Free Money: How Corporate America Transfers Cost and Responsibility to Consumers

One afternoon while cooking her sauce, my aunt insisted on telling me about the way things used to be. Her stories were of years gone past, and the greater part of an hour was spent painting scenes of a time and people I had never known—and never would. To me, it was a fairytale, but this was the world she knew. Having grown up in the 50’s, the lack of wrinkles on her face might be enough for someone to question her age, but certainly not her wisdom.

“You see in those days, everyone on the block would watch all the children who lived there. If you went over to your neighbor’s house to play, they fed you lunch and could beat you for misbehaving. I once caught a beating from the lady down the street for trying to start a fire with leaves on the side of her house. I never did that again.”

The more she spoke, the more it became alarmingly clear how right she was: things have changed. With each story of shared holidays, arguments, and sacrifices, there emerged a common theme between the community she remembered and the people who lived there. It wasn’t about whose kid caused more trouble or how many more sandwiches Mrs. Gallo had to make that week than her counterparts. What you saw in each flashback was responsibility shared equally, and that the brunt of sacrifice was shouldered by all. People took on responsibility in the best interest of the whole community, and consideration for everyone’s cost was deemed a necessary component of the shared goal. The uniquely significant details of that time period presented the mitigation of cost not just amongst neighbors, but also more uniformly across political and economic landscapes. More specifically there seemed to be a willingness of the marketplace, built on the borders of obligation, to accept the greater responsibility of absorbing the costs of the population they served.

It was once understood that a healthy society was good for private enterprise, that when people were taken care of they took care of the market. Catering to the needs of the people and absorbing the associated costs was once viewed as the normal responsibly of private enterprise—not a socialist agenda. Yet more and more, as profits are valued over people—becoming more important than the integrity of human capital within a society—private enterprise has found exceedingly clever ways to push more costs onto the backs of consumers.

Noam Chomsky, the famous linguist and intellectual of our day, spoke about this once in a great speech about higher education when he quoted one of the trustees of the New York State University system:

“There’s been a shift from the belief that we as a nation benefit from higher education, to a belief that the people who are receiving the education are the one’s who benefit, so they should foot the bill.”

Though made made in the context of higher education as a business, the logic of this quote can be applied to the new spirit of economics between the market and the people it serves. I use that description deliberately: the market place serves the people. This is not to be confused with the pervasive inversion of this relationship in which the people serve the marketplace, because the marketplace does not have needs. It is the people who have needs, and so the marketplace was created to fulfill those needs. In understanding that markets are created to serve the people, the burden of obligation is therefore more heavily thrusted upon the marketplace. It is the marketplace which must take care of the people for that is its purpose, and without such, it does not exist. However, rather than absorbing sustainable costs—an act which preserves the people, and subsequently, the commerce they create—private enterprise has opted to serve bottom-lines by pushing as much cost onto the individual as possible.

Chomsky also rightly identifies the heart of the issue at hand:

“As usual, the primary victims are the ones who are most vulnerable.”

The easiest way this is done is by consolidating power in the market, and then, simply cutting options that liberate the people by dictating choices that put them at a disadvantage. As is customary of private enterprise, this ILLUSION of choice is presented to the common people in a way which disguises their exploitation.

SELF CHECK-OUT: YOU GOT THIS, RIGHT?

There’s an amazingly funny bit done by one of my favorite comedians, Bill Burr, that pretty much sums up the entirety of this post. It’s an excerpt from his standup special entitled, “Let it Go”.

(On Self Check-out systems at the grocery store)

“Dude, do you realize the balls of that? The balls of that. Yeah, I’m gonna have a store. You come in, you pick out what you want, you bring it up, you ring it up, you pay me, you put it in a bag, and then you get the f*ck out of my store. Let’s go people, step it up, I’m trying to run a business here.”

