Economy

Strong U.S. Job Growth Leads to Lowest Black Unemployment in Years

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Total nonfarm payroll employment rose by 243,000 in January, and the unemployment rate decreased to 8.3 percent, the U.S. Bureau of Labor Statistics (BLS )reported Friday.

The number of unemployed persons declined to 12.8 million in January. Among the major worker groups, the unemployment rates for adult men (7.7 percent) and blacks (13.6 percent) declined in January. The unemployment rates for adult women (7.7 percent), teenagers (23.2 percent), whites (7.4 percent), and Latinos (10.5 percent) were little changed.

Black unemployment saw the biggest drop — from 15.8 to 13.6 percent. And for the first time in a long time, those numbers aren’t being fudged (much) by people who have dropped out of the workforce. Unemployment overall is at 8.3 percent now, and the BLS says that workforce participation is holding steady.

“These numbers are important because one, we now have the lowest unemployment rate in nearly three years. It’s also one of the biggest drops in black unemployment–nearly two points–that the BLS has recorded in years,” said Shani O. Hilton, Colorlines.com’s D.C. Correspondent.

“What makes this particularly heartening, though, is that unlike other points in the decline, the decline isn’t happening because Americans are giving up looking for work. The BLS reports that workforce participation is holding steady,” Hilton went on to say.

Why Black Union Workers Matter In This Year’s Super Bowl Showdown

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Why Black Union Workers Matter In This Year's Super Bowl Showdown

Indiana Gov. Mitch Daniels was not supposed to be among this year’s Super Bowl story lines. This year’s contenders, the New England Patriots and the New York Giants, should instead be taking center stage. Yet less than a week before America’s biggest sporting event of the year kicks off in Indianapolis, Gov. Daniels’  fight with the state’s unionized workers over legislation that could curtail the power of their collective bargaining rights has given a new national platform to the right wing’s bitter, decades-old war against unions.

Yet the NFL’s Player’s Association, which is the union that represents the league’s athletes, has also jumped onto the national stage and come out in opposition to the proposed Right to Work legislation. In doing so, the league’s union is taking an important, albeit symbolic, step to publicly bridge the gap that exists between the NFL’s multibillion dollar teams and its increasingly marginalized fan base. And it’s proof that sports is a powerful cultural art form that can help elevate some of today’s most controversial political issues.

On January 6, 2012, the NFLPA released a damning letter in opposition to the Indiana’s bill, which has since moved quickly through the state’s legislature.

“‘Right-to-work’ is a political ploy designed to destroy basic workers’ rights. It’s not about jobs or rights, and it’s the wrong priority for Indiana,” the statement read. “It is important to keep in mind the plight of the average Indiana worker and not let them get lost in the ceremony and spectacle” of the Super Bowl.

The statement was hugely important, considering what’s at stake for Indiana’s workers, particularly black ones. Black workers are disproportionately union members. They’re more likely than whites, Asians, and Latinos to be in public-unions, and make up 15 percent of total membership, according to U.S. Bureau of Labor Statistics. Historically, unions have been crucial gateways for black workers to earn higher wages and break into the middle class.

While supporters of Right to Work argue that the laws are needed to foster a “pro-business” atmosphere that helps generate desperately needed jobs, research has shown that the laws can have disastrous effects on workers. The Economic Policy Institute released a report in January showing that workers employed in Right to Work states makes less money and are less likely to be offered health care.

DeMaurice F. Smith, executive director of the player’s union, pressed the point even further in an op-ed published a week later in one of Indiana’s most widely read newspapers. ” An indisputable lesson of our American history is that none of those workplace protections came as a gift from corporations,” wrote Smith, who’d previously made a name for him self as a hard-nosed litigator. “Rather, all of them resulted from the ability of workers to stand united and demand change when it would have been easy to fire or silence the voice of a single worker.”

There are currently 22 states in the country that have the law, mostly in the South and in western states like Wyoming and Utah. Indiana’s bill, which the state Senate passed this week and Gov. Daniels has already vowed to sign into law, is unique because it will be the first the law that’s been put into action in an industrialized area with a large, unionized workforce.

