Lloyd Blankfein is CEO of Goldman Sachs, one of the most largest and most notorious investment banks, with $915 billion in assets.
During his appearance on CBS “This Morning,” Blankfein argued that massive income inequality is “a very destabilizing thing.”
Not only does income inequality slow growth, Blankfein said, it also contributes to political divisiveness:
Income inequality is a very destabilizing thing in the country, a very polarizing thing in the country. In other words, it’s responsible for the divisions in the country. Those divisions could get wider. If you can’t legislate, you can’t deal with problems. If you can’t deal with problems, you can’t drive growth, and you can’t drive the success of the country.
But he also said something else. When the show’s host pointed out that many people are speaking out against income inequality but fewer are taking action, the bank CEO agreed. “Yes, full stop. If there was a lever to pull and a button to push, we would pull it and push it.”
Technically he is correct. There is not a lever or a button. But there are very clear policy solutions that would go a long way toward alleviating the destabilizing force of income inequality:
The financial transaction tax. Also called the “Robin Hood tax,” the FTT is a small fee on stock and bond trades, derivative contracts, and swaps of other complex Wall Street instruments. It would amount to about $0.0003 per dollar, or $18 a year for the median 401(k) holder, but would produce an estimated $352 billion in revenue over 10 years. That extra revenue could be used to pay for things Congress claims we can’t afford: renewing unemployment insurance, restoring cuts to SNAP, investments in infrastructure, and assistance to state and local governments who have been forced to layoff thousands. To folks like Blankfein, who has a $2 million salary and tens of millions more in bonuses, the FTT would feel like a blip.
Raise the minimum wage. This is one you’re familiar with. Raising the minimum wage to $10.10, as proposed in the Harkin-Miller bill filibustered by Senate Republicans, would raise the wages of 27.8 million workers, grow GDP by about $22 billion, and create roughly 85,000 net new jobs. As one of the world’s most powerful bankers, Blankfein support for raising the minimum wage–and his refusal to support politicians who oppose it–would have a huge impact.
Stop attacking the CFPB. The banking lobby, of which Goldman Sachs is a large part, viciously opposed the creation of the Consumer Financial Protection Bureau in 2010 (as detailed by author and Massachusetts Senator Elizabeth Warren in her bestselling book). But since its creation, the CFPB has recouped millions of dollars for consumers from mortgage, credit card, and banking companies that were skirting or outright breaking the law. Oftentimes, the offending companies are directly scams at the most vulnerable Americans: debtors, students, veterans, low-income families and families of color. Forget outright support–if Blankfein called off his lobbying team from attacking and attempting to weaken the CFPB, the Bureau’s future and its ability to recoup losses for consumers would be more secure.
Tags: CFPB, Corporate Accountability, Elizabeth Warren, financial transaction tax, goldman sachs, Lloyd Blankfein, minimum wage
Workers at Walmart are mounting a new initiative not only to get their stories of how Walmart’s low wages, disrespect and intimidation are trapping them in a Walmart economy, but how millions of other workers and their families are caught in that same economy.
A Walmart economy is an economy of inequality manipulated by corporations like the $16 billion-a-year-in-profits retail behemoth and other corporations and 1 percenters like the Walton family, the richest in America.
To workers at Walmart, a Walmart economy means “having to decide between paying my bills and being able to take a day off work to stay with my sick daughter,” says LaShanda Myric, a Walmart worker in Denver.
For Richard Wilson who works at a Chicago Walmart, it means “….Working full-time, but not being able to pay back my student loans.”
What does the Walmart economy of inequality mean to you? Is it struggling to pay your bills or drowning in debt? Is it forgoing health care because you can’t afford health insurance or being unable to retire?
Use the hashtag #Walmarteconomy to tweet or post a photo or video to Instagram to say what the Walmart economy means to you. You also can go to the new Walmart Economy website and share your story.
Reposted from AFL-CIO NOW
Tags: Corporate Accountability, economy, Jobs, minimum wage, Walmart
At The Huffington Post, Alissa Scheller has an article that includes nine charts that show very clearly the key takeaways from the AFL-CIO’s recent Death on the Job report. These charts explore the issue of who the 4,600 who die on the job each year are and what is contributing to their deaths.
Reposted from AFL-CIO NOW
Tags: Corporate Accountability, North Dakota, occupational safety and health, OSHA, Rights At Work, workplace safety
For the fourth straight year, the median CEO pay package increased in 2013, crossing $10 million.
Propelled by a soaring stock market, the median pay package for a CEO rose above eight figures for the first time last year. The head of a typical large public company earned a record $10.5 million, an increase of 8.8 percent from $9.6 million in 2012, according to an Associated Press/Equilar pay study.
As the Associated Press reports, the median CEO makes 257 times as much as the average worker, up from 181 times as much in 2009.
