CPD IN THE NEWS

Progress Illinois - October 29, 2014, by Ellyn Fortino - Chicago Mayor Rahm Emanuel's proposal to lift the city's hourly minimum wage to $13 would leave out approximately 65,000 low-wage workers who are mostly women and people of color.

That's according to a new Center for Popular Democracy report, which compared the potential impacts of the mayor's $13 minimum wage plan with a competing $15 minimum wage ordinance introduced in late May by a group of aldermen, including members of the council's Progressive Reform Caucus. 

The proposed $13 ordinance specifically "shortchanges" domestic and tipped workers, the majority of whom are women of color, according to the report.

The Raise Chicago coalition, which supports the $15 plan, released the report's findings at a City Hall press conference Wednesday morning. More low-wage Chicago workers would be covered by the $15 plan, which would also almost double the economic impact for the city compared to the $13 measure, the report found.

"With the opportunity to nearly double the economic growth of people across the city, our Raise Chicago ordinance would help propel people towards financial stability, help this city and state with tax revenues, and its effects would ripple through every community in Chicago," said Action Now Executive Director Katelyn Johnson, a Raise Chicago leader. "The mayor's proposal does not do enough to address the needs of Chicagoans and, in fact, will keep people living paycheck to paycheck."

In July, Emanuel, along with 25 other aldermen, introduced an ordinance to bump the city's hourly minimum wage from the current $8.25 to $13 by 2018.

The measure models the recommendations of the mayor-appointed Minimum Wage Working Group, which was tasked with researching and gathering public comment about increasing the city's minimum wage. The mayor formed the commission the same month the ordinance seeking to hike Chicago's base wage to $15 an hour by 2018 was introduced.

Under the mayor-backed ordinance, the city's minimum wage for non-tipped employees would increase by $1.25 in each of the next three years and $1 in 2018 to hit the $13 level. The city's minimum wage would be adjusted each year after 2018 to keep pace with inflation. The tipped minimum wage, which is currently $4.95 at the state level, would be lifted by $1 to $5.95 over two years and indexed to inflation after that.

The $15 plan, on the other hand, would require large employers in Chicago making at least $50 million annually to raise their employees' wages to $12.50 an hour within 90 days. Those companies would then have to raise workers' hourly wages to the $15 level within one year of the measure taking effect.

Businesses with less than $50 million in annual revenue would have a different minimum wage phase-in period. Small and mid-sized businesses would have to increase their base hourly wage to $12 within 15 months. After that, the smaller employers would have to increase their minimum wage by $1 each year until they hit the $15 level by 2018.

Johnson said the mayoral working group's measure "burdens small businesses," because it provides "no separate phase-in period for large corporations and small businesses."

The city's minimum wage under the $15 proposal would be adjusted each year after 2018 to keep pace with inflation. If that plan were adopted, the base hourly wage for tipped workers would be 70 percent of the overall minimum wage.

Tipped workers under the $15 ordinance would earn a $10.50 hourly wage once the phase-in process is completed. That wage would be 63 percent greater than what the $13 plan proposes.

Domestic workers, meanwhile, are covered by the Raise Chicago minimum wage ordinance, but they're excluded from the $13 proposal.

"This exclusion would have a disparate impact on women of color, who make up the majority of domestic workers in Chicago," the report reads.

Ovadhwah "O.J." McGee, a Chicago home care aid and SEIU* Healthcare Illinois member, said workers who provide supports to seniors and those with disabilities, for example, deserve a living wage. McGee, a single father who is also a certified nursing assistant, said he earns less than $13 an hour and struggles to make ends meet. He said "$15 would make such a great difference for me."

"The mayor's proposal will leave domestic workers behind. They wouldn't even get the $13 an hour, and that's an injustice," McGee said, adding that the $13 ordinance also "shortchanges tipped workers, providing them with only a $1.50 wage increase."

"That's a shame," he stressed. "The reality is by leaving domestic and tipped workers behind, the mayor is leaving workers of color behind. The majority of these jobs are ... held by African Americans and Latino workers."