Checking out at a grocery store has evolved quickly since I was a boy—and I’m not that old. In the beginning there were two: one human being rang-up your groceries and one bagged them. Then there one was: one employee rang-up your up groceries and you bagged your own food. Now there are none; now grocery stores have fewer human cashiers and virtually no baggers—that’s you’re job now. Congratulations, you now work at a grocery store. But don’t get too excited, because you’re not getting a paycheck. In fact, prices won’t even drop and some may even increase. But hey, now you can finally play with that laser barcode scanner you’ve been infatuated with since you were five. This is technology giving back to the people my friend. At least that’s the way they make it seem. Food stores try to sell you the idea that self-check systems out benefit you, the consumer. Nothing could be farther from the truth.

Let’s get something straight here: self-check out is a scam. Period.

Self Check-Out systems are meant to do one thing and one thing only: Fatten bottom lines by transfering the entire cost and responsibility of the check-out process to the consumer. 

While these automated systems appear to provide an added benefit to the consumer over a human employee, the illusion fails when one considers the many more drawbacks of the system. With a human employee the store takes on the responsibility of providing the money, training, and quality assurance necessary to create a consistent and relatively problem-free transaction. Human employees memorize those fruit and veggie codes so you don’t have to.

With self check-out services, the quality and speed of your check-out experience is entirely dependent on the tech savviness of you and the customer in front of you, and the probability that the machine will work correctly 100% of the time. If the person in front of you moves slowly or can’t work the machine well, it’s not the store’s fault; that’s the fault of the person in front of you. Similarly, if the machine malfunctions and you have a bad check-out experience as a result, that TOO is not the fault of the store; that’s the machine’s fault. Human employees don’t malfunction.

Obviously self-check out is not mandatory. You don’t have to use self check-out system. But, because self check-out units are often adopted in tandem with staffing cuts, this means less human employees. So, even when I decide not to use the self check-out machines, costs are still thrusted upon me as lines are even longer at human employee check-out lanes due to staff cuts. In the end, you end up spending more time than you ever would with a full staff of trained employees in every lane.

Bill Burr made another remark that’s relevant to this post when a sandwich shop asked him to put his own mayonnaise on his own sandwich.

“I just gave you 100% of the money, to make 100% of the sandwich.”

OUT-OF-ORDER (BUT, NOT REALLY)

Back in April of this year I went to pick up my friend at the Port Authority in New York City. After living in Japan for seven years, two of which I shared with him, he was finally coming home—for a month, before flying off to Brazil, to live with his girlfriend in a shack. He had been to NYC only one other time when he was 10, and because his bus home to Rhode Island wouldn’t leave until the following morning, I offered my place for him to crash. Now, being the nice guy that I am, I also decided to pay for his travel fares on the way back to Jersey where I live. This included the $2.25 path train fare that would take us to Hoboken, and then the train to Essex street in Hackensack.

Upon arriving at the path train station on 33rd street, I was met with horror as I approached a long line that grew out from the ticketing machines. Not one, but ALL of the five machines there were unable to take plastic money; all required cash. Though this seemed a minor inconvenience for me (or so I thought), those with credit and debit cards were left stranded, doomed to hunt down an ATM machine for those precious twenty-dollar bills.

When my turn came, I threw a $20 bill into the slot and chose a two-ride fare ticket ($4.50) to accommodate both our rides. What happened next still haunts me to this day: The machine was not only limited to a cash purchase, but also the amount of change it was willing to give out.

The machine refused to give more than $7.00 change, as indicated by a large obnoxious message blinking on the monitor. Ugh. Okay, so the next option up was a $10 fare card. But, if you do the math, that’s still more than $7.00 change from a twenty-dollar bill. I was livid at this point.

So what was the next ticket option? TWENTY DOLLARS. That’s over fifteen dollars more than I needed; over fifteen dollars that would probably expire on that card before I ever used it. The MTA had made $15.50 from NOTHING. And this is the illusion that service and product industries have created to make money out of nothing: giving the consumer a service or feature they didn’t ask for or won’t use, and charging us just because we have the “option” of using it. Because they’ve decided that a $20 purchase is convenient FOR me, I’m forced to pay for more service than I actually need.

