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Donald Trump Is Using the Coronavirus Crisis to Attack Social Security

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Image result for nancy altmanDonald Trump’s proposal to cut the payroll contribution rate is a stealth attack on Social Security. Even if the proposal were to replace Social Security’s dedicated revenue with deficit-funded general revenue, the proposal would undermine this vital program.

The proposal is a Trojan horse. It appears to be a gift, in the form of middle-class tax relief, but would, in the long run, lead to the destruction of working Americans’ fundamental economic security. While the goal of the proposal is stated in terms of fiscal stimulus, its most important impact, if not its intent, is to do what opponents of Social Security have been unable to do—end Social Security as we know it.

The supposed purpose of a reduction in payroll contributions is to address the coronavirus crisis. Tax cuts do not meaningfully address the coronavirus, or even the resulting market panic. We do want to ensure that people have the cash they need while they face massive uncertainties around employment and other costs. We want people to stay home as much as needed without having to worry about paying their rent or other costs. What we need most is a robust public health response, which the Trump administration is utterly failing to provide.

Alongside that vital public health response, there are better options for economic stimulus. These include a one-time progressively structured direct payment, restoring and expanding the Making Work Pay Tax Credit, or expanding the existing Earned Income Tax Credit and provide greater economic stimulus, are more targeted and equitable, and place no administrative burdens on employers. The only reason to support Trump’s proposal above those others is to undermine Social Security.

As revealed in this chart, cutting the payroll contribution rate is a deficient stimulus. Most of the benefit would go to the wealthiest Americans—including CEOs, senators, congresspeople, and members of the Trump administration—who are the least likely to spend the extra money. The other big winners are the nation’s largest corporations and other employers. The lower workers’ wages are, the lower their benefit. Moreover, those state and local employees who do not participate in Social Security would get nothing.


What Trump is proposing to cut, to be clear, are Federal Insurance Contributions Act payments. As the name indicates, these payments are not general taxes, but insurance contributions, or, in today’s parlance, insurance premiums. By law, they can only be used to pay Social Security insurance benefits and their associated administrative costs. Social Security has no borrowing authority. Consequently, Social Security does not and, by law, cannot, add even a penny to the deficit. If Social Security were ever to have insufficient revenue to cover every penny of these costs, those benefits would not be paid.

The late President Ronald Reagan eloquently explained, in his words, “Social Security has nothing to do with the deficit.” This proposal would change that, at least temporarily, if Social Security’s dedicated revenue were replaced with general revenue. (Of course, more accurately, the dedicated revenue would be replaced with borrowed money since the general fund is running unprecedently large deficits.)

The proposal would either undermine Social Security’s financing or employ general revenue, both of which would set the stage for future demands to cut Social Security. And it likely would not be temporary. When the cut would be set to expire, opponents of Social Security would undoubtedly characterize its expiration as a middle-class tax increase.

Too many Americans believe, understandably, that their Social Security contributions have been stolen. Using their contributions for economic stimulus would reveal that their elected officials indeed do not respect the fire wall between their contributions that are held in trust and can be used only for their dedicated purpose and the taxes they pay to the federal government that are held in the general fund and can be used for any constitutional purpose that Congress chooses.

On March 8, Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer released an excellent list of steps we should take to combat the coronavirus. Their plan includes paid sick leave, free coronavirus testing, and treatment for all. Our government should enact these measures, not undermine Social Security by slashing its dedicated revenue.


This article was originally published at Our Future on March 12, 2020. Reprinted with permission.

About the Author: Nancy Altman  is a writing fellow for Economy for All, a project of the Independent Media Institute. She has a 40-year background in the areas of Social Security and private pensions. She is president of Social Security Works and chair of the Strengthen Social Security coalition. Her latest book is The Truth About Social Security. She is also the author of The Battle for Social Security and co-author of Social Security Works!




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Why Retirement Insecurity Is the New American Epidemic

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The Dow Jones Industrial Average just dropped nearly 1,200 points in a single day because of the coronavirus’s impact on global trade, leaving many Americans sick with worry.

It’s not just a rapidly spreading, mysterious disease that made Americans feel vulnerable. The Dow’s freefall erased millions of dollars from retirement accounts and exposed another kind of epidemic—retirement insecurity.

There once was a time when the combination of company pension plans, Social Security and personal savings could carry retirees through their golden years.

