Category: Allied Approaches

Organizers Oust Amazon HQ2 from New York

Negin Owliaei Co-editor, Inequality.org

Amazon offered New Yorkers the best possible Valentine’s Day gift — a breakup. The union-busting, deportation-aiding company announced it wouldn’t go forward with plans to build a new headquarters in Queens, financed in part by tax breaks and capital grants, thanks to the sustained organizing efforts from New York grassroots groups.

The announcement was welcome news to the coalition of organizers who demanded the city invest in its communities instead of trying to woo the richest man in the world. The coalition was made up of local community organizations, including groups like New York Communities for Change and Queens Neighborhoods United, tenants unions, immigrant groups like Desis Rising Up and Moving and Make the Road NY, and more.

They sprang into action soon after Amazon announced it would build two new home bases in New York and Virginia. “We won by standing firm with our stance on no concessions and united with other organizations and groups across the city with this message,” Shrima Pandey, an organizer with Queens Neighborhoods United, told Inequality.org in an email. “We made sure that our electeds knew we were not looking to make deals because we know you can’t make a deal with the devil.”

“We also won by rallying our people, by making sure everyone was informed of the disastrous impacts that HQ2 could have had in our borough and our city,” Pandey said. “We won by being committed to this campaign – we took early morning calls, and day-long meetings, and hit the streets in the bitter cold even though QNU is an all-volunteer group and our members bear many other responsibilities.”

The reaction to the Amazon deal was immediate as questions popped up over the incentives package proposed by New York officials. Why offer hefty tax subsidies when the city is failing to address record-high homelessness? Why offer to “assist in securing access to a helipad” (a real thing promised by the city to Amazon) while the public transit system was melting down? And why offer all these perks and incentives under a shroud of secrecy, without community input?

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Grifting the Working Class

Marc Dann
Former Attorney General, Ohio

Since the 2016 election, pundits have pondered how a man who began his campaign by gliding down an escalator in a gaudy Manhattan skyscraper festooned with his name managed to ride working-class resentment and anxiety to the presidency. How did a billionaire steal blue-collar Democratic voters right out from under Hillary Clinton’s upturned nose in broad daylight?

The answer will be obvious to anyone who, like me, has spent a career battling consumer fraud: they were conned.

And not for the first time. Trump, like all great con men, knows when a “mark” is ripe to be taken, but we often overlook how these same voters were hoodwinked first by Bill Clinton and then by Barack Obama. Their con games left  blue-collar voters ready to fall.

Really, who could blame them? They voted for Bill Clinton because he promised to reform health care and ban the use of scabs. Instead he passed NAFTA, which destroyed hundreds of thousands of jobs across the industrial Midwest. Clinton also rolled back banking regulation (with a lot of help from his successor George W. Bush), setting the stage for near-collapse of the global economy.

Then came Obama, who promised hope and change and delivered neither for actual workers. To stop the impending meltdown of the economy he funneled hundreds of billions of dollars to banks instead of the working families who were about to lose their homes. He doled out billions more to save General Motors but didn’t force the company to preserve American jobs—a failure that’s playing out with disastrous consequences at Lordstown and other GM plants across the country. And he also failed to keep his promise to streamline the union organizing process.

The policies of the last few decades left a nation littered with the broken dreams of blue-collar and middle-class workers struggling to cope with stagnant wages, home foreclosures, disappearing pensions, and vanishing opportunity. Trump knew instinctively they could be duped.

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How Failing Capitalist System Is Allowing Amazon to Cripple America

Paul Buchheit

Paul Buchheit Author, editor, expert on income inequality

Capitalism is failing in America, and Amazon is both the cause and beneficiary of much of the breakdown. Jeff Bezos said, "We've had three big ideas at Amazon that we've stuck with for 18 years, and they're the reason we're successful: Put the customer first. Invent. And be patient." He might have added three capitalist practices familiar to his company: (1) Pay no taxes; (2) Drive competitors out of business; and (3) Exploit workers. 

Anarcho-Capitalism: The Sordid Details of Amazon's Tax Avoidance 

In 2018, according to its own SEC filings, Amazon claimed a refund on its $11 billion in U.S. profits. It did the same on nearly $6 billion in profits in 2017. The company has reportedly positioned itself to avoid even more future taxes with unspecified tax credits. 

