Feed the Hungry?

Another timely article from Common Dreams.

The inhumane attitudes toward the poor and needy in our nation, especially in government are disgusting and un-American.

Go to http://www.usa.gov/Contact/Elected.shtml to identify and email all your Federal (and State) Representatives.

Published on Friday, May 31, 2013 by Common Dreams

Congress' Farm Bill Readies to Kick Poor Off Food Assistance

Despite billions in subsidies to giant agricultural operations, some of nation's neediest about to lose

- Jon Queally, staff writer

 
People wait in line at a grocery store in New Orleans. With long-term unemployment still high, and with overall unemployment expected to drop only slowly for several more years, cutting the Supplemental Nutrition Assistance Program is likely to do significant harm to millions of families and workers. (SOURCE: AP/Eric Gay)If the House GOP gets its way, the new Farm Bill passing through Congress will prove the perfect opportunity to make some of the nation's most poor and vulnerable even less secure.
At stake, funding for the Supplemental Nutrition Assistance Program (called SNAP), which provides access to staple foods for millions of families living beneath or skirting the poverty line.
"For millions of Americans, that monthly food allowance is an unsavory reminder of the consequences of social disinvestment: no matter how hard you work, at the end of the day, you’ll still be hungry."
–Michelle Chen, In These Times
And as Paul Krugman describes in his Friday column, readers who understand what is happening in the bill should not just be shocked or cynical about the Republican's latest attempt to "shrink" then "effectively kill" a key social program, they "should be very, very angry."
Krugman writes:

The shrinking part comes from the latest farm bill released by the House Agriculture Committee (for historical reasons, the food stamp program is administered by the Agriculture Department). That bill would push about two million people off the program. You should bear in mind, by the way, that one effect of the sequester has been to pose a serious threat to a different but related program that provides nutritional aid to millions of pregnant mothers, infants, and children. Ensuring that the next generation grows up nutritionally deprived — now that’s what I call forward thinking.
And why must food stamps be cut? We can’t afford it, say politicians like Representative Stephen Fincher, a Republican of Tennessee, who backed his position with biblical quotations — and who also, it turns out, has personally received millions in farm subsidies over the years.
These cuts are, however, just the beginning of the assault on food stamps. Remember, Representative Paul Ryan’s budget is still the official G.O.P. position on fiscal policy, and that budget calls for converting food stamps into a block grant program with sharply reduced spending. If this proposal had been in effect when the Great Recession struck, the food stamp program could not have expanded the way it did, which would have meant vastly more hardship, including a lot of outright hunger, for millions of Americans, and for children in particular.

Also addressing the assault on SNAP in a recent column, Michelle Chen lashed out at the GOP, saying conservative lawmakers are going a step further from their well-known “starve the beast” strategy "by trying to starve actual people."
And what's worse, explains Chen, is that the GOP rationale is a refusal of the realities that have caused the recent increase in food stamp assistance. She writes:

Ever since 2009, conservatives have been railing against the rapid expansion of the SNAP program as if it was a policy choice by Obama. (Recall Newt Gingrich’s endless invocations of the “food stamp president” during the 2012 GOP primary.)
But food stamp usage increased as a natural function of the steep recession, which created a lot more people who were eligible for the program. (In fact, Republican counties are responsible for most of the food stamp growth.) Republican demands to enact deep SNAP cuts, while crudely punitive to the millions of low-income Americans who depend on food stamps, are also unnecessary.

As economists repeatedly point out, food assistance programs like SNAP actually have a stimulative effect on the economy. As Krugman explains, "estimates from the consulting firm Moody’s Analytics suggest that each dollar spent on food stamps in a depressed economy raises G.D.P. by about $1.70 — which means, by the way, that much of the money laid out to help families in need actually comes right back to the government in the form of higher revenue."
And it gets worse. As The Nation's George Zornick recently reported:

[Cutting poverty assistance is] absurdly out of sync with economic realities of the working poor. (They’re also heaped on top of a current cut to food stamps due to the expiration of a temporary boost from the federal stimulus package.) Food Research and Action Center (FRAC) estimatesthat over one-sixth of the population faces hardship in securing an adequate food supply--with appalling rates of food insecurity among black and Latino households. And among those who can afford to keep their pantries stocked, many are still too poor to afford healthy, fresh food. Food stamps just dent that gap in food security, with monthly payments averaging a luxurious $280 per household.
For all the eagerness in Congress to shrink food stamps, the program’s problem is not that it helps too many, but that it reaches too few, as Monica Potts has reported. About one in four people who qualify for some reason do not receive benefits, according to federal estimates, perhaps due to stigma or bureaucratic barriers in the application process. Many immigrant families are also excluded due to their legal status.

And Chen's argues that the debate around SNAP provides a perfect symbol of the overall debate surrounding the nation's economy and ongoing budget negotiations.
"That millions of people can’t afford to eat is not a cause for alarm for politicians so much as a burdensome line item," writes Chen. And continues:

Erasing public benefits make it easier to make the poor invisible in the public mind. After all, food stamps symbolize not only the failure of “free markets” but the power of social policy to reduce endemic human suffering. For millions of Americans, that monthly food allowance is an unsavory reminder of the consequences of social disinvestment: no matter how hard you work, at the end of the day, you’ll still be hungry.

And for those lucky enough not yet starved of their political will, as Krugman urges, perhaps it's time to get "very, very angry" about the nature and substance of this lousy debate.

____________________________________________

This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License

True American Horror Story In Progress - In Two Parts

Published on The Nation (http://www.thenation.com)

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The Hollowing Out of America

Steve Fraser | December 3, 2012

This article originally appeared at TomDispatch.com
 
“Debtpocalypse [3]” looms. Depending on who wins out in Washington, we’re told [3], we will either free fall over the fiscal cliff or take a terrifying slide to the pit at the bottom. Grim as these scenarios might seem, there is something confected about the mise-en-scène, like an un-fun Playland. After all, there is no fiscal cliff [4], or at least there was none—until the two parties built it.
And yet the pit exists. It goes by the name of “austerity.” However, it didn’t just appear in time for the last election season or the lame-duck session of Congress to follow. It was dug more than a generation ago, and has been getting wider and deeper ever since. Millions of people have long made it their home. “Debtpocalypse” is merely the latest installment in a tragic, forty-year story of the dispossession of American working people.
Think of it as the archeology of decline, or a tale of two worlds. As a long generation of austerity politics hollowed out the heartland, the quants and traders and financial wizards of Wall Street gobbled up ever more of the nation's resources. It was another Great Migration—instead of people, though, trillions of dollars were being sucked out of industrial America and turned into “financial instruments” and new, exotic forms of wealth. If blue-collar Americans were the particular victims here, then high finance is what consumed them. Now, it promises to consume the rest of us.

Scenes from the Museum

In the mid-1970s, Hugh Carey, then governor of New York, was already noting the hollowing out of his part of America. New York City, after all, was threatening to go bankrupt. Plenty of other cities and states across what was then known as the “Frost Belt” were in similar shape. Yankeedom, in Carey’s words, was turning into “a great national museum” where tourists could visit “the great railroad stations where the trains used to run.”
As it happened, the tourists weren’t interested. Abandoned railroad stations might be fetching in an eerie sort of way, but the rest of the museum was filled with artifacts of recent ruination that were too depressing to be entertaining. True, a century earlier, during the first Gilded Age, the upper crust used to amuse itself by taking guided tours of the urban demi-monde, thrilling to sites of exotic depravity or ethnic strangeness. They traipsed around “rag-pickers alley” on New York’s Lower East Side or the opium dens of Chinatown, or ghoulishly watched poor children salivate over toys in store window displays they could never hope to touch.
Times have changed. The preference now is to entirely remove the unsightly. Nonetheless, the national museum of industrial homicide has, city by city, decade by decade, grown more grotesque.
Camden, New Jersey, for example, had long been a robust, diversified small industrial city. By the early 1970s, however, its reform mayor Angelo Errichetti was describing it this way:

It looked like the Vietcong had bombed us to get even. The pride of Camden…was now a rat-infested skeleton of yesterday, a visible obscenity of urban decay. The years of neglect, slumlord exploitation, tenant abuse, government bungling, indecisive and short-sighted policy had transformed the city’s housing, business, and industrial stock into a ravaged, rat-infested cancer on a sick, old industrial city.

That was forty years ago and yet, today, news stories are still being written [5] about Camden’s never-ending decline into some bottomless abyss. Consider that a measure of how long it takes to shut down a way of life.
Once upon a time, Youngstown, Ohio, was a typical smokestack city, part of the steel belt running through Pennsylvania and Ohio. As with Camden, things there started turning south in the 1970s. From 1977 to 1987, the city lost 50,000 jobs in steel and related industries. By the late 1980s, the years of Ronald Reagan’s presidency when it was “morning again in America [6],” it was midnight in Youngstown: foreclosures, an epidemic of business bankruptcies, and everywhere collapsing community institutions including churches, unions, families and the municipal government itself.
Burglaries, robberies and assaults doubled after the steel plants closed. In two years, child abuse rose by 21 percent, suicides by 70 percent. One-eighth of Mahoning County went on welfare. Streets were filled with dead storefronts and the detritus of abandoned homes: scrap metal and wood shingles, shattered glass, stripped-away home siding, canning jars and rusted swing sets. Each week, 1,500 people visited the Salvation Army’s soup line.
The Wall Street Journal called Youngstown “a necropolis,” noting miles of “silent, empty steel mills” and a pervasive sense of fear and loss. Bruce Springsteen would soon memorialize that loss in “The Ghost of Tom Joad [7].”
If you were unfortunate enough to live in the small industrial city of Mansfield, Ohio, for the last forty years, you would have witnessed in microcosm the dystopia of destruction unfolding in similar places everywhere. For a century, workshops there had made a kaleidoscope of goods: stoves, tires, steel, machinery, refrigerators and cars. Then Mansfield’s rust belt started narrowing as one plant after another went shut down: Dominion Electric in 1971, Mansfield Tire and Rubber in 1978, Hoover Plastics in 1980, National Seating in 1985, Tappan Stoves in 1986, a Westinghouse plant and Ohio Brass in 1990, Wickes Lumber in 1997, Crane Plumbing in 2003, Neer Manufacturing in 2007 and Smurfit-Stone Container in 2009. In 2010, General Motors closed its largest, most modern US stamping factory, and thanks to the Great Recession, Con-way Freight, Value City and Card Camera also shut down.
“Good times” or bad, it didn’t matter. Mansfield shrank relentlessly, becoming the urban equivalent of skin and bones. Its poverty rate is now at 28 percent [8], its median income $11,000 below the national average of $41,994. What manufacturing remains is non-union and $10 an hour is considered a good wage.
Midway through this industrial auto-da-fé, a journalist watching the Campbell Works of Youngstown Sheet and Tube go dark, mused that “the dead steel mills stand as pathetic mausoleums to the decline of American industrial might that was once the envy of the world.” This dismal record is particularly impressive because it encompasses the “boom times” presided over by Presidents Reagan and Clinton.

