Omar Ocampo: Extreme wealth inequality means extreme political inequality

—Photo by ThirstyFish.com

Progressive era cartoon

Via OtherWords.org

BOSTON

A new, disturbing milestone has been confirmed in the latest Forbes World Billionaires List. The U.S. billionaire class is now larger and richer than ever, with 813 ten-figure oligarchs together holding $5.7 trillion.

This is a $1.2 trillion increase from the year before — and a gargantuan $2.7 trillion increase since March 2020.

The staggering upsurge shows how our economy primarily benefits the wealthy, rather than the ordinary working people who produce their wealth. Even worse, those extremely wealthy individuals often use these assets to undermine our democracy.

Billionaires have enormous power to influence the political process. They spent $1.2 billion in the 2020 general election and more than $880 million in the 2022 midterms. Even when their preferred candidates aren’t in office, our institutions are still more likely to respond to their policy preferences than the average voter’s, especially when it comes to taxes.

The vast majority of Americans, including 63 percent of Republicans, support higher taxes on the wealthy. Yet our representatives consistently fail to deliver. A quintessential example was Donald Trump’s 2017 tax cuts for corporations and the rich — the most unpopular legislation signed into law in the past 25 years.

Though backers promised the tax cuts would benefit all Americans, a recent report by the Center on Budget and Policy Priorities revealed that the primary beneficiaries were the top 1 percent.

The good news? Those cuts are set to expire after next year. So we’ll have an opportunity for a new tax reform — one that raises more money for the services we rely on while protecting our democracy from extreme wealth concentration.

President Joe Biden’s Billionaire Minimum Income Tax (BMIT) is one promising proposal. By raising the top tax rate and taxing unrealized capital gains, the BMIT seeks to repair a system where billionaires pay a lower average tax rate than working people. It would raise $50 billion a year over the next decade, making our tax system a bit more equitable.

Senator Ron Wyden’s (D.-Ore.) similarly named Billionaire Income Tax (BIT) is more straightforward. It would target asset gains that can easily be tracked by the public, like a billionaire’s stock holdings in a publicly traded company.

Another idea? A well-designed progressive tax on billionaire wealth.

A modest 5 percent tax on all wealth above $1 billion would raise more than $244 billion this year alone. And that’s likely an underestimate, since some billionaires keep their wealth concealed from Forbes. Wealth-X, a private research firm, identified 955 billionaires in their  Census last year, 142 more than what Forbes just registered.

A wealth tax wouldn’t hurt investment and innovation — most innovation in the U.S. is driven by people worth less than $50 million. But for billionaires, it would function “as a constraint on their rate of wealth accumulation,” according to Patriotic Millionaires, a group of wealthy people who support higher taxes on the rich.

Of course, a wealth tax alone isn’t enough to ensure the safety of our democracy. We also need campaign finance reform to limit political spending. And stronger labor unions could prevent extreme concentrations of wealth from occurring in the first place. Unions not only increase the collective power of workers, they also close wage gaps between workers and CEOs.

Finally, we need better tax enforcement. The Inflation Reduction Act gave the IRS more resources to track down wealthy tax dodgers, and now the agency is projecting an unexpected windfall in tax revenue over the next decade.

That’s a great first step towards strengthening our democracy and democratizing our economy. Now let’s take the next step and fix the tax code itself.

Boston-based Omar Ocampo is a researcher for the Program on Inequality and the Common Good at the Institute for Policy Studies.

Omar’s headshot

Jim Hightower: So wall off the Canadian border, too!?

A plaque attached to a bridge on the Maine /New Brunswick border crossing.

— Photo by Marty Aligata

The Haskell Free Library and Opera House straddles the border in Derby Line, Vt., and Stanstead, Quebec. The line on the floor shows the boundary line.

Looking at Campobello Island, in New Brunswick, Canada. Its only land access to the mainland is to Maine.

Park in Pittsburg, N.H., which is on the Canadian border. See New York Times story linked below.

— Photo by Jon Platek

Text from OtherWords.org

In the 1980s, many Texans were alarmed that hordes of immigrants were fleeing Rust Belt states and pouring across the Red River to take our jobs. So my friend and fellow Texan Steve Fromholz recommended a big beautiful wall across our northern border to keep them out.

Fromholz, a popular singer-songwriter and renowned political sprite, was ahead of his time in the political sport of wall building.

Instead of steel barriers and miles of nasty razor wire, Steve proposed preventing Yankee refugees from entering the Lone Star State by planting a 10-foot high, 10-foot thick wall of jalapeño peppers along the length of the Red River. Eat your way through and you’d be accepted as a naturalized Texan.

I thought of Steve’s impishness when I read that Nikki Haley, Ron DeSantis, and other Republicans were concocting a whole new xenophobic bugaboo to goose up their anti-immigrant demagoguery.

We can’t just fear the “invasion” coming across our Southern border, they cry! Indeed, Haley wailed: “It’s the northern border, too.” She added ominously that we must “do whatever it takes to keep people out.” DeSantis piled on, saying we should wall off America’s Canadian border.

Meanwhile, nearly all residents living along that 5,500-mile boundary fear the political wall-mongers more than the imaginary threat of foreigners surging across illegally. “People have always been coming through Canada,” says a clerk at a general store in far-north New Hampshire. Scoffing at the silly political hype, she says: “I don’t think the residents are really worried.”

But Chicken Little politicos won’t be shooed off by reality. After all, they still have the east, west and Gulf coasts to shut off — so expect them to propose razor wire for the entire U.S. shoreline. Their ridiculousness makes Fromholz’s satire seem rational!

OtherWords columnist Jim Hightower is a radio commentator, writer and public speaker.

Move along, nothing to see

Then start all over again

It’s just business

Sonali Kolhatkar: Starbucks CEO Schultz -- union buster in chief

Starbucks workers protesting in Seattle, where the company is based.

—Photo by elliotstoller

Starbucks was named after Starbuck, the thoughtful Nantucket Quaker who was the first mate on the whaling ship Pequod in Herman Melville’s Moby Dick.

From OtherWords.org

Outgoing Starbucks CEO Howard Schultz, in a recent interview with CNN, proudly showed off his newest invention: a tablespoon of olive oil added to a cup of coffee to bring out rich, complex flavors.

