Labor Union Blog

This is a cross-post from Working America’s Main Street blog.

Working America members, teachers and unemployed Pennsylvanians on both sides of the state delivered more than 1,000 handwritten postcards to Gov. Tom Corbett’s regional offices in Pittsburgh and Philadelphia. We wanted Corbett to know the drastic, widespread and ultimately disastrous results of the budget cuts he enacted last year. We wanted him to make good on the rhetoric used in his first year, which called for “shared sacrifice.”

There has been a great deal of sacrifice. But it has not been shared. It has been targeted, acute and painful. And while the brunt has fallen on students, low-income families and public workers, 70 percent of Pennsylvania’s businesses pay nothing in income taxes.

“The budget cuts have added to the pool of unemployed workers by contributing to the elimination of 14,000 jobs in education alone,” says Mary Karscig, an unemployed nurse and Working America member who wrote to Corbett. Some 21,000 Pennsylvanians lost their jobs due to budget cuts alone, many of them due to nearly $900 million slashed from public education. We’ve written about the many school districts in Pennsylvania now facing the fiscal brink, with the bankrupt Chester Upland School District as a sign of things to come. The New York Times reported yesterday that 75 percent of Pennsylvania classrooms now have more kids than they did in 2010.

“I feel worried about the impacts of these cuts on my job search, and I am even more worried about their impacts on my son’s job search,” says Mary.

She adds: “My son will go wherever there is a job, and there is a pretty high chance he’ll have to move out of state.”

We were hoping that this morning’s budget announcement would bring some reprieve to working Pennsylvanians like Mary for the next fiscal year. No such luck. K-12 education did not get the recoup it needed. This time, the biggest ax fell on higher education: a 17 percent cut to public universities, state-related schools like Penn State, and the 14 state-owned universities.

In another devastating move, $30 million was cut from the Welfare Department, eliminating cash assistance for 60,000 of the most vulnerable Pennsylvanians; Philadelphia Sen. Vincent Hughes said this was the governor “putting his foot on the neck of poor people.”

“Last year, Gov. Corbett talked a lot about shared sacrifice,” said Kim McMurray, Working America’s Pennsylvania state director. “While 70 percent of businesses in Pennsylvania aren’t paying any income taxes to the state because of corporate tax loopholes, schools are running out of money and families are losing their homes. Does that look like shared sacrifice to you?”

Despite the time, thought and concern reflected in the postcards, our Pittsburgh members, staff and allies were refused entrance into Gov. Corbett’s office. In fact, we were told at the door that the building was private property, and the group was not allowed to enter. So the delegation delivered the 500 postcards, the community letter and the report card to the building staff at the entrance of the building where the governor has his office. Corbett needs to understand the effects of his far-reaching, short-sighted cuts, and we’re going to keep fighting to make sure he hears us.

Donna Gratehouse, who blogs at DemocraticDiva and elsewhere on all things Arizona, sends us this.

As Arizona’s “Wisconsin on Steroids” anti-worker bills get streamlined through committee hearings, Arizona labor leaders are gearing up to push back. This afternoon, I spoke with Roman Ulman, executive director of AFSCME Arizona. Ulman told me union leaders are still meeting with legislators at this point, urging them to support working families over corporate interests. As he said:

Senators on both sides of the aisle are telling me they are uncomfortable with the bills and are pleased that we’re talking and not walking at this point. Some of the Republicans have privately expressed to me that they’re tired of being terrorized by the Goldwater Institute and the Tea Party into voting for bad legislation. They want to focus on the budget and solving Arizona’s problems.

(Click here to sign a petition to tell all Arizona lawmakers to stop the attacks on firefighters, teachers, police officers and other hard-working public service workers.)

Private conversations aside, even the more principled Republican lawmakers in Arizona have a history of caving under under corporate pressure so it is expected that the majority will vote for the bills in the end. Ulman says union members and allies are prepared for that.

If it moves out of the Senate, all bets are off and we will march and take our case to the public.

Labor and community groups plan to hold a press conference on the lawn of the State Capitol in Phoenix on Thursday afternoon and are expecting a good sized crowd to turn out.

The Goldwater Institute has been working diligently to pit private-sector workers against public-sector workers, so much so that they’ve taken to pretending to support private sector unions!

Which is odd because I had never known the folks at the Goldwater Institute, who support right to work laws with the same fervor that they oppose minimum wage laws, to be fans of any kind of union. So I asked Ulman about that and he agreed that it was preposterous. “They’re against all unions!”
He says the unions have noticed this new tack by the Goldwater Institute too, and they aren’t buying it.

Some of them trip up and admit they want to end all the unions but the smoother ones are sticking to the script. They’re running a stealth operation and they’ll say anything to move their agenda forward.

Ulman assured me that Arizona’s public-sector unions have the full support of private-sector unions.

People are so geeked up right now I’m having to tell them to calm down!

Last year, despite some twisted political maneuvering and trickery by New Hampshire House Speaker William O’Brien (R), he and other anti-worker lawmakers and their out-of-state backers could not override Gov. John Lynch’s (D) veto of a right to work for less bill.  With a new legislative session underway, they’re back at it again.

