workers

Celebrating Social Security: The Workers' Program

Daniel Marans — Tue, 06 Sep 2011 19:32:17 -0400

As we return to work after Labor Day weekend, it is important to recognize all that Social Security does for American workers. The best way to do that is to make sure workers know the facts about the program.

Social Security is America’s largest and most important pension, disability and life insurance program. Every American worker who contributes to Social Security earns the right to receive the program’s benefits when they retire, becomes disabled or die. In 2011 alone, Social Security is projected to provide benefits of $727.3 billion to 54 million Americans. An additional 157 million working Americans contribute to Social Security who will receive promised benefits for themselves and their families, in the event of disability, death or old age.

The payroll tax contributions that fund Social Security have been essential to the program’s strength over its 76 years of existence. They are what make Social Security a workers’ pension and insurance plan, rather than a government program. Instead of financing Social Security through taxes collected for the general fund, workers earn their benefits with deductions from every paycheck that are, in effect, insurance premiums. These contributions are held in trust, separate from the general budget, for the sole purpose of paying future benefits to workers who have paid into the program.

President Franklin Delano Roosevelt, who created Social Security in 1935, understood the importance of financing Social Security exclusively through workers’ contributions and the interest they earn. When pressed about the impact of payroll taxes on the economy, FDR said:

“We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics, they’re straight politics.”

Social Security is more important for American workers than ever. As the availability and value of private pension plans have declined precipitously, Social Security is, for many Americans, the only remaining stable source of retirement income. Defined benefit pension plans now cover only 20 percent of private sector workers, down nearly 100 percent from the 1980 level of 38 percent. As opposed to defined benefit pension plans, defined contribution plans, the most common of which is the 401(k), are subject to fluctuations in the market, and have, as a result, been devastated by the recent financial crisis. In 2008 alone, Americans’ private pension and 401(k) plans lost 37 percent of their value.

Still, Social Security remains under relentless attack from the same conservatives and Beltway elites who have helped make private sector pension plans disappear. Nowadays, Social Security’s detractors rely on claims that the program is broke to convince the public that major benefit cuts are inevitable. As Maya MacGuineas, President of the Committee for a Responsible Federal Budget—a center-right advocacy group funded by private equity billionaire Peter G. Peterson—put it: “We need some combination of benefit cuts and tax increases” to make Social Security solvent. MacGuineas' statement is not only untrue; it also artificially narrows debate about the program. If workers are warned by experts like MacGuineas that benefit cuts are “necessary,” they may withdraw their opposition in advance.

A great way to celebrate Labor Day is to learn the facts about Social Security, so workers are not forced into false choices about the future of the program. Contrary to MacGuineas’ claim, there any number of ways Social Security can pay all of its promised benefits through the next 75 years without cutting workers’ benefits at all. Given the tenuous state of retirement benefits in the private sector, and the modest nature of current benefits (they average just $13,000 a year), avoiding benefit cuts should be the highest priority.

Many Social Security advocates—and indeed, the vast majority of Americans—would like to scrap the cap on earnings subject to payroll taxes, so millionaires and billionaires pay into Social Security on all of their wages, not just the $106,800 they are currently taxed on. That alone could close more than 100 percent of the program’s shortfall.

In the spirit of Labor Day, though, it is worth considering a plan that takes a more orthodox, payroll tax centered-approach. In their “Northwest Plan,” Bruce Webb and Dale Coberly, Social Security experts and bloggers, propose implementing a trigger that would immediately increase payroll taxes if the program were unable to pay full benefits within ten years time. The provision, adopted in increments needed to make the program solvent over a ten-year period, would result in a payroll tax increase of about $2 a week for a median household. The trigger has the added advantage of linking revenue increases to the program’s financial projections, which vary greatly based on the state of the economy.

But, one might ask, wouldn’t scrapping the cap be best for workers, by making the rich pick up the tab? Not according to Webb and Coberly. The Northwest Plan is meant to preserve Social Security’s character as a worker-financed, worker-owned program. The payroll tax increase can be seen as an increase in workers’ insurance premiums, as opposed to a “tax increase” in the traditional sense. It enhances workers’ legally-sanctioned stake in the program, instead of shifting that stake on to the wealthy. Their plan follows FDR’s rationale that payroll taxes grant workers a “legal, moral and political right” to collect their Social Security benefits.

The tactic also gives workers more of a stake in forcing employers to share economic gains. If workers do not like paying a modestly larger amount into the program, then Webb advises them to “Demand better Real Wages.” Easier said than done, of course. But Webb’s advice is consistent with his philosophy of empowering workers to shape their own destinies, rather than relying on elites to change things for them.

By contrast, scrapping the cap entirely could dramatically increase Social Security’s role in the re-distribution of wealth, and undermine the program’s conservative ethos. Currently, Social Security strikes a delicate balance between equity and progressivity, using a flat tax rate and capped tax base to fund benefits that replace a larger share of pre-retirement earnings for low- and middle-income workers. One might argue that it has thrived in a conservative country like America, because it only re-distributes wealth modestly. While scrapping the cap has its merits, forcing rich people to subsidize the program more heavily could disrupt this delicate balance and undermine political support for the program.

Progressives understand this when it comes to means testing. They should keep it in mind when discussing scrapping the cap as well.

Views expressed are the author's own, and do not reflect the views of Social Security Works or the Strengthen Social Security Campaign.

