Wednesday, June 30, 2004

Playing Games With Housing

Congress and the Department of Housing and Urban Development have been playing a transparent game of "good cop, bad cop" since HUD set out to savage Section 8, the federal program that provides housing subsidies for the poor. Republicans in Congress say they budgeted enough money to underwrite the program, and they blame recalcitrant officials at HUD for the cutbacks — while the agency, in turn, maintains that it is doing what Congress told it to do.

Behind the game, however, both sides seem intent on squeezing money from the HUD budget to help pay for all those tax cuts for the rich, even if it means exposing thousands of poor families to the possibility of eviction.

Most of the families who receive subsidies under the 30-year-old Section 8 program live at or below the poverty level. They pay about 30 percent of their incomes toward rent and government vouchers pay the rest.

Conservative Republicans, who have long wanted to scale back the program, have usually been beaten back by their colleagues. This time around, the appropriators in Congress provided full financing for the program while quietly authorizing HUD to make cuts by administrative means. The department then announced that it would no longer pay the full cost of the vouchers, and it froze federal funds at the level of August 2003, plus an adjustment for inflation.

In addition, HUD's new policy involves retroactive cuts, which only became clear at the end of May, long after local housing authorities had committed themselves to helping new families, including many who had waited for years to get decent housing through the voucher program. Obviously, if cuts have to be made, the only sensible way to make them is to do so gradually and well in advance, so the local housing agencies can adjust to the new reality while preserving housing for their most vulnerable tenants.

Faced with unexpected shortfalls, local public housing agencies have informed landlords that they can no longer pay agreed-upon rent subsidies, making it likely that many Section 8 tenants will soon be shown the door. A recent survey from the Center on Budget and Policy Priorities suggests that most agencies with shortfalls will go this route. The survey also shows that local authorities have revoked newly issued vouchers and have begun to withdraw from circulation the vouchers that become available when families get better jobs and move out of the subsidy program.

In addition, local agencies have begun to raise rents for the vulnerable families who can least afford to pay, something that is a sure way of destabilizing these families while driving them deeper into poverty.

The Bush administration is counting on Republicans at the state level to keep quiet in the interest of party solidarity. But given the disastrous nature of the new policies, governors, state legislators and mayors of both parties have both a moral and political obligation to speak out.

Is Wal-Mart Getting Scared?

eRobin of Fact-esque posted a thought-provoking piece suggesting that Wal-Mart customers may be catching on to their unholy practices and shopping elsewhere.

Note: I hope she'll forgive my stealing the whole post but I really couldn't figure out a way to excerpt it without ruining her point.


If July's Numbers Are Bad, WalMart Will Have a Theory Linked to Months With an "R" in Their Names.

I have a theory that the world's largest retailer and Enemy of the People, WalMart, is scared to death that Americans will wake up to what a corrosive force it is in our economy. After just a little bit of press attention to their failures to get outlets in some major cities, partly due to the company's medieval labor practices, WalMart began a publicity blitz that reeked of fear. (here and here) They were probably also anticipating the sexual discrimination suit to hit the papers as well.

Now their very disappointing June numbers are out. They are blaming the poor performance on cool weather and bad Father's Day turnout. To be fair, I don't love my dad as much when the temperature falls below 80. And that analysis makes as much sense as what WalMart has been saying.

In the beginning of June, before we experienced any unseasonable weather and America turned against our fathers, they blamed the calendar in advance:

Wal-Mart Stores Inc., the world's largest retailer, said yesterday that June sales would reach the low end of the expectation range of 4 to 6 percent higher than last year.

[...]

Walmart said that gains might be limited because the June period last year included July 4, when shoppers stock up on traditional holiday items like flags and hot dogs.


So now the sales growth numbers are out and they're even worse than the low end of 4 to 6 percent. In fact, they're twice as bad as that - essentially flat. From AOL news:

Wal-Mart Stores Inc. lowered its forecast Monday for June sales growth at stores open at least a year to a range of 2 percent to 4 percent, citing cool weather and disappointing Father's Day results.

The world's largest retailer said Monday during its weekly sales update that key categories were flat this year as compared to last year, when it had its best week of the summer.


They're terrified. If people threatened by WalMart's economic power, anti-union policies and political reach could manage to organize a one-day boycott/Day of Education targeting Walmarts across the country, the company's head would explode. Why can't we ("organized" labor) get that done??

It's a good question to which I don't have a good answer, though I suspect the fact that 'organized labor' groups have their hands full just surviving may have something to do with it. Still, that's no excuse. She's right about this: Wal-Mart should have been a standard union target years ago.

There may be something to her theory. Wal-Mart is buying time on NPR (let's face it, that's what it is) to announce and promote their 'philanthropic foundation', a pure PR ploy. Why would they do that if their base doesn't listen to it and they don't care about the bad publicity? The Waltons have never been known for their 'philanthropic' urges before.

I can't say I've seen any falling-off of business in the store where I live, but then Wal-Mart drove all the competition out years ago in this area and now they're the only game in town, so probably I wouldn't.

But consider this: Wal-Mart is a leader in the anti-worker war; it was fear of Wal-Mart that caused the supermarket strike in CA that John wrote about. If they got taken down, all the corporations that are looking at adopting Wal-Mart-style labor practices would be quaking in their boots and backing out the door.

So?

Monday, June 28, 2004

Money-Changers Put the Squeeze On

They come at you in steps usually.

Step 1: Lower interest rates to entice you to go into debt

Step 2: Convince you that those interest rates are going to stay low forever if you just keep spending money you don't have to keep the economy growing when it's actually not

Step 3: When you fall for Steps 1 & 2 and you're thoroughly trapped, start raising interest rates on fears of 'inflation'


By several measures, Americans are more indebted than ever. Through the first quarter, they owed nearly $9 trillion in home mortgages, car loans, credit card debt, home equity loans and other forms of personal borrowing — accumulating nearly 40 percent of this total in just four years, according to published Federal Reserve data. But most of the debt is at fixed interest rates. Thus it will be unaffected initially as the central bank begins its much expected quarter-point increases in the so-called federal funds rate, now at a 46-year low of 1 percent. The federal funds rate, in turn, influences the interest rate cost of most household and commercial debt.

Only one-fifth of the $9 trillion in total household debt, or $1.8 trillion, is borrowed at variable rates. Variable rates, like those that the Diffenderfers pay on their four credit cards, often track what the Fed does, which means they are likely to rise one-quarter of a percentage point over the next few weeks. The immediate cost for the nation's households as a result of this process could be as much as $4.5 billion, including the initial $35 increase in the Diffenderfers' monthly credit card bill.

The $4.5 billion is roughly 10 percent of the cost of the rise in oil prices so far this year. That is not a big number yet, but each quarter-point increase would be another step closer to matching the oil shock, which brought gasoline prices above $2 a gallon in many parts of the country.

While the oil shock quickly raised the gasoline and heating oil bills of nearly every household, the burden of higher interest payments falls most heavily in the early stages on lower- and middle-income families. They are the biggest users of variable rate debt, particularly on credit cards, various studies show.

Upper income families, on the other hand - that is, families with more than $80,000 in annual income - are more likely to have fixed rate debt, particularly mortgages, and to owe relatively little on their credit cards. What variable rate debt they do have is usually at lower interest rates than lower income people. Lower income people, as a result, are 10 times more likely than upper income people to be devoting 40 percent or more of their income to debt repayment, the Economic Policy Institute reports. In addition, upper income people are the nation's biggest savers, and a rate increase raises the return on their interest-bearing securities.

Maybe they're the biggest savers because the income distribution is now so top-heavy that they're then only ones with extra money. Yah think? Here's the way the scam works:

The Diffenderfers have a combined income of nearly $70,000 a year, including the overtime he earns and the small payments she receives as assistant organist at her church. They have been married 17 years but they lived with her mother for the first 11, paying her rent. When they finally bought a house of their own in 1998, for $89,000, they had nothing saved for a down payment, and borrowed the entire amount through a 30-year mortgage. They also took out a second mortgage, for $30,000, which they invested in remodeling the home: aluminum siding, a new bathroom and a refinished living room with oak trimmed walls.

As interest rates fell, they refinanced both mortgages, locking in a 5.25 percent fixed interest rate for 30 years. Still, the remodeling continued, mainly on credit cards once the $30,000 was exhausted. Their three-bedroom house is now worth nearly $120,000, almost equal to the mortgage debt, Mrs. Diffenderfer estimates. That leaves the couple with no spare equity that can be extracted in cash through a bigger mortgage. Nor can they lower their $726-a-month mortgage payment. With mortgage rates already rising in anticipation of the Fed's increases, that once lucrative route for millions of consumers is closing.

The Diffenderfers have only their salaries to meet the rising cost of their variable rate credit card debt, although for a while Mrs. Diffenderfer managed to reduce the interest payments by switching the balances to new credit cards whenever she could get a lower rate. The interest rates on her cards now average just under 10 percent, partly through her efforts to find teaser discounts and partly because credit card companies dropped their rates several percentage points, a decline now likely to be reversed.

That's putting it mildly. We have to stop this madness, people. They've got us coming-and-going. It doesn't matter whether you slave to buy--and keep--your own home or rent an apartment, they treat our necessities as an opportunity for theft, and they've got a hundred ways of tricking us into looking the other way while they lift our wallets. We need to get smarter and we need to fight back. It's a rigged game and we're the marks.

