We The People Are Losing Our Voice

When I read this newsletter from Robert Reich this morning, my jaw dropped.  Sure, I knew that capitalism has run amok in recent years and that We the People seem to have no value to many of our elected officials, but … even I wasn’t aware to what degree our best interests have been subjugated.  I hope you’ll take a couple of minutes to read and ponder Mr. Reich’s words …


Why isn’t corporate America behind the pro-democracy movement?

Time for the biggest companies to step up and protect what’s left of it

Robert Reich, 14 January 2022

Capitalism and democracy are compatible only if democracy is in the driver’s seat.

That’s why I took some comfort just after the attack on the Capitol when many big corporations solemnly pledged they’d no longer finance the campaigns of the 147 lawmakers who voted to overturn the election results.

Well, those days are over. Turns out they were over the moment the public stopped paying attention.

A report published last week by Citizens for Responsibility and Ethics in Washington shows that over the last year, 717 companies and industry groups have donated more than $18 million to 143 of those seditious lawmakers. Businesses that pledged to stop or pause their donations have given nearly $2.4 million directly to their campaigns or leadership political action committees.

But there’s a deeper issue here. The whole question of whether corporations do or don’t bankroll the seditionist caucus is a distraction from a much larger problem.

The tsunami of money now flowing from corporations into the swamp of American politics is larger than ever. And this money – bankrolling almost all politicians and financing attacks on their opponents – is undermining American democracy as much as did the 147 seditionist members of Congress. Maybe more.

Democratic senator Kyrsten Sinema — whose vocal opposition to any change in the filibuster is on the verge of dooming voting rights — received almost $2 million in campaign donations in 2021 despite not being up for re-election until 2024. Most of it came from corporate donors outside Arizona, some of which have a history of donating largely to Republicans.

Has the money influenced Sinema? You decide: Besides sandbagging voting rights, she voted down the $15 minimum wage increase, opposed tax increases on corporations and the wealthy, and stalled on drug price reform — policies supported by a majority of Democratic Senators as well as a majority of Arizonans. 

Over the last four decades, corporate PAC spending on congressional elections has more than quadrupled, even adjusting for inflation.

Labor unions no longer provide a counterweight. Forty years ago, union PACs contributed about as much as corporate PACs. Now, corporations are outspending labor by more than three to one

According to a landmark study published in 2014 by Princeton professor Martin Gilens and Northwestern professor Benjamin Page, the preferences of the typical American have no influence at all on legislation emerging from Congress.

Gilens and Page analyzed 1,799 policy issues in detail, determining the relative influence on them of economic elites, business groups, mass-based interest groups, and average citizens. Their conclusion: “The preferences of the average American appear to have only a miniscule, near-zero, statistically non-significant impact upon public policy.” Lawmakers mainly listen to the policy demands of big business and wealthy individuals – those with the most lobbying prowess and deepest pockets to bankroll campaigns and promote their views.

It’s likely far worse now. Gilens and Page’s data came from the period 1981 to 2002 – before the Supreme Court opened the floodgates to big money in the Citizens United case, prior to SuperPACs, before “dark money,” and before the Wall Street bailout.

The corporate return on this mountain of money has been significant. Over the last forty years, corporate tax rates have plunged. Regulatory protections for consumers, workers, and the environment have been defanged. Antitrust has become so ineffectual that many big corporations face little or no competition.

Corporations have fought off safety nets and public investments that are common in other advanced nations (most recently, “Build Back Better”). They’ve attacked labor laws — reducing the portion of private-sector workers belonging to a union from a third forty years ago, to just over 6 percent now.  

They’ve collected hundreds of billions in federal subsidies, bailouts, loan guarantees, and sole-source contracts. Corporate welfare for Big Pharma, Big Oil, Big Tech, Big Ag, the largest military contractors and biggest banks now dwarfs the amount of welfare for people.

The profits of big corporations just reached a 70-year high, even during a pandemic. The ratio of CEO pay in large companies to average workers has ballooned from 20-to-1 in the 1960s, to 320-to-1 now.

Meanwhile, most Americans are going nowhere. The typical worker’s wage is only a bit higher today than it was forty years ago, when adjusted for inflation.

But the biggest casualty is the public’s trust in democracy.

In 1964, just 29 percent of voters believed that government was “run by a few big interests looking out for themselves.” By 2013, 79 percent of Americans believed it.

Corporate donations to seditious lawmakers are nothing compared to this forty-year record of corporate sedition.

A large portion of the American public has become so frustrated and cynical about democracy they are willing to believe blatant lies of a self-described strongman, and willing to support a political party that no longer believes in democracy.

As I said at the outset, capitalism is compatible with democracy only if democracy is in the driver’s seat. But the absence of democracy doesn’t strengthen capitalism. It fuels despotism.

Despotism is bad for capitalism. Despots don’t respect property rights. They don’t honor the rule of law. They are arbitrary and unpredictable. All of this harms the owners of capital. Despotism also invites civil strife and conflict, which destabilize a society and an economy.

My message to every CEO in America: You need democracy, but you’re actively undermining it.

It’s time for you to join the pro-democracy movement. Get solidly behind voting rights. Actively lobby for the Freedom to Vote Act and the John Lewis Voting Rights Advancement Act.

Use your lopsidedly large power in American democracy to protect American democracy — and do it soon. Otherwise, we may lose what’s left of it.

Blame Biden!