Delta's Greed Helps Shut Down The FAA

Dave Johnson — Wed, 03 Aug 2011 15:32:13 -0400

You probably don’t know that another act of hostage-taking by Republicans is underway. They have shut down the Federal Aviation Administration (FAA) to help Delta Airlines in its battle to keep its workers from voting in a union. This is costing the government $200 million a week, more than 4,000 FAA employees have been furloughed, and as many as 87,000 construction workers and other contractors around the country are being laid off. The agency has been shut down for more than a week and so far the Republicans have refused to let it open before Congress leaves town for the summer. All this apparently so one company can keep employees who want a union from winning an election.

The FAA is the agency that regulates and overseas civil aviation. That is airports, airlines, pilots, employees, air traffic control, and other components of our aviation system. But the agency has been shut down. FAA inspectors and others are working without pay and paying for their own job-related travel. The shutdown is keeping the FAA from collecting federal taxes on airline tickets at a cost of $200 million in revenues each week even as the country struggles with deficits. Republicans said they don’t like deficits, but they clearly hate working people more – this shutdown adds $30 million a day, over $200 million a week to deficits.

A Shutdown Engineered For A Company

This shutdown of the FAA has occurred because of a form of “government shutdown” by Republicans, at the behest of Delta Airlines, over rules about unionization elections. Delta is in the middle of a fight to keep workers from being able to form a union. Delta wants the rules changes so a nonvoting worker, including one who might be sick, on vacation or otherwise absent from the workplace on election day, is counted as a “no” vote for unionization. Republicans inserted this anti-union language into the FAA funding reauthorization and are refusing to fund the agency unless Democrats agree to change these union election rules to help Delta.

Delta is apparently calling in favors to get this. According to Campaign Money Watch, in Is Delta Using Its Campaign Cash to Influence the FAA Debate?,

Delta's been spending money wisely to try to overturn the decision to let workers organize more easily. They spent $1.6 million on lobbying during the first half of 2011, according to the Center for Responsive Politics. (Over the past ten years they spent at least $32 million to influence Washington.) Their PAC has given $826,243 to members of Congress since 2000. Adding additional incentive for Republicans in Congress to stand with them, Richard Anderson, Delta's CEO, made a $5,000 contribution to the Senate Republican's campaign committee earlier this year — apparently his first one ever.

Not Delta's First Anti-Labor Problems

This is hardly the beginning of anti-labor activities by Delta’s management. There has been a string of actions against its workers to the point that the government has had to step in. WSJ: Delta Probed on Union Drive,

The National Mediation Board said Wednesday it will conduct a full-blown investigation into allegations by a flight attendants union that Delta Air Lines Inc. interfered in last year's fractious organizing drive at the world's second-largest airline by traffic.

Joan McCarter elaborates in Daily Kos in June, Delta Air's anti-union practices earns federal probe,

Delta isn't just a crappy airline for passengers, it's a crappy employer, too. At least it is if you can judge by the lengths it has gone to to prevent fairness in the workplace. Around the World Blog has some of the gory details of Delta's extreme anti-union activities:

Open advocacy against fair American elections: Delta issued a press release commending the news that Darrell Issa's deranged Committee on Oversight and Government Reform will investigate the NMB’s 2010 decision to conduct union elections for air/rail workers the same as all other types of American elections. … Unfortunately for Delta, the facts aren’t on their side -- there’s no reason to conduct NMB elections differently from every other form of election, union or non-union, in the nation. ….
Bumping paying customers…so Delta employees can lobby: Delta is so committed to its anti-union ideology that it offered its employees the chance to travel to Washington to lobby against fair union elections under a provision that may bump paying customers. …

It goes beyond, however, a general fight against the rights of airline and railroad employees to organize, to a very specific fiht among Delta employees to organize. The airline's fight against that union drive has made the airline a target for federal investigators.

"Delta is like the Scott Walker of airlines." Joe Sudbay sums up Delta management's attitude at AmericaBlog:

"Delta is like the Scott Walker of airlines. It wants to be known as anti-worker. And, of course, the GOPers in Congress are great allies in that quest. They'll join together to fight this investigation and undermine NMB."

Two Senators Weigh In On Delta And FAA Shutdown

In an NPR report, Reid Says FAA Shutdown Will Continue; Blames House, Delta Airlines, Senate Majority Leader Reid explains,

"It's not a battle over essential air service. It's a battle over Delta Airlines, who refuses to allow votes under the new rules that have been passed by the NLRB [National Labor Relations Board]." The issue, Reid says, is Delta's "non-union" stance. The bill to fund the FAA, as crafted by House Republicans, includes language that sets new rules for aviation workers' votes on labor representation.

Senator Rockeffeller, in a USA Today op-ed, Rural America needs Essential Air Service, talks about Delta's attack on workers rights,

Unfortunately, the Republican House is holding the FAAhostage and using the EAS program to distract from its acknowledged goal: overturning a workers' rights rule that makes sense and has been upheld in court.

This ugly backroom deal is the work of Delta Air Lines' anti-worker allies in the House. They want to overturn a decision of the National Mediation Board that allows airline and railroad workers to organize with their votes counted the regular way — yes and no — rather than by counting people who don't participate at all in the election.

Delta lost in court, and so it lobbied the Republican House leadership for help. That now involves blocking critical FAA legislation and attacking the EAS program, which creates jobs and economic opportunity in small communities by giving business access to travel.