The conversation was meant to showcase Schultz’s commitment to Starbucks coffee as he prepared to step down as CEO of the company for the third time. But it took place in Italy, prompting his interviewer to ask: Why wasn’t Schultz sitting down with unionizing workers back home?

Indeed, Schultz — who is worth some $3.7 billion — has been operating as union-buster-in-chief of the iconic corporation.

Since the first group of Starbucks workers unionized a café in Buffalo in late 2021, more than 278 stores have done the same, according to Starbucks Workers United. Still, the number of unionized cafés remains a tiny fraction — about 3 percent — of all stores.

Early on, Schultz admitted to workers that the company had failed to give them the tools they needed, such as better staffing and training. But Schultz’s response was to create an uneven playing field and punish workers for daring to demand better conditions.

In 2022, Schultz reportedly rewarded nonunion workers with better wages and benefits, as well as credit card tipping, and denied the same to people working in union stores. As a result, the New York Times reported, “Filings for union elections dropped from more than 60 a month in March and April to under 10 in August.”

Meanwhile, the company is firing union leaders such as Starbucks worker Hannah Whitbeck in Ann Arbor, Michigan. Her termination prompted a lawsuit and a federal judge’s decision that prohibited the Ann Arbor store from firing workers for union activity.

The company has also been understaffing stores that are unionizing, a move that the union says is a deliberate ploy to make workers’ lives more difficult. Schultz has even closed entire stores that have dared to take up union activity, including the first store in Seattle to unionize.

“This is just the beginning. There are going to be many more,” warned Schultz in July 2022.

As long as an employer can abuse workers, there is a need for unions. And union activity is surging, with a 50 percent increase in strike activity last year compared to the year before, according to the Bureau of Labor Statistics.

Shultz apparently sees himself as above the law. He refused to testify about his company’s 75 documented violations of federal labor laws in front of the Senate Health, Education, Labor, and Pensions Committee, chaired by Senator Bernie Sanders, until Sanders forced him to with a subpoena.

But not every company is fighting its own workers tooth and nail. When Toyota workers in Japan asked for the largest pay hike in 20 years, the automaker agreed to all the union’s demands in the very first round of negotiations.

Toyota’s head Koji Sato said the move was intended as an example “for the industry as a whole.” It worked. Hours after Toyota’s announcement, Honda accepted its own union’s demands in full.

No so for Starbucks. Schultz has ruined the company’s reputation for caring about its workers and become the poster child, even in the business world, of what not to do when faced with union activity.

Starbucks should take a page out of Toyota’s book. In his CNN interview, even Schultz admitted that what Starbucks workers want more than anything is “a seat at the table.” He added, “It’s hard to walk in someone else’s shoes, but you’ve got to do that a little bit.”

Instead of experimenting with olive oil in coffee, he could try something else that’s new for him — treating workers with the same respect that he commands.

Sonali Kolhatkar is the host of Rising Up With Sonali, a television and radio show on Free Speech TV and Pacifica stations.

Jim Hightower: Would they kill your granny to make a buck?

From OtherWords.org

There are industries that occasionally do something rotten. And there are industries, such as Big Oil, Big Pharma and Big Tobacco, that persistently do rotten things.

Then there is the nursing-home industry — where rottenness has become a core business principle. 

The end-of-life experience can be rotten enough on its own, with an assortment of natural indignities bedeviling us. Good nursing homes help patients gently through this time. In the past couple of decades, though, an entirely unnatural force has come to dominate the delivery of aged care: profiteering corporate chains and Wall Street speculators.

The very fact that this essential and sensitive social function, which ought to be the domain of health professionals and charitable enterprises, is now called an “industry” reflects a total perversion of its purpose. 

Some 70 percent of nursing homes are now corporate operations, often  run by absentee executives who have no experience in nursing homes and who are guided by the market imperative of maximizing investor profits. They constantly demand “efficiencies” from their facilities — which invariably means reducing the number of nurses, which invariably reduces care, which means more injuries, illness and deaths. 

As one nursing expert quoted by The New Yorker rightly says, “It’s criminal.”

But it’s not against the law, since the industry’s lobbying front — a major donor to congressional campaigns — effectively writes the laws, which lets corporate hustlers provide only one nurse on duty, no matter how many patients are in the facility. 

When a humane nurse-staffing requirement was proposed last year, the lobby group furiously opposed it, and Congress dutifully bowed to industry profits over grandma’s decent end-time. After all, granny probably doesn’t make campaign donations.

So, as a health-policy analyst bluntly puts it, “The only kind of groups that seem to be interested in investing in nursing homes are bad actors.” To help push for better, contact TheConsumerVoice.org.

OtherWords columnist Jim Hightower is a radio commentator, writer and public speaker.

Bella DeVaan: Swift superfans may have struck blow against monopoly

Taylor Swift’s fans paid for the singer’s mansion — the white Colonial Revival structure at the top of the hill —- in the Watch Hill section of Westerly, R.I. The house, called High Watch, was formerly named Holiday House and also called the Harkness House (after a family enriched by Standard Oil who lived there for a time) by locals, is an 11,000-square-foot edifice on five acres that she bought for $17.75 million in 2013. The house was built in 1929-1930.

— Photo by JJBers - https://www.flickr.com/photos/jjbers/33980495256/

Via OtherWords.org

As the cost of food, travel, and gifts complicate holiday plans across the country, millions of Americans have been awakened to the sinister power of monopolies.

But now there are exciting new possibilities to rein them in.

This November, legions of new anti-monopolists were born. They’re Taylor Swift’s superfans — and they just might be the reason the government breaks up Ticketmaster.

Hoping to get pre-sale tickets to their favorite pop star’s upcoming tour, millions of “Swifties” waited in endless electronic queues, only to be hit with sky-high prices and exorbitant fees — if they were able to snag a ticket at all.

“Ticket prices may fluctuate, upon demand, at any time,” read an ominous warning on the Ticketmaster website.

And they did: Under Ticketmaster’s “dynamic pricing” system, fans reported ticket prices running up to thousands of dollars — not including hefty fees. Prices spiked even higher on the secondary resale market. On StubHub, ticket listings reached upwards of $95,000.

Finally, Ticketmaster threw in the towel and canceled subsequent presale windows. Their site crashed thousands of times. It was mayhem — and thanks to an unchecked monopoly, fans had no other option.

