How Workers Lose in Negotiations: The ABCs of Corporate Rip-Offs

by Carl Finamore

runaway inequality (3)

Unlike the ninety percent of American workers who have only their own personal voice to influence their wages, benefits and working conditions, union employees use their collective organization to establish guarantees.

And, union workers come to negotiations very well prepared with lots of economic data, with each contract proposal “costed out,” and with the whole team backed up by a professional staff of legal and industry analysts. So, then, how is it that we still get hammered

In real dollars, wages and benefits have not risen since the middle 1970s. We know this, but it still doesn’t make any sense. Why haven’t things improved for most of us and how has the seemingly impossible happened with 95% of all new income since the 2008 “recovery” going to the top 1%?

To answer these questions properly, we have to go beyond just blaming offshoring and contracting out and dig deeper, right down into the heart of how finance capital operates today.

Aside from the fact that unions seldom use their most powerful weapon, the strike, and aside from the fact that even fewer unions ever mobilize and organize their biggest asset, the members, our biggest problem in bargaining is that labor’s financial analysis of corporations only touches the surface. It misses the vast bulk of corporate hidden wealth.

As it stands now, the Top 500 corporations come to the negotiating table after already having played most of their big money cards elsewhere, in the stock market – thus, earning the well-deserved moniker of “casino capitalism.”

In essence, CEOs try to squeeze every dollar they can from offshoring, contracting out, terminating pensions, keeping wages low and reducing the workforce, just so they can push more cash into funding their ultimate prize – buying back stocks and paying dividends. This is where the real money is for investors.

Labor economist Les Leopold explains it in his new book: Continue reading

Why the Democrats Need to Take Sides in America’s Class–an excerpt

Harold Meyerson has an informative and insightful long-form essay up on The American Prospect.  It is, we think, an important analysis which should be widely read. The theme is “Straddling class divisions so last century. There’s a new base in town, and it includes a lot of people who used to be middle-class but aren’t anymore.” It is too long for a Talking Union post, so we present this excerpt.–Talking Union

by Harold Meyerson

Harold Meyerson

Harold Meyerson

This spring, a prominent Democratic pollster sent a memo to party leaders and Democratic elected officials advising them to speak and think differently. The nation’s economy had deteriorated so drastically, he cautioned, that they needed to abandon their references to the “middle class,” substituting for those hallowed words the phrase “working people.” “In today’s harsh economic reality,” he wrote, “many voters no longer identify as middle class.”

How many voters? In 2008, a Pew poll asked Americans to identify themselves by class. Fifty-three percent said they were middle-class; 25 percent said lower-class. When Pew asked the same question this January, it found that the number who’d called themselves middle-class had shrunk to 44 percent, while those who said they were of the lower class had grown from 25 percent to 40 percent.

Americans’ assessment of their place in the nation’s new economic order is depressingly accurate. Though most of the jobs lost in the 2007–2009 recession were in middle-income industries, the lion’s share of the jobs created in the half-decade since have been in such low-paying sectors as retail and restaurants. Median household income has declined in every year of the recovery. The share of the nation’s income going to wages and salaries, which for decades held steady at two-thirds, has in recent years descended to 58 percent—the lowest level since the government began its measurements. Continue reading

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.

Continue reading

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!

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

Continue reading

Living Poor in San Francisco Inequality by the Bay

By Carl Finamore

Savage truck in Bayview neighborhood in San Francisco

Savage truck in Bayview neighborhood in San Francisco

“I was born and raised in San Francisco but had to move to Oakland to provide for my young twins,” 24-year old working single mother Jaquayla Burton told me. “I wanted to stay near my family in the city I love and I could have if wages were higher, if job opportunities were available and if housing was more affordable.”

Jaquayla is not alone. This is a tale of growing inequality in one of the wealthiest cities in America and it just doesn’t have to be this way.

San Francisco is one of the most beautiful cities in the world resting on the Pacific Ocean with incredibly picturesque landscapes surrounded by plush water inlets and bays. Continue reading

University Presidents Are Laughing All the Way to the Bank While the People Who Work for Them Are on Food Stamps

by Lawrence S. Wittner

PresidentsalaryIs economic inequality growing in American higher education?

