CEO says:
In summer 2021, he says, “we were 40,000 package-handlers short, and there were people in the media saying that the stimulus checks didn’t have anything to do with that.” Such people are “divorced from the world we’re living in.” FedEx made up the shortfall by December: “It took a lot of effort.” Mr. Smith concedes that large numbers of people may simply have decided not to work for fear of the pandemic. But “if I’m getting a government check,” he says, there’s less incentive to “go into a warehouse.”
for the average worker:
15 per hour average FedEX package handler salary - from another source on the shipping industry “They underpay everyone. The cost per package is literally .12 to .40 cents and we’re paying people $50.00 to unload four 45ft. trailers in 3.5 hours.”
making a company a success by shortchanging the little guy is the American Way.. the American public is fine getting their crap delivered fast..as long as its cheap right
This is pretty much why 1/5 of packages I'm getting via FedEx Ground are smashed or damaged. They aren't even supposed to be "overnight" and mishandling is rife.
FYI FedEx ground is a separate company. They are actually locally owned / individually owned franchises that pay FedEx to route and ship their packages. The routes are owned by individuals. Its a great biz as many are making very good livings managing the routes.
Yeah Fedex is a "you get what you pay for" company. They bid low and underdeliver.
The problem they have is that geography drives the business, and their hubs are usually near competing hubs for UPS. They must have made a policy decision to not get into a price war re: wages with UPS.
My guess is that Amazon's logistics buildout is hurting them more than UPS.
If you're curious how that was solved, it certainly wasn't stimulus or unemployment running out. It was FedEx increasing starting pay rate 30-40% overnight, bringing them near parity with competitors.
The good news is that people like this CEO are pissed off because things have changed. Welcome to America Mr. CEO, where I can sit on my ass until you pay me enough that I fell like working for you.
You don't like it? Well you can set an example and you can start working for $9/hour.
>The massive labor shortage that’s rocked the U.S. since the pandemic and disrupted long-established employment relationships hasn’t had much impact on UPS, which pays its unionized drivers the highest wages in the industry. That’s helped it maintain a stable workforce and rising profits throughout the current disruptions. Meanwhile, lower-paying, nonunionized FedEx racked up $450 million in extra costs because of labor shortages. And while UPS easily beat earnings expectations and predicted a rising profit margin in the U.S. for the fourth quarter, FedEx signaled that its profit margin will fall further.
I couldn't read this. Company he founded to save the world--literally? Largest transportation network ever built, what?
And like his image drawn in to make him look 43 but with white hair, and a bunch of airplane tails?
Fellatory news article.
> In March 2020, at age 75, Fred Smith should have been winding down his legendary career as CEO of FedEx. Then Covid-19 hit, everyone’s life turned upside down, and the company he founded had to save the world—“literally,” he says, with no small amount of passion.
Like what? Is he a hero? A Roman Law hero?
> “We, and UPS, and to a lesser degree the Postal Service and a company called DHL, literally kept the world operating,” Mr. Smith declares. “I don’t think that what our people did is understood or appreciated nearly to the extent it should be.”
A lot of those communications went digital, in fact, that's the con going on here. Digital communications took over to a huge degree, so his company is doing worse, so that's why he's paying for a fellatory article on the wall street journal blog, he wants to create buzz around his company.
560,000 employees in 220 countries? I thought it was 190 countries, what the fuck? He doesn't have 560,000 employees either.
I don’t think package handling business is down? First class mail is down which is bad for USPS, but e-commerce is up every year which is good for UPS and Fedex (though Amazon e-commerce is mostly using their own network so not really part of the equation )
I have to stop you right there, I have received spam in the mail and I am somebody and I did like receiving some of it. The California magazines...good paper, sure they're marketed to women, but get this no rapey cookie "consent" contract, like those are just disgusting I hate getting asked for consent it means I'm about to get fucked. Every single time you get asked for consent it's because you're about to get fucked. That's fine for a once-in-a-lifetime thing like a marriage contract, OK then I understand giving consent to getting fucked, by my future wife, perfectly understandable and good that there's a contract. But for clicking on a link in a forum? So that's why I liked those magazines, yeah they were trying to distort your sense of a good price by showing prices inflated by two orders of magnitude but at least they didn't target accurately. That's good, I don't want accurate targeting on advertisement aimed at me any more than I want accurate targeting on pistols aimed at me.
Oh you're right about that, ecommerce picked up a lot. I was thinking about documents. Well I'm wrong sometimes, I accept that. Ecommerce, didn't think of that.
Interesting interview. He is yet another extremely wealthy man, who built his fortune on the back of Government that now claims that government is the problem... Very few businesses are as subsidized as air travel. Fed Ex could not / would not exist without the government aide it is provided. Air traffic control, airports, etc.
