Verizon sticks it to its workers because $45 billion isn’t enough

Does a company that racked up $45 billion in profits over the past five years really need to stick it to its employees? The answer depends on who’s asking. From any ordinary human standpoint, clearly no. From the perspective of Wall Street and corporate board rooms, the answer is always an enthusiastic yes.

Class warfare is on display in stark terms at Verizon Communications, and although such direct terms are avoided by the corporate media, there is much talk of the strike against Verizon by the Communications Workers of America and International Brotherhood of Electrical Workers as “labor’s last stand.” That might be a little hyperbolic, or it might be wishful thinking, as such talk of last stands is often intertwined with juxtaposing unionized older sectors with non-unionized sectors that are promoted as “new” and “vibrant.”

We've seen this before: Three unions protest outside Verizon headquarters in Philadelphia in August 2009 (photo by Liz McElroy, for the aflcio2008)

We’ve seen this before: Three unions protest outside Verizon headquarters in Philadelphia in August 2009 (photo by Liz McElroy, for the aflcio2008)

Typical of the corporate media is this report from NBC News, referring to Verizon’s non-unionized wireless operations:

“ ‘The question is, is there going to be a unionized presence in this advanced, technologically innovative kind of industry?’ said Nelson Lichtenstein, director of the Center for the Study of Labor, Work, and Democracy at the University of California — Santa Barbara. The likely answer doesn’t bode well for unions.”

Perhaps an unconscious nod to the technology sector’s old-fashioned exploitation of workers despite its carefully calculated image of modernity, online media has been as responsive to corporate power as has the traditional corporate media. A study of four prominent outlets conducted by Fair & Accuracy In Reporting found 31 direct quotes, either via interviews or press releases, by management during the first days of the Verizon strike versus 13 by workers. The FAIR report said:

“Corporate media coverage of this strike illustrated the fundamental asymmetry of power that still exists between multi-billion-dollar corporations and comparatively small unions. (A union like Communications Workers of America has an annual budget roughly 1/500th of Verizon’s annual revenues of $131 billion.) An analysis of coverage in two major ‘old media’ outlets (New York Times and Washington Post) and two ‘new media’ outlets (Buzzfeed and Vox) exposes a consistent pattern of prioritizing management’s voice over that of the workers or their representatives, to the tune of roughly 2-to-1.”

More is never enough at the top

About 40,000 Verizon workers walked out on April 13, and Verizon continues to take a hard line against its employees. Despite the $45.3 billion in net income the company has reported for the past five years, its notorious tax dodging (more on that below) and the $350 million in compensation ladled out to its top five executives during a recent five-year period, Verizon’s line is — guess what! — the workers are greedy. (Incidentally, Verizon laid off 39,000 workers during that five-year period.) They are portrayed as greedy because they believe they should be paid a living wage and shouldn’t have to relocate for months at a time, away from their families and communities.

Among the complaints of the strikers are Verizon’s moving of call-center jobs overseas; closing of U.S. call centers; outsourcing other work, including installing and maintaining phone lines, to low-wage, non-unionized contractors; and being forced to work far away, sometimes hundreds of miles away, for months at a time. Working conditions are also an issue, as a Communications Workers of America strike update notes:

“Verizon management has created a sweatshop environment with its excessive monitoring and unreasonable overtime assignments. Employees are monitored in call centers by the electronic recording of every call. Outside technicians are monitored with a Global Positioning System tracking every aspect of movement of the company vehicles. The mismanagement of these monitoring tools has created high levels of stress affecting employee productivity and morale. Call center management routinely assign overtime to employees and then without any concern for the employee’s quality of life cancel assignments less than 10 minutes before the scheduled overtime while directing calls to contract vendors. Outside technicians have been forced to work overtime to the point of exhaustion because the Company has not hired enough technicians to keep up with the workload. Members deserve better treatment than this.”

A classic example, not only of the inhuman treatment often meted out by corporate managements, but of technology, in the hands of capitalists, being a tool of repression rather than “liberatory.” This parallels the supposed “innovation” of technology companies that misclassify their employees as “independent contractors” to exploit them more ruthlessly, thus putting old models of weakening labor protections in new “high tech” wrapping. Nor is there anything new about corporations making hundreds of thousands or even millions of dollars per employee and crying they don’t make enough.

A leader at tax dodging

Dodging taxes is yet another capitalist “innovation.” Although far from alone in this, Verizon is flatly lying when it claims it pays the standard 35 percent corporate tax rate of the U.S. In fact, Verizon enjoyed a tax rate of minus two percent for the period of 2008 through 2013. Yep, despite racking up $42 billion in profits during those six years, it paid no federal taxes. For the years 2008 to 2012, Verizon received a composite $535 million in tax rebates. Although the company did pay taxes the past two years, it paid at a rate lower than what its employees pay.

Then there are corporate subsidies — Verizon pocketed $60 million in subsidies over the past decade from the New Jersey state government alone, yet far from hiring new workers, it laid off more than 300 in that state. The corrupt administration of Governor Chris Christie, which has handed out billions of dollars in corporate giveaways, did not ask for the money back from Verizon despite the failure to create jobs.

