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Month: May 2016

Vouchers Subsidizing Education Failure

Posted on by Isaiah J. Poole
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poole-60x60The false god of school vouchers has been unmasked once again, this time by a Brookings Institution study that says students in Louisiana and Indiana using vouchers to attend private and religious schools ended up doing worse on reading and math scores than their public school counterparts.

“The magnitudes of the negative impacts were large,” said the study on “The Negative Effects of School Vouchers,” written by Mark Dynarski, a fellow with Brookings’ Center on Children and Families. They also could not be explained away by the nature of the tests the children were taken or by some notion that some of the voucher children had been pulled away from above-average public schools.

Rather, the conclusion that these results point to is that “our historical understanding of the superior performance of private schools is no longer accurate,” Dynarski writes.

The facts in this report strike at a core argument behind the conservative drive to defund public schools and to promote “school choice” to parents, using taxpayer dollars to pay some or all of the costs of a private, often church-based, school. Sometimes invoking the language of the civil rights movement, these voucher programs are defended as ways to liberate students from the mediocrity of public schools and give them the opportunity to get higher quality schooling that equips them to succeed, including if they face barriers of race or class.

Here’s the reality, according to the report: “In Louisiana, a public school student who was average in math (at the 50th percentile) and began attending a private school using a voucher declined to the 34th percentile after one year. If that student was in third, fourth, or fifth grade, the decline was steeper, to the 26th percentile. Reading declined, too: a student at the 50th percentile in reading declined to about the 46th percentile. In Indiana, a student who had entered a private school with a math score at the 50th percentile declined to the 44th percentile after one year.”

Fifteen states and the District of Columbia has school voucher programs. The District’s program is unique in that it is a federally funded (and for many D.C. results, unwanted) intrusion into the city’s affairs. Vouchers have recently made news in North Carolina, where the state legislature is considering a $10 million increase each year in its $12 million budget for the program. That would in 10 years increase the school voucher budget to $135 million.

As Dynarski notes, comparisons of how well students using vouchers to attend private schools in all of these states have done to public school students “have reported mixed results on scores.” But what is remarkable about what the Brookings study saw in Louisiana and Indiana is that earlier studies have not reported “significant negative effects on test scores.”

“In education as in medicine, ‘first, do no harm’ is a powerful guiding principle,” Dynarski concludes. “A case to use taxpayer funds to send children of low-income parents to private schools is based on an expectation that the outcome will be positive. These recent findings point in the other direction.”

But perhaps what is also being unmasked here is that the school voucher movement is not all about academic excellence, at least as education policymakers and experts think of it. Jeff Bryant exposed this several weeks ago in his extensive review of voucher programs and the instruction that gets subsidized by them. An editorial published recently in The Washington Times offers a window into what’s really driving the voucher movement, as it touts vouchers as a way for parents to avoid schools with such mandates as allowing transgender students to use the restrooms that conform to their gender identity. Instead of having to send their children to “schools which they believe promote unsafe and immoral behavior” – presumably such as respect and understanding for people who are different from themselves – the government can instead subsidize “the freedom to choose” a “morality” of intolerance.

But tax dollars should not be subsidizing ignorance of the basic facts of life – whether that ignorance is of how to solve a math equation or how to deal with children who don’t fit our false notions of a gender binary. At the very least, parents should have a fact-based debate of what we’re actually buying with school vouchers, not one argued on faith without evidence.

This blog originally appeared at ourfuture.org on May 26, 2016, Reprinted with permission.

Isaiah Poole Worked at Campaign for America’s Future, attended Pennsylvania State University, and lives in Washington, DC.

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Stakes For All Workers Remain Huge In Verizon Strike

Posted on by Dave Johnson
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Dave JohnsonNOTE: Shortly after this article was posted, news broke of a settlement in the strike between Verizon and workers represented by the Communications Workers of America and the International Brotherhood of Electrical Workers. Workers are expected to return to their jobs next week. IBEW President Lonnie R. Stephenson issued a statement saying, “This tentative contract is an important step forward in helping to end this six-week strike and keeping good Verizon jobs in America.” Verizon’s unionized workers, he said, “look forward to returning to work serving their customers, working under a strong pro-worker and pro-jobs contract.”

With the strike by unionized Verizon workers going into its seventh week, Campaign for America’s Future’s Isaiah J. Poole conducts a short interview with Sara Steffens, Secretary Treasurer of the Communications Workers of America (CWA).

“The picket lines are incredibly strong,” she says in the interview. The striking workers continue to gain support because more people recognize Verizon, as she put it, is “a corporation that doesn’t need a giveback but wants it anyway.”

This is important not just to Verizon’s workers, but for all of us. The April 14 post, “Verizon Workers Strike To Keep America’s Middle Class,” explains that the union’s fight is about a lot more than just their pay, work location and hours.

This is really about the bigger fight between the corporate-dominated economy that puts workers (all of us except a few) last, entirely looking at what benefits the corporation. Work hours, pay, stability, benefits, all are sacrificed to further corporate “flexibility.” So it you are not a wealthy executive or shareholder your life just gets harder and harder, and you have fewer and fewer rights and options.

Another Verizon Strike National Day of Action is being planned for June 2. By then,

… the working families on strike at Verizon and Verizon Wireless will have gone 51 days without pay and over a month without health insurance.

Let’s show Verizon what this fight is all about – making sure the needs of working families are met and protecting good, union jobs for generations to come for all working people in this country.

Join us for a National Day of Action on June 2. Please RSVP and save the date. We’ll be back in touch about events near you and how you can support the fight online.

This post originally appeared on ourfuture.org on May 27, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.


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New Study Reveals Just How Brutal Meat and Poultry Work Is for Workers

Posted on by Elizabeth Grossman
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elizabeth grossmanThe meat and poultry industry remains exceptionally dangerous, despite a decline in reported injuries and illnesses over the past 10 years, according to a new Government Accountability Office (GAO) report. Further, says the report, the injury and illness rates reflected in Department of Labor numbers are significantly underreported. As a result, these figures do not fully represent what is actually happening within this industry that employs about 526,000—including many recent immigrants and noncitizens. The report also found evidence of workers being denied proper medical treatment on the job and that they often fail to report injuries for fear it will cost them their jobs.

Released Wednesday by Senator Patty Murray (D-WA), Senator Bob Casey (D-PA) and Congressman Bobby Scott (D-VA), the report notes that working conditions in the industry have not improved substantially since the GAO examined the industry in 2005. Workers in poultry and meat processing plants, says the report, “continue to face the hazardous conditions the GAO cited in 2005, including tasks associated with musculoskeletal disorders, exposure to chemicals and pathogens and traumatic injuries from machines and tools.”

“Today’s report makes clear that workers still face hazardous conditions that put their health and safety in jeopardy,” said Senator Murray on a call with reporters. “In our country every worker should be able to earn a living with dignity and without worrying that their work will make them sick or injured,” she said.

