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Why $12/Year for Customers Means $12/Hour to Walmart Employees

http://www.occupydemocrats.com/12year-means-12hour-walmart-employee/

Five years ago yesterday, Lehman Brothers collapsed, which dramatically exacerbated a recession that had begun the previous year.

In the five years since the Lehman collapse, Media Matters noted: “Corporate profits have ballooned along with the soaring stock market. CNNMoney reported in December 2012 that quarterly corporate profits set a new record, but it also noted that workers’ wages had “fallen to their lowest-ever share of GDP.” When Business Insider reported on the same phenomenon in April, profitability had continued to rise as wages continued to fall. Wage growth has largely been captured by the highest earners.”

According to commentary by economist Jared Bernstein, “A Brief Post on an Obvious Point: The Poor Didn’t Do It!” “there has been a sharp increase in the official poverty rate over the great recession.” This graph, Bernstein provides, is from the Census Bureau.

The irony is that the Right blames poverty on the impoverished. Bernstein’s response “Listen, elites: you want less people on food stamps?  Fine…then stop screwing up the economy.  Then we’ll talk.  Until then—until we’re back around full employment, until you stop blowing bubbles, I really don’t want to hear from you about hammocks and the bad decisions of the poor.   You want to talk job creation, infrastructure investment, skills training, mobility, opportunity—I’m all ears.  Otherwise, quiet down and get to work.”

Democratic Mayor Vincent Gray, D.C., last week vetoed living wage legislation requiring big box retailers to pay a living wage of $12.50 an hour.  The bill would have raised the average workers wage about to about $26,000 a year from $17,000, which is only a couple of thousand dollars a year over the poverty level for a family of four.

Gray defended his decision in a letter: “the measure was ‘not a true living-wage bill,’ because its effect would be limited to ‘a small fraction of the District’s workforce.’ He called the bill a ‘job-killer,’ citing threats from Wal-Mart and other retailers that they would not locate in the city if the bill becomes law.”

According to the Washington Post, “Gray’s quandary is playing out in many U.S. cities, where local leaders who generally sympathize with worker causes are also eager to lure jobs and commerce for their constituents. Retailers, most notably Wal-Mart, have placed an increasing focus on urban expansion, while unions and advocates for workers have pushed measures like the District’s ‘living wage’ bill as a valuable hedge against the proliferation of low-paying jobs.”

Despite protestations to the contrary, Gray did not do his homework. Firstly, while supporter’s of the bill claimed they did not target Walmart, Walmart has been looking to expand into urban markets because its earnings and sales are down. So, there is a likely hood that Gray’s concerns were misplaced, especially if city officials nationwide did their homework, and considered the much over looked research.

There have been a number of comparison studies that show retailers like Costco, which pays a living wage, significantly more profitable then Sam’s Club, Walmart’s, membership retailer. While it is not my intention to get into the specifics, The Harvard Business Review published a study that concluded that Costco generated  an operating profit per hourly employee of nearly double that of Sam’s Club. “These figures challenge the common assumption that labor rates equal labor costs. Costco’s approach shows that when it comes to wages and benefits, a cost-leadership strategy need not be a race to the bottom.”

The model is there, but critics claim that Costco is a higher-end retailer—they  have  fewer skews, and command better prices, allowing them to choose to pay their employees more. Costco could clearly be more profitable if they paid their workers less. Costco has earned loyalty from its employees, as evidenced by its significantly lower turn-over rate than Sam’s Club, and it has policies in place that motivate employees to work harder, leading to greater customer loyalty and profitability.

Perhaps the most significant study, by the University of California, Berkeley Center for Labor Research and Education “LIVING WAGE POLICIES AND BIG-BOX RETAIL: HOW A HIGHER WAGE STANDARD WOULD IMPACT WALMART WORKERS AND SHOPPERS“, addresses the objections raised in the Costco model.

According to the study’s authors—“T/the growth of big box retail is a mixed blessing to local communities. There is strong evidence that jobs created by Walmart in metropolitan areas pay less and are less likely to offer benefits than those they replace. Controlling for differences in geographic location, Walmart workers earn an estimated 12.4 percent less than retail workers as a whole, and 14.5 percent less than workers in large retail in general. Several recent studies have found that the entry of Walmart into a county reduces both average and aggregate earnings of retail workers and reduces the share of retail workers with health coverage on the job. The impact is not only one of substitution of higher wage for lower wage retail jobs, but also a reduction in wages among competitors. As a result of lower compensation, Walmart workers make greater use of public health and welfare programs compared to retail workers as a whole, transferring costs to taxpayers.”

