Obama Administration Defends Amazon’s Low Pay – Again

Oct 9, 2014Richard Kirsch

It's hard for workers to trust the President's support for policies that help them when the administration sides with Amazon at the Supreme Court.

Amazon’s business model is based on quick easy buying and low prices. One way it does that is to force its warehouse workers to wait a long time to leave work, without getting paid. And that’s just fine with the Obama administration, which continues to have a blind spot when it comes to decent pay and working conditions at Amazon.

It's hard for workers to trust the President's support for policies that help them when the administration sides with Amazon at the Supreme Court.

Amazon’s business model is based on quick easy buying and low prices. One way it does that is to force its warehouse workers to wait a long time to leave work, without getting paid. And that’s just fine with the Obama administration, which continues to have a blind spot when it comes to decent pay and working conditions at Amazon.

Yesterday the Supreme Court heard a case (Integrity Staffing Solutions v. Busk) in which workers are suing the temp firm that staff’s Amazon warehouses. The workers are in court because they don’t get paid for the time they are forced to stand on line for a security check when they leave work to be sure they haven’t stolen anything. The security screening itself reveals the poor working conditions and lack of respect that Amazon has for its workers. Workers who are well paid and have job security will not take the risk of stealing. The lack of pay adds costly insult to their injury.

The legal issues revolve around whether the security screenings, which can take 20 minutes or more, are “integral and indispensable” to the job, which would trigger pay under the Fair Labor Standards Act. Amazon certainly thinks so; the screenings aren’t optional. Still the firm, which pays warehouse workers around $11 or $12 an hour, cheaps out by denying the workers pay when they are waiting on line to leave.

As Jesse Busk, the lead plaintiff in the case, told The Huffington Post, "You're just standing there, and everyone wants to get home. It was not comfortable. There could be hundreds of people waiting at the end of the shift."

While President Obama has made numerous passionate speeches about giving Americans a raise, his administration is taking Amazon’s side at the Supreme Court, filing an amicus brief, alongside the U.S. Chamber of Commerce and other business lobbies.

Unfortunately, there’s nothing new about this from the administration. Last August, as I wrote at the time, “President Obama gave a great speech on why good jobs are the foundation for his middle-out economic strategy... from a huge Amazon warehouse where the workers do not have good jobs.”

The President told the Amazon warehouse workers who were in the audience, “we should be doing everything we can as a country to create more good jobs that pay good wages.”

Everything, it turns out, except being sure they get paid for all the time they are required to be at work.

The Obama administration may wonder why the President does not get more credit for the economic progress the nation has made coming out of the Great Recession or more recognition for his calls for raising the minimum wage. The core reason is that for too many Americans too low wages, too few hours at work, and job insecurity or no job at all remain their reality.

The President’s defense of Amazon reveals another reason. Americans see that he is unwilling to take on the powerful forces that are driving down the living standards and hopes of American workers. They see his embrace of Amazon and Wal-Mart, where he gave a speech on energy earlier this year. And too many come to the conclusion that it is only campaign contributors that matter, despairing of finding leaders who understand what really is going on in their lives – and who are willing to take their side against the powerful.

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

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Daily Digest - October 2: Democracy Has Become a Luxury Purchase

Oct 2, 2014Rachel Goldfarb

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This Edition: K. Sabeel Rahman, Four Freedoms Center (Eldridge & Co.)

Click here to subscribe to Roosevelt First, our weekday morning email featuring the Daily Digest.

This Edition: K. Sabeel Rahman, Four Freedoms Center (Eldridge & Co.)

Ronnie Eldridge speaks with Roosevelt Institute Fellow Sabeel Rahman about why democracy isn't working right now. He says public policy is mostly responding to the needs of the wealthy.

Not Enough Taxation and Too Much Representation (AJAM)

Amy B. Dean says the trend of companies moving abroad is just the latest strategy in tax avoidance. She argues that as companies further disconnect from American life, their influence on politics should be limited.

  • Roosevelt Take: On Next City, Roosevelt Institute | Campus Network National Director Joelle Gamble argued for a stakeholder model of corporate governance to force companies to pay more attention to local communities.

