourage everyone to apply for a position on this board of contributors. You’ll experience rewarding personal growth on many levels. Responses have run the gamut from “You are so full of it” to “Wow, that’s pretty good. I never looked at it like that.”

It has truly been a rewarding experience.

Merry Christmas and Happy New Year to all!

Vince Palazzo is a Lacey small-business owner and a member of The Olympian’s 2013 Board of Contributors. He may be reached at palazzovince@gmail.com.

The Olympian is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service