History was made yesterday. The American people demanded an economic bailout strategy that helped Main Street as well as Wall Street. When congressional leaders came up short, fierce public pressure forced the House to vote “No.”
But, with the financial crisis deepening, saying “no” is not enough. It’s time to act.
Tremendous pressure is already mounting from the White House and Wall Street to exploit people’s anxiety, dress up the same weak bill and ram it through this week! Congress needs to hear from you NOW, to resist this pressure and take a stand to rebuild Main Street and reign in Wall Street. Tell Congress: Resist Wall Street. Stand up for Main Street. Deliver a new “New Deal.” The defeated bailout package promised more failed trickle-down logic — bailout the financiers at the top and prosperity would trickle-down. To get the economy back on track, we need a new “New Deal” that rebuilds the economy from the bottom up.
• Invest In Main Street: On Main Street, jobs are disappearing, infrastructure is crumbling and local budgets are straining. A $200 billion economic rescue package for Main Street would generate clean American energy, extend unemployment benefits, aid states and localities to avoid debilitating cuts and modernize our crumbling infrastructure.
• Save The Homeowners: Defaulting mortgages are at the heart of the crisis. Keeping deserving people in their homes is critical to shore up Main Street and Wall Street. The bankruptcy courts need to have the power to renegotiate mortgages and reduce foreclosures.
• Hold Wall Street Accountable: Instead of simply propping up reckless firms, we should establish a Reconstruction Finance Corporation that can take over financial firms, sort out the solvent from the insolvent, close down some and merge others. We also need modern regulation that cracks down on the abuse. And taxpayers deserve preferred shares in any bank or investment house that we are forced to rescue.
This sort of new “New Deal” economic rescue plan puts Main St. first. It’s what Congress should have done from the start. Tell Congress now: Resist Wall Street. Stand up for Main Street. Deliver a new “New Deal.” Make no mistake, the financial crisis is serious and severe. Big problems require bold solutions. And problems caused by conservative policies need progressive answers.
Conservatives are regrouping now. They’ll try to put progressives on their heels, and pander to Wall Street with more deregulation and top end tax cuts — the same conservative policies that derailed the economy and ravaged the markets in the first place.
You beat back Wall Street once, but their pressure will not let up. Congress needs to hear your voice again NOW to build on this stunning victory. Your voice already stopped a bad bill, now it can pass a good one. Tell Congress: Resist Wall Street. Stand up for Main Street. Deliver a new “New Deal.”
Posted
September 24, 2008 at 10:00 pm,
in
From the News
By Dean Baker
Co-Director, Center for Economic and Policy Research
With all the urgency and frenzied debate around the Wall Street bailout, it is important that we not forget to still have some fun. With that thought in mind, let’s take a moment to mark the sudden transformation of the Wall Street free trade crowd, led by several of the top figures in the Clinton administration, into the Wall Street protectionist crowd.
As Wall Street free traders, these folks argued that we should get the government out of the economy. They wanted to remove the trade barriers that obstructed the free flow of goods and services (especially goods). If this meant that workers had to lose their jobs, so be it. Because they were nice guys, they promised benefits like job training and wage insurance.
But now the Wall Street crew no longer wants to leave things to the market.
Virtually all financial firms are now counting on the Securities and Exchange Commission (SEC) to prop up their stock prices by prohibiting short sales. It seems that there are many investors who think that Goldman Sachs, Morgan Stanley and the rest are not worth their current market price and are willing to bet that their price will fall.
However, at the urging of the Wall Street former free traders, the SEC has made it illegal for these investors to trade based on their assessment of market values. Of course such government intervention distorts market prices and leads to inefficiency. If the shorters are wrong and the banks are really worth more than they believe, their shorting efforts would allow other investors (including the former free traders) to swoop in and buy up shares at bargain basement prices. They actually should be delighted that the shorters are giving them such great buying opportunities.
But, the Wall Street crew is not very sophisticated when it comes to economics. So, rather than let the market run its course, they go running to the government for protection. And, being somewhat more powerful than autoworkers and textile workers, the Wall Street crew has been able to get their protection.
So, there you have it. The Wall Street free traders are now protectionists. It’s a new day. (btw, someone should check the listings to see if any of the big shareholders took advantage of the moratorium on shorts to dump large amounts of their holdings.)
Call it extortion. Every American is now being told to ante up $2000 – an estimated $700 billion in all – to bail out the banks from their bad bets, or they’ll bring down the entire economy.
