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Americans’ Net Worth

5:01 pm in Uncategorized by Donald Goldmacher

This entry was written by Heist Co-Producer and Co-Director Frances Causey.

A recent report that the economy contracted the last quarter is no surprise. Despite the recent numbers, we consistently get rosy reports from the mainstream media that the economy is generally improving. But the reality is that tens of millions of Americans have never been less secure financially because the current economy leaves them out in the cold. The numbers never lie.

From 2007 to 2010, the median net worth of each middle class American family dropped by nearly 40%, wiping out 18 years of accumulated wealth. The housing crash contributed to most of the losses. In that same period, middle-class families went from having on average $126,400 to $77,300. Median income for middle class families is now about where it was in the mid-1990’s. These are stunning losses (not JUST a number) and not without severe consequences, particularly when one considers the psychosocial impact to families. The 1% had big losses too during the crash but they were significantly less impacted because their assets were more diversified. Yet consider this. The earnings of the top 1.0 percent grew a staggering 134% between 1979 and 2007 while those in the bottom 90% grew just 15%.

So where are working Americans suppose to make up for their losses? Apparently not by working. Most of the jobs lost in the economic collapse were replaced by low paying jobs with no benefits. One of the most astonishing numbers consistently left out of the national debate is how 40 million good jobs with benefits were lost well before 2007. These also were replaced with low paying, low-skill service jobs. And yet somehow we continue to think this restructuring of the American economy that began in the late 1970’s when Democrats and Republicans alike began to worship at the altar of free market utopianism is good for us.

Since the late 1970’s average workers have faced historic obstacles in the search for decent employment. Current forecasts suggest there will be protracted unemployment for years to come. To put it bluntly, there is little doubt (and Washington knows this) that the living standards of a majority of working Americans will continue to decline over the next decade.

Even many relatively high tech manufacturing jobs today are paying just $10-12 an hour. In a recent 60 Minutes/CBS News story the reporter filed a piece on the subject of how American manufacturing cannot find enough skilled workers to run their factories. The piece profiled several workers who went back to school to get the necessary training. And guess how the worker is being rewarded for her initiative? She is being paid $12 per hour! Yet the reporter never questioned the employer about the low wages he pays for his “skilled” workers. And American employers wonder why there is a dearth of candidates applying for these positions? These are not living wages when a gallon of milk costs $5. Workers simply can’t afford to take these jobs and support their families.

Yet, without rebuke from the people who elected them, politicians on both sides of the aisle continue to cry about a worker “skills gap”. Just recently, a bi-partisan group of Senators, guided by an addiction to the belief that the market always knows best, just sided 100% with multinational corporations against American high-tech workers by proposing a bill that would overhaul the high-skilled worker visa program. The bill would immediately increase the cap on temporary H-1B from 65,000 to 115,000 a year, giving guest workers an advantage of American workers. How are American workers of any skill level ever able to compete again with the deck so stacked against them?

We hear everywhere that we are in a “recovery” citing the fact that our economy is “growing”. But since the economic collapse, our Gross Domestic Product is consistently averaging around 2.5%. But that number is not high enough to create enough jobs for those job seekers entering the market for the first time much less the millions who need jobs but cannot find them.

Which brings me to another narrative waffling out there. A favorite mantra of the corporate and Wall Street class, and Tea Party is that America is a “welfare state”. Out of work Americans are taking too many handouts and after all “enough is enough.” A closer look at the numbers bearing reality reveals a much different truth. If readers will recall, President Clinton “reformed” welfare in 1996. To receive cash assistance or Temporary Assistance to nearly enough to meet even the most basic of needs. TANF’s role in providing income support to families has declined dramatically since 1996 yet the need has never been greater. For instance in 2011, only 27 families received TANF for every 100 families in poverty.

