Archive for Economy
Thinking about the Keystone XL pipeline. Perhaps you’ve seen a similar scenario before. It could be General Motors or a new real estate development or Goldman Sachs or infrastructure privatization or, really, any other business with political clout. The company insists that the public financially back the venture, or pass legislation to allow it, or amend existing rules (others must abide by) to permit it, or subsidize it with public services, land, or tax breaks, or bail out its failure.
The public – voters – object, citing a multitude of reasons. Good reasons, maybe. Bad reasons, maybe. It’s our community and our right to whatever we damned well please reasons. Maybe We the People simply don’t like your looks or the smell of the deal.
Executives behind the proposal paint objectors as Luddites or communists or NIMBYs or tree huggers or all of the above. How dare citizens stand in the way of unbridled progress, profit, Manifest Destiny? How dare they impede job creators? (“Stand aside, everyone! I take LARGE STEPS!”) Why, if the rabble don’t accede to their wishes and soon, the project will be stillborn. The business model won’t work! Profits and jobs and tax revenues will be lost.
Exaggeration? Of course. And so familiar.
Self-described risk-takers think it impertinent of mortals to question their assumptions, but We the People should anyway, especially when their plans impact our communities. Here is a question rarely asked and less rarely answered:
“How is the success of your business model our problem?”
File away for future use.
(Cross-posted from Hullabaloo.)
This is getting to be a Buffalo Springfield kind of thing, ain’t it?
Fast food workers in at least 150 cities nationwide will walk off the job on Dec. 4, demanding an industry-wide base wage of $15 per hour and the right to form a union. Workers unanimously voted on the date for the new strike during a Nov. 25 conference call, held shortly before the second anniversary of the movement’s first strike.
The first of the recent fast food strikes took place on Nov. 29, 2012, in New York City. Two hundred workers from various fast food restaurants around the city participated in that strike, making it the largest work stoppage to ever hit the fast food industry. Since then, the size of the movement has ballooned several times over: With the backing of the powerful service sector labor union SEIU, the campaign has come to include thousands of workers in the U.S.
Laura Clawson for Daily Kos Labor:
The fast food strikes and other actions by low-wage workers have been a major source of momentum behind increasing the minimum wage. No one was talking about $15 an hour until fast food workers started fighting for it in late 2012. The Democratic proposal of a $10.10 federal minimum was generally portrayed in the media as a reach, the grounds for a compromise to something lower. $15 sounded impossible, yet now two major American cities—Seattle and San Francisco—are on their way there, while Chicago is about to pass a $13 an hour minimum wage, Oakland has approved a $12.25 wage, Washington, DC, and neighboring counties in Maryland are on their way to $11.50, and Massachusetts is going to $11. Doubtless some or all of these cities and states would have done something about the minimum wage without this level of worker organizing, but there’s no way we’d be seeing so many places going above $10.10.
Chicago passed its $13 an hour measure yesterday.
Rev. William Barber, president of the North Carolina NAACP and Moral Mondays organizer, spoke on the conference call, saying, “The battle for fair wages is as critical as the battle that young people waged in the 1960s when they came into the sit-in movement.”
The particulars of these events are not as important as what they represent: a growing sense of frustration with economic and social conditions. These actions are symbolic, intended to break through the “everybody knows” noise generated by the mass media.
Millions of people make $8 to $10 an hour working as cashiers or in restaurants, or providing elder or child care – a far cry from a living wage. Despite working hard, many of these people live in poverty or on the edge of poverty.
This isn’t what America is about, and it can’t be reconciled with political rhetoric that says if you work hard and play by the rules, you will succeed in the United States.
In a season when the western world empathizes with Bob Cratchit’s struggles – with no heat for his office – to feed his fictional family, real families working for miserly wages and hours must choose between buying food and heating their homes. Food banks are sorely taxed. With every succeeding year, Dickens’ morality tale looks more and more like a quintessentially American story.
(Cross-posted from Hullabaloo.)
Traditional anti-consumerism boycotts of Black Friday have company this year.
In the wake of the grand jury decision not to charge Officer Darren Wilson in the killing of 18-year-old Michael Brown, activists are encouraging black consumers to turn to economic activism and boycott the busiest shopping day of the year.