The “Pit” Deepens

In 1988, in the iciest part of the Frost Belt, a Wall Street Journal reporter noted, “There are two Americas now, and they grow further apart each day.” He was referring to Eastport, Maine. Although the deepest port on the East Coast, it hosted few ships, abandoned sardine factories lined its shore, and its bars were filled with the under- and unemployed. The reporter pointed out that he had seen similar scenes from a collapsing rural economy “coast to coast, border to border”: shuttered saw mills, abandoned mines, closed schools, rutted roads, ghost airports.
Closing up, shutting down, going out of business: last one to leave please turn out the lights!
Such was the case in cities and towns around the country. Essential public services—garbage collection, policing, fire protection, schools, street maintenance, healthcare—were atrophying. So were the people who lived in those places. High blood pressure, cardiac and digestive problems, and mortality rates were generally rising, as was doubt, self-blame, guilt, anxiety and depression. The drying up of social supports, even among those who once had been friends and workmates, haunted the inhabitants of these places as much as the industrial skeletons around them.
In the 1980s, when Jack Welch, soon to be known as “Neutron Jack [9]” for his ruthlessness, became CEO of General Electric, he set out to raise the company’s stock price by gutting the workforce. It only took him six years, but imagine what it was like in Schenectady, New York, which lost 22,000 jobs; Louisville, Kentucky, where 13,000 fewer people made appliances; Evendale, Ohio, where 12,000 no longer made lights and light fixtures; Pittsfield, Massachusetts, where 8,000 plastics makers lost their jobs; and Erie, Pennsylvania, where 6,000 locomotive workers got green slips.
Life as it had been lived in GE’s or other one-company towns ground to a halt. Two travelling observers, Dale Maharidge and Michael Williamson, making their way [10] through the wasteland of middle America in 1984 spoke of “medieval cities of rusting iron” and a largely invisible landscape filling up with an army of transients, moving from place to place at any hint of work. They were camped out under bridges, riding freight cars, living in makeshift tents in fetid swamps, often armed, trusting no one, selling their blood, eating out of dumpsters.
Nor was the calamity limited to the northern Rust Belt. The South and Southwest did not prove immune from this wasting disease either. Empty textile mills, often originally runaways from the North, dotted the Carolinas, Georgia and elsewhere. Half the jobs lost due to plant closings or relocations occurred in the Sunbelt.
In 2008, in the Sunbelt town of Colorado Springs, Colorado, one-third of the city’s street lights were extinguished, police helicopters were sold, watering and fertilizing in the parks was eliminated from the budget, and surrounding suburbs closed down the public bus system. During the recent Great Recession one-industry towns like Dalton [11], Georgia (“the carpet capital of the world”), or Blakely, Georgia (“the peanut capital of the world”), or Elkhart, Indiana [12] (“the RV capital of the world”), were closing libraries, firing police chiefs and taking other desperate measures to survive.
And no one can forget Detroit. Once, it had been a world-class city, the country’s fourth largest, full of architectural gems. In the 1950s, Detroit had a population with the highest median income and highest rate of home ownership in urban America. Now, the “motor city” haunts the national imagination as a ghost town [13]. Home to 2 million a quarter-century ago, its decrepit hulk is now “home” to 900,000. Between 2000 and 2010 alone, the population hemorrhaged by 25 percent, nearly a quarter of a million people, almost as many as live in post-Katrina New Orleans. There and in other core industrial centers like Baltimore, “death zones” have emerged where whole neighborhoods verge on medical collapse.
One-third of Detroit, an area the size of San Francisco, is now little more than empty houses, empty factories and fields gone feral. A whole industry of demolition, waste-disposal and scrap-metal companies arose to tear down what once had been. With a jobless rate of 29 percent, some of its citizens are so poor they can’t pay for funerals, so bodies pile up at mortuaries. Plans are even afoot to let the grasslands and forests take over, or to give the city to private enterprise.
Even the public zoo has been privatized. With staff and animals reduced to the barest of minimums and living wages endangered by its new owner, an associate curator working with elephants and rhinos went in search of another job. He found it with the city—chasing down feral dogs whose population had skyrocketed as the cityscape returned to wilderness. History had, it seemed, abandoned dogs along with their human compatriots.

Looking Backward

But could this just be the familiar story of capitalism’s penchant for “creative destruction”? The usual tale of old ways disappearing, sometimes painfully, as part of the story of progress as new wonders appear in their place?
Imagine for a moment the time traveler from Looking Backward [14], Edward Bellamy’s best-selling utopian novel of 1888 waking up in present-day America. Instead of the prosperous land filled with technological wonders and egalitarian harmony Bellamy envisioned, his protagonist would find an unnervingly familiar world of decaying cities, people growing ever poorer and sicker, bridges and roads crumpling, sweatshops a commonplace, the largest prison population on the planet, workers afraid to stand up to their bosses, schools failing, debts growing more onerous and inequalities starker than ever.
A recent grim statistic suggests just how Bellamy’s utopian hopes have given way to an increasingly dystopian reality. For the first time [15] in American history, the life expectancy of white people, men and women, has actually dropped. Life spans for the least educated, in particular, have fallen by about four years since 1990. The steepest decline: white women lacking a high school diploma. They, on average, lost five years of life, while white men lacking a diploma lost three years.
Unprecedented for the United States, these numbers come close to the catastrophic decline Russian men experienced in the desperate years following the collapse of the Soviet Union. Similarly, between 1985 and 2010, American women fell from fourteenth to forty-first place in the United Nation’s ranking of international life expectancy. (Among developed countries, American women now rank last.) Whatever combination of factors produced this social statistic, it may be the rawest measure of a society in the throes of economic anorexia.
One other marker of this eerie story of a developed nation undergoing underdevelopment and a striking reproach to a cherished national faith: for the first time since the Great Depression, the social mobility of Americans is moving in reverse [16]. In every decade from the 1970s on, fewer people have been able to move up the income ladder than in the previous ten years. Now Americans in their thirties earn 12 percent less on average than their parents’ generation at the same age. Danes, Norwegians, Finns, Canadians, Swedes, Germans and the French now all enjoy higher rates of upward mobility than Americans. Remarkably, 42 percent of American men raised in the bottom one-fifth income cohort remain there for life, as compared to 25 percent in Denmark and 30 percent in notoriously class-stratified Great Britain.

Eating Our Own

Laments about “the vanishing middle class” have become commonplace, and little wonder. Except for those in the top 10 percent of the income pyramid, everyone is on the down escalator [17]. The United States now has the highest percentage [18] of low-wage workers—those who earn less than two-thirds of the median wage—of any developed nation. George Carlin once mordantly quipped, “It’s called the American Dream because you have to be asleep to believe it.” Now, that joke has become our waking reality.
During the “long nineteenth century,” wealth and poverty existed side by side. So they do again. In the first instance, when industrial capitalism was being born, it came of age by ingesting what was valuable embedded in pre-capitalist forms of life and labor, including land, animals, human muscle power, tools and talents, know-how and the ways of organizing and distributing what got produced. Wealth accumulated in the new economy by extinguishing wealth in the older ones.
“Progress” was the result of this economic metabolism. Whatever its stark human and ecological costs, its achievements were also highly visible. America’s capacity to sustain a larger and larger population at rising levels of material well-being, education and health was its global boast for a century and half.
Shocking statistics about life expectancy and social mobility suggest that those days are over. Wealth, great piles of it, is still being generated, and sometimes displayed so ostentatiously that no one could miss it. Technological marvels still amaze. Prosperity exists, though for an ever-shrinking cast of characters. But a new economic metabolism is visibly at work.
For the last forty years, prosperity, wealth, and “progress” have rested, at least in part, on a grotesque process of auto-cannibalism—it has also been called “dis-accumulation” by David Harvey—of a society that is devouring its own.
Traditional forms of primitive accumulation still exist abroad. Hundreds of millions of former peasants, fisherman, craftspeople, scavengers, herdsmen, tradesmen, ranchers and peddlers provide the labor power and cheap products that buoy the bottom lines of global manufacturing and retail corporations, as well as banks and agribusinesses. But here in “the homeland,” the very profitability and prosperity of privileged sectors of the economy, especially the bloated financial arena, continue to depend on slicing, dicing and stripping away what was built up over generations.
Once again a new world has been born. This time, it depends on liquidating the assets of the old one or shipping them abroad to reward speculation in “fictitious capital.” Rates of US investment in new plants, technology, and research and development began declining during the 1970s, a fall-off that only accelerated in the gilded 1980s. Manufacturing, which accounted for nearly 30 percent of the economy after the Second World War, had dropped [19] to just over 10 percent by 2011. Since the turn of the millennium alone, 3.5 million more manufacturing jobs have vanished and 42,000 manufacturing plants were shuttered.
Nor are we simply witnessing the passing away of relics of the nineteenth century. Today, only one [20] American company is among the top ten in the solar power industry and the United States accounts for a mere 5.6 percent of world production of photovoltaic cells. Only GE is among the top ten companies in wind energy. In 2007, a mere 8 percent of all new semi-conductor plants under construction globally were located in the United States. Of the 1.2 billion cell phones sold in 2009, none were made in the United States. The share of semi-conductors, steel, cars and machine tools made in America has declined precipitously just in the last decade. Much high-end engineering design and R&D work has been offshored. Now, there are more people dealing cards in casinos than running lathes, and almost three times as many security guards as machinists.

The FIRE Next Time

Meanwhile, for more than a quarter of a century the fastest growing part of the economy has been the finance, insurance and real estate (FIRE) sector. Between 1980 and 2005, profits in the financial sector increased by 800 percent [21], more than three times the growth in non-financial sectors.
In those years, new creations of financial ingenuity, rare or never seen before, bred like rabbits. In the early 1990s, for example, there were a couple of hundred hedge funds; by 2007, 10,000 of them. A whole new species of mortgage broker roamed the land, supplanting old-style savings and loan or regional banks. Fifty thousand mortgage brokerages employed 400,000 brokers [22], more than the whole US textile industry. A hedge fund manager put it bluntly [23], “The money that’s made from manufacturing stuff is a pittance in comparison to the amount of money made from shuffling money around.”
For too long, these two phenomena—the eviscerating of industry and the supersizing of high finance—have been treated as if they had nothing much to do with each other, but were simply occurring coincidentally.
Here, instead, is the fable we’ve been offered: Sad as it might be for some workers, towns, cities, and regions, the end of industry is the unfortunate, yet necessary, prelude to a happier future pioneered by “financial engineers.” Equipped with the mathematical and technological know-how that can turn money into more money (while bypassing the messiness of producing anything), they are our new wizards of prosperity!
Unfortunately, this uplifting tale rests on a categorical misapprehension. The ascendancy of high finance didn’t just replace an industrial heartland in the process of being gutted; it initiated that gutting and then lived off it, particularly during its formative decades. The FIRE sector, that is, not only supplanted industry, but grew at its expense—and at the expense of the high wages it used to pay and the capital that used to flow into it.
Think back to the days of junk bonds, leveraged buy-outs, megamergers and acquisitions, and asset stripping in the 1980s and 1990s. (Think, in fact, of Bain Capital.) What was getting bought and stripped and closed up supported windfall profits in high-interest-paying junk bonds. The stupendous fees and commissions that went to those “engineering” such transactions were being picked from the carcass of a century and a half of American productive capacity. The hollowing out of the United States was well under way long before anyone dreamed up the “fiscal cliff.”
For some long time now, our political economy has been driven by investment banks, hedge funds, private equity firms, real estate developers, insurance goliaths and a whole menagerie of ancillary enterprises that service them. But high times in FIRE land have depended on the downward mobility of working people and the poor, cut adrift from more secure industrial havens and increasingly from the lifelines of public support. They have been living instead in the “pit of austerity.” Soon many more of us will join them.

