Campaign News

How Pension Plans are at Risk

Melisa Harris-Perry - March 23, 2014 - Lynnette Khalfani-Cox, Connie Razza, Arun Gupta and Karen Friedman takes a closer look at Detroit’s pension funds as the city struggles with bankruptcy and the growing retirement savings crisis nationwide.

  How CEO Pensions Compare to Average Workers' Pensions

Melissa Harris-Perry - March 23, 2014 - According to a recent survey, CEO pensions are worth at least 239 times more than the average employee's 401(k) at ten of the biggest U.S. companies.

 

Why Cities are Watching Detroit

Melissa Harris-Perry - March 23, 2014 - The MHP table discusses if other American cities could be on the same road as Detroit.

 

Proponents of hiking the state’s minimum wage have already collected more than $1.4 million to put the issue on the November ballot and convince voters to support it.

But there’s no word on how much the Arizona Restaurant Association has spent so far trying to keep Proposition 206 from ever getting to voters.

New campaign finance reports due Friday show donations of $1,357,509 to Arizonans for Fair Wages and Health Families, with another $100,000 on loan from campaign consultant Bill Scheel. Most of those dollars — about $900,000 — were spent hiring paid circulators to put the issue on the ballot.

But the secretary of state’s office said Friday it has yet to get a spending report from foes. In fact, spokesman Matt Roberts said foes have not even filed to form a campaign committee, a legal prerequisite for spending any money for or against ballot measures.

There clearly has been some spending.

The restaurant association hired attorneys and filed suit on July 14 in a legal bid, unsuccessful to date, to have the measure removed from the November ballot. And the report due Friday is supposed to cover all expenses through Aug. 18.

Neither Steve Chucri, president of the restaurant group, nor Chiane Hewer, its spokeswoman, returned repeated calls seeking comment.

Roberts said his office has no legal opinion on whether the money spent in court over ballot measures has to be reported. But the legal expenses incurred by initiative supporters are listed, with their report saying the group paid $70,000 to the Torres Law Group to defend them in the lawsuit brought by the restaurant association.

Proposition 206, if approved in November, would immediately hike the state minimum wage from $8.05 an hour now to $10. It would hit $12 an hour by 2020, with future increases linked to inflation.

It also would require companies to provide five days of paid sick leave a year; small employers would have to offer three days.

There is one thing missing, however, from the report by the pro-206 group.

The report shows $998,684 of the donations coming from Living United for Change in Arizona.

But Tomas Robles, former director of LUCHA who is now chairing the campaign, said some of those dollars came from elsewhere. He said the organization has been the beneficiary of funds from groups like the Center for Popular Democracy and the United Food and Commercial Workers union.

Robles said, though, that the way Arizona law has been amended by the Republican-controlled legislature does not require detailing the specific donors or the amounts they gave.

While any spending by the restaurant association to date is unknown, the campaign is likely to be overshadowed, at least financially, by the fight over Proposition 205.

That measure would legalize the recreational use of marijuana by all adults; current law limits use of the drug to those who have certain medical conditions, a doctor’s recommendation and a state-issued ID card.

So far the Campaign to Regulate Marijuana Like Alcohol has amassed more than $3 million in donations.

Of that, $778,950 comes from the Marijuana Policy Project, the national group that funded the successful 2010 campaign for medical marijuana. A separate Marijuana Policy Project Foundation kicked in another $236,572.

Virtually all of the other five- and six-figure donations come from existing medical marijuana dispensaries. Proposition 205 would give them first crack at getting a license for one of the fewer than 150 retail outlets that would be allowed until 2021.

So far the campaign has spent nearly $2.6 million.

The opposition Arizonans for Responsible Drug Policy reported collected $950,011 but has spent less than $294,000.

The Arizona Chamber of Commerce is the largest single source of funds for the anti-205 campaign, so far putting in $114,000.

There’s also a $100,000 donation from T. Sanford Denny. He’s the chairman of United National Corp., which Bloomberg says is a privately owned holding company for First Premier Bank.

