AFL-CIO

Will Public Outrage Finally Force the President and the States to Prosecute Outlaw Bankers?

Richard Eskow — Wed, 21 Dec 2011 12:00:16 -0500

The President has adopted the language of the 99%, and it's paying off for him. He's surged from a position slightly behind Mitt Romney in last month'sCNN polling to a 52%-45% lead against the Republican this week. While other factors were involved, his new rhetoric about income inequality and forcing everybody to "play by the same rules" resonated especially well with voters who have seen their government enforce one rule of conduct for Wall Street and another for the rest of us.

Unfortunately, his Administration hasn’t backed up that rhetoric with action. It has steadfastly refused to investigate and prosecute the bank crimes who brought this economy to its knees. So have the chief law enforcement officials for most states. Instead they’re trying to cut sweetheart deals that would let crooked bankers go with a slap on the wrist.

People are getting fed up. Grassroots outrage against the lack of prosecutions is giving rise to organized citizen action who are protesting these injustices under a "fair settlement" banner. Will this public backlash become strong enough to finally force national and state governments to enforce the law and protect the economy?

The Excuse Makers

If excuses were investigations there'd be justice for everyone. But only a handful of state Attorneys General, led by New York's Eric Schneiderman, have been willing to stand up to big bankers and their friends in high places. The President himself has been serving as Excuse Maker-in-Chief, as when he told 60 Minutes that “Some of the most damaging behavior on Wall Street, in some cases, some of the least ethical behavior on Wall Street, wasn’t illegal."

That's right, of course, in a literal "what the meaning of 'is' is" sense.. Some of the damaging behavior wasn't illegal. And some car accidents aren't caused by drunk drivers. But many, if not most of them, are. If a country road was littered with whisky bottles and corpses, and the county sheriff hadn't booked anyone for a DUI in three years, people would be asking why he's not doing his job.

That's what many people are asking about this President and his Justice Department.

You can't set your foot down around this place without stepping in excuses. Another Administration official told a bank-friendly reporter at the Wall Street Journal that it’s too difficcult to win convictions for crimes that are as as complicated as banking fraud. “Our job is too hard,” the Justice Department seems to be saying.

But it wasn’t too hard in the 1980s, when a fairly bank-friendly President named Ronald Reagan was running the Federal government. More than 1,000 bankers were convicted in the Savings & Loan scandal for crimes that were very similar to the ones that led to the 2008 financial crisis. A man named Bill Black led the investigations that resulted in those convictions, and the Obama Justice Department hasn’t even asked for his advice.

It isn’t hard for juries to understand lying, either, and stock fraud is usually a case of somebody lying to someone else. There seem to be some pretty clear-cut cases of it lying around waiting to be prosecuted. There is widely documented fraud involving false title documents submitted in foreclosure proceedings; several big banks have already admitted to illegally foreclosing on military families,and investigations show that nearly 5,000 military families may have been illegally evicted; and there's very compelling evidence regarding my former employer AIG.

And it isn’t hard to understand widespread and organized rings designed to forge court documents, commit perjury, and evade state taxes. And yet that’s exactly what big banks did in order to commit massive foreclosure fraud on US homeowners.

The Doers

People who are familiar with Wall Street fraud have come to believe that the Obama Justice Department just doesn’t want to investigate and prosecute bankers.It's gone to great lengths to avoid prosecuting them. In fact, that’s become so clear to Steve Linnick, Inspector General of the Federal Housing Finance Agency, that he’s stopped referring potential criminal cases to the Justice Department at all. Instead he’s started sending them to Mr. Schneiderman, who has broad power to bring prosecute financial wrongdoing under a 1927 New York law called the Martin Act.

There is one Attorney General for each of the fifty states. Each of them has the ability to prosecute the crimes committed by banks in their own jurisdictions. They can also cooperate with Mr. Schneiderman, whose authority under the Martin Act extends across state lines. That power gives state AGs another tool for protecting their state’s residents from fraud and bringing criminal bankers to justice.

And yet, only a handful of brave Attorneys General are willing to enforce the law against bankers. In one way or another, Schneiderman’s battle is also being waged by Martha Coakley in Massachusetts, Kamala Harris of California, Beau Biden of Delaware, Jack Conway of Kentucky, and Catherine Cortez Masto of Nevada.

That leaves forty-two other states whose AGs are refusing to enforce the law. And the Obama Administration isn’t content to just let bad bankers go free to commit more crimes. It’s also pressuring the AGs to accept a cushy deal with the banks that would leave crimes unpunished, homeowners unsafe, and bank fraud victims uncompensated.

The People

It’s been a long time coming, but the backlash is here. Occupy Wall Street lit the fire with its “one demand” – an end to the insanity and a realization that bankers and other oligarchs rule the economy like a medieval fiefdom. And now the demand for economic justice is reaching into state governments and the Department of Justice.

A loose coalition of groups is demanding that more Attorneys General prosecute of bank crimes aggressively, offering support for those who are already moving, and calling on the states to reject the cushy deal that the Federal government and some of the AGs are trying to cut with the banks.

Independent citizen groups and progressive organizations are forming alliances at the state level with unions like the AFL-CIO and SEIU, as well as groups such as Clergy and Laity for Economic Justice. Californians for a Fair Settlement, Pennsyvanians for a Fair Settlement, Nevadans for a Fair Settlement and other state teams have begun putting pressure on each state’s Attorney General to reject the Administration-backed deal and immediately begin aggressive investigations and prosecutions.