Delta Greed Also Not Good For Customers

Delta's management provides us an example of what happens to a company that prioritizes greed over all else. We see a company that is not just bad for its workers, it is also bad for its customers. Here are examples.

Greed: When the FAA shutdown meant that taxes would not be collected some airlines let their customers keep the money. But not Delta's management -- they decided to keep that extra cash for themselves. Memphis Business Journal, Delta raises ticket prices amid FAA shutdown,

Air travelers are getting a break from federal taxes as the Federal Aviation Administration has partially shut down, but some airlines, including Delta Air Lines Inc. , have raised fares and nullified the tax break. ... While some airlines will allow customers to take advantage of the tax break, others, like Delta, have increased fares following the shutdown...

Greed: Amanda Terkel at Huffington Post: Delta Charges U.S. Troops Returning From Afghanistan $2,800 In Baggage Fees,

Delta Air Lines is facing intense criticism after charging 34 U.S. soldiers returning from Afghanistan $2,800 in baggage fees.

The incident came to light on Tuesday after a couple of the new-media savvy soldiers recorded a video about their ordeal and posted it on YouTube.

Greed: According to Delta Nightmares, a website devoted to describing Delta's bad customer service,

I’m apparently not the only one who thinks so. According to this article in the Wall Street Journal, Delta is having serious issues…ranking LAST among major carriers in customer service last year.

…among major airlines Delta finished with the highest rate of customer complaints filed with the Department of Transportation in the first nine months of last year, and was second-to-last in on-time arrivals and baggage handling through November. Delta also had the highest rate of canceled flights among major carriers in 2010, according to FlightStats.com.

Greed: Delta has earned the #65 place in BNet's Business Blunders of the Year for offering a $200 flight credit after losing a customer's dog.

"Delta told Josiah Paco had "escaped" and the best they could do is refund his $200.00 pet transportation fee, but only as a "credit" for future Delta travel. That doesn't do Josiah any good, as he's vowed to never fly Delta again"

Greed: just Google Delta Airlines bad customer service and see the thousands and thousands of results that pop up...

Part Of Larger Anti-Worker Campaign

This effort by Republicans in Congress is really just a part of a larger fight against workers' rights. As we have seen in several states, most notably Wisconsin, this is a coordinate, all-out attack by the larger corporations and their allies in the Republican Party. New Jersey, as just one more example, just passed, and Governor Christie signed an anti-union bill. In Ohio there is a campaign to repeal a law restricting collective bargaining rights. In Florida it is revealed that ALEC was behind the state's anti-union legislation efforts. In Missouri large protest turnouts beat back anti-union legislation.

FAA Still Shut Down

So the FAA is still shut down, possibly until September when the Congress returns. This is the Tea Party dream, government destroyed, financed and pushed by private companies, this time Delta Airlines. Delta is showing itself as a model of bad corporate behavior. Delta couldn't keep their workers from joining a union, so they try to get the laws rigged. Meanwhile the Republicans are showing themselves willing to contract out their legislative power to the highest bidders.

Delta Airlines is certainly not the only example of bad, greed-inspired behavior by corporate management these days -- far from it. But with the FAA shutdown over Delta's request for a rule to keep its workers from being able to unionize Delta is putting itself forward as a top example of bad corporate behavior.

March to Stop the Freeloaders

Leo Gerard — Fri, 01 Apr 2011 10:15:22 -0400

The nation’s greedy corporations and insatiable wealthy are fattening themselves on workers. There’s no trickle down. It’s the opposite; the rich have been sucking the economic lifeblood from the middle class for decades.

When reckless Wall Street banksters get taxpayer-funded bailouts, billionaires get tax breaks and gigantic corporations like GE and Bank of America pay absolutely no federal income taxes, they’re getting for free the very public services that enable them to make massive profits in this country – the courts, the roads, the trade regulators, the patent enforcement.

The middle class doesn’t get those big time special deals and loopholes. Workers pay their taxes. As a result, it’s workers footing the bill for the government services that enrich the rich. Greedy corporations, their CEOs and the right-wing politicians they buy with tens of millions in campaign cash are freeloaders.

It’s time workers stood up to the freeloaders. Join Monday’s We Are One rallies. These demonstrations across the country by religious groups, social justice organizations and labor unions will illustrate that the middle class is mad as hell and not going to take trickster economics anymore.

It’s time for greedy corporations and the insatiable rich to pay their fair share. It’s time to stop cuts to the government programs most treasured by and vital to the middle class and the vulnerable in this country – education, public transportation, Social Security. It’s time to stop right-wing attempts to terminate democratic rights like collective bargaining and voting without harassment. It’s time for the middle class to stop paying for everything and for the insatiable rich and greedy corporations to start sharing the sacrifice required to recover from the economic crisis caused by reckless gambling by Wall Street bankster corporations.

March for your rights Monday. March for the middle class facing record rates of foreclosure, unemployment, child poverty, and loss of opportunity as country club conservatives cut off college loans and Head Start. March for the right of college students to register and vote in the towns where they study. March for the right of workers to band together, elect representatives and bargain with employers for better pay and working conditions. March for the right of the people to insist that corporations pay at least the same rate of taxes as workers do. March to end tax breaks for the wealthiest one percent who have now acquired more wealth than all the workers in the bottom 90 percent.

Greedy corporations, the insatiable wealthy and their purchased politicians have for three decades skewed public policy to enrich themselves while pushing down wages and benefits for the middle class.