“The pain never really went away. It just went up my arms and elbows,” said former Nebraska meatpacking work Jose Gaytan on the call. “The work speeds of the plant were so fast that my hands would swell up and lock up,” he said. Gaytan described how the plant processed 1500 to 1800 head of cattle a day, so that each worker processed 250 to 300 “loins” per day—each about 80 pounds of “frozen cow meat and bones” —or almost one per minute. There were “falls slips, burns and cuts and crippling injuries to co-workers,” said Gayton. “I saw two different saw operators cut off fingers because the line was coming too fast,” he said.

Line speed is a huge problem in these plants where poultry workers typically handle 30 or more turkeys and 100 or more chickens a minute.

Omar Hassan, who worked at a Jennie-O turkey plant in Minnesota for over two-and-a-half years described how when he came back to work after a finger and shoulder industry with a doctor’s note saying he could not do the same level of work as before, the company refused to accommodate him. “I tried talking them into placing me on light duty,” he said. But the company refused, “and they fired me after that,” said Hassan, speaking on the call through an interpreter who translated from Somali.

Also contributing to the injury undercount, says the GAO, is that injuries and illnesses suffered by workers hired through labor contractors may not be properly accounted for. Contributing to these problems is the industry’s high turnover rate—“often 100 percent or more annually,” said Southern Poverty Law Center staff attorney Sarah Rich.

Poultry and meat plant workers often include “refugees, undocumented immigrants and prisoners,” said Rich. These workers, she said are “often fired and treated as disposable by these companies.” And all this contributes to “a climate of fear that prevents workers from speaking out,” she said.

Musculoskeletal disorders rampant in meat and poultry processing but underreported

The GAO also reports that injuries included in official records cover only those for which workers took time off. This means they fail to account for many of the musculoskeletal disorders that are widespread throughout the industry.

According to the Occupational Safety and Health Administration (OSHA), the U.S. Bureau of Labor Statistics has found that musculoskeletal disorders account for many of the injuries that create a serious injury rate for the meat and poultry processing industry that is more than 3 times higher than other U.S. industries. In a 2015 report, the National Institute of Occupational Safety and Health (NIOSH) found 81 percent of the poultry plant jobs it evaluated exceeded recommended limits for hand activity and that 34 percent of employees had symptoms qualifying as carpel tunnel syndrome.

“We should have no confidence about industry’s assertions about their injury rates,” says Celeste Monforton, professorial lecturer in occupational and environmental health at George Washington University’s Milken Institute School of Public Health. She describes a NIOSH investigation finding that a Maryland poultry plant logbooks showed only four cases of carpel tunnel syndrome over four years while NIOSH found 18 workers with those injuries at the same plant.

She also described an OSHA Alabama poultry plant investigation that found a worker who was seen 94 times by a company nurse before being referred to a physician for treatment. “The industry games the system,” says Monforton, explaining that first aid is not recorded in company logs.

Well-documented history of high hazard

“The GAO report reinforces and validates reports released by independent groups for over ten years,” says Rich, listing reports by the Southern Poverty Law Center, Oxfam America, by Alabama Appleseed, Northwest Arkansas Workers Justice Centerand others as well as investigations by NIOSH and OSHA.

“We uncovered many of the same issues the GAO has now confirmed. Workers have told us about the same conditions that the GAO detailed in their report today,” Oxfam America senior advocacy advisor Oliver Gottfried told reporters. In addition to denial of medical care, fear of retaliation, and lack of reporting on industry logs, Oxfam America has recently reported on how poultry plant workers’ are denied adequate bathroom bathroom breaks.

Speaking in Hmong, through an interpreter, a Tyson foods poultry plant worker called May, explained that the company only allows her to use the bathroom twice per night. “That is not enough for people,” says May, who works cutting meat. She also described how people who work close to meat get chemicals sprayed on their hands and face.

In stark contrast to the report’s details, the meat industry seized on the GAO report’s note of the decline in reported injury rates—from 9.8 cases per 100 workers in 2004 to 5.7 cases per 100 workers in 2013.

The report, “highlights the greatly improved worker safety record of the meat and poultry industry over the last 10 years,” said the North American Meat Institute (NAMI) in a statement. “There is always room for improvement and we will look closely at the GAO recommendations to see how they can best be implemented in the industry,” said NAMI president and CEO Barry Carpenter.

“We are pleased to see the report emphasizes the fact that injuries and illnesses have decreased dramatically in the poultry processing industry over the past several years,” said the National Chicken Council in its statement. “Perhaps more than any other industry, the poultry industry has focused its energies on the prevention of workplace injuries and illnesses, especially musculoskeletal disorders (MSDs) like carpal tunnel syndrome,” said the council.

So what happens next? 

Sen. Murray voiced support for OSHA’s new rule that will provide workers with more protection from retaliation against injury reporting and improve OSHA’s access such records. “In our country every worker should be able to earn a living with dignity and without worrying that their work will make them sick or injured,” said Murray.

“We’re taking it to the public,” Berkowitz tells In These Times. “Consumers have a tremendous influence on this industry,” she says. “We are hoping consumers are starting to take a look … at the inhumane conditions of workers and that industry has to respond by lifting standards.”

And Gottfied says reporting on industry conditions is already prompting workers to seek help in speaking out about workplace health and safety.

This blog was originally posted on inthesetimes.org on May 27, 2016. Reprinted with permission.

Elizabeth Grossman is the author of Chasing Molecules: Poisonous Products, Human Health, and the Promise of Green Chemistry, High Tech Trash: Digital Devices, Hidden Toxics, and Human Health, and other books. Her work has appeared in a variety of publications including Scientific American, Yale e360, Environmental Health Perspectives, Mother Jones,Ensia, Time, Civil Eats, The Guardian, The Washington Post, Salon and The Nation.


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Washington, D.C., Teachers Union Wrestles with the Legacy of Michelle Rhee

Posted on by Bruce Vail
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Bruce Vail

It’s been five years since self-styled education reformer Michelle Rhee left her job as head of the District of Columbia Public Schools under a cloud of bitterness and controversy, but she is still throwing shade over the Washington city school system.

Rhee’s open hostility to unions was a hallmark of her tenure in D.C. and of her subsequent career as an executive of the education reform group StudentsFirst. That hostility continues to darken relations between city officials and the teachers union, labor advocates say.

That was clear earlier this month when some of the teachers took to the streets to protest current schools Chancellor Kaya Henderson for her years-long stalling on negotiations for a new union contract. Henderson, a Rhee protégé who took over when Rhee departed in 2010, won’t come settle a new contract, says Washington Teachers Union President Liz Davis, and is adding insult to injury by meddling in the internal affairs of the union.

“[Rhee] is still here, but in the form of Kaya Henderson,” Davis tells In These Times. Rhee’s schemes for re-vamping Washington public schools have largely failed, she says, but Henderson insists on continuing Rhee-like attacks on teachers as a way to scapegoat the failure of administrators to make better progress. Most recently, Henderson delayed further negotiations on contract talks on the pretext that an internal Washington Teachers Union election is taking place, which Davis says is a clearly improper attempt to influence the vote.