Like David Dayen, I’m hesitant to embrace the “fair settlement” framing completely until some of those investigations are further along. Based on the overwhelming evidence we’ve seen so far, a truly fair resolution will probably involve handcuffs, orange jumpsuits, and perp walks along with a financial deal. Financial restitution will need to include, at a minimum:

substantial principal reductions for underwater homeowners, along with lower interest rates;
a breakup or restructuring of the “MERS” shell game so that it no longer enables deceit, tax evasion, and the conversion of home mortgages from a two-party contract to a commodity bankers can trade and sell without regard to property rights;
the right to rent a home that has become distressed; and,
a loan modification facility that is not administered by the banks themselves.

“Fair Settlement” is a good enough umbrella under which to place these demands, as long as it’s clear that prosecutions and real restitution are vital elements of fairness. The question now is, How strong will this movement become? Will the public back these groups in demanding justice and rejecting any more cushy bank deals? If they don’t, the country will have serious problems in the years to come.

The President is enjoying the fruits of his rhetoric this week, and it's ecellent rhetoric. But he'll need to match his words to his deeds if he wants the rewards to continue, and that means directing his Justice Department to drop the cushy bank agreement and start prosecuting Wall Street wrongdoers. And voters are likely to be unforgiving of state politicians who won the office of Attorney General by promising to uphold the law and then turn a blind eye to "wrong" acts by the "right" people.

It’s bad enough to watch powerful people break the law with impunity, shatter the economy, get rescued with taxpayer dollars, and then get to scoff at the law as they walk away unpunished. Here’s what’s even worse: If they’re not brought to justice, they’ll do it again.

Years of Discontent Trigger American Autumn

Leo Gerard — Fri, 07 Oct 2011 11:15:10 -0400

To convey the significance of the Occupy Wall Street movement, NBC News anchor Brian Williams this week quoted the 1960s Buffalo Springfield song, For What It’s Worth:

“There is something happening here. What it is ain't exactly clear.”

Maybe it’s unclear what the Occupy Wall Street movement ultimately will accomplish. But what’s happening – for the past three weeks in New York and now in hundreds of towns across North America – is a roiling, inspirational, grassroots expression of anger, disgust and revolution.

And, frankly, given what’s been going on in the United States since the bank bailout, it’s amazing that this uprising didn’t precede the Arab Spring. The powers-that-be, from the rich and influential to their coin-operated politicians and corporate-owned media, have mocked and belittled and ignored the protesters, the 99 percenters as they call themselves – everyone but the richest one percent. No matter what the critics say, these young people, with righteous outrage and new age communication, have launched the American Autumn.

This revolt could have started in the spring of 2009, immediately after the Bush administration pushed through Congress the Troubled Asset Relieve Program (TARP), the $700 billion in taxpayer money spent to prop up banks that had gambled and lost untold trillions. A Bloomberg News investigation later would show that the United States lent, spent or guaranteed as much as $12.8 trillion to save the banks. Despite that help, the Wall Street recklessness ruined the American economy, throwing tens of millions out of jobs and homes.

Poverty and hunger skyrocketed in the richest country in the world. As tax revenue fell, states, towns and school districts slashed essential public services and laid off teachers, librarians, firefighters and police officers.

Maybe it just took this long for the middle class to grasp all the horrible effects of the Wall Street gambling and to realize that a government held hostage by country club conservatives bent on cutting public services just made matters worse. Maybe young people looked at unrestrained war spending, Pell Grant slashing and voter disenfranchising and decided they were fed up and not going to take foreclosure of their futures anymore.

Whatever the spark, the American Autumn began three weeks ago in New York City’s Zuccotti Park, formerly Liberty Square. Late in September, some of the one percenters sipped Champaign on an upscale restaurant balcony as they looked down on the protesters in the streets below. This week, as protests spread, wealthy risk-takers at the Chicago Board of Trade put signs in the windows of their ritzy offices bragging, “We are the 1 percent.” They don’t get it.

Nor does Bank of America. Here’s a bank bailed out by taxpayers that just announced it would begin imposing a new fee – $5 a month, $60 a year – on debit card users. This bank also just announced that it would worsen the recession caused by bankster recklessness by laying off 30,000 workers.

This is a bank that engaged in the habitual, anti-capitalistic Wall Street practice of rewarding poor executive performance by giving its CEO Brian T. Moynihan a $9 million bonus immediately after the institution he runs lost $2.2 billion in 2010. Moynihan responded to criticism of the $5 fee by saying customers – and ultimately taxpayers -- must line his pockets and that of shareholders, regardless of how badly he runs the bank or how stupidly he gambles with its money. That’s because, he asserted, the bank has a “right to make a profit.” No matter what.

The media and country club conservatives belittled the protesters. Here’s what Herman Cain, a Tea Partier seeking the GOP nomination for president, said:

“Don’t blame Wall Street, don’t blame the big banks if you don’t have a job or you’re not rich. Blame yourself!”

He continued:

“It’s not a person’s fault because they succeeded. It’s a person’s fault if they failed. And so this is why I don’t understand these demonstrations and what it is that they’re looking for.”

He called the protesters “anti-capitalist,” although it was the banks that sought a socialist bailout from the government when they got themselves in trouble.

