Inequality.org – Informed Comment https://www.juancole.com Thoughts on the Middle East, History and Religion Sat, 04 Dec 2021 05:16:05 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.18 Why We Can’t Trust the World Bank to Stand Up to Powerful Fossil Fuel Companies https://www.juancole.com/2021/11/powerful-fossil-companies.html Sun, 21 Nov 2021 05:08:45 +0000 https://www.juancole.com/?p=201353

While the divestment movement is working to hold fossil fuel companies accountable, the World Bank is protecting and financing them.

By Manuel Pérez-Rocha | –

( Inequality.org) – At the international climate change negotiations in Scotland, the World Bank tried to position itself as a global champion in alleviating the climate crisis. In reality, this multilateral financial institution has been promoting and defending extractive and fossil fuel industries.

In a courageous column in the Guardian, one of the World Bank’s own researchers, Jake Hess, criticizes his employer for having spent more than $12 billion to fund fossil fuel projects since the Paris climate agreement in 2015.

“Sadly, I have little confidence that my employer will become a climate leader any time soon,” Hess wrote.

This is hardly surprising, given that Donald Trump picked current World Bank President David Malpass. Like the former U.S. president, Malpass has denied that human-produced carbon emissions cause global warming and climate change.

While the World Bank has continued to fund fossil fuel projects, many other institutions have pulled their money out.

A new report, “Invest-Divest 2021: A Decade of Progress Towards a Just Climate Future,” reveals that there are now 1,485 institutions in 71 countries publicly committed to fossil fuel divestment. The report is co-published by the C40, the Wallace Global Fund, the Institute for Energy Economics and Financial Analysis and Stand.Earth and disseminated by the Dutch NGO Both Ends. The divesting institutions represent $39.2 trillion of assets under management.

“That’s as if the two biggest economies in the world, the United States and China, combined, chose to divest from fossil fuels,” the report notes.

Global inequality

Get the facts

The C40 coalition was founded in 2005 by the then Mayor of London, Ken Livingston, to build a collaborative network of mayors to deliver the urgent action needed to confront the climate crisis. Nearly 100 major cities now participate, including 14 in the United States, two in Mexico, and three in Canada.

This divest movement also includes grassroots environmental organizations, such as 350.org and Rainforest Action, and faith-based groups, including the World Council of Churches. In addition to the Wallace Global Fund, Ford, MacArthur, and other philanthropic foundations are also supportive.

This movement’s efforts to hold fossil fuel companies accountable for the true cost of their greenhouse gas emissions and in reducing their political power stands in stark contrast to the World Bank’s activities. Beyond their financial assistance for the fossil fuel projects, the Bank also house the International Centre for Settlement of Investment Disputes (ICSID), a tribunal where transnational corporations can file lawsuits against governments over actions — including environmental regulations — that reduce the value of their investments.

In another article, I argue that allowing corporations to keep filing these multi-million dollar lawsuits will potentially undermine the agreement reached in Glasgow.

Claims by extractive industries have increased exponentially during the last two decades. These companies were awarded at least $73 billion since 1995, according to my own calculations based on data available from ICSID and UNCTAD (and there are many other cases for which ICSID and other tribunals do not disclose any information).

Extractive companies are the most frequent users of the investor-state dispute settlement system (ISDS), making up 29 percent of all ICSID claims in fiscal year 2021. They also obtain the largest awards. Of the 14 known rulings for more than $1 billion, 11 relate to the oil, gas and mining industries.

At least 82 lawsuits filed by extractive industries are still pending, among which 42 were filed by companies asking a total amount of $99 billion in compensation, according to the information available ($71 billion from mining companies and $28 billion from oil and gas companies).

It is worth noting that the amounts claimed for the other 40 pending lawsuits are not publicly available, therefore the above figures are merely illustrative of the magnitude of the problem. Notwithstanding the lack of information, it is possible to determine that at least 14 pending cases are demanding over $1 billion, including outrageous claims for $27 billion against Congo and $16.5 billion against Colombia.

Another case involves TransCanada against the United States. The Canadian company is demanding $16 billion in compensation for the Biden administration’s cancellation of the controversial Keystone XL pipeline. Of course, Mexico is part of the list, facing a $3.5 billion lawsuit by the U.S. company Odyssey Marine Exploration for the denial of a mining permit in marine sub-soils of the Sea of Cortez.

To effectively combat climate change, every government needs room for maneuver to be able to implement sound policies and climate actions without being blackmailed by costly corporate lawsuits. The investor-state lawsuit system must not stand in the way when it comes to addressing climate change and the civilizational threat it poses to the world.

By housing and supporting ICSID, the World Bank further tarnishes its credibility on climate change. But national governments are also at fault. They put the future of the planet at risk by turning a blind eye at climate summits to trade and investment rules (including the US-Mexico-Canada Free Trade Agreement) that reward polluting activities and protect the interests of extractive industries.

For now, the solution certainly lies in continuing to divest from planet-devastating extractive corporations.

Originally in Spanish in La Jornada

Via Inequality.org

Content licensed under a Creative Commons 3.0 License

]]>
To Tackle Climate Change, Hold Fossil Fuel Conglomerates Accountable https://www.juancole.com/2021/11/climate-conglomerates-accountable.html Sun, 14 Nov 2021 05:06:39 +0000 https://www.juancole.com/?p=201221

Movements are using this once-in-a-lifetime political moment to mobilize communities against climate change and corporate greed.