“I don’t think it was surprising, but I think it’s important,” said Washington State University professor David Leonard about the NFLPA’s statement.

And for some observers, the reason why it’s important is because there’s been an growing divide between the league and its average fans, many of whom are people of color.

Professional football in America gained popularity as a uniquely working class sport in which teams (think the Green Bay Packers and Pittsburgh Steelers) were named after regional manufacturing economies. These days, as ticket prices have risen to the tune of hundreds of dollars for a single game, the game has become an exaggerated expression of wealth in America when many fans are struggling financially.

Larry Solomon is a longtime professor at San Francisco State University. He’s also a lifelong football fan, and has noticed that biggest enclaves of football fans are often in the most historically disenfranchised communities.

“They’re not cheering for the owners,” Salomon says of most fans. “They’re cheering for their cities, they’re cheering their friends and for people like them who identify around that team.”

For Salomon, that sort of ferver carries with it the potential for raising people’s political awareness. “When I go home and watch the Super Bowl with my family this weekend, I hope the NFLPA and the Indiana stuff comes up, but last year we talked about abortion during the Super Bowl because of Tim Tebow and his ad.

“You have these moments where sports intersects with politics, intersects with race, and you can have conversations with people who might not normally have those conversations.”

And this year is certainly one of those moments. 

“The Super Bowl is a staging ground for American Exceptionalism,” said Leonard, the professor at Washington State, noting that the Navy spends millions of dollars to do fly-overs before the game. “It’s a celebration and festival for the wealthy that’s done because of the labor of disproportionately men of color.”

That, Leonard suggests, is a macrocosm for how other industries work.

“Yes, the money is different and the stage is different, but that doesn’t mean that the lessons that we can learn aren’t there.”

Indeed, the 2011 NFL season was mired in political discussions from the start. It began with a protracted labor dispute between owners and players which lead to a lockout that lasted well into training camp. The NFLPA repeatedly emphasized how damaging a prolonged lockout could be not just to players and coaches, but also for the concession stand workers and ticket agents who work at the league’s stadiums and whose livelihoods often depend on fans showing up and spending money at games.

Another key issue that was brought up by players during the lockout is one with which many workers in other industries can relate: occupational safety.

While professional football is an admittedly physical sport and the allure of big hits has drawn in many fans over the years, the eventual price of that brutality has recently become apparent. New research has shown that players who suffer multiple concussions stand at far greater risk of developing severe depression and early onset dementia.

“I’m not sure players overall have really ‘gotten it’ with respect to the extent to which the money they make can be fleeting, but I think they’re beginning to get the idea that their health, their vibrancy can be fleeting,” said N. Jeremi Duru, a professor at Temple University and author of the forthcoming book “Advancing the Ball: Race, Reformation, and the Quest for Equal Coaching Opportunity in the NFL.” He maintains that players’ increased awareness has made them more willing to protect their physically interests, and thus has created a climate in which their union’s support of other worker’s struggles isn’t all that surprising.

“The unanswered question is whether any of the players participating in the Super Bowl will say anything,” says Dave Zirin, a columnist at The Nation and author of “Bad Sports: How Owners are Ruining the Games We Love.” Though Zirin cautions that it’s not something fans should expect, he also thinks that if players do participate, the issue of worker’s rights in Indiana would get attention that’s “out of this stratosphere.” 

University of Alabama Economist Study Says HB 56 Will Cost State $2.3 billion and 70k Jobs

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A new study from economist Dr. Samuel Addy, director of the Center for Business and Economic Research at the University of Alabama, provides evidence that “HB 56 has been, and will continue to be an economic disaster for the state of Alabama.” Dr. Addy concludes that “Instead of boosting state economic growth, the law is certain to be a drag on economic development even without considering costs associated with its implementation and enforcement.”