The press has been grossly unfair to President Biden.  Even the outlets that Republicans taunt as being “left-leaning” such as The Washington Post and the New York Times have resorted to making much ado about any negative news, and ignoring or glossing over the positive.  And the right-wingers comeback is predictably … “Whaddabout when Trump was president?  The press always gave him grief.”  Sure, but there is one MAJOR difference … Trump deserved every bit of the criticism and more, while Biden is trying very hard to do the right thing, to reverse the damage that was done during the four years of Trump’s largely chaotic rule.

Just one example from Eric Boehlert’s newsletter, Press Run …

NBC ignores blockbuster 943,000 new jobs report

It’s hard to believe this actually happened, but it did. On August 6, the Department of Labor released the July jobs report which produced mind-boggling results — nearly 1 million new jobs were created as the U.S. economy roared back to life following the pandemic. For some inconceivable reason, “NBC Nightly News” on August 6 did not cover the jobs report; no mention was made at all.

They weren’t alone in shrugging off the fantastic economic news for the Biden administration. At 4 p.m. on that Friday, roughly seven hours after the stellar July job numbers were released, the story was highlighted in the 37th headline as you scrolled down the NBC News homepage. At the CBS News homepage, none of the top 50 headlines at that time addressed the jackpot economic report.

At CNN, by Friday afternoon the jobs report had been blacked out as the network’s homepage made way for “This Underrated Form of Exercise is So Good for You,” and “Lucy Lawless Reunites With ‘Xena’ Costar.”

The episode was perhaps the best indication that when it came to economic news, the press had a very specific story it wanted to tell in 2021 (inflation!), and that good news could be set aside.

I have seen President Biden blamed for the “supply chain crisis” which was really no crisis at all, as despite the dire predictions that store shelves would be empty for Christmas, retail sales in the United States jumped nearly 11 percent in 2021 compared with the holiday period in 2019.

After months of the media insisting consumers were terrified about the rising inflation rate, and that stores would be barren this season thanks to supply chain woes, shoppers snatched up everything in sight, sending holiday sales soaring to a 17-year high. Clothing sales jumped 47% compared to 2019 (pre-Covid), jewelry 32%, electronics 16%.  That runaway spending meant consumers had no problem finding products, despite months of dire media warnings and claims that it all meant terrible news for the White House.

I can speak from my own experience … I did all my shopping online this year, as due to both my own illness and the pandemic, I was not able to shop in person (nor did I have any desire to, for I am not a ‘shopper’).  Not one single item I ordered was delayed significantly or unavailable.  Not ONE!  Well … with the exception of toilet tissue … every time somebody says “BOO”, U.S. consumers run to the store and buy out all the toilet tissue.  I’ll never understand the obsession over toilet tissue!  Wine, I could understand, but toilet tissue???

And then there’s the issue of not enough workers to fill certain jobs.  This one confounds me, for the positions that companies are having trouble filling are low-paid jobs and workers have moved on to greener pastures where they can earn a living wage.  HOW THE HELL is that President Biden’s fault?  If there is blame (and there is – plenty to go around) it is the corporations who are unwilling to let a single penny of profit go to the people producing and selling their product.  Blame also lies with Congress , glossy-eyed over the donations of the aforementioned wealthy corporations, who have steadfastly refused to raise the the minimum wage beyond the current whopping (sarcasm intended) $7.25 per hour.  With increases in the Consumer Price Index (CPI), that $7.25 is now worth 21% less than it was in 2009 when it was last raised, or $5.73.  This amounts to just under $12,000 per year before taxes are withheld!  My rent alone is more than that!!!  So, is it any wonder that people are gravitating toward better paid jobs in an effort to feed their family and keep a roof over their heads without having to work 16-hour days???  No, folks, President Biden isn’t the reason companies can’t keep employees … the companies themselves are the root of their own problem.

The most recent unemployment rate as of November was 4.2% … matching the lowest level in 50 years, yet the media chose to focus on other issues, barely giving a nod to the unemployment numbers and in some cases claiming the numbers shouldn’t be taken seriously.  Granted, no president makes nor breaks the economy single-handedly, but if we’re going to criticize him over the negative, why not give him a bit of credit for the positive?

And then there’s Covid.  We have nearly 850,000 deaths in the U.S. due to Covid … the most of any nation on the planet.  Why?  No, it is not President Biden’s fault!!!  The former guy so mishandled and bungled the response to the pandemic in early 2020 that it is a miracle we aren’t all dead.  He intentionally withheld information and downplayed it, held rallies and events that were hotbeds for the transmission of the disease, yet Republicans and the media blame President Biden.  Biden has done everything in his power to ensure that there are sufficient vaccines for every person over the age of 5, but if there is blame for the continuing surge, it falls squarely on the shoulders of the anti-vaxxers.  Those who refuse the free vaccine for whatever ‘reason’ are responsible for the continuation of the rise in cases and deaths, and they are to blame for the isolation that many of us are still experiencing.

The Republicans such as Kevin McCarthy and many others feed this pack of lies to the media and they gobble it up like leftover Thanksgiving turkey!  The old saying is “If it bleeds, it leads”, but the new saying should be “If it pleases Trump, to the front page it will bump.”  I strongly suspect that the editors of the formerly reliable news organizations are well aware that they are distorting the news in many cases, but they must have some underlying reason to do so, and my guess is that it involves $$$$$$$$$$.  Doesn’t everything these days?

