On February 21, 2020, Sam Pizzigati writes on Inequality.org:
Talking about it. Michael Bloomberg just the latest deep pocket to laud how much he personally labors.
Billionaire White House hopeful Michael Bloomberg must have known the question was coming. At the February 19 Democratic presidential debate in Las Vegas, the question did come — from NBC’s Chuck Todd. Should billionaires, Todd wanted to know, exist?
“Have you earned too much — has it been an obscene amount of — should you have earned that much money?” Todd followed up.
“Yes,” Bloomberg replied. “I worked very hard for it.”
“Hard work” has been the go-to justification for grand private fortune ever since the days of America’s original Gilded Age. In America, the old saw goes, anybody can get rich. You just need to put your shoulder to the wheel, your nose to the grindstone.
That true? Social scientists have tested out this “hard work” case for grand fortune. Success in the business world, they’ve found, most typically comes to those with access to financial capital, via “family money, an inheritance, or a pedigree and connections.” Many researchers, economist Andrew Oswald has noted, “have replicated the finding that entrepreneurship is more about cash than dash.”
None of this research, naturally, has stopped the awesomely affluent from claiming that they deserve their prodigious wealth because they — like Michael Bloomberg — have “worked very hard.”
Back in the 1990s, the decade Bloomberg first crashed into the national consciousness, no man of means made the “hard work” claim more unabashedly that John K. Castle, a New York banker who had built up a tidy personal fortune worth about $100 million.
“None of this happens without working 60 hours a week,” Castle proudly noted to a Wall Street Journal reporter. “But I work 60 hours a week because I want to, not because I’ve got a time clock.”
Castle probably shouldn’t have made that time-clock reference. The enterprising Journal reporter promptly put Castle himself on the clock, figuratively speaking, and followed the New York banker around for a day in the middle of a winter work week.
That day opened, in Florida, with Castle showing off his $11 million Palm Beach estate. Later, the Journal watched Castle wile away the afternoon hours jumping hurdles “astride one of his show horses at his nearby 10-acre farm.” The day ended on the water, with Castle nibbling cheese and crackers aboard his yacht.
This busy day, the Journal reported, hardly qualified as out of character for Castle. During the winter months, he spent a few days at his Florida estate every week. And Castle, the Journal added, also found time to organize a private expedition to the North Pole, climb his way up and down mountains in Africa and the Himalayas, and send his yacht on a two-year voyage around the world.
As an ever diligent and hard-working executive, Castle didn’t have the time to personally skipper his yacht the entire way. Instead, he would fly overseas to meet up with the yacht at exotic ports of call, then captain the vessel for a week or so of sailing until duty called him back to New York. Castle logged almost 150,000 air miles in the process. All time well spent. Chief executives, Castle told the Journal, “need some time to step back and get the broader perspective.”
How many wealthy people labor at schedules as grueling as John K. Castle’s? A sizeable number, apparently. One 1998 Management Resource Group study of Americans who make at least $1 million a year, the Washington Post reported, found that over 20 percent of these deep pockets were taking at least two months of annual vacation.
About a decade later, amid the early stages of Wall Street’s financial meltdown, Bears Stearns chief exec James Cayne became the emblem of sorts for CEO sloth. In the same 2007 month his firm began tottering, Cayne spent ten “working” days either playing bridge or golf.
Cayne had plenty of deep-pocket company on the links. In 2016, the Harvard Business Review reported on research that unearthed “several CEOs who recorded more than 100 rounds of golf in a single fiscal year — roughly one round every three days!”
Now some exceedingly rich people undoubtedly do “work hard” and put in long hours. How many? Hard to say. CEOs and hedge fund kingpins, after all, punch no time clocks. And if they did, would they punch out before joining a potential investor for dinner? Would they log as work time the hours they spend on golf links mixing putts and patter with potential takeover targets? Would they count as office hours the morning commutes they spend chatting on cell phones in chauffeured limousines?
Profound questions. We seem destined to never know exactly how many hours rich people like Michael Bloomberg spend working. But even if we could calculate such a figure, and if that figure were 60 or 80 or 100 hours a week, would these rich then deserve many millions of dollars a year for their labors? That case would be hard to make.
Average Americans who take second jobs to make ends meet routinely work 60 to 80 hours a week without receiving anything remotely close to the robust rewards top execs in the business world regularly pocket. If moonlighting Americans don’t deserve king-sized rewards for the long hours they put in, then why should “hard-working” executives deserve regal rewards for theirs?
Our society obviously places no particular premium value on sheer hard work alone. Nor should it.
“It is not enough to tell me that you worked hard to get your gold,” as Henry David Thoreau once observed. “So does the devil work hard.”
Working hard, Open Democracy economics editor Laurie Macfarlane noted last week, will indeed “generally help you earn more money,” but “not all wealth has been attained through hard work.”
“In practice,” adds Macfarlane, “the distribution of wealth has little to do with contribution, and everything to do with politics and power.”
“No one makes a billion dollars,” as Rep. Alexandria Ocasio-Cortez put it earlier this month at New York’s famed Riverside Church. “You take a billion dollars.”
Michael Bloomberg, a $62-billion-dollar man, has taken plenty.
Gary Reber Comments:
Gary Reber Comments:
Herbert Marcuse, in his one optimistic volume: Eros and Civilization: A Philosophical Inquiry Into Freud, suggested that work be redefined. All work not done by choice is toil. Work freely chosen can be viewed as a form of play. He felt if we could lower the toil week below 25 hours, civilization would experience a remarkable, extremely positive, transformation. Technology has made that possible.
