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Inequality Is Still the Defining Issue of Our Time

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In 2011, President Obama, speaking in the wake of Occupy Wall Street, called inequality the “defining issue of our time.” Now Jason Furman, chair of the Council on Economic Advisors, argues that Obama “narrowed the inequality gap” more than any president in 50 years. The nonpartisan Congressional Budget Office echoes the observation that income inequality after taxes is no higher than it was in 2000, and that Obama’s policies have done more to reduce inequality than any other policies on record.

Don’t take down the barricades. Inequality remains extreme and continues to widen. And the populist uprisings that have roiled American politics have clear opportunities to tackle the core problem after the election.

As James Kwak at Baseline Scenario notes, the council’s report measures Obama’s reductions against what inequality would have been if George Bush’s policies had been sustained through the Great Recession. The progress comes largely from progressive tax changes. Obama raised taxes marginally on the very wealthy (allowing the Bush tax cuts to expire for very rich, particularly the 15 percent tax on capital gains, and taxing investment income under Medicare to help pay for health care reform) and increased tax subsidies to low-wage workers (expanded child tax and expanded earned-income tax credits.) These advances, while praiseworthy, don’t come close to reversing the regressive tax polices of the past decades.

As Emmanuel Saez has shown, the richest 1 percent continue to pocket the bulk of the rewards of growth. The income share of the top 1 percent before taxes fluctuates with the business cycle, but it has been rising over time. Despite recent increases, household income for the vast majority of the population has still not recovered from the Great Recession. These rewards largely reflect the underlying economic structures that determine what Jacob Hacker has dubbed predistribution (the pretax distribution of income): globalization, bargaining power of labor, executive pay structures, demand for skills, etc. As Kwak concludes, “It’s hard to point to anything [Obama] did that affected the underlying economic factors producing the increase in inequality.”

This elevates the importance of fierce political battles that will occur after the November elections. First, President Obama plans to join with the business lobby to push the Trans-Pacific Partnership Treaty through the lame-duck session of Congress. The TPP is another in the corporate trade and investment deals that have proved so devastating to American workers. Even trade-accord advocates now admit that our globalization strategy has contributed directly to growing inequality, putting American workers in competition with low-wage and repressed labor abroad, with no sensible industrial or comprehensive strategy for impacted communities and workers.

The mobilization against the TPP will engage the populist energies in both parties. Sanders’s new organization Our Revolution will join with labor and the bulk of the activist Democratic base to drive an intense opposition that will make the Tea Party look like, well, a tea party. If the TPP is defeated, the next administration will be forced to rethink America’s globalization strategies, moving toward more balanced trade, ending the special privatized investor arbitration system, and focusing attention on the tax traps and dodges that allow global corporations to evade hundreds of billions in taxes. Even if the TPP passes, the fury of the opposition could force an understanding that the old game is over.

Similarly, efforts to lift the floor under workers already in motion should gain new energy. The Republican House leadership won’t even allow a vote on hiking the minimum wage, but Fight for $15 and other movements are winning wage hikes in cities and states across the country. Measures to guarantee paid sick and vacation days and to crack down on wage theft and demand equal pay for women are beginning to move. These efforts—particularly at a time of relatively low unemployment—can help workers gain a greater share of the profits they help to produce.

Obama recently admitted that stronger unions are vital to redressing inequality. Yet he abandoned campaign promises to make labor-law reform a priority early in his administration and has refused to issue an executive order giving union employers priority in government contracting. Union support was central to Clinton’s victory in the primaries. When she takes office in January, activists should join with federal contract employees to demand issuance of a Good Jobs executive order that would encourage firms with federal contracts to respect labor rights. And Democrats at every level of executive office should be pushed to put government on the side of workers.

Finally, populist energy should be directed at curbing obscene CEO pay packages. Academics have exposed the fraudulence of “performance pay” bonuses. Investors bemoan the perverse corporate policies generated by executive efforts to drive up the value of their bonuses. Yet boardrooms haven’t got the message. It is time to turn up the heat. For example, executive compensation rules to discourage Wall Street risk-taking were supposed to have been written nearly five years ago. They haven’t been, and progressives in Congress led by Elizabeth Warren and Bernie Sanders should expose this outrage. Unions, public pension funds, and university endowments should use their votes to challenge excessive CEO compensation packages. Sanders’s Our Revolution might join with other progressive groups in challenging the worst abusers at their annual shareholders meetings.

Inequality remains a defining issue of our time. The advances made under Obama deserve applause, but the real work remains to be done. This presidential season has exposed the growing revolt against business as usual. Now activists must seize the opportunity to build on the energy after November.

This blog originally appeared in ourfuture.org on October 13, 2016. Reprinted with permission.

Robert L. Borosage is the founder and president of the Institute for America’s Future and co-director of its sister organization, the Campaign for America’s Future. The organizations were launched by 100 prominent Americans to develop the policies, message and issue campaigns to help forge an enduring majority for progressive change in America. Mr. Borosage writes widely on political, economic and national security issues. He is a Contributing Editor at The Nation magazine, and a regular blogger at The Huffington Post. His articles have appeared in The American Prospect, The Washington Post, The New York Times, and the Philadelphia Inquirer. He edits the Campaign’s Making Sense issues guides, and is co-editor of Taking Back America (with Katrina Vanden Heuvel) and The Next Agenda (with Roger Hickey).

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Black Livelihoods Matter: The Civil Justice System Needs Reform Too

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downloadThe Black Lives Matter movement has brought much-needed attention to the disparity in the way our criminal justice system treats African Americans.