Under the title “No Justice, No Profit,” the boycott aims to capitalize on the purchasing power of the black community, which Al Jazeera points out is about $1 trillion, and prove, in a language businesses will understand—money—that injustice doesn’t come without consequence.
Dacia Polk of the Justice for Michael Brown Leadership Coalition explained the boycott to St. Louis Public Radio, saying:
“There will be no business as usual while those who are supposed to protect and serve us,” she said. “Until this nation begins to place value on black lives, there will be no value placed on this business because black lives matter.”
Protesters are urged to avoid large retailers and to support instead local, black-owned businesses. Hashtags: #BoycottBlackFriday, #BlackOutBlackFriday #HandsUpDontSpend, #NotOneDime, and #BrownFriday.
Walmart, the crown jewel of the low-wage economy, is still in the running for “worst corporation in the world.” Again this year, the home of low, low wages faces Thanksgiving and Black Friday protests from community activists and its own employees — I’m sorry Associates:
OUR Walmart first burst onto the scene two years ago, when it used Black Friday, the biggest shopping day of the year, to launch an unprecedented, nationwide strike against Walmart. The group originally demanded that Walmart pay all employees a base salary of at least $25,000 per year, but has since joined with striking fast food workers in demanding at least $15 per hour.
As with OUR Walmart’s first major action in 2012, this year’s Black Friday protests will not be a typical strike. Many of those picketing Walmart — perhaps even most — will be outside supporters of the OUR Walmart campaign, not store employees themselves. Those employees who do walk off the job will likely do so for just one day. Yet OUR Walmart has said that their prior work stoppages are legally protected strikes, and the National Labor Relations Board (NLRB) has agreed. Strikes over wages and working conditions, or over an alleged ULP (unfair labor practice), such as illegally retaliating against workers, are protected by federal law.
Besides fringe benefits like missing Thanksgiving and Christmas with families, Associates also miss meals:
This year’s protests by Walmart workers will kick off on Thanksgiving with a 24-hour fast by 12 protesters. The fast, which is protesting the hunger suffered by some Walmart workers who can’t afford food, will be staged outside a Los Angeles store.
One of the workers participating in the fast is Richard Reynoso, an overnight stocker at the Duarte, California store. Reynoso is one of those workers who cannot afford to purchase three meals a day. As a result, he only eats once a day on his lunch break.
“Sometimes all I have money for is a can of tuna and crackers,” he said.
But progressives need to be careful. Even as living wage advocates demand higher wages from big-box retailers, such protests can pit them against the very communities they hope to help. Those everyday low prices enable the Waltons’ clientele in poorer neighborhoods to stretch their limited incomes. Perhaps a new slogan?
Walmart: We make poor affordable
(Cross-posted from Hullabaloo.)
Meet your new union reps: the statehouse and City Hall.
San Francisco’s new law, which its Board of Supervisors passed Tuesday by unanimous vote, will require any “formula retailer” (retail chain) with 20 or more locations worldwide that employs 20 or more people within the city to provide two weeks’ advance notice for any change in a worker’s schedule. An employer that alters working hours without two weeks’ notice — or fails to notify workers two weeks ahead of time that their schedules won’t change — will be required to provide additional “predictability pay.“ Property service contractors that provide janitorial or security services for these retailers will also need to abide by the new rule.
What’s worse, these subversive notions have a way of spreading east from the Left Coast like viruses. Call out the dragoons.
Speaking of predictability, the San Francisco Chamber of Commerce is predictably miffed about the “Retail Workers Bill of Rights.” For struggling hourly workers, taking classes, caring for families, and raising children (and managing day care logistics) is something The Economy expects you to fit in between work shifts at multiple, part-time, low-paying, no-benefits service jobs where shift schedules vary a lot. But that’s just the way it is and the way The Economy likes it. With labor unions weakened and workers disempowered, setting working conditions once governed by collective bargaining agreements now falls to local Democrats. That is, if you can find any that aren’t Republican lite.
