WHY EXECUTIVES DON’T STRIKE

Strikes. They’re a nuisance, aren’t they? Bringing disruption to our lives by denying us the services we rely on. But have you ever noticed how the workers who organise strikes always seem to be employees at the lower end of the corporate hierarchy? It’s always blue-collar workers, junior doctors and other lowly types that are threatening such action. Executives, for some reason, never stage a walkout.

I wonder why that is?

Now, some might think the reason is obvious: Strikes are undertaken in order to get more pay, and so executives have no need for such action as they are already very handsomely compensated. For example, if you are an advertising executive your yearly salary is around half a million pounds. Not too bad!

But, actually, ‘more money’ is not the only reason why workers feel the need to strike. Sometimes, strike action is undertaken in order to bring to the world’s attention unfair working practices. If being treated unfairly justifies a walkout, then maybe executives would have a reason to strike?

Think about how such people are portrayed in movies. In nearly all cases, executives in films are portrayed as corrupt. You have Gordon Gecko in ‘Wall Street’, breaking laws and destroying small businesses in his thirst for more dirty money. You have the executive classes in ‘Elysium’, living in luxury aboard their space station while down on earth their overworked, underpaid blue-collar employees are callously discarded when they fall foul of atrocious working conditions the higher-ups are too uncaring to fix. You have the CEO of OCP looking on in concern as Robocop2 lays waste to the city- not concern for the people it’s killing mind you, but at what it could mean for his company’s shares (“this could look bad for OCP, Johnson! Scramble our best spin team!”).

Those are just a few examples of films that make business men out to be bad guys. Now try to think of movies where executives are not portrayed as villains, but as heroes. I can only think of two. Batman’s Bruce Wayne has a strong moral code. But that’s not a particularly good example, because he is only being altruistic when he is the Caped Crusader. His ‘Bruce Wayne’ persona is of a billionaire playboy who is a bit of a prick. And in the Christopher Nolan films the board of directors that run Wayne enterprises are your usual bunch of villains in suits. The other example I can think of is Ayn Rand’s ‘Atlas Shrugged’, and do you know what that book and movie is about? It’s about successful businessmen becoming so disgruntled with being portrayed as villains by society that they go on strike.

So, given how often successful businessmen are portrayed as bad guys, why don’t they ever stage a walkout and remind us all of how much we rely on the work they do, just as their fictional counterparts in Rand’s opus did?

I think the reason why is as follows: because it just wouldn’t work out the way it did in ‘Atlas Shrugged’. In that story, the consequences were that society soon started falling apart. When workers low down in the corporate hierarchy stage a walkout, the effects are, indeed, most often immediate and near-catastrophic. Everything grinds to a halt, everyday life is hopelessly disrupted, and we are reminded that such people provide vital services we can scarcely do without. I would suggest that if the executive classes were to stage a walkout, life would not grind to a halt, at least not for quite some time. On the contrary, most people would not even notice anything amiss.

Now, you might counter that this is mere speculation with nothing to back it up. However, I believe there are a couple of examples that indicate that what I say is true.

The first example involves something that happened during the decade from 1966 to 1976 in Ireland. During that time, Ireland experienced three bank strikes that caused banks to shut down for a total of twelve months. During the time in which they were closed, no checks could be cashed, no banking transactions could be carried out, and the Irish lost access to well over 80% of the money supply.

You would have thought this would have spelled utter disaster for Ireland. After all, banking executives are among the top earners (paid around £5 million a year, as well as being awarded endless bonuses) and we’re always being told of the utterly vital function the banking and financial sectors play in the economy. Surely, then, Ireland was brought to her knees very soon after the banks closed their doors and removed their services?

Actually, no. Instead, the Irish just carried on doing business without the banks. They understood that, since the banks were closed, there was nothing to stop people writing a check and using it like cash. Once official checks were used up, people used stationary from shops as checks, written in denominations of fives, tens, and twenties. And it was not just individuals who operated this mutual credit system, businesses also got in on the act. Large employers like Guinness issued paychecks not in the usual full-salary amount but rather in various smaller denominations, precisely so they could be used as a medium of exchange as though they were cash.

