Once upon a time in America business had what was referred to as the "social contract" the idea being that your employees gave of their time to you and gave you loyalty and their intellectual work. In return, companies also gave loyalty and promises of security if you stayed and kept up your end of the bargain.
In the early 80s an economist named Milton Friedman came into prominence. He believed that the idea of the social contract was tantamount to socialism. He linked the two in everyone's mind even though they are not the same idea at all. He said the deal between business and its employees was simply a business arrangement. You gave work they gave money. If you didn't work to their satisfaction they gave you no money. If you could find some one else to give you more money you left. initially, this worked well for everyone.
But, they soon discovered that employees who have no loyalty to the firm will do what is in their best interest not what is good for the long term viability of the company. Many firms had self funded self sustaining pension plans made up of the money put in by the firm, and its employees over many many years. Under Friedman this money was a loss. It was just sitting their. So he convinces the powers of the time to change the laws and allow firms to "spend" pension money on the promise that they would make more money by spending it and would easily be able to handle the pension debt later. They used pension funds like giant piggy banks. Many middle sized firms were bought out under hostile terms just for their pension fund. The new owner would empty the fund and the sell the firm at auction prices. Leaving them now with a future pension "debt".
Many people now scream about these horrible un-funded pension liabilities. These pensions were funded. The raiding of them was deliberate and not in any way the fault of the line employees who were sold away.
So few people seem to understand what happened to them or why the social contract was lost. The minute some one calls something - dang near anything - socialism they run screaming for the hills without any idea of what socialism is - or more importantly - what it is NOT.
When my husband had put in 20 years at his firm they laid him off. Then they offered him a "service award" - it was a gun.
C'mon. When no one in a firm believes in loyalty to their employer no one, not the line staff, not the CEO, is looking out for the best interest of anyone other than themselves. Congratulations to your father on his retirement. He got paid for 40 years - good for him! That's all he gets.
In the early 80s an economist named Milton Friedman came into prominence. He believed that the idea of the social contract was tantamount to socialism. He linked the two in everyone's mind even though they are not the same idea at all. He said the deal between business and its employees was simply a business arrangement. You gave work they gave money. If you didn't work to their satisfaction they gave you no money. If you could find some one else to give you more money you left. initially, this worked well for everyone.
But, they soon discovered that employees who have no loyalty to the firm will do what is in their best interest not what is good for the long term viability of the company. Many firms had self funded self sustaining pension plans made up of the money put in by the firm, and its employees over many many years. Under Friedman this money was a loss. It was just sitting their. So he convinces the powers of the time to change the laws and allow firms to "spend" pension money on the promise that they would make more money by spending it and would easily be able to handle the pension debt later. They used pension funds like giant piggy banks. Many middle sized firms were bought out under hostile terms just for their pension fund. The new owner would empty the fund and the sell the firm at auction prices. Leaving them now with a future pension "debt".
Many people now scream about these horrible un-funded pension liabilities. These pensions were funded. The raiding of them was deliberate and not in any way the fault of the line employees who were sold away.
So few people seem to understand what happened to them or why the social contract was lost. The minute some one calls something - dang near anything - socialism they run screaming for the hills without any idea of what socialism is - or more importantly - what it is NOT.
When my husband had put in 20 years at his firm they laid him off. Then they offered him a "service award" - it was a gun.
C'mon. When no one in a firm believes in loyalty to their employer no one, not the line staff, not the CEO, is looking out for the best interest of anyone other than themselves. Congratulations to your father on his retirement. He got paid for 40 years - good for him! That's all he gets.
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