For Footnotes, go to http://www.thenation.com/print/article/171563/hollowing-out-america

Part 2.
http://www.thenation.com/blog/171500/what-ceos-lobbying-fiscal-cliff-really-want

What the CEOs Lobbying on the Fiscal Cliff Really Want

George Zornick on November 28, 2012 - 3:48 PM ET

CEOs from several big corporations meet with House Republican leaders on November 28, 2012, in Washington. Photo courtesy of the Office of the Majority Whip.
A merry band of corporate executives is zig-zagging Washington today, meeting with almost every principal player in the “fiscal cliff” negotiations. The CEOs are meeting with administration officials at the White House, with House Speaker John Boehner, and with House Minority Leader Nancy Pelosi.
According to most press accounts, these business titans are “pressing for a solution to the so-called fiscal cliff” (Bloomberg), while “touting the virtue of bipartisanship and shared sacrifice” (The Washington Post).
But what’s important to understand—what every press account of these meetings should note—is that they’re not, in practice, proposing any sacrifice from their companies in particular nor their industries in general.
Key planks of their proposals, explicitly articulated by the Fix the Debt campaign and other industry coalitions pushing for a deal, include a lower corporate tax rate—even though many of these companies pay little or no corporate taxes as it is. Then there’s a territorial tax system, which would allow corporations that have profits parked overseas to bring them back home without paying any taxes. (Right now, they’d be obligated to pay the normal 35 percent corporate tax on those profits if they were repatriated). Some, but not all, of the CEOs also want the Bush tax rates extended for all earners.
That’s not exactly “shared sacrifice.” A report from the Institute for Policy Studies notes that the 63 CEOs behind “Fix the Debt” would reap $134 billion in tax windfalls for their companies just from a territorial tax system alone. That naturally would increase, not decrease, the deficit, so somebody’s got to pay—hence the Very Serious pleas to “reform” Medicare and Social Security.
“These CEOs paint a stark picture of hypocrisy,” said Scott Klinger, co-author of that IPS report, in a statement. “They’re simply taking advantage of the so-called ‘fiscal cliff’ to push the same old agenda of more corporate tax breaks while shifting costs onto the poor and elderly.”
To put a finer point on it, here is what the nine CEOs tooling around Washington today stand to gain in the fiscal cliff negotiations—how much their company would gain from a territorial tax system, and how much the individual CEO would gain if the Bush rates on top earners are extended.
The figures on taxable CEO compensation and unrepatriated offshore earnings are from that excellent IPS report, unless the company was not included. (It detailed only members of “Fix the Debt.”) In that case, I consulted the company’s SEC filings, and linked to it. The effective tax rate figures are either from this Citizens for Tax Justice report, or if it wasn’t included, from other sources which are also linked. (See a more detailed breakdown below the infographic.)

Ken Frazier, CEO, Merck & Co.
Merck’s unrepatriated offshore earnings: $44.3 billion
Estimate windfall from territorial tax system: $15.5 billion
Merck’s effective corporate tax rate from 2008-2010 (standard is 35 percent): 11.5 percent
Frazier’s 2011 taxable compensation: $5.4 million
Frazier’s yearly savings if top Bush rates are extended: $237,352
Muhtar Kent, CEO, Coca-Cola
Coca-Cola’s unrepatriated offshore earnings: $23.5 billion
Estimate windfall from territorial tax system: $8.2 billion
Coca-Cola’s effective corporate tax rate from 2008-2010 (standard is 35 percent): 14.1 percent
Kent’s 2011 taxable compensation: n/a
Kent’s yearly savings if top Bush rates are extended: —
Douglas Oberhelman, CEO, Caterpillar Inc.
Caterpillar’s unrepatriated offshore earnings: $13 billion
Estimate windfall from territorial tax system: $4.55 billion
Caterpillar’s 2011 effective corporate tax rate (standard is 35 percent): 25.6 percent
Oberhelman’s 2011 taxable compensation: $10.2 million
Oberhelman’s yearly savings if top Bush rates are extended: $459.851
Marissa Mayer, CEO, Yahoo! Inc.
Yahoo’s unrepatriated offshore earnings: $3.2 billion
Estimate windfall from territorial tax system: $1.12 billion
Yahoo’s three-year effective corporate tax rate from 2008-2010 (standard is 35 percent): 8.7 percent
Mayer’s 2011 taxable compensation: n/a
Mayer’s yearly savings if top Bush rates are extended: —
Thomas Wilson, CEO, Allstate
Allstate’s unrepatriated offshore earnings: $0
Estimate windfall from territorial tax system: $0
Allstate’s 2011 effective corporate tax rate (standard is 35 percent): 17.9 percent
Wilson’s 2011 taxable compensation: $4.1 million
Wilson’s yearly savings if top Bush rates are extended: $175,793
Lloyd Blankfein, CEO, Goldman Sachs
Goldman Sachs’ unrepatriated offshore earnings: $20.6 billion
Estimate windfall from territorial tax system: $3.3 billion
Goldman Sachs’  effective corporate tax rate 2008-2010 (standard is 35 percent) 20.8 percent
Blankfein’s 2011 taxable compensation: $15.6 million
Blankfein’s yearly savings if top Bush rates are extended: $706,104
David Cote, CEO, Honeywell International
Honeywell’s unrepatriated offshore earnings: $8.1 billion
Estimate windfall from territorial tax system: $2.8 billion
Honeywell’s effective corporate tax rate 2008-2010 (standard is 35 percent) -0.7 percent
Cote’s 2011 taxable compensation: $55.2 million
Cote’s yearly savings if top Bush rates are extended: $2.5 million
Mark Bertolini, CEO, Aetna
Aetna’s unrepatriated offshore earnings: $0
Estimate windfall from territorial tax system: $0
Aetna’s effective corporate tax rate 2008-2010 (standard is 35 percent) 28.8 percent
Bertolini’s 2011 taxable compensation: $9.5 million
Cote’s yearly savings if top Bush rates are extended: $423,208
Frank Blake, CEO, Home Depot
Home Depot’s unrepatriated offshore earnings: $2.4 billion
Estimate windfall from territorial tax system: $8.4 million
Home Depot’s effective corporate tax rate 2008-2010 (standard is 35 percent) 35.6
Blake’s 2011 taxable compensation: n/a
Blake’s yearly savings if top Bush rates are extended: n/a

Notably, none of the corporations represented in Washington today except Home Depot actually paid anything close to the corporate tax rate of 35 percent. Most would benefit handsomely from a territorial tax system, though not all—the interests of these companies don’t always align perfectly. Some, like Honeywell and Yahoo!, wouldn’t gain anything from reductions to Medicare and Social Security—the demands from those CEOs to cut spending on those programs is perhaps nothing more than a cover for their windfalls elsewhere. Others, like Goldman Sachs and Aetna, surely would benefit from a reduction in these programs.
What’s clear, though, is that the sacrifice preached by these CEOs is most certainly one-sided.

Todays Welfare Queens and Their Gigantic Destructive Enonomic Impact

This article represents some of the best and most relevant economic reporting by anyone in years!

I hope the NYT will promote this series of articles indefinitely, to a wide audience at no charge as a National Public Service.

I just can't express how impressed I am!

Government really needs to have the guts to put a stop to this corporate welfare scheme and begin to support their own people and small business that have local roots and a personal incentive to stay put and prosper over the long haul.

As the article demonstrates, much of these huge subsidies go directly to executive income and bonuses and are not relevant to any actual business costs or benefit to workers or the community.

By the way, the Green Party proposed a jobs plan that encouraged a rational investment in local, small business and education that would eliminate unemployment right away and undo the harm caused by these fear-mongering, money-grabbing, anti-American Corporations and the Politicians who serve them.  Find their proposals on the Green Party Webpage.

Thank you New York Times!

I was blown away by Michigan's extensive list of Corporate Welfare Queens - topped by General Motors.
All states are explored in this Corporate Welfare Map. Michigan spends 30% of it's State Budget on Corporate Welfare with no promise of any benefit to the state and very often a very obvious loss as corporations fail, relocate or take other actions to improve their bottom line at the expense of...well...anything.

Check out the State by State Map (click on a state for an extensive, ranked list of Corporations benefiting from these "incentives")  http://www.nytimes.com/interactive/2012/12/01/us/government-incentives.html?smid=FB-nytimes&WT.mc_id=US-E-FB-SM-PIX-USO-120212-NYT-NA&WT.mc_ev=click&_r=0

As Companies Seek Tax Deals, Governments Pay High Price
Fred R. Conrad/The New York Times
http://www.nytimes.com/2012/12/02/us/how-local-taxpayers-bankroll-corporations.html?smid=FB-nytimes&WT.mc_id=US-E-FB-SM-LIN-ACS-120212-NYT-NA&WT.mc_ev=click

In the end, the money that towns across America gave General Motors did not matter.

When the automaker released a list of factories it was closing during bankruptcy three years ago, communities that had considered themselves G.M.’s business partners were among the targets.

For years, mayors and governors anxious about local jobs had agreed to G.M.’s demands for cash rewards, free buildings, worker training and lucrative tax breaks. As late as 2007, the company was telling local officials that these sorts of incentives would “further G.M.’s strong relationship” with them and be a “win/win situation,” according to town council notes from one Michigan community.

Yet at least 50 properties on the 2009 liquidation list were in towns and states that had awarded incentives, adding up to billions in taxpayer dollars, according to data compiled by The New York Times.

Some officials, desperate to keep G.M., offered more. Ohio was proposing a $56 million deal to save its Moraine plant, and Wisconsin, fighting for its Janesville factory, offered $153 million.

But their overtures were to no avail. G.M. walked away and, thanks to a federal bailout, is once again profitable. The towns have not been so fortunate, having spent scarce funds in exchange for thousands of jobs that no longer exist.

One township, Ypsilanti, Mich., is suing over the automaker’s departure. “You can’t just make these promises and throw them around like they’re spare change in the drawer,” said Doug Winters, the township’s attorney.

Yet across the country, companies have been doing just that. And the giveaways are adding up to a gigantic bill for taxpayers.

A Times investigation has examined and tallied thousands of local incentives granted nationwide and has found that states, counties and cities are giving up more than $80 billion each year to companies. The beneficiaries come from virtually every corner of the corporate world, encompassing oil and coal conglomerates, technology and entertainment companies, banks and big-box retail chains.

The cost of the awards is certainly far higher. A full accounting, The Times discovered, is not possible because the incentives are granted by thousands of government agencies and officials, and many do not know the value of all their awards. Nor do they know if the money was worth it because they rarely track how many jobs are created. Even where officials do track incentives, they acknowledge that it is impossible to know whether the jobs would have been created without the aid.

“How can you even talk about rationalizing what you’re doing when you don’t even know what you’re doing?” said Timothy J. Bartik, a senior economist at the W.E. Upjohn Institute for Employment Research in Kalamazoo, Mich.

The Times analyzed more than 150,000 awards and created a searchable database of incentive spending. The survey was supplemented by interviews with more than 100 officials in government and business organizations as well as corporate executives and consultants.

A portrait arises of mayors and governors who are desperate to create jobs, outmatched by multinational corporations and short on tools to fact-check what companies tell them. Many of the officials said they feared that companies would move jobs overseas if they did not get subsidies in the United States.

Over the years, corporations have increasingly exploited that fear, creating a high-stakes bazaar where they pit local officials against one another to get the most lucrative packages. States compete with other states, cities compete with surrounding suburbs, and even small towns have entered the race with the goal of defeating their neighbors.

While some jobs have certainly migrated overseas, many companies receiving incentives were not considering leaving the country, according to interviews and incentive data.

“If you’re looking at the competitiveness of a region, the most important thing a region can do is to focus on education. And this use of incentives is really transferring money from education to businesses.”

Donald J. Hall Jr., Hallmark C.E.O.

Despite their scale, state and local incentives have barely been part of the national debate on the economic crisis. The budget negotiations under way in Washington have not addressed whether the incentives are worth the cost, even though 20 percent of state and local budgets come from federal spending. Lawmakers in Washington are battling over possible increases in personal taxes, while both parties have said that lower federal taxes on corporations are needed for the country to compete globally.

The Times analysis shows that Texas awards more incentives, over $19 billion a year, than any other state. Alaska, West Virginia and Nebraska give up the most per resident.

