Posts tagged with 'unemployment rate'
Weekly Diaspora: The High Cost of Cheap Labor
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by Catherine A. Traywick, Media Consortium blogger
A new study about the effects of immigration on U.S. employment supports the long-standing arguments of immigration advocates: Rather than displacing American workers, immigrant labor actually makes our economy stronger. Kevin Drum has the details at Mother Jones.
Now, with reports that undocumented laborers are a mainstay of disaster relief efforts all over the country, Americans are beginning to get a sense of the unsavory work relegated to many immigrants, and the high price immigrants pay for the simple privilege of employment.
Undocumented workers driving wages up
Going back to Mother Jones, new research examining the relationship between immigration and U.S. employment found that—contrary to conventional anti-immigrant wisdom—immigration does not negatively affect American employment. Instead, immigration drives wages up by pushing low-wage American workers into higher-paying jobs.
Here’s how it works: As less-educated immigrants gravitate towards work that requires fewer English language skills (like manual labor), their less-educated American counterparts move on to higher-paying, communications-intensive work that capitalizes on their comparatively better English language skills. This naturally drives wages up, and makes for a more productive economy overall.
The irony, as Drum notes, is that those who complain about immigrants stealing American jobs are the same people who want immigrants to learn English and assimilate as quickly as possible. “If they did,” Drum argues, “then they’d just start competing for the higher paying jobs that natives now monopolize.”
Stiffed in New Orleans
The reality of being an undocumented worker in the U.S. is starker than most Americans realize. Not only are immigrants doing work that most would rather not, they are also often cleaning up the messes that Americans leave behind.
Five years after Hurricane Katrina devastated New Orleans, undocumented laborers remain a key component of reconstruction efforts. Initially drawn to the city by the prospect of work and the Department of Homeland Security’s decision to suspend employment immigration enforcement, many undocumented laborers relocated to New Orleans to assist with rebuilding. But, as Elise Foley reports at the Washington Independent, their immigration status renders them especially vulnerable to rampant wage theft, threats of deportation and workplace violence.
The situation is so dire for many workers that numerous nonprofit groups have initiated projects in the city and are calling for legislation to combat the problem. However, a key concern is that rising anti-immigrant sentiment in other parts of the U.S. could exacerbate difficulties in New Orleans. If such sentiment results in even greater labor abuses or renewed immigration enforcement, whole communities of people who have been dedicated to rebuilding the city could find themselves without livelihood, or even be displaced.
Exploited undocumented workers clean up oil spills
Given the reality that undocumented workers are charged with some of the dirtiest and most unsafe work American employers have to offer, it shouldn’t be surprising that U.S. companies rely on immigrant labor to clean up their worst messes. Not only do undocumented workers have fewer employment options, their immigration status renders them far less likely to report unsafe working conditions, exposure to hazardous materials, and underpayment—making them especially attractive to employers looking to save money or hide bad behavior.
So, naturally, undocumented workers were called in to deal with the catastrophic BP oil disaster in the Gulf of Mexico (though their compliance only earned them the undue attention of Immigration and Customs Enforcement) and, more recently, an oil spill in Michigan.
As Todd A. Heywood at the Michigan Messenger reports, one company in particular has come under fire for hiring and then exploiting undocumented laborers. Hallmark Industrial, a Texas contractor hired to clean up the oil spill, allegedly paid its workers only $800 for up to 100 hours of work per week. Additionally, the company subjected them to unsafe and hazardous working conditions, and even failed to provide workers with on-site toilets—forcing workers to relieve themselves in the areas they were charged with cleaning.
Just 24 hours after the Michigan Messenger broke the story, Hallmark Industrial was fired from the oil spill clean up, its contract terminated by the company which hired it, Garner Environmental Services, Inc. Whether that’s a victory is questionable. Following the termination of the contract, 40 undocumented workers were arrested in Texas, on a bus chartered by Hallmark—presumably just returned from Michigan. While the termination of the contract ensures that its workers won’t be subjected to further workplace abuses, it also ensures that those same individuals must begin the difficult task of finding similar work elsewhere.
Unemployed in California labor camps
Clearly, despite an inexorable willingness to perform low-wage manual labor, undocumented workers are not impervious to the unemployment epidemic. In U.S. labor camps—where migrant agricultural workers can find seasonal or even long term lodging near ranches—farm work is increasingly harder to come by.
As David Bacon highlights at New America Media, both undocumented immigrants and legal “guest workers” are adversely affected by the recession. While the latter possess work visas and may therefore stay in the country legally, both groups live together in the same labor camps, where they remain, ironically, unemployed. Given the present economic climate, there isn’t enough work for even the lowest-wage workers. And in spite of their legal status, even guest workers are barred from applying for unemployment benefits.
The recession has cast both undocumented and legally sanctioned agricultural workers into circumstances even more dismal than those advertised by UFW when it launched its “Take Our Jobs” campaign earlier this summer. Outlining the long hours, low pay, and back-breaking labor associated with farm work, UFW satirically invited American citizens to replace the scores of overworked and undocumented laborers that keep our agricultural industry afloat.
