Week In Review October 27

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Oct 272014

onaschoutsmall  by Bill Onasch

Just Cause For Firing
The Bureau of Labor Statistics has released their Usual Weekly Earnings Summary for the Third Quarter of 2014. The median weekly pay for the 107.9 million full-time employees–ranging from domestic service to corporate CEO–was 790 dollars. That means half of those working full-time for a regular boss earn less than that figure.

The stats for part-time wage employees have some interesting twists. The median weekly wage for the 24 million part-time workers over age 16 was 245 dollars. But, in striking contrast to full-time workers, women in all color/ethnicity groups except Latino earned more than men in their category. Asian women did the best with 274 a week. And among men both Asians and Latinos outperformed whites. Perhaps there is literature explaining this anomaly but I haven’t seen it.

My guess is that women stay in these jobs longer than men and their higher wage reflects incremental longevity raises. Some, especially single mothers, may stick with part-time because its flexibility allows them to schedule doctor and teacher visits. They are also less likely, of course, to get the relatively more attractive job offers available to their male coworkers eager to escape from the involuntary working part-time category.

For different reasons related to immigration, Asian and Latino men may also make do longer in part-time, low wage jobs.

The BLS survey does not include millions, like my hard working wife Mary, who are self-employed. Most agricultural workers and all members of the armed forces are also excluded.

Nearly half of all retired workers, including me, depend on Social Security as our sole source of significant income and it is an essential part of the budgets of most of the other half. Last week it was announced that we will get a 1.7 percent cost-of-living raise in 2015. This will bring the average monthly benefit up to 1,328 and the maximum benefit to 2,663. (The max is received by about ten percent whose income exceeds the ceiling for payroll tax deductions, going up next year to 118,500.)

David Cay Johnston, who won a Pulitzer Prize for investigative reporting while at the New York Times, and now teaches the history of business, tax and property law at Syracuse University, takes a more comprehensive look in a perceptive opinion piece on the Aljazeera America site, Compensation shrinks for all income groups – except the very highest. He opens,

“American paychecks shrank last year, just-released data show, further eroding the public’s purchasing power, which is so vital to economic growth. Average pay for 2013 was $43,041 — down $79 from the previous year when measured in 2013 dollars. Worse, average pay fell $508 below the 2007 level, my analysis of the new Social Security Administration data shows. Flat or declining average pay is a major reason so many Americans feel that the Great Recession never ended for them. A severe job shortage compounds that misery not just for workers but also for businesses trying to profit from selling goods and services.”

(Note the difference in the average measure compared to the median used by the BLS.)

This bad news has impact beyond the borders of the USA. Since World War II, the American market, both consumer and capital, has often been key to the health of other industrialized and emerging countries as well. The European Union is facing a real threat of a Triple Dip Recession and even the once white hot industries of China and Brazil are cooling down too.

Johnston has done a diligent job in presenting a picture of stratification of wages and salaries of all 155.8 million in the USA who had at least some paid work in 2013, after combing the best available source–Social Security records. The one encouraging trend he noted was that this total labor force was up 2.1 million from 2012. Still, even this improvement over recent years didn’t keep up with the 2.4 million growth in population last year.

The average per capita wage declined 1.8 percent from 2000 to 2013. During this same period the Gross Domestic Product increased 11.6 percent.

According to Johnston’s analysis, 61 million–nearly forty percent of all jobs–pay less than 20,000 a year. Even a single person will have trouble getting by on such paltry wages but many of these workers are principal bread winners for families.

Johnston thinks capitalist greed may have harmed even ruling class interests. He writes,

“The overall decline in purchasing power per American is a major factor in the recent drop-off in corporate profits, which had been soaring since the recession officially ended on June 30, 2009. At Walmart, McDonald’s and other companies that sell to workers in the bottom half or even the bottom 90 percent, corporate financial reports show eroding conditions, with profits falling and debt rising. This is the inevitable and unavoidable result of pay and jobs not growing in tandem with the economy, especially the increases in productivity that in the postwar era used to be shared by investors and workers.”

He has a point. To a certain extent wage-cutting is a double-edged sword. Even the global giant Walmart–that vanquished the old dime stores, sent Montgomery Ward to its demise, and humbled Sears through a combination of low prices and even lower wages–is being pestered by the “dollar stores” aiming still lower that have become hot investments.

But companies such as General Electric, Caterpillar, and Boeing are making enormous profits even as they ruthlessly drive down labor costs. The auto industry–both “domestic” and “foreign” owned–are doing quite well replenishing aging cars despite recalls of millions of defective, unsafe vehicles. German, Italian, Japanese, Korean and even Russian companies are increasingly taking advantage of the high skilled, very productive, relatively low wage American workforce to acquire or build plants in a number of industries in the USA. Some American companies, for the same reason, are “in-sourcing” work they once offshored.

