Vol. V, Bulletin No. 2. January 24, 2000
Diagnosing a Much-Changed Economy, Domestic and Global
Watch Out! The Squeeze Is On
It's a new computer software called Cash. It produces cash for radio stations by enabling them to squeeze words together and thereby wedge in more time for commercials--up to six minutes more per hour in a talk show.
The compression technology, a tool for shortening pauses between words and removing "redundant" sounds within words, is being used by about 50 radio stations throughout the country, the New York Times reported January 6 in a page one story titled "Radio Squeezes Empty Air Space for Profit.""It's a syndrome of our times," Michael Harrison, editor in chief of Talkers, a weekly magazine, told the Times reporter. "We're at a time when we're so caught up in speed and greed that we have no qualms about bastardizing artistic integrity."Thanks to deregulation, as the Times pointed out, radio stations "can run as many commercials as listeners will tolerate." Ironically, it was the listeners of the nationally syndicated talk show of conservative Rush Limbaugh, no friend of government regulation, who found intolerable the extra commercials jammed into his three-hour program. Only after thousands of email complaints did Limbaugh, who gets his cut of advertising revenue raised during his program, recognize the commercial overload. His complaint about it, voiced on his own program, led the Times to investigate the Cash-induced trend.
* * *'Pushing and Pushing...on Production Numbers'
At least 21 people died and at least 100 others became seriously sick from eating Sara Lee hot dogs and deli meats during the fall and winter of 1998-99. It was the U.S.'s worst food epidemic in 15 years, a tragedy caused by a deadly bacteria, Listeria monocytopenes, found at Sara Lee's giant Michigan meat processing plant, Bill Mar Foods, and in some of its products.
Underreported by the media, the nation-wide epidemic was investigated for months by a Washington Post Magazine staff writer, Peter Perl, and described in a January 16 feature article titled "Poisoned Package." In interviews with him, a dozen former workers, managers, and U.S. Department of Agriculture inspectors "described the Bil Mar plant as a high-stress, high-turnover environment in which working conditions were difficult and the push for increased production was relentless," Perl wrote.
Joseph Keller, a plant supervisor who quit in 1998 after 14 years, "burned out from working 60 hours and seven days a week," told Perl that the plant's atmosphere changed dramatically after 1987, when the DeWitt family, who founded the company in 1938, sold it to the Sara Lee Corporation. In DeWitt's words, as quoted by Perl:"It was a good company, but the switch from the DeWitts to Sara Lee, it lost the family feeling. It became 'How much money can you make for me?'...Nothing was ever good enough. Upper management just kept pushing and pushing, and you were only as good as your last production numbers."Under family ownership, for example, the plant ran five or six days a week, with two eight-hour production shifts, plus a third shift devoted solely to sanitation. Under Sara Lee, the plant moved to a seven-day schedule, and lengthened shifts to 10 hours, at the expense of cleaning time, according to Keller. "There was real head-butting between [production] speed and cleanliness."
At least 10 multimillion-dollar lawsuits are pending against Sara Lee. Senator Tom Harkin of Iowa plans to reintroduce a bill that got nowhere in 1998 and 1999, his Safer Meat and Poultry Act, which would strengthen the enforcement powers of the U.S. Department of Agriculture. The Department's present weakness, he says, "borders on the ridiculous."
(For an explanation of why and how U.S. law on food safety needs strengthening, check the Website of the Center for Science in the Public Interest.)
This Challenge Awaits a Modern Adam Smith
* * *
Do the above two news reports depict events that are isolated--exceptional in news interest, but lacking in broader significance? Or, as examples of heightened pressures for more and more profits, are they symptoms of what's wrong with our economy, domestic and global?
A Bangladeshi union leader once gave me his description of a sweatshop. "The squeeze is on the workers to do more and more, to sweat as much production as possible out of them," he said. In talking with owners of local factories, I learned that they felt the squeeze for more production too--from the buyers of corporations who contracted for Bangladesh-made garments and shoes. The reach of this squeeze is global.
Our market-driven economic system, domestic and global, has changed rapidly and radically in the past decade in ways that are basically still little understood. When will a modern Adam Smith come forward to analyze it factually and describe it fully? From some evidence now emerging, the title of such a tome could well be The Squeeze Economy.
