Why Aren’t Presidential Candidates Talking About the Federal Reserve?
Why Aren’t Presidential Candidates Talking About the Federal Reserve?
In an election fueled by populist anger and dominated by talk of economic insecurity, why aren’t any of the presidential candidates talking about the Federal Reserve?
After nearly a decade...
In an election fueled by populist anger and dominated by talk of economic insecurity, why aren’t any of the presidential candidates talking about the Federal Reserve?
After nearly a decade of high unemployment, severe racial and gender disparities and wage stagnation, voters are heading to the ballot box in pursuit of a fairer economy with less rampant inequality. In California and New York, low-wage workers are celebrating historic agreements to raise the minimum wage to $15 per hour. And the economy and jobs consistently rank among the top concerns expressed by voters of all political stripes.
One government institution reigns supreme in its ability to influence wages, jobs and overall economic growth, yet leading candidates for president have barely discussed it at all. The Federal Reserve is the most important economic policymaking institution in the country, and it is critical that voters hear how candidates plan to reform and interact with the Fed.
The Fed too often epitomizes the problems with our economy and democracy over which voters are voicing frustration: Commercial banks literally own much of the Fed and are using it to enrich themselves at the expense of the American working and middle class. When Wall Street recklessness crashed the economy in 2008, American families paid the price.
At the time, JP Morgan Chase CEO Jamie Dimon sat on the board of the New York Federal Reserve Bank, which stepped in during the crisis to save Dimon’s firm and so many other banks on the verge of collapse. Although the Fed’s actions helped Wall Street recover, that recovery never translated to Main Street, where jobs and wage growth stagnated.
Commercial banks should not govern the very institution that oversees them. It’s a scandal that continues to threaten the Fed’s credibility. An analysis conducted earlier this year by my parent organization, The Center for Popular Democracy, showed that employees of financial firms continue to hold key posts at regional Federal Reserve banks and that leadership throughout the Federal Reserve System remains overwhelmingly white and male and draws disproportionately from the corporate and financial world.
When the Fed voted in December to raise interest rates for the first time in nearly a decade, the decision was largely driven by regional Bank presidents — the very policymakers who are chosen by corporate and financial interests. In 2015, the Fed filled three vacant regional president position, and all three were filled with individuals with strong ties to Goldman Sachs; next year, 4 of the 5 regional presidents voting on monetary policy will be former Goldman Sachs insiders. Can we trust these blue-chip bankers to address working Americans’ concerns?
Yet despite the enormous power it wields and the glaring problems it continues to exemplify, the Fed has received little attention this election cycle. As noted by Reuters last week, two of the remaining candidates for president, Hillary Clinton and John Kasich, have been mute on what they would do about the central bank. Donald Trump’s sporadic statements about the Fed have been characteristically short on details, prompting former Minneapolis Federal Reserve Bank President Narayana Kocherlakota to call for Clinton, Trump and all presidential candidates to clarify exactly how they plan to oversee the Fed’s management of the economy. Ted Cruz has piped up about the Fed on a few occasions, although his vocal endorsement of “sound money” and other policies that contributed to the Great Depression warrant clarification.
The most detailed Fed reform proposal from a presidential candidate to date was a December New York Times op-ed in which Bernie Sanders wrote that “an institution that was created to serve all Americans has been hijacked by the very bankers it regulates,” and urged vital reforms to the Fed’s governance structure.
On Monday, Dartmouth economist Andy Levin, a 20-year Fed staffer and former senior adviser to Fed Chair Janet Yellen and her predecessor Ben Bernanke, unveiled a bold proposal to reform the Federal Reserve and make it a truly transparent, publicly accountable institution that responds to the needs of working families.
The New York primary provides a perfect opportunity for the remaining presidential candidates to tell us what they think about the Federal Reserve. Candidates in both parties should specify whether they support Levin’s proposals, and if not, articulate their preferred approach for our federal government’s most opaque but essential institution.
As Trump, Cruz and Kasich gear up for a potentially decisive primary, they would do well to respond to the many calls for clarity on the Fed. And on Thursday night, Sanders and Clinton will have the chance to clarify their stances on the Fed when they debate in Brooklyn, just a few miles away from Wall Street and the global financial epicenter that is the New York Federal Reserve Bank.