By Samantha Garcia | –

( Inequality.org) – Since the Industrial Revolution, the United States has single-handedly accounted for a quarter of all CO2 emissions produced. As Congress negotiates the details of a historic budget reconciliation package, lawmakers have an opportunity to reverse course, but large fossil fuel corporations are conspiring with politicians through corporate influence to halt transformative investments in our climate.

And Americans are starting to take notice.

Hundreds of Indigenous leaders and frontline community organizers from across the country gathered in Washington, D.C. to hold President Biden and his administration accountable for the climate promises made during the presidential campaign.

Build Back Fossil Free, an environmental justice network composed of national, state, and local organizations, mobilized to convene a People vs Fossil Fuels week of action which commenced on Indigenous Peoples’ Day and lasted from October 11 to October 15.

Water protectors, who risk their lives by using their bodies to block pipelines and stand up to big corporate polluters in their communities, found themselves on the frontlines of the White House, getting arrested for the same purpose — to protect our water. The president and his administration had a choice that week: Meet with us and take executive action to reduce carbon emissions and delay upcoming cataclysmic climate disasters, or arrest people. It chose the latter. On the first day of action, 135 water protectors were arrested for civil disobedience. In total, 655 people were arrested that week.

The organizers, leaders, and protectors who came to D.C. for this event returned to their communities at the week’s end knowing that their local fights — whether it be trying to stop a pipeline in Minnesota, shut down petrochemical facilities in Louisiana, oil drilling in the southwest, or terminating liquified natural gas export terminals in the Gulf Coast — are all interconnected. These regional battles play a key role in the collective war against global warming.

“It is no exaggeration to say that climate chaos is now reality,” said Maya K. van Rossum, the leader of Delaware Riverkeeper network, in a statement. “While politicians are finally starting to acknowledge that the floods, fires, droughts, and catastrophic storms sweeping the nation are a present-day manifestation of climate change, it is of little value if it is not accompanied by meaningful action to end the era of fossil fuels.”

Western droughts in states like Arizona are intensifying while West Virginians and its coal mining communities are dying at alarming rates due to asthma, pulmonary diseases, cancer, and other similar detrimental illnesses caused by polluting industries. But despite this reality, elected officials like Senators Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ) have stonewalled progressive action on climate change.

Manchin, who owns stock in a coal brokerage company, continues to argue that the cost of the Biden administration’s Build Back Back better agenda is too high and poses a threat to coal industry jobs in his state. Sinema, meanwhile, hasn’t provided any substantial reasoning for her opposition. Her avoidance in the face of questions from reporters and constituents could be linked to the fact that she, along with five other Democrats including Manchin, received $333,000 from Exxon lobbyists.

Progressive Democrats support President Biden’s ambitious goal of cutting U.S. greenhouse gas emissions by 50 percent, while simultaneously incentivizing clean energy usage that would have the U.S. relying on 80 percent clean electricity by 2030 with the Clean Electricity Payment Program. This $150 billion clean energy program would compensate utilities in their energy source transitioning and penalize utilities that don’t. But moderates, Sinema and Manchin are not on board with this foundational component of the President’s climate agenda, with Manchin putting the final nail in the coffin on this climate proposal.

We can no longer afford to allow the power of corporate polluters to go unchecked. Tackling and addressing climatic conditions isn’t just an ethical, moral, or public health concern — it is a global issue that concerns us all and touches every facet of our lives. If we’re going to preserve life, understanding the depth and seriousness of this is eminent. As UN Secretary-General António Guterres stated in the latest Intergovernmental Panel on Climate Change report: “This is code red for humanity”

None of us are alone in the fight against climate change. The People vs Fossil Fuels actions successfully connected local, placed-based environmental justice struggles to the overall national movement. From ravaging Western fires to wrecking Eastern floods, climate change will only continue to gradually and severely impact people in the United States. We still have time to recognize, develop, and mobilize communities against climate change and corporate greed.

Sam Garcia is a New Mexico fellow at the Institute for Policy Studies.

Via Inequality.org

Content licensed under a Creative Commons 3.0 License

——-

Bonus Video added by Informed Comment:

DW Planet A: “Why fossil fuel companies should be lawyering up”

]]>
The Labor Day Dreams of Black Workers https://www.juancole.com/2021/09/labor-dreams-workers.html Sun, 05 Sep 2021 04:06:56 +0000 https://www.juancole.com/?p=199882

Leading Black labor organizers and policy advocates share their visions for advancing racial equity in the Covid recovery — and beyond.

By Marc Bayard, Sarah Anderson and Rebekah Entralgo | –

As our second pandemic Labor Day approaches, Black worker leaders are determined to never again bear the brunt of a national crisis as they have under Covid-19.

At least four U.S. employees have now been killed as they tried to enforce mask mandates — and all of them were Black essential workers.

Countless other Black Americans, who make up a disproportionate share of retail, food, social service, and other frontline workers, have had to contend with anti-maskers’ racist slurs and other abuse — on top of their relatively high rates of Covid-19 infection.

Black workers who lost their jobs during the crisis have also had a rocky return to employment. As of July, the Black unemployment rate was 8.2 percent, compared to 4.8 percent for white workers.

How can we make the recovery more equitable — and improve conditions for Black workers before the next crisis hits? We asked nine leading Black labor organizers and policy advocates for their views.