Yes, technology is a virtually never-ending progression to save labor, but it can only really benefit those individual who have significant ownership stakes in this non-human factor of goods and services production.
Michael Bloomberg, as with all multi-millionaires and billionaires have benefited from access to financial capital (money) via either from family money, an inheritance, or a pedigree and connections with wealth who provide “insider” investment opportunities. Eventually, all these factors play in the continuance of wealth building in families. Hard work, as in toil work on or off a time clock or for survival, is not a factor. But even if it was a factor, what would it take––60 or 80 or 100 hours a week? The math just does not add up to becoming a multi-millionaire or billionaire.
No, the source of wealth and income derived from wealth is the ownership of productive capital assets. Michael Bloomberg and Tom Steyer both know the source of their billionaire wealth is their ownership of productive capital assets, yet the question that needs to be addressed is why do not either advocate broadening productive capital asset ownership by providing equal opportunity to EVERY child, woman and man to gain access to productive capital ownership, particularly equal access to self-liquidating capital credit, to improve their economic wellbeing? Of course, this is a criticism that should extend to every one of the Democratic presidential hopefuls.
Without reform, the system will continue to limit access to capital acquisition to those who already own capital — the rich. This is because “poor” people and the majority of Americans have no security or collateral, or sufficient income resulting in savings to pledge against capital credit loans as security in the event full repayment does not occur, and/or are disqualified on the grounds of either unproven unreliability or proven unreliability.
Over the past century there has been an ever-accelerating shift to productive capital — which reflects tectonic shifts in the technologies of production. The mixture of labor “worker” input and physical capital “worker” input has been rapidly changing at an exponential rate of increase for over 240 years in step with the Industrial Revolution (starting in 1776) and had even been changing long before that with man’s discovery of the first tools, but at a much slower rate. Up until the close of the nineteenth century, the United States remained a working democracy, with the production of products and services dependent on labor worker input. When the American Industrial Revolution began and subsequent technological advances amplified the productive power of non-human capital, as it has to this day, plutocratic finance channeled its ownership into fewer and fewer hands, as we continue to witness today with government by the wealthy evidenced at all levels. While historically, the expansion of productive technology had created jobs, today the trend is that the new jobs being created are increasingly being filled by a “machine” at inception, while the jobs remaining still rest in the crosshairs of technological development and application.
What we are experiencing is the ever-greater substitution of machines for human labor and at the same time greater world-wide competition to produce goods, products and services at the lowest cost. This makes for a poor position for those (the vast majority) who can only depend on their labor to earn income. That being the reality, what really makes wage slaves is being without capital ownership in any significant degree. Capital is the non-human factor of production. Fundamentally, economic value is created through human and non-human contributions. In simple terms, there are two independent factors of production: humans (labor workers who contribute manual, intellectual, creative and entrepreneurial work) and non-human capital (land; structures; infrastructure; tools; machines; robotics; computer processing; certain intangibles that have the characteristics of property, such as patents and trade or firm names; and the like which are owned by people individually or in association with others). With capital carrying out most production these days, and the market rate of wages declining in value relative to the cost of capital, what locks people into the wage system in which most people get the bulk of their income from wages is lack of access to capital credit, not the wages, per se.
Understanding that productive capital is increasingly the source of the world’s economic growth one logically should conclude that productive capital should become the source of added property ownership incomes for all. Once can postulate that if both labor and capital are independent factors of production, and if capital’s proportionate contributions are increasing relative to that of labor, then equality of opportunity and economic justice demands that the right to property (and access to the means of acquiring and possessing property) must in justice be extended to all. Yet, sadly, the American people and its leaders still pretend to believe that labor is becoming more productive, and ignore the necessity to broaden personal ownership of wealth-creating, income-producing capital assets simultaneously with the growth of the economy.
We need to shift to a democratic growth economy. In such a future economy, the ownership of productive capital assets would be spread more broadly as the economy grows, without taking anything away from the 1 to 10 percent who now own 50 to 90 percent of the corporate capital asset wealth of the existing economy (until transferred at death). Instead, the ownership pie would desirably get much bigger and their percentage of the total ownership would decrease, as ownership gets broader and broader, benefiting EVERY citizen (children, women and men), including the traditionally disenfranchised poor and working and middle class. Thus, productive capital income, from full earnings dividend payouts, would be distributed more broadly and the demand for goods, products and services would be distributed more broadly from the earnings of capital and result in the sustentation of consumer demand, which will promote economic growth and more profitable enterprise. That also means that society can profitably employ unused productive capacity and invest in more productive capacity to service the demands of an environmentally responsible growth economy. As a result, our business corporations would be enabled to operate more efficiency and competitively, while broadening wealth-creating, income-producing ownership participation, creating “new capitalists” and jobs and “customers with money” to support the goods, products and services being produced.
And how to bring about this state of affairs? Capital Homesteading suggests one way.
The Democratic presidential hopefuls should support the enactment of the proposed Capital Homestead Act (aka Economic Democracy Act and Economic Empowerment Act) at http://www.cesj.org/learn/capital-homesteading/, http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/, http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/ and http://www.cesj.org/learn/capital-homesteading/ch-vehicles/. And The Capital Homestead Act brochure, pdf print version at http://www.cesj.org/wp-content/uploads/2014/11/C-CHAflyer_1018101.pdf and Capital Homestead Accounts (CHAs) at http://www.cesj.org/learn/capital-homesteading/ch-vehicles/capital-homestead-accounts-chas/