This toxic hubris is a big part of what is wrong with our society. These men no longer look at their fortune as a series of lucky breaks, good timing and countless hands-up by others and their government. Things that are only possible in a society that paves the way ahead of them... Instead they think they and they alone are the reason that they're successful.
The fact is that everyone "stands on the shoulders of giants".
It seems that the concept of giving back and paying forward is absent in these men. Instead, they believe they're special and anoiteted by God to drive us in a particular direction. What a change from the 19th century Robber Barrens who gifted us institutions and built the very foundation of a reasoned society (schools, libraries, research institutions etc..). Today? We get personal rockets, politically motivated think tanks and awful narcissistic ideologues who want to rule over us...
For every Gates, there are a dozen Zucks masquerading as royalty and proving that absolute power (money) absolutely corrupts.
It's a classic "great man of history" narrative, painting a Randian picture of the world being pushed forward by the overwhelming efforts of a few people. The reality is that nobody works hard enough to earn a billion dollars - that amount of money can only be made by short-changing the people who do the work.
If a founder starts a company, a company that builds a very helpful product and service, hires employees and pays them creating jobs and ways for them to work on interesting problems, I am not trying to defend the other side of your point, I just honestly don't see where the "exploitation" comes into play?
At it's core, capitalism is about maximally exploiting labor.
Some companies treat their employees better (Costco) or worse (Walmart), but at the end of the day it's all a byproduct of the structure and behaviors rewarded in capitalism.
The "winners" exploit the hardest, otherwise potential profits are being left on the table and it opens an opportunity for another company (who is willing to go the extra mile to exploit harder) to enter and offer lower prices. Subsequently, the working middle class and poor people (the largest segments of USA population) have their own harsh realities to deal with, and don't have the luxury of choosing more humane yet expensive alternatives when they are purchasing goods and services.
Obviously poverty is a major issue, and as a society we can and should be doing a lot more to address structural inequality. However, is there a time or place in history when/where would be better to be poor than today in a modern day first-world capitalist country? To be clear, I'm not arguing that we're anywhere near an ideal or perfect state for this, but what are the alternatives that you see?
And who here thinks the way Amazon warehouse employees are treated is a good thing? Drivers, too. Peeing in bottles. 14 hr shifts. Buffer companies between Amazon and the customer, so they can easily skirt labor laws, etc.
I'm open to being wrong, but can you elaborate on what sorts of real value can be created through means other than labor? In my experience, not much happens in life unless someone puts in the elbow grease.
To take a minimal case for an example - if I hire two people, pay them $20,000 each to produce widgets and then sell those widgets for $100,000 a year respectively, and keep the remaining $60,000, would you consider that exploitation considering that I contribute nothing to the continued economic activity? This is the form of exploitation I was referring to.
For a contrasting example, I prefer cooperatives where the people involved in the business control it democratically (which can still include directors and managers).
Again, I am not trying to to defend the counter but am I missing something or is there quit a large logical gap in your hypothetical?
I assume if I am doing the hiring, then I will also be responsible for the additional hiring/firing, selecting the right talent, choosing the right way to compete against existing product/services? Is that not continued activity as I grow my start-up into a category-defining enterprise? How to allocate that profit, into R&D, more people, sales, etc, aka growing a company?
Then after doing that for 10 years that company is now worth billions of dollars and I own it. I don't see where in this chain I have done the exploiting?
So what you're describing is the work of a director - work that should be paid but that I intentionally excluded from my example because a lot of people just think by default that directors should "own" the company because that's the status quo.
I still think that directors should be well compensated commensurate with their capability and role. I just think that they shouldn't be able to exclusively control and take the profits generated by the work of everybody involved. Corporations are autocratic or oligarchic in that way - this leads to the select few that society seems worthy of profit control having more power in our society. This is because the owners can keep workers' wages as low as the market will sustain while inflating their own total compensation to absurd proportions, as we've seen. With a cooperative structure everybody involved has a stake in controlling the company, so executives have to take everybody's needs including the workers, into account, instead of just looking out for themselves and investors.
As for where the exploitation comes in - it probably comes down to different perspectives on the word. To me, it's exploitation if one person is profiting off the labour of another. Of course in a company the shareholders are often also working, but if a company grows to a billion dollars from a million its not because the directors are working 100x harder.
A founder-operator has two roles in the company - as owner, being the founder and thus a shareholder, and as director or whatever work role they have. I only take issue with the former part as I think people should have a say in how the company they are a part of is run. Directorship is still a skilled job that should be compensated thusly.
I think that an organisation is just a group of people and just like in our countries, we should be able to make our voices heard democratically. I think we should aim to make more areas of our lives democratic, including our workplaces where we spend much of our lives.
So yeah, I think you should have a voice in how the company you work for is run.