Cain didn’t blame banksters for unemployment, even though it was Wall Street gambling that took down the economy. He blames the teachers and police officers thrown out of work by local governments that are cash-strapped as a result of the recession -- caused by Wall Street recklessness.

Cain and the media keep saying they don’t understand what the protesters want. They just don’t get it.

A specific list of demands is unnecessary. What the 99 percenters want is obvious. They want the American dream restored. Good public education for everyone. Equity in opportunity. Shared sacrifice so that the rich pay a tax rate at least equal to that charged the middle class. An end to poverty and unemployment in the richest country in the world.

In the Buffalo Springfield song, For What It’s Worth, lyrics talk of 1960s youths criticized for their protests:

“Young people speaking their minds
Getting so much resistance from behind.”

This time protesters will get backing. The members of my union, the United Steelworkers, get it. Members of the unions of the AFL-CIO and Change to Win federations get it.

We’re here to support the young people of the American Autumn.

Music For Madison: Steve Earle Steps Up (With a Digression About the Fall of Communism)

Richard Eskow — Thu, 17 Mar 2011 03:19:19 -0400

Steve Earle, who's hands-down one of the best songwriters of our time, has re-released two union-themed songs on iTunes to support the Madison protesters. “Harlan Man” and “The Mountain” are being issued as a special "2-track digital single" (I didn't know you could do that), with all proceeds going to The America Votes Labor Unity Fund, through SaveWorkers.org.

“Unions are a fundamental component of democracy throughout the free world," said Steve." All eyes are on Wisconsin.” I'll go with that.

In fact, I was thinking about exactly that earlier today - unions and democracy, I mean. I was working with USAID and the State Department when the Communist countries were changing over back in the early nineties. I went to the Silesian mountains in Poland back then to talk to the Solidarity folks about financing a health care plan for the workers. I spent a lot of time in Hungary, Czechoslovakia, even Albania when it was first opened up after forty years as a "garrison state." That was under the first President Bush.

And I was just thinking today how funny it is how some of the people who got so excited about the unions over there are working as hard as they can to destroy the unions over here. You should have seen them: They had Solidarity coffee cups, Solidarity posters in the original Polish ... they had everything material you could acquire that had anything to do with "solidarity."

They just didn't have solidarity, if you know what I mean.

I was in Prague once with a World Bank mission, and on our way home from dinner a group of us saw two young girls playing guitars for spare change. My companions bribed them into letting me play the guitar and sing with them. I don't want to brag, but we made some really good money. They didn't want me to leave. (To be completely honest,, there wasn't a lot of competition on the street that night.)

The only problem with singing for a group of non-musical people from a lot of different countries, like the people on that mission, is that at least back in the nineties you would almost be forced at gunpoint to take a crack at singing "Hotel California" or "Country Roads." On another trip I heard a Hungarian country band play Merle Haggard songs for Mossbacher, Bush's Secretary of Commerce (I forget his first name, although I shook his hand. He was all hair and teeth and tan, like all these guys are.). The event was a "Texas style barbecue" in Mossbacher's honor at an ancient fort overlooking the Danube.

Life throws some weird curves at you sometimes.

Anyway, back to Steve: The songs are from the bluegrass album he did with Del McCoury and his band back in 1999. The whole album's great. Earle's got an uncanny way of writing original songs that sound about 150 years old. (You should hear Levon Helm sing "The Mountain," too. He was born to do it.)

Both songs deal with life as a (union) miner, so you can buy the single for the mineworker in your life.

According to the press release, "The America Votes Labor Unity Fund is the fiscal agent of the AFL-CIO State Unity Fund, a special account of the AFL-CIO and directed by a broad coalition of national labor organizations ... The America Votes Labor Unity Fund united labor organizations, allied progressive groups and individuals to fight for workers -- on the ground and on the airwaves. Contributions help activists campaign in 11 states ..."

You can contribute at saveworkers.org, and you can buy Steve's single on iTunes here. The two actions aren't mutually exclusive, either, so you don't have to make a vexing decision here. Why not do both?

Jobless Organize to Remove Republican Royalists From Their Jobs

Leo Gerard — Wed, 25 Aug 2010 13:34:40 -0400

Glenn Beck made it official on Fox News last week: He’s seeking the office of 21^st Century Marie Antoinette.

The queen of France, beheaded during the revolution, attained infamy for insensitivity toward hungry peasants. Glenn Beck, the Fox talk show host, achieved celebrity for his callousness toward unemployed Americans.

Beck leads a pack of royalist Republicans who have spent the summer mocking, vilifying and denigrating the nation’s 14.5 million unemployed workers. It is the moneyed class smacking down the working class in an attempt to disempower and disenfranchise them. Dispirited workers are less likely to vote – which could give Beck and his gang of royalist Republicans control of Congress.

The unemployed, like France’s 18^th Century peasants, are fighting back, however. The Union of the Unemployed and Working America are organizing the jobless to vote this fall and to demand help from lawmakers. They’re not out to behead Beck and the royalist Republicans, just dethrone them.

Two and a half years after wanton recklessness by Wall Street banksters crashed the economy, the official unemployment rate remains stuck at 9.5 percent. It rises to 17 percent when statisticians add part-time workers seeking full-time jobs and the jobless who’ve abandoned the search out of hopelessness. With the help of a taxpayer bailout, Wall Street has recovered, and those banksters are taking home multi-million dollar bonuses again. But on Main Street, there still are five unemployed workers for every job vacancy, so no matter how hard the jobless try, there are no openings for 80 percent of them.

