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What Happened Today: April 4, 2022
Amazon union’s big win; Musk’s Twitter takeover; Joel Kotkin on the West’s regression
The Big Story
Amazon workers in Staten Island won a vote last Friday to form a union, putting them on the cusp of becoming the first unionized Amazon facility in the country, and setting a new precedent in relations between employees and the largest company in the world. The landmark vote comes after a two-year battle in which the retail behemoth spent more than $4.3 million to counter the unionization efforts in Staten Island and at another warehouse in Bessemer, Alabama—where, in a vote last Thursday, unionization efforts were defeated. The Amazon Labor Union, which got the support of 2,654 workers compared to 2,131 who voted against the union, spent a reported $120,000. The Staten Island facility is one of the largest in the country, employing more than 8,000 workers, which makes the vote especially significant. The campaign to form the union was led by former Amazon employee Christian Smalls, who was fired by the company after leading a walkout at the Staten Island warehouse in 2020 to protest what he said were unsafe working conditions at the height of the COVID-19 pandemic. Smalls’ efforts still have to be certified by the National Labor Relations Board to make the union official but are already being interpreted as a major win for a newly reemergent American labor movement. Like all of the big-tech companies in the United States, Amazon has reaped a windfall in profits since the start of the pandemic as even more retail and recreational activity was driven online. In 2020, Amazon’s profits were up by 84% compared to the previous year. And last year the company again posted record sales numbers, with fourth-quarter sales in 2021 up 9% year-over-year from the same period in 2020. Despite the record-setting profits, Amazon announced that it was raising the price of memberships to its Amazon Prime service due to rising operating costs. Earlier this month, Amazon’s board approved a $10 billion stock buyback, a move that will enrich shareholders but does nothing for the company’s employees or customers. As of 2020, Amazon reportedly employed more than 1.6 million full- and part-time workers.
In The Back Pages: Joel Kotkin on the West’s Great Regression
→ Elon Musk now owns 9.2% of Twitter, according to a regulatory filing published Monday by the SEC, making him the company’s largest shareholder and setting up the possibility for a rebranding that could turn the social media site into a more adversarial free-speech platform. Musk’s enthusiasm for the platform marks a clear reversal from his feelings two weeks ago, when he complained (on Twitter, of course) that the social media company “fail[s] to adhere to free speech principles” and thus “fundamentally undermines democracy.” Since Musk’s big investment, Twitter’s value has soared 25%, making this threat to democracy a solid asset in Musk’s portfolio. There is now speculation that Musk, who once floated the idea of creating his own social media site, is considering playing a more active role in Twitter or even buying it altogether.
→ Viktor Orban will remain the prime minister of Hungary after winning a fourth consecutive election on Sunday. Early polling suggested a close race between Orban and the six-party block that united to oppose him, despite structural advantages in the voting system favoring the incumbents. But Orban’s Fidesz party appears to have won in a landslide, securing 135 out of 199 seats in Hungary’s parliament. Given that Orban is Vladimir Putin’s closest ally in the European Union, his victory Sunday also provides a boon to Russia in its war against Ukraine. When Russia invaded Ukraine on Feb. 24, in the midst of his campaign, Orban made it a major issue by insisting that he would maintain Hungary’s neutrality while his opponents would draw the country into the war against Russia by arming Ukraine.
→ As Russia withdraws its forces from the suburbs surrounding Kyiv, hundreds of bodies are being discovered in what Ukrainian authorities are calling a war crime and Russian authorities are claiming is misinformation. But, contrary to the Russian denials, an analysis of satellite imagery published Monday in The New York Times appears to refute Moscow’s claims that the killing of civilians in Bucha, a suburb of Kyiv, occurred after its soldiers had left the area. “Local civilians were being executed arbitrarily, some with hands tied behind their backs, their bodies scattered in the streets of the city,” Ukraine’s Ministry of Defense posted on Twitter, along with photos and videos of the massacres. Since the Russian army has left, harrowing accounts have emerged from Bucha about mass graves and lines of executed Ukrainians, soldiers as well as civilians, lying in the dirt with their hands bound and eyes blindfolded. One 76-year-old woman spoke of going out during the night, the war still raging all around her, to bury her daughter in the front yard. “There was so much shelling,” she said. “I did not know what to do.”
