| LEADING STORIES INSIDE…
Labor Secretary Solis resigns; Union leaders laud her service (+)
Fletcher: Labor must change to survive or ‘We’ll be history’
Letter Carriers: Federal report on Postal Service
reiterates old stand for huge health care prepayments (+)
Kentucky AFL-CIO, allies unveil report linking
GOP filibusters to McConnell campaign cash (+)
ATU commends administration for ordering bus firm off the road after fatal crash, but says feds avoid the real problem, fatigue
NLRB orders employers to reimburse workers for taxes on backpay awards
Minnesota unions urge action on jobs, revenue as legislature convenes
Historian: Labor movement in mid-20th century in tradition of abolitionists (+)
Story on McDonald’s income gap wins monthly Hillman Award
Washington Window: Closing tax loopholes…er, truckholes
Op-Ed: The Bush tax legacy lives
Labor news around the nation
Outcome of the union recognition vote at American Airlines
RWDSU racks up two notable wins in New York
(+) after headline indicates accompanying photo, chart or graphic
Press Associates, Inc. (PAI) – 1/11/2013
SOLIS RESIGNS; UNION LEADERS LAUD HER SERVICE
By Mark Gruenberg, PAI Staff Writer
WASHINGTON (PAI)—Labor Secretary Hilda Solis, who repeatedly declared herself “the new sheriff in town” on behalf of workers the last four years, resigned her position on Jan. 9, after talks with her family over the holiday break about her future.
AFL-CIO President Richard Trumka and other union leaders praised Solis for standing up for workers and coming down hard on corporate violators, especially in job safety and health. “Hilda Solis brought urgently needed change to the Department of Labor, putting the U.S. government firmly on the side of working families,” Trumka said.
“Under Secretary Solis, the department became a place of safety and support for workers. Secretary Solis’ Department of Labor talks tough and acts tough on enforce-ment, workplace safety, wage and hour violations and so many other vital services.
“Secretary Solis never lost sight of her own working-class roots, and she always put the values of working families at the center of everything she did. We hope her successor will continue to be a powerful voice both within the Obama administration and across the country for all workers,” Trumka concluded.
There was no immediate word on whom Democratic President Barack Obama would nominate to succeed Solis, 55, a former congresswoman from Los Angeles. Solis said she would return to Los Angeles, but did not disclose her future plans.
One news report said Solis would seek election to the powerful Los Angeles County Board of Supervisors. L.A. County is the most populous in the U.S. And the job of Mayor of Los Angeles – the nation’s second-largest city – will be open. Incumbent Antonio Villaraigosa, 60, is term-limited and must step down this year.
In a speculative article around last November’s election, National Journal, an authoritative weekly magazine covering the executive branch, said Steelworkers President Leo Gerard was union leaders’ favorite for the job should Solis leave.
Another story on Solis said veteran Rep. Rosa DeLauro, D-Conn., was runner-up for the post when Solis got it four years ago. DeLauro is top Democrat on the House appropriations subcommittee that helps dole out money for DOL and related agencies.
The name of Patricia Smith, the Labor Department’s Solicitor – its top lawyer – and a former New York State Labor Commissioner, surfaced in yet another story. And a columnist for the Right Wing Washington Examiner said Obama “cut to the chase” and nominate Trumka. The pundit snidely said Solis always did the AFL-CIO’s bidding.
In her resignation message, Solis thanked the department’s workers. She added that together they helped implement the Obama administration’s recovery measures from the Great Recession and stepped up job retraining and labor law enforcement in safety, health and wage and hour areas.
“We also played an important and active role in crafting regulatory actions to implement key aspects of the Affordable Care Act. Our work will help make President Obama’s vision of a health care system that works for America a reality for millions of people,” she said.
Other leaders praising Solis’ service and saying they would miss her included Teamsters President James Hoffa, Communications Workers President Larry Cohen, AFSCME President Lee Saunders and Service Employees President Mary Kay Henry.
Hoffa termed Solis “a strong advocate for working families throughout her entire public career. As the daughter of a Teamster shop steward, she learned early in life the value of a strong labor movement.
“As secretary, she has worked diligently to create a department that protects workers and ensures that we have the strongest workforce in the world. I want to thank Secretary Solis for everything she has done over the past four years at the Labor Department to help working men and women achieve fairness and dignity on the job.”
Cohen called Solis “an incredibly effective advocate for working men and women.” He said the union “will miss her voice and her determination to ensure working people have not only opportunity, but justice. CWA has been a proud partner of Secretary Solis, and we wish her and her family all the best for the future."