From 1947 to 1975, a time of strong unionization in the workforce, real wages of average workers increased with productivity. The 75 percent rise in productivity and the nearly matching rise in wages gave the United States the largest, most vibrant middle class in the history of the world.

Since 1978, productivity grew 86 percent, but compensation for workers grew only 37 percent, and if the cost of benefits, mostly uncontrolled health insurance increases, is removed, the real average hourly wage did not rise for 35 years, according to Alan S. Blinder, professor of economics and public affairs at Princeton University and a former vice chairman of the Federal Reserve.

Here’s how it works: The nation’s largest corporation, General Electric, earns tens of billions in profits from the labor of its workers but refuses to share the benefits with them. GE is expected to demand that its 15,000 unionized U.S. workers accept benefit cuts. So they’ll pay more for their retirement and health care and have less money to live and to pay taxes.

Meanwhile, the share of national income captured by the richest one percent rose from 8 percent in 1975 to 23.5 percent in 2005.

Under Dwight D. Eisenhower, the president in the 1950s, the nation’s richest paid an effective tax rate of 70 percent after loopholes. Today, it’s 16 percent – significantly lower than the 25 percent forked over through payroll deductions by individual workers earning between $34,500 and $83,600 a year.

That resulted from deliberate policy changes. Beginning with Ronald Reagan, country club conservatives cut taxes for the wealthy, while at the same time ending routine minimum wage increases and undermining the bargaining rights of labor.

The changes were made by increasingly wealthy politicians increasingly influenced by lobbyists. For example, 60 percent of the freshmen in the U.S. Senate and 40 percent in the U.S. House are millionaires. By contrast, only 1 percent of Americans are worth more than $1 million.

Compounding that is corporate influence, which worsened last year when the U.S. Supreme Court enabled corporations to donate unlimited money in secret. The upshot is corporations like General Electric, spending millions to lobby and paying zero in federal income taxes. GE spent $200 million to lobby for loopholes in the federal income tax code over the past decade, made $26 billion in American profits over the past five years, and not only paid absolutely no federal income taxes, but got itself a $4.1 billion rebate from the IRS.

That is far from an anomaly. Two out of every three U.S. corporations paid no federal income taxes from 1998 through 2005, according to a report by the Government Accountability Office. And the situation hasn’t improved since then. U.S. Sen. Bernie Sanders has written repeatedly about tax avoidance by the likes of Bank of America and Goldman Sachs, Wall Street banks that former President George W. Bush handed hundreds of billions in bail out dollars.

Bank of America got a $1.9 billion tax refund from the IRS last year, even though it made $4.4 billion. Goldman paid only 1.1 percent in federal income taxes on its $2.3 billion in profits. New York Times reporter David Kocieniewski wrote in his story about GE that such tax dodging by corporations has resulted in a significant decline in federal revenue from corporations – from 30 percent in the 1950s to 6.6 percent in 2009.

Tax avoidance is a virtuous cycle for greedy corporations and the wealthy. They pay less in taxes, then have more money to lobby politicians to lower their taxes. In fact, it’s gotten so bad that lawmakers are hiring lobbyists right from their K Street firms to write legislation. And Congress’ new right wingers are increasing this trend. Since they took office in January, nearly half of the 150 former lobbyists working in top policy jobs in Congress were hired.

For workers, however, it’s a vicious cycle. They’re forced to pay the taxes shirked by greedy corporations and the insatiable wealthy. And they’re forced to suffer service cut backs.

Right now, right wingers are trying to cut $51.5 billion from the federal budget – demanding elimination of programs essential to the middle class and poor such as subsidies for home heating for the impoverished. But if the wealthy paid their share, say hedge fund manager John Paulson who earned $2.4 million an hour in 2010 – then those cuts would be unnecessary because the federal government would have an extra $69.5 billion in revenue.

Forty-three years ago on April 4 Martin Luther King was assassinated after standing up for the right of public sector workers in Memphis, Tenn. to negotiate for better lives.

In his last speech, Rev. King said God had allowed him to go to the mountaintop where he’d looked over and seen the Promised Land. “I may not get there with you,” he cautioned, “But I want you to know tonight, that we, as a people will get to the Promised Land.”

Greedy corporations and the wealthy have made it to the mountain top. And they’re shoving American workers down the hillside to ensure the Promised Land is reserved only for the richest.

The promise of America democracy is equality. Equal rights, equal treatment under the law, equal opportunity. Freeloading by greedy corporations and the insatiable wealthy is denying those promises to the vast majority of citizens. Americans must unify and march to wrest back those rights and secure the American Dream for all.

Take a first step. Join one of the 600 We Are One demonstrations on April 4.

17 Rooms and What do You Get? Apparently, a Workforce in Rebellion

Dmitri Iglitzin — Thu, 31 Mar 2011 21:38:55 -0400

Statistics are one thing; people are another.

According to a 2009 report in the American Journal of Industrial Medicine, hotel employees, and especially housekeepers, have relatively higher rates of occupational injury, and sustain more severe injuries, than most other service workers. This was not a surprising conclusion. A 2005 survey of 941 hotel room cleaners found that during a twelve-month period, 75 percent experienced work-related pain, 83 percent report taking pain medication for discomfort due to work, and 62 percent reported work-related pain that forced them to visit a doctor.
There is a reason for this, of course. The work of hotel employees and housekeepers is not only tedious and badly compensated, it can be extremely physically demanding. Cleaning 15 rooms in eight hours, which is the standard in quality hotels, is hard, hard work. Doing it under pressure makes it worse.