“If our work is truly essential, then we deserve the right to negotiate with our employers for better pay and benefits,” said Erica Smiley, Executive Director of Jobs With Justice.

Smiley’s focus on collective bargaining rights was common among our interviewees. This is hardly surprising at a time when CEO pay is soaring as employees are suffering. An Institute for Policy Studies analysis of the 100 largest low-wage employers found that average pay for their virtually all-white CEOs rose 15 percent to $14 million in 2020. That’s 689 times as much as their typical worker pay.

One of these overpaid CEOs, Amazon’s Jeff Bezos, presided over the blatant suppression of an organizing drive this past spring at an Alabama warehouse where the workforce was more than 80 percent Black. Although the union did not win the vote, Linda Burns, a mother of five who worked at the facility for over a year, told us the “fight is not over” for “better wages, better working conditions, and equal opportunities for all workers at Amazon.”

The workers are getting a chance at a re-vote after federal authorities determined Amazon acted inappropriately to block the union.

Organizers emphasized that the Alabama Amazon battle strengthened the case for the Protecting the Right to Organize (PRO) Act, a federal bill to ensure every worker’s right to advocate for themselves without fear of employer retaliation. Labor advocates, joined by allies in the climate, peace, LGBTQ+, and other movements, are upping the pressure on a handful of conservative Senate Democrats who are holdouts on the PRO Act.

“If our work is truly essential, then we deserve the right to negotiate with our employers for better pay and benefits,”

Erica Smiley, Executive Director, Jobs With Justice

AFL-CIO chief economist William Spriggs noted that Black workers arguably have the most to gain from the bill because they have “suffered the greatest collapse in their protection of collective bargaining agreement coverage.” The Black unionization rate fell from 17.1 percent in 2000 to 13.9 percent in 2020.

Jonathan Smith, New York Metro Area Local President of the American Postal Workers Union, commented on how labor unions have “showed Black America the power of we over me.” He’s encouraged by the broad public support for protecting unionized postal jobs and making it easier for all workers to join unions and reestablish the middle class.

“This country was made great by men and women in overalls — not men and women in suits,” Smith said.

Black worker leaders also see huge opportunities for addressing the care crisis that has hit their communities particularly hard. Black workers make up 23 percent of all home health care jobs (nearly double their share of the U.S. workforce), which tend to be poorly paid with no benefits. President Biden has proposed $400 billion to support living wage jobs in this sector and billions more to provide subsidized child care and paid family and medical leave.

Josephine Kalipeni, Deputy Director of Family Values at Work, sees such investments as critical tools to “disrupt generational poverty experienced by Black workers.”

Allison Julien, the We Dream in Black organizer for the National Domestic Workers Alliance, said these proposals would help both care workers and those who need care. “Many Black families are piecing together care for loves ones with little to no additional financial support,” she said.

Kalipeni and Julien’s organizations are part of a “Care Can’t Wait” coalition that is fighting to keep robust care infrastructure investments in the budget deal as it moves through Congress.

Tanya Wallace-Gobern, Executive Director of the National Black Workers Center, hopes the current crisis will create an opening for expanding workplace health and safety standards “beyond trips, slips, and falls” to include protections against racial discrimination, harassment, and violence. These are hardly new problems, but they have surged in a highly polarized political climate that has empowered white supremacists.

Abusive conditions for restaurant servers have contributed to staffing challenges in many parts of the country. Organizers are working to leverage this to win long-overdue improvements for the restaurant workforce, which is disproportionately people of color.

While these workers have “prepared our food, delivered it to our doorsteps, or brought it to our table, helping our nation to remain safe and healthy while risking themselves, many still earn subminimum wages and have no access to paid leave and health care,” said Dr. Sekou Siby, president and CEO of Restaurant Opportunities Centers (ROC) United.

The mobilizations sparked by police brutality have also strengthened demands on big corporations to go beyond PR buzzwords when it comes to racial justice.

“We cannot let corporations say Black Lives Matter and then give money to decimate the voting rights of Black and Brown voters or fight against union rights or raising the minimum wage,” said Renaye Manley, who chairs the board of the Worker Center for Racial Justice and leads the SEIU capital stewardship program and shared her personal views with us. “We are in the position to call them out and to change behavior in a way that builds power and respect for our communities, and workers.”

None of the Black leaders we spoke to had any illusion that we can fully achieve Black worker justice without the long-term transformative change of our political and economic systems. But they all recognized the momentousness of the moment.

“We will have to answer to future generations about how we responded when it became inarguably clear that our economy doesn’t work for those whose work makes everything else possible,” said Kalipeni of Family Values at Work. “By solving with and for Black workers, especially Black working women, we will create an economy that works for all.”

The nine labor leaders’ full statements on opportunities for advancing Black worker justice.

Marc Bayard directs the Black Worker Initiative, Sarah Anderson directs the Global Economy Project, and Rebekah Entralgo is Managing Editor of Inequality.org at the Institute for Policy Studies

—–

Bonus Video added by Informed Comment:

CNBC Make It: “How Corporate America Is Failing Black Employees”

]]>
Jeff Bezos Should Have Thanked American Taxpayers for Paying for His Space Ride https://www.juancole.com/2021/07/thanked-american-taxpayers.html Sun, 25 Jul 2021 04:02:14 +0000 https://www.juancole.com/?p=199067

From the very start, the giant retailer’s business strategy has relied on dodging taxes and pocketing public subsidies.