For many communities, the payouts add up to a substantial chunk of their overall spending, the analysis found. Oklahoma and West Virginia give up amounts equal to about one-third of their budgets, and Maine allocates nearly a fifth.

In a few states, the cost of incentives is not significant. But several of them have low business taxes — or none at all — which can save companies even more money than tax credits.

Far and away the most incentive money is spent on manufacturing, about $25.5 billion a year, followed by agriculture. The oil, gas and mining industries come in third, and the film business fourth. Technology is not far behind, as companies like Twitter and Facebook increasingly seek tax breaks and many localities bet on the industry’s long-term viability.

Those hopes were once more focused on automakers, which for decades have pushed cities and states to set up incentive programs, blazing a trail that companies of all sorts followed. Even today, G.M. is the top beneficiary, public records indicate. It received at least $1.7 billion in local incentives in the last five years, followed closely by Ford and Chrysler.

A spokesman for General Motors said that almost every major employer applied for incentives because they help keep companies competitive and retain or create jobs.

“There are many reasons why so many Ford, Chrysler and G.M. plants closed over the last few decades,” said the G.M. spokesman, James Cain. “But these factors don’t mean that the companies and communities didn’t benefit while the plants were open, which was often for generations.”

Mr. Cain cited research showing that the company received less money per job than foreign automakers operating in the United States.

Questioned about incentives, officials at dozens of other large corporations said they owed it to shareholders to maximize profits. Many emphasized that they employ thousands of Americans who pay taxes and spend money in the local economy.

$9.1 million - Amount local governments give up for business incentives every hour

$80 billion+ - Amount local governments give up to businesses every year

For government officials like Bobby Hitt of South Carolina, the incentives are a good investment that will raise tax revenues in the long run.

“I don’t see it as giving up anything,” said Mr. Hitt, who worked at BMW in the 1990s and helped it win $130 million from South Carolina.

Today, Mr. Hitt is the state’s secretary of commerce. South Carolina recently took on a $218 million debt to assist Boeing’s expansion there and offered the company tax breaks for 10 years.

Mr. Hitt, like most political officials, has a short-term mandate. It will take years to see whether the state’s bet on Boeing bears fruit.

In Michigan, Gov. Rick Snyder, a Republican in his first term, has been working to eliminate most business tax credits but is bound by past awards. The state gave General Motors $779 million in credits in 2009, just a month after the company received a $50 billion federal bailout and decided to close seven plants in Michigan.

G.M. can use the credits to offset its state tax bill for up to 20 years. “You don’t know who will take a credit or when,” said Doug Smith, a senior official at the state’s economic development agency. “We may give a credit to G.M., and they might not take it for three years or 10 years or more.”

One corporate executive, Donald J. Hall Jr. of Hallmark, thinks business subsidies are hurting his hometown, Kansas City, Mo., by diverting money from public education. “It’s really not creating new jobs,” Mr. Hall said. “It’s motivated by politicians who want to claim they have brought new jobs into their state.”

For Mr. Hall and others in Kansas City, the futility of free-flowing incentives has been underscored by a border war between Kansas and Missouri.

Soon after Kansas recruited AMC Entertainment with a $36 million award last year, the state cut its education budget by $104 million. AMC was moving only a few miles, across the border from Missouri. Workers saw little change other than in commuting times and office décor. A few months later, Missouri lured Applebee’s headquarters from Kansas.

“I just shake my head every time it happens, it just gives me a sick feeling in the pit of my stomach,” said Sean O’Byrne, the vice president of the Downtown Council of Kansas City. “It sounds like I’m talking myself out of a job, but there ought to be a law against what I’m doing.”

Outgunned by Companies

For local governments, incentives have become the cost of doing business with almost every business. The Times found that the awards go to companies big and small, those gushing in profits and those sinking in losses, American companies and foreign companies, and every industry imaginable.

Workers are a vital ingredient in any business, yet companies and government officials increasingly view the creation of jobs as an expense that should be subsidized by taxpayers, private consultants and local officials said.

Even big retailers and hotels, whose business depends on being in specific locations, bargain for incentives as if they can move anywhere. The same can be said for many movie productions, which almost never come to town without local subsidies.

When Oliver Stone made the 2010 sequel to “Wall Street,” in his mind there was only one place to shoot it: New York City. Nonetheless, the film, a scathing look at bankers’ greed, received $10 million in tax credits, according to 20th Century Fox.

In an interview, Mr. Stone criticized subsidies for industries like banking and agriculture but defended them for Hollywood, saying that many movies can be shot anywhere and that their actors and crew members pay state income taxes. “It’s good,” Mr. Stone said of the film subsidies. “Or like basically the way business is done. I don’t understand what the moral qualm is.”

The practical consequences can be easily seen. The Manhattan Institute for Policy Research, a conservative group, found that the amount New York spends on film credits every year equals the cost of hiring 5,000 public-school teachers.

Nationwide, billions of dollars in incentives are being awarded as state governments face steep deficits. Last year alone, states cut public services and raised taxes by a collective $156 billion, according to the Center on Budget and Policy Priorities, a liberal-leaning advocacy group.

Incentives come in many forms: cash grants and loans; sales tax breaks; income tax credits and exemptions; free services; and property tax abatements. The income tax breaks add up to $18 billion and sales tax relief around $52 billion of the overall $80 billion in incentives.

Collecting data on property tax abatements is the most difficult because only a handful of states track the amounts given by cities and counties. Among them is New York, where businesses save an estimated $1.1 billion a year in property taxes. The American International Group, the insurance company at the center of the 2008 financial crisis, continued to benefit from a $23.8 million abatement from New York City at the same time it was being bailed out with $180 billion in federal money.

Since 2000, The New York Times Company has received more than $24 million from the city and state.

“The management owes it to their stockholders to try to get the best economic deal that they can.”

Marilyn P. Nix, former G.M. real estate manager

In some places, local officials have little choice but to answer the demands of corporations.

“They dictate their terms, and we’re not really in a position to question their deal terms,” Sarah Eckhardt, a commissioner in Travis County, Tex., said of companies she has dealt with recently, including Apple and Hewlett-Packard. “We don’t have the sophistication or the resources to negotiate with a company that has the wherewithal the size of a country. We are just no match in negotiating with that.”

Local officials can find themselves across the table from conglomerates like Shell Oil and Caterpillar, the world’s largest maker of construction equipment.

Shell has been offered a tax credit worth as much as $1.6 billion over 25 years from Pennsylvania, which competed with West Virginia and Ohio for an energy production facility. Royal Dutch Shell, the parent company, made $31 billion in profits in 2011 — about $3.5 million every hour. The company’s chief executive made $13.1 million last year, according to Equilar, an executive compensation firm. Pennsylvania predicts that the plant will create thousands of long-term jobs, but it did not require them in exchange for the tax credit.

Caterpillar has received more than $196 million in local aid nationwide since 2007, though it has chastised states, particularly its home base, Illinois, for not being business-friendly. This year, Caterpillar announced a new plant in Georgia, which offered $44 million in incentives. Local counties chipped in free land and other aid, including $15 million in tax breaks and $8.2 million in road, water and sewer repairs.

The company, whose profits are soaring, recently froze workers’ pay for six years at several locations, arguing that it needed to remain competitive. A spokesman for the company, Jim Dugan, said it employed more than 50,000 people and invested billions of dollars nationwide.

Local officials typically have scant information about the track record of corporations, like whether they lived up to job assurances elsewhere. And some officials acknowledged that they did not know to what extent incentives were a deciding factor for companies.

“I don’t know that there’s a way to know other than talking to the businesses, and the businesses telling us that that was a factor in creating jobs,” said Ken Striplin, the city manager of Santa Clarita, Calif., which gives tax breaks in a designated enterprise zone. “There’s no box that says ‘I would have created this job without the enterprise zone.’ ”

California is one of the few states that have been cutting back on incentives. But that does not mean its cities are following suit. When Twitter threatened to leave San Francisco last year, officials scrambled to assuage the company.

$170 billion - Combined amount federal and state governments give up for incentives

Twitter was not short on money — it soon received a $300 million investment from a Saudi prince and $800 million from a private consortium. The two received Twitter equity, but San Francisco got a different sort of deal.

The city exempted Twitter from what could total $22 million in payroll taxes, and the company agreed to stay put. The city estimates that Twitter’s work force could grow to 2,600 employees, although the company made no such promise.

A Twitter spokeswoman said the company was “very happy to have been able to stay in San Francisco.” City officials did not respond to inquiries.

Like many places, San Francisco has been cutting its budget. Public parks have lost about $12 million in recent years, though workers at Twitter will not lack for greenery. The company’s plush new office has a rooftop garden with great views and amenities. Enjoying the perks, one employee sent out a tweet: “Tanned on Twitter’s new roof deck this morning as some dude served me smoothie shots. This is real life?”

A Zero-Sum Game

It was the company every state had to have. In 1985, General Motors was looking for a spot to manufacture its Saturn, a new compact car that would compete with Japanese imports and create thousands of American jobs.

Incentives were not in wide use, and several states had only recently begun to allow more of them.

In fact, when G.M. announced the search, its chairman, Roger Smith, said the perks would not be a predominant factor. “Tax breaks can’t make a silk purse out of a sow’s ear,” Mr. Smith told The Detroit Free Press. He said G.M. planned to avoid states that had large debts or lackluster schools.

Undeterred, some 30 states stepped forward in what became a full-out competition. One official, Bill Clinton, then the governor of Arkansas, traveled to Detroit offering income tax credits and sales tax exemptions worth nearly $200 million.

Mr. Smith essentially kept his word and chose Tennessee, which had put together a relatively small package. Reid Rundell, a retired G.M. executive, said in a recent interview that it had come down to geography. “The primary factor was distribution for incoming parts, as well as outgoing vehicles,” Mr. Rundell said.

But the gates had been opened. In 1992, South Carolina lured BMW with a $130 million package; the next year, Alabama got Mercedes-Benz at a price tag that topped $300 million.

“What the auto incentives did back then was really raise the profile of economic incentives both within companies, in government and in the public’s eye,” said Mark Sweeney, who worked for the South Carolina Commerce Department in the 1990s and now advises companies on obtaining government grants.

By 1993, governors were regaling one another at a national conference with stories of deals beyond the auto industry, including a recent bidding war for United Airlines that drew more than 90 cities. The airline had set up negotiations in a hotel, and its representatives ran floor to floor comparing bids, said Jim Edgar, then the governor of Illinois.

Mr. Edgar said he had called for a truce, concerned that the practice was unfair to companies that did not receive incentives. But many states would not sign on, he said, particularly those in the South, where businesses were moving.

“If you’ve got some states doing it, it’s hard for the others not to do it,” Mr. Edgar said. “It’s like unilaterally disarming.”

Soon after, economists at Federal Reserve branches were questioning the use of incentives. One, in Minnesota, used mathematical proofs and game theory to show that competition between states did not increase overall economic value. Several other economists have since called the practice a zero-sum game.

A group of taxpayers in Michigan and Ohio went as far as suing DaimlerChrysler after Ohio and the City of Toledo awarded the automaker $280 million in the late 1990s. The suit argued that it was unfair for one taxpayer to be given a break at the expense of all others.

The suit made its way to the Supreme Court, and G.M. and Ford signed on to briefs supporting Daimler, as did local governments. The National Governors Association warned the court that prohibiting incentives could lead to jobs moving overseas. “This is the economic reality,” the association said in a brief.

The governors offered no hard evidence of the effectiveness of tax credits, but the Supreme Court did not consider whether they worked anyway. In 2006, the court concluded that the taxpayers did not have the legal standing to challenge Ohio’s tax actions in federal court.

