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“Labor Day Report: Michigan’s Paycheck Blues”

Each year the Michigan League for Public Policy issues a Labor Day report on the status of Labor with in the state. This year the outcome for Michigan Labor is no better than in previous years. 90% of Michigan Labor finds themselves making less and a further deterioration in earning power. The upper 10% of Labor has been able to maintain its earning power while the majority of Labor today makes less than what it did 30 years ago when adjusting for inflation.

 

Michigan Workers Hourly Wage

 

Median Wage workers making $15.89/hour in 2012 can purchase 7% less than Median Wage workers in 1982 while those workers in the 90th percentile has seen its purchasing power increase by 22% over the same period. Having the 4th highest Median Wage in 1982, Michigan saw its Median Wage deteriorate to 24th after losing much of its manufacturing base through globalization and the skewing of productivity gains to Capital. In comparison to other states and six of eight Midwest states, Michigan saw a decrease of 7% in Median Wage while the other states (Wisconsin decreased 2%) increased Median Wage. In determining the significance of the drop from from 1982 to 2012, Michigan ranked 50th amongst the states and District of Columbia with Alaska at 51st (larger drop).

 

Change in Median Wages 1982 -2012

 

90% of Michigan Labor’s earning power has been hit hard since 1982. Looking at the racial makeup of Michigan Labor and breaking it down by race, there is a  great and growing  disparity in earning power for African American when compared to Caucasian Labor. The gap in earning power between the two groups is at its widest in 34 years of tracking Labor wages. “The gap became widest in 2012, when the white median wage was $4.20 an hour (25%) higher than the African American median wage.1

 

Hourly Median Wages of White and African American Workers

 

While overall Median Wage has decreased by 1% for Caucasian Labor, African Americans have seen a deterioration of Median Wages of 24% since 1982. During the Clinton era, it was said economic growth resulted in Labor seeing greater gains in wages. While this is true for Caucasians the gap between African American and Caucasian Labor. African American Labor  did not experience the temporary growth in wages their Caucasian Labor counter parts did and remained flat.

 

Hourly Median Wage Change

 

A difference in Labor Wages can also be found at the professional levels as well. For example, a “$90,000 median wage for for whites and a $68,000 median wage exists for African Americans in selected majors such as Electrical Engineering.” While  attaining a postsecondary credential can greatly increase earnings for African American workers, racial disparity will continue to exist.1 At the lower incomes the impact of education pays an even bigger factor in wages. The lack of a high school diploma is twice as high for African Americans as it is for Caucasians and the attainment of an Associates Degree is 40% higher for Caucasians as it is for African Americans.

Tom Hertz in Understanding Mobility in America pointed to various factors impacting the upward mobility of people in America. Like Peter Ruark, Tom Hertz pointed to education and income being important factors as well as location or residence. By law segregation was eliminated in the sixties; yet, metropolitan Detroit remains one of the most segregated areas in the country today. Peter Ruark suggests a linkage between occupational and the residential segregation experienced in Detroit;  “residential patterns that segregate black and white youth increase the likelihood that these whites will find better-paying jobs in overwhelmingly white occupations and that blacks will end up in lower-paying occupations filled mostly by other blacks.3” To which I would add, the flight of business and whites has been occurring since the sixties destroying the tax base of the city leaving little resource for the city to address many of the issues there. While formal segregation has ended in the US, SCOTUS blocked the city and the NAACP from seeking resolution to the segregation of schools (Milliken vs Bradley).

Also in his conclusions, Hertz determines various factors limit the mobility of generations beyond that of income. The United States has one of the “lowest rates of intergenerational mobility among high-income nations, such that the chances of ending up rich if you were born to a low-income family are on the order of just one percent.2 Factors determining mobility include Education, Income, State in which you live, Health, female head of family,  and Race of which Education is the most important factor. Even after controlling for the other factors in his study, Hertz determines Race plays a significant factor in upward mobility. Upward mobility for low and middle income Labor is difficult at best and even more so for African Americans when factors beyond income are considered.

