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Posts Tagged ‘economic’

Inequality’s Getting Worse. How Do We End This?

Wednesday, July 6th, 2016

On July 1, at the start of the Independence Day weekend, we learned that income inequality in this country became even worse last year.

Economic inequality produces scars that last a lifetime – and even longer. That’s one reason why President Obama said in 2013 that “increasing inequality … challenges the very essence of who we are as a people.”

Well, that challenge just became even greater. Economist Emanuel Saez’s groundbreaking studies of inequality have helped reshape the political debate. In a July 1 publication, Saez found that the wealth gap between the top 1 percent and the remaining 99 percent became even worse in 2015. Earnings for the top 1 percent reached a “new high” that year. The 1 percent’s income increase of 7.7 percent was nearly twice everyone else’s.

Saez revisited several years of data and found that:

“(I)ncomes (adjusted for inflation) of the top 1 percent of families grew from $990,000 in 2009 to $1,360,000 in 2015, a growth of 37 percent … (while) the incomes of the bottom 99 percent of families grew only by 7.6 percent–from $45,300 in 2009 to $48,800 in 2015.”

Saez adds, “As a result, the top 1 percent of families captured 52 percent of total real income growth per family from 2009 to 2015.” He concludes:

“This uneven recovery is unfortunately on par with a long-term widening of inequality since 1980, when the top 1 percent of families began to capture a disproportionate share of economic growth.”

1980 was the year Ronald Reagan first took office, heralding a new era of economic conservatism in the United States. The message of these numbers couldn’t be clearer: it’s time for that era to end. Our 35-year experiment with conservative economics has failed.

Saez’ figures included a slight consolation prize for the 99 percent: Its average income rose by 3.9 percent last year, the biggest increase in 17 years. That’s an improvement, of course, but it’s not nearly enough. The 99 percent has endured decades of wage stagnation, and its income was essentially frozen in place between the 2008 financial crisis and 2013.

A society with such extreme and growing inequality can’t sustain itself forever. Inequality interferes with economic growth, robs people of opportunity (and with it, hope), dooms millions to poverty or near-impoverished conditions, and offends that part of the human spirit that constantly searches for fairness and equality. An overly unequal society like ours is inherently unstable, especially when its political system gives extremely wealthy individuals and corporations excessive control over the government – thereby perpetuating and amplifying their own wealth and power.

It will take years of work to repair the economic damage caused by these levels of inequality. And it’s important to remember that, while we measure many of our economic statistics on a quarterly or yearly basis, the human damage often lasts much longer than that.

Workers who suffer a period of unemployment or a drop in pay typically see their earnings decline for the rest of their working lives. This effect is particularly pronounced among recent college graduates, many of whom graduated into one of the worst job markets in history. Their income is likely to suffer through their entire careers as a result – while, at the same time, they have been saddled with the greatest student debt burden in human history.

Lower incomes are tied to higher infant mortality, shorter life spans, and poorer mental and physical health for parents and children alike.

Economic damage is often carried down the generations, through the children. Poverty can inflict lifelong damage on a child’s health and ability to earn. Economic mobility is very low in this country; parental income has an enormous influence on the earning power of children, and studies have consistently shown that Americans enjoy much less upward mobility that residents of Canada and most Western European nations.

What can we do to reduce inequality and heal some of its deep, long-lasting wounds? Here’s a partial list: We can increase funds for antipoverty programs that provide food, shelter, and other services directly to the poor. We can improve our educational system and provide tuition-free public college to all qualified students. We can address the systemic racial injustice that deprives communities of color of economic resources. We can raise the minimum wage, which has fallen far behind inflation (and even farther behind productivity) since 1968. ($15 an hour is a good number.)

We also need to strengthen the labor movement. A recent study by the International Monetary Fund found that a “decline in union density has been strongly associated with the rise of top income inequality” and that “unionization matters for income distribution.” We must provide health insurance for all, and ensure that all working Americans have access to the paid leave programs and other benefits found in other developed countries. We must expand initiatives for worker-owned businesses.

What’s more, we need to do these things quickly, before income inequality – and the loss of democracy that accompanies it – grows so great that it becomes irreversible.

The Fourth of July has come and gone. But the scars of inequality are still here, depriving millions of us of the freedom to choose, to grow, and even to live. Our work has just begun.

This blog originally appeared in ourfuture.org on July 6, 2016.  Reprinted with permission.

Richard Eskow is a Senior Fellow with the Campaign for America’s Future and the host of The Zero Hour, a weekly program of news, interviews, and commentary on We Act Radio The Zero Hour is syndicated nationally and is available as a podcast on iTunes. Richard has been a consultant, public policy advisor, and health executive in health financing and social insurance. He was cited as one of “fifty of the world’s leading futurologists” in “The Rough Guide to the Future,” which highlighted his long-range forecasts on health care, evolution, technology, and economic equality. Richard’s writing has been published in print and online. He has also been anthologized three times in book form for “Best Buddhist Writing of the Year.”

Working America: 10 Things You Should Know About Paycheck Deception

Tuesday, March 19th, 2013

dougfooteSince 2010, right-wing governors and legislators have attacked workers’ rights across the Midwest. These attacks have come in different forms: from stripping public workers’ collective bargaining rights in Wisconsin to an all-out ban on fair share contracts in Michigan and Indiana.

In Missouri, extremist legislators and their corporate backers are taking a different tactic. They are pushing paycheck deception bills, which limit how union workers can make their voices heard in the political process.