But the Swifties struck back. Hours after Taylor Swift released a statement apologizing to fans and chastising Ticketmaster, the Department of Justice (DOJ) announced an investigation of Live Nation Entertainment, which owns Ticketmaster.

While their investigation wasn’t prompted by Swift, reported the New York Times, Swifties’ wave of discontent was overwhelming enough to warrant the department’s public disclosure. Immediately after, the company that had been bragging about a record-smashing 2022 saw its stock plummet.

How did we get here? When it comes to antitrust issues, the U.S. government has essentially been asleep at the wheel, allowing Ticketmaster’s monopoly to crush its competition for over a decade.

In 2010, Ticketmaster and Live Nation merged into Live Nation Entertainment. The merger was subject to a relatively weak consent decree, which asked the merged companies not to abuse their live venue dominance. But it’s been easy for Live Nation Entertainment to intimidate their naysayers and flout guidelines.

“Ticketmaster bullies venues into not working with their competitors,” explains Chokepoint Capitalism author Cory Doctorow. “They bully smaller artists by denying them management. They bully big artists by controlling their ticket prices and letting their fans down. And they bully their customers into paying exorbitant prices for tickets.”

Well before the Swift fiasco, a coalition of research organizations and live event workers launched the Break Up Ticketmaster campaign asking the Department of Justice to “investigate and unwind” the live events monopoly. The campaign quickly gained ground, generating tens of thousands of signatures on an advocacy letter.

Policy makers are now echoing that call.

“Consumers deserve better than this anti-hero behavior,” tweeted Senator Richard Blumenthal (D-CT), punning off a song from Swift’s latest album, Midnights. 

And on MSNBC, Senate Antitrust Committee chair Amy Klobuchar (D.-Minn.) promised a Senate hearing. She’s also co-authored bills with Senators Chuck Grassley (R-Iowa) and Mike Lee (R-Utah) to facilitate antitrust enforcement with new filing, funding, and state empowerment rules.

The attorney general of Tennessee — home to the “angriest Swifties” — opened an investigation into Ticketmaster’s misconduct, too.

President Biden recently directed his administration to “reduce or eliminate” junk fees like Ticketmasters’ infamous extra charges, which sometimes total up to 78 percent of the cost of a ticket. He’s also appointed a passel of antitrust enforcers and signed a robust, competition-oriented executive order in his first months in the Oval Office.

Monopolies aren’t just fleecing concert-goers. All of us experience the villainy of monopolies — in the high price of a tight seat on a plane, in the destruction of local journalism, in skyrocketing monthly rent and food prices, or in the marginalization of small online businesses.

So, present day monopolists, steel yourselves and remember: When you provoke a superfan, they’ll come for you.Bella DeVaan

Bella DeVaan is a program associate at the Institute for Policy Studies and a co-editor of Inequality.org.

Sam Pizzigati: Maybe taxpayer-subsidized Musk isn’t quite as brilliant as you think

Elon Musk

— Photo by Debbie Rowe

BOSTON

From OtherWords.org

A good day’s work for a good day’s pay. Should this age-old wisdom apply to overpaid CEOs as well as their workers? A Delaware court will soon decide, a turn of events that must have the richest man in the known universe, Elon Musk, feeling more than a little bit uneasy.

Delaware’s little-known Court of Chancery normally provides business moguls a battleground where they can slug out their big-ticket differences. But the court also gives stockholders a chance to push back against the moguls — and one modest shareholder in the Musk empire has done just that.

Shareholder Richard Tornetta, a former heavy-metal drummer, filed suit in 2018 against the company’s board for lavishing unnecessary billions upon Musk.

Tornetta’s challenge has ended up before the Chancery Court’s Kathleen McCormick, a judge who’s already demonstrated a distinct lack of patience with Muskian antics. Just this past October, McCormick ruled against Musk in another case. She might well again.

Musk’s current Tesla CEO pay plan, notes CNN Business, gives Musk “the largest compensation package for anyone on Earth from a publicly traded company.” Under the plan, the higher Tesla’s share price goes, the more new Tesla shares Musk gets.

Thanks to that connection, Musk’s personal net worth now sits at $189 billion, the world’s largest personal fortune. In 2018, the year Musk’s Tesla pay deal went into effect, some 40 billionaires worldwide topped Musk on the Bloomberg billionaire charts.

Back in 2018, major shareholder advisory firms recommended that Tesla shareholders reject the pay deal that Tesla’s corporate board — a panel that included Musk’s brother and assorted close pals — wanted to give Musk.

Musk himself, one advisory firm noted, already had plenty of incentive to work hard for Tesla’s success. He owned 22 percent of Tesla’s shares even before his new CEO pay deal.

The week-long trial on Richard Tornetta’s Delaware lawsuit against Musk and Tesla ended in mid-November. Judge McCormick’s decision in the case will likely come down sometime over the next three months.

McCormick’s previous ruling against Musk came when the billionaire tried to back out of the deal he cut last spring to buy Twitter. After that ruling, Musk had to go ahead with the purchase. Now he’s flailing about, trying to make others pay the price for his impulsive takeover bid. He’s already laid off half the Twitter workforce.

If McCormick rules against Musk once again, Musk will still walk away fantastically rich. But he won’t walk away happy. His ongoing Twitter debacle — and now the Tesla litigation — have dealt his reputation for unparalleled business “genius” a potentially fatal blow.

Under cross-examination in the Tesla case, for instance, Musk had to concede that he didn’t come up with the original vision for Tesla himself, the claim he’s been making for years.

Musk turns out to be as flawed as the rest of us. The key difference: Musk has the power and wealth to make others pay for his mistakes.

Musk has also benefited, unlike the rest of us, from billions in taxpayer subsidies. Handouts to his electric car, solar panel and spaceflight businesses — all “long-shot start-ups,” the Los Angeles Times has detailed — gave his companies their secret sauce. Those subsidies launched Musk’s unparalleled personal fortune.

So what can the rest of us do to prevent another “brilliant” entrepreneur from building a fortune off the insights, labor and tax dollars of others? We can deny subsidies to companies that pay their top execs hundreds of times more than what they pay their workers. We can tax the rich at much higher rates.

And we can put Elon Musk atop a rocket and send him off to where he has repeatedly announced he dearly wants to go — to Mars.