In the speculative frenzy that allowed the Masters of the Universe to pocket millions personally, the banks filled their coffers with toxic paper that no one wants to buy. Now they sensibly don’t want to lend money to each other, since no one knows if the other is solvent. So they go on strike, and threaten to trigger a global depression, if they don’t get rescued. (for more details go here.)
The bail out will take place simply to avoid that depression. But depressions have some salutary effects – the scoundrels go belly up, the weakest get purged. And, in the wake of the disaster, people demand strict regulation of the money lenders to keep their greed in check, and government spends money on the real economy to put people back to work.
So if we’re going to ask Americans to pay to avoid the depression, we better demand the accounting that wouldn’t otherwise take place.
We need a citizens’ plan on the crisis. Here’s a first draft, derived from discussions with a range of independent experts.
No bail out should go forward without the following minimal conditions:
1. Taxpayer money; taxpayer accountability.
The Treasury wants unlimited authority to spend $700 billion in a revolving fund with no rules beyond its own discretion. We can’t trust the most spectacularly corrupt administration in memory to decide how they’ll cut the deals with the banks. We’d get fleeced. Instead, the law must require an independent entity, with consumers and workers having a majority of the seats on a board with authority to create rules that will prohibit gaming of the bailout. And the Congress – itself sadly compromised by Wall Street money – should be empowered to name independent monitors and to approve all board members.2. Taxpayers share in the upside.
The Treasury bill would buy the bad paper of firms without taking any equity in the firm. That’s an invitation to larceny. If a firm decides to auction off its toxic paper to the US agency, taxpayers should get equity in that firm, in proportion to the assets we buy. That will deter profitable firms from using the agency as a dump for their toxic paper. And it will insure that if the bailout works and the firms become profitable, taxpayers, not simply bankers, benefit from the upside. 3. Shut down the casino.
No bailout of the predators can go forward without new regulation for the financial system – capital requirements, leverage limits, bans on exotic instruments, transparency, limits on compensation schemes. The shadow banking system – hedge funds, private equity firms – must be brought under the glare of regulators. The Federal Reserve should be directed to police asset bubbles. Over the counter trades – like the credit default swaps – should be brought into public exchanges. Some details should be written into the law; Treasury can be mandated to issue more comprehensive regulations by a date certain, with fast track rules for consideration by the Congress. One thing is clear: any promise to do the bail out now and the regulation later is simply a lie. 4. Curb excessive CEO pay.
Wall Street fatcats shouldn’t be pocketing millions taxpayers are forced to bail them out. Any firm that applies for relief must agree to limit the compensation of any executive – pay, bonuses and perks – to no more than the highest pay offered a senior federal official. Future compensation should be linked to profitability.5. Invest in the real economy.
Ending the bankers strike is not sufficient to avoid a serious recession, as consumers tighten their belts. A major public investment agenda – $200 billion or more – for developing new energy and conservation, rebuilding schools and infrastructure, extending unemployment and food stamps, helping states avoid crippling cuts in police and health services – is vital to get the real economy moving and put people back to work. If we don’t do this, the coming recession will raise the cost of the Wall Street bailout dramatically, as credit card, auto and home loan defaults rise.6. Aid the victims, not just the predators.
No bail out of the banks can take place without a freeze on foreclosures and renegotiation of bad mortgages so people can stay in their homes. Bankers and home owners both made a foolish bet that home prices would keep rising. Many homeowners were misled by predatory lenders to taking mortgages that they didn’t understand and couldn’t afford. It would be simply obscene to help the predators and not those that they preyed on.7. Curb the political corruption.
No contributions from Wall Street PACs or executives should accepted by any legislator or candidate for national office. Paid lobbyists of Wall Street firms should be banned from any legislative contacts. Any meeting with representatives of Wall Street – and many will be needed to understand what is happening – should be posted immediately by legislators in a central place on the web. All those employed over the past five years by troubled firms seeking relief should be prohibited from profiting from the bailout. Without this ban, legions of executives from Bear Sterns or Lehman Brothers will create consulting firms to profit from cleaning up the mess that they made.
These demands will be met with howls of outrage, a renting of pinstripes. It will require a Congress, lathered with Wall Street contributions, to demand a deal that makes sense. This won’t be easy, particularly with Republicans apparently lining up en mass to rubber stamp the Bush administration proposals. But trusting this administration to decide without conditions on how to bailout the banks with $700 billion in taxpayers money is simple lunacy.