As New York voters get ready to decide which of the remaining candidates would make the best president, they will be asking themselves which candidate will better handle the economy. The candidates’ positions on the Fed must be part of the equation.
Jordan Haedtler is campaign manager of the Fed Up campaign, which calls on the Federal Reserve to adopt policies that build a strong economy for the American public. Fed Up is an initiative of the Center for Popular Democracy, a nonprofit group that advocates for a pro-worker, pro-immigrant, racial and economic justice agenda.
By Jordan Haedtler
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Locals protest GOP tax plan
Last week, more than 100 disability rights and health care advocates were arrested in Washington D.C. during a civil disobedience protest of the GOP tax plan. Among them were residents of...
Last week, more than 100 disability rights and health care advocates were arrested in Washington D.C. during a civil disobedience protest of the GOP tax plan. Among them were residents of Peterborough and Temple.
Lisa Beaudoin of Temple, the executive director of ABLE New Hampshire, a grassroots organization that advocates for families that include people with disabilities, said that she sees the tax plan as taking firm aim at some of the most vulnerable populations – including people with disabilities.
Read the full article here.
THE $15 QUESTION: Higher minimum helps workers and business
Chicago Tribune - June 5, 2014, by Connie Razza - The Great Recession is over! So say the corporations and the wealthiest among us. For the rest of us, the so-called recovery doesn’t feel like...
Chicago Tribune - June 5, 2014, by Connie Razza - The Great Recession is over! So say the corporations and the wealthiest among us. For the rest of us, the so-called recovery doesn’t feel like much of one at all.
Corporate profits and stock prices have rebounded, but wages have not. Middle-class and low-income workers are still struggling to keep up with the cost of living. Corporate recovery has been fueled by the proliferation of jobs paying low wages.
How can we fix this? Raise the minimum wage.
That’s why Aldermen Proco “Joe” Moreno, Roderick Sawyer and John Arena have introduced an ordinance to raise the minimum wage for Chicago workers to $15 an hour, following a March advisory referendum in a small number of precincts that showed about 86 percent of Chicago voters support such a proposal.
If adopted, the $15 wage would initially apply only to workers at businesses with $50 million or more in annual receipts, and their subsidiaries and franchisees, while workers at smaller businesses would see the wage phased in over a multi-year period.
A new study by the Center for Popular Democracy, where I serve as director of strategic research, shows that the ordinance will increase income for 40 percent of all Chicago workers.
But what about job loss? Big business will say the higher wage will hurt the economy and force layoffs.
Not so.
Our study shows that an additional $1.1 billion would be passed to workers as take-home pay. Almost all of that money will travel through the local economy, generating an additional $616 million in new economic activity and creating 5,350 new jobs.
And there is precedent for these findings elsewhere: The payroll company Paychex and research firm IHS did a survey that found that Washington, the state with the highest minimum wage, also has the highest annual job growth.
Raising the wage isn’t just the right thing to do; it’s the smart thing to do. And although it may seem counterintuitive, the higher wage will help businesses grow. How?
Because too much inequality threatens economic growth and stability by limiting consumers’ ability to buy goods and participate in the marketplace. In other words, who will buy a new car if no one can afford to pay rent?
Unfortunately, the so-called recovery we’re in has been fueled largely by low-wage jobs replacing previously existing higher-wage jobs, further fueling inequality. In 2012, the Brookings Institute named Chicago the eighth most unequal city in the country.
Latinos and African-Americans make up disproportionate portions of the low-wage workforce, exacerbating racial and geographic disparities in the economy. Our study shows that a higher minimum wage will address these disparities by helping low-wage workers to participate more fully in the city’s economy as consumers, and help facilitate economic recovery in the neighborhoods where these workers live.
The current Illinois minimum wage is $8.25 an hour, a dollar higher than the federal minimum wage. Neither of these wage levels has kept pace with inflation or the cost of living, and both fall well below in purchasing power compared to the minimum wage in previous decades.
While the state and the federal government continue to ponder action, Chicago can’t afford to wait. The city is well positioned to take action, and join other cities, such as Seattle, San Francisco, and Washington, that are showing national leadership for urban America while Congress continues to stall.
