Sunday, 29 September 2013

The glass floor

Today I’m going to share what I reckon is a mucho nifty way of both conceptualising and summarising the place of the ruling class in capitalism today. It stems from conversations with a work mate who was moaning about what had happened to a team he’d previously built up from diddly into c. a dozen effective staff.

The mate moved on to be replaced by someone variously known, depending on who you spoke to, as “jingle-jangle” and “that useless bastard”. Looking on from the other side of the office, the mate asked why, given all the frustrated people leaving the team and its new found inability to do much of anything, jingle-jangle was still in place.

To us it looked like what we eventually called a glass floor was in place, one that protected as it held in place this uniquely incompetent fecker and stemmed from the self-interest of his boss; the sudden increase in staff turnover was cast as a broader problem to explain the change in output that could only be resolved by recruiting more i.e. growing the boss’s existing empire. Plus, to say jingle-jangle was useless would be to call the boss’s judgement into question given he'd chosen him for the job in the first place.

What I took away from this specific example was the broader notion of how within organisations power and self-interest combine to create a “glass floor”; an institutionalised and carefully designed means of protecting those at the top from the vagaries of capitalism. I reckon the term chimes because we all know about the glass ceiling, which, when you think about it, must look like a floor to those looking look down upon it.

It’s also, I reckon, more salient than the notion of a “glass ceiling”; the latter is all about gendered cultural processes, whereas the former is about concrete, documented arrangements. To give an example, people talking about the glass ceiling refer to amorphous things like off-puttingly all-male environments, whereas I can point you to the retirement packages male and female executives get and their removal, after they turned out to be profoundly shite, seen across banking following the credit crunch as evidence of the glass floor.

And the glass floor has broader implications when it comes to understanding how capitalism has worked in recent years. By getting in consultants to build them, executives, at least in banking, were insulated from the consequences of their actions. A bank does well? The execs win big. A bank does badly? They still win i.e. the glass floor removes one of the primary justifications for economic inequality in capitalist society; that it creates incentives to take risk and disproportionately rewards successful  risk takers  or as George Osborne (!) just put it "My parents planned carefully, took a risk, and set up a small manufacturing company more than forty years ago. The company grew. Employed more people. …. I will always be on the side of those who use their savings, take a risk, and put everything on the line to set up their own company."

With a glass floor in place, there are no risks for those in charge or to be more precise risk has been rendered asymmetric; they reap all the benefits whereas we’re subject to any of the negative consequence i.e. those in charge have all the incentives and no disincentives to take risk.

This aspect of the glass floor has had an obvious ideological influence; in banking and big organisations more generally, instead of risk different reasons are typically used to justify elite pay; executives need to be paid shed-loads of cash because we need their strategic leadership and vision while investment bankers deserve the big bucks because they make so much money for their employers i.e. the creation of the glass floor has pushed notions of risk and reward into the background because when you’ve a 7 figure pay off in your employment contract and however many million in an offshore savings account, share options or piled up in a personal pension pot (or all four), you simply aren’t taking any meaningful risks.

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