Corporate HR fads

An alert reader, Dum Luks sent me this op-ed piece from the English edition of the Japanese paperAsahi Shimbun:
`There is no clear evidence that downsizing actually does any good, at least not in the United States.'

In recent years, Japan's kinder and gentler managers borrowed a critical lesson from their more ruthless American counterparts: They learned to downsize. They got serious about trimming their work forces, that in turn boosted profits, and that finally brought the fragile recovery Japan is now experiencing.

It's a nice story, but there is a big problem with it: There is no clear evidence that downsizing actually does any good, at least not in the United States. What? How could that be? Everyone knows that downsizing reduces costs, and cutting costs raises profits. But that is precisely the point.
Everyone is so convinced that downsizing enhances corporate performance that no one bothers to check the evidence, ...

I have been doing some research on the topic recently, and I discovered to my astonishment that the evidence from the United States suggests that downsizing has not improved corporate performance-whether defined in terms of profits, productivity, or stock price-and many studies indicate that it impairs performance.

After all, downsizing may save a company on labor costs, but it also entails substantial costs: The immediate cost of paying off downsized workers, for example, plus the longer-term cost of losing valuable personnel and undermining employee morale.

In one of the most authoritative studies, prominent economists William Baumol, Alan Blinder and Edward Wolff [in the book Downsizing in America] find that downsizing does not improve productivity, lowers stock performance and raises profits-but only by depressing wages. Other studies contend that downsizing does not even increase profits, and one study suggests that layoffs actually decrease profits in subsequent periods.

So if downsizing doesn't help, then why have so many American companies rushed to do it? Several scholars have taken up this puzzle, and they conclude that American managers are so beholden to the myth that downsizing is effective that they do not even bother to check whether it happens to be true. They also contend that managers view downsizing as a social norm, so they do it to preserve or enhance their firm's reputation.

The rest of the piece speaks about the specifically Japanese case and is worth reading. For my part, I find that last statement the most interesting. Most corporations do not downsize because of the results of an honest cost/benefit analysis, they do it because all of the other corporations are doing it. Peer pressure. Management through fads. Even to give them the most credit possible, they do it to appease the investors, who themselves are acting in herd-like response to fads.

To make up for understaffing, companies have run through a whole sequence of supporting fads with self-complementary rationales. First, it was filling in with temp labor. The rhetoric to support this fad was that we just get the help we need when we need it. We’re responding lightning fast to changes in the market. As this was dying out we got the tech boom. Start-ups made everyone a salaried employee and demanded they demonstrate their dedication by working hundreds of hours of unpaid overtime each year (for both of the years they lasted before burning out). Now off-shore out-sourcing and Wal-Mart style return to nineteenth century labor conditions are the magic solutions.

All of these fads were morale killers. Employees have no reason to be loyal to a company that’s not loyal to them. Even where it’s possible to stay, no one expects to stay. In the past, the answer to “what do you do for a living” was some variation of “I am this.” Today you more often hear some variation of “right now I’m doing this.”

All of these companies reduce continuity and institutional memory. Rapid turnover and short-term help are always on the low end of the learning curve. We congratulate ourselves on increases in productivity, but how much more productive would a stable and experienced work force be?

My gut feeling is that these human resources fads are as bad as management fads and as damaging to the corporations as they are for the work force. I’m encouraged to see that people like the anonymous author of this op-ed piece are finally asking the right questions and gathering the data that could prove this.

Friday, June 25, 2004

Bush's 'New Jobs' 2

Update: According to a University of Chicago economics professor commenting on NPR's Marketplace last night, more jobs have been created in debt collection over the past year than in all the manufacturing sectors combined.

And that says it all, don't it?

Class Warfare in America by Bill Moyers, Part 4

Household economics is not the only area where inequality is growing in America. Equality doesn't mean equal incomes, but a fair and decent society where money is not the sole arbiter of status or comfort. In a fair and just society, the commonwealth will be valued even as individual wealth is encouraged.

We don't have a just society and I don't expect it to happen in my lifetime but I will go further: We can't even hope to build a society that is trying to be fair and just unless and until the commonwealth and individual and corporate wealth are considered of equal worth. As long as the latter are more valued than the former, we don't even have a democratic society--we have a society filled with oligarchs and people who want someday to be oligarchs. It is the revolutionary idea, first that there is such a thing as a commonwealth--that society represents a wealth that we all share in common--and second that our common wealth and well-being is at least as important as our individual wealth and well-being, that is the underpinning of the democratic ideal. Without it, without a profound and lasting commitment to it, we are at best a corporate oligarchy and at worst a dictatorship waiting to happen.

Let me make something clear here. I wasn't born yesterday. I'm old enough to know that the tension between haves and have-nots are built into human psychology, it is a constant in human history, and it has been a factor in every society. But I also know America was going to be different. I know that because I read Mr. Jefferson's writings, Mr. Lincoln's speeches and other documents in the growing American creed. I presumptuously disagreed with Thomas Jefferson about human equality being self-evident. Where I lived, neither talent, nor opportunity, nor outcomes were equal. Life is rarely fair and never equal. So what could he possibly have meant by that ringing but ambiguous declaration: "All men are created equal"? Two things, possibly. One, although none of us are good, all of us are sacred (Glenn Tinder), that's the basis for thinking we are by nature kin.

Second, he may have come to see the meaning of those words through the experience of the slave who was his mistress. As is now widely acknowledged, the hands that wrote "all men are created equal" also stroked the breasts and caressed the thighs of a black woman named Sally Hennings. She bore him six children whom he never acknowledged as his own, but who were the only slaves freed by his will when he died -- the one request we think Sally Hennings made of her master. Thomas Jefferson could not have been insensitive to the flesh-and-blood woman in his arms. He had to know she was his equal in her desire for life, her longing for liberty, her passion for happiness.

In his book on the Declaration, my late friend Mortimer Adler said Jefferson realized that whatever things are really good for any human being are really good for all other human beings. The happy or good life is essentially the same for all: a satisfaction of the same needs inherent in human nature. A just society is grounded in that recognition. So Jefferson kept as a slave a woman whose nature he knew was equal to his. All Sally Hennings got from her long sufferance -- perhaps it was all she sought from what may have grown into a secret and unacknowledged love -- was that he let her children go. "Let my children go" -- one of the oldest of all petitions. It has long been the promise of America -- a broken promise, to be sure. But the idea took hold that we could fix what was broken so that our children would live a bountiful life. We could prevent the polarization between the very rich and the very poor that poisoned other societies. We could provide that each and every citizen would enjoy the basic necessities of life, a voice in the system of self-government, and a better chance for their children. We could preclude the vast divides that produced the turmoil and tyranny of the very countries from which so many of our families had fled.

We were going to do these things because we understood our dark side -- none of us is good -- but we also understood the other side -- all of us are sacred. From Jefferson forward we have grappled with these two notions in our collective head -- that we are worthy of the creator but that power corrupts and absolute power corrupts absolutely. Believing the one and knowing the other, we created a country where the winners didn't take all. Through a system of checks and balances we were going to maintain a safe, if shifting, equilibrium between wealth and commonwealth. We believed equitable access to public resources is the lifeblood of any democracy. So early on [in Jeff Madrick's description,] primary schooling was made free to all. States changed laws to protect debtors, often the relatively poor, against their rich creditors. Charters to establish corporations were open to most, if not all, white comers, rather than held for the elite. The government encouraged Americans to own their own piece of land, and even supported squatters' rights. The court challenged monopoly -- all in the name of we the people.

Moyers has here named exactly the source of the unease that afflicts many with doubts about the way things are going. They can't articulate it as well, but deep down somewhere inside they know that something is dreadfully wrong with the attitudes that have been fostered by the right over the past three decades, that we are no longer even trying to live up to our promise, that we have allowed ourselves to be taken in by con-artists and snake-oil salesman who dazzle us with their "Goverment Is BAD" carnival sideshow.

Distance from the battles of the past, a plethora of new and and expanding distractions, a lack of direct understanding of or involvement in the democratic process, the pressures of an economy that is so friendly to business that it now requires two working parents and 60+ hours a week to survive, all contribute to the sense the right has exploited that government is irrelevant, that it has nothing to do with our lives. And I wonder if we will understand how Big a Lie that is before we lose the government we dismiss so easily and thoughtlessly only to see it replaced by yet another band of plutocrats, slumlords, and money-changers.

If we don't, the Great Experiment that was America is over, and the shameful part is that we will have killed it for trivialities--greed and the illusion of a safety that doesn't exist unless we band together for the common good of all.

IBM settles 50 lawsuits by former San Jose plant workers

One of the biggest dangers that almost all workers face at one time or another is the workplace itself. Whether it's RMS (Repetitive Motion Syndrome) or toxic chemicals and pollutants or SBS (Sick Building Syndrome), we are all exposed to debilitating workplace hazards that can--and do--make us ill or even kill us, often years after that exposure.

Corporate history on this issue is abysmal when it isn't criminal (remember Erin Brockovich? That's standard behaviour): denial, unconscionable personal attacks on the victims involving innuendo and outright lies, bald-face lying to investigating authorities, cover-ups, destruction of evidence, the list goes on and on. The one thing not on that list is: they never agree to clean up their mess until they're forced to, either by govt or the courts.