These banksters have brought the global economy to the brink of the abyss. They want to use that crisis to give the Treasury a virtual blank check to bail them out. Counting the money already spent, more than a trillion dollars will be spent rescuing them from the mess that they have made. Before agreeing to that, Congress has to demand common sense conditions that insure the taxpayers won’t get fleeced, and this won’t be done to us again.
Make your voice heard. Add your comments below. Write Senate Majority Leader Harry Reid, House Speaker Nancy Pelosi and demand that they stand up. Write Senate Republican Leader Mike McConnell and House Minority Leader John Boehner and tell them that saluting the Bush administration is not sufficient. Tell the Committee Chairs Senator Chris Dodd and Rep. Barney Frank that the Treasury proposal is unacceptable. Finance is too important to be left to the bankers. And the bailout is too costly to be left to the Bush administration.
Posted
September 17, 2008 at 5:57 pm,
in
From the News
By David Sirota
Author of “The Uprising: An Unauthorized Tour of the Populist Revolt Scaring Wall Street & Washington”
Last night on MSNBC, Rachel Maddow and I discussed John McCain’s new rhetoric claiming he supports better financial regulation.
But instead of focusing only on McCain’s words, we tried to follow in the spirit of the Institute for America’s Future’s call for a substantive debate by examining the Arizona senator’s career as a public official – one who’s formative regulatory experience was being a member of the Keating Five pressing federal financial regulators to stop doing their job in advance of the S&L crisis (ie. the most analogous crisis to today’s Wall Street meltdown). You can watch the conversation here:
McCain, as the S&L scandal first suggested, is no run-of-the-mill free-market fundamentalist. Yes, he voted for the ill-advised repeal of the key Depression-era law that might have prevented the rampant consolidation and speculation that brought on today’s emergency.
But, then again, Bill Clinton and his DLC Democrats supported it too. Yes, McCain’s top economic adviser is Phil Gramm, the UBS investment banker who pushed through so much deregulatory legislation as a senator. But then again, Barack Obama’s top economic adviser is Robert Wolf, Gramm’s UBS boss.
Where McCain really leaps to the fringe and differentiates his extremism from others is in his use of the deregulatory label to publicly define himself. That’s how you can really tell what a politician believes in.
This is not a guy who just votes for the corrupt legislation his Wall Street friends tell him to vote for – this is a guy who has staked his name on being “fundamentally a deregulator,” as he recently described himself.
On 11/19/93, McCain took to the Senate floor to support an early financial deregulation bill and decry what he called “the tremendous regulatory burden imposed on financial institutions.” The guy who now claims to be the trustbusting Teddy Roosevelt back then lamented “the rapidly increasing regulatory burden imposed on banks is to cause them to devote substantial time, energy and money to compliance rather than meeting the credit needs of the community.”
Ten years later, McCain was bragging to the Associated Press that “I have a long voting record in support of deregulation,” and to CNN that “I am a deregulator. I believe in deregulation.”
And, during this year’s presidential campaign taking place in the shadow of financial meltdown, McCain was only months ago insisting on PBS that “we need less government [and] less regulation” and that “I’m always for less regulation.”
Of course, there’s plenty of good news for both Democratic partisans and ideological progressives about McCain’s about-face.
For partisans concerned only about Obama winning the election, McCain’s 180 on regulation opens up an obvious chance for Democrats to label him a against-it-before-I-was-for-it, say-anything-to-get-elected hypocrite – and Obama is (finally) moving to seize that opportunity.
For ideological progressives long fighting the good fight to resurrect the common-good regulatory agenda of the New Deal, McCain’s shift reflects a broader shift in the public debate. Suddenly, regulation isn’t a four-letter word anymore. Suddenly, even John “I’m always for less regulation” McCain is for regulation. That rhetorical shift could help create an election mandate forcing whoever wins the presidential contest to actually move away from Reagan-style extremism for the first time since, well, Reagan.
But as I told Maddow (and as I will examine further in my upcoming newspaper column on Friday), we have to all follow the money and the actions. Both Obama and McCain have taken huge sums of cash from the industries that caused this crisis. Both Obama and McCain continue to rely on Wall Streeters who engineered the meltdown as their top economic advisers (though only McCain employs lobbyists intimately involved in the crisis). That kind of influence doesn’t just slink away with a boom-bust crisis – it fights hard to make sure nothing concrete comes out of the situation (think the weak Sarbanes-Oxley after Enron).
