Monday, September 16, 2013

Corcoran Misses The Point On Income Disparity

On CBC's "The House" this weekend, I heard an interview with the Financial Post's Terrance Corcoran, in which he was basically poo-pooing the very real issue of the growing disparity between Canada's top earners and the rest of Canadians.  He made a comparison between a pensioner pulling in $20,000 a year and an executive making $190,000 and said "who cares?" - a statement which trivialized the entire discussion and leftA little digging this morning, and I find that he has more or less made the same points in one of his FP editorials.
If Canadians actually seriously look at the income data instead of following instant Occupy interpretation in much of the media they might end up feeling pretty good about income distribution in Canada.  The Canadians within the top 1% cover a wide cross-section of professions and occupations.  Almost 70% of the 1% have univeristy educations, as does 50% of the top 10% of income earners.
The lesson:  Getting the right higher education pays.
How generous of Mr. Corcoran to patronize us with the old saw about higher education.  Education is important, but it is far from the entirety of the story. I do note that he turns the knife with an extra twist by adding that it has to be "the right" higher education.  Presumably, like most of the far right in this country, Corcoran is among those who believe that the only degrees which matter are the so-called "useful" degrees:  Business, Engineering, and so on.  "Lesser degrees" like English, Philosophy and so on don't count.
That's not the Occupy idea, which is that inequality is a function of a corrupt 1% populated by system manipulating, fat-cat bankers, investment executives and Wall Street/Bay Street corporate gougers who are skimming massive bonuses out of semi-corrupt boards of directors ... 
Having sat close enough to the executive suite in my own career, watching a company grow from a modest size to being part of a frighteningly huge organization, I have seen first-hand the way that decisions get made.  A smaller organization's leadership is closer to the day to day business problems and is capable of responding to them appropriately - balancing both financial and human factors appropriately.  At a certain size, things become entirely abstract in the boardroom, and the business' leadership is dealing not with people and clients but all the executive sees are numbers.  People become numbers, salaries are numbers, and profits are numbers ... so are the bonuses.

When business starts looking at its people as "expenses", rather than as assets, things go seriously awry.  We are seeing this in the service industry today - companies like Wal-Mart, Loblaws, Sobey's are all cutting staff and wages to the point where getting service in their stores is next to impossible.  (The Sobey's near me has had seriously empty shelves in the produce area on Saturdays quite frequently, and their shelves are often half empty in the rest of the store)  There are explicit policies in companies like Wal-Mart which are designed to cap a worker's hours to limit the company's "wage expenses".

These are very real problems.  Worse, they are symptomatic of a malaise that reaches much further than the service industry jobs (which are often the entry level jobs for so many beginning their working careers).  In higher paying, professional companies, there are similar games going on which are designed at their core to tie the worker to the company and its fortunes.  I've written quite a lot on this subject on this blog under the label of Corporate Feudalism.  Make no mistake about it, the whole "outsourcing" game of sending jobs overseas where wages are cheaper and laws are more lax about how employees can be treated is another dimension of the same evil - and it's an approach to business that is similar, only it ends up affecting higher paid, professionals such as IT specialists.

What Mr. Corcoran, sitting comfortably in his high chair at the Financial Post is misconstruing about the "Occupy" movement and its offshoots (or unions come to that) is that they are really about the growing exploitation of the lower income earners by the top income earners.  It is about the sociopathy of large corporations and their boards which are so abstracted from the people that their decisions affect that they make increasingly abusive decisions.

Income disparity is a symptom of a problem, not the problem itself.

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