This is long. This is a rant about my workplace. While the story is specific to my employer, it’s actually more of a rant about rampant capitalism, of which my employer is highly adherent to. It is sort of a difficult post for me to write. I’ve been wrestling with myself for the last couple of days on the topic because I’ve felt I have no right to complain. After all, I have a job, I’m paid quite well, the work is easy and in a field I enjoy. There are people who do not have all, some, or even any of those. Why should I complain?
Let’s just cut to the situation, then break it apart from there. Friday morning we got an announcement that because of the pandemic and the resulting slowdown in business at the company, there were going to be some changes implemented. So far, this sounds like every other company dealing with COVID fallout. The changes include: pay cuts (15% for managers and up, 10% for everyone else), discontinuation of 401k matching, discontinuing anniversary bonuses, and discontinuation of PTO cashouts. Earlier in the year, when COVID began, the company announced a wage freeze, so no more raises until things turn around.
How did this affect me personally? I am considered maxed out on salary, so my raises have been trivial for the last few years. A wage freeze doesn’t hurt me too bad. However, a 10% pay cut, wiped out 6 years worth of raises for me. You can also take out 4% of my salary from the loss of the 401k match. The anniversary bonus is something nice to look forward to, and since my anniversary is in a couple of weeks, this stings a little more than usual.
I say again, why should I complain? It’s just money and even with the changes, I’m still probably in the top 10 highest paid people in the company. My finances are very stable. But to not complain is to accept and encourage that mentality that is choking and killing America – I got mine. Fuck you.
This is a family-owned company, and a couple of the family members/owners "work" there. Over the years, their involvement has dwindled as their age has also progressed. They are all very, very wealthy and surely want to spend their lives and their money in other ways.
As spokespeople for the company, the owners have always stressed how the employees are like extended family. However, when we have our annual layoffs, the remaining people are reassured that the company is financially strong. I get it. A company is not supposed to lose money; it wouldn’t survive like that. However, when times are lean and there is a choice to reduce profit or reduce headcount, the same decision is always made.
I say again, I get it. Money can come from a business in three ways: a salary, year-end profits, and the intrinsic value of the company itself. I would be on board if the decision to preserve profit was because the owners only income was the corporate profit. But it’s not. The owners have the intrinsic value, they have the annual profit, and they also all pull a salary from the company. They are triple-dipping and hoarding all the profits for themselves. They sacrifice others for their own gain.
Now, here’s the straw that broke my back with this last announcement. Two things actually. First was the mention of layoffs. The announcement rationalized that when volume was down, the company would lay people off. And why not? They’ve done it every year for at least four years. While they didn’t explicitly say we should be happy they didn’t resort to layoffs, mentioning it at all means it was considered.
So why wasn’t that the decision? Thanks to freedom-loving patriots out there (who I’m sure had to fight valiantly against the current administration), it is in public information that I was able to find out that our company received a PPP loan from the government in the amount of somewhere between 2 and 5 million dollars. A provision of taking that loan is that you do not lay off any workers. So layoffs weren’t an option, although it was still considered. However, there’s no restriction against cutting salary or benefits (research shows that this not uncommon).
If you know the PPP loan program, you know it’s not a loan. It’s forgivable as long as you abide by its rules. So, it’s free government money (it’s not socialism when it’s capitalism, right!). Our company got over 2 million dollars for free to pay for our salaries and our company instead cuts salaries. That improves the company’s profit, which goes to… the owners, exclusively. Hypothetically, lets say our business was down enough that we made no profit this year, we just broke even. With the PPP loan, payroll expenses drop by $2M+, profit becomes $2M+. And that is not enough for the owners. Fuck you, I’m getting mine.
I know business. I know how it can be used to fuck people. I saw it at my last job and I see it here. In my last job, there was a "final con" to fuck the employees and enrich the owner on his way out. While I’m not sure my previous employer actually got to execute his plan before I left, if my prediction for this company’s "final con" is correct, it’s already a done deal.
The owners are old and not involved in the business anymore. They want out. Business is down and has been down for quite some time. That is bad for the owners. When someone wants to buy a business, they want to see what return on investment they will get from it. If the company isn’t turning good profits, its value (the sale price) decreases. While anyone pitching the company is going to point out the glory years as what the company is capable of and will also hype the potential of the business when COVID ends, they still need to prove short-term viability and profit.