Routinely, crowds line up before dawn when job openings are announced. In June, in Longmont, Colo., hundreds queued up to vie for 100 low-paid clerk and stock jobs at a new SmartCo Foods. Hundreds of Louisville residents gathered in the dark on Aug. 9 at the Kentucky Exposition Center to apply for 450 state fair jobs paying $7.25 an hour and lasting a total of 20 days.

In addition to jobs, the people on Main Street are losing their homes and life savings at increasing rates. Bankruptcy filings nationwide reached the highest level in five years between April and June. Banks repossessed 92,858 homes in July, up 6 percent from July 2009. For too many, the situation is so desperate that they’re discussing plans for suicide on an on-line forum for the jobless.

Glenn Beck and the royalist Republicans don’t care about all that. Here’s Beck ranting about those who lose unemployment benefits at 99 weeks:

"Have you heard of the 99ers? These people, some of which I, frankly, I bet you would be ashamed to call them Americans, they think 99 weeks of unemployment benefists are not enough. . .Two years is plenty of time to have lived off your neighbors' wallets."


Video of Beck slamming the "99ers" begins at 2 minutes and 33 seconds into this clip.

Beck went on to argue that the jobless who protested last week on Wall Street were not "regular people," like him and his friends:

“Are they just regular people? . . They are socialists and anti-capitalists.”

Then, incongruously, Beck condemned a protestor seeking jobs for all unemployed workers with a sign asserting, “A job is a right.”

“No, a job is not a right,” insisted Beck, making it clear that in his world, the unemployed are “un-American” for not landing jobs, but, simultaneously, it’s perfectly moral and fair that the American economy has failed to produce enough jobs for them to fill.

Beck is the TV mouthpiece for the royalist Republicans who champion this view: a job is not a right, and it’s not right to aid the jobless. Republicans, virtually as a block, oppose extending unemployment benefits for the jobless while they support extending tax breaks for the moneyed class – themselves. They opposed legislation to save the jobs of 319,000 public servants – the people who educate our children and protect our lives -- teachers, police officers, firefighters. Democrats in Congress paid to preserve those jobs by eliminating $11 billion in tax loopholes for corporations that ship jobs overseas -- a provision that ultimately could create jobs in the United States.

Like Beck, they’ve announced their loathing for the unemployed. Royalists Sharron Angle, Jon Kyl, Andre Bauer, Tom Corbett and Orrin Hatch have derided the unemployed as lazy, spoiled, stupid drug users.

The jobless, however, are mad as hell and aren’t going to take it anymore. They’re organizing. The Union of the Unemployed and Working America, the community affiliate of the AFL-CIO, are mobilizing the jobless.

The Union of the Unemployed is launching a “Bite Back” campaign, targeting those in Congress who tried repeatedly to cut off unemployment insurance and other aid to the jobless. “They will never see us coming,” the first Bite Back ad says, “After all, the politicians whose policies destroyed our lives think we’re ‘lazy’ ‘drug users’ and ‘hobos.’ They are counting on us to be docile as lambs and so depressed we’ll stay in bed on election day.”

Working America, whose members are not in unions but align themselves with the political philosophy of the AFL-CIO, plans to organize hundreds of thousands of the jobless across the nation to vote in workers’ interests. Field organizers will ask the jobless to fill out “Help Wanted” petitions to send to their congressmen and senators asking exactly what they’ve done to create jobs and assist the unemployed.

The jobless removing the royalists from their jobs – nothing could be sweeter, unless this revolution also included dispatching Glenn Beck to his unemployment office.

Call Congress On China Currency

Dave Johnson — Mon, 12 Jul 2010 11:23:20 -0400

Call Congress and demand action on Chinese currency. Visit www.metalworkingadvocate.org/action. Call 202-224-3121. China has up to a 40% pricing advantage resulting from currency manipulation and a lot of good jobs are riding on doing something about this.

At the AFL-CIO Blog: Call-In Day, July 13: Tell Congress to Pass Currency Legislation.

On July 13, tens of thousands of manufacturers across the country—members of the Fair Currency Coalition and the Coalition for a Prosperous America—will join with union members and citizen trade groups in a National Currency Call-In Day to ratchet up the pressure on the Obama administration and Congress to hold currency manipulators accountable.

But wait, there's more:

Call your senators and representatives at 202-224-3121 and tell them to support legislation to reign in currency manipulators or visit www.metalworkingadvocate.org/action to act now.

Here are the details:

Now that the Treasury Department once again has refused to label China as a currency manipulator, it is more important than ever for Congress to pass strong legislation quickly to stop the unfair and illegal advantage against U.S. producers that China and other nations gain by undervaluing their currency.

On July 13, tens of thousands of manufacturers across the country—members of the Fair Currency Coalition and the Coalition for a Prosperous America—will join with union members and citizen trade groups in a National Currency Call-In Day to ratchet up the pressure on the Obama administration and Congress to hold currency manipulators accountable.

A bipartisan group of senators is considering attaching S. 3134, the Currency Exchange Rate Oversight Reform Act of 2010, to legislation that may pass at anytime. Introduced by Sen. Charles Schumer (D-N.Y.), the legislation would give our government the tools it needs to address currency manipulation.