And go figure, labor-friendly measures such as the Retail Workers Bill of Rights are popular. HuffPost:
With Congressional Republicans opposing a minimum wage hike and other legislation aimed at low-wage work, labor unions and their progressive allies have found much more success on the local level. Despite the drubbing that Democrats took in the midterm elections earlier this month, binding ballot initiatives on the minimum wage passed easily in four red states. A measure that will require many employers to provide their workers with paid sick days also passed in Massachusetts.
Increased unpredictability in work schedules is driven by technology. When store foot traffic had to be measured manually and work schedules were typed out, employers found it cumbersome to alter work schedules too frequently. But just as computers created vast new producer efficiencies through just-in-time store inventories, so, too, did they create vast new staffing efficiencies through just-in-time work scheduling. Trouble is, getting moved around at the click of a mouse is more disruptive to human beings than it is to refrigerators and automobiles.
“Efficiency” is like “shareholder value” that way. When they start hearing it, flesh-and-blood consumable resources better update their resumes, stock up on antacid, and learn to get by with even less sleep.
Earlier this year, 32-year-old Maria Fernandes of Newark, NJ died of asphyxiation while catnapping in her car between shifts of her four part-time jobs. The Economy did not attend her funeral.
(Cross-posted from Hullabaloo.)
We’ll spare you the easy Uber jokes and get right to it. The ridesharing service is not having a good week after a couple of Buzzfeed articles hit social media. It seems Uber executives might like to surveil both customers and critics. The WaPo has this:
The controversy stemmed from remarks by Uber Senior Vice President Emil Michael on Friday night as he spoke of his desire to spend $1 million to dig up information on “your personal lives, your families,” referring to journalists who write critically about the company, according to a report published Monday night by Buzzfeed. The same story said a different Uber executive once had examined the private travel records of a Buzzfeed reporter during an e-mail exchange about an article without seeking permission to access the data.
That combination of vindictiveness and willingness to tap into user information provoked outrage Tuesday on social-media sites, spawning the hashtag “#ubergate” on Twitter. Critics recounted a series of Uber privacy missteps, including a 2012 blog post in which a company official analyzed anonymous ridership data in Washington and several other cities in an attempt to determine the frequency of overnight sexual liaisons by customers — which Uber dubbed “Rides of Glory.”
Our daily interaction with tech companies means “we have never been more extortable,” according Chris Hoofnagle, a UC Berkeley law professor specializing in online privacy.
Just because you don’t hear the term “free-market fundamentalism” much these days doesn’t mean the faith has gone away. More on that in a minute.
Der Spiegel looks at The Zombie System: How Capitalism Has Gone Off the Rails. The wizards of finance are not the choir boys that prove the moral superiority of capitalism, as analyst Mike Mayo believed when he entered the business. Instead, writes Michael Sauga, Mayo found “the glittering facades of the American financial industry concealed an abyss of lies and corruption.”
Ironically, some the most blessed(?) beneficiaries of the corruption, global financial and political leaders, now say they want to fix capitalism, make it more inclusive:
It isn’t necessary, of course, to attend the London conference on “inclusive capitalism” to realize that industrialized countries have a problem. When the Berlin Wall came down 25 years ago, the West’s liberal economic and social order seemed on the verge of an unstoppable march of triumph. Communism had failed, politicians worldwide were singing the praises of deregulated markets and US political scientist Francis Fukuyama was invoking the “end of history.”
Today, no one talks anymore about the beneficial effects of unimpeded capital movement. Today’s issue is “secular stagnation,” as former US Treasury Secretary Larry Summers puts it. The American economy isn’t growing even half as quickly as did in the 1990s. Japan has become the sick man of Asia. And Europe is sinking into a recession that has begun to slow down the German export machine and threaten prosperity.
JPMorgan Chase got its computers hacked this summer, compromising personal information from 76 million households. Like oil spills, the size of these breaches always seems to grow after the early low-ball estimates from company spokes-flacks. And nobody seems to have a statement from current chairman, president, and chief executive officer of JPMorgan Chase, Jamie Dimon. The NY Times reports:
Operating overseas, the hackers gained access to the names, addresses, phone numbers and emails of JPMorgan account holders. In its regulatory filing on Thursday, JPMorgan said that there was no evidence that account information, including passwords or Social Security numbers, had been taken. The bank also noted that there was no evidence of fraud involving the use of customer information.