I think voting with your feet only works in theory, because Amazon is well known to engage in abusive employment practices (including according to workers) and yet has a great number of warehouse and delivery staff and its founder is the second (?) richest man on earth. Many low paying jobs have high turnover rates because they can just use people up until they quit (if they even have that option) and then bring in an unemployed person. They have to incentive to treat their employees with decency.
Do you consider it exploitation when someone voluntarily takes the $20,000 job? Is it exploitation when the person who risked the money to start the business loses it all and goes bankrupt?
How is providing the two jobs not contributing to the economy?
How do you clear $60,000 on widgets? What about the costs of supplies, insurance, compliance to government regulations, city/state/county/federal taxes, import duties,R&D, documentation, advertising, and so on?
Exploitation isn't when somebody is forced to do something, it's when one person profits off the work of another. So in my example, the job is exploitative, yes. Having a business fail is not exploitation.
I didn't make an argument about whether it was contributing to the economy or not, but that doesn't matter - slavery contributed to the economy too, but it's also morally wrong.
It's a stripped down hypothetical on purpose, to get to the heart of the question. Non-labour material concerns are left as an exercise for the reader.
I am borrowing the shareholders’ big investment to amplify the value of my own work. I’m not taking any risk and I’m not paying them, instead they are paying me more than I could earn without them.
Do you think founders should retain ownership of the companies they create?
Fred Smith’s wealth comes from the notional value of his ownership of a small fraction of an enormously successful and societally useful business. It’s not as if he has a bank account with billions of dollars in profits paid as salary in it, which you seem to believe.
On what basis do you think he should have been compelled to sell his stake in the company he created?
Yes, you’re correct that he didn’t earn a billion dollars. He created a company that investors value at $60B, and his remaining 6% share of it is worth $4B. That $60B was not taken from anyone. It was created - out of thin air - by organizing workers in a way that the world needed.
> Do you think founders should retain ownership of the companies they create?
No. The idea that a company is something you "own" rather than a group of people doing some kind of economic activity is a social construct, and one designed to disenfranchise the people doing the ongoing work. A company is a collection of assets and people - to own assets makes sense, to own other people's labour in an ongoing capacity does not.
> On what basis do you think he should have been compelled to sell his stake in the company he created?
I don't think he should - I think we should change the system that allows people to be worth billions off the backs of others. I don't want redistribution, I want reform.
So, FedEx owns a bunch of airplanes. Billions and billions of dollars worth of airplanes. Who bought them? The owners bought them. So you have three options:
1. The owners get some property rights ("ownership") for the money they put up to buy the airplanes and related other tools. Or,
2. When an employee is hired by FedEx, they have to come up with... something of the order of $60 billion / 100,000 employees, to pay your share of the enterprise you are becoming part of. Or,
3. We as a society don't have any capital-intensive companies. Who's going to buy the tools, if the one putting up the money doesn't get ownership? (And don't say "government". Government running private enterprise almost always winds up with too much mismanagement and graft.)
These are valid concerns to raise, but can be addressed. In actuality, the investors (which can also be the owners but not necessarily) provide the company with capital to purchase these planes. That, or the company uses its own profits to do so. Either way, the money is the property of the company, not the owners.
In the former (investor) case the payment can be structured as a loan, and/or investors can become stakeholders as part of a multi-stakeholder cooperative, with their own cut of the earnings. In the latter case it's no issue because the company is buying things with its own resources.
Depends on who you ask - I'm fine with it and haven't said otherwise. What is a problem is when one person profits off the work of another (as in, pays them less than their fair share), which is basically all salaried employment.
If the co-op is sold at a profit, and those profits are distributed to the workers (who obviously all put in the exact same amount of work and time, right?) then they are profiting off the work of others, aren't they?
For starters, not everybody in a coop has to earn the same amount or get the same payouut from a sale. They just all need voting rights. The point of cooperatives is to be owned by all their members, not just the founders.
Second, yes the profit in the marketplace is still exploitative to a degree, but we don't have a viable alternative so there's not much to do about that. I don't believe there's much point critiquing something when there's no alternative.
I don't even want their 'charity,' I just want systems in place to prevent anyone from accumulating that amount of wealth in the first place. First, the basis of philanthropy is to have all the 'normals' grovel at the feet of the all-mighty wealthy begging for handouts. It stokes the wealthy persons ego and also gives them additional power. Second, there's no reason to believe that the wealthy philanthropist has any better idea of how to deploy their capital than the other institutions that would otherwise. Look at Gates, for example. He spent a decade or so and billions of dollars reshaping US public education and at the end of it basically admitted complete failure. That money should have never been his to direct in the first place. So no, we should want their greed exposed and not papered over by philanthropy so that the public eventually realizes that people accumulating and hoarding that much wealth is damaging to society and enact appropriate taxation schemes to claw back what they have stolen and prevent anyone else from ever doing it again.
