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“Corporate Wage Hike Subsidities”: CEOs Call For Wage Increases For Workers! What’s The Catch?

Peter Georgescu has a message he wants America’s corporate and political elites to hear: “I’m scared,” he said in a recent New York Times opinion piece.

He adds that Paul Tudor Jones is scared, too, as is Ken Langone. And they are trying to get the Powers That Be to pay attention to their urgent concerns. But wait — these three are Powers That Be. Georgescu is former head of Young & Rubicam, one of the world’s largest PR and advertising firms; Jones is a quadruple-billionaire and hedge fund operator; and Langone is a founder of Home Depot.

What is scaring the pants off these powerful peers of the corporate plutocracy? Inequality. Yes, amazingly, these actual occupiers of Wall Street say they share Occupy Wall Street’s critical analysis of America’s widening chasm between the rich and the rest of us. “We are creating a caste system from which it’s almost impossible to escape,” Georgescu wrote, not only trapping the poor, but also “those on the higher end of the middle class.” He issued a clarion call for his corporate peers to reverse the dangerous and ever-widening gulf of income inequality in our country by increasing the paychecks of America’s workaday majority. “We business leaders know what to do. But do we have the will to do it? Are we willing to control the excessive greed so prevalent in our culture today and divert resources to better education and the creation of more opportunity?”

Right on, Peter! However, their concern is not driven by moral outrage at the injustice of it all, but by self-interest: “We are concerned where income inequality will lead,” he said. Specifically, he warned that one of two horrors awaits the elites if they stick to the present path: social unrest (conjuring up images of the guillotine) or (horror of horrors) “oppressive taxes” on the super rich.

Motivation aside, Georgescu does comprehend the remedy that our society must have: “Invest in the actual value creators — the employees,” he writes. “Start compensating fairly (with) a wage that enables employees to share amply in productivity increases and creative innovations.” They have talked with other corporate chieftains and found “almost unanimous agreement” on the need to compensate employees better.

Great! So they’ll just do it, right? Uh… no. But he says he knows just the thing that’ll jar the CEOs into action: “Government can provide tax incentives to business to pay more to employees.” That’s his big idea. Yes, corporate wage-hike subsidies. He actually wants us taxpayers to give money to bloated, uber-rich corporations so they can pay a dab more to their employees!

As Lily Tomlin said, “No matter how cynical you become, it’s never enough to keep up.”

First of all, Georgescu proposes this tax giveaway to the corporate elite could “exist for three to five years and then be evaluated for effectiveness.” Much like the Bush tax cuts that helped drive the economic divide, once the corporate chieftains get a taste for a government handout, they will send their lawyers and lobbyists to Washington to schmooze congresscritters into making the tax subsidy permanent.

Secondly, paying to get “good behavior” would reward bad behavior, completely absolving those very CEOs and wealthy shareholders of their guilt in creating today’s gross inequality. After all, they are the ones who have pushed relentlessly for 30 years to disempower labor unions, downsize and privatize the workforce, send jobs offshore, defund education and social programs, and otherwise dismantle the framework that once sustained America’s healthy middle class. These guys put the “sin” in cynical.

If we want to fix income inequality, Larry Hanley, president of the Amalgamated Transit Union, has a solution. In response to Gerogescu’s offer of charity to corporations, Hanley wrote: “Strengthen labor laws, and we can have democracy and equality again.”

 

By: Jim Hightower, Featured Post, The National Memo, August 26, 2015

August 27, 2015 Posted by | CEO'S, Corporate Welfare, Wages, Working Class | , , , , , , , | 1 Comment

“I’m Down With The Trends”: Jeb Bush Wants To Be The Uber Candidate. Here’s The Problem With That

Jeb Bush is desperate for you to know that he is the Uber candidate. The old, 20th century ways are not for him and his bold campaign for the future. He’s sharing a ride to the glorious tech-driven tomorrow.

But what does that actually mean? So far he hasn’t said, but he’s certainly getting the coverage he wants.