But there’s another side of American justice that matters too: our civil courts.

In the United States today, the civil justice system is the last line of defense for workers who have faced discrimination on the job. And not just for individuals, either. Lawsuits and the threat of lawsuits have been the most effective way to force recalcitrant employers to take action against discrimination.

Still, our courthouses are not open to all. As a black lawyer who focuses on employment discrimination, I’ve seen first-hand how access to the courts, the racial makeup of law firms and the way cases are handled can throw up barriers to justice.

Here’s a step-by-step guide to how black workers’ cases get derailed.

Step 1: Black workers are more likely to represent themselves.

Few people can afford to pay an employment attorney up front. Instead, most lawyers in the field work on contingency—meaning they will only get paid if the worker receives a cash award. That makes these cases financially risky for lawyers, who might get nothing for hours of work if the case is dismissed. As a result, it can be hard for many workers to find an employment lawyer.

But for black workers, the problem is even worse. A study commissioned by the American Bar Association found that black plaintiffs are 2.5 times more likely than white plaintiffs to file employment discrimination claims pro se, or without a lawyer. Other racial minorities, including Hispanics and Asians, are 1.9 times more likely to file pro se than their white counterparts.

Winning an employment case is already difficult, even under the best circumstances. Pro se litigants, assuming that they can even get their cases inside a courtroom, are almost guaranteed to lose—no matter how strong the details of their case may be.

For example, litigants may be required to file their case with the Equal Employment Opportunity Commission within a certain number of days, and that time limit varies by state. Workers representing themselves may miss that deadline, and lose their cases before they even start.

Step 2: Attorneys are less likely to take cases involving black workers.

Even when black workers have found an attorney who might be interested in their case, they are less likely to get help. The ABA study found that the way employment attorneys screen their cases can contribute to the racial disparity.

In some cases, employment attorneys charge expensive consultation fees before considering a potential client. Black workers who can’t afford those fees never get in the front door. In other cases, the ABA study found that attorneys favored clients based on criteria that weren’t related to the merits of their case, such as perceived demeanor, mannerisms or a personal referral.

The disparity in pay between black and white workers adds to the problem. Because lost wages are a major part of the case, workers who make less money will receive smaller payouts. For employment attorneys who have to work for free upfront, that means less money at the back end.

Step 3: Juries aren’t always sympathetic to black workers.

Even when employment cases make it to trial, the worker still has only a 15 percent chance of winning, compared to a 50 percent win rate for other types of plaintiffs.

That means employment cases are particularly sensitive to jurors’ beliefs and prejudices. If a jury does not find the plaintiff’s story credible, or doesn’t believe that discrimination occurred, or doubts whether discrimination is all that common anyway—the worker loses.

In addition, damages for emotional distress are allowed in many employment discrimination cases. But jurors may not be as willing to provide them to black workers even when they have found in favor of them overall due to prejudices about their mythical inner strength or whether discrimination is serious.

The end result is that the same discrimination that black workers face in the workplace can also negatively affect them in the eyes of a jury.

Step 4: Even if they win, they are often awarded less money.

Workers who win their cases can receive money for emotional distress, punitive damages intended to send a message to the employer and lost wages. Under federal law, those first two amounts are limited between $50,000 and $300,000, levels set in 1991 that have not been adjusted since. (If they had been pegged to the Consumer Price Index, the cap would be closer to $525,000.)

Generally, the largest award in employment cases is for lost wages. Employees who win their cases can only get the difference between what they made since being illegally fired and what they would have made had they not been fired.

Black employees, on average, make less than white employees. As a result, black employees bringing discrimination cases are disproportionately affected by caps for damages for lost wages. This means that these employees have less leverage to negotiate an out-of-court settlement with employers prior to trial because of the low risk to the employer of having to pay a significant judgment—if the employee prevails at trial. As a result, employers may have less incentive to adequately address discrimination against black employees.

The deep-seated flaws in our civil justice system cannot be ignored. It’s a problem that needs to be addressed by employers, legal professionals, and lawmakers. There needs to be a serious examination as to why black employees who have often been unlawfully excluded from the workplace are then again denied recourse through the legal system.

This article originally appeared on the Huffington Post on October 10, 2016. Reprinted with permission. 

Phillis h. Rambsy is a partner with the Spiggle Law Firm, which has offices in Arlington, Virginia, Washington, D.C., and Nashville, Tennessee. Her legal practice focuses on workplace law where she represents employees in matters of wrongful termination and employment discrimination including racial discrimination, pregnancy discrimination, and other family-care issues such as caring for a sick child or an elderly parent. To learn more, visit www.spigglelaw.com.


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420,000 More Workers in Cook County Will Soon Have Paid Sick Leave

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ltcoyngtThe United States of America: land of liberty, bastion of opportunity, the world’s leading economic power.

But if you’re a low-wage worker and wake up sick, you’d better clock in on time or you risk losing your wages and even your job.

Paid time off for illness, taken for granted in professional sectors and much of the developed world, remains out of reach for millions of American workers. The United States is the only major developed country that does not guarantee paid sick days to all workers by law. Federal data show that more than one-third of private sector workers throughout the United States do not receive paid sick leave.

A disproportionate number of those without paid sick days are women, people of color and people with low incomes. Though women are the primary caregivers in most families, they also make up the majority of workers in low-wage jobs that do not offer paid sick days. Access is particularly bad for Hispanic workersresearchers have found that less than half get paid sick days, compared to 60 percent of workers overall. And for both women and men, federal data show that the highest paid workers overwhelmingly have access to paid sick days, while most of the poorest workers do not.

