Mass layoffs are just business, right?

Twitter burning... Just business

Twitter is in an uproar, because Elon Musk bought Twitter and is instituting mass layoffs. But that’s nothing personal, right, it’s just business? Maybe it is, but what does that really mean?

Some context

Twitter hasn’t been profitable for the past few years. The company has a revenue of about 5 billion dollars a year. Unfortunately, its costs are even higher, leading to a net loss of 3 million per day. That’s an insane amount of money. Any company making less than their expenses is in trouble, figures like this are pretty bonkers.

So, that something has to be done is reasonable. And cutting down on personnel is a painful but valid approach. The way Musk is handling it is pretty egregious, if the things I read in the media are true — and I don’t see any rebuttals. People are being forced to work massive overtime, forced back to the office, and if they fail to do so, they’re fired. Musk chose to fire people on an individual basis in an attempt to circumvent mass layoff laws in California. He’s probably violated labor Dutch laws by firing everybody at a Dutch Twitter subsidiary en-masse without warning. And so on.

This is all pretty sickening, but I don’t want to talk just about Twitter. The thing is, this happens a lot, and you often hear ‘it’s not personal, it’s just business’. Is it, though?

It’s not personal

I suppose it’s the intention that it isn’t personal. A business needs to make money and that sometimes means firing people. However, that’s still personal by definition. Somebody makes a choice to fire a specific person.

The consequences for that individual can be grave. They might have moved to the area they work. They may have a family they need to provide for; a mortgage. And getting sacked isn’t a picnic psychologically. The fact that you were doing good work but the company had to cut costs changes none of that.

Another thing is that companies still choose which people to fire. Unless the entire business goes under, some people can stay and others must go. Unless they decide by die roll, that sounds like a pretty personal choice.

Of course, there can be circumstances that make it less personal. About ten years back, I was approached by a startup. They wanted me to come work for them. I had a phone call, and it soon turned out we didn’t click. I was in the process of buying a house, and wanted to have a child and work regular hours. They wanted somebody to go all-in to get their start-up off the ground. So we both decided it wouldn’t work and we went our separate ways. I think about that sometimes, but I never really regret it, even though that startup is now worth over a billion euros.

The difference is really the power balance. If you are on an equal footing, parting ways is less personal. Firing free-lancers (those free-lancing by choice, not forced into it) is truly less personal. You don’t hire them, your hire their one-person company.

In contrast, if give somebody a job, you hire them to personally do the work. That’s how employment is written in (Dutch) law, and that alone makes it personal.

It’s just business

The other side of the equation is of course the need to fire people. That comes from a need to make a profit, usually for shareholders. And that is an interesting discussion by itself. Somewhere down the line, we’ve accepted that everything need to make a profit. That everything’s a business and needs to grow. That we need to make money for shareholders. Elon Musk financed parts of the Twitter take-over with loans that Twitter itself now has to pay back.

You could define the goal of a business differently.

I work at a company that is technically a club, with several million members. The money doesn’t go to shareholders. It doesn’t even go to the members. All profit is used to fund projects to better society. You could also define a company’s goal to keep as many people as possible employed. Or to provide a certain product or service as cheaply as possible. But capitalism doesn’t accept that. Companies have to make a profit, and have to grow. The government actively uses taxes to force companies to grow, to borrow money, to fit into that capitalist mold.

Isn’t it interesting that Twitter can choose to fire half their staff but they cannot fire their shareholders or their bank? ‘Sorry, we’re not making a profit, it’s nothing personal, but we’re not going to pay these loans back.’ That’s unacceptable, and punished by law, but firing people isn’t. But we pretend the shareholders are the ones taking the most risk.

We’ve geared up a society where property is legally more important than people.

Power balance

In the end, it comes down to a power balance. As I stated above, when you are on an equal footing, parting ways is fine. Firing people isn’t a very painful thing if you have another job lined up, or social security safety nets in place.

But, of course, we’ve been eroding those for decades, in most of the western world. We’ve changed the laws to funnel money to shareholders and pretend that there isn’t enough to fund social security. Because it helps companies if there is no safety net. The larger the labor pool, and the worse the social safety net, the lower the wages can be, and the more profit you can make. It puts more power into the hands of those with money.

As Jim Sterling often says ‘they don’t want some of the money, they want all of the money’. We’ve set up a society where the power lies with whoever has the most money. And we’ve largely completed the feedback loop where those with the most power can also automatically make the most money. That feedback loop pushes societies to becoming oligarchies.

Elon Musk has used billions of dollars to loan even more billions, to buy Twitter and have Twitter itself pay for their own takeover. He’s now going to use laws and profit-mongering to make more money, over the backs of tens of thousands of people’s lives. Like he did before and will try again. And he gets the power to influence elections to boot. The past has proven he will use that power to undermine people’s rights even more.

Fighting back

So what power do the rest of us have? Democracy is always about the power of numbers. If large numbers of people unionize, businesses can be brought to heel. Voting a government in place to fix things can change things. There are a lot more poor and middle-class people than there are ultra-rich people.

Unfortunately, a century of capitalist indoctrination and misinformation has convinced a lot of us that those mechanisms to take money from the rich will actually hurt poor and middle class people. A kind of Stockholm syndrome for capitalism. But in reality it’s only because the entire system has been rigged to push profit losses to those poor and middle class people and the profits to the rich.

Of course that might lead to a darker outcome eventually. People can also pick up pitch-forks and make their displeasure known by bringing down the system. It’s already happening. That results in suffering, with time periods like the french revolution and russian revolution standing out. The wise lesson for the all of us should be that pushing the masses to breaking usually leads to death and suffering. Bad outcomes for all are almost guaranteed.

So, vote, unionize, and speak out against mass layoffs.

Martin Stellinga Written by:

I'm a science fiction and fantasy author/blogger from the Netherlands