A weekly newsletter from the Institute for Policy Studies |
|
|
If the United Auto Workers bargaining team doesn’t make a deal with the Big Three automakers by tomorrow night, we’re going to witness a historic walkout, 150,000 workers strong.
What the union wants: The elimination of low-tier wages for new hires. An end to the abuse of temp workers. Meaningful wage hikes for all, not executive pay windfalls for some. Restored cost-of-living adjustments. Defined benefit pensions for every worker. And plenty more, including the right to strike over plant closures and a guaranteed place in the electric vehicle transition.
All that shouldn’t be too much to ask. Detroit’s Big Three have harbored over $21 billion in profits since this year began.
Yesterday, meanwhile, our Census Bureau reported that the nation’s poverty rate jumped nearly 60 percent last year while the child poverty rate more than doubled. We haven’t seen annual poverty increases this steep in over 50 years.
How the *#@! could we possibly let this happen? In 2022, crucial pandemic-era tax credit and public assistance expansions expired, in spite of public support.
“Poverty is a political choice, not a personal one,” our Institute for Policy Studies colleague and poverty expert Karen Dolan concludes from the new data. “Our elected officials need to build on investments in our families and small businesses instead of privileging corporate wealth.”
Arguments against vital anti-poverty programs echo those that we hear against labor demands: Decency for working families costs too much. Big Three auto execs have invested billions in stock buybacks. Yet they’re casting the UAW’s demands as far too indulgent.
Strikes, as the labor journalist Hamilton Nolan notes, do carry costs. But not striking also carries a cost, “one that lasts longer and, in aggregate, creates an entire economy in which the people who do the work get less than they deserve.” Bella DeVaan, for the Institute for Policy Studies' Inequality.org team |
|
| INEQUALITY BY THE NUMBERS |
|
|
Union Leader Reflects on Montgomery’s Civil Rights and Economic Justice
Earlier this summer, you might have seen a shocking video out of Montgomery, Alabama: A Black riverboat captain was viciously attacked by the white occupants of a nearby pontoon boat.
This violence evoked memories of the city’s ugly racist history, but the new president of the Communication Workers of America, Claude Cummings Jr., sees in the attack’s aftermath a powerful example of resistance and change that draws needed attention to regional progress on civil rights and economic justice.
Montgomery, Cummings notes, recently elected its first Black mayor, and Alabama’s disempowered workforce has been seeing progress as well. Promising new unionization campaigns are underway throughout the state, including recent organizing by AT&T Mobility workers at Alabama’s In Home Expert hubs. Why did those workers go union? As one member put it: “We deserve respect and dignity on the job, and a union contract protects the rights of all workers.” More on the riverboat brawl’s resonance at the link below. |
|
|
Formidable Coalition Asks G20 Leaders to Tax Extreme Wealth
What do 18 former heads of state, 65 economists, 108 elected representatives, and 120 millionaires have in common? One message for G20 leaders: It’s time to tax extreme wealth. These hundreds of advocates published an open letter addressed to the powerful representatives of the G20 nations, who gathered last weekend in New Delhi for their annual summit.
Coming after decades of plummeting tax rates and corroding economic opportunity, the letter explains, citing Inequality.org research, the Covid-19 pandemic has supercharged global inequality.
“Our political choices allow ultra-wealthy individuals to continue to use tax shelters and enjoy preferential treatment to the extent that, in most countries in the world, they pay lower tax rates than ordinary people,” state the authors. “At the same time, the world has seldom had more need for the richest to pay.”
Things don’t have to be this way, but new taxes require global cooperation. We already have on the table, the letter adds, “an abundance of policy proposals on wealth taxation from top global economists.” These proposals have overwhelming support. All that’s missing: the political will to deliver what the public wants. Read more about this global movement, co-organized by our inequality team at the Institute for Policy Studies, at the link below. |
|
|
The Tie That Truly Binds Grand Fortune and Great Talent
The richest among us have always loved to claim they have more talent — more smarts — than the rest of us. They fully deserve, in other words, the grand fortunes they’re so busily amassing.
Those of us who worry about inequality have never swallowed this deservedness claim. We’ve spent massive amounts of our time demonstrating how grand fortunes reflect all sorts of dynamics — from exploiting workers to paying off politicos — that have nothing to do with talent and brilliance.