But this month, the Cook County Board of Commissioners in Illinois took a major step toward changing that. The board approved legislation that guarantees paid sick days to all workers in the county, bringing the Chicago suburbs in line with the city. Chicago passed its own paid sick leave ordinance in June.

Under the ordinance, Cook County workers will be eligible for 40 hours, or about five days, of sick time per year, the same as workers in Chicago. The Chicago Tribune reports that more than 900,000 workers in the county don’t currently have paid sick days, including 420,000 in the suburbs. The new laws in Chicago and Cook County will take effect July 1, 2017.

Melissa Josephs, director of equal opportunity policy for the advocacy group Women Employed, helped campaign for the law.

“All employees—no matter their occupation—should have the peace of mind to know they can take time off work for their own illness or to care for a sick family member without fear of losing their job or a day’s pay,” says Josephs.

Cook County workers will be eligible for 40 hours, or about five days, of sick time per year, the same as workers in Chicago. (Arise Chicago Facebook)
Cook County workers will be eligible for 40 hours, or about five days, of sick time per year, the same as workers in Chicago. (Arise Chicago Facebook)

Cook County’s decision is the most recent victory in what seems to be a growing movement for paid sick leave. Since 2006, 38 localities in the United States have passed sick leave legislation. This year alone, 12 paid sick leave laws have been passed across the country, including in Vermont and major cities like Los Angeles and San Diego.

Also this year, the momentum for paid sick leave reached the Obama administration. At the direction of the President, the Department of Labor issued new rules requiring federal contractors to provide up to 56 hours, or more than a week, of paid sick leave per year, which will impact more than a million workers when they go into effect.

Tamara Green, 29, did not have access to paid sick leave until recently. A few years ago, she was working for a major fast-food chain in New York City. She was also taking care of her mother, who is HIV positive. One day, her mother fell ill unexpectedly and Green asked her boss if she could leave. Her boss told her that if she left, she would consider it a walk-off and she would not be paid.

“How do you keep going if someone you love is ill or, God forbid, dies, and you’re not there because your boss said she needed you to drop some more fries?” asked Green. “That’s not OK.”

Paid sick leave benefits more than individual workers like Green. Research has found that giving workers the ability to stay home when they’re sick without sacrificing their wages benefits public health and the economy. Paid sick dayslead to higher rates of preventative medical care, including mammograms and Pap tests, decrease workplace injuries and reduce rates of illness.

Opponents have argued that sick leave laws burden businesses or force them to make pay cuts. But an analysis by the Institute for Women’s Policy Research found that sick leave poses minimal costs to employers. The cost of paid sick leave policies to employers in Seattle, for example, was less than one percent of revenue on average. What’s more, research indicates that the costs of paid sick leave would be at least partially offset by benefits to employers like reduced turnover, increased morale and increased productivity.

The building momentum for paid sick days suggests that local lawmakers as well as the general public are seeing these benefits. National surveys have shown that the majority of the public supports laws that would mandate paid sick leave.

But at the state and federal level, it’s an uphill battle. Between 2000 and 2013, state legislatures in 10 states—the majority of which were controlled by Republicans—passed laws that prohibit local governments from mandating paid sick days. The Healthy Families Act, which would mandate paid sick time to most workers nationwide, has been stuck in Congress for years.

At her new job, Tamara Green finally has access to paid sick days. She says knowing that she can care for herself or her mother during an emergency means she no longer has to choose “health over wealth,” and she hopes to see the day when no one in the world has to make that choice.

“To know that I have that option to take the day off without losing a way to pay my bills, that’s a relief that some people can’t even understand,” Green says. “One missed doctor’s appointment could be the last time to say goodbye.”

This blog originally appeared at inthesetimes.com on October 13, 2016. Reprinted with permission.

Jonathan Timm is a freelance reporter who specializes in labor and gender issues. Follow him on Twitter @jdrtimm.


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Our outdated school schedules are hurting working parents

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School schedules aren’t working for parents, and haven’t caught up to the reality of modern families’ lives.

The vast majority of parents 70 percent, work full-time from 8 a.m. to 5 p.m., but the median closing time for a school is 2:30 p.m. On top of that, schools are closed 80 percent longer than the typical worker receives in paid holidays and vacation time, which works out to 13 more days off than parents have, according to an analysis from the Center for American Progress.

That presents a problem for parents who work outside the home, especially mothers, single parents, low-income parents, parents of color, and part-time workers. Many of these demographics overlap, of course. Women of color in particular tend to make less money than white men and women and thus are less likely to be able to afford after-school programs and day care. Part-time workers also have far less vacation days and sick days than full-time workers.

This means the most disadvantaged populations in the United States are bearing the brunt of our school schedules-which are filled with extra days off around the holidays, days taken off for teachers’ professional development, snow days not offered by local employers, and policies mandating parents to pick up their sick kids, no matter how minor the illness.

Why a 9-to-5 schedule isn’t working for parents

Right now, schools are designed for families where one parent works outside the home and one parent stays home to care for the children, and is available to be on call to pick up their kids from school whenever necessary.

“Unfortunately the reality of working families has evolved a lot, and we need to invest in the kind of school policies and schedules to catch us up to the way people are actually living their lives,” said Catherine Brown, the vice president of education policy at the Center for American Progress and one of the authors of the new report. (Disclosure: ThinkProgress is an editorially independent site housed at the Center for American Progress.)

“We need to invest in the kind of school policies and schedules to catch us up to the way people are actually living their lives.”