The WIR is not the proper format for theoretical debates about under-consumption versus over-production or about the tendency of falling rate of profit. I think we can safely conclude that no significant part of the ruling class–which today has a global agenda–thinks substantial raises in wages will help their bottom line. In every industrialized and emerging country–with the possible, partial exception of China–the bosses continue to aggressively extract take-backs from private sector workers and impose heartless austerity in the public sector.

Johnston concludes his article,

“We can do better than this. We can elect leaders who favor broad prosperity through time-tested principles that encourage investment in economically productive activities rather than in financial speculation and unproductive assets such as mansions and yachts, that favor domestic jobs rather than offshoring, that restore bargaining power to workers and that recommend major new public investments that will make the economy more efficient and expand the knowledge base from which wealth creation springs. America will remain in the economic doldrums until our political leaders recognize these trends and use their power to change them or until we fire them at the ballot box.”

Like so many who sometimes offer useful analysis Johnston demonstrates the deeply ingrained naivete about how the political side of political economy plays out in the real world. He believes the system is sound but just takes some shaking to bring its leaders to their senses.

President Obama–who I have often described as the most reactionary President in living memory–has called for an increase in the minimum wage to 10.10 an hour. That’s about 21,000 a year for a full-time worker. That might lead to a modest boost for Walmart and McDonalds but would mean little for construction or manufacturing. But even this token is unlikely to be granted.

It certainly is getting no attention in the heated Midterm elections. Most Democrats are distancing themselves from the President; some won’t even admit to ever voting for him. Never has there been any less choice between these two parties owned lock, stock, and barrel by bosses and bankers. And never has there been such public disgust with both parties, and all branches of government, as being registered in polls today.

So how do we fire them? As long as those responsible for our “doldrums” maintain a tight monopoly of all things political how do we bring about meaningful change for the working class majority? If there’s any kind of lesser evil today it surely is the petty partisan gridlock that has so far prevented President Obama from making a Grand Bargain that would gut our few remaining social benefits such as Social Security, Medicare, and Medicaid.

Next time, on the eve of the election, I will review what I think is needed to deal with the class behind the dummies competing for our favor.

That’s all for this week.
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Check out our digest of news stories about working class and climate issues, posted Monday-Friday by 9AM Central. on our companion Labor Advocate blog.

Our sole source of operating income is reader contributions. If you can help please visit the KC Labor Donate page.

Bill Onasch is a paid up NWU member

Bill Onasch is a paid up NWU member

Week In Review October 21

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Oct 212014

onaschoutsmall  by Bill Onasch

Class, Color and Ebola
Today, Aljazeera America reported,

“Former Cuban leader Fidel Castro said in a letter published Saturday that his country would send an additional 460 doctors and nurses to West Africa, where nearly 4,500 people have died from Ebola and another 5,000 have been infected. The team of medical personnel will join the 165 Cuban doctors and nurses who are already in Sierra Leone to help fight the epidemic. …Jorge Perez, the head of Cuba’s top tropical medicine institute, told The Associated Press that Cuba is ready to send still more doctors if there is enough funding and infrastructure to support them.”

Despite their small size, and difficult economic situation–resulting from the more than half-century long embargo on trade and travel imposed by the United States–this commitment is greater than that so far made by the USA. It graphically illustrates a major fundamental difference between the two governments.

Unlike Washington, Havana doesn’t view health care as a commodity, or foreign policy leverage. Cuba trains lots of doctors and nurses to provide free care to both their own people and unselfishly to others in need as well. When an uninsured Black man, recently returned from west Africa, showed up at a Dallas hospital emergency room with a fever and other symptoms consistent with Ebola, payment protocol initially sent him home with a bottle of Tylenol and instructions to drink lots of water. When finally later admitted he was too far gone to save.

Ebola is not a new disease. It was first identified in south Sudan in 1976. As “development” pushed bats thought responsible for spreading the virus to primates and humans in to populated areas there have been a number of major outbreaks in several African countries over the past 38 years. But there has been no available treatment drugs or preventive vaccines for this affliction with a very high mortality rate.

While there is clearly demand for such medicine it is not what economists call effective demand. Ebola country is the poorest region on Earth. Big Pharma is reluctant to invest in research and development for customers who can’t generate the obscene profits they have come to expect. Modest efforts have been slowed in this country by the bipartisan agreed cuts and sequestration in agencies regulating needed testing before new medicine can be approved for human consumption.

Since Ebola was thought to be Africa’s problem there has been little or no training of health professionals in this country and little thought given to the facilities needed for Ebola patients or protective gear for those caring for them either. But in a global economy Africa’s afflictions eventually wind up in the “advanced” countries–even in the heart of Texas.