Saunders said unionists “are grateful for Secretary Solis’ extraordinary commit-ment to working men and women. At a time when powerful, moneyed forces have come together to pursue a virulent, anti-union agenda, she focused the department’s attention on putting Americans back to work, making the workplace safer and healthier, and protecting and preserving the rights of union members and working families. Secretary Solis is an ally, a friend and a tireless advocate.”
Henry had similar sentiments, speaking for SEIU’s 2.1 million members: "Secretary Solis served as a true champion for working people during her tenure. She was an unwavering supporter of workers' rights and is the embodiment of the type of public servant our country needs. She led the way to expand access to job training programs and fought to get hundreds of thousands of workers' their deserved back pay, among other significant accomplishments,” Henry said. SEIU gave Solis “a heartfelt thank you,” Henry concluded.
LETTER CARRIERS: FEDERAL REPORT ON POSTAL SERVICE REITERATES OLD STAND FOR HUGE HEALTH CARE PAYMENTS
WASHINGTON (PAI)—A new federal report on the financial ills of the U.S. Postal Service (USPS) is a reiteration of previous justifications for huge agency prepayments of future retirees’ health care costs, Letter Carriers President Fredric Rolando says.
And the Postmaster General and congressional GOP foes of unions use those billions of dollars in congressionally ordered red ink as excuses to justify the proposed firing of 100,000 postal workers, the retirement by attrition of 100,000, elimination of
Saturday delivery and – at an extreme – destruction of union contracts, NALC and other postal unions have said before.
Rolando commented on the latest report, issued last month by the non-partisan Government Accountability Office (GAO). It analyzed five solutions for the USPS’ financial ills . One – the most extreme – was authored by House Government Reform Committee Chairman Darrell Issa, R-Calif., who requested GAO’s report.
The 112th Congress ducked the issue of what to do about USPS, leaving the new Congress to tackle the problem all over again.
Issa’s plan to reform the USPS would fire the workers, appoint a czar to run the agency, let him tear up the union contracts and cut benefits, eliminate Saturday delivery and slow first-class mail nationwide. Issa also would drive up the USPS health care prepayments, from $55 billion to $82 billion, spread over several decades, GAO said.
GAO also rejected USPS reforms that NALC proposed, including expanding the agency’s lines of business. It said those would be inadequate to stanch USPS red ink.
GAO’s report “fails on two counts, and Issa's attempt to use it for his own ideological aims is disingenuous,” Rolando responded.
GAO’s health care pre-funding advocacy is “new and not surprising. GAO is hardly a neutral party on pre-funding,” since its former director proposed that for all federal agencies, Rolando explained. “But Congress has chosen to apply it only to the Postal Service…Commitment to pre-funding at the Postal Service trumps every other policy priority -- such as giving the service a chance to restructure and adapt to meet evolving needs for 21st century postal services.
“Second, as even GAO acknowledges, the USPS should pre-fund to the extent ‘its finances permit,’” he noted. But the Great Recession sharply cut postal revenues and “the bill passed by the Republican majority and signed by (GOP) President George W. Bush contained no provision to deal with that economic turn-of-events.
“The result has been predictably disastrous. For the past half-dozen years, the Postal Service plowed its meager profits when they existed, emptied its bank accounts and exhausted its borrowing authority -- not to modernize its fleet of vehicles or to better serve small businesses, but instead to make pre-funding payments required of no other agency or company.
“Records show 80% of all the USPS red ink stems directly from pre-funding…For Issa to use a problem he helped create -- and which he refuses to fix or even acknowledge -- in an effort to downsize and destroy a popular and effective federal service is puzzling,” Rolando concluded. ###
KENTUCKY AFL-CIO, ALLIES UNVEIL REPORT LINKING GOP FILIBUSTERS TO McCONNELL CAMPAIGN CASH
LOUISVILLE, Kent. (PAI)—Senate Minority Leader Mitch McConnell, R-Kent., launched at least eight successful Senate GOP filibusters in the last Congress – including one talkathon blocking Democratic jobs creation legislation – at virtually the same time the senator garnered loads of campaign cash from special interests opposed to those measures, the Kentucky AFL-CIO and several allies report.
They cited a new study by the non-profit non-partisan Public Campaign Action Fund, which points out the success of the Republican talkathons in killing legislation that would have hurt those interests.
McConnell corporate donors who at the same time opposed the pro-jobs legislation included ExxonMobil, Hewlett-Packard and Koch Industries, the private oil-based conglomerate owned by the notoriously Right Wing anti-worker Koch brothers.
The groups released their report at a Jan. 4 press conference in Louisville just as the Senate debate over changing its rules to curb or halt such filibuster obstructionism is heating up. That day, before the Senate recessed for two weeks, Sen. Jeff Merkley, D-Ore., introduced a comprehensive filibuster reform effort that McConnell opposes.