In the 1980’s, the average CEO made roughly 42 times as much as the average worker. In the boom times of the 1950’s, they made about 21 times as much.
From 2012 to 2013, as median CEO pay rose 8.8 percent, the value of the minimum wage actually fell roughly 1.6 percent. The value of the minimum wage has fallen every year since 2009.
The Dodd-Frank Wall Street reform law passed in 2010 contained provisions requiring companies to be transparent about the ratio between CEO and average worker pay. But thanks to aggressive lobbying, the SEC has been slow to issue rules.
As of today, nearly four years after the law passed, the SEC has still not finalized the rule on CEO-to-worker pay ratio disclosure.
Photo by kentwang on Flickr
Tags: CEO Pay, Corporate Accountability, income inequality, inequality, minimum wage
Pennsylvania Governor Tom Corbett (R) will not appeal the Commonwealth Court’s recent decision to strike down the so-called voter ID law.
Gov. Tom Corbett put another nail in the coffin of Pennsylvania’s voter identification law on Thursday, announcing he would not appeal a judge’s decision that the law violated the fundamental right to vote.
The Republican governor issued a statement that defended the law, but he also said it needed changes and that he hoped to work with the Legislature on them.
We’ve written frequently about the voter ID law in Pennsylvania, which contained some of the most restrictive voting restrictions in the country. As many as 750,000 Pennsylvania residents lacked the ID required by the law, many of them seniors minorities, students, and low-income workers.
The law passed in March 2012 mirrored other “voter ID” bills introduced in state legislatures nationwide, all of them based on ALEC model legislation. Prominent ALEC member State Rep. Daryl Metcalfe (R-Butler) was one of the laws main boosters in Harrisburg.
The state spent about $7 million trying to enforce the law, while at the same time making huge cuts to education and public services.
“That’s money that could have been spent elsewhere. It’s money that could have gone to schools,” said Philadelphia City Commissioner Stephanie Singer, “It’s money that could have gone to real voter education and that’s really a shame.”
According to MSNBC, Gov. Corbett “raised the idea” of fixing the voter ID law through the legislature, but “suggested it wasn’t a priority.
In 2012, Working America members made educating their communities about the potential new voting restrictions a top priority. Through canvassing, radio, social media, and simple conversations with friends and family, we educated an estimated 425,000 Pennsylvanians before the law was enjoined. The effort was chronicled in detail by Voting Rights News.
If Gov. Corbett is defeated this November, it may be a very long time before we see voter ID in the Keystone State.
Photo by @abc27news on Twitter
Tags: ALEC, Corporate Accountability, Daryl Metcalfe, Pennsylvania, Tom Corbett, voter id, voting rights
Sen. Elizabeth Warren (D-Mass.) introduced a bill today to allow borrowers to refinance their outstanding student loan debt. The Bank on Students Emergency Loan Refinancing Act is an excellent step toward easing the crushing $1.2 trillion student loan debt borne by graduates and reducing barriers to higher education for working families. Average college seniors in 2012 had a balance of $30,000 facing them as they graduated. Many borrowers find themselves making payments well after the end of the standard 10-year repayment period.
Unlike most forms of debt, student loans cannot be refinanced; the borrower is locked into an interest rate from the day he or she signs the promissory note—usually as a teenager—until the debt is paid in full. And unlike most forms of debt, borrowers are unable to take advantage of lower interest rates to reduce their monthly payments and total amount of interest paid.
The question we should be asking is why the government works so hard to carefully regulate growth with variable interest rates while allowing this massive pool of government-backed loans to remain at a fixed rate, trapping millions of workers in debt and unable to buy homes and cars?
Here’s one answer: The government is profiting from the federal student loan program. It’s raking in billions of dollars every year. The Congressional Budget Office estimates that by 2025, $127 billion in profit will be made off the backs of working families paying interest on student loans. In fact, some Republican members in the House have proposed student loan revenues be used to pay down the deficit. It shouldn’t come as a surprise that those same politicians lobbied successfully to tie student loans to market rates (which will make students loans more difficult to pay off as the economy improves). And these are the same politicians who fight to preserve massive corporate tax subsidies that make it more profitable for companies to send jobs overseas. Simply put, they are using the debt peonage of students to pay for billion-dollar corporate giveaways.
Corporations don’t need help from America’s taxpayers to boost their record profits. Fittingly, the Warren refinance bill addresses a major part of the tax giveaway to the wealthy and powerful by implementing the “Buffett Rule” to pay for the reduced profits. Under the Buffett Rule, many of the tax loopholes that let millionaire and billionaire CEOs reduce their taxes to almost nothing would be closed, requiring them to pay tax rates at least as high as their secretaries.