President Biden and his attempt to pass legislation to help the struggling people of this nation has become the scapegoat for any troubles, real, perceived, or contrived.  That it is unfair is the least of the problem … that it will colour the views of some of the people, ie voters, is the greater problem.  If President Biden and by extension the Democratic Party can be blamed for every problem, then the elections of 2022 and 2024 will indeed reflect those falsehoods.

I don’t expect the media to fawn over the current president, but neither do I expect them to jump into the fray of finger-pointing and blaming him for problems that started long before he took office!  I expect them to report facts and leave the drawing of conclusions to their readers – most of us are, after all, smart enough to put two and two together and understand what is happening.  Unfortunately, others will gobble up the sensational headlines and continue to blame President Biden for everything from the price of lemons to the toilet paper shortage!

The Week’s Best Cartoons 3/6

I thought perhaps some of the political cartoonists would be standing in the unemployment line once the former guy left and peace was once again restored to the nation.  But, I couldn’t have been more wrong!  The Republicans are keeping the cartoonists just as busy as ever with their horrible attempts to stifle voters’ voices, disregard the pandemic, and more.  Thanks to TokyoSand, we can see the best of the lot all in one place!

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See All The ‘Toons!

The Rich Get Richer While The Poor …

The minimum wage increase to $15 per hour is essentially dead in the water … for the moment.  I saw a comment from a woman in the state of Washington that every member of Congress should be forced to answer …

“I live in Eastern Washington state and we are fortunate to have a much higher minimum wage for our workers. Our neighbors in Idaho are not so lucky. Many people who are able to live in Idaho work in Washington to benefit from the higher wage. The wage a person earns should be equal to the amount of effort that is required to do the work. I would really like to know though why our politicians think they deserve to make so much money. They say they care about the average worker and want a better life for all Americans, but when was the last time they tried to live on minimum wage?”

She makes excellent points, especially when you consider the fact that nearly half the members of Congress are millionaires!  Many members of Congress live in wealthy enclaves, use expensive healthcare services, and send their children to private or high-income schools.  Never once in their lives have they had to put something back at the grocery store because the total came to more than they had.  Never once have they had to make a choice between paying the rent or the electric bill.  Never once have they lived, even for a single week, in poverty.  Never once have they watched through tear-filled eyes as the repo man took their car away.  And yet, these are the people who make the decisions about our lives.

The current minimum wage of $7.25 equates to $15,080 per year.  The lowest paid member of Congress ‘earns’ $174,000 per year, which equates to $83.65 per hour, or 12 times what the minimum wage earner makes.  Think about that one for a few minutes.

Time in Washington is disproportionately spent fixated on the needs and desires of America’s wealthiest citizens, for they are the donors on which politicians’ campaigns rely.  I have said before that I think every candidate running for a seat in Congress should have to spend one full month in public housing, paid $7.25 per hour for a 40-hour week, and have zero access to their own money or resources.  I think it would be a tremendous eye-opener for many who have spent far too long in ivory towers and cannot possibly understand the challenges most of us face every day.

Amazing, isn’t it, that with the country deep in debt ($28 trillion), Congress was able to find it in their hearts to pass a tax cut benefiting almost exclusively the wealthy, but they cannot find it in their heart to increase the minimum wage that has remained stagnant for twelve years now, despite consistent increases in the cost of living!

Today, the Senate began debate on the pandemic relief bill that was passed by the House on Wednesday night.  The bill would provide a payment of $1,400 to individuals earning under $75,000 and families earning under $150,000.  Personally, I think those limits are too high and it should be reserved for those who are truly struggling … a family earning $150,000 is hardly struggling.  But to the point, the republicans in the Senate are against the bill, they want it to be far less, saying that the economy is coming back, people are going back to work, therefore they don’t need that much.  Tell that to the mother of three who is about to be evicted from her home because she can’t pay the rent!

Republican senators plan to delay passage of the bill by proposing numerous amendments, forcing valuable time to be spent debating each amendment, then voting on it.  Yesterday, thanks to Senator Ron Johnson, valuable time was wasted by forcing clerks to read the entire 628-page bill aloud to an audience of one – Senator Johnson.  Some people, meanwhile, cannot pay their electric bill and are in danger of having their electricity shut off.  The 535 members of Congress have never been in that situation and therefore cannot comprehend what it’s like.  I have been there and worse, and likely many of you have been too, but the people we elect and whose salaries we pay have no idea what being poor means.  They are blind to how the people they say they represent live, and yet they arrogantly say that $7.25 is enough for a family to live on, that the same family does not need a $1,400 stimulus payment.

A word of caution to members of Congress in both parties – keep up the delaying tactics, keep pushing the poor further and further into poverty, and there will be a price to pay.  Enough is enough, and We the People are sick of their greed and arrogance at our expense.  Some claim the U.S. is a democracy – it isn’t.  It is a plutocracy:  government by the wealthy.

Snarky … puff puff … Snippets

More than a few times in the last week, I have found myself dreading to even log onto any of the news sites.  Blogging friend Brian, concerned for my emotional well-being, advised me to take an entire week away from the news, and while I so greatly appreciate him caring, I simply find that I cannot.  Every day brings a new abomination, and somehow, I feel an obligation to keep up.  In part, it is because I think part of the goal of Trump & Co is to overwhelm us to the point that we simply tune out.  I’m determined not to do that … I simply cannot.  A number of my friends and readers have at least partly tuned out, and I understand that … I really do … but I cannot.  Writing this blog is the catharsis that offsets, to a greater or lesser degree, the angst … I think.  Anyway … with that in mind, I can do nothing but give you yet another batch of … Snarky Snippets!


