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On Dec. 18, a dozen retirees, men and women in their 60s, 70s, even 80s, began occupying a median strip along Route 33 in front of the closed Century Aluminum smelter in Ravenswood, W.Va. In tents and under tarps, a small group stays overnight, despite hypertension, arthritis and other old age ailments. One has suffered a stroke.

These vulnerable people expose themselves to weather extremes although some have no health insurance at all. Century cancelled it. That’s why they’re occupying Century.

The retirees labored their entire lives for wages and pensions comparably lower than those of other aluminum workers. They did it believing they made those sacrifices in exchange for good, lifelong health coverage. Over the past two years, however, Century evicted them, about 540 retirees altogether, from the insurance plan.

The betrayal burns. Executives at Century, corporate 1 percenters, committed the same sort of treachery that is being condemned by Occupy Wall Street demonstrators representing the victimized 99 percent across the country. Thus the retirees adopted the grandchildren’s protest tactic of encampment.

Century shuttered the 50-year-old Ravenswood smelter in February of 2009, throwing 651 workers out of jobs. Century, headquartered in Monterey, Calif., didn’t go bankrupt though. It still operates aluminum plants in Kentucky, South Carolina and Iceland. And it didn’t immediately cancel promised insurance for retirees.

Nine months after the shutdown, it announced it would terminate as of June 1, 2010 health benefits for retirees eligible for Medicare.  Then on Nov. 1, 2010, Century told its retirees who weren’t yet eligible for Medicare that it would stop paying for their coverage as of Jan. 1, 2011.

This revoking of earned benefits isn’t an isolated incident or a fluke. It is part of a pattern documented by Wall Street Journal investigative reporter Ellen E. Schultz in her new book “Retirement Heist.”  The subtitle is, “How companies plunder and profit from the nest eggs of American workers. (more…)

Labor Day is traditionally a time for picnics and parades. But this year is no picnic for American workers, and a protest march would be more appropriate than a parade.

Not only are 25 million unemployed or underemployed, but American companies continue to cut wages and benefits. The median wage is still dropping, adjusted for inflation. High unemployment has given employers extra bargaining leverage to wring out wage concessions.

All told, it’s been the worst decade for American workers in a century. According to Commerce Department data, private-sector wage gains over the last decade have even lagged behind wage gains during the decade of the Great Depression (4 percent over the last ten years, adjusted for inflation, versus 5 percent from 1929 to 1939).

Big American corporations are making more money, and creating more jobs, outside the United States than in it. If corporations are people, as the Supreme Court’s twisted logic now insists, most of the big ones headquartered here are rapidly losing their American identity. (more…)

The Bush administration told taxpayers to hand over hundreds of billions of their hard-earned dollars to bail out Wall Street banks because the financial institutions were too big to fail. Now, Rupert Murdoch, owner of politically powerful publications and broadcast stations, claims his News Corp. is too big to know.

Murdoch, who’s in the news industry, essentially a business based on knowing and knowing first, told an investigating committee of the British Parliament this week that he’s a know-nothing. The CEO of News Corp., owner of Fox News and the Wall Street Journal, said he was clueless about the phone hacking and other illegality endemic at his company. News Corp., he said, was just too big for him to keep track of its criminal activity. Others were to blame, he blathered. Others are responsible. But not him, not the guy in charge. Here’s what he said:

“I feel that people I trusted — I don’t know who, on what level — have let me down, and I think they have behaved disgracefully, and it’s for them to pay.”

Basically, he said, he deserves the profits that his underlings make for him by bribing police officers and hacking phone lines. But if his underlings do something wrong —like bribing police and hacking phones — he can’t be held accountable because News Corp. is too big for him to know. He claims he certainly would not be behaving disgracefully as CEO for failing to know.  And he’s saying he certainly shouldn’t have to pay for his underlings’ bad behavior on his watch. No, the way it works is he gets paid. No matter what.

Brilliant, as the Brits would say.

Banks are too big to be held accountable. Murdoch is too big to be held accountable. Only the little guy, like a laid off minimum wage earner, should be held accountable when he can’t make his mortgage or car payment. (more…)

By Sam Pizzigati
Editor, on line weekly Too Much

America‘s top bankers and CEOs don’t have any more talent than millions of other Americans. They do have, two timely new data dumps remind us, plenty of generous friends in pivotal places.