Thursday, the House labor Committee will hold a hearing on a new right to work (RTW) bill. Although  the calendar may have changed, the facts haven’t—right to work is still wrong for New Hampshire, a new Economic Policy Institute (EPI) report finds.

Political economist Gordon Lafer provides new evidence that RTW laws have failed as economic development strategies and would likely harm New Hampshire.  Right to Work: A Failed Policy, A New Hampshire Update strengthens the findings of Right-to-Work: Wrong for New Hampshire, an analysis of why RTW was particularly unsuited to New Hampshire that EPI released last April.

Some of the new evidence Lafer examines that confirms the harm that RTW has caused to state economies includes:

• A 2012 study by economists from the University of Nevada and Claremont McKenna College estimates that the damage RTW inflicts on nonunion employees is greater than earlier research suggested.
• A recent survey of manufacturers found that RTW status has fallen (to 16th place) in the list of factors influencing location decisions.
• An Oklahoma think tank that promoted the adoption of a RTW law reported that the state has in fact lost manufacturing jobs and become a next job exporter in the years since.
• A new study finds that workplaces in the construction industry are less safe in RTW states than in non-RTW states.
• Recent unemployment data show that New Hampshire continues to outperform RTW states.

Click here for the full report.

Sort of like that periodic rash that you can’t scratch in public, Richard Berman is back. Berman is best known to us in the union movement for his so-called “Center on Union Facts” that is to facts what Bernie Madoff is to secure investments.

Now, Berman has launched a $10 million campaign, writes the National Journal, to help push new federal anti-union legislation under the 180-degree-from-the-truth title the Employee Rights Act.

Part of that $10 million helped buy a 30-second spot in selected markets—during the Super Bowl that earned three “Pinocchios” from the Washington Post’s Fact Checker on campaigning and advocacy ads for using “nonsense” facts to make its claim. A trio of long-nosed wooden Italian puppets means that add contains “Significant factual error and/or obvious contradictions.”

BTW, there was bit more fantasy in the ad. Super corporate insider Berman played a mechanic in the ad. Now there’s some acting, playing someone who gives an honest day’s work.

Berman also runs corporate financed “astro-turf” campaigns that masquerade as grassroots movements against consumer, safety, health, environmental, corporate and financial regulations. Berman’s anti-union phony front group does not reveal its donors. But according to The Republic Report, it has been reported that the group coordinates with the Big Business-backed U.S. Chamber of Commerce.

In the past, Berman has taken money from corporations—including from Wendy’s, Phillip Morris, Tyson Foods, Cargill, and Coco-Cola—to orchestrate “fake grass-roots websites and movements.”

With the 2012 election year heating up, don’t be surprised if you see more of Berman’s ads’ popping on the air or in print.  But the next time you need to scrape some of his “union facts” off your shoes, click here to visit Berman Exposed from Citizens for Responsibility and Ethics in Washington (CREW).

Unemployment as we know it is on the chopping block.

So-called tea party legislators are trying to punish and humiliate people who are out of work—they’re even threatening to take away unemployment insurance from some people completely.

If you believe Congress should be focusing on jobs instead of punishing and even humiliating people who are out of work through no fault of their own, take action now.

These “tea party” politicians are pushing plans to:

• Slash federal unemployment funding by more than half in the states with the highest unemployment.
• Let states whose governments have been taken over by the tea party divert premium money away from unemployment as we know it—and use it to experiment with right-wing social engineering programs (like “workfare,” where people are forced to work for free to get unemployment benefits).
• Mandate drug testing requirements. Politicians are ready to humiliate people who are out of work—by making them urinate in a cup to get benefits they paid for and are entitled to.
• Make jobless workers pay for their re-employment services. People who are out of work through no fault of their own and have paid into the system aren’t asking for a handout—but a helping hand. Now, the radical lawmakers want to make them to pay for the privilege.
• Deny benefits to people who never got their high school diploma lose their right to benefits—they’d have unemployment insurance taken out of their paycheck—but will get nothing should they lose their job. Shame!
• Cut federal employee pensions—or freezing wages for yet another year. Federal workers have already done more than their fair share to balance the budget—while the richest 1% of Americans have been asked to do absolutely nothing.

Tell Congress to focus on jobs rather than punishing jobless workers who have already suffered enough.

This is a cross-post from Jared Bernstein’s blog, On the Economy. Bernstein is a senior fellow at the Center on Budget and Policy Priorities (CBPP) and, from 2009 to 2011, was the chief economist and economic adviser to Vice President Joe Biden.

I’ve always thought the national minimum wage is a lot more important than most people tend to think. By definition, it sets a floor on the low end of the job market, though to their credit, many states now set their minimums above the federal level of $7.25 (Washington State clocks in at a cool $9.04). So it’s a floor, not a ceiling.

Lots of low-wage workers and their families depend on it, and its long slide, as shown in the accompanying chart, especially over the Reagan years, contributed to wage losses and working poverty for many who toil to this day in low-end services.