Among Dr. Addy’s key findings:

  • By driving some immigrants out of the state and others underground, the law will damage the economy by shrinking demand for the goods and services that Alabama businesses provide. Dr. Addy estimates that HB 56 will shrink the state’s GDP by at least $2.3 billion (1% of the state’s 2010 GDP), and possibly as much as $10.8 billion (6% of 2010 GDP).
  • Supporters of HB 56 have misleadingly pointed to the declining unemployment rate among Alabamians to argue that the law is “working.” However, Dr. Addy points out: “recent data show employment falling in the four sectors (agriculture, construction, accommodation, and food and drinking places) that are often alleged to employ migrant and unauthorized workers.” Dr. Addy estimates that the law will ultimately cost Alabama 70,000-140,000 jobs.
  • The supporters of HB 56 who deny that immigrants pay taxes might be surprised to learn that HB 56 is costing the state $57-$265 million in state taxes, with an additional $20-$90 million loss in local sales taxes. This is a staggering cost to the state budget even without considering the costs of enforcing the law and defending it in court all the way to the U.S. Supreme Court, which will cause the cost to balloon even more.

Addy also lays out common arguments among HB56  supporters and goes on to dispel the so called “economic benefits” of the law:

  • Saving funds used to provide public benefits to illegal immigrants
    The two most common benefits that illegal immigrants are said to enjoy are healthcare services at emergency hospitals and clinics and educational services (mainly for their children). No one knows for sure how much savings will be generated because of the significant uncertainty regarding the hard data required. However, as unauthorized immigrants try to avoid notice as much as possible any such savings is likely to be small.

  • Increased safety for citizens and legal residents
    This benefit depends on whether illegal immigrants commit crimes and endanger public safety at a higher or lower rate than citizens and other legal residents. There is a benefit only if the rate is higher for illegal immigrants. Considering that most illegal immigrants are seeking to better their lot, it is more likely that the rate would be lower for them.

  • More business, employment, and education opportunities
    It is generally accepted that unauthorized immigrants work for low wages. As such, the absence of illegal immigrants is likely to improve competitiveness for businesses that found it extremely difficult to compete because they do not use such labor. This might make the business climate attractive for out-of-state businesses that do not use illegal immigrant labor to consider relocating to the state. Such benefits for some businesses do not translate into a benefit for the aggregate economy because they cannot fully make up for the reduced demand caused by the absence of unauthorized immigrant workers.

  • Ensuring the integrity of various governmental programs and services
    This can only be a benefit of the immigration law if illegal immigrants use governmental programs and services dishonestly. Because they wish to remain undetected, illegal immigrants usually apply for services for their legal children when required to by state and national laws; sometimes these laws specify provision of the services to children.

The full report “A Cost-Benefit Analysis of the New Alabama Immigration Law” is available below. [PDF]
New AL Immigration Law – Costs and Benefits

What Would it Cost to Deport All Undocumented Immigrants? $285 Billion

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Business Insider has gathered data from both ICE and third party reports and estimates a mass deportation campaign over five years would cost $285 billion.

Apprehensions average at $18k, detention at about $3k, legal proceedings and transportation come in close to $2k and it all adds up to a whopping $285 billion.

More from Business Insider:

A year ago, Immigration and Customs Enforcement (ICE) deputy director Kumar Kibble told Congress it costs about $12,500 to deport an undocumented immigrant.

However, a 2010 report by Center for American Progress and Rob Paral and Associates took a close look at all the budget appropriations for ICE and broke down the costs per person for each one of the four stages of deportation process: apprehension, detention, legal proceeding and transportation. The whopping cost of deportation per person that they came up with is $23,480.

The report states that ICE and US Customs and Borders Protection budgets have increased by 80% since 2005, amounting to $17.1 billion in FY2010. If US were to undertake a mass deportation campaign its cost over five years would be $285 billion, which “would mean new taxes of $922 for every man, woman, and child in our country. $5,100 fewer dollars for the education of every public and private school student from prekindergarten to the 12th grade.”

Visit Business Insider for a more detailed breakdown of the numbers.