Which makes me wonder about this item:


NO TERMS WERE DISCLOSED IN TOXIC CHEMICALS CASES

By Therese Poletti

San Jose Mercury News

IBM has settled 50 toxic chemical lawsuits brought by former employees at its San Jose manufacturing plant.

The terms of the confidential settlement in the closely watched litigation were not disclosed.

Chris Andrews, a spokesman for the Armonk, N.Y., computer giant, said Wednesday that a Santa Clara County Superior Court judge dismissed the cases following a settlement between the company and the plaintiffs.

Richard Alexander, the lead attorney for the plaintiffs in San Jose, did not return calls or e-mails seeking comment.

In February, a Santa Clara County Superior Court jury rejected two former IBM workers' claims that they suffered systemic chemical poisoning as a result of their work at IBM's Cottle Road disk drive manufacturing plant between the 1960s and 1980s.

Alida Hernandez, 73, and James Moore, 62, contended that exposure to acetone, benzene, trichloroethylene and other chemicals used in manufacturing clean rooms caused them to develop cancer. Hernandez suffered from breast cancer, and Moore has non-Hodgkin's lymphoma.

The former IBM workers alleged that IBM knew they were ill and concealed that information from them. Their case, in which they were seeking millions of dollars in punitive damages, was the first of the some 50 similar cases to go to trial. The jury verdict in favor of IBM was unanimous.

In March, Judge Robert Baines put the remaining cases on hold and ordered both parties to meet with a mediator.

As far as I know, this is unprecedented. Oddities:

1) It's not unusual for a judge to order the remaining parties in a large lawsuit like this into mediation after a verdict is either split or goes to the plaintiffs; it's very unusual for a judge to do so when the verdict is unanimous and in favor of the defendant;

2) The company went into mediation; standard form is to appeal the judge's ruling, and given the jury's decision, IBM would have grounds for it to be set aside;

3) IBM has been involved in a number of suits resulting from unsafe working conditions and toxic poisoning; their history is to settle before the trial begins or after they've lost:


IBM previously settled two birth-defects cases in New York. In March, IBM settled a birth-defects lawsuit with the daughter of a former semiconductor plant worker in East Fishkill, N.Y., just before jury selection was to begin. Terms of that settlement were not disclosed. The plaintiff, Candace Curtis, was seeking $100 million in damages.

In January 2001, IBM settled another birth-defects lawsuit with the family of Zachary Ruffing, who was born blind. Both his parents worked at the East Fishkill plant in the 1980s.

Why agree to a settlement after an outright win? The PR pounding, maybe; sometimes it's more harmful for a company to have its workplace practices exposed in print even if it wins its case than if it just pays everybody to go away and keep it out of the media. But why did the judge order it? After the defendant loses, it's in everybody's interest to settle and get the suit out of the courts, but when the defendant wins it's only in the interest of the plaintiffs. And I'm not the only one who thinks this is odd.

"It is difficult to draw conclusions'' from confidential settlements, said John Kalin, a San Francisco attorney who specializes in toxic tort cases. "Usually, when it's a confidential settlement, it's requested by the corporation.''

Kalin said companies typically try to reach confidential settlements so the settlement cannot be used against them in future litigation. But he also noted that in the San Jose case the plaintiffs might not have had a lot of influence. "If you don't have a favorable jury verdict, you don't have the kind of leverage you would have if you had gotten a multimillion-dollar verdict.''

(emphasis added)

The only time I've ever seen judges do that is when they thought there had been a miscarriage of justice and that the jury--which it's allowed to do--had ignored the law in reaching their verdict to such an extent that the equivalent of legal violence had been done. I think that's what may have happened here.

Who knows why the jury did what it did? I wasn't sitting in the courtroom and I don't. What does seem clear is that, for whatever reason, IBM, as corporations do far too often, has once again dodged an accountability bullet by buying its way out of mistakes and/or policies that harmed its workers.

We were not, we are not, a priority for them, no matter what they say when they want to cut our pay. Or abandon our suit against them.

Wednesday, June 23, 2004

Bush's "New Jobs" in Low-Wage Industries; Wage-Levels Remain Stagnant

By Jonathan Weisman and Nell Henderson
Washington Post Staff Writers
Wednesday, June 23, 2004; Page E01

Employers have added 1.2 million jobs this year, and average weekly earnings rose 0.3 percent in May and 2.5 percent in the 12 months that ended in May, seasonally adjusted, the Labor Department reported.

But Democrats say paychecks are failing to keep up with the cost of living. After adjusting for inflation, average weekly earnings fell 0.4 percent last month and 0.5 percent in the 12-month period.

"I believe we can do better than rising costs and shrinking incomes," Sen. John F. Kerry (Mass.), the likely Democratic presidential candidate, told an AFL-CIO convention last week.

Some economists also point to stagnant wages and eroding job quality as dark clouds looming over the economic recovery.

"Despite the well-advertised pick-up of job growth, recent trends in real wage income remain very disappointing," lamented Stephen S. Roach, chief economist at Morgan Stanley, in a June 7 memo to clients. "This, in my view, underscores one of the most serious shortcomings of this recovery -- an unprecedented shortfall of the most important piece of personal income growth," wages and salaries.

Over the first 29 months of the economic recovery, total wages and salaries have risen less than 3 percent after adjusting for inflation -- a fraction of the 9 percent gains of the previous six upturns, Roach said. That works out to a $280 billion income gap between where workers are and where they should be, he concluded.


CIBC World Markets, a Toronto-based investment banking firm, reached a similar conclusion in a report issued Monday. That study found that U.S. job creation since late 2001 has been concentrated in low-paying industries such as hospitality, education and personal services, while job losses have hit higher-wage sectors such as transportation, manufacturing, utilities and natural resources.

"The message is clear: The vast majority of the jobs that evaporated during the job-loss recovery were high-quality jobs," the CIBC study concluded.

(To read the rest, click the title)

Stealth Candidate DeMint Wins SC Primary

By JENNIFER HOLLAND
Associated Press
Published on: 06/23/04

Three-term South Carolina Rep. Jim DeMint soundly defeated former Gov. David Beasley in a Republican runoff Tuesday to earn a spot on the November ballot for an important Senate seat that has been occupied by the same Democrat for almost 40 years.

With all precincts reporting, DeMint had 59 percent to Beasley's 41 percent.

In Utah, billionaire businessman Jon Huntsman Jr., a Bush administration diplomat who also worked as a White House aide under Ronald Reagan, faced a lesser-known challenger in the Republican gubernatorial primary.

Utah is one of 11 states with governor's races this year, and Huntsman was heavily favored to be the Republican nominee.

DeMint's victory brings an end to a comeback attempt by Beasley, who was bounced from the governor's office in 1998 after angering voters by calling for lowering the Confederate flag from atop the state Capitol.

DeMint will face Democratic state Education Superintendent Inez Tenenbaum this fall in a race that could help determine the balance of power in the Senate.

Despite South Carolina's conservative leanings, Democrats believe they have a serious shot at maintaining the seat that retiring Sen. Ernest "Fritz" Hollings has held since Lyndon Johnson was in the White House.

They are confident that President Bush's vulnerability and Tenenbaum's moderate message could spell trouble for the GOP nominee.

Republicans see the race as a chance to solidify their Senate majority.

The GOP nominee will have the advantage of a Republican president at the top of the ticket in a state that gave Bush 58 percent of its votes in 2000.

Electronic Cards Replace Coupons for Food Stamps

By ROBERT PEAR

Published: NYT, June 23, 2004

WASHINGTON, June 22 — The Bush administration announced Tuesday that it had completed one of the biggest changes in the history of the food stamp program, replacing paper coupons with electronic benefits and debit cards.

At the same time, the administration said it wanted to rename the program because the term "food stamps" had become an anachronism. It is inviting the public to suggest how to update the name of a program that became a permanent part of the government, and the nation's vocabulary, during Lyndon B. Johnson's Great Society era.

Electronic benefits have replaced food stamp coupons in all states, and more than half the states now issue electronic benefits in place of welfare checks as well. In addition, some states are using debit cards for Medicaid and the Special Supplemental Nutrition Program for Women, Infants and Children.

Agriculture Secretary Ann M. Veneman declared an end to the "paper era" of the food stamp program on Tuesday at a conference of state officials here.

"This month the food stamp program arrived in the 21st century," Ms. Veneman said. "States are destroying the paper coupons, and we don't anticipate that we'll ever have to print them again."

Food stamp recipients generally like debit cards because they avoid the stigma that can be associated with the use of paper coupons. Grocers like the new technology because they are paid faster, often within 48 hours; cashiers do not have to handle vouchers; and there are no coupons to sort, count and bundle.

State officials said they preferred the electronic system because it was simpler to administer and helped reduce fraud and abuse by eliminating the paper coupons that can be lost, sold or stolen. Over the years, food stamps have been sold on the black market and used as a form of currency to buy narcotics and other contraband.

More than 23 million people receive food stamp benefits each month, but nationwide only three of five eligible people are participating. Unlike most other assistance programs, food stamps are available to most low-income households with few assets regardless of age, disability or family structure.

(To read the rest, click the title.)