If the working poor are on Medicaid its because employers like Wal-Mart don’t offer health care. If the working poor participate in SNAP or the food stamp program its because they are not paid enough by employers like Wal-Mart to feed their families. Since 2007, over 12 million families have lost their homes to foreclosure. As of January 2013, another 11 million are underwater on their mortgages and in serious jeopardy of default. Yet, there are currently 1.2 million people in public housing, hardly a huge number given the number of families displaced by the housing crisis. But yet we hear the constant refrain from those who have never wondered where their next meal was coming from complain that our working poor are consistently “on the take”. Corporate or white collar welfare in the form of subsidies, low tax rates for corporations and wealthy individuals, and the auctioning of public resources like oil, timber and the public airwaves for pennies on the dollar costs taxpayers ten times what blue-collar welfare does.

So what is the solution? Profits are not the problem. Blind, relentless pursuit of them at any cost by any business small or large is. American style Democracy has always been grounded in the fact that a majority of America’s citizens worked hard and shared in her prosperity. American worker productivity has never been higher yet American workers are not seeing any return. So we have to make “work” pay again in this country. But how do we do that? If we truly grasp and follow the current numbers, we need a revolutionary change in what’s left of our Democracy.

Through organizing and grassroots efforts, we must rally those left behind in this economy and acting in unison, reconstruct our economy by rebuilding from the bottom up and pressuring those at the top to change policy. This means strengthening the power of workers wherever we can, through workplace laws, policy and unions, which remain the only institutional hedge against the power of Wall Street. Moreover, we must realize that our problems are not just about electing the next politician. Perhaps we even need to redefine the American Dream into one that is more inclusive of all.

This entry is also available at Daily Kos.

Dear Mr. Speaker!

4:46 pm in Uncategorized by Donald Goldmacher

This entry was written by HEIST co-director/co-producer Frances Causey.

In opening the 113th Congress last Thursday House Speaker John Boehner declared that debt is imperiling the American Dream. This is the kind of intentionally misleading narrative Republicans, in collusion with corporate America and conservative think tanks, have spent 40 years and billions of dollars developing. Unfortunately, the old adage rings true that if you repeat a lie enough it becomes fact.

First, Speaker Boehner you are a bit confused about debt. And so are you Mr. President. Debt is not stealing the American Dream. Corporate America and its political collusion with Democrats and Republicans are. But lets cut to the political-economic quick America, we have one political party-the corporate party.

Look to any primer on debt provided by progressive economists like Dean Baker who predicted our economic collapse. According to Baker, the housing collapse, brought on by reckless Wall St. financial scams (think sub-prime mortgage and collateralized mortgage backed bonds), sank the world economy –and the steps that government took to counter all of this—created the preponderance of our debt. According to Baker this is indisputable. Many other economists like Robert Kuttner also echo this.

In 2007 the budget deficit was just 1.2 percent of gross domestic product output, a very reasonable amount. According to the Congressional Budget Office, this year’s deficit will measure 7.3% of GDP. So the increase in the public debt since 2007 can be squarely placed at the foot of Wall Street. Financial corporations (Countrywide, etc.) peddled “debt” to those who could least afford it, those who yearned for their slice of the American Dream-owning a home. Even former Treasury Secretary Hank Paulson admitted in a 2009 Vanity Fair article that he and his Wall Street cohorts said housing would continue to go up in value. But Conservatives love to blame the victims as part of their narrative in order to rally their base, which conveniently believes that personal debt caused our current troubles. Nothing could be further from the truth. Just ask Senator Elizabeth Warren who studied this extensively while at Harvard. I think it’s more plausible to blame those at the top of the pyramid who knew exactly what they were doing.

But tell that to Speaker Boehner and the “fix the debt” Corporate CEO’s who apparently were inspired by the guy who got us into this mess in the first place- Alan Greenspan! So instead of fixing the roots of the problem, which is corporate control of politics and the economy, these corporate acolytes want to instead swoop in and fix (in the coming negotiations over extending the debt ceiling) what ain’t broke, which is Social Security and Medicare!

In his speech Speaker Boehner said that if we “free ourselves from our debt“ (read that: reduce the social safety net) our economy will be set free and jobs will come home. Oh the hypocrisy! You know as well as anyone, Mr. Speaker, that most manufacturing jobs are not coming back to America.

Jobs are leaving America because you, at the behest of the corporations, passed laws that made exporting jobs incredibly profitable. Those laws are enabling 70 U.S. based corporations to not pay taxes on over 1.2 TRILLION in profits around the world.