 

References:

1.  “Labor Day Report, Michigan’s Payday Blues  , Peter Ruark, Michigan League for Public Policy August 2013 

2.  “Understanding Mobility in America,”  , Tom Hertz,  The Center for Progress, April 2006

3. “Occupational and Residential Segregation: The Confluence of Two Systems of Inequality,”, Niki D. Von Lockette, Rutgers University School of Management and Labor Relations

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“Willful blindness”

The example presented of a community and willful blindness is concrete enough to be useful for a conversation I believe, and to mean something to readers in general. There is the risk the term ‘willful blindness’ be bandied about and misused as happened in prior years with the term ‘cognitive dissonance’, a term thrown like little lightning bolts in conversation, or applied to points of view only contrary to one’s own, but it is something we all do to some extent. On the other hand, there are times when such ‘willful blindness’ is readily apparent as evidence mounts up…keeping evidence under wraps is another avenue to ignorance.

Gayla Benefield was just doing her job — until she uncovered an awful secret about her hometown that meant its mortality rate was 80 times higher than anywhere else in the U.S. But when she tried to tell people about it, she learned an even more shocking truth: People didn’t want to know. In a talk that’s part history lesson, part call-to-action, Margaret Heffernan demonstrates the danger of “willful blindness” and praises ordinary people like Benefield who are willing to speak up.

14 minutes from a Ted talk is here.

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The PPACA and Healthcare Sky is Falling Again . . .

Chicken Little

Huh? Repeal the PPACA to Help Hispanics and African-Americans ? ? ?

Crooks and Liars carries a conversation by Repub Senator Ted Cruz with Candy Crowley on CNN. Senator Ted Cruz of Texas is making it his crusade to repeal the PPACA so as not to cause harm to the most vulnerable of America who potentially are losing their jobs, the Hispanics and African-Americans and singe moms. To real the PPACA do so, he is asking the House to pass a budget which specifically funds everything the government needs with the exception of funding for the PPACA. Factcheck.org has debunked the lost job claim here: GOPS’s ‘Job-Killing’ Whopper, Again and previously.  There is no basis for Senator Cruz’s claim for lost jobs due to the PPACA.

As we’ve said before (a few times), experts project that the law will cause a small loss of low-wage jobs — and also some gains in better-paid jobs in the health care and insurance industries.

It’s also expected that more workers will decide to retire earlier, or work fewer hours, when they no longer need employer-sponsored insurance and can obtain it on their own with help from federal subsidies. But that just means fewer people willing to work — and it will free up jobs for those who want them. If anything, that could reduce the jobless rate.

Maybe Senator Cruz is implying employers will cut hours to less than 30 per week? Our own Spencer England has done a couple of posts on the topic of cutting hours to less than 30 hours. It just is not happening as the critics and naysayers are claiming.  Obamacare, The Sequester and Part Time Employment and here: Obamacare and Employment.

Is the PPACA hurting Hispanics and African Americans as Senator Cruz says? The US Department of Health Says No.  913,000 Latino have already benefited and 509,000 African-Americans to date. If anything, it appears that more of the minorities Mr. Cruz claims are being hurt are being helped by the PPACA.

Young Adults with Insurance

 

“Federal Healthcare Can Not Work” according to former Senator Jim DeMint who recently became the Heritage Pres  .  .  .

Dean Howard and Heritage Pres Jim DeMint face off on CNN as reported by Crooks and Liars. Former Repub Senator Demint: DeMint explained that Heritage Action had launched a nine-city tour to rally Americans in support of repealing Obamacare because it was an “unfair and un-American law.”

“Federal health care is not going to provide good health care to Americans,” DeMint insisted. “You can’t find a federal program that’s working effectively.”

Howard Dean Gov. of Vermont “Jim, I disagree with that,” former Vermont Gov. Howard Dean (D) replied. “I think Medicare works pretty darn well and people like it. And that’s a federal program that works very well for people.”

Demint: (Medicare) “It’s tens of trillions of dollars in debt because it’s been mismanaged, it’s going to leave huge debts onto our children, and more and more doctors won’t even see a Medicare-insured patient,” DeMint replied. “So, it is not going to work for the future.” The former South Carolina senator continued: “And as we put more people on Medicare and Medicaid, and that’s what Obamacare is going to do, is to push more people into Medicaid-style plans, fewer and fewer doctors are going to see these folks. So, we need to make sure we get health insurance that doctors will actually take.” The former South Carolina senator continued: “And as we put more people on Medicare and Medicaid, and that’s what Obamacare is going to do, is to push more people into Medicaid-style plans, fewer and fewer doctors are going to see these folks. So, we need to make sure we get health insurance that doctors will actually take.”