U.S. Pulling Apart in Income and Wealth
The vigorous U.S. economic growth during recent years hides income disparities between the rich and poor that, in most of the country, are significantly wider in the late 1990s than they were during the 1980s. That's the overall finding of a new study, "Pulling Apart: A State-by-State Analysis of Income Trends," issued jointly on January 18 by two Washington-based think tanks, the Economic Policy Institute and the Center on Budget and Policy Priorities."The report shows that with few exceptions economic growth in the 50 states has not been broadly shared," said Jared Bernstein of the Economic Policy Institute, co-author of the study. "The strong economic growth in the U.S. results from the contributions of people in all walks of life, from laborers to corporate executives. [But] many families are not sharing in the resulting prosperity."One key finding: In 11 large states, the incomes of the top 5% of families increased greatly--ranging from a 35% increase in Texas to 75% in Pennsylvania--between the late 1970s and the late 1990s. But the incomes of the bottom 20% of families either declined or grew very little in 10 of those 11 states. In New York state, for example, the highest income 5% of families gained nearly $108,000 per family, whereas the lowest-income 20% lost $2,900 per family.
(The text of the lengthy report, as well as a summary, can be found on the Websites of the two organizations, at http://www.epinet.org and http://www.cbpp.org.)
'The Very Wealthiest Have Done Extraordinarily Well'--Business Weekly
Meanwhile, another report issued in January, this one by the Federal Reserve Board, shows how disparities in income get reflected in wealth. In tracking U.S. family incomes and wealth between 1995 and 1998, the report found:
Business Week's analytical comment: "the very wealthiest have done extraordinarily well" in the surging economy, but "it has left the poor behind."
- families with earnings of $100,000 and up increased their average (mean) net worth to more than $1.7 million, or 22%.
- families in the two bottom income brackets suffered a drop in wealth, 7% in the case of those with incomes under $10,000.
(The report is contained in the January issue of the Federal Reserve Bulletin.)
Gap between Words and Deeds at Gap
Rebuffed in their attempt to present a petition to the head of one of the world's largest and most profitable clothing retailers, Gap Inc., 14 worker rights advocates staged a protest in the lobby of Gap's San Francisco headquarters January 13. The date marked the one-year anniversary of a lawsuit charging Gap and 17 other retailers with human rights abuses in sweatshops located on the U.S. territory of Saipan in the Pacific. The protesters were arrested, cited, and promptly released.
Their petition, signed by about 10,000 people nation-wide, asked Gap to ensure that its workers are paid a living wage and have the right to organize and that the company allow external monitors to inspect its factories. Gap has "an exemplary code of conduct, but we know it's not being enforced," said Leila Salazar of Global Exchange, a San Francisco-based human rights organization, which organized the January 13 protest.
Although some companies involved in the Saipan anti-sweatshop lawsuit have settled, Gap, an industry leader which also owns Banana Republic and Old Navy, has not. Along with kindred groups, Global Exchange has promoted a series of "days of action" nation-wide to put the spotlight on Gap. The next one is Saturday, February 5.Global Exchange is not trying to close Gap's overseas factories, located in 50 countries. "We don't want to call a boycott of Gap," Salazar said. "The workers want to keep their jobs. They just don't agree with the ways they're being treated. We need to put pressure on Gap to change that."The protests "have no effect on sales," Gap spokeswoman Maria Moyer-Angus told the San Francisco Examiner. "Sales are going up."
(For background on the Gap campaign, consult the Website of Global Exchange at
Diary: Martin Luther King and My Parish
It was a surprise, at least for me. The weekly bulletin distributed at my parish on the Sunday before the Martin Luther King Jr. holiday carried a large picture of the renowned Baptist minister and civil rights leader, along with a quotation from him:"With this faith [in God] we can transform bleak and desolate valleys into sunlit paths of joy and bring new light into the dark caverns of pessimism."From my seat at the 10:30 Mass, I could see a dozen or more blacks in the congregation, plus almost the same number of men and women of Asian origin. The celebrant, Father John Langan, S.J., of Georgetown, wove a tribute to Dr. King into his homily.
Some hard questions arose during my prayerful meditation that morning. How, I wondered, did the Catholic parishes of Atlanta treat Dr. King during his lifetime? Does the respect shown him nowadays really signify a decline in racial prejudice? What would we be saying about him today if he were still alive and still an agitator seeking justice for the millions trapped in poverty?
Human Rights for Workers: Bulletin No. V-2, January 24, 2000
Robert A. Senser, editor
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