Significantly, Walmart’s entry into a metropolitan area drives down wages, increases the poverty level, hurting the poor and low-income consumers, while transferring social costs to the taxpayers.

The Berkeley study acknowledges claims that the Walmart model results in lower prices, which benefits the poor. “Emek Basker, cites a Pew Research Center Survey “to conclude that poorer consumers disproportionately benefit from Walmart’s lower prices. Jason Furman makes a similar argument, and further states that Walmart could not raise wages without raising prices which, he argues, would hurt poor and low-income consumers.”

In order to address these claims, the Berkeley researchers posed the following questions: “What if Walmart put in place a $12 per hour minimum wage for all its hourly employees in the U.S.? How much would it cost Walmart, and how much of the increase would benefit workers in poor and low-income families?

Their conclusion is astounding:

“We find that 41.4 percent of the pay increase would go to workers in families with total incomes below 200 percent of the federal poverty level (200 percent FPL). These poor and low-income workers could expect to earn an additional $1,670 to $6,500 (my emphasis) a year in income for each Walmart employee in the family, before taxes.”

Furthermore—“Even if Walmart were to pass 100 percent of the wage increase on to consumers, the average impact on a Walmart shopper would be quite small: 1.1 percent of prices, well below Walmart’s estimated savings to consumers. This works out to $0.46 per shopping trip or $12.49 per year (my emphasis) for the average consumer who spends approximately $1,187 per year at Walmart.”

It should be noted the authors indicate this is the most extreme estimate, since costs can be absorbed through increased productivity resulting from employee loyalty, or lower profit margins.

The bottom line—$12/year to you and me, means $12/hour to a Walmart employee!

Red States Receive the Most Disaster Aid and Send the Most Climate Deniers to Congress

http://www.occupydemocrats.com/extreme-weather-problem-despite-denials/

Daniel J. Weiss’ article for ThinkProgress.org “States That Get The Most Disaster Aid have Sent Dozens of Climate Deniers To Congress” provides alarming statistics about the danger and costs of Global Warming.

Weiss is a Senior Fellow and Director of Climate Strategy at the Center for American Progress (CAP). CAP is a progress think tank, whose logo reads “Progressive Ideas For A Strong, Just, and Free America.” So, on one level, we have a pretty good understanding of the organizations political vision, but Weiss is letting the statistics do his talking.

We, here at OccupyDemocrats.com, do not avoid political controversy, so I thought I would take a more direct approach to the political implications of Weiss’ article.

“The federal government spent nearly $62 billion for disaster relief in fiscal years 2011 and 2012, according to a new report from the Center for American Progress. And these federal funds only cover a portion of the price tag exacted by extreme weather; private insurance and individuals harmed by the events also spent billions of dollars.”

“In these two years alone, there were 25 severe storms, floods, droughts, heat waves, and wildfires that each caused more than $1 billion in economic damages, with a total price tag of $188 billion.”

Weiss tells us that of the ten states that received the most federal recovery money, “to cope with climate-linked extreme weather have federal legislators who are climate-science deniers…elected 47 climate deniers to the Senate and House.” What he doesn’t say is that of these 10 states, the only blue state is Illinois, and it has a Republican Senator Mark Kirk, who is a climate denier.  Interestingly, nearly two-thirds of the senators from these top 10 recipient states voted against granting federal emergency aid to New Jersey and New York after Superstorm Sandy.  Coincidently, nearly two-thirds of senators 14 out of 20 are Republicans, most of whom are climate change deniers.  It should be mentioned that when Hurricane Sandy hit the Northeast last year Bloomberg Businessweek declared “It’s global warming, stupid“, which undoubtedly influenced the direction of Republican votes.

Some Republicans may be getting the message. It seems they are slowly starting to recognize that there may be a danger here, since 97% of climate scientists are in agreement that anthropogenic (man-made) climate change is a concern. Of course there are also Republican science deniers, but Steve Benen writing for MaddowBlog, comments that Sen. Roger Wicker (R-Miss.) “realizes that conservatives tend to be at odds with the reality-based community when it comes to climate science, but he nevertheless hopes the latter will be “tolerant” of the former.  During a Senate Environment and Public Works Committee hearing on climate science, Wicker commented: “At the very least, I think it’s time for some tolerance in the public discourse regarding the many scientific viewpoints on climate change. Respect should be shown to those who have done the research and come to a different conclusion.”

Tolerance and respect asks Mr. Wicker, while; “more than one-third of the continental United States is suffering from severe, extreme, or exceptional drought as of August 27; the drought has shrunk available Colorado River water for cities dependent on it.”