Tomorrow, call your senators and representatives at 202-224-3121 and tell them to support legislation to reign in currency manipulators or visit www.metalworkingadvocate.org/action to act now.

China and other countries routinely undervalue their currency to create a trading advantage. Their actions have robbed U.S. workers of jobs and undermined the nation’s manufacturing productive capacity and innovation. AFL-CIO President Richard Trumka, who co-chairs the Fair Currency Coalition, has said it is time to enforce our trade laws and look out for the interest of American workers and their communities

Last month before the G-20 summit, China announced it would allow its currency’s value to increase, a move former Labor Secretary Robert Reich called hokum. The University of California, Berkeley, professor further warned that China

isn’t really changing anything. It’s only doing the minimum to prevent Congress from listing China as a currency manipulator, leading to a squeeze on Chinese imports.

Call your member of Congress on July 13 and stop currency manipulation.

Q&A with Veteran Labor Organizer Stewart J. Acuff

Leo Gerard — Tue, 06 Jul 2010 15:15:39 -0400

Leo W. Gerard: Stewart, you talk about power in a book you’ve written with economist Dr. Richard A. Levins. You called the manual, “Getting America Back to Work.” What’s the relationship between power and getting people back to work?

Stewart J. Acuff: A big part of the problem we have with this economy or the biggest problem is that most of the money has gone to the Financial Elite -- and the power as well. To get America back to work we have to reinvest in our country and our workers. That necessarily means that the Financial Elite get less of the wealth generated by the economy and workers will get more. If you intend to take wealth from the richest people in the history of the world, you have to have enough power to do so.

Gerard: You say in the introduction that there are two kinds of power: “The first is lots of organized money. That is the kind of power the Financial Elite have used to bring the rest of us to our knees. The other source and form of power is lots of people: organized, mobilized, united, and taking action.” Do you really think that organized people can succeed in a wrangle with the financial elites?

Acuff: Absolutely! The economic history of the twentieth century is crystal clear. When unions were strong, working people had the lion's share of income and the economy worked well. When unions were weakened, we have seen the Financial Elite take over and run the economy into the ground.

That’s why passing the Employees Free Choice Act is more important than ever. When we strengthen unions, we strengthen the economy.

Gerard: Now, Stewart, you sound like some kind of Socialist talking about the fact that at times in the nation’s history the financial elite received collectively as little as 9 percent of the total income earned by Americans but at other times – like right now and right before the Great Depression – the financial elite grabbed more than 23 percent of all income. I mean, aren’t you afraid the likes of Rush Limbaugh and Glenn Beck will accuse you of opposing just rewards earned by the barons of capitalism?

Acuff: Well, my friend, those aren’t just rewards. As my friend Jim Hightower said, members of the Financial Elite were born on third base and say they hit a triple. It’s beyond comprehension that the trading of phony financial instruments like derivatives produces rewards. What produces just rewards is manufacturing and producing goods and services that people need and want. The person who needs just rewards today is the hotel maid who cleans rooms for a living or the overstressed nurse who can’t get to all her patients or the skilled but out-of-work construction worker waiting for the chance to earn an honest day’s pay.

Gerard: Okay, but then you start talking about income tax rates. Are you really suggesting that the current maximum of 35 percent be raised to the 90 percent that it was during the 1950s? Would that not just enrage the financial elite?

Acuff: Yes, it would enrage the Financial Elite and Dr. Levins and I haven’t made that case in this book. Certainly the income tax rate for the richest among us is far too low. When Warren Buffet himself says he pays a lower percentage of his income in taxes than does his secretary, that’s a problem.

We wouldn't need to rely on taxes to redistribute income if we had the right mix of union power and corporate power. Instead of a few massive fortunes, we would have millions of working people being productive and using fair wages to stimulate economic growth.

Gerard: Since the days of Reagan, Republicans have told us that taxes on the financial elite should be cut because they need all that money to “re-invest” in the system. That way, the GOP line goes, wealth will trickle down on the “little people.” This hasn’t really worked, has it?

Acuff: No! Not at all! Since the days of Reagan workers wages have stagnated and declined while our productivity has increased. Wealth does not trickle down. Have you seen any of the TARP billions trickling into your pocket lately? I sure haven't. All I saw was obscene bonus payments to those who caused the mess in the first place.

Gerard: Halfway through the book, you suggest working people can have it all – family-supporting jobs, health insurance, even Social Security. Those on the radical right tell us daily that’s impossible because of the national debt. How can you justify such a vision?

Acuff: More income means more tax revenue, more economic growth and economic activity. We lift the economy from the bottom, not from the top.

Gerard: Then you have the audacity to quote some old economists claiming, “An efficient and humane society requires both halves of the mixed system – market and government.” We know, because the right-wing has told us repeatedly, that government is bad, that it should be shrunk and drowned in a bathtub. Where did you and Professor Levins come up with this new-fangled idea that government could help?

Acuff: It’s not a new idea. It says right in the ECON 101 text that Dr. Levins used in his classes that "markets without government is just one hand clapping." From the destruction of 2 trillion dollars of America’s wealth by Wall Street to the incessant pouring of oil from BP’s hole in the bottom of the Gulf, we know that capitalism must be regulated and constrained for the sake of everyone.