Merkley’s reform is backed by the 51-group FixTheSenateNow.org coalition, organized by the Communications Workers and progressive allies. They’re lobbying to force the Senate to change its rules and curb ability of its minority – now, McConnell’s Republicans – to bring everything to a screeching halt via filibusters and threats.
"McConnell has been at the helm of a scorched-earth policy of blocking nearly every bill and nominee that comes before the Senate,” says the report, Cashing In On Obstruction. His filibusters “impose an anti-democratic super-majority requirement to advance any legislation or appointment.
“This has meant little to no work on a wide range of lingering problems from anemic job growth to unwarranted giveaways of tax dollars to oil companies to the highest rates of inequality since the Gilded Age.
“This links the big trends and donors in McConnell’s enthusiastic fundraising career with his willingness to foment legislative dysfunction, which serves to increase his power and enrich his corporate donors while leaving American families to struggle.”
One of the eight cases where McConnell filibusters dovetailed closely with checks from campaign contributors came when Senate Democrats tried to bring up their jobs creation package for votes in 2009-10 and 2012, the report says.
The Creating American Jobs and Ending Offshoring Act (S3816) would have granted a 2?year payroll tax holiday for every job brought back to the U.S., the report notes. It also ended corporate tax deductions for job creation overseas, especially for offshoring. And it would have killed firms’ ability to defer U.S. taxes on overseas profits, a tactic many big U.S. firms use to escape paying taxes entirely.
“But these provisions were stripped as this Senate bill failed cloture vote after cloture vote,” the report says, referring to the 60-vote hurdle needed to stop Senate filibusters. With 47 Republicans in the last Congress, McConnell had more than enough support in the 100-member Senate to win cloture votes and continue the talkathons.
Eventually, S3816 passed, with only extended jobless benefits, omitting provi-sions encouraging U.S. job creation and discouraging it overseas, the report adds.
“McConnell helped block all these recent efforts to bring jobs back to the U.S., looking out repeatedly for his large corporate donors and opponents of these measures, including the National Association of Manufacturers and the U.S. Chamber of Commerce,” the report says.
“Taking the companies that lobbied on S3816 in 2010 as a sample, McConnell raised close to $1 million from executives and PACs (campaign finance committees) associated with 37 of the companies that reported lobbying on the bill in at least two of their filings” with the government.
McConnell gets 84% of his campaign cash from PACs and big givers and only 16% from individuals in Kentucky, the report adds. He has raised, enthusiastically, some $45 million for his elections in his career, not counting funds he’s already stockpiling for his 2014 race.
“The largest donor in this group” of 37 “is General Electric, giving at least $174,812 to McConnell over the years,” the report said. It’s followed by Microsoft ($100,750), Koch Industries ($85,450), and Exxon-Mobil ($74,300).
“These 37 companies have collectively stashed $445 billion (their emphasis) in untaxed profits overseas instead of using those funds to create jobs in America. GE, Microsoft and Exxon Mobil also stand out, with offshore profits of $102 billion, $61 billion, and $74 billion respectively.” Other firms that lobbied against the jobs law, gave to McConnell and sit on overseas profits include Johnson & Johnson ($42 billion abroad), IBM ($38 billion), and Hewlett-Packard ($29 billion),” the report adds.
“Congress isn’t working for Kentuckians but it is working for lobbyists and corporate interests,” Kentucky AFL-CIO President Bill Londrigan told the Louisville press conference. “McConnell has always put his donors’ interests before the needs of middle class families, but now he’s helped to grind Washington to a halt when we need someone on our side.”
Added Steve Wsideimsatt of IUE-CWA Local 761: “Let me put it clearly: Kentucky needs jobs and McConnell and his allies blocked legislation to create jobs here and around the country.” Local 761 represents IUE-CWA workers at General Electric, the top contributor on McConnell’s list among firms that opposed the jobs bill.
“Legislation opposed by his corporate funders would have ended the tax breaks they get by shipping jobs overseas. He pockets the campaign money from out-of-state donors and Washington lobbyists, and we’re left wondering whether we have anyone representing our interests in the Senate.”
A check of McConnell’s website disclosed no reaction to the report. His spokesman told the Associated Press at the time that the report was a “hack job” and called its sponsors “partisan and out of touch.”
STORY ON MCDONALD’S INCOME GAP WINS MONTHLY HILLMAN AWARD
CHICAGO (PAI)—An investigative story contrasting the minimum wage paid to a veteran worker at two Chicago-area McDonald’s outlets with the $8.75 million salary of the fast food firm’s CEO won the January Sidney Award, named for pioneering union leader Sidney Hillman. Leslie Patton of Bloomberg News won for “excellence in journalism in service of the common good,” the Hillman Foundation said.