More families than ever are relying on low-wage jobs to make ends meet. Let’s give them a fighting chance. Let’s make the economy work for all of us, not just the wealthy and the corporations.
Connie M. Razza is the director of strategic research at the Center for Popular Democracy, which gets funding from private philanthropy, community groups and labor organizations.
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The big 2016 minimum wage push just got a powerful new ally
A little over a year out from the presidential election, we already know the states where the fiercest battles will likely be fought. But another electoral map is shaping up too: The states where...
A little over a year out from the presidential election, we already know the states where the fiercest battles will likely be fought. But another electoral map is shaping up too: The states where voters will decide where to raise their minimum wage.
And soon, those pay-boosting ballot measures might have some serious money behind them. A large California union is seed funding an organization aimed at accelerating such campaigns around the country, seizing on growing public support for raising the minimum wage to heights that just one cycle ago would have seemed like total fantasy.
It’s called the Fairness Project, officially launching Thursday, and it’s already focusing on three jurisdictions: California, Maine and the District of Columbia, with potentially more to come as funding becomes available. And the group's main backer, the Service Employees International Union’s 80,000-person strong United Healthcare Workers local in California, says it’s talking with a handful more.
“This is the best value in American politics,” says SEIU-UHW president Dave Regan, who last year laid out a strategy to raise wages through ballot initiatives in the 24 states that allow them. “If you can amass $25 million, you can put a question in front of half the country that simply can’t be moved through legislatures because of big money in politics.”
The organization doesn’t have $25 million yet, just a couple million; Regan declined to specify exactly how much. SEIU headquarters, despite waging its own multi-million dollar “Fight for $15” campaign to raise wages around the country, has yet to pitch in (which may have something to do with the fact that Regan has had a testy relationship with SEIU’s president, Mary Kay Henry; SEIU declined to comment).
But Regan says he hopes that as union locals do their budgets for the 2016 campaigns, they’ll contribute, partly as a way to resuscitate the labor movement’s image. “Most of the discourse around unions is negative,” Regan says. "So the Fairness Project is saying, 'Look, we can win for tens of millions of people, just if we’re committed to doing this.'"
They’ve picked a soft target. According to the Ballot Initiative Strategy Center, minimum wage measures have been tried 20 times in 16 states since 1996, and all but two succeeded. The earlier victories came in waves, starting with the “living wage” movement in the 1990s. The campaigns even work in conservative states: in 2004, John Kerry lost Florida, but a minimum wage hike passed with 70 percent of the vote.
Even though those measures may not have made it through state legislatures, in combination, they do seem to add momentum for minimum wage hikes on the federal level — Congress responded with legislation in 1997 after a spate of ballot initiatives, and again in 2007 and 2008. Sometimes, just the credible threat of a ballot initiative can spur state houses to action where previously they had no interest, although the final result may end up watered down.
Most recently, in 2014, minimum wage measures passed in Arkansas, Alaska, Nebraska, and South Dakota. This latest wave is even more ambitious than the first and second, says Brian Kettenring, co-executive director of the Center for Popular Democracy — and it benefits from the narrative around inequality that arose during an economic recovery that delivered very little wage growth.
"In some ways the most powerful, because it’s the most visionary in terms of the Fight for $15,” Kettenring says. “What the project hits on that really makes sense is engaging inequality through the ballot initiative.”
Still, there’s no guarantee of success, and credible initiative campaigns do take money. They also have a lot of common needs, like polling, voter targeting, Website design, and message strategy. That’s where Ryan Johnson, the Fairness Project’s executive director, says the group can help.
“There are a lot of very expensive things with ballot initiatives,” Johnson says. “Things that work with presidential campaigns — could we take the lead in investing in those directly and at scale? It saves people a couple grand here, and couple grand there.”
It’s a model that’s worked for other causes, as well, such as marriage equality and medical marijuana. The ballot initiative process has long been used by both conservative and liberal groups, with varying degrees of scale, sometimes with the side effect of driving turnout for Democratic or Republican candidates.
The support will help campaigns that usually lack major corporate financing, and have to sustain themselves with volunteers and small dollar donations. Amy Halsted, of the Maine Peoples’ Alliance, says the organization received unprecedented financial support for its push to raise the state’s minimum wage to $12 by 2020 — it has raised about $150,000.
