The purpose of this site is to track the flow of money from a customer’s purchase to owners, workers, and suppliers.
As consumers our money shapes our economy and society and we need to consider where that money goes. This includes type of industry but also the transfers within a business- for materials and transportation, as waste, or to workers, management, or taxes. We are particularly worried about the pay that ends up going to the wealthy few who trade in the ownership of the company itself. To them workers, infrastructure, and materials that enable a product or service are “costs of sale” and inefficiently drain company profit.
While it is fair to compensate investors who support a growing company or industry, too little benefit is transferred to everyone else, and in the midst of the great recession our overall economy is suffering. Most people are completely unaware of how much of a single purchase is diverted to wealthy owners instead of supporting people who work at a company or reinvested to improve the fundamental product.
This site does not seek to demonize investing or investors. We would like a greater proportion of society to benefit from economic growth through smart investment. Furthermore, investors as a group act as an important check against upper management. CEOs and other managers’ salaries have increased dramatically relative to the average worker over the past several decades to the harm of everyone. This is a familiar problem however; an additional real problem is the ownership system. Furthermore, managers are often major shareholders as well.
Companies with high profits can be well run and profit may indicate their services are in high demand. But, excess profit typically goes to shareholders, and shareholders are few. We feel that the growth of corporations reflect a growth or change in society at a whole. Growth should be felt by everyone in society not only those who are lucky enough to "own" or manage a company. This aristocratic system distorts the economy, reducing a fair and efficient distribution of resources. When a business does very well, the profits should be reinvested in the core business, given to the employees through higher salaries, or refunded back to customers. Very little should be channeled to owners who have no direct role in the businesses success.
Intelligence and foresight are needed to wisely invest and this should be rewarded. But, as we have seen with the financial crisis of 2008, investors have been too effective in spreading the downside of bad investment and not good enough at picking good investments. This is only made worse by increasingly unequal wealth distribution. Consumers need to pushback against this trend. There is an ever-upward march towards more and more of all of our efforts being directed to the benefit of very few. That makes our economy more volatile and the lives of most of us more impoverished.
Consumer’s interests lie in minimizing the price of product and maximizing the quality. Investors seek to maximize overall profit and direct it to themselves. The information we are trying to compile here could benefit either goal. But we hope people will use it to reward those businesses that most justly acquire and distribute profits.
don'tpaytherich.org
http://www.nber.org/digest/feb05/w10599.html
http://en.wikipedia.org/wiki/File:2008_Top1percentUSA.png
2 fold goals
wiki/user updated list of companies and organizations that pay their employees well relative to top paid executives and a black list of those that pay their executives more than a particularly high salary including benefits and bonuses.
2ndly
however even the CEO is being compensated for his efforts. the real problem is the ownership system.
need a list of companies owned by the aristocrats. companies with low profits but high earnings are ideal. companies with high profits are good in that means their services are in high demand and they are able to convert their efforts to profit. but excess profit goes to shareholders, and shareholders are few. We feel that the growth of corporations reflect a growth or change in society at a whole. that growth should be felt by everyone in society not only those who are lucky enough to "own" the company, particularly when those owners are few. This aristocratic system distorts the economy and prevents the fair and efficient distribution of resources. If a company does very well, we feel the profits should primarily be reinvested in the core business, given to the employees through higher salaries, or refunded back to customers. Very little should be channeled to owners who have no direct role in the business. There is some intelligence and foresight needed to wisely invest and this should be rewarded. but only within limits, and as we have seen with the financial crisis of 2008, a lot more effort has gone into spreading the downside of bad investment than in picking good investments, let alone spreading the upside.
Nothing is wrong with the investment system. when you are investing you should look for strong growing companies and ones that will pay you a nice dividend. But when you are a consumer you are on the other side of the equation. you want a company that gives you something as wonderful as possible for as little money as possible. you want all of your money to merely pay for the thing you are buying. In fact for a consumer it is often good if the company is failing! then they might just be trying to get rid of their stuff and you will get it for a steal.
The point is there needs to be a force directing earnings towards the product in that equilibrium. Unions can be a force that moves resources toward the worker, but they have weakened. Competition can move value to employees and product but also the other way. because it takes money to take money a company can beat a competitor by getting more investment capital. and they can get more investment by paying higher dividends. Exactly the kind of system where you would swamp the competitor with a ton of cheap shit. stuff that takes no skill to make and gives you max profit. As a consumer we need a way to push against that even a little. bad publicity, small choices, anything.
If you are looking at to shampoos, you could scan them with your iphone. one will pay 3% to an awesome rich guy, they other 1%. If they are the same price than i definitely would buy the one that only pays 1%. that excess 2% either will go to waste, or it will go employees and other business. If the company wants to compete it will put that money towards its employees and development.
So, in Michigan we have no local sales taxes but we do have a state tax of 6%. If I were to go to a Lowes and buy myself a cordless drill for exactly $100 I will need to pay an extra $6. That is money out of my pocket but goes to finance many state activities: social support, physical infrastructure, schools, employee wages, corruption, bureaucratic and legislative engineering, grants, debt repayment, ect. Some of these are gigantic costs and some are tiny and some of these expenses clearly help me while some clearly hurt me and some are ambiguous. Some of that tax money even sustains and enables the purchase of the products from Lowes in the first place. I don't get any real choice where it goes though or how much I pay, and most people don't love sales tax.
However, there is another hidden "sales tax" of sorts that we don't notice and for which I don't hear people complaining about. Of that $100 which Lowes gets to keep, some of that goes to pay their employees and some goes to pay their suppliers and some goes to buy more equipment or property. Some also just goes to the owners, the investors and shareholders. In this particular case right now, $11 out of the $100 goes to investors. This is not an increase in the value of their shares, this is actual money paid directly to the owners (through dividends and share repurchase). Most do not even work for Lowes. This $11 then goes to supporting some of the financial industry, but ultimately most of $11 goes to actual investors. It helps them to buy houses, pay bills, go on vacations, get healthcare, ect. There is a decent chance you are technically an investor too, but really the people receiving my money are, on average, buying very large house and very fancy vacations. (Close to 50% of the US owns stocks in public companies in some form, however the distribution of that $11 predominantly goes to the wealthy. Lowes for instance had ~50 billion in sales in 2011 and paid 3.6 billion to shareholders. Anecdotally, you can ask yourself how much you make in capital gains? How big a check did you receive from Lowes? If that money were split evenly among everyone in the US with stock investments (excluding foreign investors for the hypothetical) you should have received ~$20 from Lowes alone. How did you do?) A large part of that $11 is reinvested in the shareholder's "business" That is, it is used to finance more investments, further increasing the amount we pay to that small portion of the population that owns so very much. It is very hard to imagine how these supported activities, supporting the lifestyle of the wealthy and a small sector of the investment industry, helps me or the greater economy, or even helps Lowes continue to function. It is would seem much less beneficial than that $6 which I paid for state sales tax.