Patton’s Tale of Two McDonald’s “shows how explosive growth of fast food generated fat profits for executives and shareholders at the expense of front-line workers, who have been left behind,” it added. Patton’s story contrasted 20-year fry cook Tyree Johnson, who grew up in Chicago projects, earning the Illinois minimum wage of $8.25 an hour, to company CEO Don Thompson, also of Chicago.
Johnson lives in a single room occupancy hotel with a shared bathroom and must wash in a McDonald’s restroom at the end of one shift so he can head to a second shift at another McDonald’s about a mile away. “‘I hate when my boss tells me she won’t give me a raise because she can smell me,’” the story added.
“The story was an important one to tell both about my beat and more broadly about growing income inequality. And the story was a part of a Bloomberg series that examined how the top earners in this country have gained more than in past economic recoveries as the rich-poor gap has widened,” said Patton. ###
ATU COMMENDS ADMINISTRATION FOR ORDERING BUS FIRM OFF THE ROAD AFTER FATAL CRASH, BUT SAYS FEDS AVOID THE REAL PROBLEM, FATIGUE
By Mark Gruenberg
PAI Staff Writer
WASHINGTON (PAI)—The Amalgamated Transit Union commended the Obama administration’s Transportation Department for ordering a charter bus company with prior safety violations off the road after a fatal crash in Oregon. But ATU says barring the firm still doesn’t attack the key cause of such crashes: Driver fatigue from overwork.
And the federal government has done little to attack that basic issue, union President Larry Hanley told Press Associates Union News Service. “The body count will grow until they” – Congress and the administration – “pay attention to the issue.”
The Federal Motor Carrier Safety Administration (FMCSA), the DOT agency that regulates bus safety, suspended the operating permit of Canadian-based Mi Joo Tour & Travel after one of its buses plunged down an embankment off an Interstate in Oregon. The Dec. 30 crash killed nine people and injured 39 more.
The bus driver had toiled for 92 hours behind the wheel in the prior seven days, far above the maximum 70 hours that FMCSA rules allow. Overtime law does not cover such drivers. The Oregon crash was the latest fatal accident involving an overworked intercity bus driver. Other recent fatal crashes occurred in New York City and Virginia.
“How many more must die before the U.S. Congress and the Canadian Parliament address driver fatigue to protect bus drivers and the passengers they carry?” the union asked in a prepared statement. Overworked bus drivers, Hanley said, have become scapegoats for unsafe bus companies that operate “sweatshops on wheels.”
ATU issued a report last year documenting extensive driver fatigue and its direct relevance to fatal bus crashes. The report said non-union intercity bus drivers often must work long hours, as the Oregon driver did, to earn enough to feed their families. Those not spending extra hours behind the wheel, it added, must take second jobs.
“Bus drivers should not have to work the hours they do just in order to make a living,” Hanley told PAI. “And this doesn’t cover just fly-by-night operators, either.”
Congress and FMCSA have by and large ignored the ATU report. ATU is the largest union for city bus and rapid transit drivers, but also represents drivers on some major intercity carriers, such as Greyhound.
FMCSA said the bus firm sent its driver out on the road without proper rest. It also said the firm previously violated U.S. drug and alcohol testing standards. It called the firm’s operations “an imminent hazard” to passengers. ###
NLRB ORDERS EMPLOYERS TO REIMBURSE WORKERS FOR TAXES ON BACKPAY AWARDS
WASHINGTON (PAI)—The National Labor Relations Board has ordered employers to reimburse workers for excess federal and state income taxes they must pay on backpay awards they win in labor law-breaking cases.
In a Dec. 18 decision, agreeing to a proposal by the board’s general counsel in a case decided in July, the agency said the employer must repay the worker if the backpay awards stretch over more than a year.
The case, involving Teamsters Local 777 in Chicago, and the Latino Express school bus company, is important because employer delays often result in multi-year backpay awards to workers who lose wages, usually due to illegal firing.
When the workers finally win at the NLRB, or after employer appeals to court, the backpay awards can amount to thousands of dollars each, even after deducting all earnings from other sources that the workers garnered while awaiting the rulings.
The workers have been responsible for paying state and local income taxes on such net backpay awards. Now, the board says, the employer has to reimburse the workers for those excess tax payments.
Employers also must submit “appropriate documents” to the Social Security Administration so the workers’ backpay “will be allocated to the appropriate calendar quarters” for determining future Social Security benefits, the board ruled.