But it could use help with big-ticket items that are more efficiently provided by a central coordinating body, like consulting and tech support. And besides, a national campaign has a galvanizing effect in itself.
“One of the things we’re excited about is their ability to sustain that energy that exists nationally, and try to create an echo chamber,” she says. "The ability to connect all the movements I think is powerful and exciting, and makes our hundreds of volunteers feel connected to a big national campaign.”
The Fairness Project may not even be the only game in town when it comes to national support for minimum wage campaigns. Seattle billionaire Nick Hanauer, who helped bankroll the successful $15 an hour campaign there, isn’t contributing — he thinks the group has got the wrong message. “The majority of workers want the economy to grow,” he wrote in an e-mail, arguing that high wages are good for business. “Growth sells. Complaining about fairness does not.” (Regan says their initial focus groups responded well to the fairness message.)
But Hanauer may be supporting other campaigns independently — including a ballot initiative in his home state of Washington. “We hope to influence the messaging on a lot of the campaigns that will unfold in ’15 and ’16,” he says.
Ballots will likely becrowded with other measures, too — with more and more state legislatures controlled by Republicans, liberal groups are trying to put gun control and marijuana legalization questions before voters directly.
Facing that popular onslaught, the business community is weighing its options.
In some places, like Maine, the opposition might not be that fierce. Although business groups grumbled when the $12 statewide ballot initiative was introduced, the state’s biggest city — Portland — already passed a law that would raise the wage at least that high by 2018. On top of that, they’refighting a city vote on a local $15 minimum.
“$12 is not out of the question here, as long as it's statewide,” said Toby McGrath, who’s running the campaign against the $15 measure for the Portland Chamber of Commerce.
California, however, will see a more pitched battle. Business groups managed to stall a $13 minimum wage hike proposal in the legislature. Tom Scott, California’s state director for the National Federation of Independent Business, says there's still a lot of time yet to build an employer response to the ballot measure that labor backers say just got enough signatures to qualify.
“There’s going to be a huge coalition opposition a minimum wage increase,” he says. “This is a very long process. And the one thing about ballot initiatives — depending on how it’s worded, if it’s a yes or a no, in California, if I can in 15 seconds create confusion or questions, people will typically vote no.”
But if young people vote in large numbers, Scott worries they could be hard to beat. “I would just be fearful of the voter turnout,” he says, "and the demographics of who’s turning out.”
After publication, SEIU headquarters reached out to add the following statement:
SEIU works directly with our local unions in states to evaluate ballot initiatives on a state by state basis and determine which ones will advance better jobs and better wages for working people.
Source: Washington Post
Accountability of Charter Schools in Illinois Raises Questions
WTAX News Radio - February 2, 2015 - Charter schools in Illinois are in the cross hairs of a new report alleging a lack of accountability leading to between $13 million and $27 million in fraud....
WTAX News Radio - February 2, 2015 - Charter schools in Illinois are in the cross hairs of a new report alleging a lack of accountability leading to between $13 million and $27 million in fraud.“At a time when (Chicago Public Schools are) crying broke, and public schools are grossly under-resourced, and there’s a public demand for transparency and accountability around every corner,” says Action Now executive director Katelyn Johnson, “it seems unconscionable that CPS and the state of Illinois would not invest in rigid financial oversight of charter schools.”Johnson’s group is supporting the Center for Popular Democracy in the report, “Risking Public Money.”Andrew Broy has a differing viewpoint. He’s the president of the Illinois Network of Charter Schools and dismisses the other two groups as union-funded and anti-charter to begin with.“The question” about accountability, he says, “is if there are challenges with an internal governing board, how do we uncover that and make sure it’s taken care of, and the current law equips districts with all the tools they need to make sure that happens.”Source
New Toolkit Puts Municipal ID Within Reach of Legislators Across Country
New Toolkit Puts Municipal ID Within Reach of Legislators Across Country
Today, Center for Popular Democracy is releasing a new guide to setting up municipal ID Building...
Today, Center for Popular Democracy is releasing a new guide to setting up municipal ID Building Identity: A Toolkit for Designing and Implementing a Successful Municipal ID Program, to take the fight for immigrant dignity to cities across the country.