I think one really good feature of Western capitalism is that the corporate sphere provides greedy sociopaths with an escape valve before they turn the path of Hitler, Putin, Stalin, etc. As hard it is to stand and watch these folks get rich on the backs of little people, it is still preferable to them climbing the military dictatorship ladder.
Sorry I don’t see that answer in the linked article, which is about antitrust, not “hoarding wealth”. Since it’s been answered time and again could you just quote the part that answers my question?
I am asking about this passage:
> So no, we should want their greed exposed and not papered over by philanthropy so that the public eventually realizes that people accumulating and hoarding that much wealth is damaging to society and enact appropriate taxation schemes to claw back what they have stolen and prevent anyone else from ever doing it again.
It states explicitly that people are hoarding wealth and must be punished for it. For example, if your 401(k) is worth half a million dollars and your house is worth $1 million, a person living on $300 a month in a less privileged country might be forgiven for assuming that you should be punished for “hoarding“ wealth.
So I’m trying to understand what number hoarding starts at, and what the punishment should be.
The short answer is that's a political question along the same lines as what should the minimum wage be, or what should the rate of taxation be? There is no one right answer for all times and all situations, and it should be determined through public debate and input via voting. We as a society operate in this manner in all sorts of ways, and it's not at all inconceivable that we could do the same here.
I think the guideposts should be to put limits on how much influence a single person should have in our society, or to limit the amount of influence we unintentionally give one person just by participating in the economy. For example, if I buy a product from a company that has a large advertising spend on Facebook, I am indirectly, perhaps even unknowingly adding to the personal wealth of Facebook's owner just because of some decisions that someone else made. Now the libertarian response to that is to research each and every product you buy, but that quickly becomes an impossible task for any one person to do, much less every person. Not only is the quantity of information too large, but some information is simply inaccessible to the public at large.
So, to answer your question more directly, I can give you my personal opinion. I think capital gains should be taxed the same as regular income, inheritance taxed as regular income, unrealized gains taxed as regular income (above some threshold perhaps), and progressive taxation to asymptotically approach 100%. Right now our top tax bracket ends at 37% at $539,900 income for an individual. It's at 35% for incomes from $215,950 to $539,900. I'd call that roughly a 2% rise for a ~250k rise for back-of-the-envelope calculation purposes. So linearly extrapolating that out, maybe the top tax bracket becomes 100% after somewhere around $10mm annual income. And since you pay taxes on that $10mm, you maybe can accumulate somewhere in the neighborhood of $5mm a year. And that's generous in my opinion, because lower income tax payers pay an 8% increase (24% to 32%) to go from ~$90k to ~$170k, so it's not like its a linear function for workers.
And then how do we 'catch up' on back taxes? You kind of establish a concept of a 'maximum wage' at some point in a progressive taxation scheme that approaches 100%. I think one fair-ish way of doing it would be to cap wealth at that level, so that if the maximum income is let's say $5mm, you can keep $5mm for each working year of your life, anything beyond that being due as back taxes. So if you're 65 you could still have ~$235mm, which seems like plenty to me. And when that person dies, their children's inheritance is taxed as regular income as well and effectively capped at $5mm or so (whatever it turns out to be), so there's little point to dying with hundreds of millions of dollars in the bank.
Maybe not those exact numbers, but somewhere around there seems reasonable to me. But my opinion is just one opinion, and a big change like this should be determined through the political process with inputs from everybody.
I second the "disastrously bad". "Let's all vote on how much money you're allowed to have" is not going to end well.
But a 20% consumption tax isn't the answer. The problem the GP is trying to address is how much the rich have, not how much they spend. The rich spend less of what they have - that's how they stay rich. A spending tax won't touch them.
> The problem the GP is trying to address is how much the rich have, not how much they spend.
I agree. Perhaps we differ on this: How rich someone else is has no bearing on me. In fact, I love it when people get rich.
I'm sure you'll agree that you are wealthy beyond measure to hundreds of millions, maybe billions, of people in the world. They could well be stunned and angry at the way you spend money.
> The rich spend less of what they have - that's how they stay rich.
Not sure I agree. Many people appear to be rich but are actually in over their heads. Look at many, many pro athletes five years out of their careers.
Those 19th century Robber Barons were, some exceptions aside, notably less charitable than most sepia-toned histories makes them out to be. Their 19th century abuses of workers also make almost anything happening in the modern first world look like coddling by comparison.
And back then, mainstream Christian churches were a far more important social institution. Acting as the "generous Christian" was probably far more important to one's standing in "well-born" society.
Not fully. Nor are the air traffic control costs paid by airlines. The entire ATC infrastructure is government run and funded and most of the airports are run by local governments. Very few airports actually make money or are profitable for the agency that runs them. They are subsidized. Done with the idea that they are essential for communities and are a part of our underlying infrastructure.
