Beware: the big corporation

Beware - the big corporation

While working on the book I’m currently writing, Future Girl, I realised that one of the key subtexts for the book is the idea that big corporations are dangerous to us.  This is something I feel very strongly about, and although I’m not perfect, for the most part these days I refuse to give my money to big corporations, especially those that I believe to behave irresponsibly.  I created this painting to express my outrage at the central place that these big corporations occupy in our society.

So what’s wrong with big corporations?

You could say that we are the new serfs, with big corporations as our lords, regulating every aspect of our existence and requiring our servitude.  Is this really so?  Are big corporations actually bad, and if so, why?  I’ve done some research to try and understand the ways in which big corporations impact and shape our society.

The thing about big corporations is that they are just that: big.  They rake in the bucks, and as a result, have enormous spending power.  Since the ethos that underpins most big corporations is the aim to increase profits, values such as quality and meaning of life, job satisfaction and health are often cast aside in pursuit of the dollar.  But surely we, as individuals, have the power to make our own choices about how we live, how we bring meaning to our lives, and to look after our own health?  The reading I’ve done suggests that no, actually, we are dominated in many subtle and not-so-subtle ways by the corporate monoliths that surround us.

How did we come to need them?

Let’s take the fast food industry as a general example, and look at McDonald’s in particular.  Since 1973, once adjusted for inflation, the hourly wage of the average worker has declined.  These days it’s very hard to run a household on one income, and with two adults out at work, there’s a need for some of the domestic tasks that used to be performed by women at home (such as food shopping, cooking and washing up) to be outsourced.  McDonald’s is just one large corporation that has stepped up to the task.  The company is the largest owner of retail property in the world, America’s largest purchaser of beef, pork and potatoes, and an estimated one in eight workers in the US has at some point been employed by McDonald’s.  The company has the world’s largest marketing budget, and even operates the most playgrounds and distributes more toys than any other brand.

Targeting our children

With playgrounds and toys, McDonald’s is very appealing to young children, a deliberate part of their marketing strategy.  Not only will children bring in extra customers in the form of parents and grandparents, but their ‘pester power’ can be harnessed to increase sales.  ‘Cradle-to-grave’ advertising strategies involve getting young children to see a company as being like a beloved family member, allied with good values such as health and patriotism, and the aim is life-long brand loyalty.  Young children are mainly reached via television, and studies have showed that most cannot distinguish between programmes and advertisements.  While McDonald’s and Disney pioneered the targeting of children in marketing, it is so effective that these days it is a standard part of the long term selling-strategy for most large corporations.  The result is that many youngsters today grow up with an overall feeling that their favourite brands know and care about them.

Fast food companies extend their marketing reaches into schools, knowing that children are still establishing their tastes and habits, and have many years of purchasing ahead of them.  Schools on tight budgets often accept lucrative advertising packages offered by large corporations, justifying that this increases their revenue and allows them to expand what they offer to students.  It is not just food companies that employ this technique.  Corporate-sponsored teaching materials have now become commonplace, and in 1998 a study in the US by the Consumers Union found that 80 percent were biased.  For example, they would teach that logging was good for the environment or that fossil fuels created few environmental problems.

Walt Disney has hosted numerous ‘entertainment’ broadcasts which are really propraganda, such as “Our Friend The Atom”, sponsored by a manufacturer of nuclear reactors, which makes nuclear fission sound fun instead of terrifying.  By reaching our children through television programmes and commercials, schools and prominent billboards, big corporations have significant power to shape the values and messages our children grow up with.

Exploiting vulnerable workers for cheap labour

Teenagers, too, are targeted by big corporations, and often used for cheap labour.  The two brothers who opened the first McDonald’s restaurant quickly tired of having to retrain staff when they left.  They created an innovative solution that has since been replicated by large, profit-seeking companies everywhere.  They restructured the workplace to an assembly-line format, where each worker contributes only a single, small skill.  A staff member might spend, for example, an entire eight hour shift just flipping burgers.  If that worker leaves, it doesn’t take long to train the replacement in burger-flipping.

With the de-skilling of jobs, corporations are able to hire unskilled workers who will accept low pay, often teenagers and migrants who are also easier to control, and less aware of unions and fair work standards.  They can be manipulated into working long hours, without overtime pay, by managers whose annual bonuses depend on them increasing profits and reducing costs.  While an after-school job has been shown to be good for children, studies have shown that when kids work long hours in addition to schooling, and when the job is boring, overly regimented or meaningless, it can create a lifelong aversion to work.