Class Warfare in America by Bill Moyers, Part 3

Let me tell you about the Stanleys and the Neumanns. During the last decade, I produced a series of documentaries for PBS called "Surviving the Good Times." The title refers to the boom time of the '90s when the country achieved the longest period of economic growth in its entire history. Some good things happened then, but not everyone shared equally in the benefits. To the contrary. The decade began with a sustained period of downsizing by corporations moving jobs out of America and many of those people never recovered what was taken from them. We decided early on to tell the stories of two families in Milwaukee -- one black, one white -- whose breadwinners were laid off in the first wave of layoffs in 1991. We reported on how they were coping with the wrenching changes in their lives, and we stayed with them over the next ten years as they tried to find a place in the new global economy. They're the kind of Americans my mother would have called "the salt of the earth." They love their kids, care about their communities, go to church every Sunday, and work hard all week -- both mothers have had to take full-time jobs.

Mr Moyers may have started following them in '91 but that's not when the 'first round of layoffs' was. That was the third round. The first was 4 years before that at the end of Reagan's second term when the push to keep the Reagan-era profits of 20%+ was on. That first round would have been a lot more dislocating if employers had actually been laying people off, but they weren't. What was happening was that a fad ran through the corporate halls, and the fad was a trick: wages go down when jobs are scarce, right? But jobs weren't scarce. How do you fix that little problem? Pretend they are.

Employers started complaining that profits were down (by which they often meant, as we found out later, that profits hadn't grown by as much as expected) and that wages were too high, they were having trouble meeting the payroll, and there might have to be layoffs. Once that frightening prospect was in everybody's head, they started the layoffs, most of which were centered on blue-collar rather than white-collar employees. The layoffs lasted anywhere from a couple of weeks to a few months, depending on how long the company thought it could get by short-staffed. Then would come the calls: 'We want you to come back to work but you'll have to work for half what you were getting before or we're going to go under. We can't afford to pay so much any more.' We believed them and most of us went back to work--at half pay.

One manufacturer of tools, the biggest employer in my area (was then, still is), was making a profit of $70-100Mil/yr when it pulled this stunt, and it cut its average pay rate from $15/hr to under $8 in one fell swoop, and this was for skilled labor. Its unskilled rate dropped from $7.50/hr to the minimum wage--$3.10/hr at that time, if memory serves. The payroll cut boosted the company's earnings all of 3%, but that was what they needed to meet the promises they'd made to investors and expectations on Wall Street. Their stock went up--by 8 cents. The program was considered a great success.

The second round was 1989-90, when employers were looking for another shortcut to boost their stocks. Blue-collar wages had been permanently depressed (they've never come back) by the first scam, so what they needed to do now was cut the white-collar payroll. First they made across-the-board cuts in all depts, 10-20% usually, but the cut was concentrated on older employees at higher salaries. They weren't cutting positions, it turned out, they were removing--firing--55 and 60-yr-old men at the high end of the salary spectrum in order to replace them with recent college grads at entry-level salaries (which is why the unemployment rate didn't skyrocket despite the massive layoffs--many of the workers they fired were replaced by cheaper ones). This was the tactic that started Jack 'The Axe' Welch on the road to corporate fame and fortune.

The third round--the round Mr Moyers is talking about--was the most brutal. Technological advances had kicked in and this time the jobs disappeared for real. But that wasn't going to be enough to give the corporations the boost they wanted, so they began claiming poverty in order to cut benefits--health care plans like BC/BS which covered practically everything were dropped in favor of health care plans with cheap premiums that covered almost nothing, and even then the burden of paying the premiums was shifted to the employees--companies that had been paying it all now paid half, companies that had been paying half now paid 10%--or even stopped contributing to the cost altogether; and worst of all, a lot of companies outright stole their employees' pension funds, shifting them over to a general fund so they'd be available. Millions of middle-aged men and women discovered overnight that the pensions they had counted on for their retirement were gone, absorbed by the companies. This was supposed to be--and was--illegal, but few suits were brought, and the Bush I DoJ did NOTHING to discourage the tactic. At the end of Bush I's only term, corporations had boosted their earnings by $Billions$ stolen from those pension funds and Poppy was crowing about how 'good' the economy was.

That's where we were when the Stanley's and the Neumann's got sacked.


During our time with them, the fathers in both families became seriously ill. One had to stay in the hospital two months, putting his family $30,000 in debt because they didn't have adequate health insurance. We were there with our camera when the bank started to foreclose on the modest home of the other family because they couldn't meet the mortgage payments after dad lost his good-paying manufacturing job. Like millions of Americans, the Stanleys and the Neumanns were playing by the rules and still getting stiffed. By the end of the decade they were running harder but slipping behind, and the gap between them and prosperous America was widening.

What turns their personal tragedy into a political travesty is that they are patriotic. They love this country. But they no longer believe they matter to the people who run the country. When our film opens, both families are watching the inauguration of Bill Clinton on television in 1992. By the end of the decade they were no longer paying attention to politics. They don't see it connecting to their lives. They don't think their concerns will ever be addressed by the political, corporate, and media elites who make up our dominant class. They are not cynical, because they are deeply religious people with no capacity for cynicism, but they know the system is rigged against them. They know this, and we know this. For years now a small fraction of American households have been garnering an extreme concentration of wealth and income while large corporations and financial institutions have obtained unprecedented levels of economic and political power over daily life. In 1960, the gap in terms of wealth between the top 20% and the bottom 20% was 30 fold. Four decades later it is more than 75 fold.

Such concentrations of wealth would be far less of an issue if the rest of society were benefiting proportionately. But that's not the case. As the economist Jeff Madrick reminds us, the pressures of inequality on middle and working class Americans are now quite severe. "The strain on working people and on family life, as spouses have gone to work in dramatic numbers, has become significant. VCRs and television sets are cheap, but higher education, health care, public transportation, drugs, housing and cars have risen faster in price than typical family incomes. And life has grown neither calm nor secure for most Americans, by any means." You can find many sources to support this conclusion. I like the language of a small outfit here in New York called the Commonwealth Foundation/Center for the Renewal of American Democracy. They conclude that working families and the poor "are losing ground under economic pressures that deeply affect household stability, family dynamics, social mobility, political participation, and civic life."

It's that pressure that drives people away from the ballot box: they have all they can do to maintain their families--we're working longer days, longer weeks and taking fewer and shorter 'vacations' which technology (laptops, cel-phones) allows employers to consider, in effect, 20-hr work-weeks instead of 40+--as it is and they have little time or energy to spare for participation in a process they have good reason to believe wants nothing to do with them and is, in fact, usually the 'enemy'. Are we supposed to get excited about Dems just because they'll cut 15% less from services we need than the Pubs? Up to now, the difference between the two corporate-owned parties has been largely cosmetic. Nobody--NOBODY--has been speaking for us.

Except Michael Moore.

Tuesday, June 22, 2004

How Come Only Unions Are Considered Dumb?

Strike Cuts Kroger Profit
The company estimated that the labor dispute, which also affected its rivals Safeway Inc. and Albertsons Inc., cut the latest earnings by $71.6 million, or 10 cents per share.
Kroger masquerades as Ralphs here in SoCal, and they had it easiest in the strike. The union pulled the pickets off Ralphs. I still refused to shop there, but I imagine most people didn't. I don't know how much the companies lost total on the strike, but it's got to be a mighty nice chunk of change.

Did the workers lose also. It sure looks that way to me, and I know it looks that way to them. I don't ordinarily talk much to people I don't know, but when the local Vons workers came back I made a special effort to let them know I'd supported them and I felt bad about how it'd turned out. From what they said, I've no doubt they feel like they lost. I hope they feel no shame in that. They were outgunned from the gate, as always.

All my life I've been hearing what dumbasses unions and their members are because they always lose money in a strike. Even used to hear it from my dear old Grandad. Even gramps couldn't be right all the time. However, except among union supporters, I never hear anyone saying what dumbasses the companies are for allowing the strikes to take place. They lose a hell of a lot too.

It's not as though workers are eager to go out, especially these days. How long could you last on half pay or less? How long can the chronically ill go without health insurance? Strikes scare workers to death.

Yet, as always, people seem to think it's perfectly OK to judge their fellow workers, the people of their own class, more harshly than they judge the slimeball elites. Go figger.

Monday, June 21, 2004

Why Does The Right Hate Workers?

NLRB Unrolls Assault on Labor Rights, a post by Nathan Newman I found via Seeing The Forest, highlights another anti-non-rich people decision by the right wing extremists. Cute part is, they even managed to drag in the War on Terra as an excuse for refusing to follow the plain meaning of the law. Rule of law my rancorous rear end.

If you also feel the need to read section 7 of the NLRA, you can find it, and the rest of the act, here.

Charging Big Bucks for Treating the Poor Like Human Beings

Three weeks ago, we relayed a story about stores that specialized in selling to WIC customers so they could gouge the goverment program:
[T]he prices at W.I.C. specialty stores are typically 10 percent to 20 percent higher than those at supermarkets and other retail grocers.
Now. less than a month later, our usually slow-moving government is moving with lightning speed to solve the problem--it's going to start cutting mothers from the program.


By Virginia Ellis, LA Times Staff Writer

SACRAMENTO — Some of California's poorest children could soon be shut out of a government food program due to an explosion of stores that cater to low-income mothers but charge top dollar for milk, eggs and other staples.

Prices at the stores — most in the Los Angeles area — are as much as 16% higher than at supermarkets and other retailers. Many have sprung up in clusters near offices where young mothers go for food vouchers and nutrition classes.

Experts say the jump in the number of these businesses is now adding $33 million a year to the cost of the Women, Infants and Children program in California, which serves nearly 1.3 million people.