No longer. Most companies eliminated defined-benefit plans providing a reliable income stream and implemented 401(k) plans that leave workers at the mercy of stock market volatility, like the kind that rattled investors recently and crushed workers in 2008.

Today, Americans have so much angst about the future that about 29 percent of baby boomers, 36 percent of Gen Xers and 77 percent of millennials fear they’ll never be able to retire or will have to work past normal retirement age.

Americans work hard so they can provide for their families and enjoy retirement. But no matter how carefully they plan, their retirements depend on factors beyond their control.

Patricia Cotton, a home health aide in Maryland, lost half of her $150,000 investment nest egg in the 2008 recession and retired 12 years later than planned.

In all, Americans lost about $2.4 trillion in retirement earnings during the second half of 2008, and the average household lost a third of its net worth.

Cotton was one of many who experienced losses so severe that they had to work longer than intended. The memory of the 2008 recession still gives Americans retirement jitters, and stock market drops like we’ve just seen compound the fear.

Before 401(k) plans dominated the retirement landscape, companies provided defined-benefit pensions. Workers earned specific—defined—amounts based on their wages and years of service. When workers retired, the employer provided those amounts no matter how the stock market fared.

But now, even workers and retirees with these plans can lose what they earned. For example, 1.3 million Americans are in about 150 multiemployer pension plans at risk of collapsing.

These plans, enrolling workers from two or more companies in fields such as transportation and paper, lost investment earnings in the 2001 and 2008 recessions. Some companies also used bankruptcies to wriggle out of pension obligations. Now, the plans owe more money to beneficiaries than they have coming in.

Because of financial problems plaguing her late husband’s plan, Mary Fry saw her pension cut by more than half, to $1,514 a month, in her early 70s. “It’s worrisome,” she said, “and I don’t think I need worry in my life right now.”

The U.S. House last year passed the Butch Lewis Act, a measure that would provide low-interest loans to save multiemployer plans, but Senate Republicans refuse to consider it.

Instead, Republican Sens. Chuck Grassley of Iowa and Lamar Alexander of Tennessee want to prop up the plans with higher taxes on workers and retirees. Workers didn’t create the problem, but Grassley and Alexander expect them to fix it.

The senators also want to impose hefty new fees on multiemployer plans, something that would push even the healthy ones into financial ruin.

Meanwhile, pensioners agonize about losing houses or paying medical bills if their plans fold. Others try to conserve as much as they can.

Alan Ebert, a United Steelworkers (USW) member who retired about four years ago from a Louisiana paper mill, is in a multiemployer plan at risk of insolvency in 10 years.

He wants to put off collecting Social Security as long as he can. Retirees who delay collecting benefits after their eligibility dates get bigger checks when they do tap into the system, and Ebert hopes to maximize his Social Security in case his multiemployer plan fails.

But Social Security also is imperiled. Some Americans fear it won’t even be around when they’re old enough to retire.

If Congress fails to bolster the trust funds within about 15 years, the program will have to reduce benefits by about 20 percent. That would impoverish millions of retirees.

Mass retirement of baby boomers stresses the program. By 2030, Social Security will have 44 recipients for every 100 workers paying into the system, up from 35 recipients per 100 workers in 2014. But that isn’t the only reason for the funding crisis.

Rich people don’t pay their fair share in Social Security taxes. That’s left billions in badly needed funding on the table.

Federal law ostensibly requires Americans to pay 6.2 percent of their wages in Social Security taxes. However, earnings above $137,700 aren’t taxed at all. That means millionaires and billionaires really pay a Social Security tax of less than 1 percent.

While average Americans pay Social Security taxes all year, a person making $1 million stopped contributing on February 19. Bigger earners finished even earlier.

Making millionaires and billionaires pay Social Security taxes at the same rate as ordinary Americans would stabilize the program.

Under the current, broken system, the rich feather their own nests at everyone else’s expense. They enjoy cushy retirements while average workers struggle to provide for the present, let alone the future.

Because of decades of stagnating wages, many workers live paycheck to paycheck. Some juggle multiple jobs.

They’re saddled with medical bills and college debt and can’t afford an unexpected $400 expense.

Many Americans have nothing to bank for old age.

Roberta Gordon, for example, worked all of her life. But she held a variety of low-paying jobs that provided no pension, meager Social Security benefits and zero savings.