In the most extreme form of capitalism taxes do not exist. This is called "anarcho-capitalism." Among all corporations, Amazon may be the leading advocate of this philosophy. They haven't paid federal income tax for the past two years. They set up headquarters in Luxembourg for tax breaks that are now being challenged. They claim minimal profits on hundreds of billions in revenue, resulting in one of the lowest profit margins among major corporations, and thus much less tax. Of course, Amazon claims to be using tax credits from past losses that stemmed from investment in research and development (R&D). But the company appears to overstate and obfuscate the R&D numbers. Its only 'explanation' of R&D in its annual report comes in an ambiguously all-encompassing section called "Technology and Content." Plus, that's no excuse to dodge taxes. Walmart and Google each spent nearly $12 billion on technology in 2018, almost as much as Amazon, but Walmart paid 28 percent in federal taxes, and Google 14 percent. 

We learn much more at the state level. Amazon has played one state against another for tax breaks over the years, most recently negotiating an estimated $3 billion tax credit from the state of New York before residents rebelled—as well they should have. The Economic Policy Institute found that employment levels don't significantly change in communities with new Amazon warehouses, and a recent study by The Economist concluded that the opening of a fulfillment center in a given community actually depresses warehouse wages. Furthermore, as an indication of the folly of wooing corporations with state subsidies, Upjohn research found that in the great majority of cases incentives are not even a part of a company's decision to locate in a given area.

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Trump’s economy is leaving his right-wing base stranded in poverty — and it’s only going to get worse

Robert Reich

Robert Reich Former U.S. Secretary of Labor, Professor at Berkeley

You’ve heard me talk about inequalities of income and wealth and political power. But another kind of inequality needs to be addressed as well: widening inequalities of place.

On the one hand, booming mega-cities. On the other hand, an American heartland that’s becoming emptier, older, whiter, less educated, and poorer. Trump country.

To understand what’s happening you first need to see technology not as a thing but as a process of group learning – of talented people interacting with each other continuously and directly, keying off  each other’s creativity, testing new concepts, quickly discarding those that don’t work, and building cumulative knowledge.

This learning goes way beyond the confines of any individual company. It now happens in geographic clusters – mostly along the east and west coasts in places like Seattle, San Francisco, Los Angeles, New York, Boston and suburban Washington D.C.

Bright young college graduates are streaming into these places, where their talents generate more value–and higher wages–together than they would separately.

As money pours into these places, so do service jobs that cater to the new wealth – lawyers, wealth managers and management consultants, as well as cooks, baristas and pilates instructors.

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Fox News tells Americans to stop complaining about their shrunken tax refunds

Josh Israel

Josh Israel Senior Investigative Reporter, Think Progress

As Americans begin to prepare their 2018 federal tax returns, many are facing the unpleasant surprise that their tax refunds will be smaller this year or that they may even owe money to the government. This comes despite — or perhaps because of — the tax bill passed by the Republican Congress in late 2017 and signed by President Donald Trump, which Trump falsely promised would give everyone a tax cut, but actually raised taxes on many middle class Americans.

On Wednesday, Fox & Friends attempted to spin the situation, blaming taxpayers who should have somehow known to have adjust their withholding a year ago and should have saved more.

Noting that the average tax refund has dropped 8.4 percent since last year, guest and Fox Business Network host Charles Payne claimed Americans should have used their “fatter paychecks” more wisely.

“Here’s the thing. For the most part, the IRS is telling everyone that they just simply did not make the proper adjustments on the withholding at the beginning of the year. So they have been making all of this money,” he said.

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2 Millionaire Senators Introduce Plan to Ensure Congress is Only for the Rich

Ian Millhiser

Ian Millhiser Senior Constitutional Policy Analyst, Think Progress

Let’s start this column off with a bold assertion. Paying lawmakers good salaries is one of our country’s most important progressive reforms because it means that they don’t have to be wealthy to serve. High congressional pay is a safeguard against corruption, not a sign of it.

Bear this assertion in mind as you consider this proposal.

Scott’s net worth was $232.6 million at the end of 2017 — not bad for a man who led a company that paid $1.7 billion in fines for widespread Medicare and Medicaid fraud. His co-sponsor, Sen. Mike Braun (R-IN), is worth between $35 million and $96 million, according to his campaign disclosure forms. So Scott and Braun can afford to forego their pensions — or their entire salary, if they choose.