Another $100,000 was chipped in by Randy Kendrick, wife of Arizona Diamondbacks owner Ken Kendrick.

The new reports also show that a branch of the Service Employees International Union spent $2.1 million in its ill-fated attempt to put a measure on the ballot to cap the compensation of non-medical hospital executives at $450,000 a year. Proponents gave up after a lawsuit was filed contending that many of the people who circulated petitions had not complied with state law, voiding any of the signatures they collected.

By: Howard Fischer

Source

Ana Maria Archila, co-executive director of the Center for Popular Democracy, welcomed the legislation. “The vast majority of Puerto Rican debt is owned by actors who invested knowing full well that Puerto Rico could not pay,” she said. “There’s no way for Puerto Rico to recover if it has to use public money to pay hedge funds.”

Read the full article here.

Atlanta Black Star - March 4, 2015, by Nick Chiles - The actions of the Federal Reserve have typically been undertaken to benefit banks and the financial services sector collectively known as Wall Street, but a new report by the Center for Popular Democracy reveals that the Fed’s traditional policies substantially contribute to the dire economic conditions of African-Americans across the country.

While there have been many reports showing how badly African-Americans suffered from the Great Recession and how middle and low-income Americans have not benefitted from the so-called economic recovery, which was really just a recovery for Wall Street, this report is one of the first to link the fortunes of specific groups like African-Americans to the actions of the Federal Reserve.

The Federal Reserve, the nation’s central bank, remains a shadowy presence to most rank-and-file Americans, who would hardly think of the Federal Reserve when assigning blame for their financial struggles.

The intentions of the Center for Popular Democracy, with assistance from the Economic Policy Institute, are clear just by reading the name of its report—”Wall Street, Main Street, and Martin Luther King Jr. Boulevard: Why African Americans Must Not Be Left Out of the Federal Reserve’s Full-Employment Mandate.”

In the explanation for the report’s rather trite title, the primary author, Connie M. Razza of the Center for Popular Democracy, said Martin Luther King Jr. Boulevard refers to African-American communities because “hundreds of U.S. cities have streets named for Martin Luther King Jr., often located in persistently lower-income Black neighborhoods.”

The report’s premise is that the Fed’s goal of keeping the national employment rate at about 5.2 percent—which the Fed considers “full employment” because it allows for movement in the job market—is actually devastating to the African-American community. The reason: When the national unemployment rate stays in the vicinity of 5.2 percent, the African-American unemployment rate is typically about 11 percent.

But because the Fed is dominated by the interests of Wall Street, the impact of its policies on Main Street or on African-Americans is not ever truly considered.

“Although the Great Recession officially ended nearly six years ago, the American economy is still far from healthy,” the report states. “Wall Street has had a robust recovery. Large corporations are making record profits. But the labor market remains weak.”

As Razza points out, the policy decisions of the Federal Reserve directly affect Main Street and MLK Blvd. The Fed’s primary job is keeping inflation stable, regulating the financial system, and ensuring full employment. But corporate and finance executives generally want to limit wage growth so that they maximize their future profits.

“But most people in America earn their living from wages, not capital income, and it is in their interest to see full employment whereby wages grow faster than prices in order to lift working and middle-class families’ living standards,” Razza writes.

Typically the Feds resolve this dilemma in favor of Wall Street, by intentionally limiting wage growth and keeping unemployment excessively high.

“The Fed’s policy choices over the past 35 years have led to increased inequality, stagnant or falling wages and an American Dream that is inaccessible to tens of millions of families—particularly Black families,” the report says.

As detailed in the report, the last eight years have been catastrophic for the nation’s African-American community in virtually every financial indicator studied by economists:

* In January 2015, the national African-American unemployment rate was 10.3 percent, more than twice the current white unemployment rate and higher than the 10.0 percent U.S. unemployment rate reached in October 2010, at the height of the recession.