So, at 76, Gordon spent her Saturdays working at a California grocery store, handing out food samples for $50 a shift. She got her own groceries at a church food bank.

Passing the Butch Lewis Act is one step the Senate can take to ease Americans’ retirement insecurity. Making the rich contribute their fair share to Social Security is another commonsense move Congress owes the American people.

Right now, many worry that their resources will expire before they do.

This article was produced by the Independent Media Institute. Reprinted with permission. 

About the Author: Tom Conway is international president of the United Steelworkers (USW).


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Facing Retirement With Fear

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Glen Heck spent 28 years sweating in a Campti, La., paper mill that he likes to say was “hotter than nine kinds of hell.”

But now, Heck’s sacrifice may have been for nothing because his multiemployer pension plan is one of about 150 nationwide set to go broke. If that happens, the 78-year-old Heck will have to find a cheaper, lower-quality health plan and keep the beef herd he’s itching to sell.

The Democratic-controlled House passed—with bipartisan support—a commonsense plan to save Heck’s pension and those of another 1.3 million workers, retirees and widows. But Republican leaders in the Senate refuse to consider it.

In the meantime, the futures of workers and retirees like Heck hang in the balance. Many face retirement with fear instead of anticipation.

Multiemployer pension plans like Heck’s include workers from two or more companies in industries such as transportation, entertainment, construction and paper. Employers make contributions for workers as part of their compensation. Heck and others often give up wage increases or other benefits to fund those plans.

Many of the 1,400 plans nationwide are still healthy. But through no fault of workers or retirees, about 150 are struggling.

Recessions in 2001 and 2008 cut the plans’ investment earnings, and some corporations used bankruptcies to evade pension obligations. Deregulation forced less-competitive companies out of business, straining the plans’ resources.

Now, they owe more money to beneficiaries than they have coming in, and they’re at risk of collapsing. The PACE Industry Union-Management Pension Fund (PIUMPF)—Heck’s plan—is one of them. According to recent projections, the fund will be insolvent in as few as 10 years.

Under the bill passed by the House, the Butch Lewis Act, the Treasury Department would loan money to troubled plans. The plans would use the money to meet their obligations to retirees, and they would repay the loans over 30 years.

The federal government already has an agency, the Pension Benefit Guaranty Corp. (PBGC), to pay benefits to retirees when multiemployer plans crumble. But it’s no substitute for the Butch Lewis Act.

PBGC provides only a fraction of the benefits beneficiaries earned. Also, so many plans are imperiled that the PBGC’s insurance program itself is at risk of collapse.

If plans fail, workers and retirees will lose as much as 98 percent of their benefits. The Butch Lewis Act would ensure that they receive the money they earned, not pennies on the dollar.

Heck, a former officer with United Steelworkers (USW) Local 13-1331 in Campti, knows widows of paper workers—one with a small child—who’d be financially devastated without their late husbands’ pensions. He knows a retiree with major health problems who’d have no way of paying medical bills without his pension checks.

“He’s just worried to death about it,” said Heck, who worked at the paper mill under a handful of operators, including current owner International Paper.

Cedric McClinton, president of Local 13-1331 and a technician at the paper mill, said pensions are the main source of retirement income for many workers and retirees. If those benefits get cut, there’s no easy way to make up the difference.

“You’re either looking at working longer—and who wants to work until you’ve got one foot in the grave and the other on a banana peel—or you’re looking at making concessions after you’ve worked all that time,” McClinton said.

Workers worry about downsizing their homes, giving up travel plans and going on government assistance programs.

“We talk about these things all the time,” McClinton said. “It’s real.”

Instead of passing the Butch Lewis Act to fix the pension crisis, Senate Republicans introduced legislation that would make the problem worse.

Sens. Chuck Grassley of Iowa and Lamar Alexander of Tennessee want to increase the premiums that retirement plans pay PBGC—something that would push currently healthy plans into financial ruin and put more workers’ retirements in jeopardy. The added costs also would propel some employers into bankruptcy, costing workers their jobs.

Grassley and Alexander also want to increase taxes on pensions, taking a bigger slice of the benefits workers earned and imposing a greater burden on retirees unable to afford it.

Workers and retirees didn’t create the pension crisis. But Grassley and Alexander want them to pay for it.