By Scott Klinger | –

( Inequality.org ) – Shortly after emerging from his 10-minute space flight last week, Jeff Bezos thanked Amazon customers and employees for their primary role in paying for his Blue Origin joyride to the edge of space.

The Amazon founder’s comments quickly elicited scorn from many employees who toil in extreme working conditions for little pay and with bathroom breaks half as long as Bezos’s short rocket ride.

But American taxpayers should be just as roiled for not being mentioned by Bezos at all. Commentators pointed to Bezos’s Blue Origin and Sir Richard Branson’s earlier trip on Virgin Galactic’s Unity spacecraft as being privately funded, but in Bezos’s case that is far from the truth.

Dodging taxes and winning public subsidies have been core to Amazon’s business strategy from the start, when its e-commerce sales eluded state and local sales taxes. Later as the retailer expanded its distribution network, Amazon aggressively demanded passes on paying local property taxes in exchange for the promise of bringing jobs to a community.

And when Amazon finally turned profitable, the company used various tax reduction schemes, including paying executives with stock options and running transactions through off-shore tax havens. This enabled Amazon to become one of a number of highly profitable companies that have contributed next to nothing to the costs of the federal government.

Early on, Amazon located its shipping centers in states without sales taxes. It successfully argued that the transaction occurred where the package left its distribution center, not once it was left at the customer’s front door. This tactic saved Amazon customers billions of dollars, and gave Amazon an enormous competitive advantage over brick-and-mortar stores that had to collect sales taxes.

As Amazon evolved, fast delivery became more important, leading the company to rapidly expand its vast distribution network closer to its customers. Recognizing that this would challenge the underpinnings of its sales tax dodging strategy, Amazon began to demand – and most often receive – lucrative tax breaks and other cash subsidies from communities where Amazon opened facilities and created jobs.

Over the years, Amazon has collected nearly $3.3 billion in 200 different tax subsidy deals with state and local governments, according to Good Jobs First’s Subsidy Tracker database. In many cases, that means when an ambulance is dispatched to an Amazon warehouse to tend to a worker overcome by heat, Amazon has left the cost of such services to other taxpayers to pay. Or when Amazon hires an educated worker, it does so knowing that it often contributed little to pay for local government’s investments in schools.

In the three years between 2018 and 2020, Amazon reported $44.7 billion in U.S. pre-tax profits, but paid just $1.9 billion in U.S. corporate income taxes, according to a 2021 analysis by the Institute on Taxation and Economic Policy (ITEP). These paltry payments gave Amazon an effective tax rate of just 4.3 percent, a fraction of the tax rate paid by typical middle income U.S. families, and only a fifth of the 21 percent statutory U.S. corporate income tax rate.

Bezos claims to have invested $7.5 billion in Blue Origin. U.S. taxpayers have invested many times that amount in Amazon through sales tax loopholes, property tax subsidies, and federal tax avoidance schemes.

If Amazon had paid the full 21 percent corporate tax rate over the last three years, the company would have paid $7.2 billion more in federal taxes, money that could have been used to invest in basic research, education, national security, and COVID aid for struggling families and small businesses.

Bezos’s New Shepherd suborbital flight recreated the historic 1961 flight of America’s first astronaut Alan Shepherd. Back then the U.S. corporate tax rate was 48 percent. If Amazon had paid that same rate on its income in the last three years, the company would have paid an additional $19.5 billion in U.S. income taxes.

Amazon is not alone in not paying its fair share in federal taxes. Back in 1961, corporate income taxes comprised 22.1 percent of the federal government’s revenue. Last year, corporations paid just 6.6 percent of Uncle Sam’s bills, despite U.S. corporations being far more profitable than when Alan Shepherd flew aboard Freedom 7.

Bezos claims to have invested about $7.5 billion in Blue Origin to date. U.S. taxpayers have invested many times that amount in Amazon through sales tax loopholes, property tax subsidies, and federal tax avoidance schemes. It is we, the American taxpayers, along with Amazon’s hard-working, underpaid workers, that made this billionaire’s 10-minute thrill ride possible.

Scott Klinger is an Associate Fellow at the Institute for Policy Studies.

Via Inequality.org

Content licensed under a Creative Commons 3.0 License

—–

Bonus Video added by Informed Comment:

The Hill: “Bernie Sanders CALLS OUT Jeff Bezos and Amazon for not paying taxes”

]]>
Around the World, Excessive Corporate Power Breeds Political Repression https://www.juancole.com/2021/07/excessive-corporate-repression.html Sat, 17 Jul 2021 04:01:58 +0000 https://www.juancole.com/?p=198939

In the face of extractive industries’ enormous economic clout, Central Americans are facing increasing displacement and threats to their democratic rights.

By Manuel Perez-Rocha | –

Free trade agreements and other neoliberal economic rules grant excessive privileges to transnational corporations, elevating their narrow interests above people’s livelihoods and the environment. Beyond mere economic prescriptions, neoliberalism also embraces repressive and anti-democratic measures.

We are increasingly seeing this in the Northern Triangle of Central America, which includes Honduras, Guatemala, and El Salvador. The people of these countries are facing dispossession and forced displacement to clear the way so the extractive and agro-industrial model can thrive.

Global Witness has documented that 14 Honduran and 12 Guatemalan land and environmental defenders were killed in 2019 alone.