Gerard: Which brings us to organized labor. You quote President Kennedy saying, “Those who would destroy or further limit the rights of organized labor – those who would cripple collective bargaining or prevent organization – do a disservice to the cause of democracy.” Isn’t that exactly what has happened since the days of Kennedy, a slow destruction of the labor movement with corporations, union-busters and sometimes government regulators all working together to rob labor unions of the power they built between the 1930s and 1950s?

Acuff: Yes, you’re absolutely right. The results are the mal-distribution of wealth and power and massive recession, a shrinking middle class, a starved consumer demand, and a weaker America.

Gerard: The book was written and published before the explosion on the Deepwater Horizon rig that was drilling for BP in the Gulf of Mexico. Is it somewhat prophetic, then, that you discuss the need to move from a fossil fuel-based economy to one that creates jobs with renewable energy sources?

Acuff: I can’t speak to prophecy though I am a huge fan or both Isaiah and Jeremiah. We’ve long known that America needs to generate its own free energy from free resources like the wind that never stops blowing on Great Plains, the sun that never stops shining in the deserts of Arizona, and incessant pull of the ocean’s tide.

Gerard: I was glad to see the chapter discussing the importance of maintaining and supporting manufacturing in America. For those still unconvinced, why is that so important?

Acuff: Well, we don’t need to maintain just current manufacturing capacity. We need to increase manufacturing capacity. That is how to generate wealth. We create wealth by making things that other people want to buy and that is the best way to build a sound economy.

Gerard: You sound a little bit like a preacher at the end where you state the four values that Americans can believe in. Do you think America can organize around those values and take on the financial elite?

Acuff: Yes, I do! I think what we need is a reinforcement of fundamental human values. We’re all in this together; there is a common good; we are our sisters’ and brothers’ keepers, and workers win and have always won by exercising collective power against the individual power of the Financial Elite.

***

Stewart Acuff is chief of staff for the Utility Workers Union of America. He has organized for 30 years, beginning in 1982 with the SEIU. In 1990, he became president of the Atlanta AFL-CIO. There he led the campaign to organize the 1996 Olympics. A decade later, he went to work for the national AFL-CIO, serving as organizing director from 2001 to 2008. He led the AFL-CIO campaign to pass the Employee Free Choice Act.

***

Dr. Richard Levins is professor emeritus of applied economics at the University of Minnesota. He is an award-winning author of books about policy and market power.

Danger: Falling Middle Class

Tula Connell — Fri, 05 Feb 2010 09:06:52 -0500

Jack Cafferty at CNN this week asked viewers one of his seemingly routine questions. But the responses to: "How has definition of 'middle-class American' changed?" reveal a cataclysmic shift in our nation's economic identity.

Gary from El Centro, Calif., summed up the vast majority of the nearly 200 responses when he replied:

You should ask this question of the three or four people in the country still remaining in the middle class.

The comments reflect more than the run-of-the-mill griping about taxes or middle-aged discontent. They demonstrate a visceral understanding of the deep forces underlying the dramatic change that in recent decades has eroded the solid financial footing of America's working families—America's middle class.

In short, the American public knows what most lawmakers in Washington and policymakers around the country have yet to figure out: The nation is losing its middle-class backbone and bifurcating into a have/have not country.

As Karen from Idaho Falls writes on Cafferty's site:

In my world, there is no middle class–only the very rich, the rich, the poor, and the very poor. Most of us are hanging on to being "poor" by our fingernails and hoping that we won't join the ever growing "very poor" class. Somewhere along the line, "middle class" disappeared.

The not-so-Great Recession is just the latest and loudest part of the long decline of the middle class. From the end of World War II to the early 1970s, wages grew along with productivity. But since then, wages have been stagnant or declining—while productivity skyrocketed. The decline in a family's earning power was offset by the entrance of vast numbers of women in the labor market—and then by wage-earners holding multiple jobs. By the late 1990s, debt—from second mortgages or credit cards—kept the middle class afloat. And now what is revealed is a middle class held together by nothing more than string.

One of the most consequential but least recognized aspects of the current economic disaster is the growing length of time workers are without jobs. In December, the average jobless worker had been unemployed for 29.1 weeks. In contrast, when the recession began in 2007, the average unemployed person had been out of work for 16.5 weeks.

At Economix blog, Catherine Rampell points out in an tellingly titled post, "A Growing Underclass," that the longer unemployed workers stay out of work, the less likely they may be to find work.

First, their skills may deteriorate or become obsolete—especially if they are in a dynamically changing industry like high technology.

Second, the stigma—both internal and external—of their unemployment grows. Studies have linked job loss to declines in self-worth and self-esteem, meaning these people will probably make less compelling job candidates.

So, even if there were jobs available—there are now more than six unemployed workers for every one job—getting one becomes harder and harder the longer you're out of work. Jobs are so few, in fact, even a weekly columnist at Forbes had this to say:

For many, many Americans there are no jobs and few prospects. For them the Great Recession is not a cute aphorism but a major cataclysm.

Long-term joblessness is one more nail in the middle class coffin. As Working-Class Perspectives describes it:

Unlike in past business cycles, the middle class has not been able to recover so far, despite increases in productivity and stock prices. In “America Without a Middle Class,” Elizabeth Warren documents how the de facto unemployment rate, credit debt, “underwater” mortgages, increased use of food stamps, personal bankruptcies, and the loss of pensions and health care have all dramatically increased. Middle-class households have depleted their savings and are increasingly accruing debt to pay for college, health care, and other expenses.