All this was possible because, at the time, Ireland had a small population of three million inhabitants. In most communities, people had a high degree of personal contact with other individuals, and where knowledge of somebody was lacking, local shops and pubs had owners who knew their clientele very well and could vouch for a person’s creditworthiness.

According to economics professor Antoin E. Murphy, author of ‘Money in an Economy without Banks’, “The Irish created an unregulated, totally anarchistic community currency matrix…there was nobody in charge and people took the checks they liked and didn’t take the checks they didn’t like….And, it worked! As soon as the banks opened again, you’re back to fear and deprivation and scarcity. But until that point it had been a wonderful time”.

A few years before the Irish incident, New York’s refuse collectors went on strike and just ten days afterwards the city was brought to her knees. I don’t think anyone would have described that situation as ‘a wonderful time’. Unlike the millions paid to city bankers, refuse workers get around £12,000 a year.

Another example suggesting that executives wouldn’t be missed for quite some time were they to disappear would be the company Uber, for it has seen not only the resignation of its founder, Travis Kalanick, but also a whole bunch of other top executives, so that, according to a 2017 article in ‘marketwatch’, it “is currently operating without a CEO, Chief operating officer, chief financial officer, or chief marketing officer”. Did the company fall down without the aid of these essential people? No, it carried on just fine without them.

Now this is intriguing. Why is it, that when low-paid staff nearer the bottom of the corporate hierarchy go on strike we feel the pain almost immediately, but on the rare occasions when highly-rewarded executives don’t show up for work nobody cares because nothing much changes?

I think it all hinges on what these people actually do. What do they actually do? It’s hard to say, because any role you can think of that might be of use to a company turns out to be a job description for somebody lower down the hierarchy. Do they make anything, these executives? No, the workers down in manufacturing do that. Do they manage anything? No, managers do that. Are they responsible for sales? No, that’s what salespeople are for. And so on and so on. Now, I’m not suggesting the CEO does literally nothing but it stands to reason that when you have delegated responsibility for just about everything to your subordinates, it’s going to harm that company much more if the subordinates don’t show up than if you were to disappear.

And that’s just counting the official jobs subordinates have. But what about unofficial ones? Take Personal Assistants. If you have ever watched the Apprentice you know the sort of employee I am talking about: The woman or man at the desk who answers the phone and says ‘Lord Sugar/ Mr Trump will see you now’. According to David Graeber, secretarial work like answering the phone, doing filing and taking diction is not all PAs do. “in fact, they often ended up doing 80 percent to 90 percent of their bosses’ jobs, and sometimes, 100 percent…It would be fascinating—though probably impossible—to write a history of books, designs, plans, and documents attributed to famous men that were actually written by their secretaries”.

So businesses seem not to be negatively affected when executives don’t show up for work. But when they are present, is their work of value to society? Not according to studies into negative externalities (in other words, the social costs of doing business) Let’s take the example of advertisement executive mentioned earlier. As you may recall, advertisement executives bring home a yearly salary of around £500,000. But the studies reckon that around £11.50 of social value is destroyed per £1 paid. Contrast this with a recycling worker, who brings home a yearly income of around £12,500, and creates £12 in social value for every £1 they are paid.

This, then, is why executives don’t strike. Far from reminding us what a valuable service they provide, it would instead shine a light on how businesses could function perfectly well without them, at least for much longer periods than they could function if their much lower-paid subordinates were to stage a walkout. For people who are a credit to society in terms of creating more social value for every pound they are paid, strike action can be an effective way of empathising the value to society their work generates. But that can hardly be the case when your work causes negative externalities that cost society more than it benefits from your existence. In that case, strikes can only shine light on the fact that you are not all that necessary.

REFERENCES

‘Bullshit Jobs: A Theory’ by David Graeber

‘Rethinking Money’ by Bernard Lietar and Jacque Dunne

“Money in an Economy Without Banks’ by Antoin E. Murphy

“Marketwatch”.

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