“Payment on an Unpaid Basis” (The Baffler)

Charles Davis looks at the entertainment industry's reliance on unpaid work. Many companies he called for comment responded by taking down unpaid listings, but that's not an efficient way to fight back.

Lies, Fear and Tragedy: Maria Fernandes and the Crisis of Part-Time Work (The Guardian)

The death of Maria Fernandes, a part-time employee at three different Dunkin' Donuts stores, highlights the crisis created by low-paying employers, writes Jana Kasperkevic.

Loan Fraud Inquiry Said to Focus on Used-Car Dealers (NYT)

Jessica Silver-Greenberg and Michael Corkery report on new investigations into fraudulent subprime auto loans. The loans are smaller, but could create the same problems as mortgages in 2008.

Make No Mistake: Eric Holder Chose Not to Jail the Bankers (Medium)

The Department of Justice had the power to send bank executives to jail, writes Alexis Goldstein, but chose a more passive approach instead of pushing through real change in the industry.

Voter Suppression: How Bad? (Pretty Bad) (TAP)

Wendy R. Weiser highlights the variety of new voting laws which will serve to suppress the vote in 2014, pointing at North Carolina, Texas, and Wisconsin as the most important states to watch.

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Daily Digest - September 16: It's Time to Rethink the Purpose of Corporations

Sep 16, 2014Rachel Goldfarb

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The Overpaid CEO (Democracy)

Roosevelt Institute Fellow Susan Holmberg and Mark Schmitt argue that exorbitant executive pay cannot be addressed without reconceptualizing a corporation as more than just an agent of its shareholders.

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The Overpaid CEO (Democracy)

Roosevelt Institute Fellow Susan Holmberg and Mark Schmitt argue that exorbitant executive pay cannot be addressed without reconceptualizing a corporation as more than just an agent of its shareholders.

Independence Has Costs and Benefits (The Scotsman)

Roosevelt Institute Chief Economist Joseph Stiglitz argues that Scotland should base its decision about independence on values rather than short-run economic gains or losses.

The Myth That Sold the Financial Bailout (AJAM)

Letting the investment banks collapse wouldn't have caused a second Great Depression, says Dean Baker. Between the FDIC and stimulus deals, the economy would still have recovered.

Why Pensions Went Away: A Theory (WSJ)

Lauren Weber looks at a new study on pensions, which suggests that the increase in influential investors who buy large blocks of stocks is tied to dropped pension plans.

Income Inequality is Hurting State Tax Revenue, Report Says (WaPo)

A new study from Standard & Poors shows the impact of inequality on state budgets, writes Josh Boak. S&P says that changing state tax codes won't be enough to solve this problem.

What the Poverty Rate Tells Us About the Overall Economy (NYT)

Jared Bernstein expects that the 2013 data will show that the poverty rate has continued to hold steady around 15 percent, because the recovery hasn't reached low-income households.

Scott Walker Wants To Fight Feds Over Welfare Drug Tests (HuffPo)

Federal law does not allow drug testing for food stamps or unemployment insurance, but Arthur Delaney reports that the Wisconsin governor wants to push back on that rule.

Unseen Toll: Wages of Millions Seized to Pay Past Debts (ProPublica)

Paul Kiel looks at the rise of wage garnishment for consumer debts, a system that has few protections for debtors and causes great financial hardship, since up to 25 percent of a paycheck can be taken.

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Daily Digest - September 4: On Corporate Boards, Local Stakeholders Protect Local Interests

Sep 4, 2014Rachel Goldfarb

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Fighting Corporate Inversion at the City Level (Next City)

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Fighting Corporate Inversion at the City Level (Next City)

Roosevelt Institute | Campus Network National Director Joelle Gamble argues for linking tax exemptions to local stakeholder governance on corporate boards to increase corporations' ties to their communities.

Guards Need Job Security of Their Own, Say Apple Store Protesters (In These Times)

Julia Carrie Wong reports on a union protest last week that aimed to garner public attention around Apple's use of subcontracted security guards who receive low wages and few, if any, benefits.