"The board previously severed these remedial issues,” says the newsletter from NLRB’s Chicago regional office, which handled the Latino Express case. The agency’s general counsel, its top enforcement officer, “filed a brief arguing both remedies were appropriate and necessary to make discriminatees (workers) whole.”
Friend of the court briefs, supporting employer responsibility for the hurt workers’ back taxes, came from the AFL-CIO, the Service Employees, the National Employment Law Project and several Hispanic rights organizations.
Meanwhile, Latino Express is still battling its drivers. The Chicago office had to issue a second complaint against the school bus firm in July for bargaining in bad faith – for 10 months – over a first contract for the drivers. An NLRB administrative law judge opened hearings on that charge in October, but recessed them to this year while some “procedural issues” were worked out, the regional office said.
MINNESOTA UNIONS URGE ACTION ON JOBS, REVENUE AS LEGISLATURE CONVENES
By Steve Share, Minneapolis Labor Review editor
ST. PAUL, Minn. (PAI)--When the Minnesota legislature convened Jan. 8, everything had changed -- and nothing had changed.
What’s changed: For the first time in a generation, the Democratic-Farmer-Labor Party (DFL) holds majorities in both the Minnesota House and Senate and also holds the governor’s office. What hasn’t changed: The state faces structural budget deficits that the last several legislative sessions have failed to address.
For the state’s labor movement, winning back labor-friendly majorities in both houses of the legislature means 2013 won’t bring a cascade of extreme anti-worker legislative proposals like the last two legislative sessions under Republican control produced.
It also frees state unions to concentrate on their top priorities for Minnesota said Jennifer Schaubach, Minnesota AFL-CIO legislative director: Legislation to increase revenue and to create jobs.
“This past election was a scream loud and clear,” she said.
Minnesotans voted for legislative candidates who promised an end to budget shifts and gimmicks and to raise revenues fairly to invest in the state’s future. As the state’s economy climbs out of the recession, “we still desperately need jobs,” Schaubach said.
The Minnesota AFL-CIO will support a significant bonding bill to invest in state infrastructure and create jobs and also will support legislation to facilitate expansion of the Mall of America in Bloomington. “With this legislature we have a generational opportunity here,” commented Harry Melander, president of the Minnesota State Building and Construction Trades Council.
Bonding for job-creating investments to build and maintain the state’s infrastructure continues to be a top priority for the building trades, he said. “We hope to see that there are measures to provide a long-term solution to transportation funding, including transit,” he added.
“We would like to see a fair means of providing revenue to the state that’s fair to all,” Melander said. “Smart, reasonable change needs to be the message,” he emphasized.
Many of the newly elected members of the DFL majorities campaigned on paying back funds shifted away from schools and urged making new investments in education.
“The November elections have given us a chance to catch up on a decade of underfunding our schools,” said Tom Dooher, president of Education Minnesota, the state’s teachers union, a joint affiliate of the National Education Association and the American Federation of Teachers.
“If we’re going to have strong communities, we’ve got to have strong schools — and that means investing in them from early childhood to higher education,” Dooher said. “Our schools should not be a piggy bank for the state’s general fund,” he added.
“We need to pay pack the debt we owe our schools,” agreed Julie Bleyhl, legislative director for AFSCME District Council 5. “We have a backlog of funding problems that past legislatures haven’t dealt with and have put off,” she said, noting that track record puts an extra burden on the incoming legislature. “We have a structural deficit. We need to fix that.”
“We also want to make sure that revenue is raised in a fair way and those that can afford — the millionaires — pay their fair share as well,” Bleyhl said.
“We pride ourselves in Minnesota with our schools, our higher education, our transportation systems, our health care, and we need to continue to make investments to assure we not only stay competitive but we succeed,” she said.
“The change with the majority party provides an opportunity to do positive things for Minnesotans, for working families, to improve the economy, and to improve public services and programs in the state,” Bleyhl said.
“Union members and working families need to continue to communicate with their legislators and their co-workers,” Bleyhl urged. “Continue to stress the importance of raising revenue and making investments in the state of Minnesota to provide for a prosperous future and move the economy forward.”
“The most important thing is getting people to work,” said Kyle Makarios, director of government affairs for the North Central States Regional Council of Carpenters.