Sam Pizzigati, based in Boston, co-edits Inequality.org at the Institute for Policy Studies. His books include The Case for a Maximum Wage and The Rich Don’t Always Win.

Jim Hightower: The asset strippers destroying local newspapers

Via OtherWords.org

Editor’s note: Gannett owns many New England newspapers, including The Providence Journal and The Worcester Telegram.

My newspaper died.

Well, technically it still appears. But it has no life, no news, and barely a pulse. It’s a mere semblance of a real paper, one of the hundreds of local journalism zombies staggering along in cities and towns that had long relied on them.

Each one has a bare number of subscribers keeping it going, mostly longtime readers like me clinging to a memory of what used to be and a flickering hope that, surely, the thing won’t get worse. Then it does.

Our papers are getting worse at a time we desperately need them to get better. Why? Because they are no longer mediums of journalism, civic purpose, or local identity.

Rather, they’ve been reduced to little more than profit siphons, steadily piping local money to a handful of distant, high-finance syndicates that have bought out our hometown journals. My daily, the Austin American-Statesman, was swallowed up in 2019 by the nationwide Gannett chain, becoming one of more than 1,000 local papers that Gannett mass produces under its corporate banner, “the USA Today Network.”

But even that reference is a deception. The publication doesn’t confide to readers that it’s actually a product of SoftBank Group, a multibillion-dollar Japanese financial consortium that owns and controls Gannett.

SoftBank has no interest in Austin as a place, a community, or even as a newspaper market, nor does it care one whit about advancing the principles of journalism. It’s in the profit business, extracting maximum short-term payouts from the properties it owns.

This has rapidly become the standard business model for American newspapering. Today, more than half of all daily papers in America are in the grip of just 10 of these money syndicates. That’s why our “local” papers are dying.

It’s not a failure of journalism. It’s a plunder of journalism by absentee corporate owners.

Jim Hightower is a columnist, public speaker and author.

Shailly Gupta Barnes: Census data show that anti-poverty programs work

Homeless man in Boston

— Photo by Enver Rahmanov

The Town Farm, in Easthampton Mass. Now called the Easthampton Lodging House, it’s an historic poor farm at 75 Oliver St. It was established in 1890 as an inexpensive way to provide for the town's indigent population, and is the only locally run facility of its type to survive in the state. The property was listed on the National Register of Historic Places in 1996. Poor farms, which housed the penniless, some of whom paid for this with farm work, were a feature of many New England communities into the 20th Century.

— Photo by John Phelan

Via OtherWords.org

The U.S. Census Bureau recently reported that poverty dropped notably in 2021. Amid a pandemic and widespread economic pain, this is a significant accomplishment.

There are three lessons here — about government programs, about how we measure poverty, and about how far we have left to go.

First, these numbers show that government programs work. After Social Security, refundable tax credits like the expanded Child Tax Credit (CTC) and stimulus payments were the biggest contributors to reducing poverty.

Without them, over 20 million more people would have been poor last year. The expanded CTC alone lifted millions of children above the poverty line and reduced racial inequities among poor children.

These programs worked because they departed significantly from how anti-poverty programs have worked for the past 30 years. They provided direct cash transfers to recipients, without any work requirements or bureaucratic indignities.

Welfare-rights organizers have been pushing for these changes for decades. This year, they were proven right.

But unfortunately, official federal poverty figures still conceal the true number of people who are struggling — and underestimate the scale of our responsibility to help them.

At just $31,000 for a family of four, the federal government’s Supplemental Poverty Measure, or SPM, is far too low. That’s less than half of the typical cost of living for a family this size in rural Mississippi, or just one-third for Chicago. And the official poverty measure, or OPM, is even lower.

I’m the policy director of the Poor People’s Campaign, which defines poverty to include everyone living up to 200 percent of the SPM.

Using this measure, which is still less than median income, we counted 140 million people — or 43 percent of the country — who were poor or one emergency away from being poor before the pandemic. In 2021, this rate went down to about 34 percent, or 112 million people.

This is a significant decrease. But it means over a third of our nation has little to celebrate.

In fact, the population living between 100 percent and 200 percent of the SPM threshold stayed basically the same between 2020 and 2021: nearly 90 million people, just one emergency away from poverty. If we only looked at the poverty rate, we would have missed them entirely.

That means we can and must do more. The expanded CTC expired in December 2021, and there has been no further discussion of reviving stimulus payments — even with the federal minimum wage at its lowest value in 66 years and the cost of living continuing to rise.

This is not to minimize the gains we’ve made. They just remind us that poverty is a policy choice — and fortunately, we can make different choices.

In 2020, there were over 80 million eligible poor and low-income voters. Fifty million of them voted in the presidential contest, accounting for a third of the electorate overall and even higher percentages in key states in the Midwest and South.

These voters share a common interest in securing health care, living wages, decent housing, and safe schools for their kids. If they could be organized to take action together — across race, religion, and other lines of division — we could advance the moral policies we need to fully address poverty.

“What’s hurting me in Kentucky is hurting you in Alabama, in West Virginia, and across the nation,” said Tayna Fogle, a leader in the Kentucky Poor People’s Campaign, earlier this year.

“Can you imagine all the poor and the low-income people coming to the ballot box?” she asked. “What if we did everything we could to make sure that our vote counted? We could overturn this madness that’s going on.”

If poor people vote in the midterms like they did in 2020, we could make another leap towards ending the madness of widespread poverty in the midst of plenty.

Shailly Gupta Barnes is the policy director for the Poor People’s Campaign: A National Call for Moral Revival and the Kairos Center.

Companies’ creepy surveillance of their own workers

The evil dictator in George Orwell’s 1984

Via OtherWords.org

For generations, workers have been punished by corporate bosses for watching the clock. But now, the corporate clock is watching workers.

Called “digital productivity monitoring,” this surveillance is done by an integrated computer system including a real-time clock, camera, keyboard tracker, and algorithms to provide a second-by-second record of what each employee is doing.

Amazon founder Jeff Bezos pioneered use of this ticking electronic eye in his monstrous warehouses, forcing hapless, low-paid “pickers” to sprint down cavernous stacks of consumer stuff to fill online orders, pronto — beat the clock, or be fired.