The front page of today’s New York Times features a photo of Bush in an Uber car, over a story about Republican candidates embracing the company. It summed up the purpose fairly well:

Republican candidates are embracing Uber not just as a paragon of their free-market ethos and distaste for entrenched, government-protected industries, but also as an electoral strategy for building bridges to traditionally Democratic cities, where the company has thrived. During his visit to the left-leaning city of San Francisco on Thursday, Mr. Bush was ferried around, fittingly, by an Uber driver, who deposited him at a campaign event in a black Toyota Camry. “Thanks for the ride!” Mr. Bush hollered as cameras snapped away.

So what exactly is Jeb trying to communicate about the kind of president he’d be? On the surface, it’s entirely substance-free. It’s just about attitude: I’m hip to what the kids are into, I’m down with the trends, I’m forward-thinking. In that spirit, Jeb took to LinkedIn and mobilized a phalanx of Silicon Valley clichés to proclaim that his economic ideas are super-futuristic.

In a post entitled “Disrupting Washington to Unleash Innovators,” he went on and on about how liberals just want to crush innovation with their dastardly regulations, while he…well, he actually didn’t say anything about what sorts of policies he would pursue as president, other than to proclaim, “I’ve got a different view on things, and a different approach. I don’t mind disrupting the established order.” Ooo, did he say “disrupting”? How disruptive!

The truth, though, is that the president of the United States has no power to influence municipal disputes over taxi regulations, so there is approximately nothing Jeb will do as president to affect the regulations that govern Uber and other ride-sharing companies. And if you don’t feel at least somewhat ambivalent about Uber in particular, you haven’t been paying attention.

On one hand, the company provides a service that people find invaluable, and the local taxi regulations it fights against are often ridiculous (side note: despite the conservative assumption that the government “closest to the people” is the best government, it’s often local governments that are most corrupt and have the most onerous and illogical regulation). On the other hand, Uber’s leadership is apparently a bunch of arrogant jerks whose business model is built around moving into a new market, blatantly breaking the laws that restrain their ability to operate, and then trying to build pressure to get the laws changed. (Catherine Rampell lays out some of these issues well in today’s paper.)

In any case, one thing the federal government does have power over — and thus something Jeb Bush would have the ability to affect if he becomes president — is labor standards, and that’s a genuine policy dispute worth exploring. If Jeb’s right and more and more people will be earning income from companies like Uber, how should they be treated? What standards will apply to them? How are these workers going to obtain the things we ordinarily associate with a job, like health insurance, retirement savings, or paid leave?

Bush hasn’t spoken to these issues yet, but I’m pretty sure I know what his position is: the market will work everything out, and government just has to get out of the way. But we already have evidence that in some ways this approach is screwing more and more people over. It may or may not be appropriate to consider someone driving for Uber part-time to be an employee of the company, but what about a case like FedEx, which for years classified thousands of its full-time drivers as “independent contractors,” meaning the company didn’t have to pay payroll taxes or overtime, and could evade all sorts of other labor regulations? The company suffered a series of losses in court over the issue, and just settled a lawsuit by drivers in California for $228 million. Does Bush think they were in the right, and other companies should be able to just reclassify workers whenever they want?

That’s an example of what the Obama administration is trying to address with a new guidance the Labor Department just released to employers. It says in effect that you can’t just take an ordinary employee who works only for you and has all the conditions of their work controlled by you, and say, “You’re now an independent contractor” and thereby evade all your responsibilities as an employer. This kind of mis-classification has spread to all sorts of industries, with millions of employees finding themselves with fewer benefits, lower incomes, and less protection than the law says they ought to have. Hillary Clinton has endorsed the administration’s effort to crack down on mis-classification, but as of yet the Republican candidates haven’t addressed it. It’s no mystery what they’ll say, though: this is just more government meddling in the market.

