Can They Do That?

You would think that a workers rights advocate would applaud a show like Undercover Boss, where the company investigates employee abuse and takes strong action to stop it.

But I don’t.  Undercover boss perpetuates the fantasy that employers are good people who care about employees and would do the right thing if they only knew what was really going on.

The truth is that any competent manager can easily find out about what’s happening at the operating level.  All you have to do is set up a system where employees can complain without fear of retaliation and have reason to believe top management will take action on legitimate complaints.  A company that has such a system doesn’t need cheap gimmicks like Undercover Boss to learn the truth.

But it’s worse.  Senior management is not only aware of the abuses, they are responsible for most of them.  The decision to fire employees who try to talk about a union comes from the executive suite.  So does the decision to pay compensation that doesn’t keep up with inflation while cutting benefits like health care and pensions.  And who is sending all those evening and weekend messages that disrupt our diminishing time with out families?

Solving the problems of working in corporate American today won’t be easy.  Overseas competition puts enourmous pressure on employers to increase productivity and reduce costs.  So do investors, both large and small, who dump a company’s stock if profits aren’t high enough.

But real solutions start from an honest recognition of the problem, not from fairy tales.  If the producers of Undercover Boss want to know what the real problems are, I’ll be happy to tell them, as will many other people who spend their lives studying the issue.  But I’m not holding my breath waiting for the phone to ring.

Free speech advocates around the world denounced yesterday’s decision by an Italian court to convict three Google executives of violating privacy laws.

As many others have pointed out, if Google (and other ISPs) are legally responsible for the content of materials that are posted, they will begin to censor.  This is not alarmism, it’s a fact.  Corporations are in business to make money.  If Google has to censor content to avoid liability judgements, it will censor.

The censorship won’t be mild.  Corporate lawyers are very risk averse.  (Trust me, I used to be one myself.)  Their job is to keep the company out of legal trouble.  If they succeed, the CEO is happy.   He doesn’t ask whether the company went too far to avoid trouble.  But if the company gets into legal trouble, the attorney may lose his or her job.  From the lawyer’s perspective, the smart thing to do is play it safe.  In Google’s case, this means censor anything that could possibly result in liability.

If this sounds like the death of Internet free speech, it is.  The greatest vehicle for uncensored free expression in human history will have been muzzled.  The fact that the court apparently acted to protect prime minister Burlusconi’s commercial interests only makes it worse.

But Google asked for it.  To keep from losing a business opportunity in China, Google cooperated with the government.  It installed filters and censored attempted postings critical of the Chinese government.

Now Google wants to argue, “we don’t control content, we’ve just a bulletin board”.  That used to be true, but it isn’t anymore.  When Google sold out to the Chinese government, they shot themselves in the foot, and shot freedom of expression too.

If Google wants to avoid responsibility for the content of posted material, it needs to keep its hands off content.  Not just some of the time, but all the time.  They can’t have it both ways.  If they keep trying to, Google and free speech will never be the same again.

1984 is Here; Government Cameras in you Bedroom

The most frightening scene is George Orwell’s 1984 occurs when Winston Smith discovers a hidden camera in his home.  Big Brother has been secretly spying on everything he does and says in his own home.

Even the most extreme privacy advocates didn’t expect this to happen.  We feared the proliferation of cameras in the workplace, including locker rooms and bathrooms.  We were concerned that computer surveillance was spreading from workplace computers to home computers.  Bit none of us thought the government was about to spy on people in their homes.

Sometimes the paranoids are right.  In suburban Philadelphia, the Lower Merion school district has been caught red-handed secretly turning on the webcams in the laptops issued to students.  Most of these computers were in the students’ homes.  Many were in bedrooms.

The school district claims that it was looking for laptops that had disappeared.  Maybe that’s true; maybe it isn’t.  But it doesn’t matter.  This is America; you’re not supported to put hidden cameras in peoples’ bedrooms.  These educators obviously need some educating themselves.

The good news is that the FBI is investigating.  The bad news is that the school officials may not have done anything illegal.  Federal law generally prohibits secretly recording other people’s conversations.  But there is no federal law against secretly taking someone’s picture, even in a private home.  Some states have laws on this subject.  Others do not.

The current federal privacy law was written in 1986.  It doesn’t cover webcams, e-mail, Internet use, IMs, or most other modern forms of communications technology.  Privacy advocates, including me, have been telling Congress for years that they needed to update the law.  Maybe now Congress will do something.