In Guatemala, a new law would make such activists even more vulnerable. Through a reform of an existing law regulating non-governmental organizations’ activities, the government is acting to protect the interests of economic elites.

As a letter organized by the Network in Solidarity with the People of Guatemala (NISGUA) and allied organizations points out, the new law grants the Guatemalan government the authority to permanently shut down any NGO if their activities are considered to violate “public order.” This vague language could be exploited to suppress freedom of expression and peaceful protests.

This reform will also reinforce a clause in the Central American Free Trade Agreement (CAFTA) — and found in virtually all free trade agreements and bilateral investment treaties — that requires governments to provide “Full Protection and Security” to foreign investors, including police protection.

The U.S. mining company KCA sued Guatemala for $400 million under this clause, falsely claiming that the government failed to protect its gold mine from the resistance of local communities to protect their water resources and their peaceful sit-in at La Puya.

These repressive measures in Guatemala parallel the repression in Honduras, where communities in the municipality of Tocoa have resisted the mining operations of Inversiones Los Pinares, owned by the country’s elites (like the Facussé family) and fueled by transnational capital.

My organization, the Institute for Policy Studies, awarded in 2019 the Letelier-Moffitt International Human Rights Award to Tocoa’s Municipal Defense Committee of the Common and Natural Goods, in recognition of their efforts to defend water against the onslaught of extractive industries. The Honduran government responded to this campaign with repression and militarization of the region and arrested 32 environmental activists. Despite the lack of evidence, eight of them remain imprisoned.

Juan Lopez, receiving the 43rd Annual Letelier-Moffitt Human Rights Awards on behalf of the Comite Municipal de Defensa de Bienes Comunesy Naturales del Municipio de Tocoa, Washington, DC Oct. 3, 2019. Credit: Rick Reinhard.

Juan Lopez, who received the Letelier-Moffitt award on behalf of the Committee, made powerfully clear that his community’s struggle is part of a bigger international story:

Tegucigalpa, Washington, San Salvador, Bogota, Guayaquil, Guatemala, Santiago, Panama, appear day after day on the front pages of conservative newspapers as the political centers where high-level corruption magnates, through privatization or concessions, hand over airports, highways, educational systems, health, territories of high biological value, men and women workers’ pensions. Every day, they are squeezing our throats and the set of rights and guarantees established in our nations’ outdated constitutions that sleep in the drawer of oblivion, while huge armies of white collars and uniformed facilitate the transit of global merchandise. The eye of the hurricane of world capitalism seems to be the great addiction on which agro-industrial plantations, mining, and other extractive projects are built.

A study by the Central American Alliance Against Mining (ACAFREMIN) confirms that the main threat to the region’s peoples and territories is the imposition and perpetuation of this extractive economic model, often without any consultation with local communities — much less their consent. And now in many cases, these destructive projects are being touted as post-pandemic economic recovery.

The alliance also makes clear that excessive corporate power is a key root cause of migration. They report that many people from this region have had to migrate to escape from persecution aimed at protecting the geostrategic interests of U.S., Canadian, and European corporations.

Citing rights established by the UN Committee on Economic, Social and Cultural Rights, the alliance is demanding “the human right to life, food, quality water and sanitation as a key condition for our peoples to live with dignity.”

To secure these basic rights for all, we must undo the rules that put the interests of corporations above those of people and the planet.

Original published in Spanish in La Jornada.

Manuel Pérez-Rocha is an Associate Fellow of the Institute for Policy Studies in Washington, D.C., and an Associate of the Transnational Institute in Amsterdam. Follow him @ManuelPerezIPS

Content licensed under a Creative Commons 3.0 License

—-

Bonus Video added by Informed Comment:

Why is police violence so widespread in Latin America? | DW Analysis

]]>
The Decades-Long Struggle Over Big Corporations and Poverty Wages https://www.juancole.com/2021/03/decades-struggle-corporations.html Tue, 09 Mar 2021 05:01:26 +0000 https://www.juancole.com/?p=196546

Taxpayers shouldn’t have to subsidize labor costs at Fortune 500 corporations.

By Phil Mattera | –

( Inequality.org ) – The Senate Parliamentarian dealt a strong blow to the Fight for $15 movement by ruling that a federal minimum wage increase could be included in the stimulus bill. Senator Bernie Sanders is pushing back with an amendment to take tax deductions away from large, profitable corporations that do not pay at least $15 an hour.

This is just the latest battle in a struggle over big business wage practices that goes back decades. There was a time when landing a job with a large corporation was, even for blue collar workers, a ticket to a comfortable life — good wages, generous benefits, and a secure retirement. Women and workers of color did not share fully in this bounty, but they generally did better at big firms than small ones.

All this began to unravel in the 1980s, when big business used the excuse of global competition to chip away at the living standards of the domestic workforce. This took the form of an assault on unions, which had played a key role in bringing about the improvements in the terms of employment. In meatpacking, for instance, what had been a high-wage, high-union-density industry turned into a bastion of precarious labor.

When large corporations off-loaded a substantial portion of their employment costs, they created a higher burden for the public sector. As their pay and benefits shrank, workers turned to the social safety net to fill the gap. Programs such as Medicaid and Supplemental Nutrition Assistance Program (food stamps) that were originally designed for employees of small firms and for the unemployed became a lifeline for the workforce at some Fortune 500 companies.