\
Also: look at what FedEx pays in Fed taxes. Its zero most years.
Airlines aren't the only people who use air traffic control. The military has more than 5x more aircraft than the largest airline in the US (American). And 8x more than Fedex. Then there are all the general aviation aircraft.
Yes air travel is subsidized, and if you look up ground transportation it's even worse. The Fed pays for insanely huge amounts of motor vehicle infrastructure for which ground shippers barely pay a small portion relative to their resource usage and negative externalities.
For clarification, no. I am certain that person met the federal government. The Federal Reserve is a private enterprise (disgustingly) that only takes from the government. It does not give.
I don't understand the negative tone of the comments below. From the article, the story of Fred delivering packages for area tech companies with the Yale flying club is a fascinating startup story. He served two tours in Vietnam with the Marine Corps. He skirted government air cargo regs by flying planes under the size threshold. His board is diverse for Fortune 100 standards. The lead image portrait is his old board picture, stylized, with some planes in the background. He's right that stimulus checks directly caused labor shortages and he increased wages dramatically to make up for it. (yes he should pay all his employees more.. you probably could too.) He's an old guy with old school vocal opinions who has accomplished pretty amazing things. Everyone has their "ugh my package got stomped" anecdote but the physical level of service that Fedex (and UPS and DHL) provides worldwide is a staggering feat.
Another interesting note on Fred Smith, among many on Wikipedia, he inherited $4M dollars and put it all into starting Fedex, creating the $50B company we know today.
Frankly, the negative response to what FedEx is able to pull off reeks of first-world privilege. There's a lot of people who are quick to point fingers and talk about the exploitation of capitalism, but they've never even left the safety and comfort of the functioning country they grew up in to realize how absolutely amazing it is you can even get a package delivered in nearly every corner of the world for a reasonable price. As someone that's traveled around the world and had to ship things at odd times in strange places, I have nothing but admiration for the logistics networks that were built by organizations like FedEx and DHL. As someone who grew up relatively poor in a rural part of the US, I have nothing but admiration for the capabilities of the USPS and their coverage area.
The comments in this thread act like the article is committing the great man fallacy because it's talking about the work the founder put into FedEx. Yet, all of that is (presumably) factually accurate, which doesn't detract from larger systemic points, but certainly shouldn't encourage darts to be lobbed. The only folks who can possibly throw stones here are those who are ignorant of the realities of global logistics. Physical logistics is HARD, significantly harder than any problem the average tech worker has had to deal with in their life of air conditioned offices and ever more powerful systems available to them to solve problems.
I mean, my god, FedEx solved the logistical hurdles of package delivery so thoroughly they were able to put an API on top of it. That's got to be worth at least a little admiration.
> but they've never even left the safety and comfort of the functioning country they grew up in
Bold of you to assume every negative comment is from some ignorant untraveled American.
> As someone who grew up relatively poor in a rural part of the US
Hey, me too! which is doubly annoying considering the thick veneer of condescension in your comment.
Logistics is a hard problem, and fedex has some really interesting stories about that, but don’t come in here and start saying I’m privileged for criticizing the CEO when he’s so out of touch it’s comical.
It is not his success that I find problematic, its his current assessment of the Gov, the politics and the imbalance that exists in today's "Socialize risk, Privatize profits" environment. He's suffering from hubris.
The fact that he comes from money makes this whole thing even more ridiculous. He did not build anything from scratch, he literally started on 3rd base and was handed his field position before he even started...
This also seems to ignore the fact that UPS existed decades before his company, a company that he intentionally named Federal Express to fool people into thinking it was a government entity...
UPS introduced next-day air service in select markets in 1982 and UPS Airlines founded in 1988, Fedex was founded in 1971 with a focus in overnight delivery. He launched his company in the shadow of a juggernaut.
Naming his company- even better, he apparently gave his dozen or so planes random serial numbers to give the impression he had way more planes. Plane #136 coming in!
Starting at 3rd base- this might be said of the Fords or for the Waltons, but Fred did not inherit the business he built. Yes he had a privileged start, but his daddy certainly didn't hand him an air freight business.
I certainly understand not liking his politics. His comments in the article are bristly.
Fred was trained by the US Gov to fly, went to the most exclusive schools and inherited 40million in the 70s! That's 250million today... You can think this is a story of a selfmade man but you'd be wrong. He may have built a business, but he did it from the highest rings of the ladder having been placed there by his privilege.
I work in an industry where over the last two years my employees have respectfully but firmly quit because "I dont need to work right now," my experience in the construction and hospitality management world. It would be nifty to have a non-biased source to give you, but frankly its not necessary. Why show up for work if you have your bases covered with free money from the government. I am in favor of paying my team members more, but I couldn't match the Fed's offer.