Municipal IDs allow all residents, regardless of immigration status, gender identity, or other characteristics, to open a bank account or cash a check, see a doctor at a hospital, register their child for school, apply for public benefits, file a complaint with the police department, borrow a book from a library, vote in an election, or even collect a package from the post office. Municipal ID removes all of these barriers with a single stroke.
To mark the release of the toolkit, immigrant New Yorkers who have benefited from the municipal ID program will gather on the front steps of City Hall, NYC, at 11am to call for other cities across the country to adopt similar programs.
In addition to New York City, grassroots organization have successfully passed municipal ID programs in major cities like Newark and Hartford, improving the lives of immigrant communities and underserved populations. Center for Popular Democracy’s new toolkit will help like-minded leaders in other parts of the country create similar programs.
Ana Maria Archila, co-executive director of Center for Popular Democracy, stated: “In each city we pass municipal ID, the immediate outpouring of immigrant families eager to cement their status as members of communities is heartening. Immigrants’ history and contributions make them central parts of our communities across the country. This toolkit symbolizes the effort, partnerships, and strong bonds that will take the fight for immigrant justice to the next level in cities across the country.”
Ruth Pacheco, Make the Road New York member and Queens resident, who has two school-age children, said: “My municipal ID has opened many important doors for me, whether at my children’s school, the bank, or the library. Before, when I had to meet with my children’s teachers, they wouldn’t let me in without ID. Now the IDNYC solves that problem. Before, to open a bank account or present myself at the bank, I had to bring my passport, which was risky. Now the IDNYC solves that problem.”
“The municipal identification program—now IDNYC—is a hallmark of our City and a testament to how robustly we want to engage with New Yorkers of all experiences. This program, as we anticipated, has been particularly helpful to those who have a historic disconnect with governments of all levels. For those people, this municipal identification ogram has changed the game. The level at which people are engaging with government, and with one another in their communities is something that should be modeled and I am heartened that now, with this announcement from the Center for Popular Democracy, other cities will be able to do just that,” said Council Member Carlos Menchaca.
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www.populardemocracy.org
The Center for Popular Democracy promotes equity, opportunity, and a dynamic democracy in partnership with innovative base-building organizations, organizing networks and alliances, and progressive unions across the country. CPD builds the strength and capacity of democratic organizations to envision and advance a pro-worker, pro-immigrant, racial justice agenda.
Fed Up Coalition Complains About Jackson Hole Room Cancellations
Fed Up Coalition Complains About Jackson Hole Room Cancellations
A group of activists planning to attend the Federal Reserve Bank of Kansas City’s annual economic symposium in Jackson Hole, Wyo., has filed a complaint with the National Park Service, the...
A group of activists planning to attend the Federal Reserve Bank of Kansas City’s annual economic symposium in Jackson Hole, Wyo., has filed a complaint with the National Park Service, the Department of the Interior’s Inspector General’s Office and the Justice Department after the conference hotel canceled the group’s room reservations.
The Center for Popular Democracy’s Fed Up Coalition said in an Aug. 9 letter that it booked 13 rooms in May at the Jackson Lake Lodge for its members for the nights of Aug. 24, 25 and 26. Last month, the lodge informed the group that their reservations had been canceled because of a “computer glitch,” according to the letter.
But the lodge didn’t cancel the reservations for other guests who booked after Fed Up did, said the letter written by Ady Barkan, campaign director of Fed Up, a left-leaning group that has lobbied for more diversity among Fed officials and more openness about the selection of regional Fed bank presidents.
“It is very hard for me to interpret the Company’s actions as anything other than a specific targeting of the Fed Up coalition,” he wrote in the letter.
Mr. Barkan said the group booked rooms at other hotels farther away from the conference, which will make it difficult for activists to attend events.
The Jackson Hole conference draws central-bank officials and economists from around the world who gather near the Grand Tetons to discuss monetary policy.
Fed Up members have been attending the conference for the past two years to urge Fed officials to hold off on raising interest rates, arguing that higher borrowing costs will slow economic growth and hurt low-income households. The group’s members often hold events and rallies near Fed events, wearing their signature green T-shirts.
A spokesperson for the Jackson Lake Lodge didn’t return a call for comment. Kathy Kupper, a spokeswoman for the National Parks Service said the lodges are run by independent contractors who are responsible for their day-to-day operations.