“It’s Rheeism without Rhee,” remarks Leo Casey, executive director of the Albert Shanker Institute, a pro-union education research group funded by the American Federation of Teachers. (The WTU is an affiliate of the AFT.) Evidence that Rheeism has actually succeeded in improving D.C. public schools is hard to come by, Casey adds, and the city continues to rate poorlyin many national rankings.

One of Rhee’s most visible initiatives is at the heart of the current inability to reach a new contract, according to Davis. A teacher evaluation system called IMPACT rates teachers and provides generous financial bonuses for those teachers who make high scores. Low scores, on the other hand, can be the basis for dismissal. The WTU is fighting for changes to the contract’s grievance procedures, Davis says, so that members can fight unfair evaluations. Negotiations are currently deadlocked on this issue.

Disagreement over annual salary increases is the second roadblock to a new contract, according to Davis. Henderson’s most recent offer was a paltry 1 percent.

Henderson Press Secretary Michelle Lerner tells In These Times that school “policy is not to comment on contract negotiations.” The old contract expired in 2012, but remains in place to cover about 3,500 unionized teachers, she says. A mediator has been brought in for negotiations to assist talks, she says.

Pay for D.C. teachers is very good, Lerner insists, with a starting salary of $51,259 a year that is the highest in the country (though cost of living in the city is also very high). Furthermore, the IMPACT bonus system allows veteran teachers to earn six-figure incomes. Despite the lack of a new contract with across-the-board wage increases, many teachers have seen rising incomes because of the bonuses, Lerner says.

Still, D.C. has a terrible time retaining teachers, Davis says. She estimates that there has been about 70 percent turnover since 2007, and “we are still recruiting 300 to 600 new teachers every year.” Many teachers feel there is a lack of support from senior administrators, she continues, leading to wide dissatisfaction and demoralization that fuels the high turnover rate.

Driving out older teachers is one of the unspoken goals of Rheeism, Shanker Institute’s Casey suggests, so union critics might argue that Rhee/Henderson have succeeded in that respect. Likewise, charter schools have exploded in D.C. over the last ten years. Nearly half of all public school students in the city are now enrolled in charter schools, while more than 40 public schools have been closed, Davis confirms.

Relations between the union and Henderson seem likely to remain fraught with difficulty, even if a new contract can be reached soon, Casey concludes. City school administrators have established a pattern of pushing charter schools, and Henderson has privately complained that Davis is less cooperative that previous union leaders.

“[Henderson] has difficulty with Liz because she is independent,” he says.

This post originally appeared at InTheseTimes.org on May 25, 2016. Reprinted with permission.

Bruce Vail is a Baltimore-based freelance writer with decades of experience covering labor and business stories for newspapers, magazines and new media. He was a reporter for Bloomberg BNA’s Daily Labor Report, covering collective bargaining issues in a wide range of industries, and a maritime industry reporter and editor for the Journal of Commerce, serving both in the newspaper’s New York City headquarters and in the Washington, D.C. bureau.


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The New Agenda For Taking On Wall Street

Posted on by Isaiah J. Poole
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poole-60x60More than 20 progressive organizations representing millions of voters are putting their weight behind a five-point agenda for the next stage of Wall Street reform. What these groups will formally announce Tuesday, in an event featuring Massachusetts Sen. Elizabeth Warren, sets a high but practical standard for what a candidate would have to embrace to be considered a progressive on reining in the financial sector.

The Take On Wall Street campaign says it intends to ensure that the voices of working people and consumers are heard above the power and influence of Wall Street. The Washington Post reports that Take On Wall Street will combine the efforts of “some of the Democratic parties biggest traditional backers, from the American Federation of Teachers and the AFL-CIO to the Communications Workers of America.”

The campaign is pressing five changes that the coalition says would lead to a fair financial system that works for Main Street and working families, not just Wall Street billionaires. Most are embodied in legislation that is currently pending in Congress:

? Close the carried interest loophole. That’s the tax code provision that allows hedge fund and private equity managers to pay a lower tax rate on their earnings than what ordinary workers pay on what they earn. The Carried Interest Fairness Act (H.R. 2889) would end this inequity.

? End the CEO bonus loophole. That loophole allows corporations to write off a large share of CEO pay as a tax deduction – by calling it “performance-based” pay. The result is that taxpayers are subsidizing CEO pay to the tune of $5 billion a year. That amount of money would cover Head Start for more than 590,000 children, or pay the health care costs of more than 480,000 military veterans, or fund full scholarships for more than 600,000 college students. The Stop Subsidizing Multimillion Dollar Corporate Bonuses Act (H.R.2103) would end taxpayers subsidizing CEOs and allow those dollars to be used for such priorities as education and health care.

? End “too big to fail.” Both Democratic presidential candidates, Hillary Clinton and Bernie Sanders, say they agree with the principle that banks that are “too big to fail are too big to exist,” but Clinton is adamantly opposed to the one thing many economists and banking experts believe would help avert the need to bail out a “too big to fail” bank: a legal wall separating consumer banking from high-risk investment and trading activity. The Return to Prudent Banking Act of 2015 (H.R.381) and 21st Century Glass-Steagall Act (H.R. 3054) would bring back a version of the Glass-Steagall Act, which was repealed in the 1990s under President Bill Clinton.

? Enact a Wall Street speculation tax. It’s not right that consumers pay a sales tax on most things they buy, but traders don’t pay a sales tax on the stocks they buy. A tiny tax on the sale of Wall Street financial products – like the one envisioned in the Inclusive Prosperity Act of 2015 (H.R.1464) would raise billions of dollars for critical public needs, and could serve as a brake on high-speed computerized speculation that risks destabilizing markets. This tax would go farther than a narrowly targeted tax that Clinton has proposed.

? End predatory lending and offer alternatives for the “unbanked.” The coalition is throwing its support behind efforts by the Consumer Financial Protection Bureau to enact tough new regulations against payday and title lenders, which frequently entrap low-income borrowers in a quicksand of debt through sky-high, often three-digit interest rates and exorbitant fees. It also champions such “public option” alternatives as allowing the U.S. Postal Service to offer basic banking services.

All of these ideas have been proffered by progressive financial reformers even as the Dodd-Frank financial reform law squeaked through Congress in 2010. But this promises to be the broadest effort yet to combine these proposals into a singular reform push, and it comes as jockeying begins to shape the Democratic Party platform. As The Post notes, “Unlike previous anti-Wall Street campaigns such as Occupy Wall Street this group hopes to organize a campaign that will span state houses and as well as the halls of Congress, potentially forecasting a big fight on financial reform in 2017.”