And when a hotel decides to up its profits by increasing the number of rooms that need to be cleaned by each housekeeper each shift from 15 to 17, as both the Sheraton Anchorage and the Anchorage Hilton hotels did in 2009, the problem gets exponentially worse. As a housekeeping employee at the Sheraton explained in March of 2010:

When they increase the job, we have to do more work with our hours. We are not able to take our breaks, because we are just running, running, to try to finish our work, and that leads you to injure yourself. You bump your elbows and you bump your knees. When you are stripping the linen off the bed, you can easily hurt yourself badly. It happened to me three weeks ago. I was running, I smashed my fingers trying to close the closet. I smashed three fingers because of that.

A former housekeeper at the Hilton hotel, Blanca Garcia, explained:

I worked for 15 years at the hotel and never had an accident. Only last year [2009], with the workload now being 17 rooms -- I needed to hurry up, hurry up, and I slipped on the floor and my knee got broken.

Nationally, hotel employees have fought back against this type of speed-up through organizing, protests, and appeals for public support. They have often done so with the support of the hotel workers’ union, UNITE HERE! Employees of both the Sheraton and the Hilton hotels in Alaska have played active roles in this effort.

Like so many companies faced with requests and demands from their workers for better treatment, however, the Sheraton, in particular, refused to tolerate that dissent. According to the enforcement arm of the National Labor Relations Board (NLRB), the federal agency which oversees private sector labor relations, the Sheraton has, since approximately October of 2009, committed a whole host of unfair labor practices, including:

• unilaterally eliminating the workers’ health benefits plan;
• improperly installing and operating surveillance cameras;
• outsourcing workers’ jobs and duties;
• interrogating workers regarding their support for their union;
• threatening workers for supporting the union; and finally
• declaring that the Sheraton was now a “non-union” hotel and refusing to bargain further with their union.

The Sheraton also fired four hotel employees outright for handing out pro-union flyers in front of the hotel -- something the workers were clearly within their legal rights to do.

Not surprisingly, the NLRB found that these terminations were unlawful. And the hotel’s original decision to increase the number of rooms hotel employees are expected to clean each shift from 15 to 17? The NLRB says that that was unlawful, too.

But the wheels of justice in the world of employee rights grind exceedingly slowly, when they grind at all. The first legal charges were brought against the Sheraton by the NLRB on May 28, 2010, and nearly a year later, that prosecution has still not been concluded. While pressure from the NLRB forced the Sheraton to bring the four fired workers back to work in July of 2010, five months after the date of their termination, the Sheraton has not stopped, much less remedied, any of its other unlawful behavior.

Instead, the Sheraton has ramped up its attack on both its workers and their union. The Sheraton first sued the workers’ union for “defamation,” and for engaging in a boycott of the hotel, a boycott it claims has cost it in excess of $630,000. Then it sued the NLRB itself, asserting that the federal government, by finding merit in the workers’ many claims, had itself violated the law. That last lawsuit was dismissed outright by a federal judge in Anchorage, just five weeks after it was filed.

The slogan of the Alaska Cabaret, Hotel, Restaurant and Retailer's Association, the hotels’ trade group, is "Strength Through Unity.” So far, however, it is the housekeeping employees of the Sheraton, not the hotel itself or its corporate partners and allies, who have showed remarkable resilience in the face of almost insurmountable odds. As Ana Rodriguez, a union committee member and recently fired Sheraton housekeeping supervisor, stated:

We’re not asking for anything we don't deserve. We’re not asking for extra stuff, just to keep what we have.

It seems that when you are being required by your employer to clean 17 rooms in eight hours, day after day, standing up to your employer and asserting that you are a person deserving of a decent wage, benefits, and working conditions, and not merely a statistic in the annals of journals of occupational health, is a necessity, not a choice.

Dmitri Iglitzin is a partner with the firm of Schwerin Campbell Barnard Iglitzin & Lavitt, LLP, in Seattle, Washington, a frequent commentator on labor matters, and legal counsel to UNITE HERE Local 878, which represents workers at the Sheraton Anchorage and Anchorage Hilton hotels.

Student Loan Reform, Good for Workers Too

Armand Biroonak — Wed, 17 Feb 2010 09:25:54 -0500

As Congress returns to Washington, the Campaign for America’s Future calls on the Senate to finish what the House started, and pass Student Loan reform to end billion dollar bank subsidies and invest in students. Passage of the Student Aid and Fiscal Responsibility Act (SAFRA) will not only benefit students though, the legislation includes key provisions to help workers too. SAFRA will provide billions to community colleges and create worker training programs that bring together business, labor and community organizations –allowing workers to retool or gain skills in preparation for the jobs of today and tomorrow.

Click here to easily contact your Senator, urging them to pass Student Loan reform NOW!

Worker training has always been critical to the success of American workers’ and America’s industries. However, now more than ever, record unemployment and shifting industry demands are making skills training extremely important for workers to access. The need to invest in worker training programs is emphasized in CAF’s recent report, "The Bridge To The New Economy: Worker Training Fills The Gap" that highlights how a skills gap in the U.S. harms economic recovery because too few workers have the skills –particularly middle skills –needed to match the jobs available today and the growing industries of tomorrow. Middle skills require not a bachelor’s degree, but some form of post-secondary certification or associate’s degree. Industries with emerging middle skill jobs include the health care, information technology, green energy and advanced manufacturing sectors.