Yet, if elected officials do not receive what Scott dismisses as “generous salaries and pensions,” that will discourage people who do not have Scott or Braun’s vast wealth from running for office. As future President John Adams once warned, if “you make it law that no man should hold an office who had not a private income sufficient for the subsistence and prospects of himself and family,” then “all offices would be monopolized by the rich, the poor and the middling ranks would be excluded, and an aristocratic despotism would immediately follow.”

The question of whether to pay lawmakers was hotly contested by the framers — as historian Gordon Wood writes, the ultimate decision to do so “was radical for the age.” Many prominent early Americans subscribed to what Wood labels the “classical republican” view, which saw public service as a burden that should be carried without remuneration.

“In a virtuous government,” Thomas Jefferson claimed, “public offices are, what they should be, burthens to those appointed to them, which it would be wrong to decline, though foreseen to bring with them intense labor, and great private loss.”

Jefferson, of course, was a wealthy slave owner.

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AAM Letter to Congress: Oppose Toomey-Gallagher Anti-Section 232 Legislation

Cathalijne Adams

Cathalijne Adams

Congress must stand against a bill that threatens to weaken U.S. national security and endanger thousands of jobs fomented by the current Section 232 trade actions, Alliance for American Manufacturing President Scott Paul wrote to Members of Congress on Tuesday.

The proposed legislation, named the Bicameral Congressional Trade Authority Act of 2019 and introduced by Sen. Patrick Toomey (R-Pa.) and Rep. Mike Gallagher (R- Wis.), would eliminate a crucial trade enforcement tool just as the domestic steel and aluminum industries find their footing following years of import dumping.

In the past several days alone, U.S. Steel announced the restart of operations at a previously idled steel mill in Lone Star, Texas, and construction at another mill in Fairfield, Ala., collectively adding 190 new jobs that will support not only workers and their families but also the communities surrounding the mills.  

Section 232 trade actions have been vital to this recent economic growth in Lone Star, Fairfield and other communities around the country. Indeed, U.S. steel attributed its Fairfield restart to President Donald Trump’s “strong trade action”, which has helped the company, along with other steel and aluminum manufacturers and the workers they employ, recover from years of punishing damage due to import dumping.

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Future of Unions Conference Speakers Push Sectoral Bargaining

Mark Gruenberg

Mark Gruenberg Editor, Press Associates Union News

What was supposed to be an intellectual weekend conference on the future of the U.S. union movement turned into a conference on the future of collective bargaining, and specifically promotion of sectoral bargaining, instead.

The Feb. 8-9 confab in D.C., hosted by the Albert Shanker Institute – a think-tank the Teachers (AFT) set up – and the Century Foundation saw a wide range of speakers, both from the U.S. and abroad try to tackle the issue of how U.S. unions could reverse their long downward slide in the private sector.

That slide has taken U.S. private-sector union density to 6.4 percent, according to the latest federal figures – and set unions’ right-wing foes, their corporate class cronies and their political puppets free to go after public-sector unions now.

So far, despite some small losses, they haven’t succeeded, leaders of the four top public sector unions – AFT President Randi Weingarten, AFSCME President Lee Saunders, Service Employees President Mary Kay Henry and National Education Association Vice President Becky Pringle – said in a separate panel.

That’s despite a hostile U.S. Supreme Court which, in last year’s Janus decision by the court’s five-man GOP-named majority, made every public worker in the United States eventually a potential “free rider,” eligible to use union services and gains without paying one red cent for them.

That left speakers wrestling with the question of revitalizing and expanding private-sector union density. While the conference was not designed to come to a conclusion, but instead to float and discuss ideas, said Leo Casey of the Shanker Institute, sectoral bargaining came to the fore.

But it isn’t the only way private-sector unions could expand:

• Many speakers, including Weingarten, Communications Workers President Chris Shelton and Rep. Pramila Jayapal, D-Wash., argued that “bargaining for the community” – by putting community causes at the head of the workers’ demands – leads to more worker power.