* The contraction in public-sector jobs—which are disproportionately held by Black people and women—has meant that the African-American workforce has been disproportionately impacted by the recession. In 2011, the number of African-Americans who were unemployed and had most recently been employed in state or local government was higher than their share in the decline of state and local government job loss, suggesting that they were disproportionately laid off and faced more barriers to finding work after losing their public-sector jobs, according to the report. The loss of public-sector jobs also has potential implications for wage inequality since African-Americans and women who are employed in public service have historically suffered significantly less wage inequality than their peers in the private sector.

* Wages have been stagnant or falling for the vast majority of workers since 2000, the report states. While at the median, wages for white workers have risen only 2.5 percent in 14 years, African-American workers have seen a wage cut of 3.1 percent over the same period. In fact, in two-thirds of the states for which data are available, the median real wages of African-American workers declined between 2000 and 2014. The fastest declines were in Michigan (down 15.8 percent), Ohio (down 13.7 percent) and South Carolina (down 11.6 percent).

* Between 1989 and 2001—a period of comparatively robust job growth and a tight labor market during the late 1990s—the wealth gap between whites and African-Americans narrowed. In 2001, Black households had roughly 16 percent the wealth of white households, compared with 6 percent in 1989. By 2013, median African-American household wealth was only 8 percent that of whites.

The report states that the wealth disparity began growing during the housing boom, precisely because of the racist practices of American banks. Between 2004 and 2007, at the height of the boom, white household wealth increased 23 percent, while African-American household wealth actually declined by 24 percent.

“The convergence of wage stagnation and banks’ preying on African-American communities with risky mortgage products (which banks backed with overvaluations of collateral property), led to African-American borrowers being more likely to receive subprime loans than white borrowers,” the report says. “These loans were frequently made as second mortgages, drawing down equity that homeowners had built up. Discriminatory subprime lending practices drained wealth from African-American homeowners before the recession and certainly made Black wealth significantly more vulnerable during the housing crisis.”

One of the most telling statistics in the report is the detailing of the jobs that the economy has regained during the recovery. If the public needed a clear indication of why so many people are still struggling though Wall Street is back, here it is:

While lower-wage industries accounted for 22 percent of job losses during the recession, they account for 44 percent of employment growth over the past four years. That means lower-wage industries today employ 1.85 million more workers than at the start of the recession.

Mid-wage industries accounted for 37 percent of job losses, but 26 percent of recent employment growth. There are now 958,000 fewer jobs in mid-wage industries than at the start of the recession.

Higher-wage industries accounted for 41 percent of job losses, but 30 percent of recent employment growth. There are now 976,000 fewer jobs in higher-wage industries than at the start of the recession.

And here’s another startling fact showing how much America’s economy has been tilted in favor of corporate America and against workers for a generation. Between 1948 and 1973, the hourly compensation of a typical worker in America grew in tandem with productivity. But since 1973, productivity grew 74.4 percent while the hourly compensation of a typical worker grew just 9.2 percent.

“This divergence between pay and productivity growth has meant that workers are not fully benefiting from productivity improvements,” the report says. “The economy—specifically, employers—can afford much higher pay, but is not providing it.”

So what should the Fed do to help Main Street and MLK Blvd. begin to enjoy the economic “recovery?” The report suggests a change in the structure of the Federal Reserve System so that fewer representatives from the financial industry and corporate America are appointed to the Fed’s governing board and more regular people are added. This would make the Fed more sensitive to the needs of Main Street and MLK Blvd., so that “the voices of consumers and working families can be heard.”

The Center for Popular Democracy suggests that the Fed keep interest rates low “so that the numbers of job openings and job seekers are balanced and everybody who wants to can find a good job.”

In addition, it wants the Feds to provide low- and zero-interest loans so that cities and states can invest in public works projects like renewable energy generation, public transit and affordable housing that will create good new jobs.

The Fed should study the harmful effects of inequality, according to the Center, and examine how policies like raising the minimum wage and guaranteeing a fair work week can strengthen the economy and expand the middle class.

Source