It also comes as many in the Wall Street financial community turn to Clinton as the sane alternative to Republican presidential nominee Donald Trump in the general election campaign. These money interests will want Clinton to assure them that her get-tough rhetoric is nothing more than political red meat to assuage an angry populist electorate; their hope is that if the pivot to a centrist posture doesn’t happen in the general election, it will surely happen once she secures the presidency. But broad support for the Take On Wall Street agenda will limit Clinton’s ability to pivot, especially if this agenda helps elect new Senate and House members committed to not allowing Wall Street to keep rigging the economy against the rest of us.

This blog originally appeared at ourfuture.org on May 23, 2016, Reprinted with permission.

Isaiah Poole Worked at Campaign for America’s Future, attended Pennsylvania State University, and lives in Washington, DC.

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Does Moving Jobs Out Of The Country Affect What People Here Get Paid?

Posted on by Dave Johnson
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Dave JohnsonEconomists are still arguing over whether moving our jobs out of the country affects what the people still here get paid. Yes, really.

For example, Jared Bernstein in The Washington Post looks at different studies of the effect of moving jobs out of the country. One study, by economists David Autor, David Dorn and Gordon Hanson (referred to by Bernstein as “ADH”), was published in January by the National Bureau of Economic Research. The other, by economist Josh Bivens at the Economic Policy Institute, was published in 2013. Both found that moving jobs out of the country hurt the wages of not just the affected workers but everyone in the surrounding area. The question is, does this wage-depressing effect spread outside the local area?

Bernstein writes, “The analytic question is twofold. First, are American workers really hurt by trade competition, and second, if so, are there spillovers to those not directly in competition with imports?”

To understand the difference … in Bivens vs. ADH, consider two towns, one with two businesses, a factory and restaurant, and the other with just a restaurant. In ADH’s findings, the negative spillover, or diffusion, stays mostly in the first town. The factory takes a competitive hit from cheaper Chinese imports. This, of course, directly hurts the blue-collar factory workers, but it also hurts the restaurant workers, both through demand (fewer factory workers showing up for lunch) and supply (more competition for jobs at the restaurant) effects.

In Bivens’s model, and this is the way most economists think about this (which doesn’t, by a long shot, make it correct), the ADH story holds in town one, but town two also gets hit, even though there’s no factory there facing increased global competition. Displaced workers from town one can’t find enough work there so they head for town two, and the added supply effect puts downward pressure among town two’s restaurant staff members.

It comes down to this. Do laid-off workers stay where they are (ADH), which means the wage-depression stays local? Or do they move elsewhere and compete with people who still have jobs (Bivens), thereby depressing wages there as well?

There’s a simple way to test this. Detroit and Flint are just two examples of cities hit by factories that were closed so employers could pay less in other countries but bring the same goods back here to sell in the same stores (so executives and Wall Street shareholders can pocket the differential for themselves).

So did the laid off workers stay put (ADH) or move (Bivens)? Detroit’s population was 1.85 million in 1950. That fell to 713,777 in the 2010 census. Flint’s population was 196,940 in 1960 and fell to 99,763 in 2013.

They moved. The “effect” did not stay in Detroit and Flint. So everyone else’s wages took a hit, too. Multiply what happened in these two cities nationally and you get the picture. If you don’t get the picture, here is the picture:

OK, it isn’t all that simple. ADH do look at “commute zones,” and there are other factors depressing wages. They cite technology, along with the “decline of unions, eroding minimum wages, the rise of nonproductive finance, and especially the persistent absence of full employment labor markets” as factors reducing worker bargaining power and fostering wage stagnation. Whatever. Bernstein writes the following, which is important especially as we head into an election where Donald Trump is using the costs of trade as a main issue:

Still, the main message from ADH, Bivens, and the rest of us who’ve been trying to raise this cost side of the equation for decades is that these costs are real. They’re acute for many people and places and diffuse to some degree for others. Economic platitudes about how trade is always worthwhile as long as the winners can compensate the losers are an insult in the age of inequality, where the winners increasingly use their political power to claim ever more winnings.

Most of us feel the costs of moving so many jobs out of the country (and calling it “trade”) while a few are making a killing from it. Those few are using their political power to keep the rigged game going.

P.S.: It is important to point out that once again the idea of “trade” in elite discussion is entirely about moving American jobs to places where people are paid less and the environment is not protected, in order to reduce “costs.” They don’t actually mean “trade” as in “they sell us bananas and use the money to buy cars” – because who cares?

This post originally appeared on ourfuture.org on May 12, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.


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More Evidence on Why Inequality Matters

Posted on by William Spriggs
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William SpriggsThe evidence has mounted, and is clearly accepted, that extreme income inequality has grown in the United States over the past 40 years—and by extreme income inequality, I mean a huge imbalance in income growth favoring the top 1% of the population. This is extreme because it is large enough and sufficiently imbalanced growth that it must force a rethinking of economic policies.

Too much of the debate has been taken up on wage disparities between high-tech workers and low-wage service workers, between those who program the robots and those displaced by them. All those debates are limited to understanding the stagnant income growth within those in the bottom 90% of the income distribution. In net terms, those workers have gained nothing.

Unfortunately, however, that framework continues to dominate the global consensus debating solutions to the rising inequality, whether it is from the International Monetary Fund or the Organization for Economic Cooperation and Development, pillars of the so-called troika of policy centers that define neoliberal consensus on best practices for national policy. And, the concerns about inequality echo through the World Bank and the World Economic Forum.

Recent research is pointing to a new direction of understanding why inequality hurts growth. It is based on micro-economic evidence of firm-level success and points to why policies aimed at reversing income inequality are in the interests of businesses at the firm level. By exploiting new big data, economists are modelling a different challenge that inequality creates.

Last year, Simon Gilchrist and Egon Zakrajšek looked at differences in pricing behavior of firms during the recovery from the 2008 recession and uncovered that firms live and die based on their customer base. Growth of the firm is reliant on growth of their customer base. Firms that face stagnant customer base growth and loss of customer base then live or die on the availability of credit and their liquidity. Those firms are fragile. A downturn like 2008 means they face the strongest headwinds, their customer base freezes or shrinks as their incomes fall and their lack of credit from the financial collapse can easily mean they fail, or struggle to hold on by raising prices to their remaining customers.

The macro-economic implications are clear. If the bottom 90% of the income distribution rises by only 0.7%, then there will be a lot of firms facing no growth in their customer base. Another new study this week confirms that. Xavier Jaravel shows that those with low incomes consistently buy the same products year to year. This follows basic economic rationality. Consumers with the same income, assuming fixed tastes and preferences, should be observed buying the same things over time. Having revealed their preferences for goods, if their incomes don’t change, their preferences should also be stable over time. In business terms, they do not present themselves as new customers. So, firms do not chase them. These same consumers, therefore, do not realize any gains from “competitive” markets, fighting through prices to win dominance over new products. Instead, the firms that serve the poor are the firms Gilchrest and Zakrejšek point out must survive on raising prices to hold onto their total revenue during tough times.