Tolerance and respect asks Mr. Wicker, while; “the U.S. Bureau of Reclamation—the agency charged with managing water in the West—announced Friday [August 16] that it would cut the amount of water released next year by Lake Powell in Arizona by 750,000 acre-feet, enough to supply about 1.5 million homes.”

Tolerance and respect asks Mr. Wicker, while; “nationwide, nearly 35,000 wildfires have burned 3.9 million acres of land as of September 4, according to the National Interagency Fire Center. This includes the ongoing Rim fire in California, which has already burned an area the size of Chicago in and around Yosemite National Park.”

Tolerance and respect asks Mr. Wicker, while; the U.S. Forest Service, which receives 70 percent of federal fire-protection funding, has depleted its budget for wildfire response, forcing the agency to divert hundreds of millions of dollars from other programs to fight ongoing fires.

Tolerance and respect asks Mr. Wicker, while; “funding shortage exacerbated by the automatic across-the-board sequester budget cuts shrunk firefighting funds by five percent, forcing cuts of 500 firefighters and 50 engines.”  Obviously, the Right will blame the President because sequester was his idea.

I have written recently that I believe that one of the major reasons Global Warming has become a political hot potato is that we no longer speak the same language: “Positions on significant problems become very polarizing when you cannot agree on common vocabulary by which to discuss them. This issue of Climate Change is not an intractable philosophical problem.  However, when the parties to a scientific concern with the weight of Global Climate Change dig in, their positions become intractable and it makes intelligent rational decisions about our social, political, and economic interests impossible—but the danger does not go away.”

It is instructive to look at a couple of the reader’s comments at the end of Weiss’ article (all Right leaning folks).

An outright climate change denier believes that anthropogenic climate change is just not possible, and offers a metaphysical denial supported by misplaced scientific reasoning: “Are you people that naive enough to think we can literally influence the weather and stop mother nature from doing what she does. Over the last 15 years there has been no warming to speak of, it stopped even though Carbon output has went up. The arctic ice cap has grown 60% over the last year.”

Sounds as if  he listens to Rush Limbaugh who recently claimed on his radio show that there are metaphysical forces in control that humans cannot impact. As to the second part of this comment, I do not know if the Arctic cap has grown 60% over that last year, I guess I can look it up, but the issue for science is not that the icecap grows in Winter, but rather climate change scientists are concerned with how much it melts in warmer weather, causing rise in the oceans.

In another comment there is some obfuscated political nonsense: “There are, in fact, as many reasons to anticipate a period of global cooling as to forecast continued warming; the latter regrettably has become a platform for further increased gov’t command and control in the economy.”

Obviously, the Right’s obsessive belief that the goal of the Obama Administration is to take away ‘freedom’ and control the economy, but taken to the next level you get: ”Climate denier? What’s that supposed to mean? Nobody denies climate. Many sensible people reject the profit-driven ‘climate change’ hoax pushed by Warmers, tree-huggers, & snake-oil salesmen like Gore, Redford, & McKibben.”

This argument is more Republican obstructionist rhetoric, and hatred for anything perceived to be Progressive or from President Obama.  Since when is the Right critical of the profit driven motive? When, of course, the President, tree huggers, and/or people like Al Gore are the source of ideas.

One commentator must have heard Mr. Wicker’s comments: “Why can’t we monitor this a few more years – why do we have to do something now?”  Now, we don’t want to sway this person by the ‘fact’ that Climate Change has been a political football for 40 years or more, and that a near consensus of climate scientists (97%) presently think we have a problem.

Of course, comments on websites lure crazies from all over, but dangerously, this nonsense from the Right comes from the leaders of their party and the people they elect to represent them.

Tolerance is not an operative word, its passive. We are not talking about a benign philosophical discussion, late one night,  between a couple of undergraduates. Global Warming poses a real and great threat to our planet. Naturally occurring weather events, exacerbated by anthropogenic climate change are leading to more frequent disasters that are more costly than ever – $188 billion in 2011 and 2012. “This past June was the fifth-hottest month on record, and the first six months of 2013 were the “seventh warmest such period on record,” according to the National Oceanic and Atmospheric Administration. As of September 4, there were 44 presidential disaster declarations in 2013 due to climate-related extreme weather events. AON Benfield, a reinsurance company, estimates that extreme weather caused at least $32 billion in economic damages in the United States during the first half of 2013.”

Mr. Wicker is starting to believe there is a common language by which we can approach the problem of Global Warming, but: At what point Mr. Wicker does the urgency set in and enable us to stop tolerating the ‘misinformed’, and do something?