Skills training are best gained, though not exclusively, at our nation’s 1,200 community colleges. In fact, the number of Americans attending community colleges for various skills and certification has been on the rise. Between 1987 and 2007, the percentage of Americans granted post-secondary certificates and associate’s degrees at community colleges more than doubled. SAFRA addresses this demand with sorely needed funding giving community colleges a big boost and by expanding worker training partnerships between community colleges and the private sector. Partnerships are particularly important because they provide a career pathway for workers, matching learned skills to a job in hand after training.

Americans know that greater skills are needed to compete and land a job in today’s tough market. According to a December 2009 CBS News poll, when asked “Compared to 20 years ago, do you think the types of jobs now available in the U.S. require different backgrounds and skills than they used to 20 years ago, or do the jobs available now require about the same backgrounds and skills?", Americans responded overwhelming that the demands on the labor market have indeed changed:

Different: 89%
About the Same: 10%

And employers equally report trouble filling positions –despite a record number of applicants –because of a gap between the available skills of applicants and the required skills of an opening. According to a July 2009 survey by Business Roundtable, more than 60 percent of employers reported that candidates lack the skills to fill available jobs. More specifically, the employment research group Manpower Inc. found that the top ten occupations with the greatest skill shortages for 2009 include middle skill occupations such as nursing, skilled trades (for example, electricians and welders), and machinists.

However, the investment in skills training that is demanded by both workers and businesses is in jeopardy. Student loan reform is currently stalled in the Senate as the powerful bank lobby tries to kill legislation that would end their $87 billion of subsidies. According to the New York Times, lenders such as Sallie Mae have lobbied Congress hard so far this year, spending millions to win over Congress and defeat SAFRA’s reform. But let’s not allow this momentous reform to die on the Senate floor. Click on this link to tell your Senator to pass Student Loan reform, not only on behalf of students, but workers too.

Danger: Falling Middle Class

Tula Connell — Fri, 05 Feb 2010 09:06:52 -0500

Jack Cafferty at CNN this week asked viewers one of his seemingly routine questions. But the responses to: "How has definition of 'middle-class American' changed?" reveal a cataclysmic shift in our nation's economic identity.

Gary from El Centro, Calif., summed up the vast majority of the nearly 200 responses when he replied:

You should ask this question of the three or four people in the country still remaining in the middle class.

The comments reflect more than the run-of-the-mill griping about taxes or middle-aged discontent. They demonstrate a visceral understanding of the deep forces underlying the dramatic change that in recent decades has eroded the solid financial footing of America's working families—America's middle class.

In short, the American public knows what most lawmakers in Washington and policymakers around the country have yet to figure out: The nation is losing its middle-class backbone and bifurcating into a have/have not country.

As Karen from Idaho Falls writes on Cafferty's site:

In my world, there is no middle class–only the very rich, the rich, the poor, and the very poor. Most of us are hanging on to being "poor" by our fingernails and hoping that we won't join the ever growing "very poor" class. Somewhere along the line, "middle class" disappeared.

The not-so-Great Recession is just the latest and loudest part of the long decline of the middle class. From the end of World War II to the early 1970s, wages grew along with productivity. But since then, wages have been stagnant or declining—while productivity skyrocketed. The decline in a family's earning power was offset by the entrance of vast numbers of women in the labor market—and then by wage-earners holding multiple jobs. By the late 1990s, debt—from second mortgages or credit cards—kept the middle class afloat. And now what is revealed is a middle class held together by nothing more than string.

One of the most consequential but least recognized aspects of the current economic disaster is the growing length of time workers are without jobs. In December, the average jobless worker had been unemployed for 29.1 weeks. In contrast, when the recession began in 2007, the average unemployed person had been out of work for 16.5 weeks.

At Economix blog, Catherine Rampell points out in an tellingly titled post, "A Growing Underclass," that the longer unemployed workers stay out of work, the less likely they may be to find work.

First, their skills may deteriorate or become obsolete—especially if they are in a dynamically changing industry like high technology.

Second, the stigma—both internal and external—of their unemployment grows. Studies have linked job loss to declines in self-worth and self-esteem, meaning these people will probably make less compelling job candidates.

So, even if there were jobs available—there are now more than six unemployed workers for every one job—getting one becomes harder and harder the longer you're out of work. Jobs are so few, in fact, even a weekly columnist at Forbes had this to say:

For many, many Americans there are no jobs and few prospects. For them the Great Recession is not a cute aphorism but a major cataclysm.

Long-term joblessness is one more nail in the middle class coffin. As Working-Class Perspectives describes it:

Unlike in past business cycles, the middle class has not been able to recover so far, despite increases in productivity and stock prices. In “America Without a Middle Class,” Elizabeth Warren documents how the de facto unemployment rate, credit debt, “underwater” mortgages, increased use of food stamps, personal bankruptcies, and the loss of pensions and health care have all dramatically increased. Middle-class households have depleted their savings and are increasingly accruing debt to pay for college, health care, and other expenses.