Whew, that’s reassuring. Probably just some Matthew Broderick-style Russian kids wanting a sneak peak at Dimon’s newest release of Global Financial Meltdown. Heaven help us if they were real cyber criminals.
Noting that the attack may have begun when hackers breached the computer of a bank employee, the Guardian recounts other recent cyber attacks:
In September, Home Depot confirmed its payment systems were breached in an attack that some estimated impacted 56 million payment cards. Last year’s attack on Target impacted 40 million payment cards and compromised the personal details of some 70 million people.
But the Guardian describes the JPMorgan hack as “considerably more serious.” In addition to the size of the leak, banks hold much more sensitive personal information than retailers.
In his annual shareholder letter, Dimon wrote of cyber security, “We’re making good progress on these and other efforts, but cyberattacks are growing every day in strength and velocity across the globe.”
If those kids want to play Global Financial Meltdown that badly, they can probably get funding from Americans for Prosperity.
(Cross-posted from Hullabaloo.)
Germans are much happier with their lot than Americans, writes Harold Meyerson. Satisfaction tracks more closely with a country’s economy than its style of government, according to a recent Pew survey of the world’s economies. Nine out of ten people in countries with “advanced” economies were dissatisfied with theirs, and eight felt their economies were “bad.” Except Germany.
A strong, manufacturing-driven export economy (with the Euro a factor) and a weaker financial sector sets Germany apart from the United States. Whereas 58 percent in the U.S. feel the economy is bad, 85 percent of Germans felt things in Germany were going well. Why?
Many of Germany’s most successful companies are privately owned and not subject to investor pressure to reward large shareholders through practices prevalent in the United States, such as slashing wages, cutting back on worker training and research and development and buying back stock. Publicly traded German companies still retain their earnings to invest in expansions, a practice that was the U.S. norm until the doctrine of rewarding shareholders with nearly all of a company’s profits took hold during the past quarter-century.
In the United States, major shareholders and the top executives whose pay increasingly is linked to stock price control the corporate boards that approve these kinds of distributions of their companies’ earnings. In Germany, however, the profits that companies rack up are shared more broadly because shareholders don’t dominate corporate boards. By law, any sizable German company must divide the seats on its board equally between management- and worker-selected representatives. Any company with more than 50 employees must have managers meet regularly with workers’ councils to discuss and negotiate issues of working conditions (but not pay). These arrangements have largely ensured that the funding is there for the world’s best worker-training programs and that the most highly skilled and compensated jobs of such globalized German firms as Daimler and Siemens remain in Germany. They have ensured that prosperity is widely shared in Germany — not concentrated at the top, as it is in the United States.
Damned socialists. No … wait.
Some friends observed that tax and economic policy changes in this country over the last thirty years have shifted the business model from one that encouraged, long, slow growth sustained by good schools, sound infrastructure, and reinvestment — more like the German model — to one that encourages financialization and get-rich-quick schemes. Make your money fast and cash out. If that’s not your business model, said one from experience, American venture capitalists are uninterested in your better mousetrap.
Says Meyerson, since the 1980s U.S. business and government leaned on Germany “to get with the Wall Street program.” The Germans declined. Their economy did not. Overall, Germans seem rather satisfied with the results.
(Cross-posted from Hullabaloo.)
In a lead Sunday op-ed, I once slammed local planners for wanting to develop a former factory site into yet another strip mall anchored by big-box stores. Low prices, low wages. Just what the unemployed factory workers need, right? I couldn’t believe the editors allowed it to run with the line about stores selling “cheap, plastic crap from China.”
Now this from the WaPo: The Postal Service is losing millions a year to help you buy cheap stuff from China
Via an arcane treaty mechanism, the U.S. Postal Service delivers small packages from Chinese merchants to destinations in the U.S. at below its cost. The inspector general’s office estimated that foreign “ePacket” treaty mail cost the USPS $79 million in 2013 and another $5 billion last year.