A report just issued by the Institute for Policy Studies―The One Percent at State U―indicates that it is. Surveying public universities, the report finds that the 25 highest-paid presidents increased their income by a third between fiscal 2009 and fiscal 2012, bringing their average total compensation to nearly a million dollars each. Also, the number of these chief executives earning over a million dollars in 2012 more than doubled over the previous year. In 2013, the best-paid among them was E. Gordon Gee of Ohio State University, who raked in $6,057,615 from this employment. Continue reading

Harold Meyerson: Eight Ways to Raise American’s Wages

Harold Meyerson

Harold Meyerson

Harold Meyerson has an important  long form article on American Prospect.  Here is a taste of “How to Raise Americans’ Wages: Eight proposals to jump-start the incomes of workers.”

The fist step is to identify the problem.  Meyerson writes:

As economists Robert Gordon and Ian Dew-Becker have established, the gains in workers’ productivity for the past three decades have gone entirely to the wealthiest 10 percent. The portion of the nation’s economy that went to workers’ pay and benefits—which had held remarkably steady from 1947 through 1973 at 66 percent or 67 percent—last year fell to a record low of 58 percent, while profits reached a postwar high.

Today, the drive to restore workers’ share has been narrowed down to the campaign to raise the minimum wage. That raise is long overdue. The real value of the federal minimum wage of $7.25 an hour is less than two-thirds of its level in 1968, which, in current dollars, would be $10.71. But even raising that wage wouldn’t do much for most workers; they make well more than the minimum, but their own wages have been stagnating or shrinking for decades as well.

What, then, do we do for American workers more generally? How do we raise their wages? How do we re-create a growing and vibrant middle class?

 

Continue reading

Inequality Gone Wild

by Gregory N. Heires

yacht-landscape-billion-oxfam-460We have a winner-take-all global economy, a malady that undermines democracy, distorts economic development and fuels inequality.

Timed to coincide with the meeting of the global economic elite at the World Economic Forum in Davos, Switzerland, a report released by Oxfam on Jan. 20 shows how the wealthy have rigged the economic and political rules in their favor. So much so that the 85 richest people in the world own as much wealth as the 3.5 billion poorest people.

“It is staggering that in the 21st century, half of the world’s population own no more than a tiny elite whose numbers could all sit comfortably in a single train carriage,” said Winnie Bryanyima, executive director of Oxfam, an international confederation of 17 organizations that work together to try to find solutions to injustice and poverty.

“We cannot hope to win the fight against poverty without talking inequality. Widening inequality is creating a vicious circle where wealth and power are increasingly concentrated in the hands of a few, leaving the rest of us to fight over crumbs from the top table.” Continue reading

Obama and Friends Discover Inequality

by Jack Rasmus

Jack Rasmus

Jack Rasmus

Today, January 28, 2014, President Obama will address the nation in his State of the Union (SOTU) speech to Congress. A major theme of the address will be the growing income inequality in the US.

His speech represents an echo of similar themes and talks that have been presented this past week at the World Economic Forum (WEF) in Davos, Switzerland. That’s where every January the big capitalists of the world gather to discuss amongst themselves the major issues of the past year and what to do about them—in between being entertained by various cultural celebrities and performers who have been allowed into their club as junior partners in wealth. The annual Davos cultural events are not unlike the small venue side-shows held in the big Las Vegas casinos: the entertainers strut and sing while the real betting and dice-rolling discussions involving future capitalist policy initiatives go on behind ‘invitation-only’ doors requiring tickets for entry costing hundreds of thousands of dollars to attend ( the typical ticket price of entry for a Corporate CEO and his entourage at Davos, for example, exceeds $500,000). Continue reading

Wage boost could pay Democrats dividends

by Harold Meyerson

Harold Meyerson

Harold Meyerson

American liberalism and the Democratic Party — two partially overlapping but by no means identical institutions — have set themselves an unusually clear agenda for 2014: reducing economic inequality and boosting workers’ incomes. These are causes they can fight for on multiple fronts.

Raising the minimum wage should offer the course of least resistance. Although congressional Republicans may persist in blocking an increase in the federal minimum wage, they do so at their own peril. Raising the wage is one of the few issues in U.S. politics that commands across-the-board public support. A CBS News poll in November found that even 57 percent of Republicans support such an increase. Continue reading