The Education Department’s Problematic Billion-Dollar Partnership With Debt Collection Agencies (Buzzfeed)

The structure of the Education Department's contracts with debt collectors encourages abuse by paying less for services like income-based repayment plans, writes Molly Hensley-Clancy.

The Huge, Regressive Tax Break Right Under Your Roof (TNR)

Danny Vinik looks at a new study on the costs of homeowner tax deductions, which he says subsidize bigger houses and more debt instead of encouraging lower- and middle-income home ownership.

Three Ways That Politicians are Storing Up Disaster for Pensioners (AJAM)

David Cay Johnston explains smoothing, spiking, and starving, three strategies that ensure pensions will be underfunded and create disaster for retirees and taxpayers alike.

The Class War in American Politics is Over. The Rich Won. (Vox)

Nick Carnes, using examples from his book White Collar Government, explains how the wealthiest Americans' control of the political system impacts policy outcomes.

Unemployment Trickles Down to Poorer Workers, Study Finds (WSJ)

When higher-skilled workers take low-skill jobs, the trickle-down effects exasperate inequality, reports Pedro da Costa, according to new research from economists in Barcelona.

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Daily Digest - August 29: A Rising Minimum Wage Lifts All Boats

Aug 29, 2014Rachel Goldfarb

There will not be a new Daily Digest on Monday, September 1, in observance of Labor Day. The Daily Digest will return on Tuesday, September 2.

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Who Stands to Benefit from San Diego’s Minimum Wage Hike (Voice of San Diego)

There will not be a new Daily Digest on Monday, September 1, in observance of Labor Day. The Daily Digest will return on Tuesday, September 2.

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Who Stands to Benefit from San Diego’s Minimum Wage Hike (Voice of San Diego)

Lisa Halverstadt speaks to Roosevelt Institute Fellow Annette Bernhardt about her research team's estimate that 172,000 workers could get a raise from San Diego's minimum wage hike.

The Biggest Tax Scam Ever (Rolling Stone)

Tim Dickinson looks at the range of multinational tax avoidance strategies in use today, from inversions to offshoring. It's all legal, he says, but the law itself is broken.

De Blasio Zeroes in on Expanding Living Wage (Capital New York)

New York City's mayor looks to require more businesses, including retail tenants of subsidized developments, to pay a living wage, report Dana Rubinstein and Sally Goldenberg.

Market Basket's Popular CEO Arthur T Goes Rogue and Wins – Now What? (The Guardian)

After months of employee protests on his behalf, Market Basket's former CEO has bought out his cousins to regain control. Jana Kasperkevic says he'll face new challenges from shareholders.

AFL-CIO’s Trumka: Democrats Need New Economic Team in 2016 (WSJ)

The labor union president wants 2016 candidates to avoid economics advisors who have participated in the revolving door of government and Wall Street, reports Eric Morath.

Americans Foresee Unending Economic Doom (Vox)

Danielle Kurtzleben looks at a new study from Rutgers which shows that a growing number of Americans believe the last recession permanently scarred the economy and that government can't help.

Pregnant Women Just Earned More Workplace Rights in Illinois (The Nation)

The new law establishes civil rights protections for pregnant workers, which will help them to stay in the workplace if they want to, writes Michelle Chen.

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Daily Digest - August 28: Read This Before Your Internet Goes Out

Aug 28, 2014Rachel Goldfarb

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Time Warner Cable Internet Outage Affects Millions (Vanity Fair)

Kia Makarechi speaks to Roosevelt Institute Fellow Susan Crawford, who says that lack of competition and oversight leads to problems like yesterday's Internet outage on the East Coast.

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Time Warner Cable Internet Outage Affects Millions (Vanity Fair)

Kia Makarechi speaks to Roosevelt Institute Fellow Susan Crawford, who says that lack of competition and oversight leads to problems like yesterday's Internet outage on the East Coast.

How Obamacare Can End Bloated CEO Pay (Fortune)

A little-known provision in the Affordable Care Act closes the executive performance pay loophole, but just for insurance companies, writes Sarah Anderson.