The rich, Jaravel found, on the other hand, face great competition for them among firms chasing expanding customer bases. In short, the rich are not poor people with more money. They do have different tastes; as economic theory suggests, rising incomes change people’s tastes and preferences. Economists, in fact, label some goods as inferior goods because as incomes rise, demand for them falls; the rich buy foie gras, not baloney, craft beers, not Bud Light. When firms chase those customers, they compete, and the benefit is falling prices for those goods.

So, there are two distortions that hurt growth when income grows so unequally. First, if income grows equally, then the 127 million American consumer units (households and families that buy things) all become potential new customers. Firms would then chase them, and the competitive dynamics of the market would create new opportunities to grow or create businesses. But, when only 1% have rising incomes, that is a growth of 1.2 million potential new customers. That is a vastly smaller set of opportunities for firms to grow.

Second, it is a limited set of tastes and preferences to go after; it is a market that lacks the scale for creating large numbers of jobs and production efficiencies that come from a mass market of 127 million new customers. This hurts productivity growth, as more jobs are created and aimed at smaller scale production.

So, rather than ask individual firms, “What would a $15-an-hour wage mean in paying their workers?” firms should be asked, “What would a 100-fold increase in their customer base mean?” Most firms are more concerned about the latter, without an understanding of ways to make that happen. But, if the economy is to grow, be dynamic and benefit workers and companies both, companies need to think about what policies make growth more equal.

This blog originally appeared in aflcio.org on May 20, 2016.  Reprinted with permission.

William E. Spriggs is the Chief Economist for AFL-CIO. His is also a Professor at Howard University. Follow Spriggs on Twitter: @WSpriggs.

 


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The Verizon Strike Is Not Just About Wages. It Is About Power and Domination Over Workers.

Posted on by Alex Gourevitch
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Gourevitch, AlexanderThis piece first appeared at Jacobin.

Bruce* has worked construction for Verizon for nearly thirty years and he is on strike. Walking a picket outside a Verizon Wireless store, he explains why: “I love this job. It’s outdoors, you get dirty, you get to do things. You see that island over there, I can tell you where each of the manholes are. I’ve been in every one of these buildings here,” he says, pointing to a café, then some office buildings, a travel agency, and a few restaurants. “I don’t like not working, just standing around here. But we gotta do this. I mean, I love this job but I don’t want it for my children.”

Only a few Verizon workers are picketing this Massachusetts location, standing calmly in the signature red shirts of the Communications Workers of America (CWA) holding placards emblazoned “On Strike!”

Their orderly protest stands in contrast to other East Coast Verizon picket lines. In Maryland a Verizon attorney struck a worker with his Porsche. In Westborough, Massachusetts a scab driving drunk hit a picketer, hospitalizing him. Verizon has suspended the health care of all strikers, so that hospital stay was not covered by his normal insurance.

Then there was the altercation outside the City View Inn, on the border between Queens and Brooklyn in New York City. Verizon has been using various hotels as makeshift office-garages, directly dispatching scabs to work sites from their temporary housing.

In response, picketers have been arriving at these hotels at three, four, or five o’clock in the morning, ringing bells, blowing horns and singing loud chants. The strikers have caused such disruption that some hotels refuse to house the scabs any longer.

Verizon has begun to successfully restrict this activity through court injunctions. It has also been getting help from the NYPD. At City View the NYPD once used police vans and contractor trucks to drive scabs to work.

By law police are supposed to remain neutral, which should mean not driving scabs through a picket line. Picketers got upset and a policeman driving one truck panicked, driving the vehicle into one of the striking workers before racing off.

These incidents have special meaning to Verizon workers. The CWA wears red to commemorate Gerry Horgan, who died during the 1989 strike when a Verizon manager drove into the picket line.

Meanwhile, Verizon customers suffer incompetent work by poorly trained replacement managers and scabs. Problems range from the mundane, and sometimes comic—damaged telephone poles duct-taped together, botched wiring procedures, failed phone and FiOS fixes—to the more serious: in Middletown, Pennsylvania, scabs dumped large amounts of polluted water into a roadside ravine, for which Verizon will likely be fined.

Walking the picket with Bruce, I asked him why he wouldn’t want his children working this job. He responded,

Look, if Verizon has its way, it will break the union and turn this into a twenty-dollar-per-hour job with no retirement and little or no health care . . . We’re not asking for some huge raise here we just don’t want to keep giving everything away. They want to reduce our retirement, raise our health care costs, or make this job so miserable that the well-paid people leave. We just want to keep our decent jobs but I don’t know if we’ll be able to. We are trying to stop the bleeding but I don’t know if this job has a future for my children in twenty years. I don’t know if they can live in a decent way.

That workers are simply trying to keep what they already have is a point rarely highlighted in the mainstream strike coverage. In fact, the relatively decent living standards of these unionized employees is what makes this strike so important.

The CWA is one of the few private-sector unions that has been able to win and defend reasonable wages and benefits. In an economy where real incomes for most people have remained stagnant or declined and where the top 1 percent have enjoyed around 90 percent of the Obama recovery’s gains this is significant feat. An effective union like the CWA is one of the few centers stoking resistance to increasing inequality.

The 39,000 Verizon strikers have already shown that they’re not just defending their own interests. One of their main demands has been to protect the jobs of call-center workers, who are not members of the union, and whose livelihoods are threatened by Verizon’s plan to send five thousand jobs offshore.

The CWA even sent representatives to the Philippines, to support call center workers who decided to protest in support of US strikers.

As Fortune reported, they were met with violence from private Verizon security forces and then a “SWAT team of heavily armed Philippine police officers.” This episode highlighted how the strike is challenging a major player in the global production of oppression and economic injustice.

Javier, a technician from New York who now works as a shop steward, says the problem isn’t just about work rules and contract givebacks. It’s about how the Verizon business model is designed to generate massive inequality:

It’s not fair that a CEO can make $18 million [in] salary and the average worker caps out at $86K for field techs. And take federal, state, city out of that, plus what we pay for medical and 401ks.

At Verizon, the CEO to employee pay ratio is 208:1. This isn’t far from the average CEO to employee pay ratio in the United States: 300:1, an increase of more than 1,000 percent in inflation-adjusted terms since 1978.

Yet Verizon’s top management is unsatisfied. It wants more concessions on benefits, more control over its employees, and an even more intensely exploited workforce.

That’s nothing new these days. More unusual, though, is that workers are fighting back. Their fight to keep their benefits has become inseparable from a struggle for power.

Though this is a society that prides itself on its “economic freedom,” the Verizon strike brings to the fore all the indignities, injustices, and outright oppression that saturate the American workplace.

YEARS IN THE MAKING

The strike has been brewing since last August, when the CWA’s contract with Verizon expired. Despite a $5.4 billion profit that quarter and roughly $39 billion in the past three years, Verizon refused a new contract on existing terms.

Instead it demanded concessions like higher health care costs, reduced retirement benefits, outsourcing five thousand jobs, and a right to send workers out of state.