One of the first Americans to contract Ebola was a registered nurse. National Nurses United quickly surveyed their members and found out just how unprepared hospitals and clinics were. NNU co-president Deborah Burger writes,

“NNU is calling for all U.S. hospitals to immediately implement a full emergency preparedness plan for Ebola, or other disease outbreaks. That includes

* Full training of hospital personnel, along with proper protocols and training materials for responding to outbreaks, with the ability for nurses to interact and ask questions
* Adequate supplies of Hazmat suits and other personal protective equipment
* Properly equipped isolation rooms to assure patient, visitor, and staff safety
* Proper procedures for disposal of medical waste and linens after use

“NNU is also calling for significant increases in provision of aid, financial, personnel, and protective equipment, from the U.S., other governments, and private corporate interests to the nations in West Africa directly affected to contain and stop the spread of Ebola.”

Such demands may seem self-evident common sense. But the commodity health system that has come to be the biggest industry in capitalist America seldom voluntarily spends a penny simply because it obviously makes sense. We are all fortunate to have the nurses union on our side until we can establish a health system focused on human needs such as the Cubans have done.

The Nuclear Option In Philadelphia
Perhaps the parents of the Governor of Pennsylvania were fans of the science fiction daily television serial that I loyally watched in my grade school days–Tom Corbett Space Cadet. But the fictional hero who defended liberty while piloting the Space Cruiser Polaris would undoubtedly be disappointed with his namesake today ruling the Commonwealth where America was born.

A Republican of the cracked tea pot variety, Governor Corbett has shredded education funding like he was making a Philly Cheese Steak. His appointees of the Schools Reform Commission have gone after public schools in his hometown of Philadelphia with particular zeal. A New York Times story comments on “… the state of austerity across Philadelphia, where this fall, the schools almost did not open on time, and the district has eliminated 5,000 staff positions and closed 31 schools over the last two years.”

But recently the SRC went much farther–abrogating the teacher union contract while immediately requiring teachers for the first time to start paying substantial amounts for their personal health insurance. A labor academic called such unprecedented action the “nuclear option.”

The top leaders of the rest of the Philadelphia union movement were so outraged they called a special meeting to discuss a proposal for a general strike–public and private sectors. But this massive retaliation to the SRC preemptive first strike was vetoed–by the leaders of the teachers. Ignoring the experiences of their sisters and brothers in Chicago, the PFT is instead doubling down on their support to a Democrat “friend” seeking to unseat the Governor.

Many had looked forward to CTU leader Karen Lewis challenging the incumbent Democrat enemy of public education in the Chicago Mayor election next Spring. Sadly we learned last week that Karen has a very serious brain tumor that will keep her out of activity for some time to come. I’m sure all readers join me in wishing Karen a full recovery.

It’s hard to find any kind words however for those teacher leaders in Philadelphia who are incapable of learning the most basic lessons so vital to their immediate future.

If Not Now, When?
I have so far just skimmed a perceptive article in the New Labor Forum entitled If Not Now, When? A Labor Movement Plan to Address Climate Change. The authors are Jeremy Brecher a co-founder of the Labor Network for Sustainability; Ron Blackwell a former Chief Economist of UNITE and the AFL-CIO; and Joe Uehlein, former Secretary Treasurer of the AFL-CIO’s Industrial Union Department, and former director of the AFL-CIO Center for Strategic Campaigns. It is the latest update of a work in progress, quite comprehensive and compelling.

I will comment on their perspective, which I find generally pretty good, in coming Weeks In Review. I wish I had received it before my four day trip to Minneapolis. I was there to share a presentation at the Socialist Action national convention about workers and climate change with Carl Sack. Carl is the age of the grandson I never had, doing graduate work at Madison and active in the AFT local that represents them. He’s getting a good education in both science and working class struggles.

Our presentations were well received and well discussed by the delegates and guests. The resolution adopted shifted climate and environmental issues from being mainly dealt with by a few self-taught experts to the centerpiece of Socialist Action’s activity today. Veteran and novice alike learned from the exchanges and were energized by the optimism and enthusiasm that marked the gathering.

I’m glad I was able to attend. After the expenses of the Labor Notes Conference and the 1934 Minneapolis Teamster Strike commemoration earlier in the year I might not have been able to pull it off without a generous donation from a reader in southern California. If there are any other generous readers out there who haven’t chipped in lately I could use some more help soon with the end of year bills for server and domain registration fees looming. You are our only source of operating funds other than my monthly Social Security.

That’s all for this week.
Free digital subscription to the Week In Review is available through RSS

Check out our digest of news stories about working class and climate issues, posted Monday-Friday by 9AM Central. on our companion Labor Advocate blog.

Our sole source of operating income is reader contributions. If you can help please visit the KC Labor Donate page.

Bill Onasch is a paid up NWU member

Bill Onasch is a paid up NWU member