For teenagers, working at a fast food outlet can be surprisingly dangerous.  The injury rate for them is about twice as high as that of adult wokers in the United States.  With a high staff turn-over, many disgruntled ex-employees return to rob their former workplaces, sometimes resulting in violent crime and murder.  While being a manager at McDonald’s is a far more interesting and rewarding job than lower positions, and even includes training at McDonald’s ‘university’, managers are most often targeted in violent crimes by ex-employees.  In America, four or five fast food workers are murdered on the job every month, making it more dangerous than to be a police officer!

Fast food restaurant chains use their buying power to keep the minimum wage as low as possible.  For example, the Nixon administration received $250,000 in donations from the head of McDonald’s franchising, and in the same year supported a bill to reduce the minimum wage from $1.60 to $1.28 per hour – the bill was even known, informally, as the ‘McDonald’s bill’.  Meanwhile, the income of the company CEOs has consistently risen.

Side-stepping regulations

The Fair Labour Standards Act was designed to prevent unfairness, danger and injury to our workers, and unions aim to enforce these laws.  However, McDonald’s and other large corporations use their immense purchasing power to sidestep regulations.  When workers attempt to join unions or fight for fairer conditions, McDonald’s will simply close down the restaurant and fire all its staff, reopening new premises nearby.  When re-hiring, they avoid all staff who have previously signed union cards.

Franchise risks

Workers higher up the chain in the fast food restaurant business also face challenges.  For example, franchise owners absorb all the risk involved in starting a new branch, often legally waiving their right to file complaints, while the corporation maintains control, forcing them to buy from certain suppliers and follow fixed price schedules.  Corporations often practise “encroachment” – placing new franchises close to existing franchises, driving down the sales of the established buisness.  As with the minimum wage, large corporations use their significant financial power to lobby the government to thwart regulation of franchising.

Forcing suppliers to cut corners

As well as negatively impacting the lives of our children, vulnerable workers and franchise owners, large corporations often impose stringent requirements on their suppliers, forcing them to run manufacturing premises which are both dangerous and unpleasant for workers.  It is common for the few buyers of a single product (say, potatoes, used for chips), to band together and make a behind-the-scenes agreement about the price they are willing to pay.  Potato growers and processors cannot then turn to an alternative market for better pay, which would enable them to maintain better conditions in their plants.

Price fixing

In America, only four firms slaughter about 84 percent of the cattle (ConAgra, IBP, Excel and National Beef), and they have devised an ingenious method of price-fixing to ensure that cattle prices from independent ranchers remain low.  They buy up 20 percent of the nation’s cattle and hold them in feedlots.  Then when ranchers try to increase their prices, the meatpacking giants flood the market with their own captive supplies, forcing prices to drop.  In twenty years, the rancher’s share of the retail dollar has dropped from 63 cents to just 46 cents, forcing small farmers out of business, and forcing large enterprises to cut corners to maintain their ranches.  Ranch owners need to take second jobs or sell their cattle at break-even prices or a loss, and the suicide rate among ranchers and farmers in America is now three times higher than the national average.

In a similar fashion, chicken growers must adhere to strict feeding schedules, equipment upgrades and veterinary services, in order to sell to the meatpacking giants.  The necessary growing house, which holds 25,000 birds in overcroweded, stressed conditions, costs about $150,000, forcing the growers into significant debt before they can earn anything.  The average chicken grower in America earns just$12,000 per year, and about half of them quit after just three years, selling out or losing everything.  Growers who complain often find themselves suddenly unable to sell their birds.

Dangerous factory conditions

Like the fast food restaurants who slashed costs by creating an assembly-line format for their workers, enabling them to hire unskilled employees at minimum wage, the meatpacking giants have also restructured their plants to use assembly lines.  The meat travels on a large conveyor belt through the factory, and staff members stand in a single spot for their entire shift, making exactly the same cuts or moves over and over again.  One way for a meatpacking company to increase profits, is to run the line faster.  The same systems that once processed 50 cattle per day, have now been sped up to process 400, resulting in enormous danger to employees.  The injury rate in a meatpacking factory is about three times higher than elsewhere, and every year more than a quater of a factory’s workers are injured.  The work is heavy and repetitive, causing strain injuries, back problems and tendonitis, and lacerations are the most common form of injury.  The injury rate correlates directly with the speed of the production line.  It is common for workers to lose limbs on the job, and anecdotes in Fast Food Nation by Eric Schlosser suggest that these limbs, and sometimes entire people, end up ground in with our meat.