“That’s mind-boggling,” fumed Travis Birchfield, who’s lobbied for the Butch Lewis Act on behalf of Evergreen Packaging workers represented by USW Local 507 in Canton, N.C. “We’ve done bailouts and tax cuts for millionaires and billionaires, and then working people can’t get a damn loan?”

Uncertainty gnaws at Birchfield’s co-workers. Some in their 60s are thinking about retirement, but hesitate because of the pension crisis.

“They’ll ask us, ‘what do you think is going to happen?’ We can’t answer those questions,” Birchfield said.

McClinton and Birchfield pounded the halls of the Capitol to share members’ stories and concerns. But Senate Republicans fail to get the message.

Pensions aren’t perks or “extras.” Workers earned these benefits, and they rely on that money being there during their golden years, just as members of Congress count on receiving taxpayer-subsidized pensions when they leave office.

Failing to pass the Butch Lewis Act means consigning 1.3 million Americans to meager retirements. Some will fall into poverty after supporting themselves all of their lives. Many already see their dreams slipping away.

These hard-working men and women deserve immediate Senate passage of a responsible bill that safeguards their futures.

“Nobody’s trying to get rich here,” Birchfield stressed. “We’re just trying to get our retirements.”

This blog was originally published by AFL-CIO on February 14, 2020. Reprinted with permission. 

About the Author: Tom Conway is international president of the United Steelworkers (USW).


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NFL is working the refs to keep ex-players from claiming share of concussion settlement

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This week, hundreds of men will see their childhood dream become reality at the 2019 NFL Draft.

But, beneath all the tears and cheers, the pomp and circumstance, the National Football League and its lawyers are battling hard to deny benefits and compensation to the players who sacrificed their bodies and minds to build that NFL dream into what it is today.

At the beginning of 2017, a class-action lawsuit between the NFL and its former players was finalized for a settlement worth approximately $1 billion over the next 65 years. But instead of celebrating the outcome, retiring players and their families found themselves facing a marathon of paperwork and physicians, appeals and audits. By November of 2017, the New York Times reported that out of the 1,400 claims that had been submitted by retired players, only 140 had been approved.

While the approvals have picked up a bit in the intervening 17 months, this month, Senior Judge Anita Brody of the U.S. Eastern District of Pennsylvania unveiled new rules that will make the already-arduous claims process even more excruciating.

“The goal posts are continuously shifting,” attorney Lance Lubel, who represents about 75 players involved in the settlement, told ThinkProgress.

At the heart of this problem is the matter of a qualifying diagnosis of neurocognitive impairment, which is required for players to get money from the settlement.

There are two ways for players to go about obtaining this diagnosis. One is the Baseline Assessment Program (BAP), which is free for the players. However, there are many catches involved. Players are only permitted to get one examination through the BAP, and the claims administrator chooses the doctor and location of the exam. The BAP has an extremely high bar for players to pass. So far, Lubel says, 95 percent of the players who have gone through the BAP exam have failed to obtain a qualifying diagnosis. The overwhelming sentiment is that the BAP is an impenetrable defensive line put in place by the league to guard its money.

“The BAP protocols are not medical standards but rather settlement-engineered testing designed to weed out as many players as possible,” writes Sheila Dingus, who has documented the case extensively on her website, Advocacy for Fairness in Sport.

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The other way for players to get a qualifying diagnosis is to go through the Monetary Award Fund (MAF). In this instance, players are responsible for paying for the tests, but they are permitted to pick the doctor and schedule the appointment on their own.

And here is where the latest controversy has emerged. Last summer, the NFL filed an appeal that essentially sought to give league-trained physicians and administrators even more control over the process of determining a qualifying diagnosis. After a series of motions and closed-door hearings, on April 11, Judge Brody released updated MAF guidelines.

“The first [MAF guidelines document] was five pages long and mostly derived from the settlement agreement,” said Dingus. “This one…is a complete re-write.”

The new MAF guidelines are supposedly in place in order to prevent fraud and to bring the MAF standards more in line with the BAP standards. But, in practice, they seem to be geared toward preventing players from getting the relief they’re entitled to under the settlement.

According to the updated guidelines, the NFL-appointed and trained Appeal Advisory Panel (AAP) has much more control over the appeal process; retired players now must receive a diagnosis from a qualified MAF physician located within 150 miles of their primary residence; and neuropsychological exams must be conducted within 50 miles of the MAF physician.