You no longer get what you pay for; now, you pay for what they decide to give you. And I use the word “decide” deliberately, as I find it impossible to believe there exists any good reason that all five ticketing machines should be out order at the same time. In Japan, those machines wouldn’t have been down longer than 5 minutes. But in Japan, customers matter far more than profit; it’s the reverse in America. One or two machines—okay, maybe. But all five? There’s no reason people should be forced to spend more money on ticket fares they won’t use—unless, of course, that’s your goal in the first place: to squeeze every dollar out of people, no matter what the cost. (Because, of course, in this case, 100% of the cost is taken on by the individual; the MTA makes MORE money through cash purchases, but doesn’t necessarily have to fix the card readers on their machines). Think about it. Most ATM machines only give dispense withdrawals in denominations of twenty-dollar bills. So, in this way, even if someone could get to an ATM, they’d end up buying a $20 fare ticket no matter what because the machines won’t dispense change over $7.

BINGO: FREE MONEY. 

But the cost to the individual is not only monetary. Consumers at the mercy of corporate strategies meant to increase profits—instead of the integral well-being of society at large—are subjected to the invisible costs of time spent, stress, added responsibilities, and the energy necessary to handle all three. And yet, all of these costs are easily mitigated or absorbed by the enterprises that provide these services, if only they could (or wanted to) fix those machines in a timely manner.

UNIVERSITY: SHUT UP AND TAKE MY MONEY.

A friend of my recounted a truly eye-opening experience while once attending an admissions interview for a university of her choosing. To put this into perspective, it wasn’t a particularly competative school. She got in, but ultimately decided not to attend due to her experience. This is how it went down.

During the interview my friend was asked blankly:

“What do you have to offer the university?”

A voice inside her head replied,

“You mean in addition to the 40k a year I’ll be paying to go here?”

This very question, in the context of absorbent fees associated with the cost of a university degree, is indicative of the demand placed upon individuals. In seeking the services of higher education, $40,000 a year isn’t enough for the institution. They need to know what ELSE you might offer them, what other responsibilities of bringing recognition and private dollars to the university you might be willing to take on during your time there. (Did I mention they are getting $40,000 of your money PER YEAR?) 

You don’t walk into a sandwhich shop, pay for your sandwhich, and then offer to learn how to bake bread for them on the weekends. That $40k a year isn’t a favor, that’s potentially a lifetime of debt. The question should really be turned around:

What kind of job are you going to guareentee me after I give you $160k?

AD SPAMMERS: YOU DO SOMETHING ABOUT IT, BECAUSE WE’RE NOT.

Spam actually takes up the majority of Internet activity, with spam E-mail making up more than 70% of ALL E-mail. Yikes! The hidden cost of spam activity is that to legitimate users and business owners on the internet. As a blogger, the cost to me is actually quite substantial.

The majority of comments I receive are from spam bots and must be monitored closely to keep communications channels open for genuine users. This cost is further expanded by requiring most internet writers to utilize authentication tools that ask users to enter a randomly generated keyword before a comment can be published. Asking users to participate in verification protocols deters them from commented and sharing; it’s just too bothersome.

Dwindling user interaction with blog posts results in less traffic and less sharing of blog posts that help writers generate money and build their portfolios. In this case, the bigger tax is on the freedom of information sharing, as channels for sharing are interrupted and clogged by advertising agendas without regulation. And, because no effective ban on spam advertising exists, the cost of monitoring and filtering such activity falls on individual content creators and consumers.

AUTOMATED PHONE SERVICES

Automated phone services are another great example of how time and monetary costs are passed on to the individual. As cited by Noam Chomsky in one such instance, paying through a company’s automated service is free, while talking to a live human being and paying through that representative will cost you $5 for the transaction.

Convenience once offered to consumers as a cost to private enterprise has now shifted to the individual being served. No better exhibition of exploited convenience can be found than in the infamous “triple service” packages offered by cable companies. Sign up for all three services and pay $85/month (for one year). Try to split up the services or choose LESS services than you need, and you’ll pay MORE. And so, we see that the cost of convenience itself is taken on completely by the consumer.

In this way, private enterprise NEVER has to compromise by allowing the customer to choose only the services and LEVEL of services they need, at a PRICE that’s appropriate. Cable service companies never have to shoulder the cost of lost revenue should consumers choose less services, as this cost is subsidized by consumers who pay MORE for services they don’t need or want.

