Bezos Sticks It to Amazon Workers: Minimum Wage Up, Earnings Down

Make Amazon Pay

You gotta to hand it to the money-grubbing suits with their hard eyes and big salaries and their head honcho, richest dude in recorded history Jeff Bezos. They’re all in when it comes to outfoxing politicians, activists, union organizers and the general public. Here’s their latest coup. As soon as progressive-in-chief Bernie Sanders introduced the Stop BEZOS Act making large employers financially liable when their employees are forced to rely on federal assistance programs like Food Stamps and subsidized housing, Bezos and his crew got creative and announced a $15 per hour minimum wage for all hourly workers.

Basking in the glow of high praise for their bold move, Amazon was not ready to rest on its laurels. A bigger prize loomed. Holiday sales, generating even fatter profits for the Amazon juggernaut, required 100,000 temporary seasonal slaves. With competition from other outfits in similar straits, workers were in high demand and could afford to be choosy.  This was no time for half-measures. The guy who once bragged that his employees “do more for less” and characterized Amazon’s compensation policy — “we pay very low cash compensation relative to most companies.” (Fortune Magazine, 2012) appeared to be giving away the store.

Even the difficulties involved in luring seasonal help to Amazon sweatshops paled next to the real elephant in the room—unions —that were beginning to make inroads not only at Amazon but at their 2017 acquisition, Whole Foods. Granted, Amazon’s anti-union stance was no outlier in corporate America. Most corporate big wigs would have sacrificed their grannies to keep unions out of their business. Amazon, as usual, was more inventive than most. Its anti-union defense was a carefully-crafted bunch of malarkey — “Direct connection is the most effective way to understand and respond to the wants and needs of our employeesAmazon’s culture and business model are based on rapid innovation, flexibility and open lines of direct communication between managers and associates.”

In light of working conditions that subjected warehouse workers to inhumane conditions — warehouses lacking air conditioning, workers not allowed bathroom breaks forced to urinate in bottles or wear Depends, expected to walk 15 miles per day wearing electronic monitoring devices — Amazon’s “open lines of communication between managers and associates” wasn’t the answer. Amazon’s worker-unfriendly environment took another hit when the website Gizmodo published excerpts from a training video for Whole Foods managers that included tips on identifying and “dissuading” employees agitating for a union.

Imagine the scene: the wealthiest man in the world worth around $160 billion sitting with a reporter and all but canonizing himself —“You can offer competitive wages or you can decide to lead and as soon as we framed it that way: let’s decide to lead…” Right on brother! Of course, he left out a few salient details, like how his long-term workers who may already be making $15 an hour will see an increase of a measly $1.00 (bowing to public pressure Amazon raised the hourly wage increase to the more munificent $1.25).

Money Money Money

Then there’s the little matter of where Amazon plans to find the money to fund their “generosity.”  A logical guess would be from the $178 billion in sales revenues in 2017 (one-third increase over 2016) including $5.6 billion in profits with zero income tax paid.  Guess again. Throwing good money after bad on “replaceable parts” like workers offended the chief’s sensibilities. Expanding his kingdom by plunking down $13.7 billion to buy Whole Foods didn’t. Not wasting money improving the lives of other people coupled with unremitting greed probably explain why one of the best performing stocks of the internet age has never issued a dividend. Where better to put Amazon’s yearly windfall than into self-enrichment, bonuses to top executives, and corporate take-overs.  How about workers? What they get is the short end of the stick

For Bezos, the tricky business of making it appear that workers are getting a pay raise devolved into “What one hand gives, the other takes away.”  In this case, the advertised hike to a $15 minimum wage has its dark side, falling squarely on long-term workers. Before Amazon’s bold move, these workers were able to survive by relying on two supplemental benefits: cash bonuses for attendance and productivity and stock awards. Not anymore. Missing from the  wage increase hype was how Amazon intended to pay for it. Bye-bye to bonuses and stock awards (Amazon stock is currently worth about $1,500 per share). Now hourly workers who are able to endure the rigors of five (that’s right five) years in an Amazon fulfillment center might be in line for a $1,500 bonus. Unless of course, the endlessly inventive Bezos decides to “lead again” and changes the rules, maybe around the fourth year when the prospect of giving away all that money to loyal employees proves too much to bear.

How does Amazon get around the inconvenient fact that its generosity is less —much less—than it appears. On the theory that saying makes it so, Amazon delivers this whopper— “We can confirm that all hourly Operations and Customer Service employees will see an increase in their total compensation…[the] higher hourly wage more than compensates for the phase out of stock and incentive bonuses.

 Yes, indeed, notice how Amazon sands the rough edges of this heartless tactic. They’re not eliminating benefits, just phasing them out. No doubt about it, business as usual in the exceptional nation. Corporate heads all over America, who wished they’d come up with this brilliant concept, are busy hatching their own plans for a similar scam.

What is the verdict from Washington’s Mount Olympus, meeting place of U.S. political heavyweights? Here’s Bernie Sanders waxing eloquent—“What Mr. Bezos has done today is not only enormously important for Amazon’s hundreds of thousands of employees, it could well be, and I think it will be, a shot heard around the world.” A little later when he determined that the “wage hike” might not be the best thing since sliced bread, the “shot heard around the world” was reduced to this lame excuse for a scolding — “I would hope that…no worker, especially long-time employees, sees a reduction in total compensation. Amazon can afford to make all workers whole and should do that.”

Effect of this defanged critique? Amazon sticks to its fairy tale that all is peachy in Amazon-land. The corporate media, owned now by six oligarchs, immediately recognizes a race to the bottom when it came to appeasing their own disgruntled workers and are delighted to broadcast what appears to be numerous examples of jubilant, cheering workers. Whether it was a staged demonstration, repeated on a loop, or a real outpouring of glee, Amazon won the perception game hands down.

Podium platitudes from hopeful candidates in the U.S. election sweepstakes aside, how grateful do Amazon workers feel? Here are some of their printable comments: “it’s not a pay raise. It’s a slap in the face.” Another economically astute worker pinned the tail on the donkey: “It seems like the same pile of money. They’re just moving it around.” For another employee, “[it’s as though Amazon is saying] Thanks we appreciate you going into the holidays. Here’s less money.” One Whole Foods worker told it like it is: “They’re squeezing all they can out of workers.”

Whole Foods

How much longer is public opinion going to land on the side of corporate plunderers like Jeff Bezos? He may be the most recent example but corporate predators masquerading as CEOs fill executive suites at virtually all U.S. corporations. What he and his cronies are selling is a variation on the shell game where the “mark” (victim) always loses. For Amazon it’s become a management tool. While Bezos directs the attention of the “marks” (Amazon workers) in one direction (meager minimum wage hikes), he is surreptitiously cutting the earnings of his most loyal employees.

Speaking of income inequality— how absurd is it that eight men (six of them Americans) are as wealthy as half the world’s population? America’s reverence for these billionaires and their evil spawn knows no bounds. The $160 billion-dollar man “rewards” 250,000 workers with an illusory wage hike and gets lionized. It’s a stupendous con and the media and politicians are eating it up. Look for other corporate moguls to do their own end run around a living wage. Don’t we all lose when greed becomes the business model for corporate America? “No society can…be flourishing and happy of which the far greater part of the members are poor and miserable.” (Adam Smith, 1776)

Will U.S. leaders wake up to this heartbreaking reality before it’s too late? What do you think?

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