Facing Down Corporate Power in Boulder

Thanks to my sister-in-law, Donna, for posting this wonderful story to facebook.  I guess it’s wonderful because it’s kind of inspiring to read of a successful response to exploitation and bullying by corporate power.  The story is about how the Boulder, Colorado community discovered that they could go green and lower their utility bills despite the extraordinary pushback from the monopoly electrical utility. 

But it is also a powerful case in point.  Money can buy power because, not only can it buy political access, it can (often) buy public opinion as well. There is a point made in this video that is a deeply held article of faith by every experienced activist:  The 99-percenters will never be able to match the spending of the corporations, their CEOs or their major stockholders – spending on lobbyists, pollsters, consultants and super pacs.  The only hope everbody-else has against that kind of power is numbers.  People have to get on the phone, collect signatures, use cheap social media, and stand in the heat or rain in spite of concerted efforts to keep them from voting.

The other demonstration certainly bears endless repeating:  Corporations are not people.  They are tools.  They are controlled by boards and major stockholders and their first duty – by the terms of their charter – is to their stockholders:  not to their customers and not to their employees.   It is a happy coincidence when the needs of the many match the needs and proclivities of a large corporation.  This mechanical, relentless efficiency toward a very narrow end (enriching the stockholders) makes corporations potentially very dangerous.  They must be taxed enough to cover the resources they exploit – including, for example, their employees who need to be healthy and educated, or the environmental degradation that needs to be rehabilitated.  They need to be regulated because the drive to profit is indifferent to considerations of collateral damage.

The most insidious threat to the public from corporate power – more so than threats to health and safety – is the concentration of money.  That is the same thing as a concentration of power.  Strength in numbers can overwhelm such power but only with vigilance, knowledge and supreme effort.  The bad news is that the rich are getting richer.

Yogi Berra Said It Best

I read an email from Governor John Kitzhaber to his supporters.  It was an appeal for you to sign a petition.  As a signer you would declare that you were “in for schools”.  Your message to your legislators would be,

It’s time to get real about what our kids need to have a chance at successful lives. To do that, we have to put education ahead of politics. Let’s stand together in support of a reasonable proposal to improve school funding.

I have a bad feeling about this.  It is summed up best by giants far more eloquent than I.  Mark Twain said, "No man's life, liberty, or property are safe while the legislature is in session.”  Yogi Berra said, "It's deja vu all over again."

In June, Governor Kitzhaber and the Oregonian petulantly thumped State Senator Chris Edwards for voting with the Republicans to defeat a potential “grand bargain.”  Edwards contended that the “fix” would not restore the schools in his district.  This was a reasonable criticism since the touted goal was to gain more funding for schools.  A big source of the funding would be through “savings” from PERS (Public Employee Retirement System).  “Savings” in this context means pension benefit cuts to present and future public employee retirees.

Having dodged a bullet in June, many may have reason to be a little gun shy at the prospect of another shot at a “grand bargain” between the Governor and the Republicans in the state legislature.  PERS members are trying desperately to scrape the target off their back.

The state of Oregon is starved for revenue.  The only ones who disagree with that would be the Grover Norquist true-believers who would shrink government to the size where you could “drown it in a bathtub”. 

What are legitimate and likely sources for revenue?  Wait, first assume that you want “to put education ahead of politics” and that you want to “stand together in support of a reasonable proposal to improve school funding.”  So on these terms, further cuts to schools must be off the table as a revenue source.  There are other things that the state spends money on that could be cannibalized for funds:  prisons, human services including nutrition and public health, public safety, salaries or work days of state workers, pensions of state workers, etc.  There are federal sources – like grants, O & C payments, SNAP (food stamp) benefits; unfortunately, many of these are under threat, most immediately by the Sequester.

Cuts are – or at least they were back in June - an essential part of the big compromise, the so-called “grand bargain” to get everyone on the same page about state revenue and spending. So the easiest target, whichever that may be, is certainly in line for cuts to square the circle of this “grand bargain.”  