The CAP report emphasizes the change in family work weeks. Between 1979 and 2006, the typical middle class family work week increased by 11 hours.

One might suggest after-school programs as the antidote to this problem, but these programs are not universally available, especially to the parents who need them most. Only 45 percent of all public elementary schools offer parents after-school care, according to CAP’s analysis of federal education data and only 31 percent of Title I schools have after-school programs.

Brown said school policies on picking children up from school also make parents’ lives very difficult. The report explains that schools often require parents to pick children up even when their illness is minor or non-contagious. Duval County Public Schools in Florida has a policy where parents are required to pick up an ill child within 60 minutes of being notified.

‘What will typically happen is your kid has a slight fever and they’ll call you and say you need to immediately pick them up and that’s just not viable,” Brown said. “If you’re working at McDonald’s or even if you’re working at CAP, it’s really hard to instantly abandon what you’re doing and go pick up your child, and this is a really clear way that schools disregard the needs of working parents.”

Brown added that these schedules often mean students go to recess or eat lunch very early in the day because they’re sharing a tight schedule with so many kids. Ideally, children’s schedules would be organized according to the natural ebb and flow of their energy levels throughout the day.

The creative solutions that could help fix this issue

There is no reason why this inconvenient school schedule needs to remain in place, the authors of the report explain. The CAP report puts forth several ideas for reforming the way that school schedules work.

  • States could raise the minimum length of a school day to eight hours, which would push schools toward a typical work schedule.
  • Districts could use the assistance of AmeriCorps members, college students, and community members to help run programs during school closings and to monitor students when parents are at work.
  • Schools could limit days off to major holidays, look to major employers when deciding whether to close schools for inclement weather, and create school health policies that better recognize parents’ busy schedules.
  • Administrators could accommodate parents’ work schedules when deciding when to schedule parent-teacher conferences and consider alternatives to in-person meetings, such as chatting through Skype.
  • Schools could look at more efficient ways to conduct teacher professional development, such as having teacher development run throughout the school day through teacher collaboration and individualized coaching, so the school wouldn’t have to close for the day.
  • Schools could identify alternatives to a tiered busing schedule, such as a dual-route system, so that students can get to school at the same time.

How a new school schedule would affect teachers

One of the most challenging questions facing advocates for a 9-to-5 school schedule is how to ensure teachers aren’t shortchanged in the process. After all, teachers come in early to prepare for classes and often stay later to assist students and grade papers?—?they don’t want to make their days even longer.

Staggered schedules could ensure that teachers don’t work longer hours than they already do. But if they do end up adding more hours to their workday, advocates say teachers should be fairly compensated.

“What we want to be clear about is that we’re not advocating for teachers to work longer hours without getting compensated for that time,” Brown said.

She added that kids can also do independent work an work in peer-to-peer groups that allow teachers time to do planning, give kids more time to learn, and reduce parent stress.

Ulrich Boser, a senior fellow for education policy at CAP, said there is also the possibility of teachers working a 9-to-5 schedule but doing so only four days a week. Teachers who work at Goldie Maple Academy in Queens, for example, have a school day that begins at 8 a.m. and ends at 4:35 p.m. but they have Fridays off.

How to pay for a longer school day

Keeping schools open longer will cost more money. But there are federal funds available to help school districts pay for lengthening their days.

In 2015, the U.S. Department of Education released guidance explaining that as long as extended school days are “meeting an identified need to improve student achievement,” a federal source called Title I, Part A fund can be used toward paying for it. Other federal funding sources include Promise Neighborhoods competition, Full-Service Community Schools Program, and Community Learning Centers program.

Congress could also include a competitive grant program in the Higher Education Act to encourage graduate schools in social work to partner with neighboring school districts to develop a 9-to-5 schedule.

This new schedule could also be considered a “school theme” in the way technology or bilingualism is considered a theme for many schools. These schools could be funded through competitive grant programs targeted at low-income schools.

Some of these policy proposals are easier to implement than others, but Brown said innovation is necessary to acknowledge the needs of working parents.

“I think requiring longer school days requires an injection of resources and creative thinking about how you set up your schools,” Brown said.

This blog originally appeared at Thinkprogress.org on October 12, 2016. Reprinted with permission.

Casey Quinlan is an education reporter for ThinkProgress. Previously, she was an editor for U.S. News and World Report. She has covered investing, education crime, LGBT issues, and politics for publications such as the NY Daily News, The Crime Report, The Legislative Gazette, Autostraddle, City Limits, The Atlantic and The Toast.


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Enormous, Humongous August Trade Deficit Prompts Trade Deficit Bill

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dave.johnsonThe U.S. Census Bureau reported Wednesday that the August trade deficit rose 3 percent to $40.73 billion from July’s $39.5 (slightly revised). Both exports and imports rose, with imports rising more than exports. August exports were $187.9 billion up $1.5 billion from July. August imports were $228.6 billion up $2.6 billion.

The goods deficit was $60.3 billion, offset by a services surplus of $19.6 billion.

Imports from China increased 9.5 percent.

Is Increased “Trade” Good If It Really Means Increased Trade Deficits?

“Trade” is generally considered a good thing. But consider this: closing an American factory and firing its workers (not to mention the managers, supply chain, truck drivers, etc affected) and instead producing the same goods in a country with low wages and few environmental protections, then bringing the same goods back to sell in the same stores increases “trade” because now those goods cross a border. This is how “trade” results in a structural trade deficit. Goods once made here are made there, the economic gains move from here to there.