Some experts believe that the decline in jobs will only continue. For example, Alexandra Levit predicts significant losses in a number of key industries between 2008 and 2018: semiconductor manufacturing (33.7 percent), apparel manufacturing (57 percent), newspaper publishers (24.8 percent)….Corporations are moving many of these jobs offshore or replacing them with technology rather than paying middle-class wages and benefits. The economists are right that new jobs are being created in place of these. But as Jack Metzgar discussed last week, most of the new jobs offer even lower wages and benefits and require less education.

Jobs are offshored while the jobs that remain in the United States are low-wage, with little affordable health care or retirement options. Meanwhile, the smooth of face and soft of hand financial wizards who turn their noses up at the industrial manufacturing sector fail to realize that when the United States loses its ability to make things, it also loses the research and development power that fueled the nation to greatness. And it loses something a lot more. Louis Uchitelle interviews Sen. Sherrod Brown (D-Ohio) about the humiliation of building a new World Trade Center with no glass made in the United States:

“Imagine China,” he said in an interview, “building a huge structure intended to be an important national symbol and importing glass from the United States to build it. There is no way the Chinese would do that.”

And a low-wage job nation fuels income inequality. This from a stunning report by economist John Schmit at the Center for Economic and Policy Research:

From a peak just before the 1929 stock market crash through the early 1950s, wage and income inequality, broadly measured, were declining. From the early 1950s through the late 1970s, inequality was flat, or even falling slightly. Since the late 1970s, however, inequality has skyrocketed, climbing back to levels last seen in the 1920s. In 1979, for example, the top one percent of all U.S. taxpayers received about 8 percent of national income; by 2007, the top one percent received over 18 percent. If we include income from capital gains in the calculation, the increase in inequality is even sharper, with the top one percent capturing 10 percent of all income in 1979, but over 23 percent in 2007.

Back at Cafferty's site, Chad from Los Angeles knows why:

The middle class has turned into the "peasant class." We have been taken over by a few wealthy people who control our politicians and government. We have become an Aristocracy. Except the ones in control are not royalty, they are businessmen hiding behind a cloak of deception that is Corporate America.

In the short term, critical steps must be taken for immediate relief. The first is getting the Senate to extend unemployment insurance (UI) for the long-term unemployed. As usual, the House already has acted, extending UI in December, while senators dither. (Click here to tell your lawmakers it’s time to act.) Extending UI is part of the jobs initiative the AFL-CIO is pushing for immediate relief for jobless workers.

But before the current crisis fades, the nation must begin to reverse the more than 40-year trend in which the gap widens between rich and poor and the middle class falls out of the bottom.

Silas from Boston—a city not unfamiliar with fomenting revolutions—offers an intriguing insight:

We've allowed the "upper" class to become too big to fail. As a result, the middle class is an endangered species which has to bail out the class that got us into this mess to begin with. This is how the French Revolution started.

This is a cross-post from the Firedoglake blog.

Outrage

Richard Trumka — Wed, 27 Jan 2010 14:29:01 -0500

The news is out: The Wall Street bankers we bailed out are giving themselves 2009 cash bonuses of a half million dollars on average -- not including stocks. Compare that with the $32,390 annual median wage for regular workers, and you find a formula for outrage.

The people who tanked our economy, took $700 billion in taxpayer money and refused to make job-creating loans are getting rewards that range into the millions.

Not bad for a year in which Main Street lost 4 million jobs.

No wonder people are mad.

When Wall Street needs help, elected leaders respond with bold and swift action. When Main Street cries for help, we get gridlock. No health care reform, no financial reform, no labor law reform, and a slow, timid effort on job creation.

The anger out there is well-deserved. Workers are hurting. We haven't seen so much militant sentiment demanding job creation and basic fairness since hundreds of thousands of people came to Washington for the March for Jobs and Freedom in 1963.

The Massachusetts Senate election last week signaled a working class revolt -- against business as usual and against politics as usual.

An AFL-CIO poll taken election night showed just how fed up people are -- they want results, and aren't seeing any.

Four out of five voters said their most important issue was strengthening the economy and creating more jobs. Controlling health care costs was next on their list, with 54 percent citing that as the main determinant of their vote.

And they said Democrats have not overreached on jobs, the economy and health care -- they have under-reached.

Forty-seven percent said their concern about Democrats is that they haven't succeeded in making needed change, while only 32 percent said they made too many changes too quickly. Even voters for Scott Brown were more concerned about a lack of change (50 percent) than about making too many changes too quickly (43 percent).

Contrary to what we're hearing from the corporate media, the Massachusetts election wasn't a referendum on health care reform (Brown actually lost among the 59 percent of voters who picked health care as one of their top two priorities). But it did send a clear message that voters rejected attacks on the middle class like the proposed excise tax on health care benefits. Voters who thought their health care would be taxed voted by 64 percent for Brown, while those who did not think so voted by 54 percent to 40 percent for Coakley.

The election was no endorsement of the Republican agenda either -- in fact, 58 percent of voters disapprove of the job being done by congressional Republicans.