Could companies offer consumers fair prices for only the services they require? Sure they could. But that would mean accepting the cost of convenience in the form of less revenue, and less predictable revenue streams. They don’t have to do that, though; the consumer takes on the responsibility of subsidizing those costs in the form of contract commitments and packages that extract more money for less value.

FROM JOB TRAINING TO MANUAL TRAINING.

The stories of individuals shouldering the costs of private enterprise are not only those of the consumers they serve, but also the employees that serve them. When I arrived at my new job last year they handed me a binder about 2-inches thick and told me to read and sign my name.

This is the new “job training” of the modern era: teach yourself and sign this form that says you understand everything.

Signing your name on this bottom-line ensures that regardless of how you perform afterwards, your level of skill on the job as an employee is the sole responsibility of yourself and not your employer. Transferring the responsibility of management to the worker is good for business as it absolves the private entity of having to spend money on real training programs. It also cuts the training time significantly, so new employees can stop taking up company time and start making money for the guys upstairs.

The underlying message is: If we don’t train you and you screw up, we can fire you because you signed a paper saying you understood everything. 

“Manual Training”, as I’ve come to call it, also serves employers by creating an air of job insecurity. In traditional job training where the private entity takes on the responsibility of providing instruction, when employees make mistakes, the employers’ training program can come under scrutiny. Employees can be extended the benefit of doubt about the efficacy of employee training programs, and ultimately, the employee experiences little risk to his termination. In today’s new model of manual training, as the responsibility of competency is shifted to the employee, termination becomes an exeedingly swift protocol.

Private enterprise wins two times over with Manual Training: they can fire employees more easily, and they can hire faster, too. With less training time, they no longer bear the cost of “revenue down-time” once incurred by traditional training programs.

RIDICULOUS PASSWORDS

You know EXACTLY where this is going. Let me set the scene for you:

You sign up for some Internet service/profile (not because you want to but because this has become the standard now). After choosing your username, you’re prompted to create a password. This is where all hell breaks loose. Suddenly, that easy-to-remember password you’ve been using since high-school is NOT ACCEPTABLE.

You come face-to-face with billions of dollars worth of technology telling you: Not Good Enough, Bro. You’re then forced to create a password that requires the photographic memory of a savant, including uppercase letters, symbols, and numbers. Aside from the frustration and anxiety you feel about choosing a password you probably won’t remember, there comes the looming question of:

Why?

The universally acceptable reason for this insanity is “Security”. Because sophisticated hacking methods have apparently become “too much” for private enterprise, security is now YOUR responsibility. Rather than spending more on updated security methods and personnel, companies are perfectly content with making the security of THEIR site, your responsibility.

Look, if my password isn’t hard enough that’s my business, my information is in jeopardy. I’ll take on that responsibility. But more importantly, the password I choose has a greater purpose: It’s something I can REMEMBER. What’s the point of choosing a password that I cannot recall? The only point is simply to subsidize the costs of security that would normally be the responsibility of private internet firms.

THE BOTTOM LINE

Ultimately, the discussion of cost comes down to principals of reason. We must ask ourselves as a nation: what is reasonable? Private enterprises, with immeasurable resources, are no longer absorbing the costs of providing convenience to consumers. As Noam Chomsky suggests, the problem is a narrow-minded kind of thinking. Corporate America would do better by society to absorb the costs and responsibilities of consumer convenience, that in comparison, would equal a greater burden to the individual than to the company who serves that individual.


Simply put: As a nation, you don’t ask the most vulnerable members of your population to take on devastating damages that are easily absorbed by more wealthy entities. At the hour of war you don’t send your elderly and young into battle; you send strong and capable soldiers. Relying on the strength and skills of healthy soldiers not only ensures that battles can be won, it ensures that the overall damages to your civilization will be minimum, and that all of your citizens have a chance to survive and prosper.

But in the modern era of economy, this idea has been inverted. The corporate culture and profit-driven strategies of the U.S. have passed the heaviest casualties of economic burden onto the weakest and least able—middle-class citizens. While the strongest and most capable financial institutions experience protection from economic storms, the individuals of the middle-class are getting clobbered in a battle that renders damages from which they nor society can recover.

Matthew Rosario

American / Writer / Musician