Contact Us

Use the form on the right to contact us.

You can edit the text in this area, and change where the contact form on the right submits to, by entering edit mode using the modes on the bottom right. 

         

123 Street Avenue, City Town, 99999

(123) 555-6789

email@address.com

 

You can set your address, phone number, email and site description in the settings tab.
Link to read me page with more information.

IMG_0944.JPG

On Life

Ruminations and provocations.

Filtering by Tag: low prices

Corporate apocalypse: Feeding the hand that bites us

Stephen H. Provost

1920: The customer is always right.

2020: The stockholder is always right.

This ain’t your grandfather’s capitalism. The myth of American capitalism endures: If you have good ideas and work your ass off, you’ll get ahead. But the reality is very different: Instead of rewarding hard work and pursuing customer satisfaction, modern capitalism is designed to reward shareholders, and everyone else be damned.

Two things made this possible:

  1. Corporations replaced small business as the dominant force in the nation’s economy.

  2. Convenience replaced service as the most important element (along with price) in the consumer’s daily lives.

Convenience is king

As customers demand more convenience, business is motivated to provide it. But doing so requires technological advances that, in turn, require investment – often more investment than a small business can afford to make. It’s only natural (and sometimes, perhaps, essential) that such a business seek outside money to finance the necessary improvements.

The problem is that, once a business secures financial backers, it becomes responsible to them rather than its customers, much less its employees. Shareholders want a business to maximize profits and minimize expenses, regardless of the cost to worker morale, consumer service or even the company’s reputation. Just hire a glitzy PR firm and make some strategic donations to charity, and you can still look like a good guy even when you treat your employees and your customers like shit.

Andrew Carnegie used part of his fortune to create libraries, but does that make him a “good guy” when he earned that money by paying his employees a pittance and pushing them beyond their limits?

A return to the late-19th century world of Carnegie becomes easier when convenience and immediacy are valued more highly than quality and service.

When service doesn’t matter as much as convenience, the people who provide that service become expendable. When you pump gas yourself, you don’t need an attendant to do it for you. When you buy goods at self-service check stands, you don’t need cashiers anymore. When people demand news the moment it “breaks,” you don’t need copy editors to check for spelling or accuracy, you just need a program to make sure you’re online first.

The Matrix has you

But in demanding convenience, consumers have put themselves in a bind – and, in many cases, have cut off their collective nose to spite their face. How convenient is it, for instance, to navigate a phone tree, then wait on hold for an hour until the next customer service rep is free to take your call (or start all over again when you press the wrong button or you’re “accidentally” cut off)? How convenient is it to use one of those self-service check stands when the scanner keeps malfunctioning? Or to check the accuracy of a story via Snopes because journalism is done on the fly, rather than with care and precision?

Then there’s the identity theft that comes with using debit cards and computer programs vulnerable to hackers. Now that’s really convenient! (Note sarcasm.)

Here’s the rub: Convenience doesn’t always make life easier, at least not in the long run. It often just frees up more time for us to become busier, take on more commitments and, in the end, become more stressed out. We’ve devalued human interaction as consumers, and that interaction becomes the first thing we sacrifice in our personal lives when we start to feel overloaded. The result is a vicious circle of busyness and isolation.

We become, in a very real sense, dependent on – even addicted to – convenience and instant gratification. And, as with any addiction, the “highs” get less intense, the “lows” get lower, and the dependency grows stronger as time goes on.

Corporations know this and, as we become more dependent, they have less incentive to provide that high. Because. They. Have. Us. Hooked. Once they do, shareholder and consumer interests that once seemed aligned in the quest for convenience are no longer in sync. For corporations, convenience was always just a means to an end: maximizing profits for shareholders. Once it no longer serves that purpose, corporations will discard it like yesterday’s news.

Toxic capitalism

When’s the last time you stopped at a full-service gas station or were put directly through to a live operator willing and able to answer your questions? It’s probably been a while. That kind of service has largely gone by the wayside, and (in most places) you no longer have any option but to pump your own gas or navigate that phone tree. It all happened right under our noses, so gradually we barely noticed. But now, here we are, and we’re no turning back.

Once they’ve eliminated all our other options, corporations have no more incentive to provide service, convenience, low prices or anything else. The consumer becomes irrelevant, and only the shareholder matters. Instead of personal service, we get automated phone trees and overseas operators. Instead of quality, we get planned obsolescence. We were supposed to have learned this lesson more than a century ago, when monopolies were working employees to death (literally in some cases) and foisting off bogus “miracle cures” on consumers. But apparently, we’re going to have to learn it all over again.

Capitalism works well when it encourages competition; when it discourages it, it’s toxic.

Want evidence? What ever happened to Marshall Field’s or Rich’s or Filene’s or Jordan Marsh? They’re all Macy’s now. Every single one of them. In the 1960s, there were dozens of regional discount retailers; today, there’s Walmart. And Target.

As Facebook has all but cornered the market on social media access, has it become more flexible or more controlling? Have those controls become more in tune with the user or the shareholder? Since Facebook went public, its quest to maximize profits by allowing corporations access to personal profiles – and by looking the other way on Russian interference – has been widely publicized. But we still use it because most of our friends are there, not on Ello or MeWe. We’re addicted. We’re stuck.

Tainted government

The government, meanwhile, enables and accelerates this process. It’s no secret why this happens: The same corporations that have the money to invest in business have the money to lobby Capitol Hill – to their benefit, and to the detriment of their competitors.

Many of those competitors are small businesses, who then have little choice but to go public themselves so they can get money to pay for their own lobbyists.  

The 2018 tax cut is a great example of how this works. Whom did it benefit most? Small businesses that need help to compete or corporations that will use the advantages to consolidate their stranglehold and eliminate even more choices?

We know the answer to that question.

Before the trust-busters broke up Standard Oil’s monopoly at the dawn of the 20th century, cartoonists portrayed it as an octopus, with its tentacles wrapped around everything from the U.S. Capitol to statehouses to investors. Walmart, Amazon, Facebook, Google and others are on the brink of becoming today’s version of Standard Oil.

Customer service died decades ago. Convenience is on its last legs. Can a return to snake oil and sweatshops be far behind?