Whether we get the kind of populist reforms will be decided by how much grassroots pressure is put on either of these potential presidents when they reach the Oval Office. The talk right now from both candidates may be good – and Obama is smart to point out McCain’s absurdly dishonest rhetoric. But talk is cheap when it comes time to write legislation.
John McCain should not be traveling in a bus called the Straight Talk Express.
No, that equivocating multimillionaire who kowtows constantly to the wealthy should be riding in one of those private, gilded railroad cars.
That would be symbolically appropriate as well since he is trying to railroad the middle class on taxes.
He is actually proposing a brand new tax on the middle class.
This has gotten so little attention it is astounding. And frightening, frankly, as television reporters and commentators focus instead on inane incidents like the lipstick-on-pigs remark.
McCain intends to tax workers for the value of health insurance that they receive from their employers.
Really.
Although it’s not included in the description of his plan on his web site. It is, however, on the site of the Henry J. Kaiser Family Foundation, a non-profit organization that specializes in health policy.
I understand McCain neglecting to mention this new tax on the middle class. If I were proposing this shocking tax increase, one that will cost the average American worker an additional $110 a month in taxes out of the blue, I would conceal it as best I could too.
Taxing health insurance
So let me provide you with some clarity. This comes from the Kaiser Foundation evaluation of the McCain and Barack Obama health plans. It says McCain would “reform the tax code to eliminate the exclusion of the value of health insurance plans offered by employers from workers’ taxable income.”
The value of the typical plan provided by an employer to a family is $12,106, of which the employer pays $8,824, and the worker pays the remaining $3,282. The median household income is $44,389, which places most American families in the 15 percent income tax bracket.
McCain wants to add the employer’s cost — an additional $8,824 — to that middle class family’s income, then tax it. The hit to the average family is 15 percent of the McCain-added income — $1,323 more in income taxes.
This new tax would affect the 158 million Americans who are insured through their employer.
Right now you should be yelling, “What?” And demanding to know why you haven’t heard about this before. That is because the media keeps focusing on McCain’s proposed health care tax credits — $5,000 for families and $2,500 for individuals.
McCain certainly wants the attention to stay on those credits. It sounds so much better to be giving families tax credits than tax increases. But what you need to know about those tax credits is that they don’t go to you – they’re to be sent to the insurance companies. You never get actual money in your pocket. McCain says it right on his web site: “the money would be sent directly to the insurance provider.”
So if you choose to remain with your employer-based insurance, there’s no guarantee that you’ll ever see any benefit from that $5,000 payment. In addition, giving young healthy workers $2,500 to buy insurance on their own, where it won’t be taxed, will encourage them to leave employer-based plans, quickly raising the costs for everyone remaining and thus eliminating benefits of the tax credits. Finally, the tax credits rise only at the rate of inflation, not the vastly faster rate of medical costs, so, again, their value will quickly erode, according to several studies, including one released last week by health economists from Columbia, Harvard, Purdue and Michigan and published in the journal “Health Affairs.” New tax
Still, somehow, no one mentions the new tax part of McCain’s plan!
Even the credits don’t sound so great after you hear the whole story.
John McCain wants to kill employer-provided health insurance. He wants every American to go out on his or her own and try to buy insurance. He says that on his site if you read between the doubletalk. He says, for example, “The key to health care reform is to restore control to the patients themselves.. . .Health care. . . should not be limited by where you work.”
Here’s the way the New York Times put it in an April 30 story, in which there was only straight talk: “Mr. McCain’s health care plan would shift the emphasis from insurance provided by employers to insurance bought by individuals.”
Since 2000, the percentage of employers offering health insurance has declined from 69 percent to 60 percent. Many more companies would dump their plans as soon as the federal government offered tax credits to individuals who bought their own. Corporations would disingenuously justify this abandonment the same way McCain does — by saying workers would get the advantage of carrying their individual plans from job to job as they move around the country.
They won’t mention the cost, however. To buy plans comparable to what workers now receive from employers, families are going to have to shell out a lot more money from their own pockets.
The math is simple. To buy the $12,106 plan with the $5,000 family tax credit, a worker is going to have to cough up an additional $3,824. (That is the $8,824 the employer previously paid toward the plan minus the $5,000 credit.)
That is, assuming, of course, that you can get coverage. Insurance companies are notorious for rejecting anyone with pre-existing conditions, including acne, being overweight and diabetes.