Offshoring production can be a good thing, but only in a full-employment economy. This is because with everyone employed companies can’t find people to do things that need to be done. Meanwhile workers in other countries need the jobs. The people there can afford things made here, and trade balances. Everyone benefits.

But since the 1970s the US has used “trade” and other policies to intentionally drive unemployment up and wages down, to the benefit of “investors” (Wall Street) and executives, who then pocket the wage differential. This pushes the economy’s gains to a few at the top, increasing inequality, which increases the power of plutocrats to further influence policy in their favor.

The US has run a trade deficit since the 1970s. Coincidentally, see this chart:

The stagnation of wages for working people just happens to correspond with the introduction of the intentional “trade” deficit. Again, “trade” in this case means deindustrialization: closing factories here, opening them there and bringing the same goods across a border to sell in the same stores.

Trade Deficit Reduction Act

This week Rep. Louise Slaughter (D-NY) introduced a bill designed to identify and reduce our enormous, humongous trade deficits. RochesterFirst.com has the story, in Slaughter introduces legislation to reduce trade deficits,

On Monday, Congresswoman Louise Slaughter unveiled the Trade Deficit Reduction Act, which calls for a change in how we approach international trade in order to benefit our workers.

The legislation would put a government-wide focus on addressing the most significant trade deficits that exist between the United States and other countries. The U.S. has run trade deficits since the 1970s.

… “The last thing our community needs as we work to reignite our manufacturing base with advanced technologies like optics and photonics is to undo this progress by enacting another NAFTA-style trade deal. We need a whole new direction in our trade policy, which is why I am standing with workers from PGM Corp. today to unveil the Trade Deficit Reduction Act. This legislation will change how we approach international trade and make it benefit our workers and manufacturers,” said Slaughter.

The bill would require the administration to identify the countries with which the U.S. has the worst trade deficits.

The bill also directs the administration to develop plans of action to address the trade deficits with those countries, with strict deadlines and oversight from Congress.

The intentional trade deficit and other policies to drive up unemployment and drive down wages greatly enrich a few, but history tells us the consequences are dangerous to society. For example, the rising support for Trump and other far-right populists like him around the world.

This post originally appeared on ourfuture.org on October 6, 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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Chicago Teachers Are on the Verge of Striking—This Is Why

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Chicago teachers will likely take to the streets early Tuesday in an escalation of their campaign to defend their jobs and improve the education of the students and the communities they serve. The Chicago Teachers Union (CTU) has said it will strike if no deal is reached by midnight.

Four years ago, the CTU won a new contract with a dramatic 7-day strike that captured national attention. Although the CTU was unable in the following years to stop Mayor Rahm Emanuel from closing more than 50 schools, last April the union continued its contract fight with a mayoral-appointed Board of Education by calling for a 1-day strike over the failure of talks to renew their contract.

With the CTU and Chicago Public Schools (CPS) still at loggerheads over a new agreement, the teachers are preparing to establish picket lines once again at schools throughout the nation’s third-largest school system, taking on the Board of Education, Emanuel, the obsessively anti-union Republican governor, Bruce Rauner, and the local business class.

The fight is, in various ways, about money. The Board of Education, under Emanuel’s control, says it must cut costs since it is running a deficit. One of its proposed solutions would eliminate a longstanding agreement to pay for part of the cost of teachers’ pensions, effectively cutting teachers’ pay.

Rauner advocates a harsh and ideological strategy designed to humiliate the teachers and break their union. He has said bankruptcy might be the best option for CPS—a move that would allow a court to void union contracts.

But the strike is about more than money, too. The CTU sees negotiations as a chance to focus on the quality of education for Chicago students. The union wants to reduce class sizes, guarantee that all schools have libraries and librarians, give teachers professional support and training to teach more creatively, and provide social services and counselors who can help students resolve problems that may be interfering with their learning or leading them to drop out.

“In my 13 years of teaching, schools and students have never faced this type of assault,” said Lillian Kass, a special education teacher in CPS and a CTU delegate.

“We are going on strike to protect our students from further cuts. We need enforceable class sizes and adequate services so all students can succeed. Teachers and students have already suffered too many cuts. More cuts are not acceptable and not sustainable,” she said.

Historical backdrop

The contract dispute is linked to profound and pernicious questions regarding class and racial divisions in the city and state. The backdrop to the current conflict is the decades-long failure of the state government to follow the state’s constitutional mandate to carry the primary responsibility for financing public education.

As a result, schools are very unevenly and inequitably funded by local property taxes. The tax burden is greatest on working-class households, while businesses successfully resist paying their fair share. Chicago taxpayers suffer an additional burden: While state taxes—including taxes paid by Chicago residents—help fund teacher pensions for the rest of the state, Chicago residents alone pay for all pension-related costs for their schools.

Low-income communities, especially those that are predominately black, have suffered most from shortcomings in funding, school closings and many other CPS policies. Reinforcing the results of other investigations, a recent report by WBEZ, the Chicago public radio station, revealed that new school construction in areas of the city where the population is growing is carefully planned to maintain high levels of racial segregation, even though it would be easy to use the construction to create a more integrated school enrollment.

Community allies

Union leaders see community groups as crucial allies in the fight now unfolding. Chicago Teachers Solidarity Campaign (CTSC), with a dozen or more members, played an important role in the 2012 strike, says Steven Ashby, a labor educator at the University of Illinois. Ashby, who is the leader of a renewed CTSC, says the new coalition already includes more than 50 groups.

The CTU, CTSC and many other progressive groups are pushing for the city to redirect to the schools as much as possible from Tax Increment Financing (TIF), a funding tool. The money is largely a “slush fund” spent at the mayor’s discretion for business-related projects, and reformers argue that it could provide significant funding for schools.