Payday:

Glad you liked the book.  A new post is coming tomorrow about a school that gave the students laptops equipped with video and used them to spy on the students in their homes.

TWO CHEERS FOR HIGH EXECUTIVE PAY

Everyone seems to agree that executive pay is a scandal, from Naderites to frustrated stockholders.  Even President Obama is starting to get in on the act.

But there’s nothing wrong with multi-million dollar executive compensation.  Kobe Bryant was paid $ 23 million last year.  Does Bryant deserve that much money for throwing a ball through a hoop?  It’s a pointless question; you might as well ask how many angels can dance on the head of a pin.  The Lakers pay Bryant$23 million because he makes even more for the owners by filling the Los Angeles coliseum and increasing the Lakers’ television revenue.  To them he’s worth it.

Some executives are worth the astronomical salaries they are paid.  Bill Gates made billions, but he made his stockholders rich too.  Ask the shareholders of Microsoft if they want to get rid of Gates and bring in a new president who will work for less.  If the president of a company with $1 billion in sales (not that much these days) increases profits by 1% (say from 8% to 9%), she will have made the shareholders $10 million.  If I were a shareholder, I’d gladly pay her $5 million a year.

The problem is that some executives get huge salaries that the owners don’t want to give them.  The worst case concerns the post-crash pay of financial executives.  Just over a year ago, they were standing with hats in hand before Congress, asking the taxpayers to save them.  The value of their companies had fallen off the charts because they were facing bankruptcy.  For the billions that taxpayers poured into these risky companies, we should have become the majority shareholders.  Then we would be able to pay these executives what the current performance justifies.

Instead, the taxpayers took all the risk and got little more in return that the hopes of getting paid back some day.  Now the banks pay back the loan and are free to pay themselves almost anything they want.

President Obama saved the country from another great depression, but he let the banks put one over on him- and us.

There are many legitimate questions in the debate about health care reform.  Is single payer the right answer?  Do we need a public option?  How much can we afford to spend?  The list is endless.

The one question about which there is no legitimate debate is the need for health care reform.

The era of employer provided health insurance in coming to an end.  Unless we create a new model, even Americans with good jobs will have no access to medical care.

There is no compelling reason to provide health care through employment.  Most industrial countries do it differently.  The fact that Americans get health insurance through their work is an accidental outgrowth of our tax laws.  If your employer pays you $1,000 in cash, it’s taxable income.  If your employer spends $1,000 on health insurance for you, it isn’t taxable.  Employers can pay higher compensation at no extra cost by putting part of our pay in the form of insurance.

This model worked reasonable well since we started turning to it in the 1970s.  But it only worked well because three conditions existed.

Ability to Pay

Years ago, American industry stood alone at the top of the world economy.  Companies in most other countries had neither the capital, the infrastructure, nor the level of employee education to compete with us.  Because we had little competition, American companies were able to pay well.  The biggest issue between employers and employees at that time was, “how big a raise am I going to get?”

These days are over forever.  Global competition from formerly economically backward countries like China and India have put unending pressure on American employers to cut costs, especially labor costs.  It’s difficult to pay autoworkers $20 an hour when equally skilled workers in Korea will work for less than half as much.

Employers have responded by cutting compensation, especially health insurance.

Full Employment

For employment based health care to work, it is also necessary for most people to hare jobs.  Not long ago, unemployment was about 4%.  Now it is twice as high.  And if we counted the people who want to work but have given up looking for a job, the rate would be even higher.

Unknown Medical Future

For most of human history, it has generally been a mystery who would get sick in the future.  This is no longer true.  Modern medical technology, especially genetics, enables us to determine much more accurately who will become ill.  This gives employers financial incentives not to hire people who carry the genes linked to breast cancer, Alzheimer’s, and other serious diseases.

Results

These factors have combined to dramatically reduce the number of employers that provide health insurance.  The percentage of employers providing health insurance has decrease steadily for over a decade.  Since 1996, the percentage of employers offering health insurance has declined from 70% to 58%, leaving millions of full-time employees without health insurance.  Virtually every expert in the field expects it to continue to decline.

In addition, even employers that still provide insurance have cut back on coverage and increased employee co-pays.

Unless we find an alternative way to provide medical insurance, it won’t be long before the majority of American employees have to fend for themselves at a time when the cost of medical care continues to rise.