Monday, November 28, 2011

The Safeway Girl vs Lionel Barrymore

I started to respond to this photo on Facebook, where one of my friends had posted it, clearly in support of its message, which appears to be that Safeway is raking in tens of billions of dollars in order to pay its CEO an astronomical (and probably undeserved) salary, and to keep their warehouses unsafe and dangerous places to work. I decided to write something a bit more trenchant than "Oh, balls!" but it quickly became clear I'd need a little more space to make my points, so here goes.

(Let's leave aside for the moment the appeal to our heartstrings, the sad-yet-feisty little girl with the eerie stare and the unemployed daddy, holding up the damning Safeway financials -- which I don't for a moment believe she printed -- before going out to clobber Claude Daigle and steal his penmanship medal. Oh, wait, that's "The Bad Seed"...)

First of all, while it's true Safeway made over $41 billion in 2010, it's also true that their cost of revenue -- i.e. cost of doing business, buying and shipping the food, paying for the electricity, stuff like that -- was: (the following amounts are in millions) $29,442.5 , leaving a gross profit of $11,607.5. Then there were general and administrative expenses, like salaries for the 180,000 (give or take) people Safeway employs (most of whom probably have families), which came to $10,448.1, leaving an operating income of $1,159.4, a before-tax income of $881.2 million and an after-tax income of $590.6 million. It costs money to run the business and pay all the people and pay the rent so they can sell the food and other goods at reasonable prices at their many stores, food and goods which are purchased by many millions of families and individuals considered part of the "99%".  (Figures from Money Central at

As for what the CEO took home, the almost $11 million Steve Burd earned in salary and benefits and bonuses and whatever, amounted to something just shy of .0027% of Safeway's gross profits in 2010, so it's not as if he's robbing them blind. They're paying him what they think he's worth, just as in the same year the LA Lakers paid Kobe Bryant over $21 million, and the New York Yankees paid Alex Rodriguez $33 million. Why don't people get all hot and bothered over the salaries of sports stars? (For that matter, Congress is chock-a-block with "fat cat" millionaires, many of whom have recently been accused of insider trading: where's the outrage over that?)

In any event, what a CEO takes home and the value of his house (or his car or his wardrobe) are immaterial. Sure, the figures may be cause for envy (I won't see that kind of money in my lifetime), but it makes no difference, unless you believe that it's all a zero-sum game: that someone's success automatically means someone else goes hungry or is otherwise impoverished. But it isn't. The truth is, like it or not, most wealthy people aren't mean, greedy, grasping fat white guys in ill-fitting three-piece suits, chomping cigars while kicking widows and orphans for sport, (think of the Lionel Barrymore character, Mr. Potter, in "It's a Wonderful Life), who just happened to fall into huge vats of unearned cash -- as suggested by those who continually refer to wealthy people as "fortunate".  Oprah Winfrey is worth about $3 billion, but it's my opinion she didn't just get lucky. She's a smart, keen businesswoman. Talented yes, but talent alone isn't enough. She's worked hard, and continues to do so and along the way she's changed peoples' lives and employed God knows how many in her various businesses.

As for the unsafe warehouse and the charge that Safeway would rather pay lawyers so they can keep their warehouses dangerous: I don't know the facts of the case, but it's safe to say that no company is going to deliberately maintain unsafe conditions, deliberately putting employees in danger of injury or worse. A sentence like "Safeway would rather pay lawyers to fight OSHA than make their warehouses safe..." is ridiculous on the face of it. It's like saying some restaurant would rather pay lawyers than serve food that isn't riddled with salmonella. If you ask me, anyone who'd make a claim like that is probably leaving something out of the story of how and why Daddy got fired.

Too much public policy and debate nowadays is based more on emotion and "feelings" than on facts. Just because a lot of people don't like capitalism doesn't make it wrong or evil, and demonizing a company because it makes a lot of money doesn't take the place of understanding -- even very generally -- how business works. It's easy to sit around and say your student loans should be forgiven and the minimum wage should be $20 or $30 and some of what "they" have should go to "them" or "us" because it's "fair". But who decides what's fair? What's fair to you might not be remotely fair to me, so I'll just take some of what you've got, okay? It isn't "fair" for you to have two cars, so I'll get the government to take one and give it to me.

No one wants to talk, discuss, engage, listen or learn. Or take a few minutes to do a simple Google search for some facts and figures. It's all anger and name-calling, or sad puppy eyes and pictures like the Facebook Safeway girl that get the attention. And I think that is at the heart of what's taking us on a long walk down an ever shorter pier. Sorry to say.


  1. Fred you rock. Could not have said it better myself. And you paint a mean scarf.
    Much love and merry Xmas.

  2. PS. Where is the outrage at out slimy politicians. Are we that jaded and cynical, or more dumb self-involved and numb. Too busy watching wives of Haddonfield.

  3. Hi, I'm Mary. This is my daughter. What would you like to know?