Tuesday, June 21, 2011

There's a difference between "business" and "big business."

One of the complaints that conservatives have about liberals is the allegation that liberals are "anti-business."  You always hear conservatives say that liberal policies will "hurt the small business owner" or be "bad for business and innovation," or something to that general effect.  It's a calculated strategy that has worked with some success pretty much since the Reagan era.  Basically, when it comes to attempts by liberals to regulate "big business" and reign in their greed and reckless disregard for things like employee rights, environmental impact and adherence to basic safety regulations, conservatives are quick to put all business on the same fictitious "level playing field," where "big business" means "all business" and "upper class taxes" mean "tax hikes for all of us."

“Socialism never took root in America because the poor see themselves not as an exploited proletariat, but as temporarily embarrassed millionaires.” - John Steinbeck

This brilliant quote perfectly encapsulates why it is that hard-working, middle class Americans and struggling small business owners and everyone else in America who isn't the upper 1% and doesn't sit on the board of directors for a major multi-national corporation are so willing to allow the lines to become blurred that separate them from the "big's" in our country, so that they actually allow themselves to believe that they really are all in the same boat.  "Tax increases for mega corporations is bad because tax hikes hurt business and I'M a business owner!"  Well... there's a slight difference between your mom & pop café and McDonalds...  "Tax increases on rich people's incomes are bad because I make a good income and I don't want my taxes to go up!"  Well... there's a slight difference between the average middle class household income and that of the guy who runs the company...

But, that's how this strategy works though.  You convince small business owners that they are in the same boat as GE or Exxon/Mobil and you convince the blue-collar working Joe that he's in the same boat as the guy who runs the corporation that owns the company that controls the regional distribution center where he busts his ass on a forklift all day.  It's unfortunate that this strategy is so effective, because it's also so completely detrimental to the best interests of those hard-working, struggling Americans who want to desperately to believe that they are in the same boat as people who, historically and statistically, wouldn't even throw them a life preserver if they saw them drowning.

The fact is, there's a difference between "business" and "big business," just like there's a difference between "employee" and "employer."

Just look at how the two different entities behave.  Small businesses have to play by the rules, they have to pay their taxes, they have to abide by regulations.  If small businesses don't do these things, the IRS steps in, the regulatory agencies step in, and the business is no more. 

What happens, for example, when you walk into a mom & pop restaurant and see ants, cockroaches or other signs of a filthy, unsanitary establishment?  How long do you think a small, family-owned restaurant gets to stay in business after it sends a couple people to the hospital with food poisoning?  How long before the health inspector is there shutting the place down until it complies with it's regulations?  What if the owners of that restaurant maintained a clean, well-run and successful business instead, serving delicious food and enjoying a packed house every day, along with a steady stream of revenue, that they chose to avoid paying all their due taxes on?  How long before the IRS shows up to shut the place down and seize everything of value they can liquidate to pay off the owner's tax obligations?

Now, let's look at a "big" food business.  How many times have you walked into a fast-food chain and thought the place looked a filthy mess?  I have eaten in fast food places and watched a trail of ants crawl up the wall, or seen cockroaches scurry from under benches.  In fact, every time I have ever gotten food poisoning from eating out has been from a fast food place.  The worst bout I ever had, that had me either laid up in bed or hunched over the toilet for 2 solid days, was thanks to a Taco Bell on I-5 in CA, a Taco Bell that is still open right now.  Which brings me to my point, how often do you see major fast-food or restaurant chains being taken to task for unsanitary conditions, for giving their customers food poisoning?  I remember Jack in the Box had a huge controversy a decade or so ago because they were under cooking their meat and caused the e-coli deaths of some infants, and it seems that's the point when "big business" finally gets called on it's actions, when babies die.  Well, most of the time anyway...  Regardless, after suffering financially from the e-coli scare backlash, Jack in the Box relaunched what has been widely considered the most successful corporate re-imaging campaign in modern history, completely turning the company around and overcoming the e-coli poisoning stigma that many had speculated would be the end of the corporation.

How many small businesses would be doing better than ever today if their food killed a half-dozen babies 10 years ago?

You can make the argument "Well, companies like Jack in the Box have the money and the resources to weather a storm like that and invest the capital necessary to re-image themselves and survive something like that."  To which I would reply, exactly, and that's the difference between "business" and "big business."  "Big business" has the resources to get away with indiscretions that small businesses would never survive.  Is this a good thing or a bad thing?  Is it good that a company can be directly responsible for killing people due to negligence in the preparation of it's products and ultimately come out of it bigger, better and stronger than ever?  Is it good that a company can be so big that, rather than behave in a manner that shows concern for the well-being of it's customers, they instead just throw settlement money at everyone they hurt and make the problem go away?