McCain wouldn’t qualify
John McCain himself would likely be unable to find an insurer on the private market since he’s had the most serious form of skin cancer, melanoma, more than once.
But he doesn’t have to worry because, as a U.S. senator, he’s covered by a government plan. And he’s certainly not proposing eliminating that!
McCain could resolve the exclusion problem by requiring insurance companies to accept people with pre-existing conditions. But he doesn’t. Instead, he suggests setting up a system in which states would become responsible making sure those people get insurance. He says he won’t shift the costs to the states, but what’s the chance of that? He’s establishing a pool of all of those rejected by insurance companies – thus those with the highest risk. And he’s telling the states to deal with the problem that creates.
Meanwhile, insurance companies would be left to profit big time by providing insurance for the young, the healthy and everyone who doesn’t have anything at all wrong with them. What a deal!
He claims this plan will increase competition and drive down prices – as if an individual worker, on his own, without any real knowledge of the system, has the negotiating power of a major corporation with full-time experts on its staff whose only function is to buy insurance for a pool of hundreds or thousands of workers.
While McCain is planning to increase your taxes if you’ve got insurance at work or to force you into the insurance market at a huge financial loss, he intends, at the same time, to cut taxes on corporations — you know, like those giant oil companies that just raked in the largest quarterly profits of any firm ever in the history of mankind. And he plans to permanently retain those income tax cuts his friend George W. Bush gave to the rich, because, of course, the wealthiest Americans, like McCain and Bush, need a break today.
Lying to American workers
In the meantime, McCain is traveling to states like Michigan, Ohio and Pennsylvania, hard hit by the economic devastation caused by eight years of Bush administration fiscal policy failures. At each stop, McCain is sucking up the middle class – as if his administration wouldn’t cost workers dearly.
He needs to stop lying to America’s workers.
In fact, maybe Mr. Straight-Talk-Express needs to slap on some lipstick. Because sometimes the truth is a bitch.
By David Sirota
Author of “The Uprising: An Unauthorized Tour of the Populist Revolt”
Last night, I appeared on Rachel Maddow’s new MSNBC show to discuss John McCain’s new ad attacking Barack Obama on education. You can watch the discussion here:
In airing this ad, McCain has done something I never thought I would see: He has sponsored a new television commercial that effectively declares his support for child molester rights.
I’m dead serious here: The ad explicitly criticizes Obama for supporting state legislation that the Kansas City Star notes was designed to give “schools the ability to warn young children about inappropriate touching and sexual predators.”
So by basic logical deduction, then, McCain’s ad attacking Obama for supporting that bill means McCain would have opposed it – meaning he would have taken the side of the Pedophilia Lobby that wants young children to not understand when they are being molested. I’m wondering – is there a NAMBLA endorsement in the works for McCain? The Arizona senator sure seems to be courting that interest group with this latest declaration.
Of course, McCain’s ad is aimed at pushing the kind of cultural populism Republicans have been using for at least a generation. In this case, McCain is willing to put himself on record as supporting child molesters, as long as it helps him depict Obama as not just a child molester supporter, but a child molester himself – which is what the ad’s voiceover basically suggests when it hysterically implies State Senator Obama tried to fondle small schoolchildren while whispering sweet porn nothings into their ear.
Put into pop culture terms, this is McCain’s effort to turn the 2008 presidential campaign into the infamous, multi-part Different Strokes child molester episode – starring Barack Obama as the pedophile.
On Rachel’s show last night, we discussed how Obama can – and should – respond to this kind of cultural populism. I reiterated that, in general, he needs to do what I suggested in a newspaper column a few months back: namely, voice strong economic populist themes that keep the campaign debate focused on the issues of most import, and that Democrats win on.
In specifically responding to this ad, I told Rachel that Obama has to learn a lesson from perhaps the most famous of failed methods of responding to such issues – the one from the 1988 presidential debate, where Michael Dukakis answered Bernard Shaw’s question about raping and murdering Kitty Dukakis not with an emotional attack on Shaw’s inappropriate inquiry, but with dispassionate platitudes. Watch that moment here:
If Obama reacts forcefully and emotionally to McCain’s ad – not through a spokesman but on his own – he could make this ad and the right’s whole cultural populist meme backfire on McCain. But that’s a big if.
As one addendum: If you haven’t checked out Rachel’s new show, you should. It’s great – fast-paced, funny, informative – and anchored by a real movement progressive. It’s also doing really well in its first few days of ratings.
