Yesterday a Walmart spokesman criticized the petition I’ve been circulating that asks Walmart (and McDonalds) to pay their employees at least $15 an hour.
Walmart’s spokesman told the Huffington Post that my petition fails to mention that Walmart is a major job creator and that it promotes some of its employees.
The spokesman is correct. In fact, Walmart is America’s biggest employer. And I’d be shocked if some of its employees weren’t promoted.
But the brute fact is Walmart’s typical employee is still paid less than $9 an hour.
To offer lousy jobs on such an extraordinary scale is not something to brag about. Indeed, the point of the petition — as well as the national movement to raise the minimum wage to $15 an hour — is to recognize that most people who work for big-box retailers like Walmart, as well as those who work in the fast-food industry, are adults. They are responsible for bringing home a significant share of their family’s income. A decent society requires they be paid enough to lift them and their families out of poverty.
When Martin Luther King, Jr., led the March to Washington for Jobs and Justice, fifty years ago this week, one of the objectives of that March was to raise the minimum wage to $2 an hour. $2 an hour in 1963, adjusted for inflation, comes to over $15 an hour in today’s dollars. Walmart doesn’t come close to the American dream.
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A few days ago I had breakfast with a man who had been one of my mentors in college, who participated in the struggle for civil rights in the 1960s and has devoted much of the rest of his life in pursuit of equal opportunity for minorities, the poor, women, gays, immigrants — and also for average hard-working people who have been beaten down by the economy. Now in his mid-80s, he’s still active.
I asked him if he thought America would ever achieve true equality of opportunity.
“Not without a fight,” he said. “Those who have wealth and power and privilege don’t want equal opportunity. It’s too threatening to them.They’ll pretend equal opportunity already exists, and that anyone who doesn’t make it in America must be lazy or stupid or otherwise undeserving.”
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“You’ve been fighting for social justice for over half a century. Are you discouraged?” ( Continue… )
The good news this Labor Day: Jobs are returning. The bad news this Labor Day: Most of them pay lousy wages and low if non-existent benefits.
The trend toward lousy wages began before the Great Recession. According to a new report from the Economic Policy Institute, weak wage growth between 2000 and 2007, combined with wage losses for most workers since then, means that the bottom 60 percent of working Americans are earning less now than thirteen years ago.
This is also part of the explanation for why the percent of Americans living below the poverty line has been increasing even as the economy has started to recover — from 12.3 percent in 2006 to around 14 percent this year. More than 35 million Americans now live below the poverty line.
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Many of them have jobs. The problem is these jobs just don’t pay enough to lift their families out of poverty.
But wait a minute. Over this same period, productivity has grown by nearly 25 percent. That means the typical American worker is now producing a quarter more output than he or she did in 2000.
So if wages have flattened or declined for the bottom 60 percent, yet productivity has increased, where have the gains gone? Mostly, to corporations and the very rich. ( Continue… )
Congress is in recess, but you’d hardly know it. This has been the most do-nothing, gridlocked Congress in decades. But the recess at least offers a pause in the ongoing partisan fighting that’s sure to resume in a few weeks.
It also offers an opportunity to step back and ask ourselves what’s really at stake.
A society — any society —- is defined as a set of mutual benefits and duties embodied most visibly in public institutions: public schools, public libraries, public transportation, public hospitals, public parks, public museums, public recreation, public universities, and so on.
Public institutions are supported by all taxpayers, and are available to all. If the tax system is progressive, those who are better off (and who, presumably, have benefitted from many of these same public institutions) help pay for everyone else. ( Continue… )
Congress began its summer recess last week and won’t reconvene until after Labor Day. You’d be forgiven for not noticing a difference. With just 15 bills signed into law so far this year, the 113th Congress is on pace to be the most unproductive since at least the 1940s.
But just because the legislature has ceased to function doesn’t mean our government has. Political decision making has moved to peripheral public entities, where power is exercised less transparently and accountability to voters is less direct. What we’re losing in the process isn’t government — it’s democracy.
Take the Federal Reserve. Absent any Congressional legislation to speak of — no short-term spending to increase job growth, no long-term plan to reduce the budget deficit — the nation’s central bank has been forced to do all the heavy lifting with the economy. The $85 billion of bonds it buys each month is now the main form of government stimulus to the economy as well as the linchpin of continued job growth. Congress’s inability to pass effective fiscal policy means that the Fed’s monetary policy, to keep long-term interest rates as low as possible, has become the only game in town for boosting private spending and investment.
But the strategy also poses serious risks: asset bubbles, if borrowers use the cheap money to speculate; bond collapses, if the Fed slows its bond buying too quickly and spooks the market; and inflation, if low interest rates cause buyers and sellers to expect prices to rise. It could also increase income inequality, by giving wealthy investors a cheap source of funds to expand their portfolios. Forcing the Fed to become the sole decision maker on the economy is also why the selection of a new Fed chairman has become so important — even more important than it ought to be.
Congress’s paralysis has also encouraged the Supreme Court to enter the political fray. Normally the judicial activism of recent years might be checked by Congressional action in response. But not now. Justice Anthony M. Kennedy’s opinion for the majority in the 2010 “Citizens United” case, which struck down limits on corporate campaign contributions, rested partly on the presumption that Congress would require corporations to disclose their political expenditures. But no bill requiring full disclosure has stood a chance of making it through the quagmire. ( Continue… )
Why is the nation more bitterly divided today than it’s been in eighty years? Why is there more anger, vituperation, and political polarization now than even during Joe McCarthy’s anti-communist witch hunts of the 1950s, the tempestuous struggle for civil rights in the 1960s, the divisive Vietnam war, or the Watergate scandal?