The tab for auto incentives has grown to $13.9 billion since 1985, according to the Center for Automotive Research, a nonprofit group in Ann Arbor, Mich. G.M., the top recipient, was awarded $3.3 billion of the aid. Since 1979, automakers also closed more than 267 plants in the United States, about half of which still sit empty, according to the center.

The auto industry and some local officials have long argued that auto companies create so many jobs and draw in so many supporting suppliers that all taxpayers benefit. Even if companies shut down years later, as Saturn did in Tennessee for a few years, the trade-off is worth it, they said.

“I do believe that if a state ever is going to create incentives,” said Lamar Alexander, who was Tennessee’s governor in 1985 when Saturn selected the state, “the auto industry would be by far the No. 1 target, because an auto assembly plant is a money target.”

Still, Mr. Alexander, now a United States senator, said that recruiting a large factory today would be more expensive. “It has changed a lot,” he said. “It’s almost become a sweepstakes.”

G.M. Gets Into the Act

G.M. may have initially minimized the role of local dollars, but as the company’s financial problems grew, incentives became a big part of its math.

“These economic development deals with a company just serve to guarantee that the nation’s largest companies can receive tax breaks wherever they go.”

Sarah Eckhardt, county commissioner, Travis County, Texas

The actions of the company were described in more than two dozen in-depth interviews with former company officials, tax consultants and governors and mayors who have dealt with G.M.

The automaker’s real estate division, Argonaut Realty, oversaw the hunt for the most lucrative deals. Up and down the corporate ladder, employees were encouraged to push governments for more, according to transcripts of public meetings and interviews. Even G.M. plant managers knew that the future of their facilities depended in part on their ability to send word of big discounts back to Detroit.

Union representatives were enlisted to attend local hearings, putting a human face on the jobs at stake. G.M.’s regional tax managers often showed up, armed with tax abatement wish lists and highlighting the company’s gifts to local charities.

“We knew what our investment of X amount meant to the community, and we knew we needed to partner with the community to be successful,” said Marilyn P. Nix, who worked as a real estate executive at G.M. for 31 years until retiring in 2005.

At the top of G.M., executives reviewed the proposals from various locations and went where the numbers added up.

“I know people like to blame the industry for taking advantage of the incentives, but you go back to what your fiduciary responsibility is to the stockholders,” Ms. Nix said. “As long as you’ve got people that are willing to better the deals, the management owes it to their stockholders to try to get the best economic deal that they can.”

For towns, it became a game of survival, even if the competition turned out to be a mirage.

Moraine, Ohio, was already home to a G.M. plant in 1997 when the company pushed hard for additional incentives. G.M. said it was looking for a place to accommodate more manufacturing.

Wayne Barfels, the city manager at the time, said a G.M. representative had told officials that Moraine was competing with Shreveport, La., and Linden, N.J. After the local school board approved property tax breaks, The Dayton Daily News reported that the other towns had not been in discussions with G.M.

The school board considered rescinding the deal, but allowed G.M. to keep it after a company official apologized. In 2008, G.M. shut the Moraine facility.

In towns where General Motors remains, local officials praised the company. “I can say they have been a great partner to us,” said Virg Bernero, the mayor of Lansing, Mich. “It would do something to the psyche of this community if they were not here. I mean, I just praise God every day.”

100 - Percentage of years since 1995 that General Motors got local incentives

The company was awarded incentives in at least 16 states

Looking to lure businesses beyond automakers, states have routinely bolstered their incentive tool kits. In 2010 alone, states created or expanded about 40 tax credits and exemptions, according to the National Conference of State Legislatures.

The nature of the credits has also changed. New ones are geared toward attracting technology and green energy companies, but it is hard to know whether 15 years down the road they will thrive or wind up stumbling like the automakers. And many modern companies, like those in digital technology, can easily pack up and leave.

“I don’t see anything that suggests that Twitter and Facebook are better bets in the long run,” said Laura A. Reese, the director of the Global Urban Studies Program at Michigan State University. Ms. Reese advises local governments to invest in residents through education and training rather than in companies where “it’s hard to pick winners.”

Yet states try to do it all the time. In 2010, Rhode Island, which has the nation’s second-highest unemployment rate, recruited Curt Schilling, a former Red Sox pitcher, to move his video game company from Massachusetts. The company, 38 Studios, had never released a game and was not making money, but the governor at the time had the state guarantee $75 million in loans.

The company failed and dismissed all of its roughly 400 workers this May. Rhode Island taxpayers are now on the hook for the loans.

Officials said part of the difficulty was that communities do not get much say in a company’s business strategy.

“We, as communities, stake our futures with these people who are supposed to know what they’re doing, and sometimes they don’t,” said Arthur Walker, a businessman in Shreveport and former chairman of the city’s chamber of commerce.

Mr. Walker and other officials in Shreveport know firsthand. In 2000, they were worried that G.M. would close a plant in their area and responded with a generous proposal: the city would cut the company’s gas bill and provide work force training grants. In addition, G.M. would benefit by a recent increase in one of the state’s income tax credits.

Eager to encourage innovation, Shreveport officials suggested ways the city could assist G.M. in building electric cars. “We wanted to be part of the future,” said Mr. Walker, whose brother worked at the plant.

G.M. took the city’s incentives but not its business advice and began building the giant Hummer there.

“We knew they needed to build green cars — I mean, who builds a Hummer for the 21st century?” Mr. Walker said. “It was a losing proposition that we found ourselves in. We couldn’t win because those people weren’t making the correct business decisions, in my view. When it didn’t work, we’re the ones left holding the bag.”

The Hummer was discontinued in 2010, and the Shreveport factory closed this August, the final victim of G.M.’s bankruptcy.

Ypsilanti’s Losing Battle

For much of the last 20 years, Doug Winters has been agitating for General Motors to be held accountable.

Mr. Winters, the attorney for Ypsilanti Township and several other places around Ann Arbor, has lived in Ypsilanti all his life. His grandmother labored at the local plant, Willow Run, during World War II, when it made bomber planes. People in town still proudly point out that a woman known as Rosie the Riveter worked there as well. After the war, when G.M. moved into the plant to manufacture its automatic transmission system, his father got a job.

Mr. Winters loves the history of Willow Run but hates what he views as corporate hypocrisy: G.M. asked for government help on the one hand and then appealed to free-market rationales for closing shop.

Over the years, Ypsilanti granted G.M. more than $200 million in incentives for two factories at Willow Run, Mr. Winters said. “They had put basically a stranglehold on the entire state of Michigan and other places across the country by just grabbing these tax abatements by the billions,” he said. “They were doing it with a very thinly disguised threat that if you don’t give us these tax abatements, then we’ll have to go somewhere else.”

“We’re their own private ATM. When they need money, they come begging, but when they don’t want oversight, they say ‘get out of the way.’”

Doug Winters, attorney for Ypsilanti Township, Mich.

Ypsilanti first sued G.M. in the 1990s to prevent the company from closing the factory at Willow Run that made the Chevrolet Caprice.

The town had granted the company tax incentives after the factory manager argued that G.M.’s ability to compete with other carmakers was at stake, documents in the lawsuit show. The tax break and “favorable market demand,” said the plant manager, Harvey Williams, would allow the automaker to “maintain continuous employment.”

Nevertheless, G.M. shut the factory. A lower court found in favor of Ypsilanti, but the ruling was reversed on appeal. The judge said that a company’s job assurances “cannot be evidence of a promise.”

In 2010, when the company closed the remaining factory at Willow Run, Mr. Winters sued again. This time, Ypsilanti argued that the automaker should have been forced to close overseas factories instead, especially since American taxpayers had bailed out G.M. In addition, Ypsilanti sought to recover money from G.M., saying the company had agreed to reimburse the town for some incentives if it left.

So far, Ypsilanti’s claims have not been addressed. They were complicated by G.M.’s bankruptcy, which allowed the carmaker to emerge as a new company and leave some of its liabilities and contractual obligations behind.

When asked whether the new G.M. has civic responsibilities to its former factory towns, Mr. Cain, the company spokesman, said: “Our obligation to the communities where we do business is to run a successful business. And when we prosper, it allows us to do more than just turn the lights on and make cars.”

He also said that since the bailout, “G.M. has invested more than $7.3 billion in its U.S. facilities, and we’ve created or retained almost 19,000 jobs in communities all over the country.”

Matthew P. Cullen, who oversaw real estate and economic development for G.M. until he left the company in 2008, said the automaker was aware of its impact on communities. He said that what happened with G.M. was the result of an entire industry changing and that there had been no bad intentions.

“If you go forward in good faith doing everything you can and make the investment, then you’re partners,” Mr. Cullen said. “Sometimes partnerships in business work, and they work for 60 years. And in some cases, they don’t, and it doesn’t make you a bad partner.”

Some towns that are still dealing with the fallout of plant closings might disagree. In Pontiac, Mich., tax revenues have fallen 40 percent since 2009 after the old G.M. knocked down buildings on its property, resulting in lower tax assessments, according to the city’s emergency manager.

In Ypsilanti, an entity set up to sell off G.M. property is marketing the plant as valuable. At the same time, it has been arguing for lower property taxes on the grounds that its plant is not worth much.

Ypsilanti’s supervisor, Brenda Stumbo, said the township would be stung hard by further revenue cuts. Ypsilanti has already slimmed down its Fire Department, and city workers are juggling multiple jobs. There are seven to 10 home foreclosures a week, giving the township the highest foreclosure rate in the county, Ms. Stumbo said.

“Can all of it be traced back to General Motors?” she said, listing auto suppliers that closed after G.M. did. “No, but a great deal of it can.”

Nonetheless, Ms. Stumbo said that if G.M. would bring jobs back to town, she would be willing to grant the company more incentives.

But Mr. Winters is not so sure. He said he would never support more incentives without stronger protections for Ypsilanti. “They’ve done a lot of damage to a lot of people and a lot of communities, and they’ve basically been given a clean slate,” he said. “It’s a ‘get out of jail free’ card.”

Lisa Schwartz and Ramsey Merritt contributed research.

louise@nytimes.com, @louisestory

I Was a Warehouse Wage Slave

This story ran in the March/April 2012 issue of Mother Jones, under the headline "Shelf Lives."

My brief, backbreaking, rage-inducing, low-paying, dildo-packing time inside the online-shipping machine.

