(Photo courtesy of the St. Paul Union Advocate) Activists demonstrate outside a Wells Fargo building in downtown St. Paul, Minnesota, this past spring. L ast week, Amalgamated Bank announced that under its latest contract, all of its bank workers will earn a starting wage of at least $15 an hour. “We think it’s the right thing for our bank to do, and frankly we think it’s the right thing for all banks to do,” Amalgamated CEO Keith Mestrich told Buzzfeed News . “If any industry in this country can afford to set a new minimum for its workers, it’s the banking industry.” Though it’s not surprising that the union-owned bank is upping its wages, the move reflects a growing push among labor advocates, community coalitions, and financial reformers to improve the working conditions for the employees on the frontlines of highly profitable banking operations—the bank tellers who process your deposits; the customer-service representatives who answer your questions on the phone; the personal...
The American political system has been steadily shifting from democracy to, as former President Jimmy Carter calls it, an “oligarchy with unlimited political bribery.” According to a recent big story from The New York Times, less than 130 families and their businesses account for more than half of the political contributions to Republican contenders and their super PACs.
And a new report from the Every Voice Center, a campaign-finance reform group, offers an even clearer depiction of the increasing political inequality: Many in the donor class are also neighbors. Half of the $74 million in large individual donations to ten presidential candidates have come from just 1 percent of U.S. zip codes.
(Courtesy of Every Voice Center)
Donors living in the posh areas along New York City’s Central Park have already given more money to presidential candidates than all 1,200 ZIP codes that are majority-black. Same goes for the 1,300 majority-Latino ZIP codes. In fact, contributions from the 1,200 majority-black ZIP codes total $1.3 million, and 19 mega-donors have each already donated more than that.
(Courtesy of Every Voice Center)
As Lee Fang notes at The Intercept, the elite donor class is quite white: Of the more than 50 individuals who have already given more than $1 million to the super PACs propping up the stable of candidates (excluding Bernie Sanders), only four are not white.
It shouldn’t be surprising, then, when the Republican nominee’s platform—veiled as a “middle-class revival” plan—actually caters to a niche demographic of rich people.
There are some ways to fix this absurd disconnect in our political system. For instance, New York City has instituted a very successful public campaign-finance model that amplifies small donors with matching funds. Donors in the city’s 30 majority-black ZIP codes gave $2.1 million in the 2013 elections—more than those communities have given to presidential candidates in the last quarter.
The Brennan Center for Justice and the Campaign Finance Institute put out a fascinating study a couple years ago looking at how many more people across the city made small donations in city-council races, which had access to public-matching funds, than in state-assembly races, which didn’t.
Here’s the city’s donor distribution for state-assembly races:
(Courtesy of Brennan Center for Justice)
And here’s the city-council race:
(Courtesy of Brennan Center for Justice)
Clearly, measures like public-matching funds can expand the donor base and make candidates accountable to more people than just those who live on the Upper West Side.
This post has been updated to reflect that the Campaign Finance Institute, in addition to the Brennan Center, put out the study.
AP Photo/Alan Diaz In this photo taken Wednesday, June 10, 2015, Lashrundra Wilfork, right, helps her daughter, Nala Wilfork, fill out a job application at a job fair in Sunrise, Florida. Welcome to The Labor Prospect, our weekly round-up highlighting the best reporting and latest developments in the labor movement. O ver the past few decades, the vaunted “summer job” (the thing that would keep all these lazy college students from burying themselves in loan debt) has lost most of its purchasing power. For those with at least one foot in reality, this is not news. However, it may be surprising just how bad it has become. As NPR reports , in 1982 a college student with the maximum Pell Grant could pay for tuition by working 16 hours a week year-round (or a full-time job in the summer). Today, Pell Grant and wage levels lag behind the exorbitant cost of tuition—the same college student would have to work 35 hours a week year-round or more than 20 hours a day(!) at a low-wage summer job...
Last night, The New York Timesreported that prominent campaign-finance reformer Lawrence Lessig is considering a Democratic run for president.
His civic-minded platform is simple, and his plan is rather curious. If he can raise $1 million in small donations by Labor Day, Lessig will run for president with the sole purpose of passing legislation—the Citizen Equality Act of 2017—that would make Election Day a national holiday, end gerrymandering, and institute a robust public campaign-finance system based on vouchers and matching funds. If elected, Lessig says he will resign after passing the act.
