Montana Viewpoint: Why not run a business the right way?

Ford

An early assembly line at the Ford Motor Co. Henry Ford knew how to keep his workers happy.

Usually, for my column on Labor Day, I write (maybe lecture) on how we should remember that what we now take for granted—the eight-hour workday, the weekend and safe workplaces—were given to us by people who often gave their lives so that the lives of others might be better.

I might mention child labor laws that stopped the practice of children as young as 8 years old working dangerous jobs for 12 hours a day, seven days a week, or the Triangle Shirtwaist (blouse) Factory fire in 1911, where 146 young workers, mostly immigrants, burned to death or jumped to their death to escape a fire in a factory where an exit door was locked to prevent theft.

I could have mentioned the Ludlow Massacre at John D. Rockefeller’s coal mine in Leadville, Colo., where the Colorado National Guard was called in to stop a strike for the eight-hour day, and two women and eleven children, among others, were killed.

Jim Elliott

Jim Elliott

And that’s the column I was writing when the thought came to me, “So, what’s changed?”

Most of those perils have just been moved overseas, along with the jobs, and in America working people are still faced with a corporate greed that keeps profits high and wages suppressed. It doesn’t have to be that way, and in all too rare instances, it isn’t.

Henry Ford once said that the best cost-cutting move he ever made was to give his workers a raise to $5 a day at a time when average manufacturing wages were half that. Production soared, profits doubled in two years and employee loyalty was almost absolute.

“It is our belief that social justice begins at home,” Ford Motor Co. treasurer James Couzens said. “We want those who have helped us to produce this great institution and are helping to maintain it to share our prosperity. We want them to have present profits and future prospects. Believing as we do, that a division of our earnings between capital and labor is unequal, we have sought a plan of relief suitable for our business.”

Ford issued the raises on Jan. 5, 1914. On April 20 of that year, John D. Rockefeller unleashed his company guards and the Colorado National Guard on striking miners and their families, causing the deaths of at least 19 men, women and children.

As a customer, I have a nosy habit of asking the people who serve me how they like their job. Generally the response is something like, “It’s a job.” But occasionally I hit the jackpot. “I love it here!” a young man at Costco said with remarkable enthusiasm, “I’ve been here two months and I’ve already got full health care coverage and I’m making lots more than I did at Albertsons.”

These examples have led me to believe that there are two ways to make money in business, the easy way and the hard way.

The easy way is to treat your employees as an asset; pay them well, treat them well, and they will reward you with loyalty and honesty. The hard way is to treat employees as a liability, a necessary evil. This is accomplished with low pay, lack of benefits and a lack of respect. That kind of treatment reaps low morale, employee theft and high turnover. The costs of theft and retraining alone could cover a wage increase that might eliminate those behaviors.

I also hold that either business model, the easy way and the hard way, have similar costs and similar profits, so my question is, why do it the hard way if you can make the same amount of money by treating employees well?

Jim Elliott is a former chairman of the Montana Democratic Party and a former state senator from Trout Creek.

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