Two thumbs up …

To New York City for a positive move on homelessness.  While Donald Trump, on his visit to California earlier this year, complained that …

“We have people living in our best highways, our best streets, our best entrances to buildings, where people in those buildings pay tremendous taxes.”

Meanwhile, New York City is expected to pass a new bill in the coming week that will force developers of designated affordable-housing projects to set aside 15 percent of the units for the homeless.  This could ultimately add as many as 1,000 apartments for the homeless per year, almost doubling the 1,300 already in existence.  Many other cities have similar requirements, but none as ambitious as this one.

The homeless rate in the United States has increased in recent years, despite Trump’s claims that the economy is doing so great.  New York City alone has increased from 64,000 in 2014 to 79,000 in 2019.  The increase is partly due to stagnant wages … the low unemployment rate doesn’t address wages … and partly to the increased cost of housing.  The rent in my own small (1,190 sq ft) townhouse has increased from $625 when we first rented it in 1998 to $1,162 in 2019 – an 86% increase in 21 years, though nothing has been replaced, not carpet, linoleum, paint, fixtures or appliances, in that time.  And this is in a low-income neighborhood!  How a person earning minimum wage … which, by the way, has not increased since 2009, ten years ago … could afford even basic housing, plus utilities and food, is beyond me!


Disenfranchising more voters?

Earlier this evening, I saw a tweet by my least favoured representative, Warren Davidson, that called for stricter voting laws.  His comparison was ludicrous …

Warren-Davidson“Saying #VoterID laws suppress voter turnout is similar to saying background checks suppress gun ownership. All polling locations should require #VoterID just like all firearms dealers require a background check.”

Since I take great pride in harassing him at least once a day, I responded with an explanation of the difference between gun ownership and voting, and asked him if he was really that stupid, or if he was just pretending.

But, to the point … Donald Trump has had a very low approval rating for the entirety of his presidency, and now he is being impeached.  The republicans are getting worried about his electability … understandable, since they have tied their carts to his pony.  So, red states are trying to pass more restrictive Voter I.D. laws, and anything else they can do to disenfranchise the poor and minorities who tend to vote largely democrat.

The State of Wisconsin has taken an approach that I find absolutely disgusting.  In October, they sent letters to hundreds of thousands of voters, asking them to respond if they were still at that address or to update their registrations if they had moved.  Sounds innocuous enough, right?  Perhaps it was, in the beginning, but conservatives filed a lawsuit alleging that to avoid fraud, the commission should have thrown out the registrations of voters who did not respond to the mailing within 30 days!  The Election Commission had initially planned to throw out those registrations in April of 2021, after the election, if the people who didn’t respond also didn’t vote.

But, on Friday Ozaukee County Judge Paul Malloy ordered the state to take as many as 234,000 people off its registered-voter list who had not responded to the letter within the 30-day period.  Now, I can tell you that if I received such a letter, it would probably go straight in the trash, for I take such things with a grain of salt and don’t have time for such foolishness.  Turns out that the majority of those letters were sent to voters in districts that were won by Hillary Clinton in 2016 … coincidence?  I don’t think so.

See, here’s the thing … Trump won Wisconsin by a very narrow margin – less than 1%.  So, there is a push to ensure some of those voters who voted for Hillary Clinton in 2016, cannot vote at all in 2020.


A law unto himself …

Remember how there were a number of people who had heard Trump’s call with Ukrainian President Zelenskyy, several of whom found the call deeply troubling, and one found the courage to become “the whistle-blower”, which has led to the impeachment that is almost certain to take place on Wednesday?  Well … the Trump administration has fixed that problem for any future phone calls.  According to CNN …

“Donald Trump’s senior aides have further restricted the number of administration officials allowed to listen to the President’s phone calls with foreign leaders.  Transcripts of Trump’s calls with world leaders are also disseminated to a far smaller group of people inside the White House, continuing an effort to limit the number of people with insight and information about the conversations.”

It’s rather like the child who, getting caught stealing cookies from the cookie jar, learns to make sure that next time, mommy is in the bathroom before dipping into the jar.  Well, it fits, doesn’t it, for we have a child in the Oval Office.

trump-phone-call.jpgMake of this what you will, but I find it deeply concerning.  It’s yet another attempt at covering up his actions, rather than promoting that ‘transparency’ he promised some three years ago.  Remember the ‘swamp’ he was going to drain?  That swamp was a rose garden compared to the swamp he has built.


Well, folks, that’s all I have time for tonight!  Enjoy what’s left of your weekend!

Trump-Barr

Sigh … More Snarky Snippets …

Some nights the mind bounce simply does not allow me to focus on my more in-depth projects … I have three of them in-process at the moment … and so nothing will do but a few snarky snippets.  Sorry, folks … I simply cannot help myself.  Sigh.


Underpaid???

I want you to get out your box of tissues and don your sympathy hats, for this one’s a real tear-jerker.  Members of Congress have not had a pay raise … not even so much as a cost-of-living increase … since 2009 – ten years!!!  The horror!  I mean, the majority of them only earn a paltry $174,000 per year!  How on earth are they managing?  So, two republican representatives, Kevin McCarthy and Steve Scalise, have quietly proposed a pay increase … just about a 2.5% increase … ballpark $3 million per year in total … nothing to break the bank.