By Mac McClelland on Mon. February 27, 2012 3:00 AM PDT

Illustration by Mark Matcho

"Don't take anything that happens to you there personally," the woman at the local chamber of commerce says when I tell her that tomorrow I start working at Amalgamated Product Giant Shipping Worldwide Inc. She winks at me. I stare at her for a second.
"What?" I ask. "Why, is somebody going to be mean to me or something?"
She smiles. "Oh, yeah." This town somewhere west of the Mississippi is not big; everyone knows someone or is someone who's worked for Amalgamated. "But look at it from their perspective. They need you to work as fast as possible to push out as much as they can as fast as they can. So they're gonna give you goals, and then you know what? If you make those goals, they're gonna increase the goals. But they'll be yelling at you all the time. It's like the military. They have to break you down so they can turn you into what they want you to be. So they're going to tell you, 'You're not good enough, you're not good enough, you're not good enough,' to make you work harder. Don't say, 'This is the best I can do.' Say, 'I'll try,' even if you know you can't do it. Because if you say, 'This is the best I can do,' they'll let you go. They hire and fire constantly, every day. You'll see people dropping all around you. But don't take it personally and break down or start crying when they yell at you."
Several months prior, I'd reported on an Ohio warehouse where workers shipped products for online retailers under conditions that were surprisingly demoralizing and dehumanizing, even to someone who's spent a lot of time working in warehouses, which I have. And then my editors sat me down. "We want you to go work for Amalgamated Product Giant Shipping Worldwide Inc.," they said. I'd have to give my real name and job history when I applied, and I couldn't lie if asked for any specifics. (I wasn't.) But I'd smudge identifying details of people and the company itself. Anyway, to do otherwise might give people the impression that these conditions apply only to one warehouse or one company. Which they don't.
So I fretted about whether I'd have to abort the application process, like if someone asked me why I wanted the job. But no one did. And though I was kind of excited to trot out my warehouse experience, mainly all I needed to get hired was to confirm 20 or 30 times that I had not been to prison.
The application process took place at a staffing office in a run-down city, the kind where there are boarded-up businesses and broken windows downtown and billboards advertising things like "Foreclosure Fridays!" at a local law firm. Six or seven other people apply for jobs along with me. We answer questions at computers grouped in several stations. Have I ever been to prison? the system asks. No? Well, but have I ever been to prison for assault? Burglary? A felony? A misdemeanor? Raping someone? Murdering anybody? Am I sure? There's no point in lying, the computer warns me, because criminal-background checks are run on employees. Additionally, I have to confirm at the next computer station that I can read, by taking a multiple-choice test in which I'm given pictures of several album covers, including Michael Jackson's Thriller, and asked what the name of the Michael Jackson album is. At yet another set of computers I'm asked about my work history and character. How do I feel about dangerous activities? Would I say I'm not really into them? Or really into them?
Macduff Everton/CorbisIn the center of the room, a video plays loudly and continuously on a big screen. Even more than you are hurting the company, a voice-over intones as animated people do things like accidentally oversleep, you are hurting yourself when you are late because you will be penalized on a point system, and when you get too many points, you're fired—unless you're late at any point during your first week, in which case you are instantly fired. Also because when you're late or sick you miss the opportunity to maximize your overtime pay. And working more than eight hours is mandatory. Stretching is also mandatory, since you will either be standing still at a conveyor line for most of your minimum 10-hour shift or walking on concrete or metal stairs. And be careful, because you could seriously hurt yourself. And watch out, because some of your coworkers will be the kind of monsters who will file false workers' comp claims. If you know of someone doing this and you tell on him and he gets convicted, you will be rewarded with $500.
The computers screening us for suitability to pack boxes or paste labels belong to a temporary-staffing agency. The stuff we order from big online retailers lives in large warehouses, owned and operated either by the retailers themselves or by third-party logistics contractors, a.k.a. 3PLs. These companies often fulfill orders for more than one retailer out of a single warehouse. America's largest 3PL, Exel, has 86 million square feet of warehouse in North America; it's a subsidiary of Deutsche Post DHL, which is cute because Deutsche Post is the German post office, which was privatized in the 1990s and bought DHL in 2002, becoming one of the world's biggest corporate employers. The $31 billion "value-added warehousing and distribution" sector of 3PLs is just a fraction of what large 3PLs' parent companies pull in. UPS's logistics division, for example, pulls in more than a half a billion, but it feeds billions of dollars of business to UPS Inc.
Anyhow, regardless of whether the retailer itself or a 3PL contractor houses and processes the stuff you buy, the actual stuff is often handled by people working for yet another company—a temporary-staffing agency. The agency to which I apply is hiring 4,000 drones for this single Amalgamated warehouse between October and December. Four thousand. Before leaving the staffing office, I'm one of them.
I'm assigned a schedule of Sunday through Thursday, 7 a.m. to 5:30 p.m. When additional overtime is necessary, which it will be soon (Christmas!), I should expect to leave at 7 or 7:30 p.m. instead. Eight days after applying, i.e., after my drug test has cleared, I walk through a small, desolate town nearly an hour outside the city where I was hired. This is where the warehouse is, way out here, a long commute for many of my coworkers. I wander off the main road and into the chamber of commerce to kill some afternoon time—though not too much since my first day starts at 5 a.m.—but I end up getting useful job advice.
"Well, what if I do start crying?" I ask the woman who warns me to keep it together no matter how awfully I'm treated. "Are they really going to fire me for that?"
"Yes," she says. "There's 16 other people who want your job. Why would they keep a person who gets emotional, especially in this economy?"
Still, she advises, regardless of how much they push me, don't work so hard that I injure myself. I'm young. I have a long life ahead of me. It's not worth it to do permanent physical damage, she says, which, considering that I got hired at elevensomething dollars an hour, is a bit of an understatement.
As the sun gets lower in the curt November sky, I thank the woman for her help. When I start toward the door, she repeats her "No. 1 rule of survival" one more time.
"Leave your pride and your personal life at the door." If there's any way I'm going to last, she says, tomorrow I have to start pretending like I don't have either.
Though it's inconvenient for most employees, the rural location of the Amalgamated Product Giant Shipping Worldwide Inc. warehouse isn't an accident. The town is bisected by a primary interstate, close to a busy airport, serviced by several major highways. There's a lot of rail out here. The town became a station stop on the way to more important places a hundred years ago, and it now feeds part of the massive transit networks used to get consumers anywhere goods from everywhere. Every now and then, a long line of railcars rolls past my hotel and gives my room a good shake. I don't ever get a good look at them, because it's dark outside when I go to work, and dark again when I get back.
Inside Amalgamated, an employee's first day is training day. Though we're not paid to be here until 6, we have been informed that we need to arrive at 5. If we don't show up in time to stand around while they sort out who we are and where they've put our ID badges, we could miss the beginning of training, which would mean termination. "I was up half the night because I was so afraid I was going to be late," a woman in her 60s tells me. I was, too. A minute's tardiness after the first week earns us 0.5 penalty points, an hour's tardiness is worth 1 point, and an absence 1.5; 6 is the number that equals "release." But during the first week even a minute's tardiness gets us fired. When we get lined up so we can be counted a third or fourth time, the woman conducting the roll call recognizes the last name of a young trainee. "Does your dad work here? Or uncle?" she asks. "Grandpa," he says, as another supervisor snaps at the same time, sounding not mean but very stressed out, "We gotta get goin' here."
The culture is intense, an Amalgamated higher-up acknowledges at the beginning of our training. He's speaking to us from a video, one of several videos—about company policies, sexual harassment, etc.—that we watch while we try to keep our eyes open. We don't want to be so intense, the higher-up says. But our customers demand it. We are surrounded by signs that state our productivity goals. Other signs proclaim that a good customer experience, to which our goal-meeting is essential, is the key to growth, and growth is the key to lower prices, which leads to a better customer experience. There is no room for inefficiencies. The gal conducting our training reminds us again that we cannot miss any days our first week. There are NO exceptions to this policy. She says to take Brian, for example, who's here with us in training today. Brian already went through this training, but then during his first week his lady had a baby, so he missed a day and he had to be fired. Having to start the application process over could cost a brand-new dad like Brian a couple of weeks' worth of work and pay. Okay? Everybody turn around and look at Brian. Welcome back, Brian. Don't end up like Brian.
Soon, we move on to practical training. Like all workplaces with automated and heavy machinery, this one contains plenty of ways to get hurt, and they are enumerated. There are transition points in the warehouse floor where the footing is uneven, and people trip and sprain ankles. Give forklifts that are raised up several stories to access products a wide berth: "If a pallet falls on you, you won't be working with us anymore." Watch your fingers around the conveyor belts that run waist-high throughout the entire facility. People lose fingers. Or parts of fingers. And about once a year, they tell us, someone in an Amalgamated warehouse gets caught by the hair, and when a conveyor belt catches you by the hair, it doesn't just take your hair with it. It rips out a piece of scalp as well.
If the primary message of one-half of our practical training is Be Careful, the takeaway of the other half is Move As Fast As Humanly Possible. Or superhumanly possible. I have been hired as a picker, which means my job is to find, scan, place in a plastic tote, and send away via conveyor whatever item within the multiple stories of this several-hundred-thousand-square-foot warehouse my scanner tells me to. We are broken into groups and taught how to read the scanner to find the object among some practice shelves. Then we immediately move on to practicing doing it faster, racing each other to fill the orders our scanners dictate, then racing each other to put all the items back.
Home Depot Chris Mueller/Redux"Hurry up," a trainer encourages me when he sees me pulling ahead of the others, "and you can put the other items back!" I roll my eyes that my reward for doing a good job is that I get to do more work, but he's got my number: I am exactly the kind of freak this sort of motivation appeals to. I win, and set myself on my prize of the bonus errand.
That afternoon, we are turned loose in the warehouse, scanners in hand. And that's when I realize that for whatever relative youth and regular exercise and overachievement complexes I have brought to this job, I will never be able to keep up with the goals I've been given.
The place is immense. Cold, cavernous. Silent, despite thousands of people quietly doing their picking, or standing along the conveyors quietly packing or box-taping, nothing noisy but the occasional whir of a passing forklift. My scanner tells me in what exact section—there are nine merchandise sections, so sprawling that there's a map attached to my ID badge—of vast shelving systems the item I'm supposed to find resides. It also tells me how many seconds it thinks I should take to get there. Dallas sector, section yellow, row H34, bin 22, level D: wearable blanket. Battery-operated flour sifter. Twenty seconds. I count how many steps it takes me to speed-walk to my destination: 20. At 5-foot-9, I've got a decently long stride, and I only cover the 20 steps and locate the exact shelving unit in the allotted time if I don't hesitate for one second or get lost or take a drink of water before heading in the right direction as fast as I can walk or even occasionally jog. Olive-oil mister. Male libido enhancement pills. Rifle strap. Who the fuck buys their paper towels off the internet? Fairy calendar. Neoprene lunch bag. Often as not, I miss my time target.

TOP 60
US Online Retailers

1. Amazon
2. Staples
3. Apple
4. Dell
5. Office Depot
6. Walmart
7. Sears
8. Liberty Media Corp. (QVC)
9. Office Max
10. CDW Corp.
11. Best Buy
12. Newegg
13. Netflix
14. Sony USA
15. W.W. Grainger
16. Costco
17. Macy's
18. Victoria Secret and Bath & Body Works
19. HP Home & Home Office Store
20. J.C. Penney
21. L.L. Bean
22. Target
23. Systemax
24. Gap
25. Williams-Sonoma
26. HSN
27. Overstock.com
28. Amway Global
29. Toys R Us
30. Avon
31. Kohl's
32. Buy.com
33. Redcats USA
34. Nordstrom
35. Symantec
36. Vistaprint
37. PC Connection
38. Saks
39. Neiman Marcus
40. Cabela's
41. Barnes & Noble
42. Blockbuster
43. Home Depot
44. Musician's Friend
45.  1-800-Flowers .com
46. Drugstore.com
47. Peapod
48. Urban Outfitters
49. Gilt Groupe
50. J. Crew Group
51. CSN Stores
52. PC Mall
53. Foot Locker
54. Scholastic
55. Crate and Barrel
56. Abercrombie & Fitch
57. American Eagle Outfitters
58. Follett Higher Education group
59. US Auto Parts Network
60. Blue Nile

