Explaing Our Economy in “-isms” and “-izations”

Thanks to Henry Ford and his meticulous methods to increase the productivity of workers on his assembly line, the economy transformed from one of craft production to one of mass production. In addition to “Fordism,” the past 100 years in the US economy can be explained by using “Levittownization,” “McDonaldization,” and “WalMartization.”

Ford perfectly implemented Taylor’s ideals of rational organizations in order to provide cars to the masses. Taylor’s scientific management proposed that scientifically determined procedures would allow employees to work at peak efficiency, in return for top wages. In addition to standardized labor, Ford added specialized machines, interchangeable parts, and conveyor belts. In 1914, after the assembly line had brought Ford much success he came up with a new idea in order to cut down on the wear and tear of workers; he began paying employees $5.00 a day (more than doubling the average worker’s pay) and cut the workday down from nine hours to eight. By standardizing the product, Ford was able to cut costs substantially (from $780 in 1910 to $360 in 1914) giving the common man the opportunity to buy a car.

As Ford had minimized the per unit cost of a car in the early 1900’s, William Levitt did so with the price of houses in the 1950’s. Levitt’s vision of suburbia transformed America to how we know it as of today. Before WWII home building was a part of the dying art of craft production, each home having a unique design. As soldiers returned from war, families dreamed to own their own homes away from the congested cities. Levitt made these American Dreams happen by standardizing home building. In Levittown, there were two styles of homes offered and could be built at a rate of 18 in the morning and 18 at night. For $100 down, a family could have a house outfitted with heat, a garage, a washer, and a stove.

In the 1950’s the common man could already own a car and a house affordably, and soon he would also be able to go out to eat, all on a tight budget. Ray Kroc founded McDonalds in 1955 and it spread like wild fire across the United States. McDonalds did for the food industry what Ford and Levit had done for the automobile and housing industries, and what Sam Walton would shortly do for retail.

WalMart is the most recent company to revolutionize the United States’ economy. The company is able to offer affordable retail products and groceries to many Americans.

Wal-Mart’s prices are about 14 percent lower than other groceries’ because the company is aggressive about squeezing costs, including labor costs. Its workers earn a third less than unionized grocery workers, and pay for much of their health insurance.

Each employee executes a specific task that allows the company to run efficiently. Competitors often have a tough time matching the prices of WalMart because it is difficult to keep their costs down.

Ford’s model gave rise to giant organizations built upon functional specialization and minute divisions of labor. These companies are each rational organizations as Weber has defined. Each has a clear hierarchy with defined goals, and workers have specialized tasks. But how “rational” (using the layman’s definition of the term) are the employees? Barbara Ehrenreich describes how difficult it is to work for such a company in Nickle and Dimed. Every day performing a monotonous specialized task all for a mere minimum wage. Is there really nothing else? What will it take for these workers to break the cycle? And, are companies like WalMart and McDonald’s just making it harder for minimum wage workers to get out?

4 Responses

  1. I liked this entry, especially bringing up Levitt town. You raise some interesting questions, especially “And, are companies like WalMart and McDonald’s just making it harder for minimum wage workers to get out?”

    In my opinion, minimum wage workers are stuck in a cycle that can only be broken through education as well as dedication. I understand that many come from disadvantaged backgrounds and I feel that Wal-Mart and McDonald’s provide the lowest level of employment possible. Without institutions that pay for unskilled labor, where would the unskilled work?At least Wal-Mart and McDonald’s have some form of health care, where as some other employers do not give any benefits. People who find the the unskilled sector unsuitable should attempt to increase their level of education or become reliable employees that will be able to secure a better job in the future. I understand that it is difficult, possibly unfair or even cynical, but I feel it is not Wal-Mart’s fault.

  2. I am in agreement with what Evan said. Education seems like the only effective way to break the cycle of rational organizations and minimum wage employees. In rational organizations, employees seem to be completely powerless partially because of their lack of education. As we read in Nickel and Dimed, Wal-Mart is telling their employees to not form Unions. With a little bit of education, employees of Wal-Mart would know the reason Wal-Mart does not want them to unionize. They would also learn how to protect themselves against large corporations—for instance, what to do when Wal-Mart fails to compensate for overtime, or offers overpriced health insurance.

  3. I also would like to agree with Evan and Kelli. I am currently enrolled in a capstone course called “Commercialization of Higher Education” and we place a good deal of concentration social class and how it effects the choices they make. In a documentary we recently watched (called Decling by Degree), we were able to see how a college student was trying to survive off a job that paid a little over minimum wage. She was trying to become the first person in her family to attend college, but it was not going to be a walk in the park. Her job had her working the night shift from 10pm-6am and then she had to fit classes, studying, homework, and naps throughout the rest of her day. As the documentary ended, it informed the viewers how that she was unable to carry the burden of both school and her job, and she was forced to quit. This is a major problem in our country today. Yes we can say that with education people can break the barrier of minimum wage jobs, but how do they break the barrier of paying for this education? The economy has left people with less money in their pockets, yet the tuition for higher education continues to rise. Even financial aid is not a large enough figure to cover costs, and loans just lead to more issues and problems of debt.

    So what am I trying to suggest? I’m actually not too sure. I agree that education is the way to go, but reforming the higher education systems is going to have to come first. Who are the employees in Wal-Mart? They are typically from lower social background, and would never dream of affording college. For right now, Wal-Mart is the best source of income they can get for the level of educational background they have. Something has to be done on the educational level in order to allow low class workers to become a part of it.

  4. I agree with Evan’s argument that the despair of low-wage workers at Wal-Mart is not entirely Wal’Mart’s fault. As Nickel and Dimed pointed, perhaps the greatest difficulty facing the low-wage workers is lack of affordable housing. An extra dollar-an-hour from Wal-Mart will do little to help Wal-Mart workers find better housing options in a safe and geographically close location. The cycle of low-wage jobs is devastating. It is a system that is organized beyond the wage-earners control that allows little time for outside interests, including further education. As mentioned above, in many ways it is the current organization of American cultural “isms” and not Wal-Mart per say that is responsible for the desperate situation many face in this country.

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