Customers are the real Job Creators. Neither capitalists nor the capital they own create jobs. Capital chases returns from investment in the labor of others.
Billionaires have been showing off in space; savoring the most far flung of their lifelong dreams by launching $100’s of millions of dollars worth of hardware skyward for a little fix of something only they can afford. Folks have had opinions on it all. Those opinions have run the gamut across two primary poles.
- Selfish Pricks – They could’ve spent the money they accumulated on the backs of exploited workers more beneficially and responsibly by solving any number of dire human problems on a planet that is showing legit, tangible signs of becoming a dumpster fire.
- Hey, Show Some Gratitude – We’re lucky there are folk able to pursue these exploratory dreams on behalf of the rest of us and we should be grateful these cosmic capitalists are creating jobs for hundreds of thousands of people while pushing the boundaries of human possibility.
Cultic Capital Confusion
First – no one has convinced me that the hopefulness of that range of perspectives is in any way mutually exclusive. There’s enough money on the table collectively in this case to fully and fundamentally address a multitude of current human needs AND explore the horizons of human possibility. Where there’s a will, there’s a way. There’s enough money though.
What I am convinced of is that the assumption that these capitalists are job creators flounces past a well worn confusion about the nature of capital, and capitalists, in the job creation equation. Too many of us are unquestioning, even avid followers of the Cult of the Capitalist Job Creators.
Pro-Tip: It’s a false religion.
Pile up as much capital as you like. It won’t do anything at all on its own. I’ll wait…
I’ve watched real live capital at work up close in the wild. I don’t claim to be an expert, but I have had a front row seat for the show. I once share executive and fiduciary responsibility for turning a $20 million pile of capital into a $40 million pile of capital over about a seven year period (during two of the worst stock market crashes we’ve ever experienced – ’03 & ’08).
At no point was a single penny of the capital I helped manage the instigating factor for the creation of a single job. It was an important factor for facilitating job creation, but not the instigating factor.
We even invested a portion of our capital in what is known as micro-finance. That is the financial system of institutions that fund and manage small loans to families and individuals (mostly women) in very poor communities. With amazing rates of success they use those loans to create businesses that will expand their capacity for stability and self determination. Even then, we didn’t cause any of that. We were investors seeking returns from the labor of others.
We sought out the best labor we could find in which to invest. Good labor. Sustainable labor. Self-owned labor.
Still, we weren’t job creators. We were rent seekers; investors seeking returns from the labors of others. I’m not even saying that’s inherently bad, but that’s what it was. It wasn’t job creating.
Just Add Labor
Meanwhile, until you apply some labor a big old pile of capital won’t make a single thing or create a single job on its own. There’s no inherent magic in the use of capital that creates any sustainable jobs. The key word is sustainable. Temporary jobs go away when the capital runs out.
Customers are the Job Creators
Only customers can create permanent jobs. Not that “permanent” is ever really an accurate word for a job. Sustainable is a better word. Only CUSTOMERS can supply the ongoing revenue that makes jobs sustainable over time without depleting capital. Customers are the only thing that transforms the use of capital from being a hobby, an experimentation, or pure vanity into a potentially ongoing business.
Capital owners may create the perception of being job creators. It’s a temporary illusion though. Without customers, their pursuits, and any jobs they may have created along the way, will eventually evaporate.
How much of the future of our economy should we base on cosmic capital in search for customers? How many families should stake their well being on temporary jobs rooted in the self-satisfaction of the whims of the wealthiest few?
The Privilege of Power
The rules and laws that govern how we participate in the economy also shape who has access to opportunities. They also shape the kinds of opportunities available, and the feasibility of those opportunities being available at all. Our rules and laws are dominated by the belief that favoring the interests of the owners of capital is best for everyone involved.
Capital is the least essential and least exclusive ingredient in the sustainability equation. Labor has to be particularly suited to a task by skill and experience. Customers have to be particularly satisfied with a product that meets their needs. When it comes to capital though, pretty much any old capital will do.
Why then do the policies that make up our social economic equation tilt so far in favor of the interests of the owners of capital? Why do the resulting policies so often serve to the detriment of workers and customers? An example may help.
You know the contracts customers are required to sign just as customers of most cable, telephone, utility, and financial services companies, right? These contracts usually include default mediation clauses. Customers forfeit their right to sue a business when they sign those clauses. The business is protected from legal recourse even if it fails to live up to its agreements. That’s quite a privileged legal advantage just for owning a pile of capital.
How do the least exclusively essential players at the table always seem to end up running the game?
The Job Creation Myth
Only religion is powerful enough to bestow the kind of social leverage that allows the least significant minority to run the table. For decades now rent seeking capitalists have set about with billion dollar bullhorns proclaiming the mythic mantra that the owners of capital are job creators and worthy of veneration. The religion has many names, or sub-sects: Rugged Individualism, The American Dream, and Trickle Down Economics just to name a few.
All share a core reality that rent seeking investors profit the most when workers, or customers, are desperate enough to accept low wages and high prices just for the privilege of using capital. The proclamations of this dogma usually subsist in holding up anecdotal success stories as representations of what everyone has waiting just around the corner. All we have to do is just keep worshipping at the grindstone on the capitalist’s altar.
Reminder: By any name – it’s a false religion. The quantifiable outcomes of the increasing wealth disparities that result when the rules favor capital rather than workers or customers have never matched the marketing promises belted from the bullhorns.
Balancing The Job Creator Power Equation
Recognizing CUSTOMERS and WORKERS as the true, enduring Job Creators is the most important first step to demystifying our collectively misplaced faith in capital and its owners. Naming them as such helps us see differently whose needs and interests should be prioritized for the greatest enduring benefit.
Have whatever opinion you will on the personal vanities of the billionaire space race. Just be careful if any of your perspective rests on the idea that the supposed status of “job creators” exempts billionaires from any form of scrutiny for how they participate in our civic economy, or from accountability for the outsized influence their actions sometimes have on the rest of us.
Capital will always seek returns. It won’t always seek the best interests of the customers or workers upon which it depends. That will almost always be a cost-benefit decision.
Prioritizing the well being of customers and workers will be best for everyone in the long run. I’m betting the owners of large piles of capital will be fine either way.