If anything, you’d think this would be an era of relative calm. The Soviet Union has disappeared and the Cold War is over. The Civil Rights struggle continues, but at least we now have a black middle class and even a black President. While the wars in Iraq and Afghanistan have been controversial, the all-volunteer army means young Americans aren’t being dragged off to war against their will. And although politicians continue to generate scandals, the transgressions don’t threaten the integrity of our government as did Watergate.
And yet, by almost every measure, Americans are angrier today. They’re more contemptuous of almost every major institution — government, business, the media. They’re more convinced the nation is on the wrong track. And they are far more polarized.
Political scientists say the gap between the median Republican voter and the median Democrat is wider today on a whole host of issues than it’s been since the 1920s.
Undoubedly, social media play a part — allowing people to pop off without bearing much responsibility for what they say. And most of us can cocoon within virtual or real communities whose members confirm all our biases and assumptions. ( Continue… )
Instead of spending August on the beach, corporate lobbyists are readying arguments for when Congress returns in September about why corporate taxes should be lowered.
But they’re lies. You need to know why so you can spread the truth.
Lie #1: U.S. corporate tax rates are higher than the tax rates of other big economies. Wrong. After deductions and tax credits, the average corporate tax rate in the U.S. is lower. According to the Congressional Research Service, the United States has an effective corporate tax rate of 27.1%, compared to an average of 27.7% in the other large economies of the world.
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Lie #2: U.S. corporations need lower taxes in order to make investments in new jobs. Wrong again. Corporations are sitting on almost $2 trillion of cash they don’t know what to do with. The 1000 largest U.S. corporations alone are hoarding almost $1 trillion.
Rather than investing in expansion, they’re buying back their own stocks or raising dividends. They have no economic incentive to expand unless or until consumers want to buy more, but consumer spending is pinched because the middle class keeps shrinking and the median wage, adjusted for inflation, keeps dropping. ( Continue… )
As we head toward renewed battles over the debt ceiling, sequester, and government funding, it’s important to understand why Republicans are disciplined and Democrats aren’t.
For the past five years of the Obama administration Republicans have marched in lockstep to oppose just about everything Obama and the Democrats have proposed. Yet the Democrats rarely march together. Recently, for example, 22 Democrats in the House joined every Republican in voting to delay the individual mandate in Obamacare.
When Republican leaders tell rank-and-file Republicans to call Obamacare’s cost controls “death panels," or to say the rich are “job creators," or the poor are “takers rather than makers," they all repeat the same words. (Frank Luntz, their message consultant, once said: “There’s a simple rule. You say it again, and you say it again and you say it again, and you say it again, and you say it again, and then again and again and again and again, and about the time that you’re absolutely sick of saying it is about the time that your target audience has heard it for the first time.")
Democrats never stick to the same message. They rarely even say the same thing the same way twice. In fact, their messages often conflict. ( Continue… )
One way to view Detroit’s bankruptcy — the largest bankruptcy of any American city — is as a failure of political negotiations over how financial sacrifices should be divided among the city’s creditors, city workers, and municipal retirees — requiring a court to decide instead. It could also be seen as the inevitable culmination of decades of union agreements offering unaffordable pension and health benefits to city workers.
But there’s a more basic story here, and it’s being replicated across America: Americans are segregating by income more than ever before. Forty years ago, most cities (including Detroit) had a mixture of wealthy, middle-class, and poor residents. Now, each income group tends to lives separately, in its own city — with its own tax bases and philanthropies that support, at one extreme, excellent schools, resplendent parks, rapid-response security, efficient transportation, and other first-rate services; or, at the opposite extreme, terrible schools, dilapidated parks, high crime, and third-rate services.
The geo-political divide has become so palpable that being wealthy in America today means not having to come across anyone who isn’t.
Detroit is a devastatingly poor, mostly black, increasingly abandoned island in the midst of a sea of comparative affluence that’s mostly white. Its suburbs are among the richest in the nation. Oakland County, for example, is the fourth wealthiest county in the United States, of counties with a million or more residents. Greater Detroit — which includes the suburbs — is among the nation’s top five financial centers, the top four centers of high-technology employment, and the second-biggest source of engineering and architectural talent. Not everyone is wealthy, to be sure, but the median household in the region earns close to $50,000 a year, and unemployment is no higher than the nation’s average. The median household in Birmingham, Michigan, just across the border that delineates the city of Detroit, earned more than $94,000 last year; in nearby Bloomfield Hills — still within the Detroit metropolitan area — the median was more than $150,000. ( Continue… )
Almost everyone knows CEO pay is out of control. It surged 16 percent at big companies last year, and the typical CEO raked in $15.1 million, according to the New York Times.
Meanwhile, the median wage continued to drop, adjusted for inflation.
What’s less well-known is that you and I and other taxpayers are subsidizing this sky-high executive compensation. That’s because corporations deduct it from their income taxes, causing the rest of us to pay more in taxes to make up the difference.
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This tax subsidy to corporate executives from the rest of us ought to be one of the first tax expenditures to go, when and if congress turns to reforming the tax code.
We almost got there twenty years ago. When he was campaigning for the presidency, Bill Clinton promised that if elected he’d end the deductibility of executive pay in excess of $1 million. ( Continue… )