Howard Dean: “I’m sure it won’t surprise you to know that I disagree with that,” Dean said before he was interrupted by Bash.

CNN’s Bash: “I’m so shocked,” she snarked, promising to allow Dean to respond following a commercial break.

Howard Dean (after break): “Before we get to that, let me get a little equal time on health care,” Dean demanded. “You know, I was not a supporter of Obamacare when it passed. I am now. I think this ought to be implemented. You know, in our little medical office in Burlington, Vermont, we’ve discovered that premiums are going to be cut in half for the five people who work for my wife and her partners. So, this is going to make a big difference.”

While the PPACA is not the end all of healthcare plans, it still is a step forward in the right direction which has not been addressed since Hillarycare failed in 1993. To the question, are Doctors accepting Medicare patients? More Doctors Accepting Medicare Patients

“The number of physicians accepting new Medicare patients rose by one-third between 2007 and 2011 and is now higher than the number of physicians accepting new private insurance patients, according to a Department of Health and Human Services report obtained by USA TODAY.”

Someone is blowing smoke up  .  .  .  well, ahhh again.

 

Texas Representative Louie Gohmert’s Healthcare Hooey 

Factcheck.org reports on Repub Texas Rep Louis Gohmert who claims under the PPACA a:

“poor guy out there making $14,000″ is ‘going to pay extra income tax if he cannot afford to pay the several thousand dollars for an Obamacare policy.’”

While there are issues with people who just exceed 400% FPL getting subsidies, Rep Gohmert of Texas claim is erroneous. A person making $14,000 in income is at 122% of FPL and would be subsidy eligible. Under the PPACA, if a citizen lives in a state which expands Medicaid to 138% FPL, the person making $14,000 would be covered under it. If a citizen lives in a state “like Texas” which chooses to not expand Medicaid, the person would be exempt from the mandate or additional income tax as Gohmert claims. A rule published July 1st granted the exemption to the mandate or citizens who live in states which do not expand Medicaid.

There is a lot of controversy about expanding Medicaid to cover people making less than 138% FPL in that the gov. could attach assets in the future. States do have that option and in fact they do enforce it when the middle class uses Medicaid to pay for assisted care and nursing home care which is nothing new and did not come about with the PPACA. Those wealthier than FPL must meet a certain income and asset standard before Medicaid will kick-in.

 

Obamacare by The Numbers

Factcheck.org reports on false claims by the Republican National Committee:

“Republican National Committee claims that 8.2 million Americans can’t find full-time jobs ‘partly due to ObamaCare.’”

Since the PPACA was implemented, the numbers of part time workers has been decreasing. The numeric quoted represents the total number of part time workers seeking full time work.

Part-time workers Graph

6 million retirees will also lose their:

“prescription drug coverage”

The quoted 6 million losing their prescription drug coverage are expected to go on Medicare Part D after losing Employer covered drug prescriptions. The tally by the RNC goes on for 55 more losses by citizens under the PPACA as accounted for in their RNC report:  Obamacare by The Numbers

 

74% of Small Business will fire workers, cut hours under Obamacare.

Factcheck.org reports on how John Boehner misquoted a recent Chamber of Commerce release of a 3 page Small Business Outlook Study. Only 13% of small businesses said they would take such actions in the study.

Speaker John Boehner Tweet, July 17 CC Study: “74% of small businesses will fire workers, cut hours under #Obamacare” http://bit.ly/12GmjgF cc @dcexaminer @uschamber

Even though some companies will cut workers to less than 30 hours to avoid providing them with healthcare insurance, the companies will still have to pay in equivalents. The government calculates something it calls full time equivalent employees. It divides the number of hours that part time workers actually work in a month ]by 120 to see what it is in equivalent. In effect, for purposes of the regulation two part time employees will count as one full time employee in determining if the firm has over 50 employees and is subject to the penalty. So actually, firms will not be able to avoid the penalty by just cutting the hours its employee work to under 30.

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Another Mail Provider Shuts Its Doors

Following the lead of Lavabits, Silent Circle is closing down its business. Unlike Lavabits, it has not been told to provide access to customer data; but, Silent Circle sees the handwriting on the wall. It can no longer provide secure and private.