But wait!  The minimum wage rate of $7.25 also has not been raised since 2009.  The full-time minimum wage worker earns $15,080 per year.  Um … that is a mere 8.67% of what those members of Congress are earning.  All of which might not cause a raised eyebrow except … back in March there was a bill in Congress to raise the minimum wage to $15 per hour in increments by 2024.  Guess what?  The bill ran into a bit of a snag, with every single republican, including Representatives Scalise and McCarthy, committed to voting against it, and even some democrats refusing to support it, saying it would place an “unfair burden” on small businesses.  Unfair burden?  Unfair burden???  What about the burden of all those people working second jobs just to survive???

The very people who are poised to grant themselves a $4,500 per annum pay increase, would deny the minimum wage worker an increase. The bill hasn’t garnered the 218 votes needed to pass the House, and even if it passes the House, Mitch McConnell has indicated that he will not bring the bill to a vote in the Senate.  And even if it passed both the House and the Senate, in all likelihood Trump would veto it.

Think about that one … the people who are making 11.5 times as much as minimum wage earners, most of whom are already millionaires, want a raise for themselves, but none for the man or woman who is struggling every day to feed their children, pay the rent, pay the doctor’s bills, and keep the electricity from being shut off.  My answer to the members of the U.S. Congress is do what the minimum wage earners are having to do … take a second or even third job!!!


Ignorance

In year’s past, a president might be applauded for a brilliant speech, or criticized for one that wasn’t so good, but it tells you all you need to know about Don Trump when he is praised for not veering off-script.  The speech he gave at the ceremony for the 75th anniversary of D-Day was praised by two of Trump’s media antagonists, Jim Acosta and Joe Scarborough, not for it’s content (Trump didn’t write it) or sincerity (there was none), but because he stayed on script and didn’t go off on a tangent as he is prone to do.

“This is perhaps the most on-message moment of Donald Trump’s presidency today. We were all wondering if he would veer from his remarks, go off of his script but he stayed on script, stayed on message …” – Jim Acosta, CNN

“I’m also glad the president chose to have the discipline to stick to script …” – Joe Scarborough, MSNBC

Sorry, guys, but given that he spent three full days making an ass of himself and of this nation while visiting our allies, he gets no kudos from me for managing a few minutes reading from a paper without veering off course.  Two and a half years in office, and this is his crowning achievement – being able to read a speech that somebody else wrote???  That’s sad.  That’s really, really sad.


Truer words have never been spoken than these by President Dwight David EisenhowerD-Day


Th-th-that’s all f-f-folks

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While we were distracted, look what oozed in through the keyhole – by musingsofanoldfart

Our friend Keith Wilson wrote this post a couple of weeks ago … 05 February … and I meant to re-blog it when I first read it.  I actually thought I had shared it with you all, but I eventually figured out that I hadn’t, and by that time the re-blog button had disappeared, so I waited.  Obviously, holding my breath for the return of the button is not working, so I will share Keith’s post in this manner, for this is too important and we really need to get the word out.

Please take just a minute to read the latest in our government’s attempt to help the rich get richer and ensure that the poor get poorer.

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Independent views from someone who offers some historical context

KeithOn December 5, 2017, the Department of Labor under the guidance of the self-proclaimed populist President offered proposed regulations that would affect tipped employees. The 60 day comment period just expired, so unless the push back was convincing this proposal may become regulation. The proposal unwinds an Obama regulation which prohibits an employer from garnishing tips from workers who make at least the $7.25 minimum wage.

It should be noted that restaurant workers have a lesser minimum wage of only $2.13 which has been in place for twenty plus years. They can be paid an hourly wage this low, provided their tip income brings their total hourly pay to $7.25. As of May, 2017, the average combined wage and tip income for restaurant workers was $11.82 per hour.

In essence, the proposed regulation would allow an employer to garnish the extra tips above a total wage rate of $7.25. Now, the employer could be altruistic and reallocate this tip income to all workers, such as the cooks and buspeople (those that clean off the tables). This could also include the tipped worker who would receive a reallocated portion, but less than the direct tips garnished.

Read more

Many thanks, Keith, for allowing me to share this important information!

It Trickles Up … Not Down!

Trickle-down economics is a theory that says benefits for the wealthy trickle down to everyone else. It is a theory that makes sense … on paper.  In reality, it has been tried more than once and proven that it does not work.  Repeat after me:  Trickle-down economics does not work.  It does not trickle down, but rather pools in the bank accounts and investment portfolios of those who already own most of the nation’s wealth.

economy-8The theory is that if the government provides substantial tax cuts, industry de-regulations, and negotiates trade agreements that favour the big businesses of the nation, those big businesses will earn higher profit margins, and will therefore use their additional wealth to build more factories, hire more people, create more jobs, increase workers’ wages and benefits. The workers will have more money to spend, will buy more ‘things’, thereby increasing the profits of the big businesses who will use that additional profit to … well, you get the picture, right?  Sounds about right, don’t you think?  Yes, it sounds good, looks good on paper or white boards in boardrooms and congressional offices around the nation … but it does not work in reality.

economy-3Ronald Reagan tried it in the 1980s, thus leading to some calling it ‘Reaganomics’.  It did not work.  The U.S. economy was in a slump when Reagan took office in 1981, so he did two things:  lowered taxes and increased government spending.  Now, at this juncture I want to take a minute to let you know that I do not intend to provide a lesson in economics.  I am savvy enough, but I am not an economist, and I typically leave these discussions to fellow-blogger Erik Hare over at Barataria.  But Erik sometimes goes into more depth than is needed, as he IS an economist.  Since I am not, I will put what little explanation I deem necessary in layman’s terms.  So, using an over-simplification to explain what happened under Reagan …

Think of it on a personal level.  You decide you want to enjoy life more, so you cut back your hours, thereby reducing the income from your job.  At the same time, since you want to enjoy life more, you spend more money on such things as dining out, travel and household goods & clothing.  For a while, perhaps, life is great, but then … the homeowner’s insurance comes due, there is a huge auto repair, and your daughter starts college.  Uh-oh … it just caught up with you and now you must take out … loans.  Go further into debt.

