One of the most insidious, counterproductive, and also pervasive ideas in our thriving culture of victimhood is the fallacy of corporate slavery. Adherents to this ideology insist that corporations are the modern-day near-equivalent of antebellum plantations. They argue that corporations are exploiting their employees, sapping their lives and health, and stealing their freedom. You hear about corporate slavery so much, you might even start to believe it, but it’s just not true.
I generally spend my Twitter time in the personal finance realm. Last week I got sucked into the politics side. That’s easy to do, because along with personal finance and beekeeping, politics and economics are some of my favorite subjects of study and discussion. I usually try to stay out of politics on social media, because, let’s face it, political social media is rancorous collection of ideological echo chambers that produce nothing but pointless yelling and vitriol whenever opposing ideas converge. Nobody walks away from these “discussions” any happier or more intelligent.
I think personal finance social media is different. I have learned a lot from those associations, and I hope you have too.
Unfortunately, politics do influence our personal finances. Politics also drive culture. And culture can have a huge effect on our personal finances. Unfortunately, if we want to be responsibly engaged in our own personal finance, we are going to bump up against culture and politics from time to time. And so it is that I reluctantly rise in defense of corporations and the 9-5 career.
My Story
I spent nearly 20 years in “slavery” to two giant global corporations, first Intel and then Nike. Both of these companies were/are the biggest players in their respective industries by far, so I would assume that they are also the most competitive, greedy, evil, players in those industries.
I’m not going to say that I loved every one of the ten million minutes I spent employed by these companies. Nor will I say that there weren’t plenty of other things I might have preferred to do with those best years of my life. In fact, I often had some real struggles. I have even written about the deep frustration I felt as a result of being repeatedly passed over for promotion while working my butt off for more than 16 years.
Working for Myself
But, let’s use a little comparison to gain perspective. Before I worked at Nike, I started my own footwear company. It was not an evil corporation. It was just myself and a few friends. Working out of my parent’s garage, we designed and built hundreds of pairs of shoes over a period of about 3 years.
If we hadn’t all decided to head off to college, we might have even made a profit in the next year or two. This was not a full-time endeavor, but I was serious about building this business. Even so, I actually lost money.
Working as a Slave
At Nike, I did a job similar to what I had been doing at my own company. I wasn’t actually stitching and cutting, but I was managing the process of developing new products and preparing them to be mass-produced. The products I developed represented about $500 million of revenue for Nike each year. In return for my labor, Nike paid me $100k, or 0.02% of that revenue.
No, that may not sound fair, but remember that my $100k salary from Nike was $100k more than I was earning doing similar work at my own company.
Capitalism is Evil?
People hear stories like mine, see the numbers, do some quick, emotionally-driven math and determine that the corporation is exploiting its employees. If this were true, then why wouldn’t the employees simply leave?
My own experience is a perfect explanation. Working for myself, I was able to produce maybe 100 pairs of shoes a year. At $50 a piece, even if I had no expenses, I might hope to earn just $5,000. This is where we see the amazing power of capitalism. Nike was able to magnify my labor by the capital it has invested in production, advertising, logistics, retail, and so forth. The value produced by my labor and magnified by Nike’s capital was far greater than the value I could ever have produced on my own.
You may want to go back and read this article, where I tell the story of watching people carry buckets of water for hours, back and forth, up the steep banks of the Volga River to irrigate their gardens. The same work could have been accomplished effortlessly for years, saving thousands of man-hours, with $200 worth of pumping equipment. This is another great example of how capital can have a huge multiplier effect on labor and value creation.
Exploitation
But isn’t it exploitation to take so much from the employee and give them so little in return? Nope. I entered into employment with Nike fully aware of the compensation arrangement. I knew what salary and benefits I would receive and what work would be expected of me. Even if I became dissatisfied with the arrangement, I could have ended the relationship at any time. And Nike would have had no trouble finding countless others who would be more than willing to take my place.
Furthermore, It’s easy to twist numbers (as I have done above) to make them tell whatever story you want. Cherry-picking and comparing numbers does not make a story true, even if it does make it believable, or emotionally persuasive. The truth is that the value I produced at Nike was nowhere near that half billion dollars I said I was responsible for earlier. Although my work was directly involved, even necessary, to the generation of that revenue, thousands of other people from production and engineering to sales and distribution were also required to generate that half billion dollars.