The Sorry State of Bank Apologies (ProPublica)

Non-specific corporate apologies are becoming de rigueur in settlements with banks, but Jesse Eisinger says these apologies aren't enough to resolve the banks' bad behavior.

The Expanding World of Poverty Capitalism (NYT)

Thomas Edsall defines poverty capitalism as the shifting of the costs of essential government onto the poor, as in offender-funded law enforcement systems in places like Ferguson, MO.

Court Finds FedEx Drivers are Employees, not Independent Contractors (Sacramento Business Journal)

A federal appeals court's ruling on this class-action suit may require FedEx to pay 2,300 drivers millions of dollars in back pay, uniform and truck costs, and more, writes Kathy Robertson.

40 Percent of Restaurant Workers Live in Near-Poverty (MoJo)

Tom Philpott looks at a new report from the Economic Policy Institute on poverty in the restaurant industry, which shows stagnant wages, few benefits, and limited opportunities for advancement.

Caught on Tape: What Mitch McConnell Complained About to a Roomful of Billionaires (The Nation)

In this exclusive, Lauren Windsor reports on a speech Senator McConnell made at a Koch brothers gathering, in which he stated his intent to defund, among other things, Dodd-Frank financial reform.

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Daily Digest - August 27: The Known Unknowns of Unemployment

Aug 27, 2014Rachel Goldfarb

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A New Reason to Question the Official Unemployment Rate (NYT)

Click here to subscribe to Roosevelt First, our weekday morning email featuring the Daily Digest.

A New Reason to Question the Official Unemployment Rate (NYT)

A new report says that unemployment data has become less accurate over the past 20 years, in part because of declining survey response rates, writes David Leonhardt.

Objecting to Austerity, French Style (New Yorker)

John Cassidy looks at the implosion of the French government this week, as three ministers, including the economy minister, have been pushed out for their objection to austerity policies.

Money for Nothing: Mincome Experiment Could Pay Dividends 40 Years On (AJAM)

Recently analyzed data from a 1970s Canadian experiment in guaranteed basic income shows far-reaching benefits in health and education, writes Benjamin Shingler.

Companies Say ‘No Way’ to ‘Say on Pay’ (WSJ)

Emily Chasan examines the companies that have repeatedly failed Say-on-Pay shareholder votes on their executives' pay packages, and what they have in common.

  • Roosevelt Take: Roosevelt Institute Fellow Susan Holmberg looks at how Say-on-Pay can curb sky-high executive compensation.

SEIU Wins Election To Represent Minnesota Home Care Workers (HuffPo)

Dave Jamieson says that yesterday's vote, which created Minnesota's largest public-sector bargaining unit in history, shows that unions are not letting Harris v. Quinn slow organizing.

Burger King’s Supremely American Habit (MSNBC)

Timothy Noah points out that Burger King, which might be planning an inversion to avoid U.S. corporate income taxes, already pushes as many costs as possible off its parent company.

Mayor Garcetti Pitching New Minimum Wage Plan to Business Groups (LA Times)

Catherine Saillant reports on business opposition to the Los Angeles mayor's plan, which would raise the city's minimum wage to $13.50 over three years and then tie it to local inflation.

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Daily Digest - August 11: Big Business's Frenemy in the White House

Aug 11, 2014Rachel Goldfarb

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Your Call: The U.S.-Africa Summit and Corporate Taxes (KALW)

Click here to subscribe to Roosevelt First, our weekday morning email featuring the Daily Digest.

Your Call: The U.S.-Africa Summit and Corporate Taxes (KALW)

Roosevelt Institute Fellow Mike Konczal discusses President Obama's interview with The Economist, and explains the administration's relationship with big business. His segment begins at 34:00.

Libertarian Fantasies (NYT)

Paul Krugman says that the libertarian vision of society bears little resemblance to reality, and references Mike Konczal's recent piece on libertarians and basic guaranteed income as an example.

Paul Ryan's Magical Poverty Tour (AJAM)

Susan Greenbaum points to an existing welfare block grant – the Temporary Assistance for Needy Families program – as proof that Ryan's plan would not serve enough of the eligible families.