Terrific idea, exclaimed taskmasters at hospital chains, banks, tech giants, newspapers, colleges, and other outfits employing millions of mid-level professionals.

They’ve been installing these unblinking digital snoops to watch their employees, even timing their bathroom breaks and constantly eying each one’s pace of work. They’ve plugged in new software with such Orwellian names as WorkSmart and Time Doctor to count worker’s keystrokes and to snap pictures every 10 minutes of workers’ faces and screens, recording all on digital scoreboards.

You are paid only for the minutes the computers “see” you in action. Bosses hail the electronic minders as “Fitbits” of productivity, spurring workers to keep noses to the grindstone, and also to instill workplace honesty.

Only… the whole scheme is dishonest.

No employee’s worthiness can be measured in keystrokes and 10-minute snapshots! What about thinking, conferring with colleagues, or listening to customers? No “productivity points” are awarded for that work.

For example, The New York Times reports that the multibillion-dollar United Health Group marks its drug-addiction therapists “idle” if they are conversing off-line with patients, leaving their keyboards inactive.

Employees call this digital management “demoralizing,” “toxic,” and “just wrong.” But corporate investors are pouring billions into it. Which group do you trust to shape America’s workplace?

OtherWords columnist Jim Hightower is a radio commentator, writer and public speaker.

Sam Pizzigati: Keeping workers poor is bad for business

1917 caricature

Via OtherWords.org

BOSTON

CEOs at America’s biggest low-wage employers now take home, on average, 670 times what their typical workers make.

But we don’t just get unfairness when a boss can grab more in a year than a worker could make in over six centuries. We get bungling and inefficient businesses.

Management science has been clear on this point for generations, ever since the days of the late Peter Drucker.

Management theorists credit Drucker, a refugee from Nazism in the 1930s, for laying down “the foundations of management as a scientific discipline.” Drucker’s classic 1946 study of General Motors established him as the nation’s foremost authority on corporate effectiveness.

That effectiveness, Drucker believed, had to rest on fairness.

Corporations that compensate their CEOs at rates far outpacing average worker pay create cultures where organizational excellence can never take root. These corporations create ever bigger bureaucracies, with endless layers of management that serve only to prop up huge paychecks at the top.

Drucker argued that no executive should make more than 25 times what their workers earn. And, in the two decades after World War II, America’s leading corporate chiefs by and large accepted Drucker’s perspective.

Their companies shared the wealth when they bargained with the strong unions of the postwar years. In fact, notes the Economic Policy Institute, major U.S. corporate CEOs in 1965 were only realizing 21 times the pay their workers were pocketing.

Drucker died in 2005 at 95. He lived long enough to see Corporate America make a mockery of his 25-to-1 standard. But research since his death has consistently reaffirmed his take on the negative impact of wide CEO-worker pay differentials.

The just-released 28th annual edition of the Institute for Policy Studies’ Executive Excess report explores these wide differentials in eye-opening detail. The report zeroes in on the 300 major U.S. corporations that pay their median workers the least.

At these 300 firms, average CEO pay last year jumped to $10.6 million, some 670 times their $24,000 median worker pay.

At over 100 of these firms, worker pay didn’t even keep with inflation. And at most of those companies, executives wasted millions buying back their own stock instead of giving workers a raise.

Just as Drucker predicted, this unfairness has led directly to performance issues. Many of our nation’s most unequal companies, from Amazon to federal call-center contractor Maximus, have seen repeated walkouts and protests from justifiably aggrieved workers.

Lawmakers in Congress, the Institute for Policy Studies points out, could be taking concrete steps to rein in extreme pay disparities. They could, for instance, raise taxes on corporations with outrageously wide pay gaps.

But with this Congress unlikely to act, the new Institute for Policy Studies report also highlights a promising move the Biden administration could take on its own. The administration could start using executive action “to give corporations with narrow pay ratios preferential treatment in government contracting.”

That would amount to a major step forward, since 40 percent of our largest low-wage employers hold federal contracts. If the Biden administration denied lucrative government contracts to companies with pay gaps over 100 to 1, those low-wage firms would have a powerful incentive to pay workers more fairly.

Various federal programs already offer a leg up in contracting to targeted groups, typically small businesses owned by women, disabled veterans, and minorities.

“Using public procurement to address extreme disparities within large corporations,” the IPS report adds, “would be a step towards the same general objective.”

And a step in that direction, as Peter Drucker told Wall Street Journal readers back in 1977, would honor the great achievement of American business in the middle of the 20th Century: “the steady narrowing of the income gap between the ‘big boss’ and the ‘working man.

Sam Pizzigati, based in Boston, co-edits Inequality.org at the Institute for Policy Studies. His latest books include The Case for a Maximum Wage and The Rich Don’t Always Win.

Brian Wakamo: A legal victory for America’s most dominant pro-sports team

A ticker tape parade in Manhattan celebrating the U.S. Women’s National Soccer Team’s 2015 World Cup victory.

Via OtherWords.org

Three years ago, the U.S. Women’s National Soccer Team filed a $24 million gender-discrimination lawsuit against the U.S. Soccer Federation. This May, after a prolonged and public battle, the players association for the U.S. women’s and men’s national teams negotiated a groundbreaking collective bargaining agreement.

The agreement enshrines a number of new protections for both teams. But most importantly, the agreement creates equal pay structures and requires the U.S. Soccer Federation to share World Cup prize money equally between both the men and women’s national teams.

It’s a first for any soccer federation in the world — and an inspiring victory for fairness in any industry.

Consider the women’s team’s impressive record — which includes four World Cup wins, four Olympic gold medals, and FIFA’s world No. 1 ranking for five straight years. The men’s team, by comparison, failed to qualify for the World Cup in 2018 and hasn’t made the quarterfinals or better in the World Cup since 2002.

Under the previous rules, had the men’s team qualified in 2018, they would have likely received first-round exit prize money worth $8 million — double what the women’s team took home for winning the 2019 Women’s World Cup.

Now the two teams will get equal pay for equal success.

This agreement would not have been possible without decades of tireless activism from players who have decried the double standards present in U.S. and global soccer.

Whether it was turning their warm-up jerseys inside out to obscure the U.S. Soccer Federation crests or kneeling in support of racial justice, the U.S. women’s team embodies a culture of protest that reflects the ongoing struggles of women and marginalized groups across the world.