A more accurate way to tell the story is that I worked on projects worth a half billion dollars in revenue each year. Thousands of other people participated, and we all received compensation at a level that we willingly agreed to. In fact, you might say that each of us chose to work for Nike, because Nike presented the best opportunity we could find. This revenue supported thousands of families. It also provided the funds to invest in further building the business, thus providing jobs to even more families as time progressed.
And yes, this revenue also paid the dividends of those who own Nike, including its mega-billionaire founder as well as myself.
That’s Right; I Own Nike
Keep in mind that with each paycheck I received from Nike for 19 years, I purchased a tiny fraction of Nike’s capital – their stock. Now, I own 1/500,000th of the company. This means that I own a portion of the company representing sales of about 800 pairs of shoes, plus apparel and equipment, each year.
My piece of Nike’s capital magnifies the work done by each of Nike’s employees. Because I own the capital, I am entitled to some of the value it generates. I receive this as a dividend of around $4k each year.
But Nike also reinvests some of the value it generates back into the business. This means that the company, and my portion of it, is worth more and more each year. Millions of people recognize that growth in value and are willing to pay ever-increasing prices to buy for the stock.
For several years now, this increase in the value of my stock has eclipsed my living expenses. So, I guess you could say that I have become one of those evil corporate masters sucking the blood of those poor corporate slaves. At least that’s how the corporate slavery fear mongers would tell it. But, that simply doesn’t make any sense. A slave doesn’t earn his own money, certainly not enough to buy the plantation as I have done.
Mutually Beneficial Relationship
And that really demonstrates the fallacy of the corporate slavery. A corporation offers at-will employment. The relationship is mutually beneficial to the employees and the corporation. Employees are also free buy into the ownership of the corporation. Many corporations even encourage ownership through programs that allow employees to buy stock at a discount, or simply receive stock as part of their total compensation package. Those greedy corporate masters are so sneaky. They have figured out that the company will thrive when the slaves learn that acting in the company’s favor is the same as acting in their own favor. Pure evil – sarcasm.
Rich People Are Not Your Enemy
As long as we are approaching the topic of equality and fairness. Rich people are not your enemy. Humans have a tendency to believe that if one person has more than another, then the one who has more must have taken advantage of the one who has less. This is not true. We are all different. We have different talents and abilities. The only way to achieve equality is to restrict people from improving themselves and the world around them.
People (especially in a free market) tend to earn in proportion to the value they generate. Mega-billionaires, like the founder of Nike, tend to be people who developed amazingly valuable ideas into business that billions of people choose to buy products from. People choose these products, because they make their lives better.
I’m in favor of better living, so if somebody has an idea or product that will make life better, I say we pay them whatever the idea is worth – even if that’s an obscene amount that nobody will ever be able to spend. Limiting rewards is a recipe for limited innovation and progress.
It’s Not Slavery
In spite of the narrativge, everybody knows that the modern corporate work environment is nothing like slavery. To make the comparison is unfair, and it belittles the real evil of actual slavery. The modern corporate worker labors in a climate controlled building, receives fair wages along with a plethora of other benefits, and has access to an entire HR department, who will listen to his every complaint. There are no whips or chains, and the corporate employee is free to rise as high as his skills, mind, and abilities will take him, or sell his labor to a higher bidder.
Moreover, a 9-5 job at a big corporation provides more than enough to maintain a very comfortable life and provide the funds to set the average person up for retirement after a short 20 years of work.
This is not to say that it’s not hard work. But, hard work is not the same as slavery, especially when you have the freedom not to do it. Having to show up on time every day and do what your manager wants is not slavery, but it is what you are paid for.
So stop complaining that you have to work. That’s life. Life takes a lot of work.
And, you’re not a victim either – except maybe to your own self-imposed limitations. Stop feeling oppressed. There has never been a time in the history of the world when wealth was more easily attainable by more people than it is right now. Take this opportunity to build your own perpetual money machine. Then you can choose to do whatever work you want, when you want, or not at all.
What Do You Think?
If anything in this article struck a nerve with you, please leave a comment.
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