The company’s August refusal is part of a decades-long attempt to strip down contracts and weaken the union, perhaps with the hope of breaking the union altogether and then selling off the landline portion of Verizon’s business.

“The first shot to break the union was in the post–2000 contract,” says Javier. That contract created a two-tier system in which new hires were denied protection from layoffs.

In the years since, the company has managed to win further changes in contract language, gaining more control over workers with respect to schedules, work locations, and hiring and firing.

For instance, the new contract stipulates that workers from Buffalo can be called away from their families to work in Boston. Or, in the contract that expired in August, Verizon has the right to force workers to take some other day than Saturday as an “N-day,” or non-assigned day.

And, to make matters worse, that contract says that Verizon can require up to ten hours a week of overtime in non-summer months, and fifteen hours a week in summer months. This means that Verizon can make Tuesday, rather than Saturday, the N-day, and then force a technician to work a ten-hour overtime shift that day.

“So now they have me in six days a week,” says Javier. “If I had tried to schedule a doctor appointment on Tuesday, my N-day, I have to cancel it [or] they can take disciplinary action. If you miss enough overtime assignments then they can suspend you.”

“The company claims it needs to be able to do all this for workplace flexibility, but it’s just a play by the company to make it difficult for the workers so they leave,” says Javier. That strategy has worked; five thousand union workers have left Verizon since the last time the CWA called a strike in 2011.

Verizon’s new demand is to be able to send workers out of state, away from their families, for up to two months at a time. For instance, Verizon has recently announced a plan to build FiOS in Boston.

Normally, it would have to hire Boston-area technicians, but with Verizon’s new plan they could send technicians from Virginia or New Jersey to Boston, under pain of suspension or firing, to do the engineering, construction, and wiring.

As the out-of-state work issue illustrates, this strike isn’t just about wages and benefits, it is about power and domination. Verizon wants workers that move around like frictionless little atoms, ready to mold themselves to the needs of the company.

Verizon workers, however, insist they are human beings. Resisting schedule manipulation is just the start.

MANAGERS FROM OUTSIDE

Workers are also fighting something Verizon calls theQuality Assurance Program (QAR). The company says it was introduced to keep better time records. But its greater use lies in helping bosses micromanage workers’ time.

Gavin*, who has worked installation and maintenance for more than sixteen years, has experienced the worst effects of QAR.

Recently, after finishing an eight-hour shift, he was commended by a manager for his conscientious work. Yet the very next day he was called in for one of these QAR disciplinary proceedings. Subjected to a barrage of questions, without even knowing what the infraction was, he was then suspended for six weeks without pay.

The infraction turned out to be an error on management’s side. The union fought for Gavin and he was eventually reinstated, though he still lost a week’s pay and retained a mark on his record. Gavin emailed me about his experience:

My union reps fought for me and I was given back everything, but one week of pay, and a sullied record at Verizon . . . When they were asked to produce the proof there was none to be produced, yet I was standing with texts, phone records, and customer testimony as my defense to no avail. Do we operate in a democratic society, or is Verizon and its current regime of rulers somehow an exception to what this country stands for?

Based on my discussions with other Verizon workers, Gavin’s experience is typical. Arbitrary procedures, rulings, and minute control over work are standard fare at Verizon.

For instance, Gavin is allowed a half-hour lunch break, including time traveled from and back to the work site. Anything more can result in serious discipline; a thirty-five-minute lunch can cost a worker six weeks of pay.

“According to Verizon, we are not allowed to take a bathroom break without management approval,” says Javier. “That is an outright disgrace to human dignity.” His manager even demands that workers call him if they wanted to pee:

Unfortunately, when we call him, it goes to voicemail then we can’t leave a message because his box is full. We complained, so now he lets us text him. But a text is not complete, according to him, until he responds. So what am I supposed to wait? . . . If there is no management approval, then if I go then I’m “off the job.” That is a loophole they exploit to suspend us.

In Javier’s view, which I heard many Verizon workers repeat, lower-level managers appear to be under pressure to suspend a certain number of workers or run a given amount of disciplinary proceedings. “The QAR is directly targeted at the lowest 6 percent of the productive technicians,” says Javier, “and we all know there will always be a bottom 6 percent.”

On top of that, the composition of lower-level management has changed. “In the past managers were folks who actually came from the field, and therefore understood what they were managing and could more efficiently address any actual on-the-job concerns,” says Gavin. Now, most lower-level managers are not former engineers or technicians but individuals hired to implement this new disciplinary regime.

“Some of these new managers come straight out of the military, from a tour of service,” says Bruce, shaking his head. “And they’re afraid for their jobs.” Many of these lower-level managers are being forced, under threat of being fired, to scab.

The change in managerial culture, the creation of new disciplinary proceedings, the intensification of work rules, and the increasing enforcement of minor infractions is a regular feature of contemporary American labor relations.

As labor reporter Steven Greenhouse has described, American companies large and small have turned lower-level management into discipline machines, “setting ever-tougher goals for its managers, using sophisticated computer systems to monitor their every move, ousting those who fall short of expectations, allowing managers to use foul language and savage criticism to bully subordinates.”

They are often given impossible quotas or benchmarks, which can be achieved only by making inhuman demands on workers, doing unpaid work themselves, or outright wage theft/time-stealing.

Managers unwilling to do any of those things just get fired and replaced with those mean or desperate enough to do it. Verizon fits right into this pattern, except that its workers have a union with the collective power to push back, as it did in Gavin’s case.

“I think the company has one end in mind to all of this . . . to break the union,” says Javier. “And if they couldn’t break the union per se and have to offer a contract, even if they do it to get smaller and smaller contracts and try to push people out of the company. If they make the conditions so deplorable people will leave.”

Every Verizon worker I talked to agreed, including many who were worried enough that they were unwilling to be quoted even under a pseudonym.

LABOR AND THE LAW

The most successful tactic during this strike has been holding pickets outside hotels housing scabs. That’s why Verizon has sought injunctions against this, and other practices, and in a couple states has had its way.

On May 9, Verizon won a temporary injunction against these pickets in New York City and this injunction was then extended until June 9.

In Philadelphia, Verizon won an injunction permitting no more than six picketers and forcing them to stay at least fifteen yards from Verizon’s retail stores and authorized retailers.

These injunctions occur against the background of already extraordinarily punitive labor law. The 1935 National Labor Relations Act says that workers have a right to strike, but this has been interpreted in the narrowest possible terms, and limited by subsequent legislation.

The subsequent 1947 Taft-Hartley Act banned sympathy strikes, political strikes, and secondary strikes and boycotts, which placed huge legal obstacles to the solidaristic worker action that used to be a regular feature of American labor politics.

Judges have taken what remains of the right to strike and whittled it down even further. One important Supreme Court precedent says that workers may not be fired for going on strike, but in most cases employers are free to hire permanent replacement workers.

You can’t be fired but you can be permanently replaced. Or the employer can threaten to move the entire workplace. You can’t fire any specific individual who threatens to strike, but you can in effect fire them all.

