“It’s Not Just About Burger Flippers”: A Preview And A Parable, McDonald’s And The Fate Of The Middle Class
In recent weeks fast-food workers have staged dramatic one-day strikes in cities across the country, demanding a $15 starting wage, instead of about $8 on average at places like McDonald’s. The strikes have prompted much debate about fast food and the cost of a Big Mac. But this moment isn’t just about burger-flippers—it’s about the realization that the American middle class has been hollowed out to the point of decimation. Today, one in four jobs is low-wage, and at current pace it will be one in two jobs by 2024—which means that what fast-food companies pay people today will affect us all.
Companies like McDonald’s may protest that their margins are too thin, their workforces too transient to justify a $15 minimum wage. Yet in other countries the company pays exactly that wage and manages to make profits while charging only a few cents more for burgers. In this sense, fast-food workers are like water drops on a hot griddle: once they’re vaporized, everyone else is about to get cooked. And as these strikers are now showing, more and more low-wage workers in America, even ones that aren’t unionized, are tired of being vaporized.
A $15 minimum wage is the key building block to “middle-out economics” (a concept I’ve helped shape, along with my co-author Nick Hanauer). Middle-out economics, as opposed to trickle-down, says that the best job creator is a healthy middle class with the purchasing power to generate and sustain demand. It says – as Henry Ford figured out a long time ago – that workers aren’t costs to be cut; they are customers to be cultivated. Investing in that middle class makes more sense than expanding tax breaks for the wealthy.
A middle-out policy agenda includes a more progressive tax system, but also focuses on high-skill education and fostering more entrepreneurs. And it crosses left-right lines: after all, the rock-bottom wages of a “free enterprise” like Wal-Mart leads to more “big government” spending on food stamps and Medicaid. A $15 minimum wage would take tens of millions off the dole and turn them into more robust consumers and less dependent citizens.
The fast-food strikes have framed the issue and are a sign of a reorganization of labor itself. Because traditional unions now cover only a tiny slice of the private workforce, new forms of organized, joint action are emerging to pressure employers for a better deal, such as coalitions of domestic workers in various states, or advocacy centers for oft-abused guest workers.
Too many American think that the plight of the low-wage worker has nothing to do with them. In fact it is both a preview and a parable. The fate of the middle class rests, in part, on whether more Americans learn to see the fate of fry cooks as their own.
By: Eric Liu, Time Magazine, August 7, 2013
“A Very Cynical Strategy”: Having Never Tried, Republicans Want Jobs To Stay Anemic
Job-growth is sputtering. So why, exactly, do regressive Republicans continue to say “no” to every idea for boosting it — even last week’s almost absurdly modest proposal by President Obama to combine corporate tax cuts with increased in spending on roads and other public works?
It can’t be because Republicans don’t know what’s happening. The data are indisputable. July’s job growth of 162,000 jobs was the weakest in four months. The average workweek was the shortest in six months. The Bureau of Labor Statistics has also lowered its estimates of hiring during May and June.
It can’t be Republicans really believe further spending cuts will help. They’ve seen the effects of austerity economics on Europe. They know the study they relied on by Carmen Reinhart and Kenneth Rogoff has been debunked. They’re no longer even trying to make the case for austerity.
It could be they just want to continue opposing anything Obama proposes, but that’s beginning to seem like a stretch. Republican leaders and aspiring 2016 presidential candidates are warning against being the “party of ‘no.’” Public support for the GOP continues to plummet.
The real answer, I think, is they and their patrons want unemployment to remain high and job-growth to sputter. Why? Three reasons:
First, high unemployment keeps wages down. Workers who are worried about losing their jobs settle for whatever they can get — which is why hourly earnings keep dropping. The median wage is now 4 percent lower than it was at the start of the recovery. Low wages help boost corporate profits, thereby keeping the regressives’ corporate sponsors happy.
Second, high unemployment fuels the bull market on Wall Street. That’s because the Fed is committed to buying long-term bonds as long as unemployment remains high. This keeps bond yields low and pushes investors into equities — which helps boosts executive pay and Wall Street commissions, thereby keeping regressives’ financial sponsors happy.
Third, high unemployment keeps most Americans economically fearful and financially insecure. This sets them up to believe regressive lies — that their biggest worry should be that “big government” will tax away the little they have and give it to “undeserving” minorities; that they should support low taxes on corporations and wealthy “job creators;” and that new immigrants threaten their jobs.
It’s important for Obama and the Democrats to recognize this cynical strategy for what it is, and help the rest of America to see it.
And to counter with three basic truths:
First, the real job creators are consumers, and that if average people don’t have jobs or good wages this economy can’t have a vigorous recovery.
Second, the rich would do better with a smaller share of a rapidly-growing economy than their current big share of an economy that’s hardly moving.
Third, that therefore everyone would benefit from higher taxes on the wealthy to finance public investments in roads, bridges, public transit, better schools, affordable higher education, and healthcare — all of which will help the middle class and the poor, and generate more and better jobs.