Some experts believe that the decline in jobs will only continue. For example, Alexandra Levit predicts significant losses in a number of key industries between 2008 and 2018: semiconductor manufacturing (33.7 percent), apparel manufacturing (57 percent), newspaper publishers (24.8 percent)….Corporations are moving many of these jobs offshore or replacing them with technology rather than paying middle-class wages and benefits. The economists are right that new jobs are being created in place of these. But as Jack Metzgar discussed last week, most of the new jobs offer even lower wages and benefits and require less education.

Jobs are offshored while the jobs that remain in the United States are low-wage, with little affordable health care or retirement options. Meanwhile, the smooth of face and soft of hand financial wizards who turn their noses up at the industrial manufacturing sector fail to realize that when the United States loses its ability to make things, it also loses the research and development power that fueled the nation to greatness. And it loses something a lot more. Louis Uchitelle interviews Sen. Sherrod Brown (D-Ohio) about the humiliation of building a new World Trade Center with no glass made in the United States:

“Imagine China,” he said in an interview, “building a huge structure intended to be an important national symbol and importing glass from the United States to build it. There is no way the Chinese would do that.”

And a low-wage job nation fuels income inequality. This from a stunning report by economist John Schmit at the Center for Economic and Policy Research:

From a peak just before the 1929 stock market crash through the early 1950s, wage and income inequality, broadly measured, were declining. From the early 1950s through the late 1970s, inequality was flat, or even falling slightly. Since the late 1970s, however, inequality has skyrocketed, climbing back to levels last seen in the 1920s. In 1979, for example, the top one percent of all U.S. taxpayers received about 8 percent of national income; by 2007, the top one percent received over 18 percent. If we include income from capital gains in the calculation, the increase in inequality is even sharper, with the top one percent capturing 10 percent of all income in 1979, but over 23 percent in 2007.

Back at Cafferty's site, Chad from Los Angeles knows why:

The middle class has turned into the "peasant class." We have been taken over by a few wealthy people who control our politicians and government. We have become an Aristocracy. Except the ones in control are not royalty, they are businessmen hiding behind a cloak of deception that is Corporate America.

In the short term, critical steps must be taken for immediate relief. The first is getting the Senate to extend unemployment insurance (UI) for the long-term unemployed. As usual, the House already has acted, extending UI in December, while senators dither. (Click here to tell your lawmakers it’s time to act.) Extending UI is part of the jobs initiative the AFL-CIO is pushing for immediate relief for jobless workers.

But before the current crisis fades, the nation must begin to reverse the more than 40-year trend in which the gap widens between rich and poor and the middle class falls out of the bottom.

Silas from Boston—a city not unfamiliar with fomenting revolutions—offers an intriguing insight:

We've allowed the "upper" class to become too big to fail. As a result, the middle class is an endangered species which has to bail out the class that got us into this mess to begin with. This is how the French Revolution started.

This is a cross-post from the Firedoglake blog.

R.I.P., Circuit City

Dmitri Iglitzin — Thu, 08 Jan 2009 02:11:54 -0500

On November 10, 2008, Circuit City, the nation’s second-biggest electronics retailer, filed for bankruptcy. It’s going to have a lot of company in bankruptcy court. More than a dozen U.S. retailers filed for bankruptcy in 2008, including Linens ‘n Things and Sharper Image. Already in 2009, KBtoys.com has followed suit, and more such filings are expected following what may have been the worst holiday-shopping season in 40 years.

What makes Circuit City’s collapse worthy of some special note, however, however, is the fact that this company, en route to its financial meltdown, tried to balance its books at the expense of its workers, a tactic that other companies may yet be tempted to follow, despite Circuit City's evident lack of success.

In March of 2007, Circuit City decided to fire approximately 3400 senior store employees who were making, on average, about $15 per hour. Some of these workers were replaced by new hires, while others were actually invited to return to work at $10.22 per hour. These layoffs represented approximately 8% of the in-store work force, or on average, 5 staff members per store.

The job cuts were "one of the most brazen examples of corporate America run amuck,'' said Greg Tarpinian, executive director of Change to Win, a coalition of seven international unions representing about 6 million workers. "It's workers as disposable commodities, put in and put out based on whatever happens to the stock price.''

Not surprisingly, this heartless move not only damaged Circuit City’s reputation, it failed to provide any lasting benefit to the company’s bottom line. By replacing its most experienced salespeople, Circuit City lost effectiveness in both sales and customer services. As a result, Circuit City's customer satisfaction rating has steadily declined, dropping 5.5% overall since 2003, and it now trails competitors Best Buy, Costco, and Wal-Mart, the first two by a considerable margin.

Nor did Circuit City’s stock price benefit. It dropped from over $19 per share on the date of the layoffs to $4 per share a year later, and it had dropped all the way to a quarter before the company filed for bankruptcy.

None of this stopped Circuit City from generously rewarding its management team for their lack of success, of course. In 2006, according to Bloomberg.com, then-Chief Executive Officer Philip J. Schoonover (he was forced out last September) raked in $8,520,000 in total compensation. In addition, at around the same time as the layoffs, the company's board approved "retention awards" of $1 million for each of its 3 executive vice presidents and $600,000 for each of its 10 senior vice presidents. Circuit City said the awards were intended "to ensure the stability of the company's leadership team by providing an incentive" for the officers to stay.

In court documents, Chief Financial Officer Bruce H. Besanko said that three factors led to Circuit City’s bankruptcy filing: erosion of vendor confidence, decreased liquidity and the global economic crisis. Maybe. But he should have added one more factor: a fundamental lack of respect by Circuit City’s management for the company’s own workers, who were the one company resource that might have been able to restore its tarnished reputation and save it from failure.