Governor Kitzhaber reminds us that “new revenue” (taxes) is another possible source of replenishment for state revenue.  This could include closing tax loopholes to corporations to restore lost revenue from those giveaways.  It might include eliminating preferential tax policies available only to the wealthy – an example of this in state and federal taxation is a reduced rate on capital gains. 

More actively it could be raising corporate tax rates to support the schools so they could provide the workplace skills that the business community says they miss in their new-applicant pool.  It could mean restructuring the full range of tax sources so that the system is truly progressive in its aggregate effect. It could mean raising taxes on those who can afford to pay them.

“New revenue sources” has an encouraging ring to it.  I’d like to see it.  All I'm seeing are cuts, more cuts and the victimization of the many to cut the tax bill of the few.

Krugman on Labor Day

Paul Krugman's Sunday New York Times article provides an up-to-the-minute, laser-focused reflection on the meaning of Labor Day in 2013.  It is provided here in full.

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September 1, 2013

Love for Labor Lost

By PAUL KRUGMAN

It wasn’t always about the hot dogs. Originally, believe it or not, Labor Day actually had something to do with showing respect for labor.

Here’s how it happened: In 1894 Pullman workers, facing wage cuts in the wake of a financial crisis, went on strike — and Grover Cleveland deployed 12,000 soldiers to break the union. He succeeded, but using armed force to protect the interests of property was so blatant that even the Gilded Age was shocked. So Congress, in a lame attempt at appeasement, unanimously passed legislation symbolically honoring the nation’s workers.

It’s all hard to imagine now. Not the bit about financial crisis and wage cuts — that’s going on all around us. Not the bit about the state serving the interests of the wealthy — look at who got bailed out, and who didn’t, after our latter-day version of the Panic of 1893. No, what’s unimaginable now is that Congress would unanimously offer even an empty gesture of support for workers’ dignity. For the fact is that many of today’s politicians can’t even bring themselves to fake respect for ordinary working Americans.

Consider, for example, how Eric Cantor, the House majority leader, marked Labor Day last year: with a Twitter post declaring “Today, we celebrate those who have taken a risk, worked hard, built a business and earned their own success.” Yep, he saw Labor Day as an occasion to honor business owners.

More broadly, consider the ever-widening definition of those whom conservatives consider parasites. Time was when their ire was directed at bums on welfare. But even at the program’s peak, the number of Americans on “welfare” — Aid to Families With Dependent Children — never exceeded about 5 percent of the population. And that program’s far less generous successor, Temporary Assistance for Needy Families, reaches less than 2 percent of Americans.

Yet even as the number of Americans on what we used to consider welfare has declined, the number of citizens the right considers “takers” rather than “makers” — people of whom Mitt Romney complained, “I’ll never convince them they should take personal responsibility and care for their lives” — has exploded, to encompass almost half the population. And the great majority of this newly defined army of moochers consists of working families that don’t pay income taxes but do pay payroll taxes (most of the rest are elderly).

How can someone who works for a living be considered the moral equivalent of a bum on welfare? Well, part of the answer is that many people on the right engage in word games: they talk about how someone doesn’t pay income taxes, and hope that their listeners fail to notice the word “income” and forget about all the other taxes lower-income working Americans pay.

But it is also true that modern America, while it has pretty much eliminated traditional welfare, does have other programs designed to help the less well-off — notably the earned-income tax credit, food stamps and Medicaid. The majority of these programs’ beneficiaries are either children, the elderly or working adults — this is true by definition for the tax credit, which only supplements earned income, and turns out in practice to be true of the other programs. So if you consider someone who works hard trying to make ends meet, but also gets some help from the government, a “taker,” you’re going to have contempt for a very large number of American workers and their families.

Oh, and just wait until Obamacare kicks in, and millions more working Americans start receiving subsidies to help them purchase health insurance.

You might ask why we should provide any aid to working Americans — after all, they aren’t completely destitute. But the fact is that economic inequality has soared over the past few decades, and while a handful of people have stratospheric incomes, a far larger number of Americans find that no matter how hard they work, they can’t afford the basics of a middle-class existence — health insurance in particular, but even putting food on the table can be a problem. Saying that they can use some help shouldn’t make us think any less of them, and it certainly shouldn’t reduce the respect we grant to anyone who works hard and plays by the rules.