By: Robert Reich, Robert Reich Blog, August 3, 2013
“The Character Of The Caucus”: Thanks To Republican Intrasigence, It’s All About 2016 Now
It wasn’t the House Republicans’ refusal to take up the president’s jobs plan before the last election. Or their reckless games with the debt ceiling when Paul Ryan’s budget called for trillions in fresh debt itself. Or House intransigence when it comes to the Senate’s bipartisan immigration fix. Or even its recent call to nix high, common school standards.
Not that these steps weren’t awful. But somehow they could be put down to “normal” petty politics. The “out” party never wants the jobs picture to improve before an election. The debt ceiling is one of a handful of “forcing devices” that pols of all stripes seize on in a town where nothing really has to happen. One can argue that immigration reform isn’t as urgent as, say, jobs. And stoking phony fears of a federal school takeover is the oldest slander in the book (never mind that these “common core” standards were adopted by states voluntarily, and that the world’s top-performing school systems all have something like them).
No, what finally made me lose it was House Republicans’ warped obsession with Obamacare. This fixation showcases so many noxious traits simultaneously that it reveals the ultimate character of the caucus.
At bottom, Obamacare is a moral assertion that it is wrong when a wealthy nation has 50 million people without health insurance, when medical bills are a leading cause of bankruptcy for families and when millions of luckless souls are unable to get coverage because they have preexisting conditions. The House GOP today says these are not real problems.
Obamacare addressed these problems with precisely the mechanism that conservative thinkers and Republican policymakers favored (subsidies to buy insurance from competing private carriers with a requirement that everyone be in the insurance pool). Yet the House GOP effectively has said: Even if you adopt the approach our party favors for a problem we used to say was real — a problem that our presidential nominee addressed successfully in his state — we still can’t be with you. We have to damn you as un-American. We have to deceive the public about your aims and methods. We have to do everything in our power to stop you from using our preferred approach to bring a measure of security to the middle class.
It’s the most perverse, irredeemable bait-and-switch since Lucy pulled the football away from Charlie Brown. Even Lucy didn’t do it 39 times.
I’ve long been a critic of the House GOP. But something in their poisonous Obamacare stance has made me snap. It’s one thing to think you can’t do business with these people. It’s another to realize these people aren’t operating in the same moral and economic universe.
So here we are. The only question for those seeking American renewal is what will break this gridlock. The only certain answer is that the president’s speech Wednesday will not. Obama is calling for an economy built from the “middle out” (hats off to progressive activists Nick Hanauer and Eric Liu, who pushed this smart messaging so relentlessly for two years that it’s become the official Democratic creed).
By: Matt Miller, Opinion Writer, The Washington Post, July 24, 2013
“Blessed Are The Rich”: Charles Koch Is Such A Clueless Visionary
One thing I’ve come to value in the last couple of years is the altruism and keen economic insights of the fourth-richest man in America: Charles Koch.
Even though Koch was raised rich and has now amassed a personal fortune of about $34 billion, he recently gave us a deeper sense of his true worth, measured not in dollars, but in values.
“We want to do a better job of raising up the disadvantaged and the poorest in this country,” he declared. Excellent thought — FDR couldn’t have put it better! Noting that a big problem for the poor is that the Powers That Be “keep throwing obstacles in their way,” Koch cut to the chase, saying, “We’ve got to clear those out.”
Yes, Charlie, I’m with you! Clear out such barriers as the offshoring of middle-class jobs, union busting, poorly funded schools and the lack of affordable health care, housing and child care.
But, alas, that’s not at all what Koch had in mind as obstacles to be cleared out. Rather, he proposes to “help” poor people by eliminating — ready? — “the minimum wage.” Why? Because, explains this clueless son-of-the-rich, having a wage floor “reduces the mobility of labor.”
In case you don’t dwell in the plutocratic, narcissistic, Ayn Randian fantasyland where the Kochs hang out, “labor mobility” is right-wing psychobabble for social Darwinism. Remove all remnants of America’s economic safety net, they coldly theorize (while wallowing in their nests of luxury), and the poor will be “freed” to become billionaires.
As Charles puts it, if the disadvantaged had no protections in the workplace and no government programs to ameliorate their poverty, they would then have to scramble just to live, thus freeing them from reliance on society’s helping hand. Freeing them to do what? Well, Koch says, they could then “start a business … drive a taxicab … become a hairdresser.”
What a visionary he is! Where you and I might see people trapped in debilitating poverty, Charles sees a Brave New World of billionaire hairdressers!
But he’s not the only 1-percenter having utopian visions for hard-hit Americans. For example, I can’t begin to tell you how grateful America’s homeless people are going to be once they hear about Andy Kessler, who has been thinking long and hard about their plight, selflessly seeking ways to eradicate intractable poverty.