Chuck Todd Should Read the 1st Amendment: What You Report or Don’t Effects People’s Lives!

http://www.occupydemocrats.com/chuck-todd-needs-read-first-amendment-constitution/

The First Amendment to the U.S. Constitution— Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

Most of us believe in the right to free speech, but we quibble over what it means, e.g., almost nobody believes that you have the right to scream fire in a crowded theater, but we will argue over whether the burning of the flag is an expression of free speech.  Similarly we have a common understanding of what freedom of the press means, we disagree over whether or not the press is objective in its reporting.

Edmund Burke is credited with coining the term and claiming the press as the ‘Fourth Estate’, what I will sometimes refer to in this piece as the ‘mainstream media’.  Its traditional role is to be an institution that checks and balances those in power. Our media market today as become very polarized. There is a current belief that the mainstream media is biased towards a liberal world view. In response, the market has given us ‘Conservative’ talk radio and Fox ‘News’.

In a post yesterday Charles Johnson said “There’s a feeling among many people I know that the US media has almost completely lost the thread, abdicating their responsibilities by reporting falsehoods as truth, refusing to fact-check, and generally treating journalism as a horse race in which the only thing that matters is who wins.”

NBC host Chuck Todd, rightfully, took a lot of heat when he made this statement during an appearance on Morning Joe: ”it’s not his job to point out lies about the Affordable Care Act, because that would be helping President Obama by ‘selling’ it… During that segment on ‘Morning Joe,’ former Pennsylvania Gov. Ed Rendell (D) speculated that most opponents of the Affordable Care Act have been fed erroneous information about the law. Todd said that Republicans ‘have successfully messaged against it’ but he disagrees with those who argue that the media should educate the public on the law. According to Todd, that’s President Barack Obama’s job.”

Statements like this show  Todd’s willingness to try and justify abdication of his responsibilities as a member of the mainstream media–perhaps he should become a commentator or political pundit.  In an attempt to deflect some of the heat, he immediately defended himself on twitter:

The problem for Todd is that his name appears next to the NBC logo, not Fox (more on Fox later). NBC professes to be a member of the Fourth Estate. Nobody asked Todd to promote White House policy, he volunteered a point of view, in which he wrongly claimed that it is not the media’s job to correct GOP falsehoods. With regards to his short-sighted utilitarian analysis of the situation, I do see a correlation between telling the truth and not telling the truth as having an implication for the liar. I fail to see, however, how that absolves you of your responsibility to seek the truth. Isn’t the GOP one of those centers of power that you are mandated to watch?

Todd did make specific reference to Obamacare, then we have every right to ask: Is this claim policy specific? And, if so, then who determines, which policies it’s okay to lie about, if they go unchecked by those with an opposing point of view?  In any case, according to Todd, unchecked lying is something we have to live with, because for the mainstream media to challenge a lie, is to advocate for the other side.

There is a confluence of events that follows media reports–what these folks report influences people who vote, and that ultimately influences the direction of policy, which ultimately influences the quality of peoples lives. Since most citizens do not have the time to spend looking into and do not have direct access to the goings on, in the centers of power, they rely upon the press to keep them informed. It follows that there is a huge responsibility placed upon the press in its role as the Fourth Estate, which it has chosen to accept– to be accurate and as factual as possible.

A side note: according to Webster a ‘fact’ is defined as something that truly exists or something that has actual existence. A fact, then is a true piece of information that is distinct from an opinion or a falsehood. If that is the case about the nature of facts, then one of the lesser well-known facts is that a fact, is a fact, in a red state and a blue state. Simply put 2+2=4 in both New York and Mississippi.

The press frequently remains ‘passive’ believing that if it presents the views of all parties to an issue, then it is meeting its mandate to be fair. Its viewers/readers can make up their own minds from the conflicting points of view as they are presented. The back and forth might make for great television ratings, but not all points of view are factual.

The problem with a passive role is that fairness is often conflated with being factual. In other words, just because the press gives equal voice  (in terms of time) to opposing sides, does not mean that the press is facilitating a factual account of that which is being discussed—both sides could be wrong or lying, or one side can just be plain right.

However, being proactive can be equally dangerous.  Take Fox ‘News’, an organization, which despite its protestations to contrary is biased in its reporting, and is a clear advocate for the Republican point of view.  Bret Baier hosted a proactive piece, a special advocating legislation against the SNAP program, which if adopted could knock nearly 3.8 million people off of food stamps. The center piece of the Baier obfuscation is Jason Greenslate, a surfer and now star of the Fox anti-SNAP campaign. It appears Greenslate may have bilked the system, and abused the food stamp program.  It does not matter to Fox that he is an outlier, and that SNAP is a very important program, which helps an enormous number of people in great need.