Regarding the inheritance, yea its nice, but where is the magical easy button that got him to where he is today. Your comment is sarcastic and not constructive.
He brilliantly navigated the airline deregulation period and built an amazing express company. Yet, he's always whining about the Post Office and Amazon.
One would think that after getting whomped by the ecommerce explosion 20 years ago and scrambling to buy a ground operation he would focus within. As a customer, they seem to be behind the 8-ball with anything outside of that business.
84 comments
[ 3.0 ms ] story [ 162 ms ] threadfor the average worker: 15 per hour average FedEX package handler salary - from another source on the shipping industry “They underpay everyone. The cost per package is literally .12 to .40 cents and we’re paying people $50.00 to unload four 45ft. trailers in 3.5 hours.”
making a company a success by shortchanging the little guy is the American Way.. the American public is fine getting their crap delivered fast..as long as its cheap right
The problem they have is that geography drives the business, and their hubs are usually near competing hubs for UPS. They must have made a policy decision to not get into a price war re: wages with UPS.
My guess is that Amazon's logistics buildout is hurting them more than UPS.
You don't like it? Well you can set an example and you can start working for $9/hour.
https://www.bloomberg.com/news/articles/2021-11-04/labor-sho...
And like his image drawn in to make him look 43 but with white hair, and a bunch of airplane tails?
Fellatory news article.
> In March 2020, at age 75, Fred Smith should have been winding down his legendary career as CEO of FedEx. Then Covid-19 hit, everyone’s life turned upside down, and the company he founded had to save the world—“literally,” he says, with no small amount of passion.
Like what? Is he a hero? A Roman Law hero?
> “We, and UPS, and to a lesser degree the Postal Service and a company called DHL, literally kept the world operating,” Mr. Smith declares. “I don’t think that what our people did is understood or appreciated nearly to the extent it should be.”
A lot of those communications went digital, in fact, that's the con going on here. Digital communications took over to a huge degree, so his company is doing worse, so that's why he's paying for a fellatory article on the wall street journal blog, he wants to create buzz around his company.
560,000 employees in 220 countries? I thought it was 190 countries, what the fuck? He doesn't have 560,000 employees either.
Volume-wise, yes. But also most of the volume handled by USPS is bulk mailers that nobody wants to receive in the first place.
This toxic hubris is a big part of what is wrong with our society. These men no longer look at their fortune as a series of lucky breaks, good timing and countless hands-up by others and their government. Things that are only possible in a society that paves the way ahead of them... Instead they think they and they alone are the reason that they're successful.
The fact is that everyone "stands on the shoulders of giants".
It seems that the concept of giving back and paying forward is absent in these men. Instead, they believe they're special and anoiteted by God to drive us in a particular direction. What a change from the 19th century Robber Barrens who gifted us institutions and built the very foundation of a reasoned society (schools, libraries, research institutions etc..). Today? We get personal rockets, politically motivated think tanks and awful narcissistic ideologues who want to rule over us...
For every Gates, there are a dozen Zucks masquerading as royalty and proving that absolute power (money) absolutely corrupts.
Some companies treat their employees better (Costco) or worse (Walmart), but at the end of the day it's all a byproduct of the structure and behaviors rewarded in capitalism.
The "winners" exploit the hardest, otherwise potential profits are being left on the table and it opens an opportunity for another company (who is willing to go the extra mile to exploit harder) to enter and offer lower prices. Subsequently, the working middle class and poor people (the largest segments of USA population) have their own harsh realities to deal with, and don't have the luxury of choosing more humane yet expensive alternatives when they are purchasing goods and services.
For a contrasting example, I prefer cooperatives where the people involved in the business control it democratically (which can still include directors and managers).
I assume if I am doing the hiring, then I will also be responsible for the additional hiring/firing, selecting the right talent, choosing the right way to compete against existing product/services? Is that not continued activity as I grow my start-up into a category-defining enterprise? How to allocate that profit, into R&D, more people, sales, etc, aka growing a company?
Then after doing that for 10 years that company is now worth billions of dollars and I own it. I don't see where in this chain I have done the exploiting?
I still think that directors should be well compensated commensurate with their capability and role. I just think that they shouldn't be able to exclusively control and take the profits generated by the work of everybody involved. Corporations are autocratic or oligarchic in that way - this leads to the select few that society seems worthy of profit control having more power in our society. This is because the owners can keep workers' wages as low as the market will sustain while inflating their own total compensation to absurd proportions, as we've seen. With a cooperative structure everybody involved has a stake in controlling the company, so executives have to take everybody's needs including the workers, into account, instead of just looking out for themselves and investors.
As for where the exploitation comes in - it probably comes down to different perspectives on the word. To me, it's exploitation if one person is profiting off the labour of another. Of course in a company the shareholders are often also working, but if a company grows to a billion dollars from a million its not because the directors are working 100x harder.