"Over the long haul, the major driving force that is raising our costs are these [stores]…. To the extent that they become more predominant and charge more overall, we have to find ways to cut corners," said Linnea Sallack, chief of the WIC branch of the California Department of Health Services.

Nationally, about 100,000 eligible children, pregnant women and new mothers could be denied benefits, one official estimated. It has not been determined how many of those would be in California.

The number of recipients the program can serve is limited by the amount of the federal grant that funds it, so high costs threaten its ability to serve all those who are eligible. Despite the rising costs brought about by these stores, in previous years the state has been able to serve all eligible participants by dipping into a federal emergency fund, but that money has now run out.

Although the WIC program is a quarter-century old and most state retailers accept its vouchers, the growth of stores exclusively serving its recipients has taken officials by surprise. The phenomenon is nationwide, but the biggest increase has been in California, where the number of stores has grown from 86 in 1996 to 322 in 2001 and to 659 this year. In the late 1990s, they accounted for only 11% of the WIC dollars spent on food; this year, the figure has vaulted to 43%. Nationally, the current number is about 11%.

According to federal data, nationwide there were 523 of the stores in 2000. In 2001, the number increased to 621, and by 2002 it had reached 778.

The federally funded program is administered by the state, and regulations to curb its costs have been grinding through Sacramento since 2000. The new rules are pending in the state Department of Health Services and are opposed by the specialty grocers, who have spent $427,113 on lobbyists and consultants in the last three years and have given campaign money to key politicians.

The Federal government 'acknowledges' that the stores aren't doing anything illegal--but isn't price-gouging illegal? Isn't price-fixing illegal? These stores aren't competing, they're all selling at the highest price allowed by the program even though the high-end costs weren't intended to pad their pockets.

Unlike food stamps, WIC vouchers are not for specific dollar amounts but for 60 particular food items. Other stores — where competition generally keeps prices lower — redeem them at the prices they charge paying customers.

But WIC-only stores have no such customers. They sell only to WIC recipients and generally stock just the milk, cheese, cereal, eggs, juice, peanut butter and other staples authorized by the program. And they tend to charge the government the WIC maximum, which is set high to make sure grocers in isolated or rural areas can cover their increased costs.

WIC-only stores are generally in urban areas and have no such costs. Doesn't thast make thier pricing policies actionable? Ask how these stores justify their over-charging and things get real interesting. First, they say--

[Manuel Castaneda, president of the Nutritional Grocers Assn. of California and co-owner of 32 WIC stores,] noted that WIC-only stores don't get the price breaks and other allowances from manufacturers that big chains get for buying in volume. But "the Nutritional Grocers Assn. supports efforts to contain food costs," he said.

Greenstein, who has analyzed the data from the state report on redemption costs, said it showed WIC-only stores consistently charged prices not only higher than chain supermarkets but also higher than grocers with one or two cash registers.

Oops. Excuse #1 down the tubes. On to excuse #2, and the problem with this one is the truth in it. Castenada claims that the stores are necessary because they provide a shopping place where the shoppers aren't ridiculed.

Recipients flock to their stores, they said, because they offer convenience, easy access to authorized items, and clerks who speak their language and treat them respectfully.

"I think if you ask the participants, they'll tell you they shop in WIC-only stores because … they don't like the way they're treated by clerks in other stores," said Manuel Castaneda, president of the Nutritional Grocers Assn. of California and co-owner of 32 WIC stores. "They don't like the way they're treated by other customers."

"The dirty looks, the sneers, the grunts — WIC transactions are complicated and time-consuming," he said. "They come up to the register with six vouchers … and everybody in line starts grunting."

In WIC specialty stores, Castaneda said, customers don't have to search the aisles for approved items; a clerk brings what they need to the counter and helps with the transactions.

"We give them dignity. We give them a comfortable environment that's free of stigma," Castaneda said.

In other words--let's just cut to the chase--the 15% surcharge is justified because they treat low income mothers as if they were real people while other stores treat them like, well, like poor people: unwanted, dirty, time-consuming leeches sucking at the public tit because they're too lazy to get real jobs.

I hate to say it but Casteneda has a point: there have been times when I needed food stamps in order to avoid starvation--literal starvation, not figurative--and I know damn well how people's attitude changes toward you when you pull that scrip out of your pocket instead of money. I can readily understand why the mothers prefer WIC-only stores that cater to them to chain groceries that treat them as if they're something that crawled out from under a rock.

What's disturbing about this argument isn't the truth in it but the fact that Casteneda thinks he deserves--in all of his 32 stores--a sizable payment for being human to other humans. Apparently we have reached the stage in America where we think we have a right to be paid an exorbitant price for being courteous to the poor.

Some arguments don't deserve to live

Mick's discovery of the South Carolina stealth candidate Jim DeMint is as enlightening as it is disturbing.
"How can a free nation survive when a majority of its citizens, now dependent on government services, no longer have the incentive to restrain the growth of government?" he asked during a Heritage Foundation lecture in 2001. His prescription? "We must have a new tax code that allows all voters to see and feel the cost of government," he counseled. "Using the tax code to help low-income workers only disconnects them from the responsibilities of freedom."

What a load of crap. The only thing new in this argument is the boldness to say it out loud, but even DeMint won't say such a thing directly to the voters, just to his moneyed supporters. For decades, anyone in the mainstream who believed stuff like this at least had the good taste to be embarrassed (or afraid) to say it out loud. Only fringe nuts like World Net columnist Vox Day would openly make such an argument. Then last year, our friends on the Wall Street Journal editorial page revived this old argument in their infamous "lucky ducky" editorial, once again making it socially acceptable.

How old is this argument? This is one of the original arguments against democracy from the days of the constitutional convention. Only (white) men of property should be allowed to vote because only they have a stake in society. Allowing unpropertied men to vote would lead to mob rule. The "mobocracy" would vote subsidies to itself and society would collapse. For the sake of order and stability, only the (self-proclaimed) better classes should be allowed to vote. European ennobled ruling elites continued to make the mobocracy argument against every expansion of the franchise right up until they were swept away in World War One. After that Europe had the painful Fascist experiment in crudely manipulating the masses for the benefit of a group of murderous psychopaths.*

Reconnecting low-income workers with "the responsibilities of freedom" by taking away a larger portion of their already small paychecks is not likely to make them feel more empowered. It's likely to make them angry. WSJ's "lucky ducky" argument increasing the hostility of the working poor toward the government by taxing them more and reducing services would make them vote for conservative candidates who promise to lower their taxes and eliminate services altogether. I suppose that's possible, but its more likely to increase their hostility toward the wealthier classes who contribute little to the government while reaping many benefits (such as police protection from the resentful poor).

This is not speculation on my part, this is the historical record of the good old days of the nineteenth century that the extremists supporting Bush so dearly want to return. Social security, both as a program and as a phrase, originated in Bismarck's Prussia, a thoroughly reactionary state. The phrase as he used it did not mean security within society for the poor. It meant security of society against the poor. By providing, what we now call, a safety net for the working poor, Bismarck hoped to prevent them joining leftist political parties or more directly creating unrest. There was nothing soft or altruistic in his plan. He knew that if the poor were not given the basic necessities of life, either through fair pay or outright grants, they would take them by force. That the programs were good for the poor was incidental; Bismarck's real goal was to protect the propertied classes from revolution.

When Roosevelt pushed through programs like the minimum wage and legalized unions, he most likely prevented a violent revolution in this country. It's tragic that today's reactionaries do not understand this.

* I know. I know. In any democracy the masses are, to an extent, manipulated by some elite. The manipulation itself wasn't as significant in Fascism as were the methods of manipulation (crude hate mongering) and the goals of that manipulation (destruction of the democracy among others). It's also significant that the manipulators were not part of the elite; they used the mobilized masses to threaten and subdue the traditional elites, and eventually replace them (this is one of the elements that makes it possible to talk of Fascism as a revolutionary ideology).

Sunday, June 20, 2004

Class Warfare in America by Bill Moyers, Part 2

Here's something else [to get mad about]: Caroline Payne's face and gums are distorted because her Medicaid-financed dentures don't fit. Because they don't fit, she is continuously turned down for jobs on account of her appearance. Caroline Payne is one of the people in David Shipler's new book, The Working Poor: Invisible in America. She was born poor, and in spite of having once owned her own home and having earned a two-year college degree, Caroline Payne has bounced from one poverty-wage job to another all her life, equipped with the will to move up, but not the resources to deal with unexpected and overlapping problems like a mentally handicapped daughter, a broken marriage, a sudden layoff crisis that forced her to sell her few assets, pull up roots and move on. "In the house of the poor," Shipler writes "...the walls are thin and fragile and troubles seep into one another."

Here's something else to get mad about. Two weeks ago, the House of Representatives, the body of Congress owned and operated by the corporate, political, and religious right, approved new tax credits for children. Not for poor children, mind you. But for families earning as much as $309,000 a year -- families that already enjoy significant benefits from earlier tax cuts. The editorial page of The Washington Post called this "bad social policy, bad tax policy, and bad fiscal policy. You'd think they'd be embarrassed," said the Post, "but they're not."

And this, too, is something to get mad about. Nothing seems to embarrass the political class in Washington today. Not the fact that more children are growing up in poverty in America than in any other industrial nation; not the fact that millions of workers are actually making less money today in real dollars than they did twenty years ago; not the fact that working people are putting in longer and longer hours and still falling behind; not the fact that while we have the most advanced medical care in the world, nearly 44 million Americans -- eight out of ten of them in working families -- are uninsured and cannot get the basic care they need.

