Don’t Fall for the Myth of the “Job Creator”

Billionaires like Howard Schultz like to claim that that we should be grateful for all the jobs they create. But the ultrarich don’t create jobs in any meaningful sense — they just reap the rewards of asset ownership and the labor of their workers.

Former Starbucks CEO Howard Schultz arrives to testify before the Senate Health, Education, Labor, and Pensions Committee on March 29, 2023 in Washington, DC. (Anna Moneymaker / Getty Images)

For a brief moment last week, the world was topsy-turvy as former Starbucks CEO Howard Schultz was dragged to Washington and made to answer questions about his company’s flagrant union busting. Led by Sen. Bernie Sanders as chair of the Senate Health, Education, Labor and Pensions Committee, the hearings were a rare example of Democratic politicians putting a billionaire on blast for violating his workers’ rights.

Schultz was having none of it, dismissing National Labor Relations Board findings that Starbucks repeatedly broke the law as mere “allegations” and taking umbrage at being called a “billionaire.” “Yes, I have billions of dollars. I earned it,” Schultz said. “No one gave it to me. And I’ve shared it constantly with people of Starbucks.”

If erstwhile allies of Schultz, like Democratic Washington state senator Patty Murray, found themselves forced into taking the side of his employees, the beleaguered Starbucks CEO did find allies in the Republican senators present. Utah senator and former private equity executive Mitt Romney told Schultz he found it “somewhat rich that you’re being grilled by people who have never had the opportunity to create a single job.” Sen. Rand Paul of Kentucky waxed poetic in defense of the billionaire class: “Ayn Rand’s Howard Roark points out the ingratitude that man has for the entrepreneur. . . . Thousands of years ago the first man discovered how to make fire — he was probably burnt at the stake he had taught the others to light.”

Here, Schultz and his newfound friends were reciting standard-issue justifications for the obscene wealth of the ultrarich and their often-unchecked tyranny in the workplace. Yes, billionaires have more money than most of us could ever possibly imagine, but that’s because they’ve earned it. They’ve earned it by being “creators” of ideas and jobs, from which their workers, and everyone else, benefit.

Though this story might help billionaires like Schultz and multimillionaires like Romney sleep at night, it is, like most bedtime stories, a fantasy. The uber-rich do not “earn” their fortunes through Promethean contributions to humanity — they do it by being lucky enough to own assets, which allows them to get rich off the labor of the workers who are actually making things. Chicago punk rock legend Steve Albini, responding to Schultz’s testimony on Twitter, put it well: “Nobody earned a billion dollars. It’s literally impossible to be paid for work and end up with a billion dollars. You get a billion dollars by having other people work for it, then taking it.”

The Myth of “Job Creation”

Ironically, Romney’s defense of Schultz gives a clue as to what’s wrong with the myth of the capitalist as heroic job creator. Romney claimed that the Starbucks exec was “being grilled by people who have never had the opportunity to create a single job.” This strangely passive construction hints at the fact that job creation is not something “entrepreneurs” do because they are especially talented or hard-working, but rather something that they, unlike others, are fortunate enough to find themselves in a position to do.

What allows someone to be a “job creator”? The good luck of being an owner of either “means of production” like land, factories, and productive machinery or of the money necessary to purchase those items. In a capitalist society, the owners of means of production get to determine how those productive assets are used: they can decide whether to use them to produce crops, or shoes, or cars, depending on available natural resources and technologies. The capitalist then hires other people (workers) to do the actual labor with those assets — to farm the land, say, or work the machines in the factories — to produce goods that the capitalist then sells on the market. After paying the workers as little as he can get away with out of the resulting revenue, the capitalist keeps the rest, either reinvesting it into his business or using it for his own consumption.

So to say that the capitalist creates jobs is misleading. What creates jobs is simply the decision to employ productive resources and to hire people to work on those resources. But the resources could be used by workers to produce goods and services without the capitalist entering the picture at all. Workers, or the broader public, could collectively own and decide how to use productive assets, as socialists argue. And we already see capitalist-free production and “job creation” on a smaller scale in worker-owned cooperatives and sometimes on a large scale with state-owned enterprises.

What billionaires like Schultz do, in a capitalist society, is hoard control of the means of production. They then use that control to invest in whatever is most profitable — regardless of the consequences for health, safety,  general social utility, or even the survival of the planet. The people who actually make things — the workers — are left without a say over what they make or the conditions they work under, while giving up most of the fruits of their labor to their capitalist overlords. And when those workers try to organize collectively to demand higher wages and more of a say at work, petty tyrants like Schultz break the law in an effort to crush their attempts to unionize.

Do Capitalists Deserve Their Power?

Free-market ideologues would probably respond that capitalists deserve their assets and the control over economic decision-making that this gives them. Capitalists acquire assets through frugal saving, hard work, or coming up with groundbreaking ideas, they might argue. Why should society deny them the freedom to use their justly acquired assets to start a business or acquire shares in an existing enterprise?

The first problem with this argument is that many capitalists do not become owners through thriftiness or honest work. Many simply inherit wealth from their families. Others acquire it through defrauding others — tricking other capitalists, for instance, into investing in questionable or downright fake business ideas. Being lucky enough to have a rich parent, or shameless enough to deceive others out of large sums of money, shouldn’t entitle one to decide how society disposes of its wealth.

Occasionally one comes across a true rags-to-riches story, where a person starts out at the bottom of the class hierarchy and manages to scrimp and save enough start-up capital to launch a successful business or invest in others’. But it doesn’t follow from stories like these that the superrich should be given the power of job creation and all that comes with it. Even if a person works hard to become a capitalist, why should that effort be rewarded with the power to personally decide how society’s resources are used and to rule over employees as despots? No matter how they got there, it’s unclear why owners should be able to acquire enough wealth to dominate the political process and effectively make a sham out of our democracy.

Socialists say: they shouldn’t. Everyone should have equal opportunity to contribute to major economic decisions — including what is produced and how — and everyone deserves to be rewarded for the fruits of their labor, including the workers who are mercilessly exploited under our current system. We should stop simping for parasitic “job creators” and demand that their wealth and power be shared with everyone.