You believe that when you join an organization you automatically have a say in how it is run.
So yeah, I think you should have a voice in how the company you work for is run.
(This of course does not apply to the very disadvantaged)
How is providing the two jobs not contributing to the economy?
How do you clear $60,000 on widgets? What about the costs of supplies, insurance, compliance to government regulations, city/state/county/federal taxes, import duties,R&D, documentation, advertising, and so on?
I didn't make an argument about whether it was contributing to the economy or not, but that doesn't matter - slavery contributed to the economy too, but it's also morally wrong.
It's a stripped down hypothetical on purpose, to get to the heart of the question. Non-labour material concerns are left as an exercise for the reader.
We live in different world. Thank you for your response.
https://dictionary.cambridge.org/dictionary/english/exploita...
> the act of using someone unfairly for your own advantage
But we probably just disagree on the meaning of "unfairly" within that definition.
> one person profits off the work of another
Trade needs to benefit both parties.
Fred Smith’s wealth comes from the notional value of his ownership of a small fraction of an enormously successful and societally useful business. It’s not as if he has a bank account with billions of dollars in profits paid as salary in it, which you seem to believe.
On what basis do you think he should have been compelled to sell his stake in the company he created?
Yes, you’re correct that he didn’t earn a billion dollars. He created a company that investors value at $60B, and his remaining 6% share of it is worth $4B. That $60B was not taken from anyone. It was created - out of thin air - by organizing workers in a way that the world needed.
No. The idea that a company is something you "own" rather than a group of people doing some kind of economic activity is a social construct, and one designed to disenfranchise the people doing the ongoing work. A company is a collection of assets and people - to own assets makes sense, to own other people's labour in an ongoing capacity does not.
> On what basis do you think he should have been compelled to sell his stake in the company he created?
I don't think he should - I think we should change the system that allows people to be worth billions off the backs of others. I don't want redistribution, I want reform.
1. The owners get some property rights ("ownership") for the money they put up to buy the airplanes and related other tools. Or,
2. When an employee is hired by FedEx, they have to come up with... something of the order of $60 billion / 100,000 employees, to pay your share of the enterprise you are becoming part of. Or,
3. We as a society don't have any capital-intensive companies. Who's going to buy the tools, if the one putting up the money doesn't get ownership? (And don't say "government". Government running private enterprise almost always winds up with too much mismanagement and graft.)
In the former (investor) case the payment can be structured as a loan, and/or investors can become stakeholders as part of a multi-stakeholder cooperative, with their own cut of the earnings. In the latter case it's no issue because the company is buying things with its own resources.
Second, yes the profit in the marketplace is still exploitative to a degree, but we don't have a viable alternative so there's not much to do about that. I don't believe there's much point critiquing something when there's no alternative.
Heres sort primer to for anyone that is not up to speed.
https://en.wikipedia.org/wiki/History_of_United_States_antit...
I am asking about this passage:
> So no, we should want their greed exposed and not papered over by philanthropy so that the public eventually realizes that people accumulating and hoarding that much wealth is damaging to society and enact appropriate taxation schemes to claw back what they have stolen and prevent anyone else from ever doing it again.
It states explicitly that people are hoarding wealth and must be punished for it. For example, if your 401(k) is worth half a million dollars and your house is worth $1 million, a person living on $300 a month in a less privileged country might be forgiven for assuming that you should be punished for “hoarding“ wealth.
So I’m trying to understand what number hoarding starts at, and what the punishment should be.
I think the guideposts should be to put limits on how much influence a single person should have in our society, or to limit the amount of influence we unintentionally give one person just by participating in the economy. For example, if I buy a product from a company that has a large advertising spend on Facebook, I am indirectly, perhaps even unknowingly adding to the personal wealth of Facebook's owner just because of some decisions that someone else made. Now the libertarian response to that is to research each and every product you buy, but that quickly becomes an impossible task for any one person to do, much less every person. Not only is the quantity of information too large, but some information is simply inaccessible to the public at large.
So, to answer your question more directly, I can give you my personal opinion. I think capital gains should be taxed the same as regular income, inheritance taxed as regular income, unrealized gains taxed as regular income (above some threshold perhaps), and progressive taxation to asymptotically approach 100%. Right now our top tax bracket ends at 37% at $539,900 income for an individual. It's at 35% for incomes from $215,950 to $539,900. I'd call that roughly a 2% rise for a ~250k rise for back-of-the-envelope calculation purposes. So linearly extrapolating that out, maybe the top tax bracket becomes 100% after somewhere around $10mm annual income. And since you pay taxes on that $10mm, you maybe can accumulate somewhere in the neighborhood of $5mm a year. And that's generous in my opinion, because lower income tax payers pay an 8% increase (24% to 32%) to go from ~$90k to ~$170k, so it's not like its a linear function for workers.