It does not matter to Fox, that the USDA, the administrator of the Food and Nutrition Service, reports that: “Due to increased oversight and improvements to program management by USDA, the trafficking rate has fallen significantly over the last two decades, from about 4 cents on the dollar in 1993 to about 1 cent in 2006-08 (most recent data available).”  One percent in government waste is nearly unheard of.

There is further deceit to this story. Baier is one of the few Fox personalities with a reputation as straight-shooting, “a down-the-middle avatar of fairness notwithstanding…The Great Food Stamp Binge shows that he’s just as capable of the sort of partisan chicanery the cable news-watching world has come to expect from the uniformly conservative, pro-GOP Fox News commentary division.”  Now we come to learn that Baier proactively advocates under the banner of journalistic integrity. I guess, as opposed to passively advocating, like Mr. Todd.

Whether sitting back and passively letting the truth be misrepresented, or proactively putting forth a misleading and dishonest agenda (while representing yourself as ‘an avatar of fairness’) is an unforgivable abdication of responsibility. Fox is not regarded as a member of the Fourth Estate, so they do not surprise us.  However, NBC is a member, and if it going to live up to its mandate as a member, its journalists need to live up to their responsibility and integrity. They are obligated by the requirements of journalistic integrity to let their audience know– somebody is lying about the facts.

It is particularly egregious in the case of Obamacare because there is no substantive alternative policy—opposition is a bunch rhetoric and fear mongering, in attempts to keep the public misinformed.  Todd is complicit in that effort by refusing to call out what he acknowledges to be lies.

Postscript: As I mentioned, what the media reports effects the lives of people. Yesterday, (September 19) the House voted down the SNAP appropriations bill, citing the concern for abuse. Many Congresspeople noted they were influenced by Fox misinformation, in Baier’s piece. Fox, apparently, circulated this piece in Congress.  This vote could leave nearly 5 million people hungry. Given all the misinformation Fox supplied Romney, you would think the Republican Congress might do some independent investigation. I guess, the job description for Republican staffers is to watch Fox, in order ‘to inform’ the Congressperson for whom they work. In defense of Fox, of course, they are not member of the Fourth Estate, but a response too it!

Postscript Two: Today the Republican controlled House voted to shut down the government unless Obamacare is repealed. In less then 24 hours the House of the People has voted to take away the people’s food and their healthcare.

Greedy Conservative Millionaires and Billionaires are Coming After your Pension

http://www.occupydemocrats.com/riches-beyond-the-dreams-of-avarice/

For months during last year’s presidential campaign, there was much said about the Republican tax plan and its creative inaccuracy that was satirized by President Clinton, in his terrific speech at the Democratic National Convention that become known as… “It’s arithmetic.”

At the same time, there were a number of threats by Republican Oligarchs against the job security of their employees over Obamacare, and now their cause du jour is pension reform.  What these CEO’s all have in common besides their hatred for the President is that they are either billionaires or billionaire wannabes.

In a post yesterday by Pulitzer Prize winning author Gary Cohn, “A Hedge-Fund Billionaire From Texas is Waging War on California Pensions”, brings to the our attention the efforts of John Arnold and The Arnold Foundation, a Texas based foundation which according to Cohn “is clearly in the forefront of nationwide efforts to scale back pensions for state and municipal workers.”  Arnold sponsored a secret pension summit along with David Koch, at which they had their representatives and representatives of several California based secular and religious based organizations whose mission is to privatize pension plans under the guise of fiscal responsibility.  They attempted to suggest despite its secrecy that it was a bi-partisan gathering of the fiscally concerned. The token democrat was San Jose Mayor Chuck Reed, who has opposed same-sex marriage and the raising of minimum wage and now he is a pension-cutter.

“The current system has allowed politicians to promise one level of benefits without fully funding them,” the Arnold Foundation’s McGee told Frying Pan News in an email last week. “Across the U.S., state and local governments have underfunded workers’ benefits by at least $1 trillion.” McGee added that: “We discussed the need to deal responsibly with accumulated pension debt, secure benefits that have already been earned, and create a system that is affordable, sustainable, and secure.”

There is no question that reform is necessary because some of the pension funds that rely upon investment to fund future liabilities have had difficulty.  CalPERS is the giant investment fund that supports California’s public employee retirement system and its ability to do that has a lot to do with how well it does with its return on investments. According to its mission statement “CalPERS has generated strong long-term returns by effectively managing investments to achieve the highest possible return at an acceptable level of risk. CalPERS portfolio is diversified into several asset classes, so any weaknesses in one area are offset by gains in another. The Board follows a strategic asset allocation policy that targets the percentage of funds invested in each asset class.” There are obvious concerns given significant unfunded liabilities that CalPERS succeeds in its mission. To protect itself, California under Gerry Brown has implemented contentious pension reforms, with claims for exemptions now making their way through the Courts.