LABOR NEWS AROUND THE NATION
HOUSTON (PAI)--Working America, the AFL-CIO’s affiliate for people who can’t join unions, opened its first Texas office on Jan. 9 in Houston. Its first campaign in union-hostile Texas will send organizers to mobilize people for Medicaid expansion there, now blocked by GOP Gov. Rick Perry. One in four Texans is uninsured. ###
HISTORIAN: LABOR MOVEMENT OF MID-20th CENTURY IN TRADITION OF ABOLITIONISTS
By Mark Gruenberg
PAI Staff Writer
WASHINGTON (PAI)—The labor movement of the mid-20th century – starting in the Gilded Age and running through the end of World War II – was in the tradition of the abolitionists, an energetic minority that worked in conjunction with an occasional progressive politician but mostly outside the political system, a noted historian says.
And labor ought to return to that outside-inside combo, even if there’s not an available White House occupant to take up the cause, adds Columbia University professor Eric Foner.
Foner, son of prominent union leaders and activists and a scholar of the Civil War, its causes and its impact, drew that conclusion during a Jan. 9 talk at the AFL-CIO about his new book, The Fiery Trial: Abraham Lincoln And American Slavery. His talk commemorated the 150th anniversary of the Emancipation Proclamation, plus Dr. Martin Luther King’s birthday and the inauguration. The latter events occur on Jan. 21.
Foner said that like the abolitionists, whose views were eventually embraced by the majority of U.S. residents, at least in the North, labor saw its stands eventually embraced by the government and adopted into law.
He cited other parallels between the abolitionist movement and labor in earlier years. One was that outside agitation by both for the most-radical solutions to social problems gave space to more “moderate” and adaptable politicians to advocate for and win the eventual critical social changes.
Abolitionists’ demands for absolute equality for African-Americans gave Lincoln the room to push through – with their help and agreement – the 13th 14th and 15th Amendments to the U.S. Constitution. The amendments freed the slaves, extended the Bill of Rights to the states and made anyone born in the U.S. automatically a citizen. The amendments offered political equality, which took a century to achieve, he added.
In labor’s case, Foner said, unions’ demands for union recognition and workers’ rights – taken to the streets in outside political agitation during the Great Depression -- gave FDR the room to enact his “Second New Deal” in the late 1930s. That included the National Labor Relations Act, the Fair Labor Standards Act, establishing the minimum wage and overtime pay, and Social Security.
Yet another parallel was that labor, like the abolitionists, used the threat of mass public protests to get its issues onto the national agenda, and sympathetic politicians welcomed that. In labor’s case, the protests were the great sit-down strikes of the 1930s, Foner said.
Another instance came several years later from A. Phillip Randolph, legendary civil rights and union leader and president of the Brotherhood of Sleeping Car Porters. The Brotherhood was the nation’s leading African-American union in what was then still largely a segregated labor movement. Randolph, Foner said, used the threat of a March on Washington in the mid-1940s to force FDR to integrate defense industries.
“Make me do it,” FDR told Randolph at a White House meeting before the planned march. When Randolph went ahead, FDR issued the executive order for integration and the march was called off. Civil rights, womens’ rights and other activists since then have followed the same abolitionist-labor-civil rights pattern, Foner added.
But the labor movement, Foner said, turned away from that outside-inside strategy after achieving its goals of union recognition and labor law, Foner said. And while he said that as an historian -- not a political scientist – he studies the past, Foner was pushed into saying whether the union movement should return to that strategy.
His answer was yes. But Foner said labor lacks the strategy, an unifying theme and a sympathetic powerful politician ready to be pushed in the right direction, as FDR was. Democratic President Barack Obama is not the man, yet, Foner stated.
“The jury is still out” on whether Obama will become such a politician now that he’s been re-elected, with strong union support, Foner said. But labor shouldn’t wait.
“The labor movement has to talk more about ways to radically change and improve the current system. Labor should be both inside and outside,” Foner stated. “Ever since the New Deal, labor has had a troubled relationship with the Democratic Party: It got gains, but it’s been taken for granted, so you don’t get much.” ###
CLOSING TAX LOOPHOLES…ER, TRUCKHOLES
Late last year, during the interminable wrangling over what to do to avoid the so-called “fiscal cliff,” House Speaker John Boehner, R-Ohio, at one point came up with an unexpected offer.
The Republicans, he said, would be willing, in a trade for locking in the low top tax rates for the very rich, to look at raising some $800 billion over the next decade by closing “tax loopholes.”
Boehner did not specify which ones he had in mind, preferring to leave that issue to be hashed out later – like this year. At any rate, Democratic President Barack Obama rejected that trade. Obama wanted, and got, a tax rate increase on the last dollars of income that now flow to the richest in our society, the top 0.7% who earn more than $400,000 yearly as individuals or $450,000 as couples.
But Boehner was on to something that ought to be pursued, regardless of what else Congress and Obama do to put the budget on a sound footing and stabilize the federal deficit and debt. The U.S. tax code is riddled with loopholes, secret breaks and special exceptions, inserted by one special interest after another.