Source: Internet Retailer Top 500 Guide

Plenty of things can hurt my goals. The programs for our scanners are designed with the assumption that we disposable employees don't know what we're doing. Find a Rob Zombie Voodoo Doll in the blue section of the Rockies sector in the third bin of the A-level in row Z42, my scanner tells me. But if I punch into my scanner that it's not there, I have to prove it by scanning every single other item in the bin, though I swear on my life there's no Rob Zombie Voodoo Doll in this pile of 30 individually wrapped and bar-coded batteries that take me quite a while to beep one by one. It could be five minutes before I can move on to, and make it to, and find, my next item. That lapse is supposed to be mere seconds.
This week, we newbies need to make 75 percent of our total picking-volume targets. If we don't, we get "counseled." If the people in here who've been around longer than a few weeks don't make their 100 percent, they get counseled. Why aren't you making your targets? the supervisors will ask. You really need to make your targets.
From the temp agency, Amalgamated has ordered the exact number of humans it should take to fill this week's orders if we work at top capacity. Lots of retailers use temporary help in peak season, and online ones are no exception. But lots of warehousing and distribution centers like this also use temps year-round. The Bureau of Labor Statistics found that more than 15 percent of pickers, packers, movers, and unloaders are temps. They make $3 less an hour on average than permanent workers. And they can be "temporary" for years. There are so many temps in this warehouse that the staffing agency has its own office here. Industry consultants describe the temp-staffing business as "very, very busy." "On fire." Maximizing profits means making sure no employee has a slow day, means having only as many employees as are necessary to get the job done, the number of which can be determined and ordered from a huge pool of on-demand labor literally by the day. Often, temp workers have to call in before shifts to see if they'll get work. Sometimes, they're paid piece rate, according to the number of units they fill or unload or move. Always, they can be let go in an instant, and replaced just as quickly.
Everyone in here is hustling. At the announcement to take one of our two 15-minute breaks, we hustle even harder. We pickers close out the totes we're currently filling and send them away on the conveyor belt, then make our way as fast as we can with the rest of the masses across the long haul of concrete between wherever we are and the break room, but not before passing through metal detectors, for which there is a line—we're required to be screened on our way out, though not on our way in; apparently the concern is that we're sneaking Xbox 360s up under our shirts, not bringing in weapons. If we don't set off the metal detector and have to be taken aside and searched, we can run into the break room and try to find a seat among the rows and rows and long-ass rows of tables. We lose more time if we want to pee—and I do want to pee, and when amid the panic about the time constraints it occurs to me that I don't have my period I toss a fist victoriously into the air—between the actual peeing and the waiting in line to pee in the nearest one of the two bathrooms, which has eight stalls in the ladies' and I'm not sure how many in the men's and serves thousands of people a day. Once I pare this process down as much as possible, by stringing a necktie through my belt loops because I can't find a metal-less replacement for my belt at the local Walmart—and if my underwear or butt-crack slips out, I've been warned, I can get penalized—and by leaving my car keys in the break room after a manager helps me find an admittedly "still risky" hiding place for them because we have no lockers and "things get stolen out of here all the time," I get myself up to seven minutes' worth of break time to inhale as many high-fat and -protein snacks as I can. People who work at Amalgamated are always working this fast. Right now, because it's almost Black Friday, there are just more of us doing it.
Then as quickly as we've come, we all run back. At the end of the 15 minutes, we're supposed to be back at whichever far-flung corner of the warehouse we came from, scanners in hand, working. We run to grab the wheeled carts we put the totes on. We run past each other and if we do say something, we say it as we keep moving. "How's the job market?" a supervisor says, laughing, as several of us newbies run by. "Just kidding!" Ha ha! "I know why you guys are here. That's why I'm here, too!" At another near collision between employees, one wants to know how complaining about not being able to get time off went and the other spits that he was told he was lucky to have a job. This is no way to have a conversation, but at least conversations are not forbidden, as they were in the Ohio warehouse I reported on—where I saw a guy get fired for talking, specifically for asking another employee, "Where are you from?" So I'm allowed the extravagance of smiling at a guy who is always so unhappy and saying, "How's it goin'?" And he can respond, "Terrible," as I'm running to the big industrial cage-lift that takes our carts up to the second or third floors, which involves walking under a big metal bar gating the front of it, and which I should really take my time around. Within the last month, three different people have needed stitches in the head after being clocked by these big metal bars, so it's dangerous. Especially the lift in the Dallas sector, whose bar has been installed wrong, so it is extra prone to falling, they tell us. Be careful. Seriously, though. We really need to meet our goals here.
Amalgamated has estimated that we pickers speed-walk an average of 12 miles a day on cold concrete, and the twinge in my legs blurs into the heavy soreness in my feet that complements the pinch in my hips when I crouch to the floor—the pickers' shelving runs from the floor to seven feet high or so—to retrieve an iPad protective case. iPad anti-glare protector. iPad one-hand grip-holder device. Thing that looks like a landline phone handset that plugs into your iPad so you can pretend that rather than talking via iPad you are talking on a phone. And dildos. Really, a staggering number of dildos. At breaks, some of my coworkers complain that they have to handle so many dildos. But it's one of the few joys of my day. I've started cringing every time my scanner shows a code that means the item I need to pick is on the ground, which, in the course of a 10.5-hour shift—much less the mandatory 12-hour shifts everyone is slated to start working next week—is literally hundreds of times a day. "How has OSHA signed off on this?" I've taken to muttering to myself. "Has OSHA signed off on this?" ("The thing about ergonomics," OSHA says when I call them later to ask, "is that OSHA doesn't have a standard. Best practices. But no laws.") So it's a welcome distraction, really, to imagine all these sex toys being taken out from under a tree and unwrapped. Merry Christmas. I got you this giant black cock you wanted.
At lunch, the most common question, aside from "Which offensive dick-shaped product did you handle the most of today?" is "Why are you here?" like in prison. A guy in his mid-20s says he's from Chicago, came to this state for a full-time job in the city an hour away from here because "Chicago's going down." His other job doesn't pay especially well, so he's here—pulling 10.5-hour shifts and commuting two hours a day—anytime he's not there. One guy says he's a writer; he applies for grants in his time off from the warehouse. A middle-aged lady near me used to be a bookkeeper. She's a peak-season hire, worked here last year during Christmas, too. "What do you do the rest of the year?" I ask. "Collect unemployment!" she says, and laughs the sad laugh you laugh when you're saying something really unfunny. All around us in the break room, mothers frantically call home. "Hi, baby!" you can hear them say; coos to children echo around the walls the moment lunch begins. It's brave of these women to keep their phones in the break room, where theft is so high—they can't keep them in their cars if they want to use them during the day, because we aren't supposed to leave the premises without permission, and they can't take them onto the warehouse floor, because "nothing but the clothes on your backs" is allowed on the warehouse floor (anything on your person that Amalgamated sells can be confiscated—"And what does Amalgamated sell?" they asked us in training. "Everything!"). I suppose that if I were responsible for a child, I would have no choice but to risk leaving my phone in here, too. But the mothers make it quick. "How are you doing?" "Is everything okay?" "Did you eat something?" "I love you!" and then they're off the phone and eating as fast as the rest of us. Lunch is 29 minutes and 59 seconds—we've been reminded of this: "Lunch is not 30 minutes and 1 second"—that's a penalty-point-earning offense—and that includes the time to get through the metal detectors and use the disgustingly overcrowded bathroom—the suggestion board hosts several pleas that someone do something about that smell—and time to stand in line to clock out and back in. So we chew quickly, and are often still chewing as we run back to our stations.
Amazon Macduff Everton/Corbis
The days blend into each other. But it's near the end of my third day that I get written up. I sent two of some product down the conveyor line when my scanner was only asking for one; the product was boxed in twos, so I should've opened the box and separated them, but I didn't notice because I was in a hurry. With an hour left in the day, I've already picked 800 items. Despite moving fast enough to get sloppy, my scanner tells me that means I'm fulfilling only 52 percent of my goal. A supervisor who is a genuinely nice person comes by with a clipboard listing my numbers. Like the rest of the supervisors, she tries to create a friendly work environment and doesn't want to enforce the policies that make this job so unpleasant. But her hands are tied. She needs this job, too, so she has no choice but to tell me something I have never been told in 19 years of school or at any of some dozen workplaces."You're doing really bad," she says.
I'll admit that I did start crying a little. Not at work, thankfully, since that's evidently frowned upon, but later, when I explained to someone over Skype that it hurts, oh, how my body hurts after failing to make my goals despite speed-walking or flat-out jogging and pausing every 20 or 30 seconds to reach on my tiptoes or bend or drop to the floor for 10.5 hours, and isn't it awful that they fired Brian because he had a baby, and, in fact, when I was hired I signed off on something acknowledging that anyone who leaves without at least a week's notice—whether because they're a journalist who will just walk off or because they miss a day for having a baby and are terminated—has their hours paid out not at their hired rate but at the legal minimum. Which in this state, like in lots of states, is about $7 an hour. Thank God that I (unlike Brian, probably) didn't need to pay for opting into Amalgamated's "limited" health insurance program. Because in my 10.5-hour day I'll make about $60 after taxes.
"This is America?" my Skype pal asks, because often I'm abroad.
Indeed, and I'm working for a gigantic, immensely profitable company. Or for the staffing company that works for that company, anyway. Which is a nice arrangement, because temporary-staffing agencies keep the stink of unacceptable labor conditions off the companies whose names you know. When temps working at a Walmart warehouse sued for not getting paid for all their hours, and for then getting sent home without pay for complaining, Walmart—not technically their employer—wasn't named as a defendant. (Though Amazon has been named in a similar suit.) Temporary staffers aren't legally entitled to decent health care because they are just short-term "contractors" no matter how long they keep the same job. They aren't entitled to raises, either, and they don't get vacation and they'd have a hell of a time unionizing and they don't have the privilege of knowing if they'll have work on a particular day or for how long they'll have a job. And that is how you slash prices and deliver products superfast and offer free shipping and still post profits in the millions or billions.
"This really doesn't have to be this awful," I shake my head over Skype. But it is. And this job is just about the only game in town, like it is in lots of towns, and eventually will be in more towns, with US internet retail sales projected to grow 10 percent every year to $279 billion in 2015 and with Amazon, the largest of the online retailers, seeing revenues rise 30 to 40 percent year after year and already having 69 giant warehouses, 17 of which came online in 2011 alone. So butch up, Sally.
"You look way too happy," an Amalgamated supervisor says to me. He has appeared next to me as I work, and in the silence of the vast warehouse, his presence catches me by surprise. His comment, even more so.
"Really?" I ask.
I don't really feel happy. By the fourth morning that I drag myself out of bed long before dawn, my self-pity has turned into actual concern. There's a screaming pain running across the back of my shoulders. "You need to take 800 milligrams of Advil a day," a woman in her late 50s or early 60s advised me when we all congregated in the break room before work. When I arrived, I stashed my lunch on a bottom ledge of the cheap metal shelving lining the break room walls, then hesitated before walking away. I cursed myself. I forgot something in the bag, but there was no way to get at it without crouching or bending over, and any extra times of doing that today were times I couldn't really afford. The unhappy-looking guy I always make a point of smiling at told me, as we were hustling to our stations, that this is actually the second time he's worked here: A few weeks back he missed some time for doctors' appointments when his arthritis flared up, and though he had notes for the absences, he was fired; he had to start the application process over again, which cost him an extra week and a half of work. "Zoom zoom! Pick it up! Pickers' pace, guys!" we were prodded this morning. Since we already felt like we were moving pretty fast, I'm quite dispirited, in fact.
"Really?" I ask.
"Well," the supervisor qualifies. "Just everybody else is usually really sad or mad by the time they've been working here this long."
It's my 28th hour as an employee.
I probably look happier than I should because I have the extreme luxury of not giving a shit about keeping this job. Nevertheless, I'm tearing around my assigned sector hard enough to keep myself consistently light-headed and a little out of breath. I'm working in books today. "Oh," I smiled to myself when I reached the paper-packed shelves. I love being around books.