A former professor, a secular Conservative for whom I have great respect, once said to me “that it is a silly way of living to aim at amassing vastly more money than one would possibly need, but a lot of people live silly lives.” It is hard to believe that Arnold, Koch, Adelson, and the Waltons, just to name a few are silly rich, and in the words of my professor, continue to live silly lives.

These Republican Oligarchs have “riches beyond the dreams of avarice”, a well-known line uttered by Dr. McCoy in Star Trek IV,  but actually attributed to the 18th Century poet and essayist Samuel Johnson. It is a wonderful quote, which is poetic in its flow.  Avarice according to Webster means an ‘insatiable desire for wealth or greed’– Johnson is trying to tell us that certain people have a desire for riches beyond their dreams for greed.

These folks are not civic minded and not concerned about unfunded pension liability. It is not likely that any municipality’s inability to meet its pension demands will affect any of these people directly. It is much more likely they just want to generate more access to more income and wealth. Given the conservative nature and mission of organizations like CalPERS, these Right wing Oligarchs have limited access to the pension fund’s billions. They are looking for the pension fund equivalent of deregulation, in order to complete their access to the middle class’s money that began with the repeal of Glass-Steagall.

What is really behind the Right’s push for pension reform advocated by former San Diego Republican mayoral candidate, San Diego City council member Carl DeMaio, who is also a Fellow at the libertarian leaning Reason Foundation, and attendee at the Arnold Foundation secret meeting, has been a push to replace San Diego city employees’ pensions with a 401(k)-type substitute. It sounds like simple Arithmetic—a whole lot less concern about underfunded pension commitments, and unrestricted access for the Arnold’s of the world to the billions in more business for his Hedge Fund and Wall Street.

The Right’s Corporatist Nonsense Regarding the Minimum Wage

http://www.occupydemocrats.com/author/steven-bernstein/

In January during his State of the Union Message, President Obama called for a rise in the federal minimum wage from the current $7.25 per hour to a new rate of $9.00 per hour.  As a percentage increase, most working folks would be euphoric over a 24% increase. Think about it, though, with a 24% increase this person would now earn, as a full time employee, about $18,720 a year—no doubt without vacation pay and without healthcare benefits. Furthermore, if this person was supporting a family, this person would still earn nearly 24% less than the current federal poverty line for a family of four of $23,050 per year.

Of course Republicans immediately denounced this proposal, claiming that raising the minimum wage would hurt and not help the poor, because employers would cut back labor and reduce hours.  Really!  These jobs are service jobs, and they are labor intensive, and it’s not likely that say McDonalds, though I am sure some enterprising student in robotics might disagree, is going to be able to satisfactorily replace the person that says ‘can I take your order, please’.

On August 30 (USA Today) ”Workers at McDonald’s and other fast-food chains conducted strikes and walkouts in nearly 60 cities Thursday, hoping for super-size wage hikes that for many would boost their hourly pay to $15 from the current federal minimum $7.25.”  The rallies that were held in about 60 cities throughout the United States, Reuters called “the largest protest of an almost year-long campaign to raise service sector wages.” “The bottom line is we are doing this to let the corporations know we want $15 an hour, better working conditions — and we want to be treated fairly, ” said the Rev. W.J. Rideout III of Detroit’s All God’s People Church.

Not surprisingly, the Republican mouthpieces were out in full force. During Mark Levin’s August 30 radio show he claimed “McDonalds in under attack.” Old Rushmo had this to say the same day: “It is not a legitimate protest, it is a protest by the left—a rent a mob type of thing, in order to advance the leftist agenda with Obamacare.”  Let us not forget the WSJ’s Steve Moore who on Sept 1 told Fox News “to say goodbye to the $1.00 menu items at Wendy’s, McDonalds, and BurgerKing…a rise in minimum wage will lead to higher prices…the unemployment rate would go up…the last time [we had a rise in the minimum wage] we saw an increase in the unemployment rate of teenagers and unskilled workers…and it can destroy their jobs…a machine could ask you if you want fries.” I guess he knows that robotics student!

The Houston Courier today; “The cost of every product includes the cost a business has in making that product,” says Kevin Price, host of “Price of Business” on Business Talk 1110 KTEK . Price is also a guest on national media including Fox Business and Fox News. Price feels that businesses will work around the minimum wage — “entrepreneurs are entrepreneurial in all their activities,” he says. “When forced, they’ll make accommodations” and often the people the government wants to help most are adversely affected by increased prices and a cut-back in their hours.