I’ve already told you the secret a few paragraphs ago. Reduce expenses, profit goes up. By cutting everyone’s salary and the 401k benefits and anniversary bonuses and the cash value of PTO, the company immediately looks better financially to a buyer. The buyer has no obligation to restore any of those things. For all they know, it’s always been that way. Maybe they would see in a prior year financial statement that expenses were much higher, but why should they care? The current and future financials say they’ll make good money.
Pause for a moment and absorb all that. Now, because I have to explicitly say this, if the company looks like it will be more profitable to a buyer, the company can be sold for more money. That money goes to… the owners, exclusively. The salary and benefit cuts remain.
Now, in closing. I do get it. This is business. Do not ever feel like your employer give one single shit about you or your life. Are there exceptions to this? Sure. But America is greed and selfishness personified. It’s going to take generations to turn this around if it even can be turned around. It’s not going to happen in my lifetime for sure. I really do empathize with the younger generations and what they are facing.
Ok, Boomer
https://www.bloomberg.com/opinion/articles/2019-11-04/millennials-should-be-happy-they-are-stuck-renting
“Millennials spend a lot of time bemoaning their inability to buy a home, forcing them to keep renting. They should want to stay renters, if they know what’s good for them financially.”
You son of a bitch.
This fucking article, written by an economist, is trying to sell the idea that people are better off renting than owning a house. And specifically, millennials are better off doing it. You wonder why young people hate the boomer generation? Well, this is a pretty good piece of evidence. Take away the condescending tone and you actually are left with malicious advice.
It’s amazing to me the slight of hand that is performed in order to make the pitch in this article. The author actually says that buying a house is a losing proposition. “…it has cost the homeowner 3% per year to own a house before taxes, maintenance, utilities and insurance. That’s a real negative return.” A goddamn economist, who manages investing funds, is selling this shit.
Then this paragraph:
“Some millennials were caught up in the subprime mortgage boom and collapse, and remain scarred by it. They believed they could buy houses with no money down and never shell out a dime because continuing rapid appreciation would allow for continual refinancings. So the bursting of the subprime mortgage bubble and subsequent one-third decline in house prices was a rude awakening, especially since it was the first nationwide drop in values since the 1930s.”
This needs some unpacking. First, not just millennials were caught up in this shit. Everyone was. But who was most vulnerable to it? And that snark about what millennials believed? You fuckers sold them that belief. You convinced them. They had no prior experience in real estate investing and falsely trusted you. So then we get the first housing crash since the 1930’s. Thanks for that.
Look, I’m no economist. I’m just a former renter who became a homeowner. When I went to purchase my new house, my simple criteria was, “is the same cost as what I’m paying in rent?” That was my budget and that’s where I went. I completely understand the issue of house prices being insane, but I also see what rent costs and it’s not much better. So, I encourage anyone to buy when they can. If you have to start small, do that. Don’t hold out and wait until you can afford big. And don’t listen to this bullshit that you shouldn’t buy at all.
Here’s the truth that the author is not telling you. It’s very simple. When you rent, you get nothing for your money. You get lodging and that’s it. When you own, you keep what you spend. People want to argue that housing doesn’t have a high rate of return on investment? Fuck them. It’s not supposed to. They say, what if you own a house for 10 years and sell it for what you paid for it, not gaining a cent? You fucking assholes, you gain all the equity in the property. All the money you paid into the loan (minus interest of course) is equity. You get that back. If you’re renting, what happens when you end your lease? What equity do you get from that? That’s “not gaining a cent”.
Then they can argue that property values can fall. Yes, this has happened once. Do I think it will happen again? Probably, but not as extreme as last time. But here’s the thing. You don’t lose money until you sell. I was underwater over $30k at one point. I kept making my mortgage payments and the property value eventually came back. And all the payments I made while it was underwater? Guess what? They still counted! Just like every other payment. It’s all equity. Stay the course!
So, you want to know why this fucking boomer wants you to keep renting? He’ll tell you right at the end of the article.
“The trend toward renting over owning should persist and may even increase. I continue to favor investments in rental apartments—assuming, of course, they meet the location, location, location test.”
So you better keep renting, if you know what’s good for you. And what’s good for you is very good for me.