Franchise Association Sues Over Seattle’s $15 Wage (MSNBC)

The law requires large businesses, including franchisees, to raise wages faster than smaller ones. Franchisees claims this discriminates against their business model, reports Ned Resnikoff.

Decline in 'Slack' Helps Fed Gauge Recovery (WSJ)

Pedro da Costa explains how the gap between economic resources we have and those that we use, particularly in the labor market, is influencing Federal Reserve decisions about interest rates.

Fed's Fischer Calls U.S. and Global Recoveries Disappointing (Reuters)

Howard Schneider reports on Federal Reserve Vice Chair Stanley Fischer's concerns regarding how central banks must respond to the possibility of permanently slowed growth post-recession.

‘Eat Your Vegetables’ Is Easier for Low-Income Mothers Who Get Help (Pacific Standard)

A new study shows financial incentives at farmers' markets do work to increase vegetable consumption, writes Avital Andrews, which makes a strong case for government nutrition incentives.

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Daily Digest - August 8: The Man with the Misguided Anti-Poverty Plan

Aug 8, 2014Rachel Goldfarb

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Paul Ryan’s Magical Thinking (The Baffler)

Paul Ryan's belief that poverty is rooted in personal failure isn't the only problem with his anti-poverty plan, writes Ned Resnikoff. It's also impractical to implement and too easily abused.

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Paul Ryan’s Magical Thinking (The Baffler)

Paul Ryan's belief that poverty is rooted in personal failure isn't the only problem with his anti-poverty plan, writes Ned Resnikoff. It's also impractical to implement and too easily abused.

An Interview With the President (The Economist)

While discussing corporate responsibility in this wide-ranging interview, President Obama points out that companies profess to care about social issues, but only lobby for their tax breaks.

Let's Do It! Let's Bring Back Earmarks! (HuffPo)

Ending earmarks has done nothing to reduce American cynicism about government's motives, and has contributed to congressional gridlock, writes Jason Linkins.

When U.S. Companies Skip the Country to Dodge Taxes, Their Shareholders Can Foot the Bill (Quartz)

Since shareholders are hit with a capital gains tax bill when companies use inversion (merging with a foreign company) to avoid taxes, Tim Fernholz says raising those rates could slow the problem.

These 7 Charts Show Why the Rent Is Too Damn High (MoJo)

Erika Eichelberger and AJ Vicens lay out the data explaining shifts in rental housing. They say that reducing government's role in housing finance could direct funds toward affordable rental housing.

New on Next New Deal

Without Public Investment, the U.S. Will Fall Into Chaos

In her video speculation for the Next American Economy project, Sarah Burd-Sharps, Co-Director of Measure for America, predicts that fiscal moderates will push public investment out of fear of a more costly future.

The Pragmatic Libertarian Case for a Basic Income Doesn't Add Up

Roosevelt Institute Fellow Mike Konczal says that Matt Zwolinski's case for a basic income guarantee makes faulty assumptions about what government is already providing through welfare.

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Sarah Burd-Sharps: Without Public Investment, the U.S. Will Fall Into Chaos

Aug 8, 2014

The Next American Economy project brought together 30 experts from various disciplines to envision tomorrow's economic and political challenges and develop today's solutions. Their assignment: be bold, and leave the conventional wisdom -- and their own opinions -- behind. In today's video, Measure of America's Sarah Burd-Sharps looks at the sweeping consequences of the government's failure to invest in the future.

The Next American Economy project brought together 30 experts from various disciplines to envision tomorrow's economic and political challenges and develop today's solutions. Their assignment: be bold, and leave the conventional wisdom -- and their own opinions -- behind. In today's video, Measure of America's Sarah Burd-Sharps looks at the sweeping consequences of the government's failure to invest in the future.

Sarah Burd-Sharps, Co-Director of Measure of America, speculates on the consequences of declining public investment in infrastructure, regulation, education, and more. With government abdicating its basic responsibilities, the U.S. will face increasing chaos -- collapsing bridges, food contamination outbreaks, falling elevators, and unemployed teenagers. Burd-Sharps imagines a moderate political wing moved to act by the rising economic costs of under-investment.

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