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This blog was first published on Huffington Post
Just off the coast of Liberia, an African country founded by freed American slaves, is the largest rubber tree plantation in the world, where, until last month, Bridgestone Corp, a Fortune 500 company that pocketed a profit of $1.16 billion last year, paid its 10,300 workers between $2.65 and $3.38 a day.
Not an hour. A day.
In a 1990 interview with a New York Times reporter, Terry J. Renninger, then president of the Firestone Synthetic Rubber and Latex Company, a Bridgestone/Firestone division that leased the 1 million square mile farm from Liberia, described it this way:
“The best way to think of it is an old Southern plantation.”
That’s right. A Southern slave-holding plantation, a place from which the original Liberians would have escaped. So thoughtful of Bridgestone/Firestone to replicate it for them in their country of liberation.
Mark of Modern Slavery
That’s not hyperbole. A non-profit group in Liberia called The Save My Future Foundation investigated conditions at the plantation in 2005 and wrote a report entitled, “Firestone: The Mark of Modern Slavery.”
This is what unrestrained, immoral and disloyal multinational corporations have reduced us to: modern slavery. They’ve forced pay down worldwide by transferring manufacturing from one low wage nation to the next lower wage nation.
We can shrug our shoulders and accept this wage race to the bottom, while corporations and corporate executives continue to grow wealthy from the profits squeezed from our paychecks, pensions and benefit packages.
Or we can do something about it.
To stop it, workers must embrace our similarities and stand together in solidarity. That is what the United Steelworkers, the AFL-CIO Solidarity Center and the workers at the Bridgestone/Firestone plantation did. Together we achieved election of independent union officers to represent the Liberian rubber workers, a just and dignified labor contract and hope for a future without bounds. It is an example of what can be accomplished to pull all workers up if we link arms.
Save My Future Foundation
The USW involvement began with a letter. While investigating the plantation, representatives of Save My Future urged dissidents there to write unionists in the United States for help. Eleven sent a letter to the AFL-CIO. President John Sweeney forwarded that letter to USW International President Leo W. Gerard because the steelworkers represent Firestone workers in the U.S.
Gerard assigned me to investigate the child labor and environmental law abuses alleged in the letter. I took with me Harmon Lisnow, who then was director of a labor management training program for the Steelworkers but who served in Liberia in the Peace Corps in the 1960s and still had contacts there, as well as a Firestone worker and representatives of the AFL-CIO Solidarity Center. It was almost exactly three years ago, July of 2005.
On the first day, we got an official tour of the plantation. We saw an 18-hole golf course, tennis courts, modern two-story brick homes complete with normal Western amenities like plumbing and electricity. In these, company managers live. We saw workers tap rubber trees, but we were prevented from speaking with them. This made us suspicious.
The next morning, before dawn, we slipped away from our hotel in Monrovia and evaded guards to tour the plantation without official company guides. Then we found the plantation the overlords had tried to prevent us from seeing, the one described in the letter and The Mark of Modern Slavery report.
Life in squalor
Workers live in squalor. They reside in the same lean-to huts the compnay constructed in 1926 when the plantation was founded by Harvey Firestone. They’ve got no electricity or plumbing. They share outhouses and a community pump.
In the dry season, if the pump does not draw water, they drink from the creeks and rivers, many of which Save My Future Foundation says Firestone has polluted. They are posted against fishing because of the toxicity.
Workers earned $3.38 a day if they tapped 750 trees, collected the latex in two 75 pound buckets, and carried it for miles on their shoulders to weigh stations. The weight, to ensure that their daily wages wouldn’t be halved, needed to total 150 pounds, a mind-bending, shoulder deforming amount.
Because this task is a physical impossibility for one person in a day’s time, most tappers enlist their spouses and children as helpers. Whole families work 12 hour days to fulfill Firestone’s demands for 75 pound buckets of latex. The spouses and children, of course, are not on the official payroll. That is how Firestone says with a straight face that it does not “employ” children and that the “hiring” of children violates company policy.
Like in the American south of the early 1900s, schools are separate and unequal. Those for the black workers lack teachers and books and supplies. Youngsters may not attend unless they have birth certificates, which the company-owned hospital failed to issue during the 14-year Liberian civil war. They may be purchased, but at half a month’s salary, precious few workers can afford them. This is another way children are forced into labor.
A company union
We also found a company union. This is a union that the company controls to its benefit. In this case, the UN found that Firestone, which hand-picked union officers had “compromised” their independence, so that that they were unable to advocate properly for the workers.