“This rule effectively eliminates any choice of doctors for players,” Dingus said.

Additionally, MAF physicians are now required to obtain their patients’ “employment information and business activities” over the past five years, as well as “any social, community, recreational or other activities by the Retired NFL Football Player outside the home around the time of the MAF Examination, whether these activities have changed over the five years preceding the date of the MAF Examination and, if so, how they have changed.”

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The NFL likes to tout the success of the settlement by advertising that it has already paid out $645 million in claims — a significant amount of money that’s nearly what the league planned to spend for the entire 65-year period of the agreement. However, the primary reason that total amount is so large is because individual pay-outs for advanced diseases such as death by CTE, ALS, and Parkinson’s have been higher than expected.

Meanwhile, retired players suffering from dementia — a Level 1.5 of Level 2.0 neurocognitive impairment, according to the settlement — are being systematically excluded from the approval process, despite the fact that they were initially expected to make up a sizable proportion of the settlement’s beneficiaries.

According to the most recent report, only 12.9% of the Level 1.5 and 2.0 claims have been paid out, compared to 59% of the CTE claims, 64.8% of the ALS claims, 50.6% of Alzheimer’s claims, and 63.6% of Parkinson’s claims.

Lubel said that touting the $645 million figure occludes the real problem: The large number of retired players who are currently struggling and unable to get the assistance the settlement promised.

“It doesn’t do anything for the remaining guys that have not qualified yet, they’re left out in the cold,” he said.

Christopher Seeger, the co-lead counsel who represents the settlement class, has been a controversial figure throughout the entire settlement process; many other attorneys in the case have criticized him for carrying water for the NFL, and for being more concerned about making money for himself than he is about earning justice for his clients. Seeger has not made a public statement since the new rules have been released. His most recent statement was issued to Deadspin through a spokesman earlier this month.

“While we believe the settlement is working as intended with more than $645 million in approved claims, we respect the Court’s view that these measures will, as Judge Brody stated, ‘safeguard the integrity of the Settlement Program,’” Seeger said. “The rule regarding ‘generally consistent’ diagnoses is in fact administrative and will streamline the approval and payment of claims. The additional rules provided by the Judge appear to be aimed at addressing her previously expressed concerns regarding possible fraudulent claims. We will ensure these rules are implemented in a way that does not allow legitimate claims to be impeded in any way.”

That sounds reasonable. But lawyers and advocates who work with the suffering players and their families on a day-in-day-out basis have no way of holding Seeger to account. The entire claims process happens behind closed doors.

“The process needs to be more transparent,” Lubel said. “That’s what’s super frustrating about it, decisions are being made in a vacuum, and the stakeholders are not able to weigh in.”

This week, the NFL will spend a lot of airtime talking about how it’s a brotherhood. But its actions in this concussion settlement have spoken much louder than than their ad campaigns.

This article was originally published at ThinkProgress on April 22, 2019. Reprinted with permission.

About the Author: Lindsay Gibbs covers sports for ThinkProgress.


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Teacher strikes close schools across Oklahoma and Kentucky

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The red-state teachers rebellion that started in West Virginia continues to grow, with teachers in Kentucky and Oklahoma walking out on Monday after the Kentucky teachers shut down schools in nearly two dozen counties on Friday. In Oklahoma, dozens of school districts have announced closures for Monday, and many Kentucky schools are closed as well.

The Kentucky teachers are protesting a sudden retirement overhaul, while Oklahoma teachers are fighting for increased investment in their schools even after lawmakers voted them a substantial pay increase.

This package does not overcome a shortfall that has caused four-day weeks and overcrowded classrooms that deprive kids of the one-on-one attention they need,” Oklahoma Education Association President Alicia Priest said in a video posted on Facebook. “We must keep fighting for everything our students deserve.”

Arizona teachers, too, are calling both for pay raises and for increased education funding—and planning to take action if they don’t see improvements. Music teacher Noah Karvelis told NPR that he often has 40 students in a classroom with just seven pianos, and “The math just doesn’t add up. There’s no way to reach those kids. Every day you’re going home and you’re just feeling like, I failed. I failed these students. And that’s honestly the worst possible feeling any teacher could ever have.”