The issues posed by the teachers’ strike involve a tangle of inherited pathologies of racism, business dominance, and corrupt local politics—together forming a Gordian knot that blocks progressive reform. The strike may not cut the knot, but it could help direct the next blows for reformers tackling the many challenges beyond the current, critically important task of educating the city’s children.

This blog was originally posted on In These Times on October 10, 2016. Reprinted with permission.

David Moberg, a senior editor of In These Times, has been on the staff of the magazine since it began publishing in 1976. Before joining In These Times, he completed his work for a Ph.D. in anthropology at the University of Chicago and worked for Newsweek. He has received fellowships from the John D. and Catherine T. MacArthur Foundation and the Nation Institute for research on the new global economy. He can be reached at [email protected]


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SEC Orders Company to Pay $500K For Whistleblower Retaliation

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This past week, the SEC brought its first enforcement action ever to be based solely on retaliation against a whistleblower.  On September 29, 2016, the SEC ordered International Game Technology (IGT) to pay a $500,000 penalty for terminating the employment of a whistleblower because he reported to senior management and the SEC that the company’s financial statements might be distorted.  Though this is the second time the SEC has exercised its authority under the Dodd-Frank Act to redress whistleblower retaliation, it is the SEC’s first stand-alone retaliation case.  The enforcement action underscores the high value the agency places on whistleblowers and indicates that the SEC Office of the Whistleblower will remain an aggressive advocate for whistleblowers under its new director, Jane Norberg.

Background

The whistleblower joined IGT in 2008.  When IGT terminated his employment on October 30, 2014, the whistleblower was a division director with a budget of more than $700 million and supervisory responsibility for up to eleven direct reports.  Throughout his tenure at IGT, he received exceptional ratings and was described as the VP’s Supervisor’s top employee, as a “high potential” employee, and as an employee with a potential “future assignment” at the vice-president level.  In addition, IGT even sought authorization from senior resources managers to pay him a special retention bonus.

Starting in June 2014, the whistleblower led several projects to determine whether it was cheaper for IGT to refurbish used parts using outside vendors or through internal refurbishment.  During the project, the whistleblower became concerned that IGT was improperly accounting for costs associated with refurbished used parts.  Although the whistleblower was not an accountant in the company, he reasonably believed that the company’s current method resulted in a $10 million discrepancy in the financial statements.

On July 30, 2014, the whistleblower reported his findings to his supervisors during a presentation.  After raising concerns about the accounting method and its impact on the financial statements, the whistleblower had a heated disagreement with the executive supervisor on the issue.  Immediately following the meeting, the executive supervisor emailed the whistleblower’s supervisor regarding the presentations, stating that, “I can’t allow [the whistleblower] to place those inflammatory statements into presentations, if there is not basis in fact.”

Thereafter, IGT conducted an internal investigation into the allegations made by the whistleblower.  During the investigation, IGT retaliated against the whistleblower by removing him from job opportunities that were significant to performing his job successfully.  On October 31, 2016, the internal investigation concluded that IGT’s cost accounting model was appropriate and did not cause its financial statements to be distorted.  That same day, IGT terminated the whistleblower.

SOX’s Reasonable Belief Standard Provides Broad Protection

Although the whistleblower’s concern was ultimately incorrect, he was still protected under the SEC Whistleblower Program because he reasonably believed that IGT’s cost accounting model constituted a violation of federal securities laws.  Recently, the trend in federal courts has been to broadly construe protected activity under this reasonable belief standard.  This is a departure from the previous requirement that whistleblowers “definitively and specifically” identify the alleged violation at issue, which undermined potential whistleblowing.

The courts’ broad interpretation of the reasonable belief standard is important because whistleblowers’ must be free to make good faith disclosures, even if they end up being wrong.  As Andrew J. Ceresney, director of the SEC’s Division of Enforcement, said, “[s]trong enforcement of the anti-retaliation protections is critical to the success of the SEC’s whistleblower program.  This [IGT] whistleblower noticed something that he felt might lead to inaccurate financial reporting and law violations, and he was wrongfully targeted for doing the right thing and reporting it.”

Similarly, Jane A. Norberg, Chief of the SEC’s Office of the Whistleblower, stated that “[b]ringing retaliation cases, including this first stand-alone retaliation case, illustrates the high priority we place on ensuring a safe environment for whistleblowers.  We will continue to exercise our anti-retaliation authority when companies take reprisals for whistleblowing efforts.”

Prior SEC Enforcement Action for Whistleblower Retaliation

The IGT enforcement action is consistent with an SEC enforcement action against hedge fund advisory firm Paradigm Capital Management (“Paradigm”), which also redressed whistleblower retaliation.  On June 16, 2014, the SEC announced that it was taking enforcement action against Paradigm for engaging in prohibited principal transactions and for retaliating against the whistleblower who disclosed the unlawful trading activity to the SEC.

According to the order, Paradigm retaliated against its head trader for disclosing, internally and to the SEC, prohibited principal transactions with an affiliated broker-dealer while trading on behalf of a hedge fund client. The transactions were a tax-avoidance strategy under which realized losses were used to offset the hedge fund’s realized gains.

When Paradigm learned that the head trader had disclosed the unlawful principal transactions to the SEC, it retaliated against him by removing him from his position as head trader, changing his job duties, placing him on administrative leave, and permitting him to return from administrative leave only in a compliance capacity, not as head trader. The whistleblower ultimately resigned his position.