Within hours of our unapproved tour’s commencement, company security officers surrounded our jeeps and escorted us off the plantation. But we had what we came for, first hand stories and the photographs.
The next day, a company official showed up unannounced at our hotel and demanded I relinquish the film.
I refused. I told him told him the only way he would get the pictures was to go to the U. S. Embassy. We quickly made arrangements to leave the country. Though we feared we’d be searched and the photos confiscated at the airport, we managed to escape the country with our evidence of corporate depravity.
Six months later, in January of 2006, workers on the plantation engaged in something forbidden – a wildcat strike. They demanded better working conditions and elections for union officers who would represent their best interests.
When the USW heard about it, our Firestone workers took plant gate collections to help support their brothers and sisters in Liberia. The Liberian workers needed money to buy rice and other food rations while on strike, and our collections helped. The money also partially subsidized union training.
Government intervened
The government of Liberia intervened to help settle the strike. Firestone agreed to improve housing, medical facilities, and schools.
Once it was clear that a solid group of activists was ready to challenge the leadership of their union, the Firestone Agricultural Workers Union of Liberia (FAWUL), the USW and the AFL-CIO Solidarity Center sent trainers to Liberia. In the Fall of 2006, we trained the aggrieved workers committee on union structure and elections.
In the spring of 2007, the workers struck again demanding union leadership elections. During a demonstration, there was a melee in which a worker was killed and others were beaten and tear gassed. The assailants remain unknown and unprosecuted.
Ultimately, again, the government intervened and a date was set for union elections. On July 7, 2007 ballots were distributed across the plantation. Because so many workers are illiterate, having been denied educational opportunities, the ballots contained photographs of the candidates seeking to represent them. The USW and the Solidarity Center were there to ensure fairness. The group of officers put forward by the aggrieved workers committee won by a large margin.
Still, the struggle was not over. The General Agricultural and Allied Workers Union of Liberia challenged the election results in court, attempting to reinstate the Firestone-supported officers.
By December, when the workers still didn’t have a decision, they struck again. Another worker was killed. Many others were beaten and arrested.
Firestone ordered to recognize officers
Finally, on Dec. 21, 2007 the Liberian Supreme Court ordered Firestone to recognize the new union officers. This occurred because the country had a president, Ellen Johnson-Sirleaf, and new minister of labor, Samuel Kofi Woods, who would not stand for the corruption of the past. International organizations, including the United Nations, made it clear they were watching. And the AFL-CIO and the USW, including Leo W. Gerard himself, applied every bit of pressure they could.
Firestone workers in the US continued to donate money to support the Liberian workers, this time for training to negotiate with Bridgestone/Firestone.
Talks began early in 2008. Firestone officials told the workers to present them with a contract proposal and then were surprised by the sophistication of what they got.
By summer, when they’d reached a contract both sides generally agreed upon, Firestone objected to the union officers’ plan to present it to the workers to ratify – an accepted union practice. That had not been done by the company-union. The company had control then.
The newly elected union officers insisted. Workers would have the last say, not officers. Workers approved the contract earlier this month.
A 24 percent wage increase
It gives them a 24 percent wage increase retroactive to the expiration of their previous agreement in January of 2007; a 20 percent reduction in the daily tree quota for tapping, and mechanized transportation for conveying latex to weigh stations so tappers no longer must walk for miles carrying 150 pounds yoked to their backs.
This will change their lives. And the lives of their children, many of whom hopefully will no longer have to work alongside them on the plantation to meet the quotas. They will be able to go to school instead.
It is proof that they have a union now that requires management to treat them with dignity and respect.
In October, 2006, during the second trip that the USW made to the plantation, several of the Liberian union activists made it clear to us that is what they wanted.
Mike Zielinski, a member of our strategic campaigns, global bargaining and international affairs department, went on that trip to conduct training, right about the time the USW went on strike against Goodyear in the U.S.
He and several of the activists were distributing rice and other rations to families near a health clinic operated by the company when the head of security drove up and demanded to know what Zielinski was doing there.
Zielinski gave his name and identified himself as a member of the United Steelworkers.
A union whose name causes frenzy
The guard, a man from Mississippi, immediately began yelling, “Oh, Shit! The USW is here? Oh Shit! Oh Shit!”
After he drove off, one of the activists told Zielinski, that was the kind of union the Liberian workers wanted, the kind where all you had to do was say the name and it drove the company into frenzy.