Nearly 40 percent of the city's more than 1.3 million workers living in Chicago make less than $15 an hour, according to the report, which also estimated the total number of workers who would see their wages lifted, either directly or indirectly, by the two proposals.

"Under the $15 proposal, we project that 444,000 workers earning up to $17.30 will receive wage increases related to raising the wage floor," the report states. "Under the $13 proposal, only those workers currently earning up to $15.60, or about 379,000 workers, would receive higher wages."

The $13 measure would leave out 65,000 low-wage workers, including 42,000 Chicago residents, according to the report. Of the 65,000 low-wage workers who would be excluded from the $13 plan, approximately 13,000 are African American and 20,000 are Latino.

Additionally, the mayor's $13 measure "fails to secure the truly robust economic recovery that the $15 Raise Chicago ordinance would achieve," the report reads.

After full implementation, the $15 proposal would generate $2.9 billion in new gross wages; $1.04 billion in new economic activity and 6,920 new jobs; more than $80 million in new sales tax revenues; and $125 million in new income tax revenues, the report found.

On the flip side, the $13 plan would lead to $1.25 billion in new gross wages; $522 million in new economic activity; and $40 million in new sales tax revenues.

"Our research found that the benefits of a $15 minimum wage far outweigh those of the mayor's proposed $13," Connie Razza, director of strategic research at the Center for Popular Democracy, said in a statement. "At a time when income inequality is at historic levels and American communities are still reeling from the financial crisis, two dollars more may well be the threshold between survival and stability."

"For Chicago, it means over half a billion more dollars in economic activity that would benefit small businesses and communities, millions more in tax revenue for the city, and would significantly raise the wage floor," she added.

During the March 18 primary election, Chicago voters overwhelmingly supported a non-binding ballot referendum to increase the city's minimum wage to $15 an hour for employees of companies with annual revenues over $50 million. The referendum appeared on the ballot in 103 city precincts, garnering support from about 87 percent of voters.

"The time to raise the minimum wage to $15 an hour is now, and no half measurers will be accepted," Johnson stressed.

Source

The predominantly white male composition of Federal Reserve leadership is facing criticism from Democratic elected officials who believe the institution doesn’t adequately reflect the demographics of the nation it is meant to serve.

The legislators said in a letter to Federal Reserve Chairwoman Janet Yellen on Thursday that central bank leaders also are drawn too frequently from business and financial backgrounds. The letter to Ms. Yellen received support from the leading Democratic candidate for the White House, Hillary Clinton.

Eleven senators and 116 members of the House of Representatives signed the letter, which was organized by Sen. Elizabeth Warren of Massachusetts and Rep. John Conyers Jr. of Michigan. No Republicans participated, although they were given the opportunity to do so.

“Given the critical linkage between monetary policy and the experiences of hardworking Americans, the importance of ensuring that such positions are filled by persons that reflect and represent the interests of our diverse country, cannot be understated,” the letter said. “When the voices of women, African-Americans, Latinos, and representatives of consumers and labor are excluded from key discussions, their interests are too often neglected.”

While the Fed has made “some progress” on diversity issues, the central bank has “considerable work to do” to comply with its legal mandate to represent the interests and diversity of the American people, the letter said.

The Fed said in a statement that it “is committed to fostering diversity—by race, ethnicity, gender, and professional background—within its leadership ranks.” It added that when it comes to the members of the regional boards, “by law, we consider the interests of agriculture, commerce, industry, services, labor, and consumers. We also are aiming to increase ethnic and gender diversity.”

The Fed also cited a rise in both racial and gender diversity on the regional Fed boards, with 46% of all directors now meeting the label of “diverse.”

In February, Ms. Yellen also addressed the issue in testimony to Congress, saying officials in Washington are “constantly attentive in its oversight of the reserve banks to the issue of diversity of representation on those boards. And it has improved considerably.”

The legislators’ letter follows a report earlier in the year from the Center for Popular Democracy’s left-leaning Fed Up Coalition, which took a look at the Washington-based Fed governors, regional bank presidents and boards of directors overseeing the 12 regional banks. That report flagged the fact that even as the Fed is now led by a woman, three of five current governors are men, and all are white. Of the 12 regional Fed bank presidents, 11 are white, two are women, and one is Indian-American. The last black person to hold a top leadership role at the Fed was Roger Ferguson, a vice chairman who left in 2006.