Eliminating the loopholes would provide billions in additional revenue, help shrink annual deficits, and bring more of a measure of fairness and equity to a tax code that most taxpayers, rightly, believe gives too much to the rich and too little to the rest of us.
The Center for American Progress (CAP), a progressive think tank, compiled a list of such tax breaks. They might be better termed “truckholes,” not loopholes, because some of them cost the Treasury so much money. The total CAP came up with is a little less than $1 trillion over a decade. We thought we’d run their list for you. Feel free to agree, disagree or add your own ideas:
· $523 BILLION: Limit extra deductions enjoyed by top-bracket taxpayers.
· $168 BILLION: Close international tax loopholes and incentives to move jobs overseas. (Note: A GOP Senate filibuster killed that idea in the last Congress.)
· $140 BILLION: Eliminate write-offs for corporate meals and entertainment.
· $70 BILLION: End special tax breaks for inventory.
· $25 BILLION: End special oil, coal, and gas tax breaks. (That includes the ever-notorious oil depletion allowance.)
· $21 BILLION: Close the “carried interest” loophole for hedge fund and private equity managers (like Mitt Romney). In plain English, that means taxing their income at regular rates, not at the 15% capital gains rate.
· $11 BILLION: Eliminate the “S Corporation” loophole for alleged small businesses. CAP notes its insertion was a bipartisan effort by former House Speaker Newt Gingrich, R-Ga., and former Sen. John Edwards, R-N.C. Both politicians later became known for their extramarital affairs, and for running, unsuccessfully, for president.
· $10 BILLION: Deny the mortgage deduction for vacation homes and yachts.
· $3 BILLION: Eliminate the corporate jet loophole.
· $3 BILLION: Close the tax loophole for derivatives traders. CAP doesn’t say so but derivatives were among the seamiest and most-scandalous of the pieces of paper with nothing in back of them which financiers used to pyramid their profits in the run-up to the Great Recession.
When derivatives based on underwater mortgages collapsed, so did the rest of the economic house of cards – and the economy with it.
· $126 MILLION: Eliminate special write-offs for horse breeders (the Bluegrass Boondoggle). Again, CAP didn’t say so, but this tax break benefits rich dilettantes who own horse farms, primarily in Kentucky. Senate Minority Leader Mitch McConnell (R) is from Kentucky. Draw your own conclusions.
The Center’s total is $975 billion over 10 years, and there are some others they missed. We’ll add one: Taxing unearned income at regular tax rates, not at the lower 15% rate of the Bush tax cuts for the rich or even the 20% rate that Democratic President Barack Obama and lawmakers agreed to in the “fiscal cliff” bargain.
A search of various publications turned up no numbers of how much money you could raise by taxing interest, dividends and other such income at regular rates. But it did turn up the fact that 97% of the benefits of lower tax rates on interest and dividends go to the top 1% of taxpayers, the Center on Budget and Policy Priorities says.
For that reason alone, we’d add higher taxes on unearned income to CAP’s list.
But like we said, take the list and add your own favorites. It’s a way to start the conversation on how to get the federal budget closer to balance – and how to restore some equity to our imbalanced tax code. ###
OP-ED: THE BUSH TAX LEGACY LIVES
By Sam Pizzigati
Editor, Too Much
WASHINGTON (PAI)--A picture, the old saw goes, can be worth a thousand words. Pictures these days, of course, can be worth a great deal more than any word number. Last spring, for instance, a version of Edvard Munch's iconic 1895 painting, The Scream, sold at auction for $119.9 million, an all-time art auction record.
But images don’t have to be playthings for the awesomely affluent. Images can become visual fusillades against inequality, eye-openers to the realities of the unequal world all around us.
Speaking of images, how about that of the “fiscal cliff” that so dominated America’s first week of 2013? How will the outcome of this taxing battle affect inequality in the United States? We have some thoughts — and stats — to share with you.
The Bush years gave America's rich new and unprecedented preferential treatment at tax time. The fiscal cliff deal enacted in the early moments of 2013 leaves that preferential treatment in place.
So who won the New Year’s Eve standoff over the “fiscal cliff?”
In one sense, everyone “won.” The deal Congress blessed includes scores of provisions. Most Americans can point to at least one specific provision that works in their financial favor.
But the biggest winners from the fiscal cliff deal really don’t come into focus until we step back from those scores of specifics and take in the big picture.
Democratic President Barack Obama, back two months ago in the early stages of this latest federal budget debate, insisted on a solution that would raise $1.6 trillion in new revenues over the next decade, with most all of those revenues coming out of the pockets of Americans making over $200,000 (individuals) or $250,000 (families) a year.