For student loan borrowers, though, it’s a different story. Unemployment, especially for young workers, remains unacceptably high at 10.6% for 20- to 24-year-olds. Wages are stagnant—and for young workers, wages are falling in relation to the rest of the population. Our struggling economy is producing mostly low-paying service-sector jobs that offer no room for growth. In fact, 42% of those earning the minimum wage have some college education, and 8% hold a bachelor’s degree or higher.
Congress’ decision to favor corporations over students is appalling. The Warren refinancing bill helps to undo some of the damage this decision has done to students and working families. Allowing borrowers to refinance their student loans puts them one step closer toward achieving the American Dream: They’ll be able to put a down payment on a home, fund their retirement and fund their own children’s education.
Along with increased funding on instruction and student services in order to lower the actual cost for public two- and four-year colleges and technical schools, the Warren refinance bill is a terrific step toward a comprehensive policy to make post-secondary education and training available to those who want it.
Reposted from AFL-CIO NOW
Tags: Buffett Rule, Corporate Accountability, Elizabeth Warren, Student Debt, student loans, unemployment, young workers
Privatization of services has long been a favorite “solution” of right-wing extremists looking to profit off of taxpayer funds. In attempts to sell the government service provision to private companies, many promises are made about the cost-effectiveness and superior quality product that can be offered by the private sector. But most of those promised benefits fail to materialize. Here are 10 lessons that government officials should learn before considering the privatization of services based on the experience of Chicago’s privatized parking meters (and other examples), as outlined in a recent Atlantic article:
1. It could cost you more than you think: Chicago residents saw parking meter rates rise as much as fourfold after meters were leased to a private company.
2. Things that worked before might stop working right: New electronic meters were installed in Chicago, but many of them didn’t give receipts or failed to work.
3. You could lose current benefits: Free parking on Sundays in the city was eliminated.
4. Constituents could get really upset: Once the parking meter system in Chicago began experiencing problems, the people began having protests and threatened a boycott of the lease.
5. You may not be able to change things back: The lease for the Chicago parking meters was 75 years long in exchange for $1.2 billion in up front revenue. Getting out of that lease could be very costly.
6. Revenue could be depressed: An inspector general found that the city of Chicago should’ve gotten nearly $1 billion more than it did from the private company.
7. Even if things get better, costs could go up: Hidden clauses in the Chicago contract require the city to reimburse the company for lost revenue, and the city was on the hook for a host of other costs, including construction, distribution of parking permits for people with disabilities and other possibilities.
8. Lowered costs could mean undercutting public workers: John D. Donahue, a privatization expert at the Kennedy School of Government at Harvard, says that cost savings are often achieved by undercutting public-sector wages and pensions.
9. Private companies often don’t take into account the same moral arguments that government does: Privatized prisons are the perfect example here, where the profit motive drives companies to demand that governments lock more citizens up.
10. Oversight, accountability and transparency are weakened or eliminated: While government activity is covered by laws that open up much of what an agency does to public scrutiny, most privatization contracts don’t include such measures and it becomes more difficult to know what companies are doing with taxpayer money and hold them accountable when they fail to produce adequate results.
Tags: Chicago, Corporate Accountability, Illinois, privatization
Bob Casey, senior senator from Pennsylvania, is urging Governor Tom Corbett to end his attempts to enact that state’s controversial voter suppression law.
“At every turn Pennsylvania’s Voter ID law has been rejected by the courts,” Casey wrote to Corbett’s office, “Continuing this appeal will only continue to cast a cloud of uncertainty over residents who are rightly concerned that this law will prevent them from exercising their right to vote.”
The letter comes three days after a Commonwealth Court judge denied the Corbett administration’s request to reconsider their January decision that struck down the law.
The Pennsylvania law, based on an ALEC model bill and championed by ALEC member legislators like Rep. Daryl Metcalfe, required that voters must show specific kinds of photo identification to cast a ballot. The legislature passed the bill in March 2012 knowing that 750,000 Pennsylvanians, many of them seniors, minorities, and low-income workers, did not have this type of ID.
While Gov. Corbett and his allies in the legislature pushed enormous cuts to education and public services, the state spent $7 million in a bungled, widely mocked attempt to enact the new voting restrictions.
After the law passed in March 2012, Working America members and organizers were able to reach estimated 642,000 Pennsylvanians with information about what they would need to vote. This year, our members are mobilizing in North Carolina to educate their community about that state’s new stringent voting restrictions; which, not coincidentally, is also based on an ALEC model and promoted by ALEC member legislators.
We don’t yet know if the Corbett administration will appeal the ruling and take the case to the Pennsylvania Supreme Court. But we hope he decides instead to follow the advice of Sen. Casey and thousands of others who want the governor to focus on creating more jobs, not fewer voting rights.
Photo by Senator Robert P. Casey, Jr. on Facebook
Tags: ALEC, Bob Casey, Corporate Accountability, North Carolina, Pennsylvania, Tom Corbett, voting rights
On April 29, 2014, restrictive voting laws in both Wisconsin and Pennsylvania were dealt major blows.