This legal situation has led one commentator to observe, “The ‘right to strike’ upon risk of permanent job loss is a ‘right’ the nature of which is appreciated only by lawyers.” Primarily corporate attorneys and those specializing in union-busting, one suspects.

Striking workers face any number of further restraints, depending on state law and the mood of a judge—all of which puts potential or existing strikers in a bind. Either they exercise their right to strike within the bounds of the law, with little hope of winning and high likelihood of being replaced, or they confront the law itself.

In this environment, only relatively skilled workers, who are hard to replace en masse, can go on strike with some hope of stopping or slowing production. This means workers in sectors like fast food, retail, and agriculture—with the worst pay, fewest benefits, and least amount of workplace control—have the least freedom to defend their interests legally.

That is a problem for all workers who want to exercise their power collectively. It is no surprise that an AFL-CIO president once claimed he would prefer “the law of the jungle” to American labor law. And it is hard to imagine any serious revival of a robust class politics without potentially massive acts of civil disobedience.

LOOKING FORWARD

The Verizon strike is in its fifth week and whatever happens it is not just a strike about Verizon. It is about organized workers facing a punitive company, repressive labor law, and a dwindling membership trying to preserve their power and resist further attacks on their benefits, dignity, and time and personal freedom.

As Javier says, if they are successful, they can be a standard for others to rally around:

If we can set a bar for everyone else . . . then other people, who aren’t in a union, can aspire to raise themselves up to our level. Right now the company wants to push everyone down to the poverty level. If we are able to go on strike and have the right to strike then we can fight not just for ourselves but for other people. We can be something for everyone.

In an unequal, capitalist society like ours, there is no substitute for militant workers, organized on the widest possible basis, who can use the best weapon they have: the refusal to work.

It’s easy to imagine radical alternatives to the status quo. It is far more difficult to generate the social power and political muscle to make any of those visions a reality. But Verizon workers are helping show the way.

*Names have been changed.

This blog originally appear at inthesetimes.com on May 20, 2016. Reprinted with Permission

Alex Gourevitch is an assistant professor of political science at Brown University and the author of From Slavery To the Cooperative Commonwealth: Labor and Republican Liberty in the Nineteenth Century.


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Best-Case Projections For TPP Show Few Benefits, Worse Trade Deficit

Posted on by Dave Johnson
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Dave JohnsonThe U.S. International Trade Commission (ITC) has released a report predicting the effect the Trans-Pacific Partnership (TPP) will have on the U.S. economy. In the past these reports have been skewed to promote trade agreements, with numbers that turned out to be much better than what actually happened.

Even with this history of exaggerated promises of benefits from trade agreements, the ITC says that TPP won’t do all that much for our economy, and will make the trade deficit worse. The ITC report says TPP will increase the U.S. trade deficit by over $21 billion per year and will harm employment in key industries.

ITC Reports Have History Of Rosy Projections

In the past the ITC reports have made flowery promises about what will happen when we sign trade agreements. The actual results varied considerably and were much worse for the U.S. than projected.

A study released last week by Public Citizen looked at past ITC projections of what would happen if we entered into trade agreements. The study looked at the ITC’s promises about NAFTA (the North Atlantic Free Trade Agreement), China’s entry into the World Trade Organization and the Korea-U.S. agreement. It found that the ITC predictions on each pact was inaccurate, always projecting a much better outcome than actually occurred.

According to a Public Citizen news release accompanying the study:

The USITC predicted improved trade balances, gains for specific sectors and more benefits from the 1993 North American Free Trade Agreement (NAFTA) and 2007 U.S.-Korea Free Trade Agreement (FTA) in reports on those pacts. The agency projected only a small deficit increase from China’s 1999 World Trade Organization (WTO) entry deal and the granting to China of permanent normal trade relations status.

Instead, the U.S. trade deficits with the trade partners increased dramatically and, as detailed in the text of the new study, manufacturing industries from autos to steel and farm sectors such as beef that were projected to “win” saw major losses. A government program to help Americans who lose jobs to trade certified 845,000 NAFTA jobs losses alone and econometric studies concluded that millions of jobs were lost from the China deal, in contrast to gains projected by the USITC reports.

This is a summary of the results:

NAFTA: Before NAFTA, the U.S. trade had a $2.6 billion goods trade surplus (services data was not available). The ITC predicted NAFTA would create a $10.6 billion goods and services surplus. Instead in 2015 we had a $57 billion goods and services deficit.

China: Before opening WTO trade with China, we had a $113 billion trade deficit.The ITC predicted this would grow to $120 billion. Instead in 2014 we had a #340 billion trade deficit with China.

South Korea: We had a $5.8 billion deficit. ITC predicted the agreement would cut that to a $2.5 billion deficit. But instead we had a $16.8 billion deficit.

The ITC Projections For TPP

The ITC has released its TPP report: “Trans-Pacific Partnership Agreement: Likely Impact on the U.S. Economy and on Specific Industry Sectors.” It projects extremely modest gains, and these only after 15 years.

Among the projections:

Main Findings

… The model estimated that TPP would have positive effects, albeit small as a percentage of the overall size of the U.S. economy. By year 15 ([032), U.S. annual real income would be $57.3 billion (0.23 percent) higher than the baseline projections, real GDP would be $42.7 billion (0.15 percent) higher, and employment would be 0.07 percent higher (128,000 full-time equivalents). U.S. exports and U.S. imports would be $27.2 billion (1.0 percent) and $48.9 billion (1.1 percent) higher, respectively, relative to baseline projections. U.S. exports to new FTA partners would grow by $34.6 billion (18.7 percent); U.S. imports from those countries would grow by $23.4 billion (10.4 percent).

And later in the summary, get this: “… agriculture and food would see the greatest percentage gain relative to the baseline projections; output would be $10.0 billion, or 0.5 percent, higher by year 15.”

Got that? The greatest gain our country would see from TPP is one half of one percent in the agriculture and food sectors, but only after 15 years.

The ITC report estimates U.S. economic growth gains would be $42.7 billion or 0.15 percent and income gains of $57.3 billion or 0.23 percent by 2032. Public Citizen explains how modest this is: “In other words, the ITC projects that the United States would be as wealthy on January 1, 2032 with TPP as it would be on February 15, 2032 without the TPP.”

It estimates a decline in output for U.S. manufacturing/natural resources/energy of $10.8 billion as exports would increase by $15.2 billion and imports would increase by $39.2 billion by 2032. This translates to a loss of even more U.S. jobs in these key sectors.

Keep in mind that this ITC report assumes that there will be a “level playing field” on which other TPP countries will not manipulate currency, suppress labor or other things that hurt American jobs. It also assumes that the countries will buy from us (trade) instead of following national economic strategies to enhance key national strategic industries by selling to us but not buying from us. Of course, this is not what happens in the real world, other countries protect themselves as countries with key national economic interests; we do not.