In his remarks, Speaker Boehner cites that debt is “draining free enterprise”. Corporate profits have never been higher, but nor has inequality, a fact you will never hear from the Speaker. Work no longer pays in America. The game is fundamentally rigged and ordinary people who do everything right, who play by rules, still end up with the short end of the stick.

But make no mistake, the corporate party knows there is plenty of prosperity in America-it’s in the hands of the 1%. Investors all over the world are plowing into U.S. Treasury bonds, signaling a federal government nowhere near default. CEO’s know this, politicians know this and Wall Street investors know this but the media doesn’t, or at least doesn’t understand or acknowledge it, and therefore most Americans don’t either. I call it media free of fact.

But the reality Mr. Speaker, one that working Americans feel in their guts everyday, is that since the great collapse- created by corporate domination of our political economy-trillions in housing wealth has been lost, millions of families lost their homes to foreclosure, many millions more are underwater, millions remain out of work and over 46 million Americans live poverty. But you and your colleagues continue to play political games at the public’s expense and pander to the corporate elite who elected you. You can change that, by overseeing a government that represents ALL OF US, not just its profit at any cost corporations.

This entry is also available at Daily Kos.

The Silent War Against Workers by Big Business Is Growing Louder!

7:07 pm in Uncategorized by Donald Goldmacher

Siblings Alice Walton and Jim Walton

This entry was written by Frances Causey.

Thankfully, stories of striking workers at Wal-Mart and Hostess are making the front pages of newspapers and leading the “A” blocks of cable news shows. These two companies epitomize the war against workers that began over 40 years ago. Wal-Mart is the poster-child for corporate malfeasance and draconian worker policies. Wal-Mart workers on average are paid so little that the American taxpayer is literally subsidizing these workers as tens of thousands of them have no health benefits which forces them to use state Medicaid for healthcare. Wal-Mart made $15 billion dollars last year. Four out of the America’s top ten Billionaires are Wal-Mart heirs.

Its no better over at Hostess, a company that has been bought and sold three times since the 1980’s, putting the Twinkie maker in debt but making Wall Street investment bankers and top management a bunch of dough (sorry). And guess who bankrolled those deals? Fees and stock deals were funded by employee layoffs! But the biggest ding-dong of all would be the current Hostess CEO who while decrying striking workers for wanting livable wages and benefits gave himself a 300 percent raise.

The American worker-those who live off a paycheck – has experienced “death by a thousand cuts” over the last forty years which we amply portray in HEIST. Despite slick corporate press releases regurgitated by corporate owned media, workers at Wal-Mart and Hostess have been forced to rise up because they can no longer support their families with what they EARN. Forty million good paying jobs with benefits have been shipped overseas or dismantled by corporations since the late 1970’s and were replaced by low wage service jobs with no benefits.

Simply put, working for a living no longer pays for most workers in this country. Incomes in America are much lower than is widely understood. Pulitzer-Prize winning reporter David Cay Johnston crunched the numbers in Heist. One-third of jobs in America pay less than $15,000 a year, which includes part time workers and people with two small jobs. But half of Americans make less than $25,000. Three quarters make less than$54,000. Ninety-nine percent of workers make less than $250,000 per year. HEIST describes the corporate makeover of big government that saw the Democratic Party become almost indistinguishable from Republicans on economic matters. Policies were developed that clearly favored the “capital” class not the “working” class.

American style Democracy has been unique for one simple reason: a majority has- for the most part- benefitted from the fruits of the nation’s labors. But this is no longer true as the workers at Wal-Mart and Hostess know all too well. With nowhere to go, these brave workers are fighting back and making great strides in raising the nation’s consciousness about economic inequality. We must support them! So if you live in a city where Wal-Mart workers are striking, go there this Friday, black Friday, and instead of shopping, take striking workers a sandwich, a bottle of water or give them a pat on the shoulder or a word of encouragement. These workers are “walking the walk”!

For more information on the Wal-Mart workers’ strike, check out forrespect.org Read the rest of this entry →