From a social point of view, this was a good thing — but it also created a situation in which taxpayers were in effect subsidizing the labor costs of mega-corporations. This became an issue in the early 2000s with regard to Walmart, and there were unsuccessful efforts in states such as Maryland to require large firms to spend more on employee healthcare.

Although the issue receded from public attention, figures such as Senator Sanders have sought to keep it alive, putting the main focus on the employment practices of Amazon.com. In 2018 Sanders helped pressure the giant e-commerce firm to raise its wage rates by introducing legislation that would have taxed large companies to recoup the cost of government benefits given to their employees.

Now the chair of the Senate Budget Committee, Sanders is continuing his effort from a position of even greater influence. In the lead-up to the Senate Parliamentarian’s ruling, he held a hearing on whether taxpayers are subsidizing poverty wages at large corporations. As in 2018, just highlighting the issue had a concrete impact. At the hearing the chief executive of Costco announced that his company would raise its minimum pay rate to $16 an hour. This came a week after Walmart hiked its rate to $15 but only for a portion of its workforce.

McDonald’s employee Terrence Wise, testifying before the Senate Budget Committee, Feb. 25, 2021.

After years of wage stagnation, it is heartening to see that large companies are beginning to feel some pressure to boost their wage rates. Yet rises of only a few dollars an hour will not do the trick. Pay needs to be substantially higher than $15 an hour. That’s why the real solution to the problem is not voluntary corporate action but rather collective bargaining. Amazon and Walmart could assist their workers much more by dropping their opposition to unionization.

Having a voice at work would solve not only the pay problem but also the crisis in healthcare coverage and other benefits. The scope of that crisis was made plain by another speaker at the Senate Budget Committee hearing. Cindy Brown Barnes of the Government Accountability Office summarized research showing that an estimated 12 million adults enrolled in Medicaid and 9 million adults living in households receiving food stamp benefits earned wages at some point in 2018.

The GAO had more difficulty determining the portion of these populations employed at large corporations. That is because only a limited number of the state agencies administering Medicaid and food stamps collect and update employer information on recipients.

The partial data is still revealing. Among the six states providing employer information for Medicaid recipients, Walmart was in the top ten in all, while McDonald’s and Amazon were in five. Among the nine states providing employer information for food stamp recipients, Walmart was in the top ten in all, while McDonald’s was in eight and Amazon was in four.

These findings provide valuable information for the Sanders campaign against poverty wages. Companies such as Amazon—which recently reported that its annual revenues in 2020 were up 38 percent and its profits nearly doubled to $21 billion—can well afford to pay employees a living wage and provide the benefits necessary for a decent standard of living.

Public safety net programs are essential to society, but those who are employed by mega-corporations should not have to make use of them.

Phil Mattera directs the Corporate Research Project, an affiliate of Good Jobs First.

Via Inequality.org

——–

Bonus Video added by Informed Comment:

Thomas Hartmann: “Democracy Itself Needs A Higher Minimum Wage?”

Content licensed under a Creative Commons 3.0 License

]]>
If We Want to Renew Democracy, We Need to Tax the Ultra-Wealthy https://www.juancole.com/2021/03/renew-democracy-wealthy.html Sun, 07 Mar 2021 05:01:46 +0000 https://www.juancole.com/?p=196508 By Madeleine Johnsson | –

After the tech sector, Wall Street is the second-highest source of wealth for American billionaires.

( Inequality.org ) – Sen. Elizabeth Warren and Rep. Pramila Jayapal’s Ultra-Millionaire Tax Act of 2021, introduced March 1, could not be a more timely reminder that the United States needs serious policy changes to address massive wealth and income inequality. While eight million Americans slipped into poverty and half a million lives were lost to Covid-19 since the beginning of the pandemic — all with a disproportionately large impact on communities of color — the wealth of U.S. billionaires almost doubled, up $1.3 trillion. At this rate, it would take five more months for the wealth of the richest Americans to match the $1.9 trillion relief package put forward by the Biden administration.

U.S. Supreme Court Justice Louis Brandeis, the great antagonist of concentrated financial power, famously observed in the last century: “We can have democracy in this country or we can have great wealth concentrated in the hands of a few, but we cannot have both.” In this century, too, we have seen the wisdom of this insight. Billionaires who are the new robber barons — Schwarzman, Koch, Bloomberg, Paulson — have flooded the democratic process with money, often with the goal of securing policies that will make them and their children ever more wealthy as a key goal.

Blackstone CEO Steve Schwarzman, with Warren for President campaign mug.

After the tech sector, Wall Street is the second-highest source of wealth for American billionaires, according to calculations by Americans for Financial Reform based on data collected by Americans for Tax Fairness and the Institute for Policy Studies. In the last 11 months, the financial industry’s 170 billionaires (163 men and 7 women) added 27 percent, or $180 billion, to their total wealth. And much of the wealth of Wall Street is in the hands of private equity and hedge fund executives.

Often, the business model of these funds includes manipulating the stock market, burdening companies with excessive debt and laying off workers and cutting costs to service it, moving profits offshore to avoid paying taxes, or other extractive financial and legal engineering. In other words, much of this wealth flows from a broken financial system that’s rigged to reward Wall Street executives who extract wealth from working people and communities. The nation’s 664 billionaires have $4.3 trillion in total wealth. One in every five dollars controlled by these billionaires ($818 billion) is in the hands of people in the finance and investment sector.