There’s a lot more we should hear from Clinton on this topic and how it relates to companies like Uber, particularly since she’s the one more inclined to have government respond to the ways our economy is changing. In her economic speech Monday, she mentioned it briefly, saying: “This on-demand, or so-called gig economy is creating exciting economies and unleashing innovation. But it is also raising hard questions about workplace protections and what a good job will look like in the future.” Which is perfectly true, but it doesn’t tell us what in particular she thinks government ought to do to protect workers as the economy transforms.

I’m sure she’ll have more to say on the subject, and perhaps in response Jeb Bush can explain why government has gone too far out of its way to ensure that workers get a fair shake. Or he might even surprise us and offer a program of smart, nimble regulations that would allow innovative new models of work to flourish while still protecting people from exploitation. But until he says otherwise, we have to assume that Bush’s answer to the question of what government should do to respond to economic changes that can make workers more vulnerable is: “Nothing.”

 

By: Paul Waldman, Senior Writer, The American Prospect; Contributor, The Plum Line Blog, The Washington Post, July 17, 2015

July 19, 2015 Posted by | Jeb Bush, Overtime Pay, Workers | , , , , , , , , | Leave a comment

“A New Meaning Of Volunteerism”: Wisconsin Lawmaker Wants To Take Away Workers’ Weekends

Wisconsin state Sen. Glenn Grothman (R) is pushing to undo the state’s law that employers have to provide their employees with at least one day off a week, the Huffington Post reports.

The Huffington Post obtained an email Grothman sent to other state lawmakers on Friday in which he proposes legislation that “would allow an employee to voluntarily choose to work without one day of rest in seven.” State Rep. Mark Born (R) is sponsoring the legislation in the state Assembly.

Wisconsin is somewhat unique in having the law on its books. “Right now in Wisconsin, you’re not supposed to work seven days in a row, which is a little ridiculous because all sorts of people want to work seven days a week,” Grothman told The Huffington Post. But workers don’t have to get a day off every seven days, as they could work for up to 12 in a row “if the days of rest fall on the first and last days of the 2 week period,” according to the law. Grothman called the law “goofy” and called undoing it a matter of “freedom.”

While he argues that the law would ease workers’ ability to work overtime, it’s possible that employers would force their employees to work the extra time, making it less than voluntary. “It’s a very hard thing to know whether something is truly voluntary or not,” Vice President of the Economic Policy Institute Ross Eisenbrey told the Huffington Post. “If the employer puts pressure on people and lets them know they will be unhappy if workers exercise their right to have a day off, that might be enough so that no worker ever does anything but volunteer to work seven days a week.”

In fact, the power usually lies with employers and instances of them abusing labor laws are already on the rise. In 2009, two-thirds of low-income workers said they had experienced a wage law violation in the previous week alone. Wage theft, where an employer illegally withholds overtime pay or makes its employees work off the clock, robs low-wage workers of more money than is stolen from banks, gas stations and convenience stores combined. Actions filed in federal court alleging wage and hour violations increased by 400 percent between 2000 and 2011.

And the law doesn’t always come to workers’ rescue. In California, workers recovered less than half of what was taken from them from 2008 to 2011, and, worse, 83 percent of those who actually proved a case of wage theft still never got what they were owed.

American workers already put in more hours and are guaranteed less time off than most other developed peers. We work more than in any other industrialized countries. Unlike in the United States, it’s illegal in six of the 10 most competitive countries in the world to make workers put in more than 48 hours a week. The United States also lacks laws guaranteeing that workers can take time off if they or their family members are sick, will get vacation or holiday time off, or can take paid time off for the arrival of a new child. Many other developed and competitive countries, on the other hand, do guarantee these things.

Grothman would also go further and take away the national holiday for government workers on Martin Luther King, Jr., day. He was a sponsor of the country’s first preemption bill that blocked cities and local communities from enacting paid sick days legislation in Wisconsin.

 

By: Bryce Covert, Think Progress, January 5, 2014

January 7, 2014 Posted by | Wages, Wisconsin | , , , , , , , | Leave a comment

   

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