Three Strikes and You’re Out

All is not sunshine for local laborers in the workplace vineyards of sunny San Diego. Local employees at three of the nation’s largest grocery chains are threatening a strike over wages and benefits. California State University professors are threatening rolling walkouts because they haven’t received a pay raise in years. So what do college professors and supermarket checkers have in common? Both represent laborers left sinking in the same leaky economic boat. And both are indicative of the unprecedented rise in San Diego—and America—of an hourglass economy.

An hourglass economy is one in which there are lots of lower-paying (though not necessarily low-skill) jobs and higher-paying jobs but fewer of the middle-class, middle-income jobs that used to span the gap between skilled blue-collar and high-level, white-collar professional jobs. So what’s the big deal? Plenty. During the heyday of the American middle class (from the end of WWII to the stagflation of the 1970s), the country had a diamond-shaped economy: growing middle income jobs with fewer low- and high-end ones. Such an economy is essential to democracy: The broad, satisfied middle class is able to outweigh the more reactionary tendencies of both poverty and great wealth.

The triumph of the American middle class after the war resulted in a fundamental change in politics and society. In 1929, the top 1 percent of Americans controlled more than 35 percent of the wealth. By 1976, they controlled less than half that. The number of Americans living in poverty—especially seniors—fell by more than half. And the middle class grew fat and happy, owning homes and cars while sending their kids to affordable colleges, content in the knowledge that the political classes in Washington feared them more than any other power on earth.

Since then, poverty rates—especially among children—have climbed. Middle-class wage and wealth growth has decreased: Where it used to take a generation to double an average family’s standard of living, it now takes the better part of three. And the rich are richer than ever, with the top 1 percent controlling more than 40 percent of the wealth.

The most significant aspect of our emerging hourglass economy is that, even as the economic top is pulling farther away from the bottom, the tippy-top is pulling farther away from everyone. Stockbrokers, money-managers and CEOs become superrich while college professors, doctors and other professionals struggle to stay in the upper middle class. This ultimately ends in the classic pyramid economy of the pre-democracy era: a small group of the superrich organizes politics and economics to continue to feed wealth to them at the expense of everyone else.

We are in an age where capital—the saved value obtained from other people’s labor—is valued far more than the labor (or laborer) itself. Those who generate capital are venerated and rewarded disproportionately more than those who simply do the honest day’s labor upon which our day-to-day society is dependent.

The problem is, neither college professors nor grocery cashiers add much short-term capital to the system. Sure, both spend their paychecks in the local economy. Both add the value of their labor to the overall economy—educated students who become part of a more efficient workforce in the former case, efficient and cheaply distributed food freeing up wealth to be spent or invested elsewhere in the latter.

But in today’s über-capitalism, the rewards of the system increasingly go to those who make more money for a small number of other people, no matter what the long-term social or economic cost. That’s why CEO pay has gone from 40 times that of an average worker a generation ago to 500 times more today. Are CEOs now 10 times more productive than a generation ago? Of course not. But they do generate far more wealth for a handful of people than they did a generation ago. That’s why today’s star athletes and movie stars rake in such big bucks. Tiger Woods gets paid $80 million a year not because he can hit a little white ball oh so sweetly, but because he generates hundreds of millions in sales and profits for those who pay him.

Did SLM Corp.’s Thomas Fitzpatrick (highest compensated CEO in America last year: $39 million) work a thousand times harder than a single mother working full-time as a Vons cashier? Indeed, the most highly rewarded cannot even claim they do their jobs better than everyone else. Most studies of CEO compensation find absolutely no correlation between CEO pay and performance. Ditto many superstar athletes, who rake in big bucks in advance of delivering on the court or field.

What the highly rewarded can claim is that they make other people—the 1 percent of people who profit most from the system—megatons of money. College professors and grocery workers make their livelihood exchanging a skilled service for their daily bread, helping thousands to live their daily lives better but making no one rich in the process. Our current economy simply does not value such labor that much.

So the moral of our two-strike dilemma is simple: In today’s emerging hourglass economy, the American middle class is going down for the count.