Mr. Barkan said he was writing the letter “to file a formal complaint regarding improper and potentially illegal behavior,” by the company.
By David Harrison
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Protesters disrupt Senate hearing on health care bill that may be dead
Protesters disrupt Senate hearing on health care bill that may be dead
WASHINGTON — The Republican bill to replace Obamacare appears all but dead in the Senate, but the chamber’s Finance Committee proceeded with a hearing on it anyway Monday afternoon.
Finance...
WASHINGTON — The Republican bill to replace Obamacare appears all but dead in the Senate, but the chamber’s Finance Committee proceeded with a hearing on it anyway Monday afternoon.
Finance Chairman Orrin Hatch asked by a reporter what chance the bill has of passing, replied “Zero. ... I don’t think it has much chance. The Democrats aren’t going to support it. They’re too interested in demagoguing it.”
Read the full article here.
Occupy the Minimum Wage: Will Young People Restore the Strength of Unions?
The Guardian - January 26, 2014, by Rose Hackman - Alicia White, 25, defied the odds of a poor background by attending college on a partial scholarship and going to graduate school. While she...
The Guardian - January 26, 2014, by Rose Hackman - Alicia White, 25, defied the odds of a poor background by attending college on a partial scholarship and going to graduate school. While she spends her days applying for jobs, the only work she has found so far is face-painting at children’s birthday parties.
“By going to college and graduate school, I thought I was insulating myself from being broke and sleeping on friends’ couches and being hungry again. The big, scary part is that I am going to end up where I was, but now I am going to be in that awful situation with $50,000 of debt,” White says.
White’s story is no exception. One in two college graduates are now either unemployed or underemployed. Millennials – even those from the middle class – are experiencing income inequality and America’s failed dream of upward mobility first-hand. The mismatch of college-educated young workers with low-wage, unskilled, precarious jobs is creating a new face of the once-dwindling American labor movement: young, diverse, led by millennials in their twenties and thirties, and fighting what they see as an unfair labor market. Their modest cause? Pushing for a higher minimum wage.
Because of too many young people interested looking for work, these millennials reason that the labor movement is the only way to address large-scale poverty and income inequality – starting with their own.
The "Fight for 15" movement is the most visible of these. Designed by the SEIU to raise the minimum wage from $7.25 an hour to $15 an hour, the effort has been driven by young activists. Last fall, the movement claimed its first legislative victory with residents in SeaTac, Seattle’s airport carrying suburb, voting to raise its minimum wage to $15 an hour.
“There’s more enthusiasm than there has been probably in our lifetime for this,” says Ady Barkan, a 30-year-old Yale Law graduate and staff attorney at the Center for Popular Democracy in New York, indicating that the "Fight for 15" movement is picking up where Occupy Wall Street left off. He calls it “part of a similar cultural moment”.
It doesn't hurt the movement that the difference in pay between unionized and non-union jobs is pronounced. The median weekly earnings of union members in 2012 was $943, compared to $742 for those not in a union, the Bureau of Labor Statistics said in its recently released annual survey of labor.
“The dismal prospects for young workers are underscoring the fact that you can’t rebuild an economy on low-wage jobs and that inequality has reached a point where it really is an existential crisis for America,” says Annette Bernhardt, UC Berkeley's visiting sociology professor, whose work has focused on the low-wage economy and inequality.
Demographically, even the modest interest millennials have shown in the labor movement recently is a reversal of decades of disinterest. Unions have been ageing out of the economy along with their members, with nearly one in six union members aged 55-64, according to the BLS. Amid other trends – offshoring, automation, the growth of a service-centered economy – the share of national income that comes from labor unionshas been steadily falling since the 1970s. Union membership is at its lowest point in recent memory, with only 11.3% of Americans in unions. Critics, including the Center for American Progress blame those trends for the decline of the middle class.
Membership in unions is low for millennials – with only 11% of union members falling in the 25-34 age group, compared to 16% for workers between 55-64 – but their political views tend to align with the labor movement. A Pew poll this June showed 61% of Americans 18-24 in favor of unions, with strongest support coming from women and minority groups.
Diversity is more evident in the newer labor movement among millennials, reflecting the dominance of black and hispanic workers in unions nationally.