→ A New York magazine reporter's investigation into the finances of Black Live Matter has not only uncovered that the group’s leaders used money donated to the organization to purchase a nearly $6 million house in Southern California but also found that the group was monitoring critics on social media and using its sway with companies like Facebook to get them censored. For instance, a New York Post article detailing a former BLM leader’s purchase of a different $3 million home has been banned by Facebook’s parent company, Meta, on the absurd ground that the reporting is abusive.
→ Lo and behold, it turns out that despite the tough talk about sanctioning Russia, the United States increased its oil purchases from Russia by 43% between March 19 and 25, according to data in a report by the U.S. Energy Information Administration. Despite a White House ban on energy imports from Russia, the United States is continuing to buy up to 100,000 barrels of crude oil per day from Russia.
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→ Smart interview with Michael Shellenberger, a writer who is now running to become the next governor of California. “Running for governor,” Shellenberger explained, is “just a logical evolution of my advocacy to reform our policies on drugs, mental illness, housing, energy, and education.”
→ Last Friday, the same day Amazon workers on Staten Island voted to create the first union in the company’s history, it was disclosed that Andy Jassy, the tech giant’s president and CEO, made $217 million last year, the third-most of any U.S. executive and 6,474 times more than Amazon’s median salary. Indeed, 2021 saw record-breaking salaries for most business executives at S&P 500 companies; Equilar, a data firm that tracks such information, analyzed executive pay at 196 high-revenue corporations and found not only an average increase of 20% since 2020 but also that the gulf between a company’s median salary and its CEO’s salary has reached an all-time high. According to a report published by the Economic Policy Institute, that difference has increased 1,571% since 1965.
→ The authors of a Goldman Sachs research note are clearly Scroll subscribers who have been keeping up on our analysis here because last Thursday they warned investors—as we have repeatedly warned Scroll readers—that the U.S. dollar’s dominance as the global reserve currency could be in jeopardy. The downgrading of the dollar was spurred by the sanctions regime on Russia, which has had the effect of fragmenting international trade and making some countries less dependent on U.S. currency. “The bank’s analysts, including economist Cristina Tessari, said the dollar faces a number of challenges similar to those faced by the British pound before it declined … in the middle of the 20th century,” according to a write-up in Yahoo Finance.
When the Arc of History Bends Back Toward the Dark Ages
The notion that “the arc of history” favors humanity extends across the political spectrum from George W. Bush to Barack Obama. Yet rather than facing the dawn of a progressive future, we may be entering “the great regression,” a period where the world becomes more hierarchical and feudal, less prosperous, and much less free.
A decade or two ago, optimism was buttressed by the economic boom that followed the end of the Second World War and was further extended by the collapse of Communism. This “end of history” moment seemed to be the dawn of a future that was more like Star Trek, with advanced technologies used to deliver universal prosperity under a regime of enlightened rulers. Instead, today’s new world order is a springtime for dictators, revanchist ideologies, and the pitiless global struggle for supremacy.
In place of the broad-based prosperity enjoyed by Europe, Australia, and North America that gave birth to capitalism and modern democracy, those regions have become more feudalistic, hierarchical, and profoundly unequal. The middle class, which was critical in destroying feudalism and ushering in the prosperity of the modern world, has lost ground to a small aristocracy of financiers, as corporate and tech hegemons have increased their power over the global economy.