This is what happened under Reagan.  He decreased the federal revenue by cutting taxes, increased federal spending in order to stimulate the economy, and for a while there was the illusion that it was working.  People had more money, and spent more, and they were happy.  But … time came to pay the piper and the money wasn’t in the treasury, so our federal debt tripled from $997 billion in 1981 when Reagan took office to $2.85 trillion in 1989 when he left office. Money is a finite resource.  If you rob from Peter to pay Paul, as the saying goes, then soon you will need to rob from somebody else to pay Peter back.  And remember that debt is not free.  Take out a loan for that new car, and you will pay approximately 4.5% in interest.  The federal government must also pay interest on its debt.

Then in 2001, George W. Bush tried the theory once again, cutting income taxes in an effort to stimulate the economy.  Which it did … temporarily, until unemployment began to rise.  So in 2003, he further cut taxes on business.  According to the theory, the tax cuts should have helped people in all income levels. In fact, the opposite occurred. Income inequality worsened. Household income rose 6 percent for the bottom fifth. And 80 percent for the top 1 percent who saw their income triple. Instead of trickling down, it appears that prosperity trickled up.

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Okay, so we see that it does not work, but why?  I could point you to any number of studies with lots of graphs and charts to show inverse correlations, etc., but we would all be bored.  The bottom line, I firmly believe is multi-fold.  First, tax cuts reduce the revenue of the federal government, meaning that, since our government will almost never cut military spending, it will instead cut funding for social welfare programs, meaning the lowest income families will actually have less spending power.  Second, federal debt will have to increase to cover the deficiencies caused by the tax cuts.  And … here is, perhaps, the biggest reason:  GREED.  Big businesses that benefit from tax cuts are typically corporations who owe their very existence to their stockholders.  They will keep those stockholders happy with higher annual dividends before they consider paying their employees higher wages or increasing benefits, let alone hiring additional staff.  Purchasing additional factories?  Perhaps, but that is not likely to increase jobs significantly, especially with today’s rapidly growing technological advances cutting jobs in many fields.

Now why, you are asking, is Filosofa boring me to tears with all this?  Because, friends, Donald Trump is proposing/planning to go far beyond what either Reagan or Bush did in order to help big businesses, and he is dead wrong.  I won’t expound on the potential outcomes if he is fully successful in pushing his plans, for that is an entire topic in itself.  However, he has already begun with his rollback of certain regulations for which we will pay a terrible price, with no benefit to those who most need it.

Take, for example, what he said last week in a speech in Missouri: “We must reduce the tax rate on American businesses so they keep jobs in America, create jobs in America and compete for workers right here in America — the America we love.” Excuse me, but a large portion of Trump’s own products are manufactured overseas, as I have mentioned in previous posts, and 100% of his daughter, Ivanka’s products are manufactured overseas. Put your money where your mouth is, Trump!

What has Trump done thus far to help businesses see higher profits?  Let us look at a few:

  • He has postponed rules that protect workers from dangerous silica dust and beryllium
  • He has given green lights to the Keystone XL and Dakota Access pipelines, which will help create a few thousand very temporary construction jobs
  • He has pulled out of the Paris climate accord, is seeking to scrap rules against coal-fired power plants and allowed the dumping of coal waste in streams
  • He has claimed credit for the opening of the Corsa coal mine in Pennsylvania, even though the mine opened some two months before Trump was inaugurated
  • He claims to have kept some 1,200 jobs at the Carrier plant in Indiana from being moved to Mexico, but between layoffs and some jobs relocating to Mexico after all, the net number of jobs remaining in the U.S. is around 200

There is more, but this is enough for a wake up call, especially when we look at the cost of some of these moves, especially as pertain to the coal industry and oil pipelines.  Coal companies dumping their waste in streams in their backyard obviously, to those of us with eyes and brains, poses a health threat for the families of those coal miners Trump claims to “love”.  The rollback of regulations against coal-fired power plants and the blatant disregard for the environmental studies surrounding the pipelines is nothing short of criminal negligence and failure to protect the environment and those of us who inhabit this planet.  Add to that, the fact that coal jobs may come back in very small numbers and for a short time, but overall, increased use of cleaner energy substitutes like natural gas, solar and wind have come too far and proven effective both in terms of a cleaner environment and cost-effectiveness to ever take a backseat to fossil fuels again.

economy-6.jpgIn addition, Trump has been applauded by businesses for rolling back or repealing workplace regulations – safety regulations – that were costing businesses billions of dollars annually.  I don’t know about you, but I would rather see OSHA do its job in keeping workers safe than trust businesses to take matters of worker safety into their own hands.

So what’s next on the Trump agenda?  Why, tax cuts for business and industry, of course.  And this brings me, after a circuitous route, but I hope one with some value, to the reason for this post.  Tomorrow, Congress returns from its summer break, and among the first, highest-priority orders of business will be Trump’s budget.  The key feature of said budget, from what I am able to discern, is increased military spending coupled with tax cuts, primarily large tax cuts for corporations.