How San Francisco Organizers Rewrote the Rules to Save Minimum Wage [Video]

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On Jan. 1, 2012, San Francisco’s minimum wage became the first in the nation to pass the $10 mark. The lowest-wage workers will now earn $10.24 an hour, up from the previous rate of $9.92 last year. The city’s minimum wage is tied to and adjusted for inflation, or specifically the Consumer Price Index for the San Francisco Bay Area. For most of the country the minimum wage is not at all tied to inflation, and therefore has lost value in real terms.

But San Francisco’s is different because of a law enacted as a result of Proposition L, a city ballot measure fought for and won by a coalition of organized labor and a diverse network of community-based progressive organizations back in 2003. The alliance was particularly rooted in communities of color and pushed by low-wage workers not typically represented by traditional unions.

After the passage of Proposition L, the new minimum wage started at $8.50 in 2004, and has risen incrementally since to its present value. However, this is still far below a living wage, especially in San Francisco, a city with one of the highest costs of living in the country. Additionally, a range of issues such as a housing shortage, little access to healthcare, and wage theft among others make it increasingly difficult for the city’s low-wage workers.

In response to these challenges, the coalition of community organizations that united to bring about the minimum wage increase has continued to work together over the past several years to tackle the range of the issues affecting their memberships. Uniting under the banner of the Progressive Workers Alliance, groups from across the city representing historically-marginalized communities very consciously have chose to organize using a multiracial model, uniting a broad base of affected workers.

The Progressive Workers Alliance itself is a lesson the individual organizations have learned from the minimum wage fight of 2003. In coalition the groups have realized their impact is larger, and their power has increased. They are using this to better advocate for their memberships’ economic interests, and affect change on a grander scale.

To help tell this story, Colorlines.com spoke with Jaron Browne and Donaji Lona from People Organized to Win Employment Rights (POWER); Shaw San Liu from the Chinese Progressive Association; Renee Saucedo from SF Day Laborer Program and Women’s Collective; and Ken Jacobs from the UC Berkeley Labor Center.

Obama’s Big Shift: Let’s Truly Investigate the Banking Sector’s Crimes

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Obama's Big Shift: Let's Truly Investigate the Banking Sector's Crimes

President Obama said many things at last night’s State of the Union, but the speech really boils down to two very big statements–one about values, the other about policy.

The values statement is rightly getting lots of play this morning: Obama’s core message between now and November will focus on economic inequality, specifically, and equal opportunity broadly. Obama grabbed hold of the debate over taxes and reframed it as a debate over opportunity and fairness. That’ll be a welcome change for the broad swath of communities from which Democrats are seeking support, not just for Obama, but for congressional races as well.

The policy statement last night is an equally huge deal. Obama announced a new task force to investigate financial industry crimes surrounding the mortgage crisis; the unit is to be led by the New York State Attorney General Eric Schneiderman. That appointment alone is a big deal: Financial reform advocates love Schneiderman because he’s been one of few public officials to insist that someone still must be held accountable for the multiple forms of fraud that large financial players committed during the housing boom. Moreover, he’s insisted that the people who lost their homes and their hard-earned wealth in the process deserve restitution. That’s a conversation the White House has avoided like the plague since the day it took office. Last night’s announcement marks a dramatic shift.

The question remains whether Schneiderman’s unit will be window dressing for a get-out-of-jail-free settlement with banks that are currently facing heat from state attorneys general over fraudulent foreclosures.

Here’s the reaction from the New Bottom Line, a relatively new coalition of homeowner advocates and community groups that had been making this very demand loudly for years:

President Obama has heard the calls of the 99% and announced a full, federal investigation into the fraudulent activities of big banks…. We will continue to make sure that this investigation uncovers the truth about the activities of the big banks. And in order to provide real and meaningful relief to millions of homeowners, the end result must be at least $300 billion in principal reduction and restitution for those who have lost their homes, especially targeted at the most hard hit communities. This will reset the housing market and the economy.

I’ll have more on the unit and what it means later this week.