There’s a simple explanation for the education underfunding:

  • Arizona cut personal income tax rates by 10 percent in 2006, cut corporate tax rates by 30 percent in 2011, reduced taxes on capital gains, and reduced taxes in other ways over the last couple of decades.
  • Oklahoma cut personal income tax rates starting in 2004. The top income tax rate fell from 6.65 percent to 5 percent, with the latest drop taking effect in 2016 even as the state faced a $1 billion shortfall. Oklahoma also substantially reduced its severance tax on oil and gas, increased tax exemptions for retirement and military income, exempted capital gains income from taxation, and abolished the estate tax.

Disrespect for teachers is certainly at play in Republican-controlled states that pay salaries that leave teachers working second, third, and even sixth jobs, but it’s not just that. It’s also disrespect for students combined with short-term thinking that will harm people and economies. But hey, rich people will have really low taxes.

And that’s why teachers are fighting.

This blog was originally published at Daily Kos on April 2, 2018. Reprinted with permission.

About the Author: Laura Clawson is labor editor at Daily Kos.


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Labor Department wants to reward financial advisors at the expense of consumers

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The Labor Department would like to delay a rule that would require financial advisors to act in the best interest of their customers and their retirement accounts.

The federal court filing, made on Wednesday, said the department wants to delay implementation of the rule to July 2019. The full implementation of the rule is currently set for January 2018.

In February, President Donald Trump ordered a review of the Obama-era regulation. Financial companies and lobbyists representing them have opposed the rule. On the same day of the order, White House advisor Gary Cohn, who is a former Goldman Sachs executive, told the Wall Street Journal he thought it was a “bad rule.” Congress has introduced bills trying to kill the rule on multiple occasions.

Right now, there are two standards investors must be aware of — the fiduciary standard and suitability standard. A financial advisor operating under what is called the “suitability standard” is only required to make sure a client’s investment is suitable for the client’s finances, age, and risk tolerance at that point in time, but they don’t have a great legal obligation to monitor the investment for the client.

But under the fiduciary standard, an advisor has to keep monitoring the investment as well as the customer’s overall financial picture. Under the fiduciary standard, advisors also must disclose all of their conflicts of interest, fees, and commissions. Essentially, this makes it more difficult for advisors to push investments that will make them money but may not be in the best interest of their clients.

Retirement plans have changed a lot since the 1970s, when more private workers were enrolled in defined-benefit plans funded by their employers that promised a certain monthly benefit once they retired. Now more people have defined-contribution plans, which don’t promise a specific benefit for people when they retire, requiring them to contribute money to an account they are responsible for. Only 10 percent of workers older than 22 have a traditional pension and only 6 percent of Millennials do. Most workers have to choose how to invest these contributions and manage their own retirement savings but most Americans aren’t knowledgeable on investment decisions.

A 2016 Prudential Investments survey of more than 1,500 Americans showed 42 percent of Americans surveyed didn’t know how their assets were allocated in their portfolios, and 40 percent said they didn’t know how to prepare for retirement. Investment terms are often difficult to understand and investors may be overwhelmed by choices.

The financial industry argument against the rule is essentially that a commission system is necessary to pay for financial advice for the average investor, despite the adverse incentives it creates. Gary Burtless, an economist and senior fellow at the Brookings Institution, has disputed this argument.

“This claim does not seem terribly compelling. There are alternative ways to compensate financial advisors that do not create an obvious conflict between the interests of advisors and retirement savers,” Burtless writes.

The financial industry tried to persuade the public that investors were up in arms over the rule. The Financial Services Institute claimed that consumers sent over 100,000 letters with opinions on the rule. But Money reviewed 100 of the letters FSI claimed were from investors, and found that 64 percent came from financial advisors and people involved in financial companies.

The Trump administration would have to jump through numerous hoops to reverse the progress made on the rule, however, just as Obama officials did when they first wanted to advance the rule. The final rules were issued last year, but first the department took thousands of public comments, held four days of hearings, and 100 stakeholder meetings. The administration would have to field all of these comments and go through this process again to justify whatever changes it would make. It took about six years for the Obama administration to advance the fiduciary rule.

This article was originally published at ThinkProgess on August 10, 2017. Reprinted with permission.