But obviously that’s not the way everyone sees it. In particular, there are evidently a lot of wealthy people in America who consider anyone who isn’t wealthy a loser — an attitude that has clearly gotten stronger as the gap between the 1 percent and everyone else has widened. And such people have a lot of friends in Washington.

So, this time around will we be hearing anything from Mr. Cantor and his colleagues suggesting that they actually do respect people who work for a living? Maybe. But the one thing we’ll know for sure is that they don’t mean it.

Minimum Wage, Justice and Economics

It would be easy to sign a petition stating in the strongest terms that you support the idea that all minimum wage workers should be able to make a living.  I want that and at the same time, when employers say that the market value of their minimum wage workers’ labor is not even minimum wage, I believe them.  Any minimum wage worker who quits or is fired for cause can be replaced in an afternoon.  I can accept that as a fact. 

With little persuasion, I think I can accept that raising minimum wage to a living wage would cause more problems than it solves.  What would that be, any way;  doubling it as the hapless McDonalds workers in New York are demanding?  Working minimum wage full-time equals about $15000 a year.  So, OK, yeah, doubling it.

There are plenty of arguments in favor of it, simple justice being one of them.  Robert Reich points out that McDonalds’ CEO made 800 times what a McDonalds worker makes and Walmart’s CEO makes 1000 times what a Walmart worker makes.  Even a comfortably vested shareholder should have trouble with those numbers.  That comes out of the company’s earnings with commensurately less flow-through to the stockholders in the form of dividends or capital gains.  At 13.8 to 20.7 million dollars a year, respectively, each of those guys must be really, really smart and very good managers.

Paul Krugman points out that minimum wage has not kept up with inflation. In real (inflation adjusted) terms it should be above $10/hour.  Furthermore, in that time, worker productivity has doubled.  Fairness says it’s time for a raise.

I don’t shed a lot of tears for corporations and CEOs.  But if we are talking about fairness, I don’t think we should force employers to swim upstream through the raging rapids of ineluctable market forces.  It is not their personal or collective responsibility to guarantee a living wage to individual employees.  Then whose is it?  Oh-h-h, now we are treading on thin ice – smells like Socialism! 

Low wage workers, like all workers, need to pay bills, raise their kids, protect their health, all of that.  The Earned Income Tax Credit – basically a taxpayer subsidy of low wage workers - is one fair and equitable vehicle toward achieving that goal.  And I’m piling onto the bandwagon with Reich who also adds childcare, good schools, health insurance, and union rights.

"Right to Work" Explained

Many young new workers do not know about "right to work" and the reason behind the contention and emotion that goes with a discussion about "right to work".  A longish explanation is provided by Mother Jones.  This one, provided here in full, covers the basics: 

“Right to Work” Laws Explained

Thursday, 27 December 2012 10:04By se smith, Care2 | Report

The phrase “right to work,” which appears to date to 1902, sure seems catchy; it sounds like a guarantee of employment, right? In fact, it has nothing to do with whether you’re guaranteed to have and hold a job. Since it’s been in the news a lot in 2012, when the number of right to work states rose to 24, it’s worth taking a closer look at what this term means as well as the history behind it. All sides of the right to work debate are heating up, and it may be another critical labor issue in 2013.

To put it simply, a right to work law states that employees cannot be compelled to pay union fees and dues, even if they are covered under a union contract. The idea is that even if a union is operating in a given workplace, people shouldn’t be forced to join to keep their jobs, or ordered to join the union if other workers want to organize. Proponents of these laws say they protect the freedom of association, allowing people to opt out of union membership if they’re not interested.

Before 1947, right to work laws weren’t possible, but that changed with the passage of the Taft-Hartley Act, which outlawed the so-called “closed shop.” Closed shops restricted employment to union members only, requiring membership as a term of employment. People are also protected if they want to join unions, under open shop rules, which allow people to decide if they want to join unions and work regardless of union membership.