Here's what one grassroots union leader learned from his experience in the Massachusetts race:

A year ago, the Democrats crowed that the Republicans were "irrelevant." Today, the Republicans think the Democrats are mortally wounded. Both are wrong. In our non-ideological party landscape, in hard times whoever strikes the best pose of wounded underdog wins. The same anger that elected Obama was hijacked to elect Scott Brown: "We want change!"

There was no outpouring for a right-wing agenda in Massachusetts. Brown only received 50,000 votes more than McCain. But Coakley received 850,000 fewer votes than Obama. The Republican base remained energized. The Democratic base and independent supporters stayed home.

Unless elected leaders and candidates deliver on job creation and the economy -- they're going to join the growing numbers of jobless Americans.

Members of Congress from both parties need to heed the wake-up call from Massachusetts and start taxing Wall Street wealth to create millions of good jobs fast. To get elected in 2010, they're going to have to PROVE they'll create the jobs we need in an economy we need with the health care we need -- and those who made the mess should pay the bill. Voters have heard too much talk already.

America's union movement is leading a broad uprising of working people ready to make sure elected leaders and candidates get the message and don't forget. Don't just watch for us in the streets -- join us.

The Working Class Has Spoken. Will Democrats Listen?

Tula Connell — Thu, 21 Jan 2010 16:30:29 -0500

Massachusetts voters sent a strong signal to Washington lawmakers Tuesday that they want results—and aren't seeing any. Not on health care reform, not on job creation and not on fixing the nation's economy.

Voters also sent another powerful message for Democrats: Ignore the working class at your peril.

Some 79 percent of voters polled on election night said the most important issue for them was electing a candidate who will strengthen the economy and create more jobs. Controlling health care costs was next on their list, with 54 percent citing that issue as the main determinant of their vote.

The poll, conducted by Hart Research Associates among 810 voters for the AFL-CIO on the night of the election, also found that although voters without a college degree favored Barack Obama by 21 percentage points in the 2008 election, Democratic candidate Martha Coakley lost that same group by a 20-point margin.

And as AFL-CIO Richard Trumka has pointed out, Massachusetts voters have the same goals for reforming health care, creating good jobs and strengthening the economy as they did in November 2008—but President Obama and the Democrats have done too little.

Voters showed they don’t think Democrats have overreached—they think that the Democrats underreached.

In fact, voters were not worried about Democratic “overreach”—47 percent said their bigger concern about Democrats is that they haven't succeeded in making needed change rather than tried to make too many changes too quickly (32 percent). Even voters for Scott Brown were more concerned about a lack of change (50 percent) than about trying to make too many changes too quickly (43 percent).

These results puts a lie to the corporate media spin that Democrats have gone "too far" in pushing a reform agenda.

Nor was the election result about health care reform. Brown actually lost among the 59 percent of voters who picked health care as one of their top two voting issues (50 percent for Coakley and 46 percent for Brown). Voters for Brown (55 percent ) were less likely to cite health care as a top issue than were voters for Coakley (66 percent).

The election also should be a wake-up call for those in Washington who support taxing working families' health care. Voters who thought their health care would be taxed voted by 64 percent for Brown, while those who did not think their health care would be taxed voted by 54 percent to 40 percent for Coakley.

Our polling results show the election was not an endorsement of a Republican agenda or a call to abandon health care reform. Voters strongly disapprove of the job being done by congressional Republicans (26 percent approve and 58 percent disapprove), a much lower rating than they give to congressional Democrats (37 percent approve and 51 percent disapprove).

Other polls show the need for Democrats in Congress to take immediate action to create jobs, reform health care, stop catering to Wall Street and address the needs of America's working class. As John Judis wrote, the election showed Democrats have lost ground primarily among white working and middle-class voters and senior citizens.

The Suffolk University poll in Massachusetts…singled out two white working-class towns, Gardner and Fitchburg, as bellwethers. Obama won Gardner, where Democrats hold a 3-1 registrations edge, by 59 percent to 31 percent in 2008. Brown won it by 56 percent to 42 percent. Obama won Fitchburg, with a similar Democratic edge, by 60 percent to 38 percent in 2008. Brown won it by 59 percent to 40 percent. That suggests a fairly dramatic shift among white working-class voters.

Summarizing the findings from election night polling conducted by Research 2000 Massachusetts Poll, MoveOn.org said the results show voters worry that Democrats in power "have not done enough to combat the policies of the Bush era."

Both sets of voters wanted stronger, more progressive action on health care reform as well. In summary, the poll shows that the party who fights corporate interests—especially on making the economy work for most Americans—will win the confidence of the voters.

The working class has spoken. Will Democrats listen?

Special - Today Only! Call To Stop the Health Tax

Richard Eskow — Wed, 13 Jan 2010 12:30:27 -0500

The AFL-CIO has announced that it is coordinating a "National Call-In Blitz" today.. If you call this toll free number - 1-877-3-AFLCIO (1-877-323-5246) - you can "urge your representative to support working families by voting for health care reform that: Does NOT tax our health care benefits; Requires employers to pay their fair share; and Reduces health care costs—the best way to do this is with a public health insurance option."

This is a wise course of action whether you belong to a union or not. The tax is both unfair and badly designed, which means it should be scrapped. And it's likely to affect far more non-union families that union families. It's not just a labor issue - it's a national issue.

Like they say on those radio ads:

Call 1-877-3-AFLCIO.

Again, that's 1-877-3-AFLCIO.

Do it today! This offer may not be repeated.