It would be easier to sympathize with rich tech entrepreneurs who don’t want to be criticised simply because they are successful if they weren’t also actively trying to make their workers poorer.
I’m referring, of course, to Tom Perkins, the founder of venture capital fund Kleiner Perkins Caufield & Byers, who said recently that progressives are waging a “war on the American 1 per cent” that had parallels to “fascist Nazi Germany.”
Perkins’ company famously backed both Google and Intuit. Both those companies have been sued by the Department of Justice in a class-action lawsuit that alleges they conspired to suppress the salaries of their staff by agreeing not to recruit from each other’s companies — thus reducing price competition. (Perkins himself isn’t accused of having any link to the suit.)
Real-estate billionaire Sam Zell, the co-founder of Equity Group Investments, recently defended Perkins, saying that “the world and this country should not talk about envy of the 1 per cent.”
Yet when Zell bought the Tribune newspaper company, he reduced employees’ 401(k) match from 4% to 3% and switched a 5% contribution on top of that into Tribune stock.
Now consider AOL CEO Tim Armstrong, who told his employees that the company would no longer be making 401(k) contributions in each paycheck, but would instead make one lump sum at the end of the year.
Employees are describing this move as a pay cut — and they are right. They will lose any gains and dividends they would have earned from investments made during the year, and AOL will save the money and earn interest on it in the meantime. It’s a cynical, cheap manoeuvre.
To be fair, Armstrong is NOT one of the executives who has argued that the rich have gotten the sharp end of the stick.
But the larger point is that AOL, Google, Intuit and Tribune are all companies that have made obvious moves to screw their employees.
It’s one thing to suggest that employees not be jealous of the tech rich. But the rich bring criticism on themselves when they deliberately take money from their workers and expect to be respected for their achievements.