The final deal raises a bit over $600 billion in new revenue. In other words, the final deal essentially saves America’s most affluent nearly $1 trillion over what the White House initially sought.
That $1 trillion in tax savings, all by itself, would be enough to make America’s wealthiest the heftiest winners in the fiscal cliff showdown. But the magnitude of the victory for America’s wealthy runs even greater than that $1 trillion.
Consider this: Even if Congress had given the president every tax increase on the rich he initially sought, taxpayers in the nation’s top tax bracket would still be paying federal taxes at less than one half the rate that top-bracket Americans faced in the 1950s, under Republican President Dwight Eisenhower.
In other words, America's wealthy won this latest battle over who bears the federal tax burden even before the battling began. But they also did mighty well after that battling started and in its outcome.
Take the matter of dividend income. Until 2003, income from corporate dividends enjoyed no particular tax preference. Dividend income faced the same graduated federal income tax rates as income from wages and salaries.
The George W. Bush years changed all that and slashed the tax rate on dividends — income that flows overwhelmingly to America’s wealthy — all the way down to 15%.
Wealthy Americans expected this preferential treatment for dividend income to end on Dec. 31, 2012, the last day before the expiration of the Bush tax cuts. America’s top corporate executives, anticipating that expiration, had the corporations they run rush to post dividends before the year-end deadline.
Overall, in 2012’s final quarter, over 100 major U.S. corporations announced more than $22 billion in dividend payouts, more than triple the dividend payout these same firms distributed in the last quarter of 2011. Among the beneficiaries: Larry Ellison, the CEO of business software giant Oracle. Ellison personally pocketed $198.9 million of Oracle’s $800 million dividend surge.
The early payout, Ellison no doubt figured, would save him over $50 million in federal income taxes, the difference between the Bush 15% tax rate on dividends and the tax rate he would face once the Bush dividend preference expired on January 1.
But the Bush preferential tax rate on dividends didn’t expire. The “fiscal cliff” deal that Congress passed last week keeps the preference in place. Ellison and his fellow billionaires will pay only a 20% federal income tax on their dividends, not the 39.9% the deal applies to other income over $450,000.
The benefit from tax breaks for stock dividends in the fiscal cliff deal will go overwhelmingly to America’s rich. In 2010, notes New York University economist Edward Wolff, households making over $250,000 a year made up only 3.6% of all households but owned 50.3% of all stock, either directly or indirectly through mutual funds and retirement plans.
The same dynamic played out with the fiscal cliff deal’s treatment of the Bush-era estate tax cuts. In fact, under the deal, America’s wealthy will pay even less in estate taxes than they paid in any year of George W’s presidency. In 2013, a wealthy couple will be able to totally exempt $10.4 million from any estate tax liability and face only a 40% rate on any estate value subject to tax, after deductions.
In 2001, the year before George W. Bush entered the White House, a couple could only exempt $2 million from the then 55% basic estate tax rate.
The fiscal cliff deal, in short, makes permanent the most notorious Bush-era tax breaks for the wealthy. Meanwhile, notes Robert Greenstein of the Center for Budget and Policy Priorities, the deal extends the tax credits for working families first enacted in 2009 only for five years.
“In essence, this agreement locks in a tax structure that is grossly unfair to middle class Americans, one which provides permanent tax assistance to wealthy Americans, and only temporary relief to everyone else,” said Sen. Tom Harkin, D-Iowa, a progressive who was one of only eight senators who voted against the New Year’s Day deal.
“Every dollar that wealthy taxpayers do not pay under this deal, we will eventually ask Americans of modest means to forgo in Social Security, Medicare, or Medicaid benefits,” added Harkin.
“It is hard for me to understand how the new definition for ‘middle class’ has become $400K of income a year. This agreement locks in a tax structure that helps the wealthy more than the middle class and only gives temporary relief to everyone else,” said Rep. Jim McDermott, D-Wash., another progressive against the “fiscal cliff” deal.
Back in 2010, the Dodd–Frank Wall Street Reform became law, and activists working to rein in CEO pay had a reason to cheer. America's top corporations, under Dodd-Frank, have to disclose for the first time ever the ratio between what they pay their chiefs and what they pay their median — most typical — worker.
But no corporation has yet actually had to meet this mandate. The reason? A massive corporate lobbying blitz has stalled the writing of the federal regulations needed to enforce Dodd-Frank's pay ratio provision. Even so, the Dodd-Frank mandate does seem to be making an impact — in India. Late last month, India’s minister of corporate affairs announced his nation's companies would now have to report both their top executive pay and their median employee salaries.