Circuit City is still selling gift cards, and it is promising to do its best to honor those cards if customers actually try to use them. Had Circuit City been willing to match its own workers' level of commitment, instead of kicking those workers to the curb as soon as times got hard, perhaps its promises would not ring quite so hollow.

R.I.P., Circuit City

Dmitri Iglitzin — Thu, 08 Jan 2009 02:10:51 -0500

Remembering Studs Terkel

Tula Connell — Mon, 03 Nov 2008 10:22:15 -0500

What bitter irony. Studs Terkel, who gave voice to working people throughout his life, passed away yesterday, just days before a potentially historic presidential election. Should Sen. Barack Obama win on Tuesday, his victory would be a sweet vindication for Terkel, whose affinity for America's workers would be reflected in the policies of an Obama administration.

Terkel, 96, has been renowned for his compilations of oral interviews with famous and mostly not-so-famous Americans. He has talked with thousands of people about their experiences on the job, serving their country in World War II, their perceptions of race and most recently, the challenges of growing old and facing death. One of his most famous books is Working, in which more than 100 Americans share their hopes, dreams and daily struggles on the job.

In April 2006, Terkel received the Lifetime Achievement award from the workers' advocacy organization, American Rights at Work. After accepting the award, Terkel said:

What brings workers together can be a belief, a hope of improving the climate and community at work--the spaces where so many of us spend so much of our lives. Respect on the job and a voice at the workplace shouldn't be something Americans have to work overtime to achieve.

Born Louis Terkel, he grew up in the 1920s and 1930s in an environment filled with workers, union organizers and other progressives who gathered in the lobby of his parents' Chicago rooming house. Starting his career as an actor, disc jockey and radio and television personality, Terkel ultimately turned to documenting oral interviews in a series of books. In Working: People Talk About What They Do All Day and How They Feel About What They Do, Terkel elicited first-hand experiences of workers as varied as bus driver and strip miner, policeman and film critic. Blacklisted in the 1950s by the House Committee on Un-American Activities, Terkel went on to win a Pulitzer Prize in 1985 and a National Humanities Medal from President Bill Clinton in 1997.

Terkel, who has been called a "guerilla journalist" and a man "whose name is synonymous with Labor Day," sprinkles his conversation with references to the ancient Greek mathematician Archimedes and American revolutionary Thomas Paine--yet has the unique ability to engage people in a way that draws forth the hopes, dreams and heartfelt experiences of everyday Americans.

In July 2005, I was honored to interview Terkel, and in his inimitable style, his conversation ranged from erudite quotes from the classics to conversations heard at his local bus stop. In remembering Terkel, there's no better way than to hear him in his own words. Below is the excerpt from that July 2005 interview.

"The thing that's so ironic, is we are stuck with what I call national Alzheimer's disease. The general American public, through no fault of its own, but through the media--which is laughingly called, absurdly called, obscenely called--liberal media, which is a joke, of course. But the point is that because of that, day after day after day, putting down of labor organizations, or not mentioning them led to the children not knowing a thing about it.

How did the eight-hour day come into being? It began in Chicago and four guys got hanged for it--the Haymarket affair in 1886. What were they fighting for? The eight-hour day.

There's no knowledge what the labor movement did for the lives of people. Social Security came out of the New Deal, and the minimum wage idea, and the idea of national health, these all came out of [labor]. And that's all being dismantled by what we have now. And so part of it is not knowing the past. No past, therefore there is no present and no future.

What was the first thing Ronald Reagan did as president of the United States? In 1981, he broke the air controller's strike. You know what they were striking about? It wasn't about pay. It was about R and R, rest and recreation. So the issue was passenger safety, right? And Ronald Reagan said, 'No,' and four out of five Americans applauded.

You start wondering, 'Wait a minute. Are we a necrophiliac people?' And you start thinking some more. 'We're the only industrialized country that still has the death penalty, right? We're the only industrialized country that does not have national health insurance.' So one is death, and the other is life. And so you start thinking, 'My God, have we become so perverse?

If so, then all my books are junk? Because my books depended on the sense of decency of ordinary Americans and their native intelligence and it's under assault today as never before.

[Americans' sense of decency and native intelligence are] there, but the information has been siphoned through--we know what it's siphoned through: Fox News, Rupert Murdoch and Rush Limbaugh. And thus we have a certain kind of news filter to it. Right? It becomes entertainment, it becomes banality, it becomes nothing. And there's no past. The big thing is to revivify in one way or another the past and to show how we came to be.

So that's part of the problem facing labor, to reacquaint these people with what happened. The new members are fresh and they have grievances and we've got to hit that and reach as many as possible--caregivers and…maids and get all the people who never thought of organizing, organized. And that's what the oral histories I write are all about, I hope--to recapture our history. And I think we can do it--provided we…stick together.

Whatever split there is has to be healed--immediately. Because we agree on the big thing. Basically, it has to be under one big tent. I like the phrase 'under one tent.' And so, that's pretty much the ticket."

This is a cross-post from the AFL-CIO Now blog.

Countries with Lax Labor Regulations, Bolsters Trade Deficit

Armand Biroonak — Tue, 07 Oct 2008 00:00:00 -0400

Increased trade with countries who have few or no worker protections has resulted in a U.S. trade deficit that is $123 billion more than it would be if we traded with countries of strong labor standards.