Of course, when someone raises the idea of a raise, you hear a huge outcry from some in the business lobby. Their generic argument is that the increase will lead to job losses among those low-wage workers affected by the higher wage level. Such workers, they say, will now be “priced out of the labor market.”

Yet, you hear the opposite from groups that represent low-wage workers’ interests, groups like the National Employment Law Project, or NELP (proud disclosure: I’m on their board).

Now, let’s just pause here for a second. The D.C. lobby that represents low-wage employers says they’re against the increase but not because it would raise labor costs and cut into profits, but because it’s bad for the workers themselves, who will suffer reduced hours and layoffs. But the workers’ groups say, “Bring it on!”

Hmmm…who you gonna believe?

In fact, with all this state variation—and some international variation as well (the UK has seen quite sharp increases in its minimum wage since it was re-introduced in the late 1990s)—we’ve had the benefit of natural experiments, rare in economics, enabling econometricians to fight it out as to the job loss effects (here’s mine with the great John Schmitt from a few years back).

It’s a large, gnarly literature, but I think it’s fair to say that most objective parties come away thinking that the hysteria around the increase is overblown. It helps some low-wage workers, most of whom are adults, many of whom have kids. Some studies find small job loss effects, some none.

A much more interesting question, economically speaking, is why don’t we see the horrifics that opponents scream about? I mean, the textbook theory implies that a one penny increase in a market wage should lead to massive unemployment, and that, I can say with 100 percent confidence is not at all what we’ve seen.

In fact, there are numerous other channels through which the higher wage is absorbed:

• Profits: to the extent that the increase is paid for out of profits, we shouldn’t expect job losses. And in an economy where profits have dazzled while paychecks have fizzled, that ain’t a bad thing.
• Prices: some studies find that a small bit gets passed through to higher prices.
• Productivity: to the extent that higher wages reduce turnover and vacancies, a higher minimum can partially pay for itself by squeezing out such inefficiencies. It’s not wishful thinking—some studies have found just that.
• Reasonable rates: it matters what the level you raise it to, and historically, increases have affected less than 10% of the workforce, often even smaller shares. With relatively few in the “affected range” we wouldn’t expect to see large distortions.
• It’s stimulus! Minimum wage workers tend to spend the extra cash, so there’s more economic activity than otherwise would occur—btw, even under the redistributive scenario described under “profits” above, you’ll get this effect if low-wage workers consume more of their last dollar than those in the sky boxes.

Finally, I’ve got to partially give it up to Gov. Mitt Romney (R) as the dude has taken significant incoming from his rivals for advocating indexing the national minimum wage, as is already done in some of those states noted above, so it doesn’t lose value over time as prices rise. It’s an excellent idea in that a) you avoid the dips in the figure below—which shows the real value of the national minimum since 1960, and b) businesses know what to expect. I mean, after all, we index lots of stuff like this, including Social Security and [Earned Income Tax Credits] EITC benefits.

Why just “partially” in terms of giving it up to Mitt? Again, look at the figure. We don’t want to index the national wage to such a historically low level.

So where should we set it? I need to do more research on the question of “affected range” as noted above, but given that a national campaign will take numerous years to gain traction, I suspect I’ll end up in the $9-$10 range, phasing it in starting a year or so down the road. That’s higher than the historical record as shown in the chart, but of course, average wages have gone up considerably over these years and the divergence between the wage floor and the average is both a symptom and a cause of increased earnings inequality (a graph of the minimum wage compared to the average wage would trend downward; I’ll make that soon).

What’s that? I’m dreaming??!! I don’t think so. Surely there’s a minimum wage increase out there in our future. The sooner we get to work on it, the sooner that future arrives.

The AFL-CIO is joining with civil rights, community and labor partners in the re-enactment of the historic 1965 Selma to Montgomery, Ala., civil rights march that will focus attention on new attacks on voting rights, immigrants, workers’ rights and education.

Speaking, at the National Press Club in Washington, D.C., this morning, AFL-CIO Executive Vice President Arlene Holt Baker told reporters:

The onslaught of coordinated attacks on workers’ rights, voting rights, public education and immigration reform is an affront to our democracy.  During the difficult economic times that so many of our communities are facing, we would much rather see our state legislators spending their time focusing on job creation…as opposed to deconstructing  our fundamental rights.

The five-day march will begin on Sunday March 4 in Selma in remembrance of 1965’s “Bloody Sunday” when more than 600 marchers calling for enactment of the Voting Rights Act were met by hundreds of local and state police with billy clubs and tear gas.

The march is being sponsored by National Action Network (NAN) and NAN President the Rev, Al Sharpton said:

It is important that we not just remember what Dr. King and others did in 1965 with the Voting Rights Act that came as a result of the Selma to Montgomery march. We must preserve it against Voter ID Laws and the early voting and voter suppression attempts that are taking place today

Said Holt Baker:

We may be marching from Selma to Montgomery, but this is about the Wisconsins, Ohios, Indianas, Arizonas, the Michigans and any other state where they’re blatantly attacking our rights.