Proponents of paycheck deception are counting on the public to be uninformed (or misinformed) about what these bills actually do. So here are 10 things you should know about paycheck deception:

Paycheck deception laws create unfair regulations. These laws require labor organizations to go through burdensome bureaucratic hoops in order to deduct dues from members’ paychecks and to use that money for political advocacy. No other corporation, CEO or other organization has similar restrictions. The sole intent is to force the union to spend more resources collecting dues so that they have less ability to advocate for workers at workplaces and in politics.

Paycheck deception laws limit free speech. These laws apply rules to union members that don’t apply to any other organization. A business that belongs to a Chamber of Commerce, for instance, can’t opt-out of paying annual dues and still belong to the Chamber. Similarly, a shareholder in a corporation has absolutely no say in how that corporation spends money in politics. Essentially, paycheck deception laws say that the government has more say in how union workers spend their money than the workers themselves.

Paycheck deception laws have, and have always had, one purpose: attack unions. California school voucher activists who wanted to weaken the local teachers’ union first used paycheck deception as a tactic in 1998. These laws have always been about weakening unions and those who speak up for workers. They have never been about protecting workers or giving workers a “choice.”

Proponents call them “paycheck protection” laws. The people who push these laws want you to think these laws protect workers, when in fact they just protect the CEOs and special interests that don’t want any opposition from organized labor. The “protection” they are implying already exists, as union members already collectively decide how their money is spent. “Their transparent motive is not to protect workers, but to silence them by diminishing their collective voice,” wrote Joshua Rosencranz of the Brennan Center for Justice.

Paycheck protection laws are not “campaign finance reform.” Supporters of these laws often try to sell them as campaign finance reform. If anything, by forcing unions to follow one set of rules while ignoring corporations, these laws tilt the political playing field further toward corporate interests.

Union members already have a choice. No worker in the United States can be forced to join a union. Period. Furthermore, unions already have a process by which members can opt-out of having their dues used for political activity. As democratic organizations, union members already collectively decide how their dues money is spent—and like our elections, majority rules.

Union members are not calling for these laws. While arguing for paycheck deception in Missouri, legislators claimed they had talked to union workers who felt coerced by the current deduction process but failed to produce them. No union workers testified in favor of the Missouri bill. In fact, a recent Hart Research poll found that 75 percent of union members want their deductions to be used to advocate for the middle class in the political arena.

Paycheck deception laws hurt donations to nonprofits. By firing a broadside attack at unions, paycheck deception laws restrict all kinds of paycheck deductions: direct deposit, 401(k) and charitable deductions. Many union members voluntarily donate to organizations like the United Way through paycheck deductions—these laws would make that process more difficult.

Paycheck deception laws are often found unconstitutional. In Alabama, Arizona and Washington, paycheck deception laws were ruled unconstitutional by state Supreme Courts.The laws frequently violate the First Amendment—since union workers already have the choice to opt-out of their unions’ political activity. If Missouri passes this law, they will have to waste more taxpayer money defending it at court—they’ll probably lose.

Politicians admit that paycheck deception laws are a stepping stone to further union restrictions. Missouri Speaker Tim Jones admitted that while “there are other ways to skin a cat” to limit union workers’ political power, paycheck deception “a way to get to the ultimate goal of right to work.” Patrick Werner of the Koch-backed Americans for Prosperity also called paycheck deception a “first step” to making Missouri a “right to work” state.

So-called “right to work” laws ban fair share clauses in contracts, forcing unions to represent workers whether or not they pay dues—another tactic used to weaken unions.

Learn more at Progress MissouriBuilding the Middle ClassThe Brennan Center for JusticeNonprofit Quarterly and Mother Jones.

This article was posted on the AFL-CIO on March 15, 2013. Reprinted with Permission.

About the AuthorDoug Foote is the Social Media and Campaign Specialist at Working America. He joined Working America in 2011 after serving as New Media Director for the successful 2010 reelection campaign of Senator Patty Murray (D-WA).

Women Haven’t Gained A Larger Share Of Corporate Board Seats In Seven Years

Wednesday, December 12th, 2012

In addition to grappling with a persistent pay gap, working women also have to deal with extreme difficulty ascending to powerful corporate positions, according to a report by the research organization Catalyst. As Bryce Covert explained at The Nation:

Women held just over 14 percent of executive officer positions at Fortune 500 companies this year and 16.6 percent of board seats at the same. Adding insult to injury, an even smaller percent of those female executive officers are counted among the highest earners—less than 8 percent of the top earner positions were held by women. Meanwhile, a full quarter of these companies simply had no women executive officers at all and one-tenth had no women directors on their boards. […]

Did this year represent a step forward? Not even close. Women’s share of these positions went up by a mere half of a percentage point or less last year. Even worse, 2012 was the seventh consecutive year in which we haven’t seen any growth in board seats and the third year of stagnation in the C-suite.

Overall, more than one-third of companies have no women on their board of directors. But economic evidence shows that keeping women out of the board room is a mistake. According to work by the Credit Suisse Research Institute, “companies with at least one woman on the board would have outperformed in terms of share price performance, those with no women on the board over the course of the past six years.”

This post was originally posted on Think Progress on December 11, 2012. Reprinted with Permission.

About the Author:  Pat Garofalo is the Economic Policy Editor for ThinkProgress.org at the Center for American Progress Action Fund. Pat’s work has also appeared in The Nation, U.S. News & World Report, The Guardian, the Washington Examiner, and In These Times. He has been a guest on MSNBC and Al-Jazeera television, as well as many radio shows. Pat graduated from Brandeis University, where he was the editor-in-chief of The Brandeis Hoot, Brandeis’ community newspaper, and worked for the International Center for Ethics, Justice, and Public Life.

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