Paradigm settled the SEC charges by consenting to the entry of an order finding that it violated the anti-retaliation provision of Dodd-Frank and committed other securities law violations, agreeing to pay more than $1 million to shareholders and to hire a compliance consultant to overhaul their internal procedures, and entering into a cease-and-desist order.

The SEC’s press release accompanying the order includes the following statement by Enforcement Director Ceresney: “Those who might consider punishing whistleblowers should realize that such retaliation, in any form, is unacceptable.” The Paradigm enforcement action suggests that whistleblower retaliation can result in liability far beyond the damages that a whistleblower can obtain in a retaliation action and that retaliation can invite or heighten SEC scrutiny.

These enforcement actions signal to companies that retaliating against a whistleblower can result not only in a private suit brought by the whistleblower, but also in a unilateral SEC enforcement action.  The IGT action in particular indicates that employers cannot take adverse actions against whistleblowers, even when the underlying disclosure is in error.

For more information about whistleblower protections and whistleblower rewards, call the whistleblower lawyers at Zuckerman Law at 202-262-8959.

This blog originally appeared at ZuckermanLaw.com on October 4, 2016. Reprinted with permission.

Jason Zuckerman, Principal of Zuckerman Law, litigates whistleblower retaliation, qui tam, wrongful discharge, discrimination, non-compete, and other employment-related claims. He is rated 10 out of 10 by Avvo, was recognized by Washingtonian magazine as a “Top Whistleblower Lawyer” in 2007 and 2009 and selected by his peers to be included in The Best Lawyers in America® and in SuperLawyers.


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Fight for $15 workers file sexual harassment complaints against McDonald’s

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LauraClawson

Workers who are underpaid are all too often exploited and abused in other ways—after all, their employers know they’re vulnerable and need the paycheck. So we should be shocked, but not too surprised, by the contents of sexual harassment complaints against McDonald’s that the Fight for $15 has filed with the Equal Employment Opportunity Commission:


Cycei Monae, a McDonald’s worker in Flint, Michigan, said a manager showed her a picture of his genitals and said he wanted to “do things” to her, according to a complaint provided by Fight for $15. Corporate officials ignored her complaints, Monae said on a phone call with reporters on Wednesday.

In another complaint, a worker in Folsom, California, said a supervisor offered her $1,000 for oral sex.

Thirteen of the complaints were by women, and two were by men, said Fight for $15, which the Service Employees International Union formed in 2012.

gettyimages-496499558Expect McDonald’s to once again fall back on its excuse that it can’t possibly control anything about what franchisees do to their workers, even as it controls every other aspect of how franchise restaurants operate. That control is why the National Labor Relations Board has said McDonald’s should be treated as a joint employer of workers in franchise restaurants.

Issues like sexual harassment are why the Fight for $15 isn’t just about $15 an hour pay—workers say they’re fighting for “$15 and a union.” A union could represent workers facing harassment and give them power in numbers and tools to fight back. This is a fight more broadly for power and respect. Money is part of that, but it’s not the whole deal.

This article originally appeared at DailyKOS.com on October 5, 2016. Reprinted with permission.

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


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A governor just sued his own attorney general over LGBT employment protections

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pphlnood_400x400The attorney general said he wasn’t going to stop blocking contracts unless he was sued, so the governor sued.

Louisiana’s governor just sued its attorney general over whether lawyers the state hires should be allowed to discriminate against LGBT people.

If that sounds odd, that’s because it is. And though there’s an easy moral answer to the conundrum, the legal answer might be far more complicated.

Gov. John Bel Edwards (D) was elected last year to succeed Bobby Jindal (R). One of the first things he did when taking office was reverse Jindal’s anti-LGBT policies, including Jindal’s executive order allowing businesses to discriminate against same-sex couples without any consequence from the state. Edwards then issued his own executive order protecting state workers and contractors from discrimination on the basis of sexual orientation and gender identity. It was nearly identical to President Obama’s 2014 executive order protecting LGBT federal employees and contractors, as well as Louisiana gubernatorial executive orders protecting LGB state employees that were in place before Jindal rescinded them in 2008.

But despite both the state and federal precedent for such executive action, Attorney General Jeff Landry (R) wasn’t having it. Prompted by anti-LGBT lawmakers opposed to both Edwards’ executive order and the Obama administration’s guidance protecting transgender students, he issued an eight-page opinion in May declaring that neither was legally enforceable in the state.

“The brief answer is an Executive Order cannot expand or create state law,” Landry wrote. “‘Gender identity’ is not and has never been a legally protected class under state or federal anti-discrimination laws.” He insisted that the order protecting LGBT employees “should be interpreted as merely aspirational and without any binding legal effect.”

Even giving Landry the benefit of the doubt that he was just trying to check the power of the executive, his own anti-LGBT biases are not in doubt. He also said that the federal transgender guidance “creates an environment in which children may be more easily exposed to sexual predators.” Rules simply affirming transgender students’ identities “place the mental well-being and privacy rights of ninety-nine percent of Louisiana’s children at risk without any demonstrable evidence of benefit to the less than one percent of the population this policy purports to benefit.”

For the past four months, Landry and Edwards have engaged in this standoff, warring over state legal contracts. Edwards keeps including LGBT nondiscrimination language in proposed contracts with private lawyers, and Landry keeps blocking them specifically because of this language. He hasblocked at least 37 contracts, including 11 from the Department of Insurance. Defending his actions, Landry’s office has asserted, “The Attorney General requires antidiscrimination clauses in legal contracts to be written in conformity with State and Federal law, therefore, these provisions should not contain language exceeding what the law requires.”