About the Author: Casey Quinlan is a policy reporter at ThinkProgress. She covers economic policy and civil rights issues. Her work has been published in The Establishment, The Atlantic, The Crime Report, and City Limits.


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A Winning Week for Corporations and Wall Street—Paid for by Your Health and Retirement

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Corporations and Wall Street won big last week, and working people will pay a high price for it. Here are three things Congress did for Big Business that will harm working people’s health care and retirement:

1. 7 million fewer people will get workplace health benefits. Last Thursday, the U.S. House of Representatives passed the so-called American Health Care Act by a vote of 217-213. This is the bill that President Donald Trump and House Speaker Paul Ryan (R-Wis.) are using to repeal much of the Affordable Care Act and that will cut health coverage for some 24 million people. The U.S. Senate now has to vote.

Professional lobbying groups that represent employers, like the U.S. Chamber of Commerce, are behind this bill because it guts the Affordable Care Act’s requirement that large and mid-size employers offer their full-time employees adequate, affordable health benefits or risk paying a penalty. According to Congress’s budget experts, within 10 years, this bill will result in 7 million fewer Americans getting employer-provided health insurance. Corporate interests also like the huge tax cuts in the House bill, especially the $28 billion for prescription drug corporations and $145 billion for insurance companies.

Big company CEOs—the people who now earn 347 times more what front-line workers earn—are probably salivating over the huge personal tax cuts they will get from the Republican bill. One estimate is that those with million-dollar incomes will receive an average yearly tax cut of more than $50,000. The 400 highest-income households in the United States get an average tax cut of $7 million.

2. As many as 38 million workers will be blocked from saving for retirement at work. The Senate voted 50-49 last Wednesday to stop states from creating retirement savings programs for the 38 million working people whose employers do not offer any kind of retirement plan. The House already had voted to do this, and Trump is expected to sign off on it.

In the absence of meaningful action by the federal government, states have stepped in to address the growing retirement security crisis. But groups that carry water for Wall Street companies, like the Securities Industry and Financial Markets Association, have been actively lobbying Congress and Trump to stop states from helping these workers.

3. More than 100 million retirement investors may lose protections against conflicted investment advice. The House Financial Services Committee approved the so-called Financial CHOICE Act on a party-line vote last Thursday. It now goes to the full House of Representatives, and then to the Senate. In addition to gutting the Consumer Financial Protection Bureau that protects working people from abusive banking practices and ripping out many of the other financial reforms adopted after the 2008 financial crisis, this bill overturns key investor protections for people who have IRAs and 401(k)s. A massive coalition of Wall Street firms and their lobbying groups has been fighting to undo these retirement protections by any means possible.

About the Author: Shaun O’Brien is the Assistant Director for Health and Retirement in the AFL-CIO’s Policy Department, where he oversees development of the Federation’s policies related to Medicare, Medicaid, Social Security, and work-based health and retirement plans. Immediately prior to joining the AFL- CIO, he held several positions at AARP, including the Vice President for the My Money Portfolio and Senior Vice President for Economic Security. O’Brien holds a Bachelor of Arts degree from American University and a law degree from Cornell Law School.


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This week in the war on workers: Trump’s top attacks on workers … so far

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The Economic Policy Institute’s Perkins Project “tracks actions by the administration, Congress, and the courts that affect people’s wages and their rights at work,” and as we get to the end of Donald Trump’s first 100 days, they’ve provided a list of the top 10 things he and congressional Republicans have done to working people. Here’s a sample:

 