As an article within Silent Circle points out, metadata cannot be encrypted or protected. The header of all email includes such unprotected data as the name of the host that connected, the IP address of the sender as well as the IP address of the receiver, the encryption status of the message, the type of cipher and its size, date and time sent, etc…. Assuming the actual message was not viewed–a perhaps unwarranted assumption–, the problem is that the size and scope of the snooping is so enormous that a great deal of information can now be inferred by simply knowing, for example, the number of times you emailed specific persons, the size of the emails….and so forth.

With the tapping of backbone internet providers, interested parties can now see all traffic on the internet

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Why Are We Rushing To Get Rid Of Fannie Mae and Freddie Mac?

by Barkley Rosser via Econospeak
(reposted with authors permission)

Why Are We Rushing To Get Rid Of Fannie Mae and Freddie Mac?

“How many Virginians does it take to change a light bulb?

Five: One to change the bulb and four to talk about how great the old bulb was.”

I think I am turning into my late father, a conservative in the old traditional way of defending existing institutions and practices.  Here I go, about to defend Fannie Mae and Freddie Mac, whom all Very Serious People know should go as soon as possible.  President Obama thinks they should go, and we have two bills in Congress that will lead to that outcome, one in the Senate co-sponsored by Dem Sen. Warner of VA (my state) and Rep Sen. Corker of TN, both VSPs in good standing, while in the House Banking Chair Hensarling (R-TX) also has such a bill. I mean wow, we have both the president and VSPs from both parties in Congress on this.  It must be great.  I mean, we all know that they were responsible for all the problems in the housing market that led to you know what!

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Groklaw closes: Another Victim of the Surveillance State

Like the owner of Lavabit, the founder of Groklaw, Pamela Jones, will close the Groklaw site, a site that has won numerous awards for legal analysis, covering such topics as the EU Microsoft anti-trust case, the SCO-Linux Lawsuits….The problem: Email privacy is now simply a fantasy. Open source, Groklaw depends on reader information. In short, Groklaw depends on email. For its work, Groklaw has received awards from the American Bar Association, the Electronic Frontier Association…. The Library of Congress selected it for its Web Archival Project, in the category of legal blogs.

An open-source legal website, Groklaw is now defunct.

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“Chicago issues RFP for more charter schools”

As my Chicago friend Mike (doodahman) points out in Facebook, the City has just issued RFPs for additional Charter Schools. This comes after Chicago Public Schools closed 50 schools throughout the city causing students to travel farther and over crowding other schools. The Chicago Teachers Union sees it as a union busting tactic and predicted it as such as Charter School teachers can not be represented by the union (CTU).

“Without fanfare, the district posted an official ‘request for proposals’ to its website Monday that invites charter schools to apply to open shop in what the school district has identified as priority neighborhoods—large swaths of the Southwest and Northwest sides.

Those heavily Latino areas have struggled with overcrowded schools.

The district wants what it’s calling ‘next generation’ charter schools, which could combine online and traditional teaching. It also wants proposals for arts integration charter schools and dual language charters.

Chicago is coming off a painful process to close 50 schools it said were underutilized; the district last December determined that half its schools are underenrolled. District spokeswoman Becky Carroll said Tuesday in an email that “while there were significant population declines in some parts of the city, there were also increases in other parts of the city…. There are many schools that are overcrowded or are facing overcrowding and we need to address that issue as we do any other.”

The Chicago Teachers Union and others have argued for years that school closures are about making way for charters and weakening the union.

‘We are not surprised at all by this,” said union president Karen Lewis . “We were called conspiracy theorists, and then here is the absolute proof of what the intentions are…. The district has clearly made a decision that they want to push privatization of our public schools.’

The district has been slowly shifting students to charter schools, which are publicly funded but privately run. Around 13 percent of district students—and more than 20 percent of the district’s high school students— are educated in charter schools. Teachers at charters cannot be represented by the Chicago Teachers Union.”