I am not sure what the Republican apoplexy is all about, because workers are part of the free-market, which is the holy grail of their economics. If the workers prevail through organization and negotiation, and burgers become $4 instead of $2, then you would think the Right would happily either pay the new price, or stop eating burgers. In either case they should embrace the market working.

That being said, there is discussion about the amount of the increase from $7.25 to $15/hr, a more than 100% increase. There is significant evidence that a sustained and consistent increase in the minimum wage does not effect the unemployment rate, and will not ultimately hurt those the policy is trying to help. An increase, however, to $15/hr might hurt those it is trying to help.

In a blog post a few months back, Economist Jared Bernstein writes “Richard Freeman, the godfather of labor economics, once told me that one reason minimum wage increases don’t have the job loss effects their opponents predict is because the political process disallows increases that would be large enough to trigger such effects.”  Bernstein points out the move to $9.hr discussed by the president has significant historical data to support this increase: “it’s also the case that federal increases dating back to the 1950s are surprisingly log-linear meaning that the wage floor has generally been increased by the similar nominal amounts in percentage terms (changes in natural logs approximate percent changes).

Economist Dr. Frank J Lysy, Ph.D. and former member of the World Bank Group—Chief Economist and Director of the Economics and Policy Group of the Multilateral Investment Guarantee Agency (MIGA) in his blog March 6, 2013 “The Impact of Increasing the Minimum Wage on Unemployment: No Evidence of Harm” takes a look at the research and concludes that a there is no evidence of harm with consistent and rising minimum wage.

In a recent interview on CNBC with Jared Bernstein, Larry Kudlow says of the strike: “People don’t normally see fast-food restaurants as end-all, be-all jobs. These jobs are temporary in nature, geared more toward those in high school, or to help students get through college. Therefore, a one or two dollar increase could help, but some form of specialized trade training as vocational training or community college studies would provide more of a long-term benefit to the average worker…the market is all about the employers and employees coming together, evaluating skills, evaluating supply and demand and deciding among themselves what the right value proposition is. If we enact a higher minimum wage, it will hurt entrepreneurs, and hurt the very low-wage and unskilled workers it’s meant to protect when the jobs go to higher-skilled workers, I pads and robots. Kudlow also knows that robotics student too!

Bernstein responded to Kudlow: “I looked at the numbers before I came over here, and if you look at the population of people who earn less than ten bucks an hour, and that’s who we’re talking about, 88% of them are adults; 44% of them have at least some college education; half actually brings home half of their family’s earnings, so I think the image that you have in your head of a teenager at an entry-level job doesn’t apply to the folks on the street today.”

In fact in a recent post on Occupy Democrats, Fox News interviewed Boloco CEO John Pepper, who has a chain of 22 burrito shops told FOX Business host Stuart Varney that his company manages to pay entry-level workers between $9.50 to $11 an hour, and a number, which he hopes to increase in the near future. Some of his wage earning employees already make up to $17 an hour. While Right-wingers like Varney are obsessed with keeping labor costs down and sucking the most productivity out of workers as possible, this CEO says that paying employees a humane and living wage pays off with a more productive staff and improved attracting and retaining of talented workers who can inspire loyalty in customers. “It’s a lot easier to keep wages down than it is to find better practices, bolder practices, more efficient practices, which come through training,” says Pepper. “We’re constantly looking for practices and ways to bring wages up.”

Consider, in a post shortly after the president’s State of the Union call for an increase in the minimum wage the Huffington Post wrote: ”The minimum wage should have reached $21.72 an hour in 2012 if it kept up with increases in worker productivity, according to a March study by the Center for Economic and Policy Research. While advancements in technology have increased the amount of goods and services that can be produced in a set amount of time, wages have remained relatively flat, the study points out. Even if the minimum wage kept up with inflation since it peaked in real value in the late 1960s, low-wage workers should be earning a minimum of $10.52 an hour, according to the study” and they would still have incomes below the poverty level.

The ‘Right-to-Work’ Lie Being Shamelessly Perpetrated by the Corporatist ‘Right’

http://www.occupydemocrats.com/the-lie-being-perpetrated-by-the-right-that-is-right-to-work/

A catchy name;  ’Right-to-Work’ law, it would seem implementing such a law would benefit workers. I mean, the state is saying that people living in it have the right to work, but it is legislation that actually undermines the worker. It prohibits agreements between labor unions and employers and denies collective bargaining rights. It denies the union’s ability to enter into agreements with employees to become members of the union as a condition of employment, and so it leaves employees without union representation and protection. Workers are left at the mercy of their corporate masters.