  1. Protecting Wall Street profits that siphon billions of dollars from retirement savers. At President Trump’s behest, the Department of Labor has delayed a rule requiring that financial professionals recommend retirement investment products that serve their clients’ best interests. The “fiduciary rule” aims to stop the losses savers incur when steered into products that earn advisers commissions and fees. The rule was supposed to go into effect April 10. For every seven days that the rule is delayed, retirement savers lose $431 million over the next 30 years. The 60-day delay will cost workers saving for retirement $3.7 billion over 30 years.
  2. Letting employers hide fatal injuries that happen on their watch. The Senate approved a resolution making it harder to hold employers accountable when they subject workers to dangerous conditions. The March 22 resolution blocks a rule requiring that employers keep accurate logs of workplace injuries and illnesses for five years. This time frame captures not just individual injuries but track records of unsafe conditions. President Trump said he would sign the resolution. If he does, employers can fail to maintain—or falsify—their injury and illness logs, making them less likely to suffer the consequences when workers are injured or killed. Blocking this rule also means that employers, OSHA, and workers cannot use what they learn from past mistakes to prevent future tragedies. If the rule is overturned, more workers will be injured, and responsible employers will be penalized.
  3. Allowing potentially billions of taxpayer dollars to go to private contractors who violate health and safety protections or fail to pay workers. The federal government pays contractors hundreds of billions of dollars every year to do everything from manufacturing military aircraft to serving food in our national parks. The Fair Pay and Safe Workplaces rule required that companies vying for these lucrative contracts disclose previous workplace violations, and that those violations be considered when awarding federal contracts. The rule was needed, as major federal contractors were found to be regularly engaging in illegal practices that harm workers financially and endanger their health and safety. On March 27, President Trump killed this rule by signing a congressional resolution blocking it. This will hurt workers and contractors who play by the rules, while benefitting only those contractors with records of cutting corners.

This article originally appeared at DailyKOS.com on April 22, 2017. Reprinted with permission.

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


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Republicans launch their crusade for elder poverty with repeal of automatic retirement accounts

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America is headed for a retirement crisis—too many people have no significant retirement savings and no pension and will have to rely almost entirely on Social Security benefits that Republicans are constantly trying to cut. You know that the Republican-controlled Congress isn’t going to do anything to fix it, so it’s fallen to cities, towns, and states to try to do something to prevent the disaster we can see approaching us in slow motion. But now, that same Republican-controlled Congress and Donald Trump have teamed up to roll back the ability of cities and towns to protect their future retirees, Bryce Covert reports:

… state and local governments have started setting up auto-IRA savings accounts for private sector workers. Unless a worker opted out, he would get automatically enrolled in such an account, allowing him to save some of his money for retirement.

But there was a question as to whether these accounts ran afoul of federal law. So in August of last year, President Obama finalized a rule that cleared the way for the establishment of these plans and clarified that they wouldn’t conflict with strict rules that apply to pension and retirement plans. That allowed cities and states to move forward.

Under the Congressional Review Act, Congress recently voted to undo Obama’s protections for cities and counties that set up these accounts. On Thursday, Trump put his signature on it, making it official.

States could be next, because why stop at screwing some workers when you could do so much more damage? Combine this with the eternal Republican plans to gut Social Security, and the United States could truly be a nation of senior citizens faced with the choice of working until they drop dead on the job or living on one can of cat food a day.

This article originally appeared at DailyKOS.com on April 14, 2017. Reprinted with permission.

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


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This week in the war on workers: Republicans take aim at retirement savings program

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The United States is heading for a major retirement crisis, with the shift from pensions to 401(k)s leaving at least half of households in danger of running short of money in retirement. There are a lot of possible solutions to that, and one of them doesn’t even involve employers paying their workers more:

What if people who wait tables, wash cars, take care of children, or perform other low-wage jobs for small businesses—which often don’t offer 401(k) savings plans—could have money taken out of every paycheck and deposited into a low-cost retirement savings account operated through the state government? Five states have enacted plans that are making this possible, and 28 states are at various stages of considering such plans. If all of these states did enact these laws, 63 million people could have access to retirement savings options.

This was the goal of the Obama administration, which put in place regulations to help states that wanted to provide retirement savings options. Though some states had set out on this path before, this new policy that made it easier and safer for states to offer these plans, paved the way for this positive development in the states. This was great news for millions of workers! Make it easy for people whose employers don’t offer retirement savings option to do the responsible thing: put away money every month toward their retirement in a way that limits the amount of their savings that is lost to fees and commissions. It helps people prepare for their old age. It chips away at a looming retirement crisis. What’s not to like?

You know where this is going, right? Of course you do. Republicans don’t like it because of this part: “in a way that limits the amount of their savings that is lost to fees and commissions.” Those fees and commissions don’t vanish into thin air, they go into the bank accounts of rich people. Plus, letting workers save their own money toward retirement creates a little extra work for employers, and there are a lot of crappy bosses out there who’d rather not bother, even if it means their workers will suffer in retirement. So the regulation helping states offer this retirement option is one more regulation being slashed by congressional Republicans.

This article originally appeared at DailyKOS.com on February 25, 2017. Reprinted with permission.

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


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