This year’s Jackson Hole hobnob, once again hosted by the Federal Reserve Bank of Kansas City, last week attracted the usual assortment of central bankers, finance ministers, and influential business journalists. But this year’s gathering also attracted something else: protesters. For the first time ever, activists converged on Jackson Hole — to let the Fed’s central bankers know, as protest organizers put it, that “it’s not just the rich who are watching them.” Over 70 groups and unions backed the protest and signed onto an open letter that calls on America’s central bankers to start nurturing an economy that works for workers. At one point, early on in the Jackson Hole gathering, protesters actually had a brief exchange with Federal Reserve Board chair Janet Yellin. “We understand the issues you’re talking about,” Yellin told them, “and we’re doing everything we can.”
This is the reality of our political system in 2014: In what should be a titanic battle between multinational corporate power and federal power, our elected representatives are hardly putting up a fight. Obama has been a sharp critic of corporate tax avoidance. Yet the offshore corporate earnings stash has nearly doubled on his watch. Senate Majority Leader Harry Reid has unleashed blistering attacks on corporations like Walgreens that have threatened to renounce their U.S. citizenship for tax purposes. And he has said he’s “ready to roll” on a vote for a (sure-to-fail) Democratic bill that seeks a two-year moratorium on inversions. Yet Reid has also been shopping a stand-alone tax-holiday proposal, rewarding multinational tax avoiders with a 9.5 percent rate. Reid’s partner in this effort? Kentucky Republican Rand Paul – who’s been courting right-wing billionaire David Koch.
With companies lavishing virtually all their net income on shareholders and executives, the way many of them cover their actual business expenses — their R&D, their expansion — is by taking on debt through the sale of corporate bonds. A number of companies, however — most prominently, IBM — borrow specifically to increase their payout to shareholders. And IBM is not alone. Friday’s Wall Street Journal reported that U.S. companies are currently incurring record levels of debt, much of which, the Journal noted, “is being used to refinance existing debt, being sent back to shareholders as dividend payments and share buybacks, or banked in the corporate treasury as executives consider how to potentially deploy funds as the economy expands.” Many of the companies that have spent the most on buybacks, Lazonick demonstrates, have also received taxpayer money to fund research they could otherwise afford to perform themselves.
Shining. Soaring. Skyrocketing. Solar is so exciting, we’re running out of adjectives. The what, the why, and the where-to of America’s solar power revolution are the subjects of a new UCS report and infographic. It’s a story worth celebrating. The 4 Ps of rooftop solar The story of solar, as told in UCS’s new Solar Power on the Rise report, is full of great news, such as: The amount of solar power installed in the United States by 2013 was more than five times 2010’s level. Our country has enough solar to power some 2.4 million typical U.S. households. In June California set a one-day solar record, with solar meeting 8 percent of its overall electricity needs. Rooftop solar, the photovoltaic (PV) panels dotting the roofs of a rapidly growing number of homes and businesses, is one big piece of the charge, worthy of a closer look. And one way to consider its progress is to borrow business types’ “4 Ps” of marketing, for our own 4 Ps of solar—Product, pricing, place, and policy.
Those who work in jobs that pay poorly are now making even less than they were when the recovery began, according to a new analysis from the National Employment Law Project (NELP). As the report notes, since the recovery started in 2009, “Lower- and mid-wage occupations experienced greater declines in their real wages than did higher-wage occupations.” Jobs that pay in the top two tiers saw a decline in wages between 2.1 and 2.5 percent. But those in the bottom three groups in terms of pay saw wages decline between 3.6 and 4.6 percent. Some of the low-wage jobs that employ the most people have suffered even more. The food service industry has seen big drops: an 8.3 percent decline for restaurant cooks, 6.3 percent for food preparation workers, and 3.5 percent for servers. Maids and housekeepers have seen wages decline by 5.8 percent, as have home health aides, while personal care aides have seen a 6.3 percent decline. And retail workers have had wages go down by 4.2 percent. Overall, across all jobs, median hourly wages have declined 3.4 percent between 2009 and 2013.
On the surface, the unrest in Ferguson, Mo., was about local police using deadly force on an unarmed young man. But on a deeper level, it reflected the increasing poverty and economic decline that affects ethnic communities all over America. Despite rosy reports in the media about the end of the national foreclosure crisis and the recession that followed, all is not well in our inner cities and suburbs with largely minority populations, like Ferguson. The foreclosure crisis was hard on many Americans, but it was a disaster for communities of color, including the citizens of Ferguson. Half of Ferguson Homes Underwater In the zip code that encompasses Ferguson, half (49 percent) of homes were underwater in 2013, meaning the home’s market value was below the mortgage’s outstanding balance. This condition (also called “negative equity”) is often a first step toward loan default or foreclosure, according to the recent report, “Underwater America,” from the Haas Institute for a Fair and Inclusive Society at the University of California, Berkeley.
Borrowers with federal student loans, long promoted as the safest way to borrow for college, appear to be buckling under the weight of their debt, new data show. More than half of Direct Loans, the most common type of federal student loan, aren’t being repaid on time or as expected, according to figures from the U.S. Department of Education. Nearly half of the loans in repayment are in plans scheduled to take longer than 10 years. The number of loans in distress is rising. The increase in troubled loans comes as the average amount of student debt has significantly outpaced wage growth. After adjusting for inflation, the average recipient of federal student loan funds owed 28 percent more in 2013 than in 2007, according to Education Department data. But the typical holder of a bachelor’s degree working full time experienced a 0.08 percent decrease in weekly earnings during that same period. For those with advanced degrees, median wages increased just 0.02 percent, according to figures from the U.S. Bureau of Labor Statistics. The Obama administration, mindful of borrowers’ difficulty in repaying their federal student loans, has been promoting repayment plans that cap monthly payments relative to income. An unemployed borrower with no income, for example, could pay nothing every month, yet still be considered current on the debt.
