CORPORATE FOCUS: In Your Own Best Interests
Surely one of the most amusing developments of the 2000 presidential election campaign is the emergence of Billionaires for Bush (or Gore), a project of the Boston-based United for a Fair Economy.
With chants and slogans like "Vote for Bush (or Gore) Because Inequality is Not Growing Fast Enough" and "Who needs day care, hire an au pair!" the Billionaires have highlighted not only the big money corruption of politics, but problems of growing income and wealth inequality in the United States.
Far less entertaining, but somewhat more surprising is a recent report from the Conference Board that also highlights how the current economic boom times have left low-wage workers behind.
The Conference Board answers the question posed by its report's title, Does a Rising Tide Lift All Boats?, with a telling subtitle: "America's Full-Time Working Poor Reap Limited Gains in the New Economy."
The report is important for two reasons.
First, it shows that distribution of the gains from the information economy have been extremely skewed, with benefits heavily concentrated among the wealthy and not shared among the bottom of the income and distribution curve.
"Poverty has risen in both the number and share of those employed full-time and year-round since 1973," the report finds. While the number of full-time workers making poverty wages declined dramatically in the 1960s and early 1970s (from just under 5 percent in 1966 to 2 percent in 1973), there have been no gains since then. In fact, the proportion of full-time workers making poverty wages rose to 2.9 percent in 1998, the most recent year for which such data is available.
The number of full-time workers earning poverty wages does not indicate the number of people in poverty, because it does not register the poverty rate among those without full-time work, nor does it take into account the effects of taxes, tax credits (including the important Earned Income Tax Credit) or government assistance for poor people.
But by focusing on wages rather than ancillary government support and taxation programs, the Conference Board offers a unique insight into the failure of the current wage distribution to enable families to escape from poverty. (The numbers would appear far worse had the analysis focused on a living wage level, which is significantly above the artificially low poverty level.)
The second reason the Conference Board report is important is because of what the Conference Board is.
The New York-based organization is a business-backed research enterprise best known for its monthly Leading Economic Indicators and Consumer Confidence Index. It is a dispassionate research agency, not a front group for the corporations that fund it.
Its trustees and officers represent a segment of the enlightened corporate class, those who are aiming to protect corporations' long-term interests. Among those corporations represented: Bestfoods, Phillips Petroleum, J.C. Penney, Excel, Texaco, Martha Stewart Living, Fidelity Management and Research, Goldman Sachs, British Airways, Unisys -- and yes, we know many of these may not seem "enlightened." But the point is that in their concern to head off social unrest before it develops, they may be willing to make significant concessions.
In a description of its historical origins, the Conference Board says it "was born out of a crisis of industry in 1916" when "declining public confidence in business and rising labor unrest had become severe threats to economic growth and stability."
The decision to focus a report on the failure of the new economy to provide above-poverty wages to millions of full-time workers suggests that there may be, perhaps, an emerging concern with income and wealth inequality among foresighted business leaders.
"For too long, we've only counted our money, but today we stand up and count ourselves. Billionaires, stand up and be counted!" proclaimed Phil T. Rich at the Million Billionaires March outside the Republican convention in Philadelphia on July 30.
The Conference Board may not be ready to join such mocking efforts, but these and other stirrings of discontent do seem to be worrying the Conference Board's corporate members.
Are the Conference Board members ready to support unionization and living wage regulations, among the obvious solutions to the problems highlighted in the organization's recent report?
Without a bit more of the "unrest" which led to the Conference Board's founding, probably not. But the publication of the report, the emergence of the Billionaires for Bush (or Gore) and aggressive union organizing of low-wage workers by some U.S. unions may in different ways signal that such unrest is now, slowly but finally, growing.