Cuts in revenue, the result of cutting business taxes, must be offset by either cuts in spending or an increase in costly debt. One of the more egregious items reportedly in Trump’s budget proposal is to cut money for mine safety enforcement and eliminate funding for the Appalachian Regional Commission, which has aided hundreds of coal counties by financing job retraining and social services, helping to cut Appalachia’s poverty rates nearly in half.

economy-7The most recent jobs report shows that job growth is slowing and wage rates are stagnant.  No surprise there, as the job growth rates over the first six months of Trump’s administration were merely a continuation of job growth under Obama.  Slow job growth with stagnant wage rates is not exactly a win-win, and Trump has adamantly argued against a raise in the federal minimum wage.

economy-2The budget debate is just about to begin in Congress, and I expect it to be contentious, especially in light of funding that will be required to help with disaster recovery from Hurricane Harvey.  One thing that is not needed, that will not help We The People, is tax cuts for large corporations and the top 1%.

Good People Doing Good Things – Dan Price

“It’s not about making money; it’s about making a difference.” – Dan Price, CEO Gravity Payments

Many times in the past few years, I have commented, snarkily, about the notorious 1% … the group of wealthy magnates who, though they account for only 1% of the population, control more than 90% of the wealth of the nation.  It is what we have come to think of as the ‘income divide’ or the ‘income gap’.  It is a vicious circle.  Rich people buy companies, the companies make money, the rich people who own the companies take that money and use it to buy more companies that make more money … Meanwhile, they balk at raising the federal minimum wage above $7.25 an hour, or about $15,000 per year.

The following came onto my radar through one of the sources I typically troll in search of ‘good people doing good things’, and as soon as I read the first paragraph, I knew I had found my good-person-of-the-week!  I almost backtracked, as I came upon some controversy & critique, but after reading everything I could find, considering the sources of the criticism, I concluded that this guy is the real deal and worthy of this post.  Allow me to introduce you to Mr. Dan Price, the CEO of Gravity Payments, a credit card processing company on the west coast.

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In March 2015, Dan Price was hiking with a friend, Valerie Molina, who lamented about being about being able to make ends meet on her $40,000 annual salary.  Listening to her was a bit of a wake-up call for Price, as many of his own 120 employees earned even less than his friend.  Then, he says, he recalled a paper by Nobel prize winners Daniel Kahneman and Angus Deaton, who found that people’s emotional well-being improves as their earnings rise, until their pay reaches about $75,000 a year, beyond which any additional earnings do nothing to increase happiness. Dan’s mind was made up that day, and he told his hiker-friend, “I’m going to pay all my employees minimum $70,000. I’m not sure exactly how I’m going to do it, I need to run the numbers, but I am. Is that crazy?”

And that is exactly what he did.  But that, in itself, is not the best part of the story in my view.  The best part is that he did it by reducing his own salary from $1.1 million annually to around $77,000 in order to cover the increases for his employees.  For the remainder, he has committed up to 80% of the company profits. According to Mr. Price, “That was the happiest I’ve ever felt. For me, it was the best money I’ve ever spent.”

But the road was not a smooth one, as he had his share of detractors, some disgruntled employees, and was even sued by his own brother!  Former Idiot of the Week, Rush Limbaugh:

“He is a good liberal, and he’s read that people are happy at 70 grand. What he doesn’t understand is, happiness does not equal productive. Happiness equals comfort. “Seventy grand, well, I can stop working hard,” is what it means.

Anyway, he’s not tying this to anything other than employment. He’s not tying it to performance. He’s not tying it to sales. This is pure, unadulterated socialism, which has never worked. That’s why I hope this company is a case study in MBA programs on how socialism does not work, because it’s gonna fail. My guess is that just like when Solyndra went south, there will not be a story on Gravity Payments succumbing to gravity and going under.”

Limbaugh wrote a very long-winded and critical piece on Mr. Price, the gist of which was that he is a socialist and his employees will become lazy and useless.  He has since been proven wrong, but remember … there is a reason he was Idiot of the Week last August.

Others were critical as well, saying he had an ulterior motive, or was doing it only for publicity.  Other entrepreneurs in the area were not happy, saying Price’s decision made them appear ‘stingy’.  And his brother, Lucas, who owned 30% of the company, filed a lawsuit claiming that Dan had “worked against his brother’s interest as a minority shareholder”.  Last July, a judge ruled in Dan’s favour, but nonetheless there is a rift now between the brothers.

Two employees resigned shortly after the announcement, saying that in their view it was unfair to double the pay of some new hires while the longest-serving staff members got small or no raises. There is some validity to that argument, but I still applaud what Mr. Price did, and perhaps if the employees had stayed, a compromise could have been reached.

The company’s success speaks for itself:  employee turnover is drastically reduced, business is booming, and net profits nearly doubled between 2014 and 2016.  While measuring happiness is not an exact science, the employees appear to be happy … so happy, in fact, that they all pitched in to buy Mr. Price a brand new Tesla automobile!

And perhaps even more important than what Mr. Price did for his own company is the ripple effect it has had, expanding to other companies who followed Price’s example:

  • Josh Ledbetter of Ledbetter, Inc., cut his own salary by 82% and used it to give his three employees substantial raises.

  • Tony Tran of Third and Loom was so inspired by Price that he raised the wages of all his employees in the U.S. and his factory workers in Vietnam to $70,000.