With so many homeowners and businesses making greener energy choices, private utilities – along with big oil, gas, coal, and nuclear companies – see the writing on the wall. Unlike some other denizens of the fossil-fueled set, this gang isn’t beating oil wells into solar panels, retiring nuclear reactors, or embracing wind and geothermal power. Instead, these guys are trying to coax lawmakers into rigging the rules against increasingly competitive new energy alternatives. You see, the bulwarks of conventional energy are good at math. And the math is increasingly not in their favor. Solar panels are growing so affordable, accessible, and popular that sun-powered energy accounted for 74 percent of the nation’s new electric generation capacity in the first three months of this year. Wind power comprised another 20 percent, geothermal 1 percent, and natural gas plus other sources accounted for the final 5 percent. Coal didn’t even register. OK, so that first-quarter surge was kind of an anomaly because it included the inauguration of the Ivanpah Solar Electric Generating System, the world’s largest solar-concentrating power plant. Through a vast array of seven-by-ten-foot mirrors located on federal land along the California-Nevada border, this remarkable site produces enough energy to power 140,000 homes. Another vast utility-scale project aptly called “Genesis Solar” ramped up too.
UBS, the world’s third top funder of mountaintop removal in 2011, has taken steps demonstrating its commitment to significantly reduce financing of the mining practice. Last month, the bank confirmed to environmental campaigners that it will continue backing away from mountaintop removal financing.Moreover, UBS has declined to participate in the most recent transactions with its former clients Alpha Natural Resources and Arch Coal, which were among the top producers of mountaintop removal coal in 2013. “UBS’ statement is a step in the right direction on mountaintop removal, but it’s the bank’s actions that show they’re following through,” said Ricki Draper of Hands off Appalachia. “We have seen that grassroots organizing can make a difference in stopping the financing of this deadly form of mining that poisons coalfield communities and contributes to the destruction of Appalachia’s culture and heritage.”
Steven Rosenfeld: Your book starts with a very sober assessment of the American middle-class. It’s shrinking. It’s disappearing in our lifetime. And the reason is that most work-related income is not enough. It’s insufficient and that’s getting worse. Tell me about that. Peter Barnes: One can throw out all the numbers, but rather than do that, just think back. Some of us, like myself, are old enough to remember when there were lots of good-paying steady jobs, both in the private sector and public sector. They had benefits, covered health insurance, and provided pensions. That was what the middle-class was built on when I was growing up. Now, for a variety of reasons, including globalization, and automation, and the decline of labor unions, that is no longer the case. And most of the younger people who are entering the labor market today don’t get jobs like that. It’s kind of a “you’re on your own economy.” Everybody temps. They have more than one job. They’re always marketing themselves on LinkedIn or something like that to get the next job. They don’t get health coverage. They have to pay for their own pensions and so forth. On top of which, education costs are way up. Students have debts they have to pay. All these things are different and they are not changing. They are going down, not up, as far as the middle-class goes.
In the U.S, 38 percent of the population—88 million people—either have no bank accounts (the “unbanked”) or are at least partially dependent upon high-cost services like payday lending (the “underbanked”). These households pay dearly for basics. In 2012, the income for the average underbanked household was about $25,500, but it spent an average of nearly $2,500 solely on interest and fees for alternative financial services (AFS) like payday lending. That’s almost 10 percent of their annual income—about as much as they spent on food. Unbanked and underbanked people are a mix of working and middle-class families, students, the unemployed, and others living paycheck-to-paycheck. Yet financial exclusion is disproportionately rampant among people of color and immigrants, and especially women within those groups.
At the same time, the term commonwealth is as American as Massachusetts, Kentucky, Pennsylvania or Virginia, all of which call themselves commonwealths. It conveys the sense of things we hold in common, including our precious natural resources, offering a broader vision for ideas like Peter Barnes’ guaranteed national income supplement from taxes on fossil fuels. Adding to its usefulness, the idea of the Cooperative Commonwealth fits nicely with the emphasis on building new producer and consumer cooperatives in the United States, an effort Gar Alperovitz and colleagues have been promoting in Cleveland and other cities, with the success and scope of the Mondragon cooperatives in Spain as an example.
Police will be allowed to clear a square in London where anti-capitalist protesters camped in 2011, following a ruling on Friday. Activists from the Occupy London movement set up camp outside the London Stock Exchange in Paternoster Square, nearby St Paul’s Cathedral, in 2011 and again in smaller actions in May 2012 – despite an earlier injuction. The group describes itself as part of a global movement which aims to “put democracy and the environment before profit”. In February 2012, police dismantled the movement’s camp following a High Court injunction by the City of London Corporation – the square’s owner. The City of London Corporation has now classified the square as a “City walkway”, meaning police can immediately close Pastnoster Square, as well as six adjoining lanes and alleys, in the event of an “imminent threat” or unforeseen events, the Evening Standard reported.
As elections get closer, Democratic Party leaders in Congress are getting the message out to inside-the-beltway activists groups that they are unifying to support giving President Obama some form of Fast Track. Recent letters from member of Congress to the President indicate support for trade with particular stipulations, but the overall message is to continue negotiating. Washington advocacy groups believe that they must also show support for Fast Track or they will find themselves without access or influence. Rather than kowtowing to the usual ‘on the table’ threat from the corrupt bi-partisan Congress, the movement needs to tell them that the only thing on the table is a complete transformation from the failed global trade that rigs profits for big business at the expense of the ecology of the planet and the necessities of the people. It is time to declare the TPP, TAFTA and the Services agreements as dead, develop a new approach to trade and begin to renegotiate past trade agreements like NAFTA that are doing ongoing damage to the economy, planet and people.