The guy sounds like a Communist. Let the free market economy reign and stop demonizing the people who have earned their money with the same opportunities that everyone else had. People talk about Trump being dangerous, my god, this kind of talk is more dangerous to the long term freedom of the country than anything Trump espouses.
I am going to share a story about when I changed my views on capitalism - at least the way it is pursued here.
I am going to take you back to the year 2007 - I was working for a major media conglomerate. This was/is a family owned business, with fewer than 100 shareholders, and 85+% controlled by a single family. The patriarch of the family started the business in the 1950s, and built it into one of the largest media companies in the country. By the early 2000s the business was largely divided into three units. In the mid-2000s the patriarch was retiring, and the family was looking to divest itself of its holdings. They sold one of the business units for $3.5B in 2008. They were actively looking to sell the unit I worked at for the same price point, and had reached the 2nd stage of bidding when the credit market collapsed - leading them to call off the sale.
I started my career at the company in the M&A department, where we were tasked with spending money every year on worthwhile business ventures - in the three years I worked there, I led 3 acquisitions, and led an internal start-up business. After one acquisition, I left the department to go run the business we acquired. The business I acquired was in the automotive division, where we had 10 companies who provided various services to automobile dealers and others in the automotive industry. Things went very well until the fall of 2007 - when the bottom fell out, and between October and March 2008 we saw 20% of our customers go out of business.
Being in the automotive division, all of our companies were hit hard - some more than others. We had a couple of growth-businesses that were still not making money, and this just made it worse. My particular business saw revenues and profits drop - we went from $5M in profits to a $4M run-rate in early 2008. From a top-of the business perspective, the entire division implemented austerity measures early in 2008 - we had a wage and hiring freeze implemented, all employees from the President on down, took a 2% pay cut, in the form of a 1 week unpaid furlough scattered throughout the year.
At that point, senior management decided that each business must cut 15% of expenses. For many businesses, this made a lot of sense - there was some bloat, with fewer customers, it was easy to cut back on some staff - like customer support - without affecting the quality of service. For my particular business, I had no real excess expense to cut - outside of personnel. I could not cut any of the cost of goods expenses - as without that we had no product, and we primarily had single sources for our goods - so we could not go elsewhere, or threaten to go elsewhere. But, my business was still in excellent financial shape - even after seeing our profits decline by 20%, we still operated at 40+% net profits - a really rare business that could maintain high profit margins, with virtually no competitors. So, bottom line, we were well positioned to weather the storm, no danger of losing money, and no excess fat to trim. I made my pitch to the president - but was told no exceptions, every business had to cut 15%.
So, in the middle of the great recession - I had to lay off 6 employees, and add to the workload of existing employees, at no additional pay, to meet my quota. In total I saved about $250K in expenses, including payroll and benefits, but put 6 people out of work.
To get to the end of the story quicker - our division finished 2008 with ~$15M in net profits. (Our Business Unit had two other divisions, that posted similar net profit numbers). In other words, the overall business took a hit in profits, but was never close to losing money.
Unfortunately, I am not the good guy in the story - I am more like the CEO in the story above. A part of my annual comp was my annual bonus that was based largely on how well we performed to budget. If you know anything about budgeting, you know that we started the budget process for 2008 in the summer of 2007, and were largely done by October. We made some minor last minute adjustments but the guidance was to assume a flat 2008. Needless to say, we missed budget on revenues and profits by a significant margin. But, because I, and others in my position, were deemed important employees - we got our full annual bonuses - enough to have funded 2 of those employees I laid off. I was just as greedy as the next guy - I never offered to put my bonus on the chopping block (though I did not anticipate that it would ever have been the full bonus).
I still think about this nearly 8 years later. In our drive to maintain corporate profits - that would benefit a single family who happened to sell one business for $3.5B, we put 100's of people out of work. People who could least afford it. And, while I am angry with some of the decisions we made as a company, I was a willing participant, and these types of decisions were being made all across America. We were so driven by bottom-line profits for shareholders - that we lost sight of the impact on employees. And, I think from a macro-economic standpoint, the economic recovery would have been better had companies sacrificed profits for the sake of keeping employees.
I believe very strongly that our economic and tax policies are too tilted toward shareholder benefits, that it hurts our economy when we see the impact on the vast majority of Americans - who are employees that are working harder, longer hours, and seeing real income stagnate over the last 30 years.
I now have my own business, and while its just me, I'd like to think that when I am ready to expand I will recall these lessons, and ensure that I find the right balance between employees and profits.
In the end, I think that corporate greed goes far deeper than just rewarding hard work of shareholders - many of whom do nothing to generate the wealth. It is simply greed for the sake of greed. I was once one of the greedy - I hope that has changed. I hope that Bernie's revolution takes hold, and we do see a dramatic shift in economic and tax policies.
Sorry for the long post.