It’s not hard to see the parallels in the broader economy.

Men, for example, make up an overwhelming majority of top earners across the U.S. economy, even though women now represent almost about the country’s workforce. At the top 0.1 percent level, women make up only 11 percent.

But there’s another important parallel in how the teams corrected this imbalance: unions.

This equal pay for equal success victory could not have been achieved without the collective strength and solidarity that a union provides. By coming together in their contract negotiations, the men’s and women’s teams both inspire and benefit each other.

In the latest collective-bargaining agreement, for example, athletes on the men’s national team will now have access to paid child care, a benefit the women’s team has enjoyed for over 25 years. This agreement is a testament to how everyone can win when you fight for those at the bottom.

Even beyond soccer and beyond the United States, the contract is groundbreaking.

It provides a roadmap to equity for other national sports teams, like basketball and hockey, which face similar challenges. It could also be replicated in places like France or Germany, where teams have an even higher level of success and larger budgets than the U.S. Soccer Federation.

But it’s also a roadmap for those of us who aren’t professional athletes.

As unionization efforts take flight at Starbucks, Amazon, and other big, profitable employers, America’s most dominant national sports team is showing how the workers who make companies successful can claim their fair share of the rewards.

Goal!

Brian Wakamo is an Inequality Research Analyst at the Institute for Policy Studies and a co-editor of Inequality.org.

Jim Hightower: Blame greedy corporate execs for surge in U.S. inflation

“The Worship of Mammon” (1909), by Evelyn De Morgan

Via OtherWords.org

Today, CEOs of big corporations are playing the tricky “Inflation Blame Game.”

Publicly, they moan that the pandemic is slamming their poor corporations with factory shutdowns, supply chain delays, wage hikes, and other increased costs. But inside their board rooms, executives are high fiving each other and pocketing bonuses.

What’s going on?

The trick is that these giants are in non-competitive markets operating as monopolies, so they can set prices, mug you and me, and scamper away with record profits. In 2019 for example, before the pandemic, corporate behemoths hauled in roughly a trillion dollars in profit. In 2021, during the pandemic, they grabbed more than $1.7 trillion.

This huge profit jump accounts for 60 percent of the inflation now slapping U.S. families!

Take supermarket goliath Kroger. Its CEO gloated last summer that “a little bit of inflation is always good in our business,” adding that “we’ve been very comfortable with our ability to pass on [price] increases” to consumers.

“Comfortable” indeed. Last year, Kroger used its monopoly pricing power to reap record profits. Then it spent $1.5 billion of those gains not to benefit consumers or workers, but to buy back its own stock — a scam that siphons profits to top executives and big shareholders.

Or take the fast-food purveyor McDonald’s. Executives bragged to their shareholders that despite the supply disruptions of the pandemic and higher costs for meat and labor, its top executives had used the chain’s monopoly power in 2021 to up prices, thus increasing corporate profits by a stunning 59 percent over the previous year.

And the game goes on: “We’re going to have the best growth we’ve ever had this year,” Wall Street banking titan Jamie Dimon exalted at the start of 2022.

Hocus Pocus — this is how the rich get richer and inequality “happens.”

OtherWords columnist Jim Hightower is a radio commentator, writer and public speaker.

Sam Pizzigati: Time for a Tom Paine tax program

BOSTON

From OtherWords.org

The great pamphleteer of the American Revolution, Thomas Paine, had much more on his mind than independence from the British.

Paine spent his life, Jeremy Bearer-Friend and Vanessa Williamson write in a new paper, advocating for a democratic “commonwealth” that shared the wealth. He wanted to free people “from domination both political and economic.”

In particular, Paine believed that a wealth tax on grand private fortunes could prevent the emergence of an anti-democratic elite. This tax season, over two centuries later, we may finally have a president who’s taking Paine to heart.

In its new budget proposal, the Biden administration is calling for a new “Billionaire Minimum Income Tax.” The White House isn’t calling this proposal a “wealth tax,” but we should.

Under Biden’s plan, Americans worth over $100 million would be expected to pay an annual tax of at least 20 percent on their total income — including any increases in the value of their stocks, bonds, and other liquid assets.

These liquid assets make up the bulk of every billionaire fortune, but increases in their value go totally untaxed until their wealthy owners decide to sell them off. That gives “ultra-high-net-worth households,” the White House points out, the ability to have their gains “go untaxed for decades or generations.”

Let’s take the example of a CEO who pockets $20 million a year in salary. He might pay a 20 percent tax on that $20 million.

But if this executive also holds stocks worth $10 billion and those stocks gain 10 percent in value — an extra $1 billion — then the vast majority of our CEO’s real income would go completely untaxed.

Under Biden’s plan, that CEO would have to pay taxes on his CEO pay and all his stock gains. That would hike his federal tax tab from $4 million to $204 million.

America’s 700 or so billionaires, the Biden administration notes, saw “their wealth increase by $1 trillion” last year. Yet current law has billionaires paying “just 8 percent of their total realized and unrealized income in taxes.”

That’s right: Billionaires pay at a lower overall rate than average Americans.

“Under current law, when an American worker earns a dollar of wages, that dollar is taxed as they earn it,” the White House explains. “But when a billionaire earns income because their investments increase in value, that gain is too often never taxed at all.”

Firefighters and teachers, adds the White House, “can pay double” the rate billionaires pay.

The Biden tax plan is actually taking much the same approach that Tom Paine took with a wealth tax proposal he first put forward in 1792, tax historians Bearer-Friend and Williamson argue.

Under Paine’s plan, the pair calculate, today’s billionaires would pay a tax of about 3.5 percent of their personal fortunes during normal market years. That figure is remarkably close to the tax rates that appear in wealth tax proposals that Senators Elizabeth Warren (D.-Mass) and Bernie Sanders (I.-Vt.) have advanced.

Biden’s plan doesn’t take that big a bite. But it does represent a significant step toward taxing the wealth of America’s wealthiest, says Berkeley economist Gabriel Zucman.

Mega-billionaires Jeff Bezos, Warren Buffett, and Elon Musk, Zucman reminds us, together paid just $1.5 billion in federal income taxes over the five-year period that ended in 2018. Under the Biden proposal, this trio would pay at least 100 times more over the next decade or so.

