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The Rise of the Corporation
Henry Ford had a great idea and deserves praise for building an automobile that the working man could afford.
In 1914 the Ford factory had four assembly lines. Top management sent word to produce 3,000 cars a day
Under the direction of Mr. Avery, Ford's production jumped to 248,307 cars in 1914 from 168,220 the previous year. In 1915, production jumped to 308,213 cars. In 1923, Ford built a record 1.8 million Model T's. As the efficiency of the assembly line drove down costs, Ford was able to cut the price for a basic model T to as low as $260.
Discontented Workers
What everyone agrees on is that the workers hated the new methods. Every foreman had to learn how to say "hurry up" in at least four languages -- English, Polish (putch-putch prenko), Italian (presto-presto) and German (mach schnell).
Men quit in droves.
Though mass production's aim was to whittle tasks down to simple rote and repetition, the revolving door was undermining productivity. Highland Park employed 30,000 people. The work pace was grueling. The final assembly line moved at a speed of eight feet a minute, giving each worker about a minute or less to bolt on his part.
Henry Ford and his lieutenants responded with a decision that infuriated his rivals, and shook up the industrial world. On Jan. 5, 1914, they increased the wages of factory workers to $5 a day. Ford called the pay raise "profit sharing." But it was far more than that. Ford was making a new kind of bargain with workers.
In return for embracing the new technology and the prodigious productivity increases it allowed, Ford workers got double the pay they had earned before, and worked eight hours per shift instead of nine. The move cost Ford $10 million -- but it gained the company far more in the long run. The money slowed the exodus of employees. And it had the side effect of helping to create the mass market of potential car buyers Ford needed to sustain his ambitions.
The money earned by innovative people like Henry Ford allowed companies to become very wealthy. This ushered in a new business philosophy. Move the factory to a place with lots of cheap labor. Men will not be able to quit because there will be no place to go, An even if they do quit the wages of the replacement workers won’t be much more than Ford paid in 1914.
The constant lists of cutbacks, closings, and lost jobs in the US are the result of greed, and unfair business practices that are condoned by the United States Government.
Large Corporations can move their manufacturing facility to any country that has cheap labor. They avoid paying all the taxes that the smaller companies left in the USA have to pay.
Corporations avoid workman’s comp, Medicare, hospitalization, retirement benefits, and Social Security costs. These costs are passed on to the rest of US when the people who loose their jobs have to go on welfare, get food stamps, or steal, to feed their families. Medical costs are increased for everyone when people go to the emergency room because they do not have health insurance.
And to add injury to insult they make the rest of the world hate us. We are letting North Koreans starve because they do not have anything we want. The Mexicans hate us because NAFDA is putting their farmers out of work.
We isolate Cuba because the do not have anything we want but we give China a favored trade rating because they do have something we want, CHEAP LABOR.
We support corrupt governments by buying their oil without worrying about their citizens.
What good are cheap prices at Wal-Mart if you are laid off because your company went out of business.
How can we have a “SERVICE” economy without a worker who can afford to buy the service.
How can a USA worker who makes $10 an hour compete with a Chinese person who makes 50 cents an hour if he or she or the CHILD is lucky.”
The solution -- Give corporations a handicap just like just like you would a golfer to make it possible to compete whey you play the game with them.
Tax corporations that have more than 25% of their assets outside the United States and use the money to rebuild Afghanistan, Honduras, and all those other countries whose names you find on your clothing and underwear.
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Larry King 2/7/03