Kessler is a former hedge-fund whiz, which means he was in the business of making … well, money. Beaucoup bundles of it. But having seen his 16-year-old son volunteer at a homeless center, he was motivated to develop a plan to solve homelessness — and here it is: Stop dishing out soup to those people, and shut down all those damn shelters!
The homeless problem, he recently wrote in an op-ed piece for The Wall Street Journal, stems from “all this volunteering and charitable giving” by do-gooders like his son. Homeless folks ought to be working, he lectured, but they’re not, “because someone is feeding, clothing and, in effect, bathing them.”
Golly, Andy, I recall that Jesus said something about our Godly duty to feed and clothe the needy — and even to wash the feet of the poor.
But apparently, Jesus just didn’t grasp the essence of true morality. “Blessed are the rich!” is Kessler’s spiritual mantra. “Where does money come from … to help the unfortunate?” he asked. And yea, I say unto thee, the Holy Hedge-Funder answered his own deep question: It comes from “someone (who) worked productively and created wealth.”
Thus, he sagely concluded, the answer to poverty, to truly helping the poor, is not to pamper the takers, but to provide more tax breaks for the makers of wealth (like him) — the ones who produce “good old-fashioned economic growth.”
Wow, what a role model this guy is for America’s youth — including that misguided boy of his! Wouldn’t you like to buy Andy and Charles for what they’re worth … and sell them for what they think they’re worth? That would fund a whole lot of homeless programs.
By: Jim Hightower, the National Memo, July 24, 2013
“Congress Reinterprets Jesus”: Serve Banksters Or Serve The Poor?
Thank God for Congress, right? When things get out of balance in America, we can always count on our legislative stalwarts to recalibrate the scales of justice.
Take greed, for example. The barons of Wall Street, whose raw greed and casino scams wrecked our real economy five years ago, are back to shoving great gobs of bonus pay into their pockets. Meanwhile, the middle class remains decimated, and millions of workaday Americans who were knocked all the way down into poverty are still stuck there. In this nation of fabulous wealth, our poverty numbers are shocking and scandalous: 50 million people are officially poor; another 51 million are “near poor.” A third of our country!
You’ll be pleased to know, then, that only last week, U.S. House members turned their legislative guns on the greed that’s sapping the moral vitality of our society. Unfortunately, their aim was a bit off. Instead of popping the privileged, they hit the most unprivileged: families who need food stamps to make ends meet.
The food stamp program is out of control, they shrieked, noting that it’s been expanding even as the unemployment rate has been coming down. Yoo-hoo, knuckleheads, the jobless rate has ticked down largely because job-seekers have become so discouraged by the absence of opportunities that they’ve quit looking. Plus, getting a job no longer gets you out of poverty — just ask the barista who’s making your next latte about the joys of working for poverty pay. Food stamp rolls have reached record numbers, because — guess what? — there are record numbers of Americans in poverty!
Yet, the House called for cutting some $2 billion a year (and 2 million Americans) out of the program. On June 20, however, the members balked — not because the cut was too severe, but because it was not enough for Tea Party Republicans, who have been demanding a total food stamp gut job, proposing to slash the program by $25 billion a year.
Also, the GOP majority lost the votes of nearly all Democrats by adding a couple of fiendish amendments to punish poor people for the crime of being poor. One was to put additional work requirements on families seeking the food benefit. “We cannot continue to deny able-bodied people the dignity of work,” blathered a worked-up know-nothing named Steve Southerland of Florida. Then, Rep. Michele Bachmann had a tempest in her teapot of a brain, offering her support of Southerland’s amendment in a sort of Biblical falsetto: “If anyone will not work, neither should he eat.”
Hello, Michele — that’s not exactly in keeping with the moral message of the Biblical Jesus. Nor is it in keeping with reality — today’s poverty does not stem from any unwillingness to work. Indeed, millions of food stamp recipients are working, but not being paid enough to put adequate groceries on the family table. And many more are in desperate search for jobs that aren’t there.
In fairness, though, let me note that House Republicans did try to give hard-hit families something extra in this legislation: drug testing. Following in lockstep with the Koch-funded American Legislative Exchange Council — which has been peddling this vile, insulting slap at poor people all around the country — the House majority added a urine-test provision to its bill. That really puts the mean in “demeaning” — and this from small-government poseurs who piously decry government intrusion into people’s lives!
Once again, the Tea Party congresscritters should have used their ever-present Bibles for instruction, rather than just for thumping. They would’ve learned that Jesus, at the Sea of Galilee, distributed free fish and loaves to everyone there — with no pee-in-the-cup requirement. And if he had wanted to test whether anyone was on drugs, he would’ve passed cups to bankers first, then to lawmakers.
A society’s response to poverty is one measure that speaks directly to its essential character. In particular, a wealthy society’s nonchalant tolerance of poverty in its midst, the willingness of that society’s leaders to disregard the spread of poverty and the callous calculations by some that it is permissible and even profitable to denigrate those mired in poverty — these are three flashing indicators of a meltdown in our society’s moral core.
By: Jim Hightower, The National Memo, June 26, 2013
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