Paine believed that extreme wealth undermines “the ability of citizens to choose their leaders,” Bearer-Friend and Vanessa Williamson argue, a condition that many will easily recognize today. Freedom, in Paine’s view, “meant both lifting the poor from penury and dependence” and eliminating the “vicious influence” of fiercely concentrated wealth.

Tom Paine had it right. And if Congress takes up Biden’s new tax plan, we can too.

Sam Pizzigati, based in Boston, co-edits Inequality.org at the Institute for Policy Studies. His latest books include The Case for a Maximum Wage and The Rich Don’t Always Win.

Lindsay Owens: Firms use ‘inflation’ as cover for price-gouging and record profits

1904 cartoon warning attendees of the St. Louis World's Fair of hotel room price-gouging.

Via OtherWords.org

If you’ve been slammed lately by higher prices on everything from groceries to rental cars and gas prices, you’re probably wondering what on earth is behind these skyrocketing costs.

Corporations are quick to blame this new reality on the pandemic, but another major culprit is hiding in plain sight: their own profiteering.

Four times a year, corporations are required by law to update their investors on how they’re doing in terms of sales and profits. These are called “earnings reports,” and the companies will usually hold calls with the investors to walk them through the latest report.

My organization, Groundwork Collaborative, recently got our hands on the transcripts from hundreds of these earnings calls. And you won’t believe what CEOs are boasting about.

Knowing that the current inflation frenzy is a convenient scapegoat, these companies are charging customers even more to pad their profit margins. They are just admitting it — they’re openly bragging to investors about how well it’s working.

“I think we’ve done a great job with our pricing,” boasted the CFO of Hormel, a maker of popular grocery brands. “I think it’s been very effective.” As prices went up, the company improved its operating income by 19 percent in the first quarter of 2022 compared to 2021.

Constellation Brands, the parent company of popular beers Modelo and Corona, is also engaging in bald-faced profiteering. On its January call, Constellation’s CFO admitted that its consumer base “skews a bit more Hispanic” and the company wants to “take as much as [we] can” from them.

And now, the conflict in Ukraine is providing yet another opportunity for oil and gas companies to pad their bottom lines. “It’s tragic what’s going on in Eastern Europe,” said one oil executive in late February. “But if anything, these high prices, the volatility, drive even more energy security and long-term contracting.”

This pandemic profiteering is taking a massive toll on consumers, workers and small businesses.

Low-income Americans are pinching pennies to feed their families and pay their bills. And while mega-companies can use their market power to raise prices and generate record profits, small businesses and independent retailers are struggling to keep their doors open.

The appalling price-gouging and monopolistic behavior we’re monitoring comes on top of decades of disinvestment in our workers and supply chain, excessive corporate power and financial markets maximizing short-term profits. This broken system left us wholly unprepared to accommodate increases in demand.

But make no mistake: next time you experience sticker shock in the checkout line, it’s a safe bet that corporate executives and shareholders are reaping the rewards.

People are catching on: A new poll from Data for Progress and Groundwork finds that 63 percent of voters believe that “large corporations are taking advantage of the pandemic to raise prices unfairly on consumers and increase profits.”

Policy makers are taking notice, too. The New York state attorney general’s office just announced new price-gouging rules, paving the way for other states to follow suit.

And days after President Biden promised action on pandemic price-gouging, congressional oversight panels opened investigations into the three major ocean shipping alliances. These outfits control about 80 percent of seaborne cargo and have seen their profits increase seven-fold from the previous year.

Finally, a recently introduced bill, the COVID-19 Price Gouging Prevention Act, would help the Federal Trade Commission and State Attorneys General protect people across the country from pandemic profiteering.

Without competition and robust regulation to keep them in check, big corporations have gotten away with using the pandemic to push up prices and fatten their profit margins — and if they aren’t reined in, high prices could be here to stay.

Lindsay Owens is the executive director of Groundwork Collaborative.

Samantha Garcia: We shouldn’t have to rely on National Guard for basic services

National Guard members perform multiple tasks at a COVID-19 test site at Rhode Island College in May 2020.

From OtherWords.org

As the highly transmissible Omicron variant continues to spread, hospitals across the country have reported critical staff shortages. In my home state of New Mexico, nearly half of all hospitals are understaffed, and more could be soon.

The U.S. health-care system has buckled under the strain of the pandemic. COVID-19 hospitalizations reached a peak in early January, nearly two years in. According to the American Hospital Association, “we’re facing a national emergency” as health care facilities simply don’t have enough workers to keep up with these surges.

With worker shortages now plaguing hospitals, nursing homes, and other long-term care facilities, states have turned to the National Guard for relief. So too have school districts, child-care facilities, and communities reeling from natural disasters.

Montgomery County, Md., for example, recently called on the Guard to fill in as public school-bus drivers. In fact, school district leaders in at least 11 states have turned to the Guard to shuttle students to school amid acute bus driver shortages.

New Mexico recently became the first state in the nation to recruit Guard troops to fill in as substitute teachers and day-care workers, but even that’s not meeting demand.

As schools struggle to stay open, some school administrators are covering custodial duties while parent volunteers fill in as cafeteria workers, classroom support, and COVID-19 testing aides. Even New Mexico Gov. Lujan Grisham is stepping into the classroom as a substitute.

Meanwhile, there’s the increasingly constant need for disaster response. Last year, Guard members were deployed across the West to support overstretched firefighting crews. And this past January, the Virginia Guard deployed members to support winter storm response.

According to the National Guard Bureau, more than 19,000 National Guard members are now mobilized across the country to support pandemic-related relief efforts. At other times, up to 47,000 have been deployed to meet pandemic demand.

“From the beginning of the pandemic, National Guard men and women in each of the 50 states, three territories, and the District of Columbia have been on the front lines,” said Army Gen. Daniel R. Hokanson, the Guard’s bureau chief. “We continue to work closely with the states to ensure” that we’re “meeting their needs.”

Certainly, National Guard members have stepped up heroically to serve their communities. But it’s worth asking: Why has the Guard become the “Swiss army knife” to meet states’ emergency needs?

To put it another way: Time and again, why is it only the military that has extra resources to go around? The simplest answer is we’ve spent decades ramping up our military spending while letting these other priorities stagnate.