Billionaire Wealth By Industry Sector

The Ultra-Millionaire Wealth Tax — a mere 3 percent of accumulated billionaire wealth — would net $25 billion in the first year from the financial sector fortunes alone, according to AFR calculations. Almost half that amount — $11.4 billion — would come from the top 15 richest finance moguls. Even among the very rich, wealth is concentrated among the super rich. (The Warren-Jayapal proposal, which includes a 2 percent levy on wealth between $50 million but less than $1 billion, would bring in around $3.0 trillion from 2023-2032, of which $0.4 trillion would come from the billionaire 1 percent surtax over that period.)

Warren Buffett and Michael Bloomberg, two Wall Street billionaires, have publicly endorsed a wealth tax plan in the past. They’re not the only billionaires asking to be taxed: 19 of them wrote an open letter to presidential candidates in 2019 with a similar request. For most Americans fortunate enough to own their own home, it is by far their greatest source of wealth, so in a sense, middle-class people already pay a wealth tax. The Ultra-Millionaire Wealth Tax would ensure that the super-rich pay taxes on all their assets, not just their New York mansions or Florida getaways, but their stocks, bonds, jewelry, sports cars, and art collections.

Wall Street Billionaire Wealth

There is bound to be loud and hostile opposition from the billionaires who will pay the tax.

When President Barack Obama sought to close the so-called carried interest loophole that benefits private equity executives, Stephen Schwarzman compared the move to the Nazi invasion of Poland. That step would have cost him about $100 million per year. Imagine how Schwarzman, with his $22.5 billion fortune, will react when the Warren-Jayapal wealth tax demands a payment to the U.S. Treasury seven times that size.

In 2019, Leon Cooperman, founder and CEO of hedge fund Omega Advisors, pushed back on Warren’s proposed wealth tax plan to the point where he broke down in tears on national television. Currently the 90th richest man on Wall Street, Cooperman would part ways with about $75 million — a small slice of his total wealth of $2.5 billion. The rest of us should shed no tears for him.

Wealth inequality

Get the facts

The truth is, the super rich consistently pay less than the rest of us. Overall, America’s billionaires control two-thirds more wealth than the 165 million Americans in the bottom half of the wealth distribution. The 400 richest Americans own more wealth than all Black households plus a quarter of Latino households combined. The tax system is so full of loopholes and special breaks that families in the top tenth of a percent pay about 3.2 percent of their wealth in taxes, while the bottom 99 percent pay about 7.2 percent in taxes. That’s right, the tax rate for the rest of us is twice as high as the tax rate for the super-rich.

Reducing wealth inequality may seem like a daunting task, yet Brandeis recognized that “most of the things worth doing in the world had been declared impossible before they were done.” The Ultra-Millionaire Tax is an important step toward reducing inequality and ensuring that the rich pay their fair share.

Inequality.org

—-

Bonus Video added by Informed Comment:

Bloomberg: “Warren Says Wealth Tax Would Help Raise $3 Trillion in 10 Years”

]]>
Taxes on the Rich: One-Sixth of What They Used to Be https://www.juancole.com/2021/02/taxes-rich-sixth.html Sun, 28 Feb 2021 05:03:58 +0000 https://www.juancole.com/?p=196387 By Bob Lord and Chuck Collins | –

( Inequality.org) – America hasn’t stopped taxing its wealthiest citizens entirely.

But that’s where we’re headed.

According to a new IPS briefing paper, the richest .01 percent of Americans, about 33,000 lucky souls today, now pay just one-sixth of what they used to pay in tax, when measured as a percentage of their total wealth.

The top .01 percent in America is a phenomenally wealthy group. Even during America’s most egalitarian periods, the average member of the top .01% held over 200 times the wealth of the average American. Today, the wealth of the average top .01 percenter is nearly 1,000 times that of the average American and is closing in on one billion dollars.

Hence, it doesn’t matter to the top .01 percent what type of tax they pay, be it income, sales, property or anything else. Taxes don’t influence their spending decisions or such mundane things as how many hours they work, when they retire, or whether their spouse must work. For a group whose poorest members are worth more than $100 million, the only impact any tax has is its impact on their wealth–and tax payments decrease the rate at which their wealth grows.

America’s radical tax transformation occurred over the last 65 years. The process started slowly between 1953 and 1980. It took 26 years for tax payments by the top .01 percent to fall by one-third from their 1953 peak. But starting in 1980, tax cuts for the wealthiest Americans have followed a clear pattern: When Republicans have held power, tax cuts for those at the top have been slashed; When Democrats have held power, they’ve enacted a few slight tax increases, but mostly have maintained the status quo.

The result has been a systematic shift in America’s tax policy, with taxes on wealth moving inexorably lower and taxes on work moving inexorably higher. As economists Emmanuel Saez and Gabriel Zucman have reported, the country has moved from a progressive tax system to one where the overall tax rate, as a percentage of income, is lowest for the very wealthiest of us. That’s bad enough. When we view the policy shift through the lens of taxation of wealth, as the IPS briefing paper does, it’s far uglier.

Effectively, taxes on the ultra-wealthy have nearly been eliminated. The members of the top 0.1 percent pay only one-sixth of what they paid a half century ago in taxes. What used to be paid every two months is now paid every twelve.

And there’s no sign this trajectory is changing.