These workers suffered though wildcat strikes, tear gassings, beatings, the deaths of fellow workers to achieve a strong union and a fair contract.
And they have, in turn, made a commitment to the USW. At our international convention in July, FAWUL leaders thanked USW members for our support and promised FAWUL members would reciprocate if ever needed.
Workers are brothers and sisters. We must pull each other up.
When presumptive Republican presidential nominee John McCain introduced Alaska Gov. Sarah Palin as his intended vice presidential running mate, those of us in the lower 48 learned that her husband, Todd Palin, not only was a champion snowmobiler and commercial fisherman but also a steelworker.
At the press conference, Palin trotted him out, stressing his steelworker credentials. Here’s a good union man, she emphasized.
But his United Steelworker card doesn’t include an automatic auxiliary membership for her. Or her running mate at the top of the Republican ticket, McCain, whose record on labor issues would require some serious penance before he could ever earn a union card.
John McCain opposes the Employee Free Choice Act, which would enable workers to collectively bargain and secure contracts with corporations more easily, like the employment contracts CEOs demand to have with corporations. McCain has jeopardized retirement by championing Bush’s privatization scheme for social security. McCain has voted for every American-job-killing free trade deal, without regard to human rights or environmental standards. And he has proposed, instead of providing health insurance for all Americans, a plan to tax the insurance of those lucky enough to still have employer-provided coveraage.
Soul mate
McCain has characterized Palin, 44, as his political soul mate. How he determined that is unclear since he met her only twice before selecting her, and her resume for VP is paltry, at best. She served two terms on Wasilla City Council and two terms as Wasilla Mayor. At that time, Wasilla had about 5,000 residents. She also served as chair of the Alaska Oil and Gas Conservation Commission, a job she quit in less than a year. She ran for lieutenant governor and lost. While seeking the governor’s post, she said she supported the bridge-to-nowhere, a $398 million span that would have linked Ketchikan, Alaska to an island of approximately 50 residents across the Tongass Narrows.
Then, after Congress squelched the bridge, she said, as she put it, “No thanks,” to the “earmark.” Despite all that, when Congress offered Alaska about half the money from that “earmark” that John McCain claims to have so opposed, Palin took it and spent it on other road projects.
While mayor, she lowered property taxes, before she raised sales taxes. She hired a Washington lobbyist to secure some of those McCain-dreaded “earmarks” for little Wasilla, a task it succeeded in doing. She left the town with millions in debt and a dispute that ultimately cost it $1.3 million to settle over ownership of land on which she wanted its $15 million sports complex built.
Plucking Palin
Even the New York Times in an editorial Wednesday questioned McCain’s judgment in plucking Palin from a state with a population (670,053) roughly the same as the twin cities’ where the Republicans are meeting: “If John McCain wants voters to conclude, as he argues, that he has more independence and experience and better judgment than Barack Obama, he made a bad start by choosing Gov Sarah Palin of Alaska.”
The workers of America cannot afford bad judgment after eight years of economy-crushing, debt-creating, Bush-Cheney. Unemployment, the national debt, inflation, home foreclosures and gas prices are all rising at demoralizing rates, while Bush and McCain continue to proclaim the economy is basically strong and any recession is all in workers’ heads, just some sort of psychological problem. Maybe that’s true — if you’re a multimillionaire like Bush and McCain. Or if you’ve got seven homes in which to hide from the reality of everyday American life like McCain.
Ms. Palin needs to stop trotting out her husband as an exhibit until she explains her positions on workers’ issues. Just exactly where does she stand on the Employee Free Choice Act?
Her family has benefitted from her husband’s ability to be part of a labor union. Workers in labor organizations earn higher wages and are more likely to have pensions and health insurance. Because he works for BP and is a member of the USW, which collectively bargained a good contract for workers at BP, Todd Palin earns a good wage and has good health insurance. The Employee Free Choice Act would make it easier for other Americans to join unions and earn better money and obtain health insurance. Polling shows that 70 percent of Americans support for the Employee Free Choice Act.
Inquiring minds want to know, Ms. Palin. Where do you stand on Employee Free Choice? Where do you stand on privatization of social security? Where do you stand on job-killing free trade?
Are you with McCain – and against workers – on these issues? If so, you need to stop using your husband’s membership in the USW as a prop, because then his union card cannot possibly cover up your or John McCain’s worker-savaging positions.
