I have just returned from Virginia where I received a wonderful reeducation on the beginnings of this country. Several collective human characteristics from our history were pivotal to our early success, and our continued success as a country. Our distrust of King George, or despotic leadership in general, our partnership with the French, and our tenacity played a central role in overcoming hardships both in the army and the families left behind to emerge as the United States of America. However, there was one dark mark on our past that I hope we never forget; that is slavery.
What got me reflecting on this during my morning coffee was an article I read about Starbucks. The company is starting a tuition support program for its employees. Starbucks recognizes the higher costs of education, and the fact that many of its employees are college students, so they felt it was important, for employee retention, to support their employees with this new program. I for one see the social and economic benefit of a program like this. When I worked for Boeing, I took advantage of its tuition program and went to school for 16 years; all on Boeing’s dime. They got the benefit of my education too, but I am now a college professor because of the company’s willingness to support its employees.
Starbuck’s new program can be placed in juxtaposition with other companies that are not willing to care for their employees, if fact many of these companies exploit their employees to ensure a higher level of profit. This to me is very similar to the exploitation of slavery, and something Marx warned us about. Marx felt that the owners of capital helped to create a large army of unemployed to allow the exploitation of the proletariat to ensure low wages and higher surplus profit that lined the pockets of the capitalist.
When Ford decided to pay his employees a living wage in the early 1900’s, his plan “invoked a variety of responses. Workers viewed him as a friend, while many businessmen viewed Ford’s idea as reckless. The Wall Street Journal called it blatant immorality-a misapplication of Biblical principle in a field where they do not belong. Ford disregarded his criticisms because he knew the importance of acknowledging the human element in mass production. He believed that retaining more employees would both lower costs and lead to greater productivity. His beliefs proved his critics false, as the company’s profits doubled from $30 million to $60 million between 1914 and 1916. The payment of five dollars a day for an eight-hour day was one of the finest cost-cutting moves we ever made, Ford said.” It appears Starbucks has the same philosophy.
I know comparing current employee conditions with slavery is not new, and it is a stretch, but the reasons for slavery in the 17th, 18th, and 19th centuries are the same as paying substandard wages to employees today. The word efficiency was used then as now, as business attempts to ensure the proper use of capital and maximum returns to the owners of said capital. However, just as our early fathers struggled with this “peculiar institution,” so do modern business leaders when is comes to balancing pay and benefits with productivity.
“It was Benjamin Franklin who initiated efforts to measure the relative efficiency of slave and free labor.” The early research that arose out of Franklin’s and others desire to measure the level of productivity associated with slavery demonstrated the difficulty of making just a quantitative argument for or against slavery. The question of technical efficiency or allocative efficiency is important? The so-called masters were proven to be very efficient when moving their workers from field to field as necessary to meet harvesting needs, which involves allocative efficiency, but technically the ratio of output to the level of input may not have been as high as a free labor setting. Technically when you have women, children, old, and sick people that have been pressed into forced labor, the production system will not be efficient. In response to this the owners would us a process called gang labor.
In the book, Without Consent or Contract, William Fogel goes into great detail describing gang labor. He described this as an efficient system based on an assembly line dealing with specialized crops. “The un-remitting, machine-like quality of gang laborers repelled 19th century observers who valued traditional agrarian ways.” But the owners were looking for efficiencies in order to maximize their return on investment.
What is my point? I am applauding Starbucks for its choice to support its employees. In an age where our society has lost all sense of loyalty, and employment longevity, it is wonderful to see something that improves company/employee relationships. All this does is create greater social capital as well as a more engaged employee. It reinforces the morality of paying a fair wage to an employee. Oh by the way, there was a woman in Virginia named Elizabeth Bet Van Lew, who owned slaves, but was a spy for the North during the Civil War. She also spent her fortune to purchase and free slaves, sending them north to get educated. This is called manumission, or the act of a slave owner freeing his or her slaves. Starbucks is helping its employees gain an education, which will make it a better company, and society a better place.
In the days of slavery people were bought and sold as a commodity. The owners viewed these people as nothing more than capital, not people. We as a country recognized the horror associated with this type of thinking, and many thousands of our young died to destroy this system. We recognized that people are not commodities to be bought and sold. Today it is refreshing to see companies that do not see their employees as commodities but as people with needs, and if these people are supported they will be loyal employees and customers. This is nothing new, Ford figured it out in 1913, I hope others remember too.
And that is my thought for the day!