In Wisconsin, the voter ID law passed in 2011 and backed by Gov. Scott Walker was struck down by a federal judge. U.S. District Judge Lynn Adelman wrote that the law placed unfair burdens on poor and minority voters, as well as the nearly 300,000 Wisconsinites who currently lack ID. The law has not been enforced since a state judge ruled it unconstitutional in March 2012.
While attending the Time 100 gala in New York City, Gov. Walker told reporters: “We ultimately think that just like many other issues in the last several years that it will ultimately be upheld.” Wisconsin Attorney General J.B. Van Hollen Plans to appeal.
Over in Pennsylvania, Commonwealth Court Judge Bernard L. McGinley denied the request of Gov. Tom Corbett’s administration to reconsider his ruling that overturned that state’s voter ID law. McGinley struck down the law in January, finding that it put an unreasonable burden on the nearly 750,000 Pennsylvanians who lack photo identification.
The judge “also entered a permanent injunction,” said Pennsylvania ACLU legal director Vic Walczak, “which means the voter ID law cannot be enforced unless and until the [state] Supreme Court takes some kind of action.” The Corbett administration has not yet said whether they plan to appeal.
Those decisions come on the heels of a similar situation in Arkansas, where a judge declared that state’s voter ID law “void and unenforceable.”
These laws were part of a nationwide push for restrictive voting laws after the 2010 elections, backed by the power of the American Legislative Exchange Council (ALEC).
The Pennsylvania and Wisconsin voter ID laws were both based on ALEC model legislation and pushed by ALEC-affiliated legislators. According to NBC News, lawmakers proposed 62 photo ID bills in 37 states in the 2011 and 2012 sessions alone, and that “more than half of the 62 bills were sponsored by members or conference attendees” of ALEC.
The Pennsylvania law was championed by prominent ALEC member Rep. Daryl Metcalfe, who used taxpayer money to attend ALEC conferences.
So what’s next? Egregious voting restrictions are still on the books across the country, particularly in North Carolina. Working America members in NC have made it their primary focus to educate their communities about the law.
But as the New York Times editorial board put it, Wisconsin’s Judge Adelman has “paved the path” for similar laws across the country to be confronted by the court system.
Photo by vox_efx on Flickr
Tags: ALEC, arkansas, Corporate Accountability, Daryl Metcalfe, Pennsylvania, Scott Walker, Tom Corbett, voting rights, Wisconsin
Thom Tillis, Speaker of the North Carolina House and front runner for the Republican nomination for U.S. Senate, has deep ties to ALEC, the American Legislative Exchange Council. In the heated primary leading up to the May 6 election, those connections are paying off.
Since he took the role of Speaker in 2013, Tillis has helped pass a raft of corporate-friendly legislation. Many of these bills were based on ALEC models:
In 2013, after Republicans gained control of the North Carolina legislature and governor’s mansion for the first time since 1870, an array of right-wing legislation reflecting ALEC templates swept through the legislature. Both the Raleigh News-Observer and CMD found dozens of ALEC bills introduced in 2013, including measures that promote voter suppression, union busting, public funding of private schools, and the repeal of clean energy laws.
The onslaught of ALEC-influenced legislation in 2013 helped give rise to North Carolina’s “Moral Mondays” movement.
Tillis himself is not only an ALEC member legislator. He’s a member of the ALEC board of directors, a former member of ALEC’s International Relations Task Force, and received ALEC’s “Legislator of the Year” award in 2011.
Americans for Prosperity (AFP), the group founded and funded by billionaire David Koch, has already spent a whopping $7 million on TV ads attacking Democratic incumbent Kay Hagan. AFP’s ties to ALEC run deep:
AFP has long been a member of ALEC, and both David and Charles Koch have made personal loans to ALEC and funded the group through their foundations. Additionally, a Koch Industries lobbyist sits on the national board of ALEC — along with Tillis.
Art Pope, a North Carolina mega-donor who funds two state-based right-wing think tanks (both of which have been members of ALEC) also reportedly is supporting Tillis’ candidacy. Not coincidentally, Pope serves on the board of AFP.
As we’ve written before, ALEC disrupts democracy not just because of the policies they promote. By writing corporate friendly bills while also funding and promoting the campaigns of politicians who support those bills, they essentially turn legislators into delivery systems – not public servants. But in supporting Tillis and attacking his would-be opponent to the tune of millions, Pope and the Kochs are showing Tillis’ other legislative colleagues that they could benefit by toeing the ALEC line.
Photo via ncdot on Flickr
Tags: ALEC, Americans for Prosperity, Art Pope, Corporate Accountability, Education, Koch Brothers, moral monday, North Carolina, Thom Tillis, voting rights