Once-dynamic Western societies are now stagnating as they did in feudal times. Median incomes have stayed flat while the populations of post-industrial societies are growing slowly or not at all—a problem exacerbated by the COVID-19 pandemic. The mid-20th-century liberal “golden age” has receded under the rising tide of autocracy. Indeed, according to a recent study by Sweden’s University of Gothenburg, nearly 70% of the world’s population lives under some kind of autocracy, including illiberal electoral regimes, up from 50% in 2011. Belief in democracy is also declining, most disturbingly among young people who are intimately acquainted with the shortcomings of Western liberal democracies but have no historical memory of what life was like under previous autocracies.
Although the united Western response to Vladimir Putin’s invasion of Ukraine offers some hope of a revived liberal alliance, the most likely solutions to the crisis will come from deals struck between monarchs fighting over turf and prestige. While no one is expecting the UN bureaucracy to broker a solution, dictators like Turkey’s Recep Tayyip Erdogan have a vital role to play. At the moment, global oil shortages have already empowered autocrats in Saudi Arabia, the United Arab Emirates, Qatar, and Venezuela. Soon Iran’s mullahs, saved by Europe and the United States, will see their own windfall as Western nations purposely surrender their capacity to generate energy on their own.
The United States’ failure to prevent Russia’s strategic dominance of Europe’s energy sector or China’s relentless drive for global preeminence is not a predetermined fact of history—rather, it reflects choices made by our ruling establishment. Rather than seek, as in the past, to boost the United States’ productive power with investment in manufacturing and energy, corporate and political elites in the United States have comprehensively demonized and dismantled precisely those industries in the name of a green ideology that Joel Garreau calls “the religion of choice for urban atheists.” It is no coincidence that the very industries that tend to spread wealth to ordinary workers, enrich owners, and support an independent middle class are portrayed as being full of deplorables and contributing to the climate apocalypse. Like the early Christians, today’s climate activists employ religion to strangle dissent and control opinion.
By the time Beijing, currently by far the world’s largest emitter, starts looking to reduce its carbon footprint in 2030 after consolidating the production of solar panels and electric batteries, the future will already be firmly in China’s hands. By 2060, when China plans to reach net-zero, a largely deindustrialized West may be little more than a vacation spot for rich Chinese, Indian, Arab,, and perhaps even Russian oligarchs.
By the sixth or seventh century, suggested historian Henri Pirenne, “the very mind of man was going through degeneration.”i Classical civilization was often cruel but bequeathed many of our core political beliefs and produced a wide efflorescence of innovation in mathematics, engineering, science, philosophy, and religion.
Now our universities have become arbiters of a new progressive orthodoxy. The reality of the great regression has, as in the Middle Ages, even affected the sciences. Secure in their wealth, some of the scientific establishments’ biggest patrons, including Bill Gates, openly support groups that promote the idea that science and math are racist. Woke groups like “Shut down Stem” seek to transform math, and even such seemingly innocent fields as astronomy, to redress the supposed sins of the sciences.
Simply put, we are abandoning our cultural heritage just as our adversaries are driven by a need to recover a glorious past. In Turkey, Erdogan pursues the restoration of Ottoman greatness, while China’s Xi Jinping attempts to resurrect the Confucian values of the Imperial period, and in Russia, Putin is desperately gambling on his ability to restore the Orthodox empire of the tsars. Some maintain that these regimes will not be able to compete technologically with democracies, but that overlooks the great past accomplishments of the Soviet space program as well as China’s current success in the critical field of artificial intelligence, which will likely drive the global economy in the future.
The West can overcome the creeping regression to feudalism, but first we have to acknowledge the realities of the age and acquire the courage to resist it. “A man may be led by fate,” wrote the great Soviet novelist Vasily Grossman, “but he can refuse to follow.”
Joel Kotkin is the Presidential Fellow in Urban Futures at Chapman University and executive director of the Urban Reform Institute. His new book, The Coming of Neo-Feudalism, is now out from Encounter. You can follow him on Twitter: @joelkotkin.