Astonishing as it seems, no one in official Washington seems embarrassed by the fact that the gap between rich and poor is greater than it's been in 50 years -- the worst inequality among all western nations. Or that we are experiencing a shift in poverty. For years it was said those people down there at the bottom were single, jobless mothers. For years they were told work, education, and marriage is how they move up the economic ladder. But poverty is showing up where we didn't expect it -- among families that include two parents, a worker, and a head of the household with more than a high school education. These are the newly poor. Our political, financial and business class expects them to climb out of poverty on an escalator moving downward.

Latest Republican Radical: "The Poor Don't Pay Enough Taxes"

Jim DeMint, a rising star in the radical Republican firmament, is campaigning for the Senate in South Carolina on a platform that is as extreme as it is hidden.

By Jonathan Weisman
Washington Post Staff Writer
Sunday, June 20, 2004; Page A05

In a state that has lost more than 57,000 manufacturing jobs since 2001, many to foreign competition, a resolute message on free trade might be considered problematic for a political candidate.


In the ninth-poorest state in the nation, a candidate who openly worries that the poor are not paying enough taxes could be expected to face a stiff political head wind.

In a state where an already substantial retiree population will surge 19 percent this decade, a politician championing one of the most dramatic Social Security privatization proposals in Washington could expect some problems.

But that politician, Rep. Jim DeMint (R-S.C.), has not only gained stature in his quest for the Republican nomination to represent South Carolina in the Senate. He is also now seen by many Republicans as the party's best shot at snatching that seat from the Democrats in November, when its occupant, Sen. Ernest F. Hollings, retires.

When DeMint faces former governor David Beasley on Tuesday in a runoff for the GOP nomination, he carries with him the hopes of ardent economic conservatives in Washington, who see the three-term congressman as a potential champion. If DeMint triumphs in November, his supporters say, he would embolden all conservatives to push for dramatic changes in Social Security and tax laws, while holding firm on free trade.

"There's a lot of excitement for DeMint," said economist Dan Mitchell of the conservative Heritage Foundation, "because he's not only someone who believes in individual freedoms and the free market, but he would actually fight for them. That's what's missing on Capitol Hill."

The conservative Club for Growth has pumped $500,000 into DeMint's quest for the nomination, and has pledged to make him a national figure if he prevails.

"This election is about more than Jim DeMint," said Stephen Moore, the political action committee's president. "It's about these core issues of the Republican Party."

But South Carolinians may see the race differently, largely because hardly any of them know of DeMint's unorthodox views, said Neal D. Thigpen, a political scientist at Francis Marion University, in Florence, S.C. "He comes across as competent and steady, but he's no maverick," said Thigpen, a longtime watcher of South Carolina politics, who had no idea of DeMint's views on taxes and Social Security. "That's not what he's selling, and it's certainly not the way he's perceived."

And DeMint appears to be doing his best to keep it that way.

"That's not an argument I'm going to win on the campaign trail," he said of his ideas on taxes.

So we just won't mention it? We'll campaign for the US Senate without telling people what we intend to do because if they knew what it was we might not get elected?

So we've now reached the point where they're bragging about keeping their true agenda hidden from the people they're asking to vote for them. Sweet. Want a little taste of that agenda?


But DeMint's position on taxes may be his most unorthodox, and the most invisible to his would-be voters, suggested Robert Botsch, a political scientist at the University of South Carolina at Aiken. In speeches and interviews in Washington, DeMint has lamented what he calls "an eleventh-hour crisis in our democracy" -- that many of the beneficiaries of federal social welfare largesse pay little or no federal income taxes.

"How can a free nation survive when a majority of its citizens, now dependent on government services, no longer have the incentive to restrain the growth of government?" he asked during a Heritage Foundation lecture in 2001. His prescription? "We must have a new tax code that allows all voters to see and feel the cost of government," he counseled. "Using the tax code to help low-income workers only disconnects them from the responsibilities of freedom."

While letting corporations use the tax code to help themselves doesn't "disconnect them from the responsibilities of freedom"?

What's remarkable here is the "disconnect" of DeMint from any sort of sane or logical thinking. It's pure, unadulterated fantasy, and in a state that's as poor as South Carolina, it's not a fantasy that's likely to play very well outside the extremist radcon core.


But under such a plan, those just above the poverty line likely would see a substantial tax increase. That might not go over well in South Carolina, where nearly a third of the population lives on incomes twice the poverty level or less.

So far, DeMint has not pushed the issue. "It's an intellectual argument, and political reporters don't want to talk about substance," he said. "They'd just say DeMint wants to make the poor pay more taxes."

And, he said, if he wins the nomination, he is not likely to bring it up against his Democratic challenger, state Superintendent of Education Inez Tenenbaum.

No, I just bet he won't. But she will.

This is what we're up against--a mindset that thinks we aren't paying enough and the rich are paying too much. This shows that the so-called "anti-tax" stance of the extreme right is really a "Don't tax the rich, tax the poor" program: they think taxes are fine as long as they're not the ones paying them.

I have to keep asking myself, is America really this mean? this selfish? this cruel? this stoopid?

If the DeMints win in November, the answer may be "Yes."

Class Warfare in America by Bill Moyers

In a recent speech, Bill Moyers summed up a lot of what we're trying to say here--that a class war has been initiated by the corporate ruling class and the religious right with the aid of the media and politicians across the political spectrum, that this war has been nearly won (he points out later that Warren Buffet thinks it has been won), and that this war has serious, long term and lethal effects on the poor, on the middle class, on the economy, and on our democracy.

He's right. I said the same things in my first Commentary:
Those of us at the bottom of the income scale are involved in a war. It is not a war of bullets, mortar shells, bombs and tanks, but it is a war just the same, and people are dying. We didn't start this war. It is not a war with us but a war on us. We didn't ask for it, we don't want it, and if we could we'd sue for peace. It is not a war we can win in any final way, ever. We are outgunned, overmatched, and trapped in a swamp. The enemy controls our food, our shelter, our health, and our livelihoods. He rarely shows pity, breaks every truce within hours, and chips away at us every day as if we were emotionless blocks of ice he is hoping to whittle down until we just melt away.
I know this not because, like Mr Moyers, I have studied it, but because I live it. Every day.

It's a long speech, so I'm going to cut it up into shorter segments and post it over the next few days. Read it at your leisure, but read it and think about it. Those of us on the bottom are just the canaries in the coal mine; this poison gas is going to infect the whole society--if it hasn't already--and when it does, it won't just be us who will be dying. As the oligarchs consolidate their power, everybody's head is going to be on their chopping block.


It is important from time to time to remember that some things are worth getting mad about.

Here's one: On March 10 of this year, on page B8, with a headline that stretched across all six columns, The New York Times reported that tuition in the city's elite private schools would hit $26,000 for the coming school year -- for kindergarten as well as high school. On the same page, under a two-column headline, Michael Wineraub wrote about a school in nearby Mount Vernon, the first stop out of the Bronx, with a student body that is 97 percent black. It is the poorest school in the town: nine out of ten children qualify for free lunches; one out of 10 lives in a homeless shelter. During black history month this past February, a sixth grader wanted to write a report on Langston Hughes. There were no books on Langston Hughes in the library -- no books about the great poet, nor any of his poems. There is only one book in the library on Frederick Douglass. None on Rosa Parks, Josephine Baker, Leontyne Price, or other giants like them in the modern era. In fact, except for a few Newberry Award books the librarian bought with her own money, the library is mostly old books -- largely from the 1950s and 60s when the school was all white. A 1960 child's primer on work begins with a youngster learning how to be a telegraph delivery boy. All the workers in the book -- the dry cleaner, the deliveryman, the cleaning lady -- are white. There's a 1967 book about telephones which says: "when you phone you usually dial the number. But on some new phones you can push buttons." The newest encyclopedia dates from l991, with two volumes -- "b" and "r" -- missing. There is no card catalog in the library -- no index cards or computer.

Something to get mad about.

As always, if you want to read the whole thing, click the title. If something in the excerpt above moves you or surprises you, leave a comment. We need to start talking about this stuff. We need to understand it. Most of all, we need to acknowledge that it's happening and determine to do something about it.

(Many thanks to Jamison of BiteSoundBite for the link.

And Welcome to Phaedrus, who has officially joined FTT and will be posting here periodically as time and circumstances permit.)



Saturday, June 19, 2004

Proud To Be An American

U.S. Lags In 'Legal' Time Off
U.S. workers have fewer legal rights to time off for family matters than workers in most other countries, and rank near the bottom in pregnancy and sick leave, a Harvard School of Public Health study found.
But then, the US lags on nearly every measure of worker rights. But we've got the world's highest per capita income, and we brag about it constantly, despite the fact that it's a meaningless statistic for most people.

Kerry Calls for Raising Minimum Wage

BY Michael Finnegan, LA Times Staff Writer


ALEXANDRIA, Va. — Sen. John F. Kerry called Friday for raising the federal minimum wage to $7 an hour, saying the move would help millions of Americans, particularly women, "break out of poverty."

Kerry, winding up a week focused almost entirely on his appeal to the middle class, contrasted his wage proposal with the tax cuts that President Bush has made a centerpiece of his reelection effort.