Strong Consumer Financial Protection Bureau Could Protect Latino and Black Borrowers

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From 2004 to 2008, only 6.2 percent of white borrowers with credit
scores of 660 and above ended up with higher-rate mortgages. Latinos and
blacks with good credit scores, however, were three times as likely to
end up with higher-rate mortgages, according to an analysis published Thursday by Algernon Austin, director of the Economic Policy Institute’s Race, Ethnicity, and the Economy program.

epi.pngThe Fair Isaac Corporation–the company that created the FICO score–classifies scores of 660 and above as “good,” but  Austin explains that black and Latino borrowers with a credit score of 660+ still received higher interest rate loans that resulted in higher foreclosure rates. “Higher foreclosure rates of these groups help explain why Latinos and blacks have seen such dramatic declines in wealth,” Austin wrote in his analysis available on EPI’s site.

“Discriminatory housing practices are one reason why our country needs
a strong Consumer Financial Protection Bureau,” Austin went on to explain. “A powerful CFPB helps
make sure that everyone is treated equally and fairly by the financial
services industry.”

Colorlines.com’s editor Kai Wright points out that been a recurring claim since the beginning of the housing crisis that
people who didn’t deserve loans got them. “The not-so-subtext of that has
been an attack on government programs that encouraged lending to black
and Latino borrowers. The claim has been demonstrably false from the
start, though it still gets repeated without challenge in mainstream
media.”

“This study is but the latest to make the point clear: We’re in
this crisis because the financial sector deliberately preyed upon
borrowers of color, who were left vulnerable after being locked out of
the legitimate credit market for generations,” Wright went on to say. 

Gingrich Surges With Old, Familiar Ploy: Racist Attacks on Poor People

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Gingrich Surges With Old, Familiar Ploy: Racist Attacks on Poor People

Newt Gingrich looks to be winning the race-baiting competition this Republican primary season. Fueled by a new version of his well honed attacks on the safety net, Gingrich celebrated Martin Luther King Day on Monday by restating what has become a staple of his stump speeches, calling President Obama the “best food stamp president in American history.”

The remark came, this time, after debate moderator Juan Williams asked if Gingrich’s campaign-trail suggestion that poor students be given jobs as janitors might me “viewed at a minimum insulting to all Americans, but as particularly to African Americans?” “The fact is that more people have been put on food stamps by Barrack Obama than any president in American history,” Gingrich said before an audience that erupted into vociferous applause.

Gingrich argues that the reason so many people are on food stamps is not that the economy has thrown millions into poverty, but rather that lazy black families are getting on the dole and don’t want to work. Earlier this month, Gingrich told an audience in New Hampshire, “If the NAACP invites me, I’ll go to their convention and talk about why the African-American community should demand paychecks and not be satisfied with food stamps.”

Gingrich’s attack on the food stamp program is not surprising; it’s the kind of politics that he’s been helping to perfect for over 30 years. He’s been waging the conservative counterrevolution against economic justice for a generation, using whatever Southern Strategy relics he can get his hands on.

For two decades, Gingrich and the GOP, often with the support of Democrats, have torn to shreds many of the New Deal and Great Society era programs that kept poor folks from total destitution–and that specifically sought to close the racial gaps in economic opportunity that black children inherit from generations of American apartheid. The conservative assault on these programs has often come with racially loaded caricatures of benefit recipients as lazy, greedy and criminal.

Yet, the food stamp program is among the last functional parts of the nation’s economic safety net. Food assistance has actually expanded to meet growing need.

The program, now officially called the Supplemental Food Assistance Program, serves 46 million Americans, 13 million more than in January 2009 when Obama took office. While cash assistance, Section 8 housing assistance and other programs have been slashed close to death, food stamps have held on and expanded thanks to an infusion from the stimulus package. For many families, it’s now the only thing that’s stopping hard times from turning into total catastrophe.

As I reported at the beginning of the recession, some families who can’t access cash assistance or unemployment insurance because of restrictions on those programs are now living on food stamps alone.

The program was spared from attack for a time, as more Americans signed up for help. The New York Times reported in late 2009 that as food stamp enrollment grew and families applied for help who’d never sought assistance before, the stigma that was once thrust upon the program had cleared.