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U.S. Unions Bring Solidarity to Striking Mexican Workers

By Ben Davis, USW

A delegation of union leaders from the national AFL-CIO, the Texas AFL-CIO, the UAW and the United Steelworkers (USW) traveled to Matamoros, Mexico, last week to support tens of thousands of factory workers who have launched a wave of strikes to demand wage increases and democratic control of their unions.

Since Jan. 25, at least 48 factories that produce auto parts and other goods for export to the United States have signed agreements to increase wages by 20% and pay a bonus of 32,000 pesos (about $1,750). This is a huge victory for the workers, most of whom make around $2 per hour. In the past week, the strike wave has spread beyond the factories to supermarkets and other employers, with all the workers demanding "20/32." The leaders of the Matamoros unions, which historically have been close to the employers, were forced to endorse the workers’ demands.

The delegation visited the picket line at Advanced Scientifics, a subsidiary of Massachusetts-based Thermo Fisher Scientifics, which produces medical supplies. Some 70 workers have been camped outside the plant 24 hours a day in near-freezing temperatures.

"It’s heartbreaking to see workers who make life-saving equipment treated with so little respect," said USW District 13 Director Ruben Garza. "This is what happens when we sign trade agreements like [the North American Free Trade Ageement] that have no real protections for workers’ rights."

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Amazon HQ2: Texas Experience Shows Why New Yorkers Should Be Skeptical

By Nathan Jensen, Professor of Government, and Calvin Thrall, PhD Student in Business and Development

New York offered Amazon close to US$3 billion to build a “second” headquarters in Long Island City on the promise of 25,000 jobs.

Since the deal was joyfully announced in November, however, many local residents and some politicians in the area have been questioning whether it’s worth it, both in terms of the price tag and the impact on housing and traffic congestion. There’s now a real possibility that the deal could be blocked, and Amazon itself is reportedly reconsidering the move.

The research supports those who question the wisdom of cities and states incentivizing economic development. Studies suggest the jobs and economic gains are usually not worth the tax breaks since the majority of companies would have come even without incentives.

And that’s when the companies try to live up to the promises they made. They don’t always do so, with the latest example being Foxconn’s announcement that it is reconsidering plans to build a factory in Wisconsin – less than a year after agreeing to create up to 13,000 high-tech jobs in exchange for more than $4.5 billion in incentives.

But how often do companies that agree to build factories and create jobs in exchange for economic incentives back away from their promises? And when they do, do taxpayers ever learn about it?

To shine light on these questions, we conducted a study of a Texas economic development program. Taxpayers in any American city considering luring a company with cash should take heed.

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Union Matters

The Call for a General Strike

Richard Cucarese

Richard Cucarese Rapid Response Coordinator, USW Local 4889

It’s been only a few weeks since Labor pushed back against the longest, most punishing government shutdown in recent history, but sadly, over the jubilant cheers of victory, the ominous drumbeats of Congress warring in the trenches could be heard again, leaving 800,00 AFGE members pondering if they’ll be furloughed once more.

President Trump’s decided that the ‘Wall to Nowhere’ will be the hill to die on in this inane battle of attrition, government workers livelihoods be damned.  Keeping this in mind, the ominous question should be how much longer will it be before Trump and the entitled imperialists of D.C. realpolitik turn their sights towards millions of American workers, over 40% of whom, according to CBS News data, are one missed paycheck away from poverty?

As we suffer under the grim reality of decades long wage stagnation, no calls for a realistic minimum wage increase to keep the One Percent’s vulture bankers from our doors, nor a social program of Medicare For All, easing the burden of burgeoning medical costs overrunning the populous meager discretionary incomes, the powers that be seem more than willing to shutter government again, leaving scores unemployed, airport safety and security in perilous shape and costing the taxpayers $3 billion to do so.

And while Congress apparently shows no guilt spending an inconceivable $1.45 trillion dollars for 2018/19, to voluntarily spill blood in every conceivable corner of the globe promoting crony capitalism, strong armed acquisition of natural resources and the continuation of imperialistic follies, the long suffering American worker is left sifting through the rubble, limping through countless miles of crumbling infrastructure, closed factories, failing schools, bankrupting college loan payments, mass shootings and scores of broken dreams, leading to shortened life expectancy, drug overdoses and suicides.

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Let's Talk About Wealth

Let's Talk About Wealth