Ratepayers: Everyday Life in Late Industrialized Capitalism
24 June 2010
We are no longer proletarians, we are ratepayers. Allow me to explain.
In the largest and most robust economies in the world today, the consumer sector of the economy is not something trifling, but represents a considerable part of market activity. By some accounts, consumer spending in the US constitutes a third of all economic activity. This is an enormous amount of money, and there is a sense in which it drives the economy. When consumer spending slows during a recession, businesses feel it, and they not only feel it here in the US, they feel it around the world, wherever goods are produced that are ultimately retailed in the US market. When businesses feel the pinch, they slow their spending also, which often involves layoffs, which reduces the amount of consumption in the economy, and so goes the vicious cycle of economic downturn.
Strange though it may sound, legitimate businesses and scam artists are essentially engaged in the same enterprise. Both want to get as much of your money as they can. While legitimate businesses are offering a legitimate product or service whereas the scam artists are not, this distinction can be merely academic. One can lose as much or more money to legitimate business enterprises than one loses to a scam artist. Once scammed, one is not likely to give the scammer more money, and one is more generally aware of being scammed and therefore a little less likely to be taken in by another scam artist. Legitimate businesses, however, with their facade of legality and legitimacy, can continue indefinitely with deceptive and abusive business practices, and often we find that we are more or less forced to continue to do business with them. The credit card company adds fees and extra costs, but we need the use of our credit, so we pay it, even when it makes us angry to do so.
There is no more lucrative situation in the world than to be in receipt of regular payments from regular ratepayers. Where these payments are automated and debited from a bank account or credit card, the business taking in these payments can calculate how much money they will have coming in. They can also engage in dishonest business practices (but perhaps legal in a flimsy, legalistic sense) such as making it all-too-easy to sign up for some regularly paid service, and then making it terribly difficult to get it stopped.
A couple of months ago I noticed a debit of about $25.00 from my bank account. I took the statement into the bank, and showed it to a banker, saying that I had never approved the debit (I could say this with complete confidence because I have never allowed a single automatic deduction from my bank account). While I was in the bank, the banker called the number on the statement of the organization that deducted the money. The person on the other end of the phone claimed that I had given the go ahead for this charge a year previously. I told the banker that I wouldn’t dispute the charge if they could show me something with my signature on it. Of course, they couldn’t show me anything, because I hadn’t signed anything. So the bank filed a formal dispute of the charge. I apologized to the banker for taking her time for such a small amount of money, but explained that it was the principle of the thing that bothered me.
It is easy to see this company’s game. If you can get a million people to give you $25.00 dollars per month, you have an income stream of $25 million per month, $300 million per year, or more than a quarter of a billion dollars. This is serious money. If you can automate it, find some sneaky way for people to agree to a charge without realizing that they have agreed to the charge, this money is just flowing in with glorious predictability every month. I wouldn’t mind having a share in an enterprise like that. Probably many people don’t notice the change. Probably some who notice the charge and don’t recognize it, don’t bother to dispute it. And in a country of 300 million relatively well-off citizens, it is not unthinkable to get a million people paying into something, as that is one out of every three hundred people, a third of a percent, which would be a reasonable response rate for some kind of underhanded and deceptive sales pitch.
This is what it means to be a ratepayer. Your income is extremely important to all the businesses for whom a part of your income is their income. You work and earn money, and then you distribute the money you earn among many different vendors. It is the goal of the vendor to be among those on the receiving end of your regular payments, as it is your goal to be on the receiving end of a regular income. You need the money. They need the money. They need you. They need to convince you that you need them.
Under the agricultural paradigm, especially in its earliest and least sophisticated iterations, the bulk of the population would never have a “job” in the sense that we have jobs today other than working on the farm on which they were born. And such a worker would never have wages, and possibly never see money. The agricultural produce of such workers was the currency of the time, such that wealth in the pre-industrial age was often described in terms of the amount of land one possessed, the number of tenants on the land, or the expected annual yield of the land.
Now instead of almost everyone working the land in a system not far advanced beyond subsistence agriculture, almost everyone has a job, and almost everyone has some kind of regular income. Everyone wants a piece of this income, however they can get it, because your regular income then becomes their regular income.
Legitimate ways of acquiring ratepayers are obviously far superior to illegitimate methods such as described above in regard to the debit from my bank account for a bogus insurance policy that I did not want and to which I did not agree. Illegitimate ratepayers ultimate get out from under their burden, whereas legitimate ratepayers are the contemporary equivalent to indentured servants. Ultimately, the best arrangement for an enterprise is to have willing ratepayers who want your product or service so badly that they are willing to bid up the rate that they pay. If you have a product or service that is so desirable that teenagers will work after-school jobs in order to afford what you are selling, then you are in a very enviable position.
When I wrote the above I was thinking about contemporary cell phone companies, except that cell phone companies don’t even want to sell you cell phone service anymore. If you go into a cell phone store and simply want to renew your plan and get a new phone, they will tell you (with a certain studied disdain in their voice) that you can’t just get a new phone from the store. You have to order a new phone online. In the store, they only sell the latest and the greatest. And the store is booming. Every time I go to the cell phone store you have to take a number and wait twenty minutes at least. What is everyone waiting in line to get? The newest iPhone or Droid or what-have-you. And these new phones, albeit reasonably priced if you sign a two year service contract (another ultimate guarantee of regular income for the provider), since these latest and greatest phones have increased functionality you have to upgrade your service. That means that instead of paying $40 a month for your cell phone, you can pay $60 a month a get some kind of basic connectivity to the internet, or if you are willing to pay $80 or more per month you get all the bells and whistles in addition to your fancy new phone.
These folks who run the cell phone business have the world by the tail on a downhill pull. They are in the right spot at the right time. They have what people want, and as a result, they have ratepayers who willingly pay for more products and services. Supply must struggle to keep up with demand, and therefore what supply there is can be sold at a premium. For those who placed their financial bets wisely, this must be paying off handsomely for them. For the rest of us, we are the ratepayers.
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