Bob Lord is a veteran tax lawyer and an associate fellow at the Institute for Policy Studies. Chuck Collins directs the Program on Inequality and the Common Good at the Institute for Policy Studies, where he also co-edits Inequality.org.

Via Inequality.org

Content licensed under a Creative Commons 3.0 License

——-

Bonus Video added by Informed Comment:

Forbes: “Elizabeth Warren: We need a WEALTH TAX”

]]>
Facing Holiday Rush, Frontlines Retail Workers Urge Billionaire Bosses to Share the Wealth https://www.juancole.com/2020/11/holiday-frontlines-billionaire.html Mon, 30 Nov 2020 05:02:06 +0000 https://www.juancole.com/?p=194706 By Chuck Collins | –

( Inequality.org) – This essential workforce is hustling to help holiday shoppers while also organizing hazard pay and other COVID-19 protections.

This Cyber Monday, frontline essential workers will be hustling to help holiday shoppers — while also fighting for dignity, hazard pay, and other protections as COVID-19 infection rates spike again in many regions.

Rina Cummings, who works at the JFK8 Amazon Warehouse on Staten Island, feels like the billionaire owners are sending this essential workforce into the viral line of fire.

When she learned that the personal fortune of Amazon CEO Jeff Bezos had increased by $70 billion since the start of the pandemic, Cummings had just finished her ten-hour shift and was about to do another hour of MET (Amazon-speak for “Mandatory Extra Time”).

She remembers her response: “Jeez, maybe they could afford to give us face masks that reach our ears and don’t fall apart the moment they come out of the wrapper. What a piece of crap!”


Amazon warehouse worker Rina Cummings.

Amazon is one of the “Delinquent Dozen” featured in a new report, Billionaire Wealth vs. Community Health,” by Bargaining for the Common Good, the Institute for Policy Studies, and United for Respect. At these 12 corporations, owners and executives have reaped billions under the pandemic while their workers have struggled. As a whole, U.S. billionaires have enjoyed an increase in their personal fortunes of nearly $1 trillion since COVID-19 struck in March.

Back in 2018, when Cummings heard Amazon was coming to Staten Island, she jumped at the opportunity to work there.

“I totally drank the Kool-Aid,” she said. “I thought it was a great company. I even gave a little speech at work where I said I hoped my son would grow up and be like Jeff Bezos.”

But after six months, she started to see things differently.

“It was like The Matrix — and I took the pill that revealed the whole scary truth of how they squeeze their workers for every nickel,” Cummings said.

She soon connected with organizers at Make the Road NY and New York Communities for Change and began leading organizing efforts at the Amazon JFK8 plant. These groups, part of the larger United for Respect coalition, are pressing for hazard pay, paid family leave, and the creation of workplace health councils. They are also calling on lawmakers and the incoming Biden administration to legislate an Essential Worker Bill of Rights.

Cummings recounts that when the pandemic started, Amazon was slow to respond. “I went to work on March 29 and there were no masks or social distancing happening in the plant. I asked my supervisor for a mask. I mean we were selling them by the pallet. Sorry, no mask. I felt I was in a horror movie with a creepy soundtrack looking around our plant with hundreds of people, no one wearing masks.”

Cummings has children and elders and a medical condition, so she walked out that day. Amazon says she took a voluntary unpaid leave, choosing to quarantine. If she’d waited to get sick, she could have gotten a paid medical leave, but why take the chance? She kept her job.

“A lot of people were afraid to walk out, scared to lose their jobs or face retaliation. My view is standing up and speaking out is your safest bet.”

Cummings went back to work at the plant in July. There were better systems in place: a body scan at the door, masks provided and required for everyone, and monitors to make sure we follow safety rules. Amazon now staggers the beginning and end of shifts and breaks so people are not all bunched up together — but only by 15 minutes — so there’s still a lot of crowding, especially at the end of a shift.

She works on the shipping dock and runs a flat sorter, two big machines with a conveyor belt.

“I have to scan 1,800 packages an hour, that’s 30 scans a minute and 18,000 during a shift,” said Cummings. “The pace has definitely picked up during the pandemic. I have to work alongside another person and it is physically impossible to stay six feet apart.”

One of her co-workers died from COVID-19 in May and many others have gotten sick.

“We get a text whenever someone in the plant tests positive for COVID,” Cummings explained. “I’ve counted over 200 texts since I’ve returned to work. But it’s not very transparent about who the person is and where in the plant they work. Amazon basically says, ‘trust us and we’ll figure out who they had contact with.’ But it’s a big plant and unnerving to get a couple of these texts every week.”

With skyrocketing sales, Amazon can afford to invest more in their workers and worker protection. Cummings’s recommendations?

“What about hazard pay as workers go into this winter of higher risk? What about a dedicated express bus for Amazon workers coming to the plant? What about masks that don’t fall apart after an hour? How about a workplace council of frontline workers to give the company input into safety systems?

The Billionaire Wealth vs. Community Health report also recommends that Amazon and its billionaire owners be required to pay higher taxes to fund public transportation and public health protections for their employees.

Cummings wants to be clear that she doesn’t hate Amazon.

“I like my job and I like the company as a whole. We are getting our customers the things they urgently need during the pandemic. But Amazon could do a lot better by its workers. And I want to make it better.”

Via Inequality.org

Content licensed under a Creative Commons 3.0 License

—–

Bonus Video added by Informed Comment:

Euronews: “Black Friday: Amazon workers in Germany go on strike over working conditions”

]]>