As one reader pointed out in the above article, the Chicago Commercial Club (ComCC) is behind much of the change going on in the Chicago Public School system. The ComCC membership consists of many of the well to do with in the City

“The blatant self-serving intrusion of the ComCC in the city’s education system is highlighted by the fact that its Civic Committee issued a report titled ‘Left Behind’ whose recommendations became the basis for CPS’s draconian Renaissance 2010. The Renaissance 2020 plan called for the closing of 60 to 70 neighborhood schools and for the introduction of up to 70 charter schools. According to DePaul University professor Pauline Lipman ‘Renaissance 2010 opens up the third largest school system in the USA to a market model of school choice, privatization, and elimination of school employee unions and elected local school councils.

The ComCC membership consists of many of the well to do from the City who exercise their influence and power regardless of who is in office. The implications of which cause one to wonder what it means for the city and schools with all of this corporate power and influence used to shape both. The bottom line is still to enhance their profits at the expense of the people they claim to be attracting.

Rahm I. Emanuel, Mayor, City of Chicago; William M. Daley, Chief of Staff, The White House; Lester Crown, Chairman, Henry Crown and Company [family wealth = $4.8 billion]; Kenneth C. Griffin, Founder and Chief Executive Officer, Citadel, LLC [wealth =$3.7 billion]; Tony W. Hunter, Chief Executive Officer, Tribune Publishing Company Valerie B. Jarrett, Senior Advisor to the President, White House; Paul V. La Schiazza, President – Illinois, AT&T Illinois; Timothy P. Maloney, Illinois President, Bank of America; J. B. Pritzker, Managing Partner, The Pritzker Group [wealth = $1.6 billion]; Penny Pritzker, President and Chief Executive Officer, Pritzker Realty Group, LP [wealth = $1.7 billion]; Thomas J. Pritzker, Chairman, Hyatt Hotels Corporation [wealth = $1.8 billion]; J. Christopher Reyes, Chairman, Reyes Holdings, LLC [wealth = $2 billion]; Michael D. Scimo, Managing Director, Chicago Office, Accenture; William Wrigley, Jr., Chief Executive Officer, Wrigley Management, Inc. [wealth = $2.2 billion], etc.

References:

Just months after closing 50 schools, Chicago issues RFP

The Biggest Shark in the Reinvention Pond: The Commercial Club of Chicago

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Detroit’s lessons…..Joseph Stiglitz ponders

Joseph Stiglitz offers perspective on the bankruptcy of Detroit and its wider context:

At one level, one might shrug: companies die every day; new ones are born. That is part of the dynamics of capitalism. So, too, for cities. Maybe Detroit and cities like it are just in the wrong location for the goods and services that 21st-century America demands.

But such a diagnosis would be wrong, and it’s extremely important to recognize that Detroit’s demise is not simply an inevitable outcome of the market.

For one, the description is incomplete: Detroit’s most serious problems are confined to the city limits. Elsewhere in the metropolitan area, there is ample economic activity. In suburbs like Bloomfield Hills, Mich., the median household income is more than $125,000. A 45-minute drive from Detroit is Ann Arbor, home of the University of Michigan, one of the world’s pre-eminent hubs of research and knowledge production.

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According to The Onion: Congress Fiercely Divided Over Completely Blank Bill

We interrupt our daily coverage for this moment of humor:  Congress Fiercely Divided Over Completely Blank Bill That Says And Does Nothing

WASHINGTON—A blank piece of legislation that says nothing, does nothing, and contains no text whatsoever has been the source of heated debate in Washington this week, and has sharply divided Congress along partisan lines, Beltway sources confirmed Thursday.

Known as S.0000, the bill, which doesn’t have sponsors, co-sponsors, or an author, has reportedly drawn starkly contrasting opinions from legislators in both the Senate and House of Representatives, and has paved the way for a major legislative battle in coming months.

“At a time when millions of Americans are still struggling, we simply cannot afford this kind of devil-may-care federal policy,” said Senate Minority Leader Mitch McConnell (R-KY), angrily waving the blank stack of papers in front of reporters. “We will not risk leading the American people into further hardship simply so the Obama administration can once again do whatever they please, regardless of the consequences. As it is now, the bill is both short-sighted and utterly irresponsible.”

“Frankly, we need to get back to the negotiating table and make some major changes before members of my party would even consider putting this up for a vote,” McConnell continued. “And if my friends on the other side of the aisle try push it through, well, they’ll pay the consequences at the ballot box.”..

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