Such a high injury rate usually results in pressure from insurance companies to improve work practices, but large corporations like ConAgra and IBP are self-insured.  Like McDonald’s, they avoid unions and regulation by firing employees after an average of four months on the job, maintaining a vulnerable workforce (often of illegal migrants), and closing down plants when things get out of hand.  They also use in-house doctors to medically assess injured workers, and these doctors are under pressure to deny the existance and severity of injuries, so as to minimise compensation costs borne by the company.

Food poisoning – the spread of dangerous bacteria across the nation

Food poisoning, while rarely reported in the media, is a surprisingly common result of eating in a fast food restaurant.  In America, every day 200,000 people become sick from food poisining, 900 are hospitalised, and 14 die.  Food poisoning has been shown to have long term effects, beyond the initial gastrointestinal illness, and can herald chronic disease such as autoimmune disorders, kidney damage, heart disease and inflammatory bowel disease.  In 1996, a study showed that meat samples taken from meatpacking giants had a high rate of contamination with salmonella, listeria, staphylococcus and clostridium, all of which can make people ill.  E. Coli is also frequently found in meat samples, along with faeces, hair, insects, metal shavings, urine and vomit.

The reason for this high rate of contamination relates directly to the speed of the production line.  These bacteria are found in the faeces of infected animals, and at the time the stomach, bowel and intestines are removed from the animal, great care must be taken not to spatter the carcass with their contents.  It takes a skilled butcher to do this job well, and accuracy depends on taking the time to do it properly.  With the high speed of the line, and the reduction in skill of the workers, spillage of faeces onto the meat happens in as many as one in five carcasses.  The contaminated meat remains on the production line, and is mixed with cleaner carcasses, resulting in a very wide spread of dangerous bacteria.  In pursuit of profits, the meatpacking giants are endangering the health of the entire population.  Although they claim that once cooked, the meat is safe, the reality is that by bringing contaminated meat into our kitchen, we risk the spread of dangerous bacteria onto our knives, chopping boards, into our sinks and more.  Charles Gerba, a microbiologist, discovered in a series of tests that the average American kitchen sink contains more bacteria than the average American toilet seat!

Disregard for the public and workers is endemic

While I have focussed on the fast food industry, the danger faced by workers of corporate monoliths, the disregard for the health of the population, and the pursuit of profit at the expense of all other values appears to be endemic across large corporations.  For example, as I write in 2014, Apple has fired 24 employees (leading union members) for refusing to work on public holidays.  Conditions in factories where clothing, mobile phones and other consumer goods are made are regularly reported in the media as being miserable and dangerous for workers.  Even the courts agree that big corporations often behave irresponsibly.  In a case against McDonalds, Justice Bell concluded that the company did exploit children through its advertising, endanger the health of customers who eat there several times a week, pay its restaurant workers unreasonably low wages, and bear responsibility for the cruelty inflicted upon animals by many of its suppliers.

The reality is that large corporations use their immense budgets to sidestep regulation and to lobby the government for laws that will make them richer and more profitable.

What can we do?

Is there anything we can do?  The single, most powerful act an individual can make, is to refuse to give them our money.  It is our money that makes them powerful, and by withholding it, we are one step closer to diffusing their dominance.  Choose carefully to whom you give your dollars, and vote now, with your purse.

I used to think this was an impossible mission, but one step at a time I have made changes to my shopping habits, so that these days I rarely buy from big corporations.  I buy my food from farmer’s markets instead of supermarkets, I eat out at family-owned non-franchise restaurants, and I rarely buy new mass-manufactured products – instead I make my own or look for similar items in second hand shops.  Choosing to spend your money ethically cannot be done in a day.  It takes time to change habits and work out a new way to provide Christmas presents, a new way to eat, a new way to do all the things we regularly rely on big corporations for.  But it can be done, one step at a time.  If you have tips or ideas for making the change, leave a note in the comments!

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