Speaking to nearly 100 guests at a labor-union forum in this Washington, D.C., suburb, he said Bush "put wealth ahead of work" with tax cuts skewed to rich Americans who don't need them.

"The wealthy folks are the ones who walked away with the biggest grab bag for nothing, while the people who are trying to work hard are doing worse," Kerry said. "They've put something-for-nothing ahead of responsibility."

The Massachusetts senator has long advocated a higher minimum wage, a Democratic Party staple. But on Friday, he announced that one of his first acts as president would be to push to raise it from $5.15 to $7 an hour by 2007.

The federal minimum wage would rise at the rate of inflation after that, Kerry spokesman David Wade said.

A dozen states have already enacted higher minimum wages, including California, where it is $6.75 an hour. The last rise in the federal minimum wage was in 1997, when it went from $4.75 to $5.15 an hour.

At the labor forum in Alexandria, Kerry lamented the decline of living standards for the poorest working Americans. Adjusted for inflation, the minimum wage has sunk to its lowest level since 1949, he said.

"Don't you think … that if a president could go out and fight for four years to provide over a trillion dollars in tax cuts to the wealthiest people in America, we can fight for a few months to raise the minimum wage for the poorest people in America?" he asked.

It's a good question, a fair question, and I'm glad he asked it--it's about time somebody did. And I certainly appreciate his proposal for raising the minimum wage and his historical support for it going back years. But if Sen Kerry thinks $7/hr is going to help anybody 'break out of poverty', then he is as out-of-touch as Bush. For a 40-hr week, that's $280 gross, about $200 after taxes--still well below the poverty line. It means that in all but the states with the lowest SOLs, you can eat but you can't pay the rent, or you can pay the rent as long as you don't eat one week out of three.

Sen Kerry is willing to take a good long step toward a living wage and should be applauded for it, but he also needs to remember: it's just a step.

Friday, June 18, 2004

Police seek leads in torching of homeless man

'cul' at ratboy's anvil dug out a horrifying story that is suprisingly unsurprising.

CORPUS CHRISTI, Texas — Police searching for leads turned to local news stations for help Thursday, asking them to air a videotaped torching of a homeless man who was sleeping on a bench. The videotape of the Tuesday night attack is of poor quality but shows six to eight people get out of cars, approach the sleeping man, then flee after flames appear.

"Then you see our victim kind of running around in a circle, flailing his arms and trying to put himself out," Corpus Christi Police Lt. Rocky Vipond said.

Three stations in Corpus Christi aired the footage.

Lucas Adama Wiser, 21, remained in an intensive care Thursday with third-degree burns.

"We're hoping someone might recognize that vehicle and possibly the group of guys," Vipond said. "I don't know if this was a joke that they thought they were playing on somebody or what their mind-set was, but it was a pretty sick joke."

Police could not read the license plates or determine the approximate ages or ethnicities of the attackers. Investigators said they had not yet questioned Wiser because he was on heavy painkillers.

Vipond said there had been a few reports of other assaults on homeless people in the city, but it was premature to say if they were related.

The attack was caught by a video camera outside Corpus Christi Metro Ministries, a private charity.

The Rev. Robert Trache, director of Metro Ministries, said the incident was at least the third against homeless people in a 24-hour period. He said one person was dragged along the street, another person was beaten with a belt buckle. He said both incidents involved "groups of young people."

He said it prompted an emergency meeting Wednesday of caregivers around the city.

"We were concerned this was beginning to be a pattern," he said. "My gut feeling is that there are people who sometimes decide that they will become vigilantes and attack people ... and view this as a civic good when it's really a crime."

He said there were an estimated 5,000 homeless in the city of about 300,000.

This comes via Phaedrus at No Fear of Freedom, of course, and, of course, he wrote a piece on the evil event that I can't improve on.

In order to claim that progressive taxation is theft, you have to insist that everyone earns everything that happens to them. The poor are poor because they're bad people who make bad decisions. The rich are rich because they're really good people who make really good decisions. The effects of luck and society are negligible at best. If you can't assign to the individual total responsibility for everything that happens in his life, then you can't assert that the rich have an absolute right to keep their money.

You have to insist that this is as just a society as it possibly can be. This is critically important. If all of this isn't true, then it's easy to morally justify a progressive tax in order to redress injustice.

I don't know what happened in this individual case of course, but there have been many attacks on the homeless and other poor and immigrants and what have you. Do I think that David Brooks or Rush or the Savage would torch a homeless man? To tell you the truth, it's not something I spend a whole lot of time thinking about, but I suppose if one of them did I'd be very surprised. However, most, if not all, human behavior exists on a continuum, with the Mother Teresas and Ghandis near one end, I suppose people like Torquemada on the other. Brooks is at least a little bit mean, Limbaugh meaner, Savage meaner than that.

Some people are so mean that they'd torch a homeless person purely for fun regardless of the social atmosphere. But some people are only mean enough to do it if they think homeless people are bad people. And the right is telling them that the homeless are bad people.

Far as I'm concerned, the right is sacrificing the poor and homeless on the altar of Mammon. I really hope they have to explain that to their vengeful God one day.

Amen.

Thursday, June 17, 2004

Waste and Fraud Besiege U.S. Program to Link Poor Schools to Internet

By SAM DILLON

Published: NY Times, June 17, 2004

WASHINGTON, June 16 - When the El Paso school system wanted to upgrade its Internet connections three years ago, it tapped into a federal program that offers assistance for such projects.

The program paid the International Business Machines Corporation $35 million to build a network powerful enough to serve a small city. But the network would be so sophisticated that the 90-school district could not run it without help.

Foreseeing the problem, I.B.M. charged the district an additional $27 million, paid by the federal program, to build a lavish maintenance call-in center to keep the network running. The center operated for nine months. Then, with no more money to support it, I.B.M. dismantled it and left town.

The federal effort to help poor schools connect to the Internet, the E-rate program, which collects a fee from all American phone users to distribute $2.25 billion a year to such schools and libraries, wasted enormous sums as El Paso built its extravagant network in the 2001-2 school year, according to documents and federal lawmakers.

But the problems have not been there alone. In Brevard County, Fla., school officials used E-rate money to install a $1 million network server, a powerful device more suited to the needs of a multinational corporation, in a 650-pupil elementary school. And just three weeks ago in San Francisco, a subsidiary of the computer giant NEC agreed to plead guilty to two federal felony counts related to the program.

Across the nation in recent months - in El Paso and in New York and Pennsylvania, in Puerto Rico and Atlanta, in Milwaukee and Chicago - investigations or audits of the program have turned up not only waste but also bid-rigging and other fraud, according to lawmakers and investigators. A report issued last week by the Federal Communications Commission, which oversees the E-rate program, said 42 criminal investigations were under way.

On Thursday, Congress is to open hearings on all that has gone wrong. The hearings will be held by the House Energy and Commerce Subcommittee on Oversight and Investigations, whose chairman, Representative James C. Greenwood of Pennsylvania, says the F.C.C.'s supervision was weak.

Mr. Greenwood said that since schools often must pay only 10 percent of the cost of equipment and services while E-rate picks up the rest, "contractors have mastered the art of coming into these districts, recommending gold-plated architecture, and school officials, buying at 10 cents on the dollar, take everything they recommend.'

'The F.C.C.'s supervision was weak'? Weak? It wasn't weak, it was non-existent. Michael Powell's FCC never saw a corporate thief without offering to hold the swag-bag for it and shield it from the cops. Once again, corporate greed trumps social need and the US Treasury becomes nothing more than a cash cow for corporate profits at the expense of one of the few remaining programs meant to help less rich schools keep up with technology.

There is simply no shame any more.

College Crisis in California

It seems like whenever a state has a fiscal crisis, education funds are at the top of the list for cuts. The budget crunch in California--which is being repeated all across the nation--has 'necessitated' large-scale cuts in funding for community colleges just at a time when one of the largest classes in CA history is graduating.

The report [by the National Center for Public Policy and Higher Education] criticizes the state for abdicating its responsibility to prepare for the new tidal wave of new college students -- more than 700,000 high school graduates bound for college from last year to the end of the decade. Most are Latino, and many will be the first in their families to attend college. And although three-fourths of them are headed for community colleges, those systems are not currently funded to serve their existing base of students, the report concludes.

``We saw these students coming; everyone knew they were there,'' said Patrick Callan, president of the National Center for Public Policy and Higher Education.

Yet increased demand and shrinking state support have resulted in an estimated 175,000 students forgoing community colleges in recent years and an estimated 25,000 eligible students being turned away from California State University and University of California systems for the coming year, according to the report.

``Multiply that by another five or six years and you will have an educational and economic catastrophe for California,'' Callan said.

The good news is that a coalition of business, labor and community groups are beginning to grapple with the problem that the State government has ignored, although nothing they've proposed will solve the problem by itself. But the question is: why is this happening?

It's happening, at least in part, because California was raped mercilessly by the Texas energy industry, who stole--that's the only word for it--$$billions$$ from CA's treasury by creating phony shortages to justify massive increases in their prices--as much as $250/kilowatt-hr. That crime all but emptied CA's coffers at a time when other factors were putting enormous pressure on the budget. CA was deeply in the red and cuts had to be made.

This is an over-simplified picture, I realize, but there's no getting around the fact that much less harsh cuts would have had to be made were it not for the embezzlement by Texas' energy corps. That money, despite CA's slam-dunk lawsuit, will likely never be recovered. So who is paying for this theft? The ones who usually pay for it--kids.

