Atlantic City Workers Stunned As Casino Economy Begins to Crash

by Bruce Vail

Facing stiff competition from other states who have legalized gambling, Atlantic City casinos such as Trump Plaza (pictured) plan to close, laying off thousands of workers.   Doug Kerr / / Creative Commons

Facing stiff competition from other states who have legalized gambling, Atlantic City casinos such as Trump Plaza (pictured) plan to close, laying off thousands of workers. Doug Kerr / / Creative Commons

More than 1,000 workers at Atlantic City’s Trump Plaza received notices July 14 that the hotel-casino planned to close its doors in just 65 days, eliminating all of their jobs. The news was not unexpected, though that fact doesn’t make it any easier to handle for the workers whose livelihoods depend on a local gambling economy in danger of an historic crash.

“It’s not surprising. A lot of people knew that eventually a shakeout would come,” says James Karmel, an author, college professor and consultant who has studied Atlantic City closely. The city’s gambling industry “is just not sustainable in its current form,” he says, mainly because newer casinos in Pennsylvania, New York, Maryland and elsewhere are luring New Jersey’s gambling customers away. Total annual gaming revenue has crashed, Karmel says, from an all-time peak of $5.2 billion in 2006 to $2.9 billion last year.

Indeed, the Trump Plaza is not the first local casino to close due to the crash, nor is it expected to be the last. Early this year, the Atlantic Club Casino Hotel closed, resulting in the loss of 1,600 jobs. Caesars Entertainment Corporation-owned Showboat Atlantic City has already announced that it expects to close Aug. 31, eliminating the jobs of another 2,100 workers. And the Revel Casino Hotel, currently employing about 3,000 workers, is currently in bankruptcy court, and is said to be in danger of closing before the end of the year.

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Leveling the Playing Field for Worker Cooperatives

by Abby Scher

NYCworkercoop_reportA quiet revolution is rumbling through New York’s municipal offices as they retool to support the creation of worker cooperatives as a way to fight poverty. Spurred by the powerful example of immigrant-owned cleaning cooperatives and the longstanding example of Cooperative Home Care Associates in the Bronx – the largest worker cooperative in the country – progressive city council members are allying with a new network of worker cooperatives, community based organizations that incubated immigrant-owned co-ops and the influential Federation of Protestant Welfare Agencies to figure out how the city can encourage this still-tiny economic sector. Once fully in place, New York City will be a national leader in providing municipal support for these democratic enterprises.

The pace of change is dizzying. In January, the federation released a short report arguing that worker co-ops help improve traditionally low-wage jobs by channeling the enterprises’ profits directly to their worker members, improving their lives in tangible ways. Then in February, Councilwoman Maria del Carmen Arroyo, chairwoman of the Committee on Community Development, held a hearing which put staff from the city’s Small Business Services and Economic Development Agency in the hot seat about how they were promoting worker cooperatives. In their final budget agreement on June 19th, the mayor agreed to the City Council’s request for $1.2 million for training programs with the aim of incubating a minimum of 234 new jobs, 28 new worker co-ops and help another 20 existing worker cooperatives to grow.

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“People Make Up Our City”: Why Seattle’s $15 Minimum Wage Is a Sign of Things to Come

by Amy B. Dean

Activists at an April demonstration demanding a $15-per-hour minimum wage in Seattle  (15 Now Seattle)

Activists at an April demonstration demanding a $15-per-hour minimum wage in Seattle (15 Now Seattle)

For 100,000 working people in Seattle, a newly passed citywide minimum wage of $15 per hour will mean an increased standard of living – and recognition of their contributions to the local economy. “It’s going to help me and a lot of other people,” said Crystal Thompson, 33, a Dominos Pizza customer service representative who currently earns the city minimum wage of $9.32 per hour. “They [the corporations] have been making money off us. I’ve had the same job for five years and [am] still making minimum wage. I open and close the store. I pretty much run the store and do manager shifts and still get paid minimum wage.”

The basic argument behind these campaigns is that a person working full-time shouldn’t have to live in poverty, a precept that has been popularly accepted.

While Seattle is often associated with technology-driven firms such as Microsoft and Amazon, service workers like Thompson provide a critical backbone for the area economy – a trend that also holds nationally. Over the past 20 years, community and labor organizations have united in a living wage movement to raise the floor for these employees and to make sure that prosperity is widely shared throughout the economy. Even as efforts to increase the minimum wage nationally have encountered resistance in Congress, this movement has made great strides at the local and regional levels.

The Seattle victory – part of the national Fight for 15 drive – represents the latest landmark achievement for living wage advocates. The efforts to secure the win over past months, as well as ongoing efforts to protect it from state-level attacks, hold important lessons for the rest of the country.
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Lousy Pay? It’s Your Fault!

by Gregory N. Heires

Low Pay new image copyTechnological change and inadequate education are often cited as the principal causes of our wage crisis.

This argument, in a certain sense, blames workers for their plight. They are unwilling to invest sufficiently in their education, and they lack the necessary skills for complex jobs in the Information Age.

Similarly, conservatives charge that the unemployed leach off the taxpayers, content to get by on generous unemployment benefits and to allow unskilled immigrants to do the low-wage work that they should be doing.

Blame the individual. It’s a very American concept. As the title of a song from the musical “Into the Woods” by Stephen Sondheim puts it: “Your Fault.”