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Locals

The local unions are gearing up for active warfare, with strikes looming from the grocery store to the college campus. I just received this missive from my own union president, Jim Mahler, of American Federation of Teachers local 1931. (Yeah, I’m a union guy. Gotta problem wi’ dat?) If you ever wondered why shopping at locally owned stores matter, this should tell you why:

Three years ago the supermarket chains locked out their workers for 141 days in an effort to break the union.  While the UFCW survived the lock-out and saved benefits for current employees at the time, the chains insisted on and got a two-tier wage system that imposed massive wage and benefit cuts on new employees.  

The argument at the time was that Wal Mart and Costco were increasing market share and that the two-tiered system was a necessity to save Ralphs, Vons and Albertsons from being overwhelmed by their big box competitors.  Living wages and family benefits, the chains claimed, were simply economic impossiblilties.  

Three years later, that assertion has been proven wrong as the market share of Wal Mart and Costco has actually decreased since the current contract was signed.  Despite this development and the fact that Ralphs, Vons, and Albertsons are raking in record profits of $3 billion each, the chains are still refusing to eliminate the two-tiered system in the new contract.  In contrast, Stater Brothers, with an annual profit of $26 million found that it was possible to eliminate the two-tiered system and give their employees wage and benefit increases.

It is clear that Ralphs, Vons, and Albertsons, with their much larger profits can afford to treat their workers with the respect and dignity they deserve and eliminate the two-tier system which will eventually transform what were once solid blue collar jobs into yet another dead end for the working poor.  It will also add to the ranks of the millions of Americans wtihout affordable health care coverage.  As public sector union workers with good health care, job security, and pensions, it is our moral obligation to support our union (and non-union) brothers and sisters who are struggling to save living wage jobs with health benefits in what has become an increasingly hostile economic environment for working and middle class American families.  

Couldn’t have said it better myself. Coming up I’ll explain why college professors have much more in common with grocery workers than with CEOs,, and why CEO’s have more in common with superstar athletes and rockstars than with the rest of us average mortals. And it has nothing to do with education, personal effort or moral fortitude.

Shock and Awe

I greeted the Peters/Young plan to reach a compromise with City strongman mayor Jerry “I’ll cut it if I want to” Sanders with a combination of shock and awe. Shock that the council leader is actually making a reasoned overture to the Mayor after a plethora of mean-spirited platitudes that have been exchanged between the two over the last several weeks. And awe that such a reasoned proposal for civic harmony might emerge from our usually dysfunctional municipal family.

So I say, “Bravo,” one and all. With two little teeny-tiny exceptions.

First, a technical note. While the idea to grant Gentleman Jerry unilateral authority to shift around monies up to 10% of the budget or $4 million dollars is actually too generous a concession by the Council. My original beef with the Council plan to strip the Mayor of any budgetary discretion was that it was an ill-conceived usurpation of Mayoral authority. If the Council wanted to protect explicit programs they need to detail that portion of the budget down to the departmental object code level and not just lazily protect everything in the budget from Mayoral oversight.

The downside of the current proposed compromise is that it now allows the Mayor carte blanche authority over any and all City programs without the right of the Council to protect those programs and services that they deem should be preserved and protected.

So my compromise to the compromise would be to insert the phrase “unless otherwise specified in the Budget by a majority of the Council” or some such legalese that would preserve to the Council the right to identify key programs as, effectively, “untouchable” by the Mayor’s discretionary axe. As long as the Council is willing to do the hard thinking ahead of time to identify which programs are really essential in their minds, it is their authority and right to put such protections into the budget.

The rest? Swing that axe of budgetary restraint, Jer’.

My second quibble, it breaks my heart to say, is with Darling Donna, my erstwhile champion of public interest on the Council. There is sometimes a fine line between being principled and obstructionist and, on this issue, I think Donna is pushing that line. The bottom line here is that the City’s voters did approve a Strong Mayor system (flawed as the current language of the provision may be—same number of council votes necessary to overturn the Mayor’s veto of a council action as is required to pass such action? Please.) and, as such, she needs to recognize that the traditional power balance has been changed. As per my discussion above, is she is not willing to put the extra effort in to identify in advance what parts of the budget are important to her, she can’t do so post facto to the passage of the budget.

So Donna, let this one go. Support the compromise with my compromise attached. That should satisfy everyones’ concerns

Silence of the Lam

Former US Attorney Carol Lam apparently left both her anti-corruption caped crusader cape and her tongue at home today when she testified today before Congress about her abrupt dismissal.