Fed governors are nominated by the president and are subject to Senate approval. Regional Fed bank presidents are nominated by their local boards by members representing firms not regulated by the central bank, subject to the approval of the Fed board in Washington.

The Clinton campaign said the central bank is indeed ripe for change. “The Fed needs to be more representative of America as a whole,” it said in a statement, adding that “commonsense reforms—like getting bankers off the boards of regional Federal Reserve banks—are long overdue.”

Much of the criticism over Fed diversity centers on the make-up of the regional bank boards of directors, which are populated by members of the private sector and oversee the operations of the Fed banks.

The makeup of Fed bank president ranks has been criticized for other reasons as well. The leaders of the New York, Philadelphia, Dallas and Minneapolis branches have all worked for investment bank Goldman Sachs in some capacity.

The Federal Reserve in recent years has faced criticism from both sides of the political spectrum. Many on the right have been angered by the central bank’s aggressive stimulus actions and its role in bailouts of the financial system, and some have wanted to audit the central bank’s process for making monetary policy and force the Fed to set policy based on an explicit and simple rule.

On the left, some have said the Fed has pursued policies that have promoted income inequality and the interests of the financial sector. The low level of diversity has become a more prominent concern in recent months in part because of the report from the Fed Up Coalition.

Meanwhile, former Minneapolis Fed President Narayana Kocherlakota said in a blog post in January that a lack of black representation at the Fed appears to have left central bankers insufficiently attuned to the economic troubles of the African-American community.

The Fed has become an issue in the presidential campaign. Last week, presumptive Republican nominee Donald Trump said he likely would replace Ms. Yellen if he were president. On the Democratic side, Sen. Bernie Sanders of Vermont has long been a critic of the Fed.

By MICHAEL S. DERBY

Source

The Federal Reserve System is one of the most important institutions in the entire American government. Its composition is also almost shockingly non-diverse, with zero African Americans or Latinos serving on the key panel whose decisions impact job creation and the pace of economic growth, despite fairly overwhelming evidence that Fed decisions impact racial groups differently.

What's more, the bodies that choose which people sit on that non-diverse committee are themselves extremely non-diverse — locking into place a system in which the interests of African Americans, Latinos, and lower-income people more generally may be underconsidered in making decisions about unemployment, inflation, and interest rates.

All this is the subject of a letter released at noon today by a group of 111 members of the House of Representatives plus 11 senators, headlined by Elizabeth Warren, Cory Booker, Bernie Sanders, Jeff Merkley, Kirsten Gillibrand, and Al Franken, demanding that the Fed pay more attention to diversity in its ranks.

The key graf:

According to a study by the Center for Popular Democracy released in early February, 2016, 83 percent of Federal Reserve head office board members are white, and men occupy nearly three-fourths of all regional bank directorships. The lack of public representation on regional Banks’ boards is even more distressing in light of the lack of diversity among regional Bank presidents and the resulting lack of diversity on the Federal Open Market Committee (FOMC). Currently, 92 percent of regional Bank presidents are white, and not a single president is either African-American or Latino. Moreover, at present 100 percent of voting FOMC participants are white, while 83 percent of regional Bank presidents and 60 percent of voting FOMC members are men.

Progressives interested in monetary policy issues have long struggled to engage the public, activist groups, or elected officials in the topic. The focus on diversity from the left-wing Center for Popular Democracy's "Fed Up" campaign that inspired this letter represents a new tactical effort to change that.

Diversity among decision-makers is not, of course, directly a monetary policy issue. But as the letter points out, monetary policy does have significant consequences for racial disparities in employment. They cite research from the Economic Policy Institute "demonstrating that for every .91 percent reduction in unemployment for whites, black unemployment drops 1.7 percent" meaning that African Americans have more to gain from monetary policy that is more pro-growth and less inflation-averse.

Michigan Representative John Conyers who was one of the main driving forces behind the letter issued a statement observing that "Detroit and cities across the country with high minority populations have some of the highest unemployment rates and will be harmed if the Federal Reserve does not consider our needs when they make key policy decisions."