Jose Lopez, 27, is an organizer who works with Make the Road New York, mobilizing fast food and car wash workers. His previous work within the same organization involved pairing up young community members and artists with local businesses to paint storefronts, raising awareness about police brutality and stop-and-frisk. Lopez plans on bringing the same type of creativity to mobilize people around issues of inadequate income and wage theft, he said.
Protestor Janah Bailey, 21, of Chicago, currently works two fast food jobs: one full-time at Wendy’s, which she says pays $8.25 an hour, and one part-time at McDonald’s, which pays $8.40. On one day last year, Bailey walked out on both jobs for strikes against low pay. She says $15 an hour would change her life “tremendously”, expecting she would only have to work one job to make ends meet and help support her family, and spend her newly acquired spare time on studying to open up her own business.
The persistence of low wages is also mobilizing millennials who have never known a healthy job market. David Meni, 20, says he has held down a plethora of unpaid positions, internships and temporary jobs since his sophomore year of high school. His George Washington University chapter of the Roosevelt Institute’s Campus Network recently joined other local organizations in successfully pressuring the Washington DC city council to vote for an increase in the minimum wage to $11.50 an hour by 2016 from its current level of $8.50 an hour – despite the opposition of large corporations including Walmart.
That is not to say that young people will revolutionize the labor movement immediately. Millennials have an uphill battle in turning around the decline of labor. Studies show that while millennials support unions, until now, they have rarely joined them, perhaps in the belief that their low-paying jobs were temporary.
That perception may be changing as it becomes evident that lower wages are likely to be the norm for a long time.
Many economists predict that low wages are likely to continue into 2014, as pressure continues from corporate executives eager to return profits to their shareholders – namely by keeping a lid on expenses like pay. In a research report this week, influential economist Jan Hatzius of Goldman Sachs directly ties the 6.5% rise of corporate profits to the nearly inert 2% growth of US wages.
"The bottom line is that the favorable environment for corporate profits should persist for some time yet, and the case for an acceleration in the near term is strong," Hatzius wrote. "Eventually, the pendulum will swing back in the direction of lower profit margins and higher wages, but this still looks fairly distant."
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Zara Latest ‘Cool’ Retailer in Hot Water for Alleged Discrimination
Spanish fashion chain Zara is among several “hip” retailers making headlines recently for alleged discrimination against employees.
Ian Miller, a former attorney for the mega-...
Spanish fashion chain Zara is among several “hip” retailers making headlines recently for alleged discrimination against employees.
Ian Miller, a former attorney for the mega-retailer, claims he was harassed and discriminated against for being Jewish and gay. In his $40 million lawsuit against the company, which is owned by Inditex SA, Miller alleges that he was excluded from meetings, given smaller raises than other employees and subjected to discriminatory remarks.
In addition, the Center for Popular Democracy released a survey of New York–based Zara employees, titled “Stitched with Prejudice: Zara USA’s Corporate Culture of Favoritism.” The report found that black employees are more dissatisfied with their hours than white employees, are reviewed more harshly by management and are least likely to be promoted.
When it comes to people who shop at Zara, black customers are seven times more likely to be targeted as potential thieves than white customers, the report found.
A spokesperson for Inditex refuted the claims in the Center for Popular Democracy report in a statement to FOXBusiness.com.
“It fails to follow an acceptable methodology for the conduct of a credible objective survey on workplace practices, and instead appears to have taken an approach to achieve a pre-determined result which was to discredit Zara. Zara USA believes that the claims made in the report are completely inconsistent with the company’s true culture and the experiences of the over 1,100 Zara employees in New York City and over 3,500 in all the US,” said the spokesperson.
Perhaps even more high profile is a discrimination case involving Abercrombie & Fitch (ANF), which made its way to the Supreme Court. The preppy retailer known for its presence in American malls was sued by Samantha Elauf, a young Muslim woman who wore a headscarf to a job interview at the company seven years ago.
“Ms. Elauf never informed Abercrombie before its hiring decision that she wore her head scarf, or ‘hijab,’ for religious reasons,” the ruling stated.
The Supreme Court recently overturned that decision.
A spokesperson for Abercrombie & Fitch told FOXBusiness.com in a statement that although the Tenth Circuit decision was overturned by the Supreme Court, it was not determined that the company discriminated against Elauf.