But we skeptics about the talents of our super rich, in our haste to expose the hollowness of their claims, have been glossing over the one tie that does exist between talent and fortune. Inequality.org co-editor Sam Pizzigati has more. |
PETULANT PLUTOCRAT OF THE WEEK |
How Dare Anyone Question the Wisdom of the Free Market
This week’s dour deep pocket: Billionaire Ryan Cohen, the founder of the online pet store Chewy who currently chairs the video game retailer GameStop.
What has him sour: Cohen, a go-to online tipster for “meme stock” retail investors, has come under federal investigation for his massive personal dumping of Bed Bath & Beyond shares last summer — just after talking up the troubled company in his widely followed Twitter ramblings.
Cohen’s explanation for his sudden about-face? Bed Bath shares, he says, had “unexpectedly increased to a value that exceeded” their actual worth. But those shares only skyrocketed after Cohen began aggressively pumping them up. Just a week before unloading his huge Bed Bath stake, a Cohen tweet referenced the company with a smiling moon emoji, an image that signals to the meme stock subculture that a share price may soon be shooting up “to the moon.”
Cohen cleared a $60-million profit on his Bed Bath share machinations, a maneuvering that left “many retail investors,” the Daily Beast notes, “with virtually worthless shares.”
The last word: Christina Sautter, an analyst at LSU’s Hebert Law Center, believes retail investors caught up in the meme stock frenzy have essentially deified charismatic billionaires like Cohen, an adoration that “Cohen definitely cultivates.” |
|
|
This week on Inequality.org
Helen Flannery, More than Half of America’s 20 Top Public Charities Are Donor-Advised Funds. The highest-earning DAF now takes in $11 billion more than the highest-earning working charity.
Elsewhere on the Web
Kristin Toussaint, Special Report: Understanding out-of-control CEO pay — and why it’s a problem, Fast Company. Can unions, shareholders, and politicians start to rein in spiraling executive pay packages? Our Sarah Anderson weighs in. Jeet Heer, Elon Musk Is a Threat to Democracy, The Nation. How the mega-billionaire owner of Tesla and Space X has become a state within a state. Sonali Kolhatkar, Will Billionaires Build a New Utopian City — to Replace What They Ruined? Los Angeles Progressive. Silicon Valley’s wealthy elites have been secretly buying up land in one of California’s poorest counties to build a new city from the ground up.
Robert Scheer, The Four Billionaires Who Want to Control the Universe, KCRW. Internet innovation expert Jonathan Taplin’s new book focuses on the oligarchs Elon Musk, Peter Thiel, Mark Zuckerberg, and Marc Andreesen, breaking down the ambitions that are corrupting both sides of the political aisle.
Laura Paddison, Activists spray red paint over billionaire Walmart heiress’s superyacht for a second time, CNN. Activists from the climate groups Scientist Rebellion and Extinction Rebellion accessed a dock for superyachts to send a simple message: Our globe’s richest 1 percent are continuing to pollute more than our poorest 50 percent.
Dan Weil, How economic inequality is fueling authoritarianism: Nobel laureate Joseph Stiglitz offers an explanation, The Street. Our tax policies favor the rich, our education system favors the privileged, and inadequate antitrust regs let corporations amass and exploit market power.
David Dodwell, Political silence on inequality is strangling our prosperity and democracy, South China Morning Post. Academics warn that inaction is corroding politics and trust, and weakening prosperity and multilateralism, as support grows for the idea that democracy delivers unfair outcomes.
Mei Cheng and Yuan Zhang, Corporate Stakeholders and CEO-Worker Pay Gap: Evidence From CEO Pay Ratio Disclosure, Harvard Law School Forum on Corporate Governance. A new study demonstrates that firms ought to be considering all stakeholders in making corporate decisions on pay and other matters. Collectively, employees, communities, and governments can contribute to distributive justice.
Oliver Bullough, Why Saudi money is so hard to refuse, Oligarchy. Among the many good reasons to support the urgent creation of renewable energy systems: the need to stop giving money to tyrants who happen to sit on vast fossil fuel reserves. |
|
|
Through their current contract negotiations, the UAW aims to narrow the huge pay gaps within the Big Three automakers: Ford, General Motors, and Stellantis. The CEOs of these companies each made more than $20 million last year, hundreds of times more than their typical employees. |
|
|
Inequality.org | www.inequality.org | inequality@ips-dc.org Managing Editor: Isabella DeVaan
Co-Editors: Sarah Anderson, Chuck Collins, and Sam Pizzigati Production: Isabella DeVaan |
|
|
|