Picking books for Amalgamated has a disadvantage over picking dildos or baby food or Barbies, however, in that the shelving numbers don't always line up. When my scanner tells me the book I need is on the lowest level in section 28 of a row, section 28 of the eye-level shelf of that row may or may not line up with section 28 of the lowest level. So when I spot eye-level section 28 and squat or kneel on the floor, the section 28 I'm looking for might be five feet to my right or left. Which means I have to stand up and crouch back down again to get there, greatly increasing the number of times I need to stand and crouch/kneel in a day. Or I can crawl. Usually, I crawl. A coworker is choosing the crouch/kneel option. "This gets so tiring after a while," he says when we pass each other. He's 20. It's 9:07 a.m.
There are other disadvantages to working in books. In the summer, it's the heat. Lots of the volumes are stored on the second and third floors of this immense cement box; the job descriptions we had to sign off on acknowledged that temperatures can be as low as 60 and higher than 95 degrees, and higher floors tend to be hotter. "They had to get fans because in the summer people were dying in here," one of the supervisors tells us. The fans still blow now even though I'm wearing five shirts. "If you think it's cold in here," one of my coworkers told me when she saw me rubbing my arms for warmth one morning, "just hope we don't have a fire drill." They evacuated everyone for one recently, and lots of the fast-moving employees had stripped down to T-shirts. They stood outside, masses of them, shivering for an hour as snow fell on their bare arms.
Netflix Matthew J. Lee/Boston Globe/Getty Images
In the books sector, in the cold, in the winter dryness, made worse by the fans and all the paper, I jet across the floor in my rubber-soled Adidas, pant legs whooshing against each other, 30 seconds according to my scanner to take 35 steps to get to the right section and row and bin and level and reach for Diary of a Wimpy Kid and "FUCK!" A hot spark shoots between my hand and the metal shelving. It's not the light static-electric prick I would terrorize my sister with when we got bored in carpeted department stores, but a solid shock, striking enough to make my body learn to fear it. I start inadvertently hesitating every time I approach my target. One of my coworkers races up to a shelving unit and leans in with the top of his body first; his head touches the metal, and the shock knocks him back. "Be careful of your head," he says to me. In the first two hours of my day, I pick 300 items. The majority of them zap me painfully.
"Please tell me you have suggestions for dealing with the static electricity," I say to a person in charge when the morning break comes. This conversation is going to cost me a couple of my precious few minutes to eat/drink/pee, but I've started to get paranoid that maybe it's not good for my body to exchange an electric charge with metal several hundred times in one day.
"Oh, are you workin' in books?"
"Yeah."
"No. Sorry." She means this. I feel bad for the supervisors who are trying their damnedest to help us succeed and not be miserable. "They've done everything they can"—"they" are not aware, it would appear, that anti-static coating and matting exist—"to ground things up there but there's nothing you can do."
I produce a deep frown. But even if she did have suggestions, I probably wouldn't have time to implement them. One suggestion for minimizing work-related pain and strain is to get a stepladder to retrieve any items on shelves above your head rather than getting up on your toes and overreaching. But grabbing one of the stepladders stashed few and far between among the rows of merchandise takes time. Another is to alternate the hand you use to hold and wield your cumbersome scanner. "You'll feel carpal tunnel start to set in," one of the supervisors told me, "so you'll want to change hands." But that, too, he admitted, costs time, since you have to hit the bar code at just the right angle for it to scan, and your dominant hand is way more likely to nail it the first time. Time is not a thing I have to spare. I'm still only at 57 percent of my goal. It's been 10 years since I was a mover and packer for a moving company, and only slightly less since I worked ridiculously long hours as a waitress and housecleaner. My back and knees were younger then, but I'm only 31 and feel pretty confident that if I were doing those jobs again I'd still wake up with soreness like a person who'd worked out too much, not the soreness of a person whose body was staging a revolt. I can break into goal-meeting suicide pace for short bouts, sure, but I can't keep it up for 10.5 hours.
"Do not say that," one of the workampers tells me at break. Workampers are people who drive RVs around the country, from temporary job to temporary job, docking in trailer camps. "We're retired but we can't…" another explains to me about himself and his wife, shrugging, "make it. And there's no jobs, so we go where the jobs are."
Amalgamated advertises positions on websites workampers frequent. In this warehouse alone, there are hundreds of them.
"Never say that you can't do it," the first workamper emphasizes. "When they ask you why you aren't reaching your goals—"
"Say, 'It's because they're totally unreasonable'?" I suggest.
"Say you'll do better, even if you know you can't," she continues, ignoring me. "Say you'll try harder, even if the truth is that you're trying your absolute hardest right now, no matter how many times they tell you you're not doing good enough."
There are people who make the goals. One of the trainers does. She works here all year, not just during Christmas. "I hated picking for the first month," she told me sympathetically the other day. "Then you just get used to it." She's one of many hardcore workers here, a labor pool studded with dedicated and solid employees. One of the permanent employees has tried to encourage me by explaining that he always makes his goals, and sometimes makes 120 percent of them. When I ask him if that isn't totally exhausting, he says, "Oh yeah. You're gonna be crying for your mommy when today's over." When I ask him if there's any sort of incentive for his overperformance, if he's rewarded in any way, he says occasionally Amalgamated enters him in drawings for company gift cards. For $15 or $20. He shrugs when he admits the size of the bonus. "These days you need it." Anyway, he says, he thinks it's important to have a good attitude and try to do a good job. Even some of the employees who are total failures are still trying really hard. "I heard you're doing good," one of the ladies in my training group says to me. Her eyebrows are heavy with stress. I am still hitting less than 60 percent of my target. Still, that's better than she's doing. "Congratulations," she says, and smiles sadly.
Zappos Brent Humphreys/ReduxWe will be fired if we say we just can't or won't get better, the workamper tells me. But so long as I resign myself to hearing how inadequate I am on a regular basis, I can keep this job. "Do you think this job has to be this terrible?" I ask the workamper.
"Oh, no," she says, and makes a face at me like I've asked a stupid question, which I have. As if Amalgamated couldn't bear to lose a fraction of a percent of profits by employing a few more than the absolute minimum of bodies they have to, or by storing the merchandise at halfway ergonomic heights and angles. But that would cost space, and space costs money, and money is not a thing customers could possibly be expected to hand over for this service without huffily taking their business elsewhere. Charging for shipping does cause high abandonment rates of online orders, though it's not clear whether people wouldn't pay a few bucks for shipping, or a bit more for the products, if they were guaranteed that no low-income workers would be tortured or exploited in the handling of their purchases.
"The first step is awareness," an e-commerce specialist will tell me later. There have been trickles of information leaking out of the Internet Order Fulfillment Industrial Complex: an investigation by the Allentown, Pennsylvania, Morning Call in which Amazon workers complained of fainting in stifling heat, being disciplined for getting heat exhaustion, and otherwise being "treated like a piece of crap"; a workampers' blog picked up by Gizmodo; a Huffington Post exposé about the lasting physical damage and wild economic instability temporary warehouse staffers suffer. And workers have filed lawsuits against online retailers, their logistics companies, and their temp agencies over off-the-clock work and other compensation issues, as well as at least one that details working conditions that are all too similar. (That case has been dismissed but is on appeal.) Still, most people really don't know how most internet goods get to them. The e-commerce specialist didn't even know, and she was in charge of choosing the 3PL for her midsize online-retail company. "These decisions are made at a business level and are based on cost," she says. "I never, ever thought about what they're like and how they treat people. Fulfillment centers want to keep clients blissfully ignorant of their conditions." If you called major clothing retailers, she ventured, and asked them "what it was like at the warehouse that ships their sweaters, no one at company headquarters would have any fucking clue."
Further, she said, now that I mentioned it, she has no idea how to go about getting any information on the conditions at the 3PL she herself hired. Nor how to find a responsible one. "A standard has to be created. Like fair trade or organic certification, where social good is built into the cost. There is a segment of the population"—like the consumers of her company's higher-end product, she felt—"that cares and will pay for it."
If they are aware how inhumane the reality is. But awareness has a long way to go, and logistics doesn't just mean online retail; food packagers and processors, medical suppliers, and factories use mega-3PLs as well. And a whole lot of other industries—hotels, call centers—take advantage of the price controls and plausible deniability that temporary staffing offers.
"Maybe awareness will lead to better working conditions," says Vinod Singhal, a professor of operations management at Georgia Tech. "But…" Given the state of the economy, he isn't optimistic.
This is the kind of resignation many of my coworkers have been forced to accept. At the end of break, the workamper and I are starting to fast-walk back to our stations. A guy who's been listening to our conversation butts in. "They can take you for everything you've got," he says. "They know it's your last resort."
At today's pickers' meeting, we are reminded that customers are waiting. We cannot move at a "comfortable pace," because if we are comfortable, we will never make our numbers, and customers are not willing to wait. And it's Christmastime. We got 2.7 million orders this week. People need—need—these items and they need them right now. So even if you've worked here long enough to be granted time off, you are not allowed to use it until the holidays are over. (And also forget about Election Day, which is today. "What if I want to vote?" I ask a supervisor. "I think you should!" he says. "But if I leave I'll get fired," I say. To which he makes a sad face before saying, "Yeah.") No time off includes those of you who are scheduled to work Thanksgiving. There are two Amalgamated-catered Thanksgiving dinners offered to employees next week, but you can only go to one of them. If you attend one, your employee badge will be branded with a nonremovable sticker so that you cannot also attempt to eat at the other. Anyway, good luck, everybody. Everybody back to work. Quickly!
Speed-walking back to the electro-trauma of the books sector, I wince when I unintentionally imagine the types of Christmas lore that will prevail around my future household. I feel genuinely sorry for any child I might have who ever asks me for anything for Christmas, only to be informed that every time a "Place Order" button rings, a poor person takes four Advil and gets told they suck at their job.
I suppose this is what they were talking about in the radio ad I heard on the way to work, the one that was paid for by a coalition of local businesses, gently begging citizens to buy from them instead of off the internet and warning about the importance of supporting local shops. But if my coworker Brian wants to feed his new baby any of these 24-packs of Plum Organics Apple & Carrot baby food I've been picking, he should probably buy them from Amazon, where they cost only $31.16. In my locally owned grocery store, that's $47.76 worth of sustenance. Even if he finds the time to get in the car to go buy it at a brick-and-mortar Target, where it'd be less convenient but cost about the same as on Amazon, that'd be before sales tax, which physical stores, unlike Amazon, are legally required to charge to help pay for the roads on which Brian's truck, and more to the point Amazon's trucks, drive.
Back in books, I take a sharp shock to my right hand when I grab the book the scanner cramping my left hand demands me to and make some self-righteous promises to myself about continuing to buy food at my more-expensive grocery store, because I can. Because I'm not actually a person who makes $7.25 an hour, not anymore, not one of the 1 in 3 Americans who is now poor or "near poor." For the moment, I'm just playing one.
"Lucky girl," I whisper to myself at the tail of a deep breath, as soon as fresh winter air hits my lungs. It's only lunchtime, but I've breached the warehouse doors without permission. I've picked 500 items this morning, and don't want to get shocked anymore, or hear from the guy with the clipboard what a total disappointment I am. "Lucky girl, lucky girl, lucky girl," I repeat on my way to my car. I told the lady from my training group who's so stressed about her poor performance to tell our supervisor not to look for me—and she grabbed my arm as I turned to leave, looking even more worried than usual, asking if I was sure I knew what I was doing. I don't want our supervisor to waste any time; he's got goals to make, too. He won't miss me, and nobody else will, either. The temp agency is certainly as full of applicants as it was when I went to ask for a job.
"Just look around in here if you wanna see how bad it is out there," one of the associates at the temp office said to me, unprompted, when I got hired. It's the first time anyone has ever tried to comfort me because I got a job, because he knew, and everyone in this industry that's growing wildfire fast knows, and accepts, that its model by design is mean. He offered me the same kind of solidarity the workers inside the warehouse try to provide each other at every break: Why are you here? What happened that you have to let people treat you like this? "We're all in the same boat," he said, after shaking my hand to welcome me aboard. "It's a really big boat."

This story ran in the March/April 2012 issue of Mother Jones, under the headline "Shelf Lives."