  • Mario Zahariev of Pop’s Pizza saved $7,000 annually in credit card fees when he became a customer of Gravity Payments.  He used it to give raises to all eight of his employees.

  • Andrew Green of Green Solutions gave all his employees raises beteen 35% – 50%, which doubled the pay of his lowest paid workers.

Megan Driscoll, chief executive of biopharmaceutical recruiting firm PharmaLogics Recruiting also took a page from Dan Price’s book after hearing him speak, and increased her employee’s salaries from $37,500 to $50,000 … with commissions they will be earning $70,000 or more.  She says the results are remarkable … employee turnover has reduced, revenue has more than doubled, and the profit margin is steady.

No one person is going to reduce the disparity in incomes in the U.S., but it seems to me that Dan Price has, despite some overwhelming odds, done his fair share.  “Income inequality has been racing in the wrong direction,” he said. “I want to fight for the idea that if someone is intelligent, hard-working and does a good job, then they are entitled to live a middle-class lifestyle.”

Dan Price – a man who cares more about people than money.

If you are interested in reading more about Dan Price, his decision, and his company:

Interview on Today Show

About Gravity Payments

The Gravity of $70k

Meanwhile, Back At The Sweatshop …

The minimum wage in the U.S. is $7.25 per hour.  For the fulltime worker, working 40 hours a week, that equates to $58 per day, $290 per week, $15,080 per year.  The federal poverty level for an individual is $11,770, and for a family of four is $24,250.  There has long been a call to raise the minimum wage in the U.S., one which I fully support.  However, I cite these figures today for comparative purposes.

In Bangladesh, 3.5 million workers in 4,825 garment factories produce goods for export to the global market, principally Europe and North America. Nearly every major clothing store in the U.S. sells clothing made in Bangladesh, including Macy’s, The Gap, Wal-Mart, L.L. Bean, Sears, J.C. Penney and many more too numerous to list.  While you may pay $40 for that pair of Lee jeans you are wearing, or $75 for the Anne Klein sweater you gave your sister for Christmas, the people who made those items are earning far less than subsistence wages.

In Dhaka, garment workers earn 5,300 taka, about $66.39 US dollars, per month, or about $797 USD per year.  Bangladesh is the second largest clothing exporter after China, yet has the lowest minimum wage in the world. The minimum wage rate was increased in 2013 from $38 USD per month.

bangla-2Last month, workers in Ashulia, a hub for garment factories on the outskirts of Dhaka, tens of thousands of workers joined a large protest for a raise in pay.  What they got, however was not what they had hoped for.  The protest caused some 50 factories to shut down for a week, many were arrested, and more than 1,500, including some who were not part of the protest, lost their jobs and were blacklisted.  Some of those who lost their jobs now fear harassment by police.

The minimum age for employment in Bangladesh is 14, however many smaller factories employ children much younger and pay them only a portion of what adults are paid.

There is also a safety factor to consider.  In 2013, known as the Rana Plaza disaster, a run-down eight-story factory complex making clothes for Primark, Benetton, Walmart and other Western brands collapsed, killing 1,138 and injuring more than 2,500 workers.  The death toll was eight times that of the historic Triangle Shirtwaist Factory fire in 1911.  One factory worker described working conditions:

“Since the disaster, employees have to work harder. They have higher production targets. If they cannot fulfil them they have to work extra hours but with no overtime. It is very tough; they cannot go for toilet breaks or to drink water. They become sick. They are getting the minimum wage as per legal requirements but they are not getting a living wage.”

When workers took to the streets to protest back wages owed to them, as well as working conditions after the Rana Plaza disaster, police opened fire, used tear gas and batons, injuring at least 50.  Western clothing companies, who benefit greatly from cheap labor in Bangladesh factories, were asked to contribute to a compensation fund for the victims, but a year after the disaster, only 5 of the 27 brands had offered to help.

We all complain from time to time about our jobs, working conditions, bosses, salaries, etc. – it is human nature, I think.  My daughter and a number of my friends have truly legitimate complaints, and I empathize.  However, I think that when we put things in perspective, most U.S. workers have it pretty good.  Certainly there is room for improvement, but there always will be.  It is all relative – the minimum wage in the U.S. ranks 11th worldwide (see chart below), however Bangladesh is at the bottom of that ranking.

bangla-minwagechrt

As I was writing this piece, I needed to go upstairs for a sweatshirt, as it is cold downstairs today, so I decided, just out of curiosity, to check the labels on a few articles of my clothing.  I found a pair of jeans was made in Egypt, while a t-shirt was manufactured in India.  But the one that confounded me was the sweatshirt of which the label says, “manufactured in EU, assembled in Mexico”.  It’s a sweatshirt, for Pete’s sake, not a 5,000-piece puzzle.  Two arms, a front and a back … and they needed to send it from the EU to Mexico to sew those four parts together?  I’m still scratching my head over that one!

It should also be noted, though it is not my reason for writing this post, but merely an aside, that some of the shirts in Donald Trump’s line of clothing are made in Bangladesh, while the rest are manufactured in China, Honduras and Vietnam. Make of that what you will.

bangla-gap

$90 Gap jeans

I do not know what the solution to the working conditions and low wages in Bangladesh are … I wish I did.  To boycott products manufactured in that country would only exacerbate the problem, as factories would close, workers would lose their jobs altogether, and poverty would increase.  So, while I have no solutions, I think it is necessary for us to be aware.  Aware and thankful, for our lives could be so much worse, and I think we often forget that.