We Americans, former Reagan White House budget director David Stockman told a reporter last week, “no longer have a democracy.” Instead, Stockman charged, we have “crony capitalism,” a system that’s rigging the economy to benefit the powerful few — at everyone else’s expense.

Last week brought still more evidence on how revoltingly raw this rigging has become. Wall Street and Corporate America, new data detail, have some incredibly thoughtful cronies who sit in some incredibly important places.

Some of these cronies run the Federal Reserve. Others serve on corporate boards of directors. Together, they’ve made the Great Recession a Great Sensation — for America’s corporate and banking elite. (more…)

By Sam Pizzigati
Editor, on line weekly Too Much

Wall Streeters made fortunes, the new official report on America’s 2008 economic meltdown charges, defrauding the American public. They’re still making fortunes — and this new official report is already sinking out of sight.

A quarter-century ago, in 1986, the biggest Wall Street banker paycheck went to John Gutfreund, the Salomon Brothers CEO. Gutfreund pulled in $3.2 million. Two decades later, in 2006, Merrill Lynch CEO Stanley O’Neal pocketed $91 million.

To understand the 2008 Wall Street meltdown that cratered the U.S. economy, suggests the new final report from the panel Congress appointed to probe the causes of that crater, you need to understand this enormous pay explosion — and the fierce incentive this explosion created for reckless and fraudulent behavior.

How reckless and fraudulent? In the years that led up to the 2008 meltdown, the Financial Crisis Inquiry Commission report released late last month details, Wall Street’s top bankers and financiers “made, bought, and sold mortgage securities they never examined, did not care to examine, or knew to be defective.”

These same bankers borrowed, based on these securities, tens of billions of dollars “that had to be renewed each and every night” and then traded these billions in totally unregulated, semi-secret, financial “derivative” gambles.

This frenetic financial folly would eventually leave four million homes lost to foreclosure and another four and a half million American families either ensnared in the foreclosure process or seriously behind on their mortgage payments. (more…)

By Terrance Heath
Online Producer, Campaign for America’s Future

Whatever you may think of him, you’ve got to give Sen. Rand Paul (R-KY) credit. He said he would present his own budget, and now he’s done it. He’s even taken to the pages of The Wall Street Journal to defend it, and challenge Republicans and Democrats to: find other places in the budget where cuts can be made, to replace particular programs; consider whether it is worth “borrowing billions from foreign nations,” to fund programs “that could be administered better at the state and local level, or even taken over by the private sector.”

Paul’s challenge underscores the dishonesty of his budget, as well as those proposed by other conservatives. Paul and other conservatives wear their proposed budget as badges of honor, but they lack the courage to state clearly the human impact of their budget cuts, and the candor to confess the unreality of their proposals.

Dr. Paul budgets with a meat cleaver, hacking some government agencies out of existence. Others are all but eliminated, and simply sliced within an inch of their lives. A few more are left on life support (for now) and in the care of the agencies that still stand (for now.) (more…)

By Dylan Ratigan
Host of the MSNBC’s The Dylan Ratigan Show

A recent article in the Wall Street Journal showd that most of the people who lost jobs in this most recent recession found new ones at lower pay.  Over a third of these people had to take pay cuts of at least 20%.  Pay cuts.  We haven’t real sustained pay cuts across a large swath of Americans since the 1930s.

But this isn’t just a tragedy; it is in fact a conspiracy.  The people in charge aren’t just failing to prevent this from happening.  They want it to happen.  You see, pay cuts for workers mean that prices as a whole in the economy don’t rise. There’s less inflation, which means that banks and creditors make more money.

What do I mean by a conspiracy?  Well, you can read all about it.  It’s right in the transcripts of the Dec. 2005 Federal Open Market Committee, which is the committee of central bankers that run America (more on that below).  In that meeting, Dallas Fed President Richard Fisher is complaining about the enormous quantity of Chinese goods flowing into America.  He points out that this is creating ‘disinflation’, ie. lowering prices and wages for Americans.