But the Republican Party is not known to let a functioning safety net program function, especially when demonizing it can help them win elections. So Gingrich and other GOP hopefuls have set food stamps in their sights, doing all they can to infuse the program with the kind of racialized stigma that’s taken down other core safety-net programs. From a campaigning point of view, the strategy appears to be working. Gingrich’s South Carolina polling numbers jumped following his latest race-baiting foray, bringing him within striking distance of Mitt Romney.

Gingrich is not the only Republican candidate who’s attacked the food stamp program, though. Ron Paul, of course, would decimate all government safety-net programs. And even more troubling, front-runner Romney said during a New Hampshire primary debate, “I’d cut programs, a whole series of programs … return to states a whole series of programs, food stamps, housing vouchers, Medicaid…”

When Gingrich and President Bill Clinton passed the welfare reform bill in 1996, the federal income assistance program was devolved to the states and ceased to be an entitlement. Suddenly, very poor families were not entitled to income support and those who could access the program were subject to sanctions and work requirements that made it hard to stay on the rolls, and even harder to use the support to get out of poverty. States chopped the welfare program, now called Temporary Assistance for Needy Families, by the millions and imposed draconian restrictions, including time limits that cut families off of assistance after as little as 21 or 24 months.

The result of all of this: Welfare rolls plunged, but poverty did not. And low-income women were left without any buffer in a low-wage economy that simply does not pay enough to support a family.

Like Romney, Rick Santorum wants to subject food stamps to similar reforms.

“Food stamps is another place, we gotta block grant it and send it back to the states just like I did on welfare reform… require work, and you put a time limit on it,” Santorum said.

These are ideas that Gingrich as been spreading since he was first elected to office in 1979. In fact, Santorum once called himself “a disciple” of Gingrich.

For those true believers in trickle-down economics (who unfortunately populate all of the Republican party and much of the Democratic one), unemployment can’t be addressed by fixing a broken economy. For Gingrich and friends, since the free market is fundamentally sound, the explanation for high unemployment must be that the workers don’t want or don’t know how to work.

Incidentally, the majority of the 46 million people who rely on the food stamp program are actually seniors of retirement age and kids, not working age people. Which leads to the next piece of the Gingrich plan to fight so-called food stamp dependency and willful unemployment: put 11-year-old kids to work.

Gingrich told a crowd at a December fundraiser that “really poor children in really poor neighborhoods have no habits of working and nobody around them who works.” He said that the solution to joblessness and poverty could be to “hire 30-some kids to work … for the price of one janitor.” So Gingrich would solve the jobs crisis by compelling middle school children to clean their schools.

Newt Gingrich has done as much to wreck the federal safety net and translate the Southern Strategy into the post-racial era as anyone in Washington. His chances of gaining the Republican nomination are slim, but the war against poor people that Gingrich has lead is well entrenched. Regardless of who wins the GOP nomination, Gingrich’s legacy will carry on.

There was Virtually No Change in Black Unemployment Rate in 2011

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A new report by UC Berkeley’s Center for Labor Research and Education finds that throughout 2011, black worker unemployment remained in the 15 to 16 percent range, while unemployment for the rest of the workforce dropped below 9 percent.

“The jobs gap between black and white workers is a story that we’ve seen for more than 50 years, but this report shows that unemployment rates for Black workers have not fallen as much as they have for their white and Latino counterparts,” said Steven Pitts, a labor policy specialist at the center and author of the report.

The report also found when black women and black men are examined separately, black female unemployment rates rose, while black male unemployment rates fell.

For more information and to download the report visit the Center for Labor Research and Education.

What Percent Are You?

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The large majority of people in the United States are part of 99%. But have you ever wondered if you’re closer to the 1% or the 99%? The NY Times has a quick and easy to use tool that will tell you where you and your household income stand in relation to the rest of the country.

And if you find yourself in the single digits (or even a double digit) please, by all means, hit that red donate button at the top of the page.

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