Lessig is comparing his candidacy to that of Eugene McCarthy in 1968, who ran a single-issue campaign against the Vietnam War because he feared the Democratic Party wasn’t making it a prominent part of its platform.
The most prominent Democratic contenders—Hillary Clinton, Bernie Sanders, and Martin O’Malley—have all pledged their support of overturning the Citizens United decision. Last week, Sanders took it a step further and introduced legislation that would expand the public campaign-finance system to all federal elections.
Clinton and O’Malley have both voiced support for public campaign finance but have not come out with any sort of particular policy or plan.
Lessig is the former head of the Mayday PAC, a super PAC to end super PACs that support candidates who are committed to reforming campaign finance. The group’s efforts in 2014 were largely unsuccessful. A couple weeks ago, I spoke to Lessig’s replacement, Zephyr Teachout, about the presidential race and she made it clear that paying lip service on finance reform isn’t enough.
“[I]f you are silent on private financing in elections and aren’t actively supporting some model of public financing, that’s a problem—you’re a pro-corruption candidate,” Teachout said.
It’s interesting to note that Lessig has already targeted his most pointed critiques to Sanders’s candidacy, whose policies and supporters are most comparable to Lessig’s.
In an interview with Bloomberg’s Emily Greenhouse, Lessig articulated exactly why he thinks he is a better candidate than the Vermont senator:
“Bernie is pushing a different equality. Bernie is talking about wealth equality, economic equality. And while personally I agree with much of what he says about the incredible harm that’s been done by the incredible inequality that’s been produced, the reality is: America is not united around the idea of wealth equality the way America is united around the idea of equality among citizens. So what I’m pushing is a big idea that I think could actually unite America—and what Bernie is pushing is a big idea that, while many of us in the progressive part of the Democratic Party love it, all of America does not love.”
That’s a bold assertion to make, and he places a lot of faith in the saliency of such wonky, unsexy issues like public campaign finance and gerrymandering. But if he ends up running, it will be worth seeing what kind of impact Lessig has on Sanders’s surging momentum—and whether Hillary Clinton’s campaign will even acknowledge his existence.
When Congress passed Dodd-Frank in 2010, the most substantial piece of Wall Street reform in years, it included a provision that required most publicly traded companies to disclose the compensation ratio between its CEO and its average worker—a symbolic measure that Democrats included as a way to shine light on income inequality.
Last week (more than five years later), the SEC finally approved, along party lines, a rule that requires such disclosure. As a way increasing transparency over exorbitant executive compensation and allowing for more informed, socially-responsible investment, most publicly traded companies will now be forced to show in simple terms how many hundreds of times more its top executive is paid than its employees.
As research from the Economic Policy Institute (EPI) has shown, it will likely not be a favorable number for most corporations. In 1965, the average CEO-worker pay ratio was 20 to 1. In 2014, it was 303 to 1. The average compensation for a CEO in 2014 was $16.3 million.
The SEC rule’s passage is being lauded as a big win for financial reform advocates like Elizabeth Warren, who consistently berated the commission for taking so long to pass the mandated rule. But Republicans and the CEO lobby are feeling a little victimized and upset. A Republican SEC Commissioner, Daniel Gallagher, quipped, “To steal a line from Justice Scalia: This is pure applesauce.”
The U.S. Chamber of Commerce has dubbed it a “name-and-shame tactic,” saying in a statement: “Congress added this disclosure to Dodd-Frank as a favor to union lobbyists who misguidedly think it will help their organizing efforts. When disclosure is used to advance special interest agendas rather than provide investors with better information, it is a step in the wrong direction.”
While the SEC has said it will cost companies a measly $73 million to comply, the Chamber of Commerce contends that the costs will be an “egregious” $700 million a year.
“It’s cost without a purpose,” John Engler, president of the Business Roundtable, a Washington association of CEOs, told The Los Angeles Times.
No doubt, the powerful business lobby will continue to sound the hyperbolic alarms, claiming what seems like some pretty basic arithmetic amounts to a costly and burdensome government regulation that will stoke the class-warfare fire and force CEOs to spend their hard-earned income on anti-pitchfork insurance.
But maybe it’s a good thing that big business is a little uneasy about making public just how large its pay disparities are. While transparency doesn’t always lead to change, there are those who are optimistic that the new rule will have a real impact.
“I used to think this was symbolic,” Larry Mishel, president of the EPI, told The Los Angeles Times. “But the fact is, the pay of people in publicly held companies drives the executive pay market—for people in privately held firms, for universities, for hospitals.”