Matthew Block, general counsel for the Edwards administration, explained last week that these blocked contracts are starting to have a big impact on the management of the state. “We have a lot of things that need to get attended to and we need to have people doing their work,” he told NOLA.com. “I have law firms not getting paid for the work that they are doing. I have law firms that are waiting around to start work.”

1-ttjhkebbo9sxiijhid_lyaSo on Friday, Edwards sued Landry in state court. At a press conference Friday, he was pretty blunt about the standoff. “He basically told me that if I wanted him to approve those contracts that I would have to sue him,” Edwards said. “So I’m obliging him on that.”

The lawsuit states that Landry “has refused to perform the ministerial task of approving private contracts and appointing private counsel for numerous executive agencies of the State.” He has “explicitly rejected most of the contracts on the grounds that the contracting attorneys should not have agreed not to discriminate in employment and the rendering of services” in accordance with the executive order. In other words, the lawyers who would be impacted by the LGBT protections have already agreed to them, but Landry has still denied the contracts because that language is in them.

The conflict is spurring some interesting political divisions. For example, Louisiana Senate President John Alario (R), voted against LGBT nondiscrimination protections in the legislature, but he told NOLA.com that he believes the governor isn’t overstepping his authority. It’s Landry, he said, who he thinks “is stepping out of bounds.”

Landry has stood by his actions, saying in an interview that he looks forward to “defending the legislature and their priorities and their wishes.” He added that he believes the protections create “additional liabilities and expenses for the state,” but refused to answer questions about his own position on protecting LGBT people from discrimination.

It will now be up to the state courts to resolve the conflict, or at least to interpret whether Landry is within his authority as attorney general to rebuff the executive order. It could, however, be the first time that a court weighs the validity of an executive order that protects workers from discrimination.

But Louisiana is hardly an outlier for the actions Edwards took. There are 12 other states that, through executive order or similar administrative regulation, extend employment protections to state employees on the basis of sexual orientation or gender identity that exceed protections under state law. And of course, past Louisiana governors protected sexual orientation without having to sue their attorneys general to enforce them.

This article was originally posted at Thinkprogress.org on October 5, 2016.
Reprinted with permission
.

Zack Ford is the LGBT Editor at ThinkProgress.org. Gay, Atheist, Pianist, Unapologetic “Social Justice Warrior.” Contact him at [email protected]. Follow him on Twitter at @ZackFord.

 


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Contract for Disaster: How Privatization Is Killing the Public Sector

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mtm0ndg4mjmzmzyxodm5mzc4Privatization is bad news for federal, state and local government workers, and the communities where they live. That’s according to a new report released Wednesday by In the Public Interest, a research group focused on the effects of privatization.

The study, “How Privatization Increases Inequality,” explores the role privatization plays in the American economy—compiling data on the estimated $1.5 trillion of state and local contracts doled out each year.

“A lot of decisions are small,” says Donald Cohen, executive director of In the Public Interest, but “if you add all that up, it’s very significant.”

Many government workers in the United States enjoy a robust structure of pay and benefits, including pensions, health care and paid time off. Workers operate in a structured environment that acts, as the report says, as a ladder of opportunity. A clearly outlined framework of positions and pay grades, backed by enforcement of antidiscrimination laws, makes government jobs particularly friendly to women and people of color—20 percent of public sector jobs are held by Black workers, while nearly 60 percent of public sector jobs are held by women.

(Joe Brusky/ Flickr)
(Joe Brusky/ Flickr)

For decades, work in the public sector has been a gateway to a middle-class life. But that’s changing.

Cohen notes that the Right managed to make privatization an ideological project. This shift has generated huge profits for corporations and harmed public sector workers and their unions.

“They want to contract out not because it makes sense, but because that’s their jobs. They’re right-wingers,” he says.

Privatized workers have lower rates of unionization, are paid less than their publicly-employed counterparts, don’t have access to benefits and experience high turnover, the report shows. Sometimes they work side-by-side with government employees, as at the University of California system, something that Cohen says is deliberate.

“Part of the strategy of management is to contract out part of the work to keep the pressure on the non-contract part of the work,” he says.

That strategy leaves workers shortchanged—literally. In 2013, the National Employment Law Project found that one in five federal contractors it interviewed was using Medicaid for health care, while 14 percent needed Supplemental Nutrition Assistance (SNAP). Reliance on federal benefits shifts costs from employers to taxpayers.

Contract employees are caught in a poverty trap that hurts not just them, but their communities. Workers who aren’t making money aren’t spending it, dragging down local businesses and creating a ripple effect in regional economies.

The report argues that poor recordkeeping and limited transparency make it extremely difficult to gauge the effects of contracting, and that the public needs to have access to such information. Legislators, advocates, unions and workers should be invested in how, when, where and why contract labor is used.

Is it improving services while keeping standards high for workers? Or is it being used as an ostensible cost-cutting measure, harming workers and shifting expenses to taxpayers and their communities?

We’re seeing a new era of work in America, and the move to contractors over directly-employed government workers is highlighting that shift as well as its consequences. For government workers, privatization is an economic shell game, and they are losing.

This blog originally appeared at inthesetimes.com on September 28, 2016. Reprinted with permission.

S.E. Smith is an essayist, journalist and activist is on social issues who has written for The Guardian, Bitch Magazine, AlterNet, Jezebel, Salon, the Sundance Channel blog, Longshot Magazine, Global Comment, Think Progress, xoJane, Truthout, Time, Nerve, VICE, The Week, and Reproductive Health Reality Check. Follow @sesmithwrites.


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