Too bad.

Lam was fired, ostensibly, for being soft on illegal immigration, which is pure hooey. Even the Justice Department’s own internal documents vouched for Lam’s efficiency in prosecuting both corruption and illegal immigration cases. To the casual or informed observer, based on what the public has been told to date, reasonable minds can only suspect ulterior motives in her removal. Heavy-handed, hairy-handed motives, for that matter.

But Lam remains silent.

When asked by KPBS whether or not the investigations she initiated into the web of corruption that was the Republican Congress, she answered, “I’m neither a soothsayer, nor a fortune teller but I expect the Department of Justice will conduct itself as the department always has and as professionally and in the public’s interest.”
http://www.kpbs.org/news/local?id=7404

Come on Carol. If the big political honchos at the DoJ were acting in the public interest, would you have been sacked in the first place?

I’m glad someone as talented and effective as Ms. Lam has landed on her feet with a good sinecure at Qualcom. But I beseech her, on behalf of the public she so valiantly served, to perform one last act of public service.

Dear Ms. Lam: If you suspect—and I mean one smidgen of an iota’s worth–that you were forced out for political reasons, say so. Don’t be loyal to an administration that was not loyal to you. And was not loyal, if indeed your firing was political motivated, to the American people.

Don’t be a silent lamb at a political slaughter.

Oh, and Congressman Darrell Issa – a quick reality check. Which really is the greatest threat to our democracy: illegal immigrants who pay through the nose to sneak into our country to clean our toilets and pools or white collar Congressman who make us pay through the nose as a consequence of their own corrupt practices? Before you criticize Carol Lam, have a good answer to that question in hand, will ya.

Holes

Today’s These Days was surprisingly fun to listen to: the battle of the think tank brains. (What South Park could do with that concept…) The ideological catfight pitted Don Cohen of the liberally leaning Center on Policy Initiatives against STeve FRANCIS of the City representing his new San Diego Institute for Policy Research conservative think tank . Go to These Days podcast to download. Listen and chuckle as Francis argues he’s not a Republican shill. Cohen, to his credit, owned up to his progressive-liberal credentials.

The only thing I took real exception to was the oft repeated canard that “There is no Republican or Democratic way to fill a pothole” in reference to local politics supposedly being nonpartisan.

Au Contraire.

The Democratic way to fill a pothole is to have the City do it using unionized, city workers paid a living wage and receiving livable benefits.

The Republican way to fill a pothole is to have the City do it by outsourcing it to the private contractor responding with the lowest bid irrelevant of worker wages and benefits.

The Libertarian way to fill a pothole is to have the guy whose house the pothole is in front of come out and fill it.

The Fascist way to fill a pothole is to shoot the people who made the pothole and conquer a neighboring country to turn their people into slave laborers to fill the pothole.

The Socialist way to fill a pothole is to nationalize all cars and regulate how often they can be used to avoid future potholes.

The Communist way to fill a pothole is to kill all the car owners and meltdown all cars so that every proletariat worker may receive an equal portion of the recast blocks of metal and plastic.

The Anarchists way to fill a pothole is to blow up the rest of the road.

Meanwhile….

The Bush Administration’s way to fill a pothole is to invade Iraq and bring democracy to the Middle East.

The Democratic Congress’ way to fill a pothole is to vote a non-binding resolution opposing potholes.

The Republican Congress’ way to fill a pothole is to vote for tax cuts for the rich and business deregulation.

The Catholic way to fill a pothole is to declare bankruptcy.

The Nihilist way to fill a pothole is to deny the existence of the pothole.

The Buddhist way to fill a pothole is to be the pothole.

Anti-Globalizationists way to fill a pothole is to trash a Starbucks.

The Multi National Corporation way to fill a pothole is to outsource the job to a call center in India.

MicroSoft’s way to fill a pothole is to steal a solution from the Mac operating system.

Mac’s way to fill a pothole is to design roads so potholes simply can’t occur.

Dick Cheney’s way to fill a pothole is to take it quail hunting.

Rush Limbaugh’s way to fill a pothole is to blame it on whacko liberal democrats.

Hillary Clinton’s way to fill a pothole is to oppose the pothole while not opposing all holes in general.

Bill Clinton’s way to fill a pothole…we won’t go there.