How the Federal Reserve is organized

The specifics of the letter hinge on the structure of the Federal Reserve system, which is, in a word, confusing.

The main hub of the Fed is the Board of Governors in Washington, DC, which consists of a chair, a vice chair, and five other board members. Currently there are two vacancies on the board, and all five board members are white.

In addition to the Board of Governors, there are 12 regional Federal Reserve banks, each of which has its own president and its own board of directors. Each bank's president is selected by its board, with the choice subject to confirmation by the main board. Each regional bank board itself is composed in part of members selected by the private banks of the region and in part of members selected by the central board.

Monetary policy decisions are made by what's known as the Open Market Committee. The committee is composed of the seven members of the Board of Governors (at present, again, there are two vacancies) plus the president of the New York Fed, plus four other regional bank presidents serving on a rotating basis.

The point of the letter is that all these various groups underrepresent women and massively underrepresent African Americans and Latinos.

Today's Fed neglects race

Diversity of membership is neither necessary nor sufficient to ensure that a broad range of interests is represented. But there is considerable evidence that the current not-so-diverse group of monetary policymakers is not considering the full range of interests in American society.

Narayana Kocherlakota, the former president of the Federal Reserve Bank of Minneapolis, was the only nonwhite FOMC member during his term and offered this observation back in January:

However, there is one key source of economic difference in American life that is likely underemphasized in FOMC deliberations: race. Let’s look, for example, at the most recently released transcripts for FOMC meetings, which cover the year 2010 (my first full year on the Committee). It was a challenging year for the US economy as a whole, as the unemployment rate was above 9 1/4% in every month. But it was especially challenging for African-Americans: In every month of 2010, the unemployment rate among African-Americans was at least 15 1/2%. I did a search of the hundreds of pages of the meeting transcripts. Based on that search, my conclusion is that there was no reference in the meetings to labor market conditions among African-Americans (or Black Americans).

Monetary policymakers, with their needed independence, always risk being (or at least being seen as) insufficiently empathetic to the lives of their nations’ citizens. The Federal Reserve Act has mitigated this risk in the US by ensuring that an appreciation for economic diversity is at the heart of the FOMC’s deliberations.

The details of monetary policy get pretty complicated, and there's rarely been much sign of normal people being interested in them. But issues about who is represented and whose interests get discussed are easier to understand, so you can see why this particular angle is gaining momentum in Congress.

After the release of the letter, Hillary Clinton also weighed-in on the issue via spokesman Jesse Ferguson who offered a statement:

The Federal Reserve is a vital institution for our economy and the wellbeing of our middle class, and the American people should have no doubt that the Fed is serving the public interest.  That's why Secretary Clinton believes that the Fed needs to be more representative of America as a whole as well as that commonsense reforms — like getting bankers off the boards of regional Federal Reserve banks — are long overdue.  Secretary Clinton will also defend the Fed's so-called dual mandate — the legal requirement that it focus on full employment as well as inflation — and will appoint Fed governors who share this commitment and who will carry out unwavering oversight of the financial industry

By Matthew Yglesias

Source

Nueva York— Freno a la epidemia de robo de salarios fue la consigna que gritaron sin cesar  unas 30 empleadas domésticas y jornaleros frente a la Corte de Brooklyn. La acción, liderada por el Proyecto de Justicia Laboral (WJP), sirvió para exponer a un contratista inescrupuloso como parte de  “una maquinaria que exprime a las familias trabajadoras”.

Los defensores denunciaron que la creación de’ empresas fantasma’ es una estrategia que los empleadores para esquivar a las autoridades y seguir en el negocio pese a tener casos abiertos en las cortes de la ciudad.

Samuel Just, propietario de Just Cleaning, fue arrestado el verano pasado por la Fiscalía de Brooklyn luego de que el WJP documentara varios casos de robo de salario. Pese a la presión de las autoridades y de los grupos defensores de los jornaleros, el empresario se niega a pagar a las víctimas, la mayoría mujeres latinas.

“El robo de salario es un crimen. No hay otra manera de calificarlo”, sentenció Ligia Guallpa, directora ejecutiva del WJP.