These are only the economic projections from TPP. They do not take into account that most of TPP is not about the economic results from “trade”; it is about enhancing the power of corporations over governments. Even if TPP dramatically increased economic activity (which all goes to a few at the top now anyway) it would not be worth handing over our democracy and sovereignty to the billionaires behind the giant corporations.

Statements

A statement from House Ways and Means Committee Ranking Member Sander Levin (D-MI) begins:

My initial review of the ITC report only confirms my position that I cannot support TPP as negotiated.

“It is deeply troubling to read that overall U.S. manufacturing employment is expected to decline as a result of the agreement, and that the overall U.S. trade deficit is expected to worsen too, including in the auto and auto parts industry. And the ITC appears to confirm my concern that the weak automotive rules of origin in the agreement will result in lost auto parts jobs in the United States.

The AFL-CIO released a statement titled, “ITC Report Shows TPP Is Disastrous for Working Families”:

This ITC report is so damaging that any reasonable observer would have to wonder why the Administration or Congress would spend even one more day trying to turn this disastrous proposal into a reality. Even though it’s based on unrealistic assumptions, the report could not even produce a positive result for U.S. manufacturing and U.S. workers. One of many shockers is just how meager the purported benefits of the TPP are. A mere .15% of GDP growth over 15 years is laughably small—especially in comparison to what we’re being asked to give up in exchange for locking in a bonanza of rights and privileges for global corporations. Even though the report fails to account for currency manipulation, wage suppression and the negative impacts of uninspected food imports and higher drug costs, the study still projects the TPP will cost manufacturing jobs and exacerbate our trade deficit.

United Steelworkers (USW) International President Leo W. Gerard:

“This report validates that the Trans-Pacific Partnership (TPP) is not worth passing. In the past, similar reports have proven to widely underestimate the negative impact of trade agreements on American workers and the economy. This report as mandated by law indicates the TPP will produce, almost no benefits, but inflict real harm on so many workers.

“Because of this history, average Americans know that economic projections based on rosy scenarios always end up the same. They pay the price with lost jobs, stagnating or declining wages and rising income inequality as Wall Street profits.

“As the report was being finalized for publication, TPP proponents were touting other biased and optimistic studies in an attempt to blunt the impact of this official study. It is time that we jettison theory and deal with reality: Our nation’s trade policies are in dramatic need of reform.

… “The ITC should be commended for its thorough evaluation of the proposed TPP and the open process that it pursued. It is clear that they listened to the array of voices that asked to be heard.

“But in the end, this may be the most damning government report ever submitted for a trade agreement. It is clear that the TPP will be DOA if Congress ever decides to bring it up.”

Statement from Michael Stumo, CEO of the Coalition for a Prosperous America:

The report found that US trade performance will worsen under the TPP overall and for the majority of sectors analyzed, including services.

The Commission’s report should be viewed as the most optimistic result possible from the TPP if everything goes right. It is worth remembering that the economic projections in the Commission’s prior reports on Permanent Normalized Trade Relations status with China and the Korea-US Free Trade Agreement were vastly more optimistic than the actual results.

Statement from Richard Fiesta, Executive Director of the Alliance for Retired Americans:

“Most troubling to older Americans, the report fails to take into account the high drug costs that are expected to result from the TPP. Prescription drug costs are increasing much faster than inflation, and the TPP will only make the situation worse. The TPP agreement would enable drug companies to fight the cost-control measures already used by Medicare and Medicaid and may prevent Congress from enacting additional cost-control measures in the future.”

Sierra Club Statement:

“Today’s U.S. International Trade Commission report offers further evidence that the Trans-Pacific Partnership would be a disaster for working families, communities, and our climate. ITC reports have a record of projecting economic benefits of trade agreements that have failed to materialize, so it is noteworthy that even the overly-positive ITC acknowledges that the TPP would have real costs and estimates economic benefits that are slim.

“One of the costs of the TPP indicated by today’s report is that, by shifting U.S. manufacturing to countries with carbon-intensive production, the deal not only would cost U.S. manufacturing jobs, but also would spur increased climate-disrupting emissions.

“Today’s report is right to note the broad controversy over TPP rules that would empower major polluters to sue the U.S. government in private tribunals over climate and environmental protections. The report gives members of Congress further reason to reject the polluter-friendly TPP so that we can build a new model of trade that protects communities and the climate.”

Statement from International President Robert Martinez, Jr., of the International Association of Machinists and Aerospace Workers (IAM):

“The ITC, which historically has overestimated the benefits of trade agreements, predicts that the TPP will increase our nation’s trade deficit in manufacturing. This means that the corporate driven, secretly negotiated TPP will lead to the export of good paying manufacturing jobs to countries like Vietnam that lack basic human rights. For ordinary Americans struggling to get by this will result in more unemployment and continued downward pressure on wages and benefits.

“That a trade agreement created to boost corporate profits and CEO bonuses at the expense of working families would be so flawed is no surprise. We now have confirmation from the ITC that weak rules of origin for autos and other manufactured goods will only continue the deterioration of U.S. manufacturing. …

This post originally appeared on ourfuture.org on May 19, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.


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Thanks, Obama. Millions More Workers To Get Overtime Pay.

Posted on by Laura Clawson
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LauraClawsonIt’s been in the works for months, but on Wednesday it becomes official: The Obama administration is making millions of workers eligible for overtime pay if they work more than 40 hours a week. Currently, only workers making salaries of less than $23,660 a year—$455 a week—automatically get overtime pay when they work extra hours. Effective December 1, that number will double to $47,476, which is less than the “about $50,400” the president announced last summer, but still enough to directly cover an additional 4.2 million workers.

On a call with reporters Tuesday, Labor Secretary Tom Perez said the reform was meant to address “both underpay and overwork.”

“The overtime rule is about making sure middle-class jobs pay middle-class wages,” Perez said. “Some will see more money in their pockets … Some will get more time with their family … and everybody will receive clarity on where they stand, so that they can stand up for their rights.”

In addition to the 4.2 million workers who will automatically become eligible for overtime pay, more than eight million more are expected to get overtime because their employers will no longer be able to dodge the rules by calling them managers even though little of their work is managerial.

That includes workers like one cited in Obama’s email announcing the change:

As an assistant manager at a sandwich shop, Elizabeth sometimes worked as many as 70 hours a week, without a dime of overtime pay. So Elizabeth wrote to me to say how hard it is to build a bright future for her son.

It’s a shame the Obama administration didn’t stick with a new threshold of more than $50,000, but doubling the existing, pitifully low threshold and updating it every three years, as is included in the new rule, is a major advance for millions of workers. And as always, it’s a reminder that a Democratic president who’s prepared to use every aspect of government can do a lot, even with a Republican Congress blocking so much.

This blog originally appeared at DailyKOS.com on May 18, 2016. Reprinted with permission. 

Laura Clawson has been a Daily Kos contributing editor since December 2006. Labor editor since 2011.


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