Right-to-work laws are actually union busting pieces of legislation passed under the guise of helping workers, enacted by Republican held legislatures, to help the corporate interests that sponsor them. And, these corporate interests are backed by organizations like: [The]National Right to Work Legal Defense Foundation, Inc., whose logo says it all: “Defending American workers from the abuses of compulsory unionism since 1968.” Then there are the infamous Koch brothers. The Kochs deny any involvement in the recent move by Wisconsin Gov. Scott Walker’s to balance the budget on the backs of labor, denying unions that represent public workers collective bargaining rights. However, what Koch does acknowledge on their website KochFacts.com, is that “Koch has always and will continue to support market-based policies that advance economic freedom, and we support candidates who do the same. This was the basis for Koch’s support of Gov. Walker’s candidacy.” I gather for Koch, supporting workers is not a market-based policy as workers are, apparently, not part of the free market. Sounds like code for support for Walker’s corporate sponsored union busting policies.

There is ALEC, (American Legislative Exchange Council), a Koch sponsored 501(c)3 tool, whose advisory council consists of members from big Phrma, AT&T, Energy, Exxon, UPS, to name a few, and the likes of Reagan era economist Arthur B. Laffer, and whose board is largely made up of Republican legislators. ALEC is at the forefront of right-to-work policy writing legislation on behalf of many states, which as a matter of public policy they deny (see Center for Media and Democracy).  Additionally, if you type ‘right-to-work’ in the search window on ALEC’s website, the first item that comes up is a May 23, 2013 report co-written by Laffer and Stephen Moore, of the WSJ —a report on ‘Rich States, Poor States’.  It is not surprising that the top 10 rich states are all right-to-work; Red states, and the bottom 10 poor states are Blue, which do not have right-to-work laws on their books. It is a disingenuous report because it ignores the states’ GDP. The aggregate GDP in 2010 of the top 10 states on Laffer’s list, is a little over $2.2 trillion.  Just California and New York, which are among the bottom 10– 47 & 49 on the list, have a combined GDP of nearly $3.1 trillion.

In fairness to Laffer et al, their study is based upon 15 economic policies that they claim determine the economic strength of a state. Not surprisingly, 10 of the 15 are in some way related to taxation. And of course, one of the 15 is determined by whether or not the state has a right-to-work statute—I gather the market value of the goods and services that a state produces is not a significant policy consideration, in determining the economic prowess of that state.

New Hampshire, the ‘live free or die’ state, has a political alliance called; “Live Free or Die Alliance” (NH’s Virtual Town Hall).  As you may recall, in 2011, New Hampshire’s mostly Republican legislature passed HB 474 prohibiting collective bargaining agreements in an attempt to add it to the list of right-to-work states. Fortunately, it was vetoed by then Gov John Lynch, and withstood an attempt to override the veto by the legislature. Lynch has been succeeded by now Gov Maggie Hassan, also a Democrat, so it is not likely to be an issue again for a while. What is disconcerting is that for the Right in general, and New Hampshire in particular, ‘live free or die’ means that corporate interests are prior to the individual’s right to protection, as an employee.  We, of course, learned last election cycle that corporations are people too.  Who is it that is living free and willing to die for the loss of freedom?  The Live Free Alliance thanks its corporate sponsors on the top of its website—Credit Suisse, Bank of America, First Republic Bank, and Waste Management just to name a few.

Yesterday, in a piece on Plunderbund.com GOP Legislators told to wait on ‘Right-to-Work until after John Kasich is reelected governor.  “We heard rumors that Ohio’s GOP legislators were told to hold off on pushing so-called ‘right-to-work’ legislation until after the 2014 election to keep Kasich from having to take a stance on the issue.”  In a recent interview with the Delaware Gazette, State Rep Andrew Brenner admits the rumors were true.  Brenner said, “I’m co-sponsor on three bills, and I’m told I’m on a wanted poster in one of the union halls. There’s right-to-work for private, public and a resolution to put it on the ballot. I don’t think any of them are going anywhere. We were told not to even bring them up, because next year is an election year for the governor. This may come up if he’s re-elected. If he’s not re-elected, it won’t come up because we won’t get it through Ed FitzGerald.”

It is apparent that Kasich, who presents himself as a moderate, has not given up on his anti-worker agenda. He and his party are simply ‘lying in wait’ for the outcome of the next election. If, as the policy hawks on the Right claim, right-to-work policy is good for the worker, and is, as Laffer and Moore argue, among the primary reasons for growth in the top 10 states on their list—Why is Kasich running from the policy and lying in wait? My suggestion is that while workers and corporations are both people, folks that work have the advantage–they know better and they vote.