Otras organizaciones se unieron a la protesta para denunciar que el robo de salario afecta radicalmente a las comunidades inmigrantes. Gonzalo Mercado, director ejecutivo de Staten Island Community Job Center, explicó que los contratistas están creando empresas fantasmas para evadir a las autoridades y las pesquisas de los activistas.

“Hemos visto a empleadores circulando por las paradas de jornaleros con camionetas sin logotipos. Su estrategia es evitar ser identificados”, sentenció. “Muchos trabajadores no saben quién los contrata, lo que hace más difícil la recuperación de los salarios”.

El mexicano Oscar Lezama (36) contó que una compañía de Staten Island, que se dedica a la instalación de cocinas, se negó a pagarle unos mil dólares por horas extra.

“No sabía para quién trabajaba. Nunca vi nombres o logotipos que identificaran a la compañía”, comentó.

La organización Staten Island Community Job Center ayudó a Lezama a recuperar su salario mediante negociaciones directas con el propietario, pero Mercado dijo que identificar a la compañía implicó una investigación exhaustiva.

“Las organizaciones, de alguna manera, estamos tomando el rol del Departamento de Trabajo para recuperar los salarios”, dijo Mercado. “Muchos contratistas prefieren la negociación directa y así evitar comparecer en una corte, lo que reduce el tiempo de recuperación de salario, algo que beneficia al trabajador”.

Los defensores están pidiendo mano dura para los contratistas que reinciden en el robo de salario. Parte de sus esfuerzos implica que la Ciudad revoque o niegue la renovación de las licencias.

“Los contratistas recurren a subcontratistas para contratar jornaleros y luego no pagarles”, dijo Guallpa. “En las cortes se defienden argumentando que nunca contrataron al trabajador”.

De acuerdo con la activista, Samuel Just estaría recurriendo a estas estrategias para evadir su responsabilidad. El empresario presuntamente recurre a subcontratistas y empresas fantasma para continuar en el negocio y esquivar a los fiscales, algo que WJP está documentando.

La protesta frente a la Corte de Brooklyn fue la quinta acción colectiva convocada por WJP para exponer al propietario de Just Cleaning, pero también para crear conciencia acerca de que el robo de salario es un problema, que se agudizó en los últimos años, según defensores.

“La falta de denuncia, el miedo de los trabajadores indocumentados y las leyes débiles están nutriendo el abuso de los empleadores”, se lamentó Omar Henríquez, organizador de la Red Nacional de Trabajadores por Día (NDLON). “El robo de salario implica la evasión de impuestos. Es perjudicial para nuestros gobiernos y comunidades”.

El Servicio de Impuestos Internos (IRS) estima que los empleadores clasifican erróneamente a millones de empleados cada año en el país, evitando en promedio cerca de $4.000 en impuestos federales por cada trabajador.

Las víctimas de Just declinaron hacer comentarios por recomendación de sus abogados, pero estuvieron en la protesta demandando justicia. Varias llamadas al empleador no fueron atendidas al cierre de esta edición.

Un estimado de 2.1 millones de neoyorquinos son víctimas de robo de salario al año, lo que representa una pérdida de $3.2 mil millones en pagos y beneficios, según el reporte “By a Thousand Cuts: The Complex Face of Wage Theft in New York” del Center for Popular Democracy Action (CPDA).

Según la Fiscalía de Brooklyn, Just recogía a los trabajadores en una van en la esquina de las avenidas Marcy y Division -en el barrio de Williamsburg-, y les ofrecía entre $10 y $15 la hora. El contratista hizo trabajar  a los jornaleros hasta 27 horas seguidas durante la celebración de Pesaj o Pascua Judía, que implica una intensa limpieza de los hogares.

Al menos 11 trabajadores -la mayoría mujeres- habrían sido víctimas  de Just, pero sólo cinco se atrevieron a denunciarlo, según los activistas.

“El castigo de empleadores como Just motivará la denuncia y enviará un mensaje claro a otros contratistas que violan las leyes. Sólo así frenaremos la epidemia de robo de salario en Nueva York”, dijo Guallpa.

Source: El Diario