Only, he isn’t complaining that there are too many Chinese imports, he is frustrated there aren’t enough imports.  Even though China has built special export-only ports to ship goods out of China, he says, the ports at “Long Beach and Northwest” can’t absorb what China wants to sell us, because of work rules (ie. unions).  This is a huge problem, Fisher continues, because it is blocking his CEO contacts from outsourcing as much work abroad as quickly as possible. They cannot “exploit China” fast enough. (more…)

By James Parks
AFL-CIO Senior Writer

Wages have fallen lower and stayed low longer in this recession than in any time since the Depression. With unemployment at 9 percent or better for 20 months and likely to stay that way for a while, wages will continue to drop.

Even the Wall Street Journal (WSJ) admits that wages for working people are heading down. In an article today, ”Downturn’s Ugly Trademark: Steep, Lasting Drop in Wages, ” the Journal reports that 54.9 percent of unemployed people who were lucky enough to find new jobs are making less than they did before and more than one-third (38.5 percent) took a 20 percent pay cut.

Dale Szabo, a Wisconsin man who lost his job as a manufacturing manager and holds two master’s degrees, sums up the bleak situation. Szabo, who now works as a janitor, tells the Journal:

It’s very hard work. I never dreamed I would be doing it. But I have to pay the bills.

What the Journal does not say is that corporations and Wall Street are getting filthy rich while the rest of us are struggling. It fails to mention the “wealth gap,” which measures the difference in total net worth between the richest and poorest. The latest report shows the nation’s top 1 percent now have 225 times greater net worth than the median American family.

Or that corporations are sitting on $1.93 trillion as of Sept. 30—up from $1.8 trillion at the end of June–and not using some of that money to create jobs.

***

Re-posted from the AFL-CIO Now Blog

Dave Johnson

By Dave Johnson
Fellow with Campaign for America’s Future

House Minority Leader John Boehner (R-OH) gave a speech this week describing his party’s positions on jobs and the economy going into the fall election. Summary: Our economic policies destroyed the country’s economy and millions of lives, but it made a few of my buddies really REALLY rich, so let’s do more of it.

I write about the specifics of Boehner’s call to return to disastrous trade policies below, but first I just have to say a few words about his economic ideas in general and how utterly wrong they are. In the speech Boehner said we have an “economy stalled by ‘stimulus’ spending.” But according to FOX News’ Wall Street Journal, yesterday the CBO reported that “the impact of the stimulus program estimated … the plan lowered the unemployment rate by between 0.7 percentage points and 1.8 percentage points.” In addition, the Washington Post reported, “The CBO said the act also increased the nation’s gross domestic product by between 1.7 percent and 4.5 percent in the second quarter, indicating that the stimulus may have been the primary source of growth in the U.S. economy.”

Boehner also said that “each dollar the government collects is taken directly out of the private sector.” This is the old “taxes take money out of the economy” argument, which is intended to trick people into thinking that the money just disappears instead of being used to pay for the schools, courts, agencies and infrastructure that enable businesses to thrive and drive the country’s prosperity. If you think that President Eisenhower’s spending on the Interstate Highway System “took money out of the economy” you really need to see someone about your problems and not take them out of the rest of us. (more…)

By Dean Baker
Co-Director, Center for Economic and Policy Research

Last week, the Fed announced that it would use the proceeds from retired mortgage-backed securities to buy up more government bonds. This may have a very modest effect in keeping long-term interest rates low, thereby giving a small boost to the economy.

Such a measure would be reasonable if the economy was basically fine and just in need of a modest lift. But this is not the case.

The unemployment rate is 9.5% and virtually certain to rise in the second half of the year. Job growth has basically stopped and GDP is likely to be in the range of 1-2% in the next four quarters, as state and local governments cut back spending, the stimulus phases down and the housing market resumes its slide.

In this scenario, the Fed should be taking aggressive steps to bring the economy back to full employment. After all, this is part of its job description. Its responsibility is to promote price stability and full employment. There is no concern about price stability in the sense of the rate of inflation being too high right now. Therefore, the Fed’s responsibility should be to do everything within its power to reach full employment; obviously, we are nowhere close now.

Its chairman, Ben Bernanke, even knows exactly what needs to be done, as the Wall Street Journal recently reminded us. He wrote a paper back in 1999 about Japan’s stagnant economy and mild deflation. Following a recommendation by Paul Krugman, he urged Japan’s central bank to target an inflation rate in the range of 3-4%. (more…)