“We will determine our next steps in the litigation, which the Supreme Court remanded for further consideration. A&F remains focused on ensuring the company has an open-minded and tolerant workplace environment for all current and future store associates. We have made significant enhancements to our store associate policies, including the replacement of the 'look policy' with a new dress code that allows associates to be more individualistic; changed our hiring practices to not consider attractiveness; and changed store associates' titles from 'Model' to 'Brand Representative' to align with their new customer focus. This case relates to events occurring in 2008. A&F has a longstanding commitment to diversity and inclusion, and consistent with the law, has granted numerous religious accommodations when requested, including hijabs,” the spokesperson said.
Nasty Gal, a self-described “global online destination for fashion-forward, free-thinking girls,” is being sued for illegally firing Aimee Concepcion and several other employees either before taking or during maternity/paternity leave.
The lawyer for the former employee that filed the suit, who will represent three other female ex-employees in arbitration hearings, said “they were the only pregnant females who provided notice of maternity leave before being terminated, and …their jobs were taken over by other employees.”
"The accusations made in the lawsuits are false, defamatory and taken completely out of context,” a Nasty Gal spokesperson told FOXBusiness.com. “The layoffs in question were part of a larger restructuring of departments we completed over nine months ago. The lawsuits are frivolous and without merit."
When it comes to the likelihood of this case succeeding in court, it is worth looking to similar prior verdicts for perspective.
“Shortly before they filed the Nasty Gal lawsuit, a $7.7 million verdict in favor of a pregnant (at the pertinent time) Price is Right model was affirmed by a California appellate court,” said Jeff Trexler, associate director at Fordham’s Fashion Law Institute.
On the flip side, “If Nasty Gal can show that it actually provided the requisite notices, offered reasonable accommodation to her (Concepcion’s) pregnancy, wasn't motivated to fire her because of her pregnancy, and did not treat pregnant women differently from other employees in similar positions, there's a substantial possibility that the company will prevail,” said Trexler.
Retail stores have also received flack in recent months for selling discriminatory merchandise. Urban Outfitters (URBN) was condemned by organizations including the Human Rights Campaign and the Anti-Defamation League for a gray- and white-striped tapestry imprinted with a pink triangle that was sold at a store in Boulder, Colorado. The groups said the item projected Holocaust imagery, specifically of the uniforms gay men were forced to wear in Nazi concentration camps. Calls for comment to Urban Outfitters were not returned by the time of publication.
Despite the extent of public outcry over the merchandise, Urban Outfitters is technically allowed to sell whatever it wants.
“Designs evocative of Nazi imagery may be offensive, but they're no more illegal than the Confederate flag; ultimately, the decision to stop selling designs with either image comes down to ethical and reputation management concerns,” said Trexler.
In recent weeks, several retailers including Wal-Mart (WMT), Sears (SHLD) and Amazon (AMZN) announced they would stop selling Confederate battle flag merchandise following the mass shooting in June at Emanuel African Methodist Episcopal Church in Charleston, South Carolina.
No stranger to controversy, Zara was also accused of selling discriminatory merchandise. A 2014 white-and-blue striped shirt, which featured a six-pointed star, came under fire for its resemblance to uniforms worn by Jewish prisoners at Nazi concentration camp. The “sheriff shirt” was pulled from the retailer’s site after it issued an apology.
So, is outcry over discrimination becoming more common in the retail industry, or is it simply that intense media scrutiny is making it seem like it is?
“Allegations of discrimination are nothing new in fashion, as with any business, but what's particularly noteworthy now is their potential to have a substantial negative impact on a brand,” said Trexler. “One could say that the way people characterize discrimination is shifting from incident to identity, and in this fashion reflects a broader cultural trend that has emerged alongside advances in communications technology.”
When asked if changes in the law are making discrimination lawsuits easier to file, Trexler said that enforcement has shifted “in ways that arguably encourage people to take legal action.”
Most notably, the U.S. Equal Employment Opportunity Commission has worked to make pregnancy discrimination an enforcement priority, and a Supreme Court decision also raised awareness on the issue.
“Acts that might have gone unchallenged in years past now might be more likely to spark a lawsuit,” said Trexler.
Source: Fox Business
2 months ago
2 months ago