American Companies and Exploitative Capitalism

 

 

Musing About American Companies and Exploitative Capitalism

 

 

While researching, I came across this news article by USA Today detailing how DoorDash has to pay millions to drivers in New York. 

The reason? 

DoorDash used a deceptive model where they subsidized their base pay through tips people gave the drivers. 

 

Grubhub isn’t immune from exploitation either. Nation’s Restaurant News stated that:

“Grubhub will pay a $25 million settlement following an investigation by the U.S. Federal Trade Commission and the Illinois Attorney General that found alleged “unlawful practices” that include deceiving consumers about delivery costs and fees, deceiving delivery drivers about profits they would make, and unfairly listing restaurants on its platform without permission from the businesses.”

Oh, and during the pandemic (2021 era), Grubhub charged more for delivery than they were legally allowed to. Massachusetts had a 15% cap on delivery fees, whereas the Attorney General’s office found changes northwards of 18% or more. $3.5 million is what they were ordered to pay.

 

Uber and Lyft have participated in pay schemes, also. The New York Attorney General’s office reported that $290 million had been secured from Uber and $38 million from Lyft – all owed to drivers. 

 

And this is just the tip of the iceberg. Companies do this ALL THE TIME in the United States; they are incentivized to break the law when the penalty for doing so is not punitive enough.

 

Exploitative Capitalism – What Does This Mean?

 

Joseph Stiglitz, in his book People, Power, and Profits,  writes that,

 

“I have to explain the true source of wealth of nations, distinguishing wealth creation from wealth extraction. The latter is any process whereby one individual takes wealth from others through one form of exploitation or another. The true source of ‘the wealth of a nation’ lies in the former, in the creativity and productivity of the nation’s people and their productive interactions with each other.”

 

Elsewhere he states,

 

The American economy today is characterized, to too great an extent, by underregulated, monopolistic markets, where wealth creation has been replaced by exploitation.”

 

For my part, I believe he is right. I believe our American version of capitalism – a bastardized form of capitalism that built the middle class – is exploitative in nature and does more to extract wealth from middle-class workers.

It also indicates that many of our elected officials do NOT represent the people they are supposed to. 

Why do I say that – especially when the Attorney General of New York and Illinois are cited along with the FTC? 

Because if the laws were stiff enough to prevent worker exploitation in the first place, we would see FAR LESS. But we don’t. Instead, we see loophole after loophole and millions spent by corporate lobbyists. 

Constitutional Republic? More like Corporate Oligarchy. 

 

Battling Exploitative Capitalism – What’s Next?

We can’t ignore things and hope they go away – we have to start somewhere

 

Elsewhere I’ve stated that we have some serious problems with our economic model. For what it’s worth, there are plenty of people who are NOT socialists – they merely have serious critiques of our current form of capitalism – and I am one. Peter Georgescu is another. Peter Drucker was yet another. These are prominent people in the business landscape who see the systemic problems we have and are sounding the horn. It will not do for us to slander others who have an honest critique – that is the first thing we need to do. Unless we can have open discourse we will not solve anything. 

Second, we don’t know what we don’t know. The internet has vast resources available at our fingertips – and yet we use technology to numb, entertain, and distract ourselves from the problems in the world today. We need to amplify voices so the word gets out to those who are unaware. This means reading/listening, sharing, and subscribing to those who are digging into things like this.

Third – and I hinted at this earlier – companies are incentivized to break the law when the penalty is feckless and weak. If we want to hold people and companies/corporations accountable, we must demand change. This is true at the political level and also at the everyday human being level. There are several things we can do, but here at The Wealthy Ironworker, I ask that you consider signing the two petitions outlined below:

 

 

Increase Penalties for Child Labor Violations

Demand civil/criminal personal penalties for willful violations of US labor law

 

 

Lastly, be sure to give those individuals who are doing the research, writing, and spotlighting on the shenanigans taking place. They don’t want to feel like they aren’t heard or listened to. 

We have a LONG way to go before we make any strides – and if I’m honest, I believe it will get worse before it will get better, but people reach a breaking point, and I’m optimistic that the power is with the people…if they will only use it. 

It gets old seeing companies exploit workers and always feeling like we are on the defensive.