Another argument is that we can’t do much about the wage decline.

Americans simply can’t compete with the low-wage workers of China and developing countries. This presumes a certain inevitability about our falling standard of living. So, let’s just give in.

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U.S. GDP Drops -2.9%–Recession or Stagnation?

by Jack Rasmus

Jack Rasmus

Jack Rasmus

Final revisions to US GDP released June 25, 2014 show the US economy contracted this past January-March 2014 by -2.9%. Does the much larger than predicted decline reflect the beginning of new recession? A -2.9% contraction for the quarter is just about the average quarter decline during the 2007-09 last recession. Or is the -2.9% an indication of a continuing stagnation, with a moderate recovery in GDP to occur in the second quarter 2014? Or perhaps it was just an aberration, due to bad winter weather, as many mainstream economists and press pundits are now saying, with a robust recovery of 4%-5% GDP growth coming in the second half of 2014?

The larger than expected -2.9% contraction was a further significant reduction from the government’s GDP estimate of a -1.0% GDP decline for the quarter that was reported by the government in May; and an even bigger 3% ‘swing’ from the initial +0.1% GDP estimate reported in April.

The record-setting ‘swing’ of 3% represents the largest such adjustment in nearly four decades, raising a question of why the government’s initial GDP estimate of 0.1% was so far off the mark in the first place? It also raises a question of just how accurate are estimates of GDP in today’s post-2008 ‘great’ recession restructured US and global economy? Is estimation becoming more a game of ‘guestimation’?

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WikiLeaks Reveals True Intent of Secret TiSA Trade Talks

ITUC OnLine

International Trade Union Confederation

International Trade Union Confederation

A WikiLeaks exposé has revealed the true intent behind secret 50-country negotiations on a new “financial services” chapter of the Trade in Services Agreement (TiSA) at the WTO in Geneva.  The draft agreement being discussed by government officials is aimed at weakening financial regulation and giving extra market access to hedge funds, banks, insurers and other providers.

Sharan Burrow, ITUC General Secretary, said, “Governments are negotiating away financial regulation in secret, instead of tackling the unfinished regulation task that triggered the current global economic crisis in 2007.  It defies belief that they are actually planning to help the already ‘too big to fail’ banks and other financial conglomerates to expand.”

“It is deeply disturbing to find out that governments are getting ready to exempt from or expedite the approval of some of the most toxic insurance products, like Credit Default Swaps, and also allow hedge funds and banks to launch ‘unlimited new products’ without proper controls.”

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Bending the Arc of History

by Stan Sorscher

Many economists and policy-makers struggle to explain growing inequality and the erosion of the middle class.

Nobel laureate economist Paul Krugman has a simple explanation, “…corporations use their growing monopoly power to raise prices without passing the gains on to their employees.”

The top 1% take 93% of all new gains created in our economy.

They divide gains that way – because they can!

2014-06-18-Powertodividegains-thumb

 

Years ago, manufacturing workers had relatively strong bargaining power, which created a wage floor for all workers in the economy. Not anymore.

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How Outsourcing Harms the Middle Class

by Gregory N. Heires

racetobottomIn his best-selling book “Capital in the 21st Century,” French economist Thomas Piketty identifies privatization as one of the causes of global inequality.

Indeed, the sell-off of public assets in the former Soviet Bloc, Europe and Latin America has lined the pockets of the wealthy as the wages of workers have stagnated and dropped.

In the United States, privatization is also exacerbating the gap between the 1 percent and the rest of us. But privatization in the United States refers more to the contracting out of public services than to the sale of public assets.

A report by In the Public Interest released on June 3 takes a critical look at privatization in the United States. It describes how outsourcing by state and local governments is causing the erosion of the middle class. Continue reading

The Origins of Inequality: Grassroots Economics Training for Understanding and Power

If-us-land-mass-were-distributed-like-us-wealthDevelop your own skills to argue against inequality through small group discussions and group development of an inequality rap. in a workshop led by Steve Max, Training Director of the renowned Midwest Academy and a vice-chair of Democratic Socialists of America. Training will provide a multimedia overview of the American economy and growth of the rampant inequality that plagues our society today. We will close with a short overview of low-wage justice movements in New York City.

 

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A victory for corporate “reformers” over teacher unions in California

A victory for the corporate “reformers” in the decision of the court in Vergara v California

Duane Campbellby Duane Campbell

California judge Rolf Treu ruled Tuesday in the Vergara v.California case that California teacher tenure laws deprive students of their right to an education that is guaranteed under the state constitution and violates their civil rights. The decision is a major defeat for teachers’ unions and will presumably lead to challenges of tenure laws in other states. The ruling overturned five state statutes giving California teachers firing protections and rights to tenure and seniority.

The implementation of the ruling has been stayed while under appeal.

The Sacramento Bee editorial board and Bee columnists Marcos Breton and Dan Walters, along with their candidate Marc Tucker each applaud the court ruling. Note what they say in their columns. They applaud this defeat of the Teachers Unions, they do not deal with the critical issue of adequate school funding. June 11.

What do the sides agree upon?

It is clear that many students in California receive a substandard education and that failing schools are concentrated in poor and minority neighborhoods.   The judge cites the long history of successful law suites Serrano V. Priest I, II. III, and more that mandated changes in state funding to provide equal funding. There is also general agreement that teacher quality is a significant factor in improving education. Continue reading

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