McDonald's currently buys so much of the countries supply of potatoes, beef, chicken, tomatoes, lettuce, eggs and other ingredients to their products that they can actually dictate the conditions by which those products are grown/raised, processed and prepared.  They do this because it's essential that a McDonald's hamburger tastes the same no matter where you get it, that their fries also always have the same signature flavor.  They were the first fast-food establishment to run their kitchen like an assembly line and they demand a consistency of ingredients, so that the same "food assembly" rules are applicable in every location in the country.  No small business restaurant will ever compete with McDonald's.  For that matter, no small business restaurant will ever compete with any "big" fast-food corporation, for the simple fact that these businesses are so "big" that they control other industries that supply them.  They control so much of the market, that they operate at a cost-per-unit level that is absolutely impossible for a small business to ever achieve. 

Joe's Burger Shack might make a cheeseburger that kills anything you could ever get at a fast-food place, but it's also going to cost more.  It's going to cost more because Joe has to pay more for his beef, his cheese, his fresh produce, his fries or potatoes, and so on.  If Joe decides to open up a couple other locations and they also do well, that's great, but if Joe ever decides he wants to really expand, go national, take on the big boys... he better have some powerful friends and some very wealthy benefactors to help him get his foot in the door.  Chances are more than likely he will have to strike some kind of partnership deal with a Coca Cola or other "big" business to help him get the purchasing power to realistically compete in the industry.  Soon, he will have to start cutting back on the quality of his product - smaller burgers, less toppings, lower-quality beef, and so on - in order to stay competitive from a pricing standpoint.  Basically, in order to compete with the "big" businesses, Joe will have to act like one of them, and that means lowering quality, lowering standards and lowering wages all in the interest of lowering prices and still staying as profitable as possible.

Remember what I said before about businesses not being able to get away with killing babies?  Well, when the business is the "big food" lobby, or "big pharm," just to name two, sometimes you can get away with it.

This clip is from the documentary "Food Inc." and tells the heartbreaking story of Kevin Kowalcyk, a young Colorado boy who died 12 days after eating a hamburger contaminated with e-coli O157:H7.  His mother, along with representative Anna Eshoo, introduced a bill, commonly referred to as "Kevin's Law," that sought to set guidelines for pathogen and contamination levels in meat and poultry, and would give the FDA more power to ultimately close down processing plants that failed to meet these guidelines for food safety.

This bill was introduced in 2005, and never became a law.  It was referred to committee, where it was never reported or voted on.  Every year since then, a new version of this bill has been introduced, and every single year it dies in committee.  It's a relatively simple bill, it has 3 principal components:
  1. Requiring the USDA to identify pathogens in food that are life-threatening.
  2. Requiring the USDA to establish performance standards to reduce these life-threatening pathogens.
  3. Giving the USDA ultimate authority to close down plants that continually breach these basic safety regulations.
Seems pretty straightforward and agreeable, no?  I mean, who doesn't think that making sure your meat and poultry doesn't contain any bacteria or contaminants that will kill you is a bad idea?  Certainly, these companies aren't willing to make these assurances themselves, so a little nudging from the department specifically established for the purpose of guaranteeing a quality standard in all food grown or raised in the U.S. is a good thing?  However, in spite of it's simplicity and completely logical and agreeable set of guidelines, this bill never makes it out of committee and Kevin's mother goes through yet another year without her son, wondering how many other moms will have to bury their young children because of food contamination her simple bill could have prevented had it become law.

The lobbying groups for "big food" aka, the meat and poultry processing industries this law would affect, have argued that passing this bill into law would increase food prices and is "unnecessary."

And just like that, "Big business" gets away with something "business" never would - killing kids and influencing government to give them a pass on it.

Still think the "big" farming and ranching corporations are in the same boat as the family farmer?  Why don't you go start up a family-owned farm, raise some chickens, let some people get salmonella from them and see how long your business lasts.  Better yet, see if you can even stay out of jail for it.  "Big business" isn't the same thing as "business."

I suppose I could make the same arguments about other "big" businesses, like the oil industry, "big pharm," and "big" media, except small businesses can't even get into those industries.  You can't just start up an oil company out of your home.  You can't just start manufacturing prescription medication, (they call that running a "drug lab"), and you certainly can't start your own TV or radio network, not without FCC approval, and we know who they work for...