The Wall Street Journal, among other publications with a somewhat conservative lean, suggests that right to work laws promote job growth, but correlation is not causation. If there is a link, it may have to do with the fact that such laws are often used to entice business away from states without such laws with promises of lower wages; even the Journal has to admit that right to work states tend to have lower wages and less favorable employment contracts, because the collective bargaining power of unions is diluted.

Meanwhile, opponents of such laws argue that they create a bit of a free rider problem. Administering unions can be a costly endeavor, and the process of negotiating contracts can be painstaking and expensive, as can providing benefits for union members. If everyone in the union pays dues, costs can be kept lower for all members, and every worker is equally invested in the union. If some people aren’t paying, it creates an imbalance, and when union and non-union employees are covered under the same negotiated contract, it means that some people effectively get some of the benefits of union membership for free.

For labor organizers, such laws can represent part of an attack on organizing and union membership, making it harder for unions to promote the welfare of their members and workers in general. In the larger picture, less money also makes it more difficult for unions to engage in advocacy, political lobbying and other activities to protect workers and raise public awareness. For employers, such laws can reduce labor costs, as a weak union can struggle to assert itself at the bargaining table. As for workers, a strong union can make for better working conditions, a safer workplace, better benefits and more pay, and unions are stronger with more dues-paying members.

An Empty Offer

I read Dennis Richardson’s August 26 newsletter.  He is a legislator from the 4^th District of the Oregon House of Representatives.   I didn’t know much about him.  Now I know he is a Republican and a declared candidate to run for Governor.  I also read about Richardson in an August 19  post on a conservative blog, The Governed | NW Politics.  The Governed reveals that Richardson hasn’t a chance because he has betrayed his conservative roots.  With that confident assertion in mind, I’d guess that The Governed is probably correct.  Richardson also isn’t making good friends with another group that is usually considered to be outside that first group.  That leaves a rapidly shrinking middle.

Richardson manages to demonize, in double-digit percentages, big slices of a big group, Oregon workers.  He’s railed against PERS (Public Employee Retirement System) and presumably the beneficiaries who do, or hope to, participate in promised PERS benefits.  And he names three big public sector unions in Oregon – OEA, AFSCME, and SEIU.  All of them, according to Richardson, are responsible for various evils that have befallen Oregon.

You can follow along with the back-of-the-envelope calculations in the spreadsheet provided (for illustration only, dates from different samples may not match by a couple of years).  In a nutshell, there are about 1,670,000 workers in Oregon – 100% of the workforce.  Non-retired PERS workers are about 13% of the workforce.  Retired PERS workers – 118000 of them – are not part of the work force but they are probably sensitive to schemes to tamper with their fixed income.  The three big unions make up 7% of Oregon workers.

The question remains, whom exactly does Richardson represent?  Like Richardson, I can name names (I already have).  A number of them don’t even live in Oregon but their money and their influence do.  They share an activist agenda with a few very wealthy Oregonians. That agenda includes “right to work” (suppressing collective bargaining and collective union action), tax cuts for business and the wealthy, and cutting support for expensive services like schools, public safety, and human services.

More important than Richardson or his candidacy is how emblematic his position is: ideological and simplistic (the cure for unemployment is more jobs).  He offers less than nothing because his “solutions” come at the expense of social services, schools, workers, retirees and poor people.  

The Sequester

The Sequester is the ultimate IED rigged to rip the foundation from the lives of Americans wherever they take for granted any services from the federal government.  This post will not explain the Sequester but merely point to it.  On the face of it, the government will suffer a thousand cuts to the tune of $109 billion a year for ten years.  We’ve seen or heard of some of them and fidgeted a little in our seats from the sound of it.  But this is just the first round.  There will be cuts upon cuts upon cuts.  We are not talking about cutting fat.  We are talking about amputations, and sick surgery, doing away with redundant kidneys, lobes of liver, all teeth and a small amount of jaw bone.

I have no desire to be the Cassandra of the blogosphere.  I will not harp on the Sequester by describing color and texture, as the quicksand rises to our nostrils.  Neither will I ignore it.  I’m opening up a new page on this blog entirely dedicated to the Sequester.  I will mostly re-blog without comment by providing links.