And then how do we 'catch up' on back taxes? You kind of establish a concept of a 'maximum wage' at some point in a progressive taxation scheme that approaches 100%. I think one fair-ish way of doing it would be to cap wealth at that level, so that if the maximum income is let's say $5mm, you can keep $5mm for each working year of your life, anything beyond that being due as back taxes. So if you're 65 you could still have ~$235mm, which seems like plenty to me. And when that person dies, their children's inheritance is taxed as regular income as well and effectively capped at $5mm or so (whatever it turns out to be), so there's little point to dying with hundreds of millions of dollars in the bank.
Maybe not those exact numbers, but somewhere around there seems reasonable to me. But my opinion is just one opinion, and a big change like this should be determined through the political process with inputs from everybody.
I do agree completely agree with the final paragraph.
I’d prefer a simple 20% federal consumption tax on everything we buy, period, and no corporate welfare of any kind.
But a 20% consumption tax isn't the answer. The problem the GP is trying to address is how much the rich have, not how much they spend. The rich spend less of what they have - that's how they stay rich. A spending tax won't touch them.
I agree that corporate welfare needs to go.
I agree. Perhaps we differ on this: How rich someone else is has no bearing on me. In fact, I love it when people get rich.
I'm sure you'll agree that you are wealthy beyond measure to hundreds of millions, maybe billions, of people in the world. They could well be stunned and angry at the way you spend money.
> The rich spend less of what they have - that's how they stay rich.
Not sure I agree. Many people appear to be rich but are actually in over their heads. Look at many, many pro athletes five years out of their careers.
And back then, mainstream Christian churches were a far more important social institution. Acting as the "generous Christian" was probably far more important to one's standing in "well-born" society.
Also: look at what FedEx pays in Fed taxes. Its zero most years.
This phrase always bothered me because the giant isn't a single person but a stack of people. Knowledge is cumulative.
Another interesting note on Fred Smith, among many on Wikipedia, he inherited $4M dollars and put it all into starting Fedex, creating the $50B company we know today.
The comments in this thread act like the article is committing the great man fallacy because it's talking about the work the founder put into FedEx. Yet, all of that is (presumably) factually accurate, which doesn't detract from larger systemic points, but certainly shouldn't encourage darts to be lobbed. The only folks who can possibly throw stones here are those who are ignorant of the realities of global logistics. Physical logistics is HARD, significantly harder than any problem the average tech worker has had to deal with in their life of air conditioned offices and ever more powerful systems available to them to solve problems.
I mean, my god, FedEx solved the logistical hurdles of package delivery so thoroughly they were able to put an API on top of it. That's got to be worth at least a little admiration.
Bold of you to assume every negative comment is from some ignorant untraveled American.
> As someone who grew up relatively poor in a rural part of the US
Hey, me too! which is doubly annoying considering the thick veneer of condescension in your comment.
Logistics is a hard problem, and fedex has some really interesting stories about that, but don’t come in here and start saying I’m privileged for criticizing the CEO when he’s so out of touch it’s comical.
The fact that he comes from money makes this whole thing even more ridiculous. He did not build anything from scratch, he literally started on 3rd base and was handed his field position before he even started...
This also seems to ignore the fact that UPS existed decades before his company, a company that he intentionally named Federal Express to fool people into thinking it was a government entity...
Naming his company- even better, he apparently gave his dozen or so planes random serial numbers to give the impression he had way more planes. Plane #136 coming in!
Starting at 3rd base- this might be said of the Fords or for the Waltons, but Fred did not inherit the business he built. Yes he had a privileged start, but his daddy certainly didn't hand him an air freight business.
I certainly understand not liking his politics. His comments in the article are bristly.
Fred was trained by the US Gov to fly, went to the most exclusive schools and inherited 40million in the 70s! That's 250million today... You can think this is a story of a selfmade man but you'd be wrong. He may have built a business, but he did it from the highest rings of the ladder having been placed there by his privilege.
Citation needed.
> inherited $4M dollars
There it is! With just a small loan of $4 million you too can be a titan of industry.
Regarding the inheritance, yea its nice, but where is the magical easy button that got him to where he is today. Your comment is sarcastic and not constructive.
It was sarcastic, but it was absolutely constructive of my argument.
> where is the magical easy button
>>> Regarding the inheritance
There. It’s right there. I don’t understand how this is not plainly understood as the easy button.
> It would be nifty to have a non-biased source
Yeah, right? Like what a great thing a source would be right now. I’m glad we can all find common ground.
> but I couldn't match the Fed's offer.
Sounds like the free market won. I don’t know why you’re complaining, this is what you wanted.
One would think that after getting whomped by the ecommerce explosion 20 years ago and scrambling to buy a ground operation he would focus within. As a customer, they seem to be behind the 8-ball with anything outside of that business.