Community colleges are magnets for poor, low-income, and minority kids who want to make their lives better because they're affordable. Without the community colleges, these kids are cut off from a chance for a brighter future. Is the fact that they are poor and often minority the reason this problem has been ignored until now? Is this a class and race war all at once? I'd hate to think these kids were the ones the state legislature voted to dump on because Latinos don't count....

Tuesday, June 15, 2004

Unemployment numbers

According to the US Department of Labor’s Bureau of Labor Statistics the official seasonally adjusted unemployment rate for May 2004 was 5.6 percent. We all know that the unemployment rate is not based on an actual count of not working people; it’s based on a formula that approximates the number of people that fit in a category called “unemployed.” According to the Bureau of Labor Statistics’ website, “Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work.”

The Bureau tweaks the formula from time to time, but at no point does it ever measure the number of people who actually want work. No one knows what the real number is, except to say that it is bigger than the official unemployment rate. So far this is all old news. What’s new to me is the fact that the Bureau does attempt to produce a more accurate number. The May 2004 report includes something at the back called “Table A-12. Alternative measures of labor underutilization.” In this table they show six different ways of calculating unemployment.

The official count is number three on the table—5.6 percent last month. Methods one and two give a rosier picture. Method four adds the “permanently discouraged” and raises the total to 5.9. Method five adds the “permanently discouraged” and the “other marginally attached” (persons who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the recent past). This raises the rate to 6.6. Method six adds in people who want full-time work but have had to settle for part-time, which brings us up to 9.7 percent of the labor force. How they calculate what qualifies as “the labor force” is a question for another time.

I don’t have a profound point to make out of all of this. This is just me discovering something I didn’t know. I’ve never actually read a US unemployment report (oddly, I have read Serbian ones), but I will be going back each month to check out table 12 and get a better idea of how things are.

Monday, June 14, 2004

Some Things Work 2

Health Initiative working, study says

PROGRAM PROVIDES INSURANCE FOR 29,000 IN TWO YEARS

By Frank Sweeney

Mercury News

Santa Clara County's Children's Health Initiative has proven far more successful than expected, providing insurance coverage for more than 29,000 youngsters in its first two years, according to an analysis of the program released today.

Launched 3 1/2 years ago to extend health coverage to uninsured children, the initiative spurred large enrollment increases for two major public health programs funded by state and federal governments -- Medi-Cal and Healthy Families.

And it enrolled more than 15,000 children in the county-funded Healthy Kids program, designed to reach children who are either undocumented immigrants or whose families make too much money to qualify for the government-subsidized programs.

``It's rather extraordinary. It's a tremendous success,'' said Joseph Macrum, spokesman for the Santa Clara Family Health Plan, a county agency that runs the initiative programs.

For single mothers such as Celia Gonzalez of San Jose, the program is the only way she can get health coverage for her 13-year-old son, Erick Villasenor, and her 3-year-old daughter, Valerie DeLatorre.

``This is absolutely the best way to get health care,'' she said in Spanish, speaking through an interpreter at the Family Resource Center on South White Road in East San Jose, where people can enroll in the programs.

``This is absolutely the best way to get health care,'' she said in Spanish, speaking through an interpreter at the Family Resource Center on South White Road in East San Jose, where people can enroll in the programs.

She heard about the initiative from friends and saw advertisements, then enrolled two years ago, she said. Before then, she had to take her children to emergency rooms, which she said was ``very difficult.''

``I had to pay the doctor at the point of treatment. Just a simple consultation was $150, and then you have to buy the medicines,'' said Gonzalez, who works as a waitress.

There are some things government has to do because nobody else can--or will. Santa Clara County defined a crying need in its poorest population--lack of medical insurance for kids--and instead of turning their backs or cutting their budget or blaming the population itself for being too poor to afford the insurance, they did something about it, and what they did worked.

Is Santa Clara County richer than every other county in the US? No. It's priorities are different. It recognized that it was less expensive in the long run to provide affordable health care to its low income population than it was to have them filling up hospital emergency rooms that then had to be subsidized to keep them from going under. The Santa Clara County Program was developed by a coalition of organizations, agencies, and businesses (click the title and read the rest of the article) and funded by the tobacco tax. If they can do it, other counties--and states--can do it.

Why aren't they?

Sunday, June 13, 2004

Bracing for a strike

My part of the country is bracing for a contract confrontation between the same antagonists that led to the California grocery strike last winter. Since that strike the three national grocery chains, Safeway, Albertson’s, and Kroger’s, have negotiated a number of contracts with local grocery unions. In each case the chains have offered essentially the same deal that was offered in California. In Western Washington the contracts expired at the end of April, and negotiations have carried on while the workers continue to work under the old contract.

Negotiators have extended talks for a new labor contract at the Puget Sound region's four largest grocery chains into early July, delaying the prospect of a possible strike or lockout.

The current contract, which had been set to expire in early May, has been extended twice in the past month as the two sides bargain over health benefits and wages for more than 16,000 workers at Safeway, Albertsons, QFC and Fred Meyer.

QFC and Fred Meyer grocery stores are owned by Kroger, The third national chain involved in the California strike.

Late last week, representatives of the grocery chains and the United Food and Commercial Workers extended the contract for three more weeks and agreed to meet six more times, with talks resuming Monday and scheduled to continue through July 7.

[…]

As in California, the key issue is health-care costs, which the group of employers says have jumped more than 73 percent since the last contract was negotiated in 2001. The companies pay 100 percent of workers' health-care premiums. Employees cover co-pays and deductibles.

The grocers' initial proposal for the new contract called for employees to pay a share of their health-care premiums.

It also proposed a two-tier salary system in which new employees would be paid less than veterans. Union officials said the proposal amounted to $500 million in cuts over the three-year contract.

On Friday, the UFCW submitted a counterproposal that it said would save companies $120 million by, among other things, increasing employees' co-pays and assigning new hires to an HMO for their first year of coverage.

"It's a start — and a good start," said Melinda Merrill, a spokeswoman for the grocery chains. "Their proposal acknowledges that there needs to be changes, and that really is encouraging. The employers still want to explore ways to lower the cost of health benefits, but this is a good step."

Sharon McCann, president of UFCW Local 1105, said she is disappointed that the grocery chains haven't embraced the union's latest offer or amended their initial proposal.

Merrill, the spokeswoman for the grocery chains, makes it sound like they are thoughtfully considering the union’s offer, but I notice they have turned up the pressure on the employees in the stores. For about two weeks the chains have been advertising to hire scab workers. Seattle has higher than average unemployment so they probably have no trouble finding takers. Today I went to my neighborhood QFC to pick up a few things and saw a sign, prominently placed in the aisle where it was visible from the checkstands advertising for hire scab workers to apply with the store manager.

My first though was that this is a pretty crude intimidation tactic. I still think it is, but there is an uglier, more subtle element. Most of the management in the stores (as opposed to at the corporate offices) is made up of people promoted from the ranks. These people have far stronger ties to the union employees than to the owners and corporate staff who they hardly ever see. Having the store managers interview scabs where the union employees can see them, serves to separate the two groups of store workers even before the strike.

Fortunately, the union is not without its own resources.


The strike and the picket line are labor's best-known tools for exerting pressure on employers in a contract negotiation. But the strike (or, from an employers' point of view, the lockout) is a high-risk proposition; once workers walk out (or are locked out) the dispute takes on an unpredictable momentum beyond the control of either party, with the potential for disaster for both. In such cases strikes aren't ended by negotiation so much as they're ended by exhaustion on both sides, who are left to convince themselves and the public that they didn't lose as much as the other guy.

The picket line is meant to convey a message to the public of the workers' cause and to deter the public from patronizing the business. But a good portion of the public these days, not belonging to a union or not having grown up in the tradition, is indifferent to the picket line; another segment is openly hostile toward unions and their cause.

[…]

The me-too agreement isn't a cure-all for these problems. But it does have some attractions that make it intriguing to labor unions such as the United Food and Commercial Workers, which represents grocery store employees.
Me-too agreements work like this: In situations where there are contracts covering multiple employers in the same industry expiring at roughly the same time, the union and some of those employers will negotiate a sort of contract in advance. That contract says that the union won't strike those employers should there be a walkout. In turn, those employers agree to offer to their workers whatever is the industrywide or regionwide settlement agreed to by the largest employers.

UFCW locals in the Puget Sound region have been announcing me-too agreements with such smaller chains and independents as Town & Country Markets (Ballard, Greenwood and Shoreline Central markets), Metropolitan Markets, Market Place, Thriftway, Red Apple and Market Place stores.

For unions, me-toos have the attraction of preserving whatever benefits there are to multiemployer bargaining (keeping everyone at roughly the same wage scale) with whatever leverage can be extracted from a divide-and-conquer approach. In negotiations such as the grocery industry, local and regional labor unions are going up against national operations (Kroger, Safeway, Albertsons). The notion that their competitors will be operating unfettered while they're being struck may be a counterbalance to that disparity of size.

For the smaller grocery operations who agree to me-toos, the benefits include being able to operate without the cost and hassle of a strike should one occur, and maybe even pick up some new customers.

Two of the smaller chains have branches close to my home. My normal shopping habit is to spread the wealth around, so I know these stores well and will have no problem transferring the portion of my business that QFC gets to the others. The only question is, if it comes to a strike would I ever transfer my business back to QFC afterwards.