Once again, Verizon is not unique. Tax dodging by multi-national corporations costs the U.S. about $111 billion per year, according to an Oxfam report.

As an added insult, Verizon spent $110 million on lobbying for the years 2008 to 2014, and holds $1.3 billion in cash in offshore accounts — money that is hidden so as to not be not taxed.

That such behavior is the corporate norm does not excuse Verizon. A company that reports billions of dollars in annual profits, pays millions to its executives and dodges taxes by the billions can afford to pay its workers a living wage and treat them with dignity. Underlying this battle is Verizon’s wish to concentrate more of its workforce to its non-unionized subsidiaries. Workers in the company’s Verizon Wireless unit are not represented by a union and make far less; Verizon is far more interested in investing in this portion of its business than its legacy landline and cable businesses.

Neoliberalism and the promotion of jealousy

A New Yorker article that was not sympathetic to the strikers nonetheless pointed out the big differences in wages that unionized workers are defending:

“When Verizon workers walked off the job in 2000, there were eighty-five thousand workers striking, and they represented the main part of Verizon’s business. In sixteen years, the number of unionized workers has fallen by more than half. And it’s worth noting that a customer-service agent who makes north of sixty thousand at Verizon would make closer to thirty-six thousand on the company’s wireless side, according to the job site Glassdoor.”

Neoliberal ideology aims to generate jealousy that someone else has a good wage with benefits and some measure of security, lest too many people get the idea that they ought to have those wages and benefits, too. Recall the public-relations battle over the removal of collective-bargaining rights from Wisconsin public workers in 2012. Wisconsin Governor Scott Walker and the corporate powers that animate him waged their war on working people through careful framing.

Conservative ideology insists the question should be “Why does someone have something you don’t have” (such as a pension), instead of “Why do you not have something that you should be entitled to but don’t have.” Once the question was framed that way in Wisconsin, and anti-government rhetoric was wrapped around it, there was a short path to making pensions indistinguishable from excessive government spending.

In that case, government workers were specifically made scapegoats for tactical reasons, but unionized workers are more generally the target of scapegoating, and Verizon flacks have made sure to inflate the actual size of strikers’ wages so as to portray them as “greedy.” It remains to be seen if this tactic will work if the strike become lengthy. It also remains to what extent union leaders will cuddle up to the Democratic Party, and thus dampen rank-and-file militancy. Democrats are openly supporting the strikers right now — it is an election year after all — but the decades-long tactic of unions throwing support to Democrats without asking for anything in return has played its part in the decline of unions and increase in inequality.

When you guarantee unconditional support, when you keep your mouth shut when you are forgotten after the election, when you desperately suppress any independent mass movement, when you are so comfortable in your bubble that you can’t conceive of doing anything different, when you are unable to differentiate between a crumb and a loaf, you will lose. And you will keep losing. It’s long past time for working people to build our own organizations independent of corporate parties and to end illusions that the system that creates a Verizon can be reformed and made “nice.”

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13 comments on “Verizon sticks it to its workers because $45 billion isn’t enough

  1. fridihem says:

    So, whats new, US companies are run by big obese pigs

    • It’s not useful to reduce material conditions to personalities. Corporate greed is structural; replacing executives with others with presumably “nicer” personalities would make no real difference. The relentless competitive pressure of capitalism, it’s “grow or die” imperative, is the root of the cause. Placing blame on “pigs” implies reform is possible when it is isn’t.

      • fridihem says:

        Funny that the same type of dishonest greed doesnt happen so much in other countrues………

        • Actually, it does. Perhaps it’s more extreme in the U.S. as the center of the world capitalist system, but the same dynamics hold elsewhere. That’s why there is the Trans-Pacific Partnership, the Transatlantic Trade and Investment Partnership, the European Union and all the rest.

          The E.U. is European capitalists’ attempt to replicate what their U.S. counterparts have.

  2. I truly look forward to each article you write! You have the ability to put into words that which I can see and feel is going on the World but can’t seem to put into words myself. I have a question though..(and I know your just the messenger) Is it honestly possible to stop this train wreck of humanity with the numerous issues we currently face?

    • Thank you for such kind comments, Bryan. To answer your question, I believe it is possible. Doing so will be very difficult, and humanity might not stop the train wreck; certainly on the present course we won’t. The capitalist system seems impossible to dislodge — and I would never underplay the enormity of the task humanity faces — but nothing of human creation lasts forever.

  3. It’s great to see US workers start to take back power with a 40,000 worker nationwide strike.

  4. MatthewHoh says:

    Excellent article Pete. I’ve been a Verizon subscriber for 13 years and, even though I must admit I have received very good service, I’d like to switch carriers as I read about Verizon’s treatment of workers. Can you recommend a wireless carrier that treats its workers fairly?

  5. DemolishingBS says:

    I don’t really have much to add, just that even “liberal” magazines like The New Yorker attacking strikes for higher wages to me is just an amusing example of how the “liberal” mainstream is becoming little different from the right-wing conservatives.

    • Liberal thought is constrained by its adherents’ wish to make reforms while keeping the capitalist system intact, and thus are as attached to modern capitalism as are conservatives. Accepting this, no matter what reforms you might wish, means accepting the shibboleths of capitalist ideology and thus constitutes a dead end in my opinion.

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