For what taxpayers spent on military contractors alone last year, we could have instead provided health care for 25 million low-income adults and 38 million children. We could have funded over a million elementary school teachers. And we could have launched over a million clean-energy jobs — all with money to spare.

Instead communities are often left seeking help from the military to fill these roles.

Meanwhile, military spending is only going up. Congress recently passed a $778 billion military budget bill — a peacetime record.

All that spending is supposed to make us safer. But as critical public services reach their breaking point, it’s clear that short-changing our health, our children, and our planet has left us less safe.

As the pandemic and climate crisis are showing us, real security means divesting from  excessive military spending and prioritizing the things we actually need to flourish — so maybe next time there won’t be a crisis.

Samantha Garcia is the New Mexico Fellow at the Institute for Policy Studies.

Jim Hightower: Save our political cartoonists from Wall Street

Theodore Roosevelt introduces William Howard Taft as his crown prince in a 1906 Puck magazine cover.

“Join, or Die,’’ by Benjamin Franklin (1754), a cartoon on the disunity of the Thirteen Colonies during the French and Indian War. It was later used to encourage the former colonies to unite for the cause of independence during the Revolutionary War.

Via OtherWords. org

Right before our eyes, an invaluable American species is fast disappearing from view: Kartoonus Amerikanas.

These are the newspaper cartoonists who’ve long delighted readers and infuriated power elites. And there’s nothing natural about their sudden decline. It’s not the result of a declining talent pool, and certainly not due to a lack of political targets.

What’s happening is that their media habitat is being intentionally destroyed.

Around the start of the 20th Century, some 2,000 newspapers featured their own full-time cartoonists. But in just the last decade, those healthy media environments have shriveled. So now, only a couple dozen newspapers have these vibrant artistic journalists on staff.

One major reason is that most U.S. papers have been gobbled up by profiteering hedge funds that have merged, purged and plundered these essential local sources of news and democratic discourse. The overriding interest of these Wall Street owners is to cash out a paper’s financial assets and haul off the booty to boost their personal wealth — journalism and democracy be damned.

They view cartoonists as a paycheck that can be easily diverted into their corporate pockets, dismissing the fact that enjoying good local cartoonists ranks as one of top reasons people give for buying the paper.

Note that this mass extermination is not old-school media censorship, but slight-of-hand financial censorship by the new monopolistic order of newspapering.

Political cartoonists are still free to express any opinion they want, but the Wall Street system locks them out of their primary marketplace. Censorship is ugly, but eliminating paychecks — well, that’s just business.

The good news is that these freewheeling artistic spirits of the cartooning craft are inventing new ways to connect with America’s strong consumer demand for their fun and important work. To get connected and get active with them, go to EditorialCartoonists.com.

OtherWords columnist Jim Hightower is a radio commentator, writer, and public speaker.

Sam Pizzigati: Amazon’s business model can kill

From OtherWords.org

BOSTON

Old-school home-improvement contractors have a piece of folk wisdom they love to share with prospective clients. “Listen,” they like to say. “I can do this job fast, I can do it cheap, or I can do it well. But I can’t do all three.”

This wisdom has been around forever. But not everyone gets it — take billionaire Jeff Bezos. His Amazon empire prides itself on delivering good results fast and cheap.

That works well enough for Bezos, now worth around $200 billion. And Amazon consumers, the company PR maintains, can get almost whatever they want quickly and cheaply. But for Amazon workers — and our broader society — Amazon’s empire building has been anything but good.

That became disastrously apparent this month, when a tornado swept through Edwardsville, Ill., leaving six Amazon warehouse workers dead. Debris from their workplace turned up “tens of miles” away, the National Weather Service reported.

Unfortunately, this tragedy should not have taken anyone by surprise.

Why did Amazon locate its Edwardsville operations right in Tornado Alley? No mystery there. Edwardsville’s plentiful acreage and easy access to interstate highways, airports, and other transport offered Amazon the promise of speedy delivery times and lower delivery costs.

Check fast. Check cheap. But the warehouse went up with no special attention to tornado safety. That would have raised the cost.

OSHA — the federal occupational health and safety agency — has now begun an investigation. Since the deaths in Edwardsville, Amazon workers throughout the southern Illinois area have been ripping the company for failing to conduct tornado drills and expecting workers to keep working even after alarms ring out.

Amazon’s “storm shelter” spaces for Edwardsville workers turned out to have another name: bathrooms. Moments before the tornado’s arrival, Edwardsville worker Craig Yost told local news, Amazon supervisors were directing people into their worksite’s bathroom “shelters.”

“The walls caved in, and I got pinned to the ground by a giant block of concrete,” Yost said. “On top of my left knee was a door from the bathroom stall, and my head was on that with my left arm wrapped around my head. I could just move my right hand and foot.”

Meanwhile, the company has been actively exercising its considerable power to prevent the one turn of events that could reliably keep Amazon on its safety toes: a union. Earlier this year, Amazon quashed a union drive at its Bessemer, Ala., warehouse so egregiously that the National Labor Relations board has ordered a do-over on the election.

But the problem goes beyond Amazon. Our nation’s corporate giants have been on a ferocious 50-year offensive against collective bargaining.

In the mid-20th Century, over a third of America’s private-sector workers belonged to unions. Now only 6.3 percent of private-sector workers carry union cards, despite polling data showing that the share of nonunion workers who want a union at their worksite has increased markedly.

Corporate America’s squeeze on unions has kept wages low, share prices high and compensation for top executives at stratospheric levels. Earlier this year, Institute for Policy Studies research revealed that CEOs at America’s 100 largest low-wage employers saw their personal compensation jump by $1,862,270 in 2020.

Over the past year, Jeff Bezos has seen his wealth soar by over $4 billion — seven times the annual budget of OSHA, the agency investigating the disaster at his Edwardsville warehouse. So here’s an idea for lawmakers in Washington: A 5 percent annual federal wealth tax on those Bezos billions could quadruple the annual OSHA budget — and then quadruple it again.

Amazon’s relentless quest to sell goods fast and cheap has rewarded Bezos tremendously, but it’s come at a huge cost for the rest of us. If the company rebuilds its Edwardsville warehouse, Bezos should listen to his handyma\

Sam Pizzigati, who is based in Boston, co-edits Inequality.org at the Institute for Policy Studies. His latest books include The Case for a Maximum Wage and The Rich Don’t Always Win.