So, where does that leave us?  It leaves us with roughly 5-6 major corporations controlling 90%+ of every major industry in America.  It means any time you buy groceries, fill prescriptions, fill your tank, turn on the TV, open a newspaper or magazine, open a soda or bottle of juice, make a phone call or cash a check, that transaction is being handled by one of 5 or 6 companies, that money is going into their bottom line.

Why do McDonald's burgers taste like shit?  Because every fast food burger tastes like shit.  I'll ignore statistical anomalies like In n Out, who operate at an illogically high standard in terms of food quality and employee compensation, and only have legendary status as the best chain burger place in the western U.S. to show for it, because clearly they're idiots.  I mean, they could make their burgers half as good, twice as fast and earn double the profits, if they would just skimp on quality - both of ingredients and employees.  However, they stubbornly adhere to a freshness standard and they insist on paying their employees the highest wage of any major fast-food chain.  Those poor fools, when will they learn?  However, besides In n Out, every fast-food place is giving you roughly the same shitty product for the same approximate price and paying their workers the same minimum wage.  When every major fast food chain has a double cheeseburger for $1.00 and their large cokes are all right around $2.00, where, exactly, is the competition and choice?  I mean, you're getting almost the exact same product for almost the exact same price and the only real difference is the name on the bag.  Is that competition?  Is that choice?  Why can't any one of the tens of thousands of far superior family-owned burger places in the country step up and compete, where their superior product would surely win the consumer over?  Because they can't compete.  They aren't allowed to compete.  They have to play by a different set of rules, a set of rules designed to keep them in their place, enjoying their tiny piece of the pie, that they voted on because a conservative in a tidy suit told them they were "in the same boat" as McDonald's.  Sorry, life preservers are for closers...

Why does gas cost roughly the same at every station, regardless of the company who owns it?  Because all the gas produced in this country is done by one of about 5 major corporations.  You don't want to pay $4.20 at the Chevron?  Ok, go to the Shell and pay $4.10, or the BP and pay $4.05 or the Valero and get the real cheap stuff at $3.99.  Is that really a choice?  Saving 10-15 cents a gallon, is that really competition?  Most people buy gas based on the station that's most conveniently located to their house, regardless of price, or based on the one they have a gas card for.  That's because brand is irrelevant, the quality is the same, and the prices are almost identical.  Is that choice?  Is that competition?  Where's the small-business oil company to come in and offer a higher-quality fuel at a lower price?  Oh, that's right, there are so many barriers to entry into the petroleum industry that it's impossible for a small oil business to exist.  There's a difference between "business" and "big business."

I talked, rather harshly, yesterday about the double-standards that the wealthy and famous in this country live by.  The seemingly separate set of rules by which they live their lives and adhere to compared to the rest of us who have to always do what we're told or face the consequences.  The same way that rich and famous people think they are above the laws that govern "commoners" is the same way "big business" thinks it's above the law that regulates businesses that don't have the resources, the lobbying power and the bought and paid for politicians to help them get around those pesky laws and regulations and rules that the rest of us have to play by.  It's past due the time for we, the majority, in this country to stop allowing the elite minority to play by a different set of rules than the rest of us.  It's time we stop allowing "big business" to hide behind the little guy and use struggling entrepreneurs and hard-working blue collar families as political human shields to defend them from having to play fair like the rest of us.  They aren't in the same boat we are.  They're in the boat and we're all clinging to wreckage, trying to keep our heads above water, and hoping they don't decide that the piece of debris we're clinging too would be of better use as a cushion under their fatted, spoiled asses.

Just because you and your boss both work for the same company doesn't mean you're in the same boat.  Just because you and McDonald's can both make a hamburger doesn't mean you're in the same business.  The sooner middle-class conservatives can realize and understand this, seemingly elementary fact of life, the better our country will be.  The sooner the struggling working class and the over-regulated small business owner realize that supporting the conservative agenda means supporting continuing to make your lives harder, the better off we'll be.  The sooner middle-class conservatives realize that "welfare" isn't just the money single moms get to buy food and milk and get cheap housing, but it's also the billions that "big business" gets to keep dominating their industries and stifling competition, the sooner we can start returning to the days when the American middle class was the strongest working class in the world, when our products and services were the envy of the planet.  Look around you, if you're hanging on to a piece of door and 75% of your body is underwater, you're not in the same boat as "big business" and the wealthy elite, you're not even in a boat.  It's time to point out the fact that the king isn't wearing some super-trendy new outfit made of amazing materials, he's just naked.  

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