Though meant to be a tongue-in-cheek response to the misconception that immigrants steal American jobs, the campaign exposes a real, if unfortunate, truth about undocumented workers: Even as their presence drives Americans into higher paying jobs, Americans employers are all too happy to subject the undocumented to the worst indignities.
This post features links to the best independent, progressive reporting about immigration by members of The Media Consortium. It is free to reprint. Visit the Diaspora for a complete list of articles on immigration issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, and health care issues, check out The Audit, The Mulch, and The Pulse . This is a project of The Media Consortium, a network of leading independent media outlets.
Weekly Audit: Congressional Inaction Feeding Unemployment Crisis
by Zach Carter, Media Consortium Blogger
After months of modest gains, the U.S. economy lost 125,000 jobs during June. That’s the worst jobs-related news this year. Without serious action soon, the struggling U.S. economy is going to get even uglier. Unfortunately, President Barack Obama’s economic team was slow to recognize the severity of the jobs crisis, and now seems unable to get Congress to actually do something about it.
As David Corn notes for Mother Jones, the recent jobs data is actually much worse than the 125,000 figure implies:
“The economy needs about 150,000 new jobs a month to keep up with population growth and new entries into the jobs market. It needs a lot more than that to make up for the 8 million or so jobs lost in 2008 and 2009.”
Weekly Audit: Financial Reform Makes Headway, Jobs And Social Security In Jeopardy
by Zach Carter, Media Consortium blogger
Two critical Wall Street reforms, once declared dead by U.S. megabanks, are suddenly close to Congressional approval. As the House and Senate iron out the differences between their financial overhauls, it now appears that lawmakers are finally willing to ban banks from gambling with taxpayer money by implementing a strong Volcker Rule, and to end taxpayer subsidies for risky derivatives operations.
These reforms will help stabilize the U.S. economy by clamping down on the naked speculation the drove financial markets off a cliff in 2008. But while lawmakers are finally waking up to the economic and political necessity of strong Wall Street reforms, conservatives have blocked key efforts to ease unemployment. President Barack Obama also appears ready to surrender to an assault on Social Security later this year. (more…)
Weekly Audit: Why Democrats Must Focus on Jobs Now
by Zach Carter, Media Consortium blogger
The job market in its worst state since the Great Depression and is putting tremendous strain on millions of Americans. Without action from Washington, D.C., the unemployment rate will remain elevated for years to come, and almost certainly above 9 percent through the end of 2010. Public esteem for economic policymakers isn’t doing so hot either. There are several simple steps that President Barack Obama and Congress could take to create jobs, but of late, neither have shown much interest in doing so.
Jobs matter
As Tim Fernholz emphasizes for The American Prospect, one of the best opportunities to repair the job market is a piece of legislation authored by Rep. George Miller (D-CA). The bill’s strategy is straightforward: Local governments pinched by the recession can apply for federal funds to ensure that teachers, cops, and other public servants are not laid off in the name of balanced budgets. Local governments that have already let employees go could apply for funding to re-hire them.
The result would be a clear win for the economy. Miller estimates that his bill could create 750,000 jobs, while the Economic Policy Institute expects the bill could create as many as 945,000. It’s also a smart political move—Obama’s political adversaries would no doubt find some way to criticize the move (they invented death panels for health care, after all), but as Fernholz notes, voters care much more about getting back to work than they do about ideological warfare or abstract bloviations about the federal budget deficit. (more…)
Weekly Audit: Will Obama Squander Wall Street Success By Gambling On Social Security?
by Zach Carter, TMC Blogger
After nearly a year of debating and haggling, Congress is finally about to take a modest, positive step forward with its bill to overhaul Wall Street. But by readying social security cuts and tax breaks for big corporations, the Obama administration is setting up an economic disaster that could have been crafted by President George W. Bush. It’s a political nightmare for the Democratic Party.
How did we get here?
While the road to our current economic mess has been three decades in the making, we know how we got here. Washington pushed policies that favored short-term Wall Street profits over the living standards of our citizens, eroding the middle class and destabilizing our entire financial system in the process.
As University of Texas economist James K. Galbraith explains for AlterNet, this strategy is enshrined in the ideology of mainstream U.S. economists, who simply refuse to acknowledge the existence of financial fraud. Economists’ blind faith in the power of markets is so strong that they cannot envision market systems in which the rules are systematically broken for profit on a massive scale. That is what happened in the savings and loan crisis, and it is what happened in the years leading up to the Great Financial Crash of 2008. (more…)
Weekly Audit: Wall Street Goes to the Movies
by Zach Carter, Media Consortium blogger
Last week, the U.S. Senate rejected a plan that would have broken up the nation’s six largest banks firms into firms that could fail without wreaking havoc on the economy. Even though the defeat reinforces Wall Street’s political dominance, there is still room for a handful of other useful reforms, like banning banks from gambling with taxpayer money and protecting consumers from banker abuses. After looting our houses, banks are now pushing for the ability to bet on movie box-office receipts, and will keep trying to financialize anything they can unless Congress acts.
Wall Street calls the shots
Writing for The Nation, John Nichols details last week’s Capitol Hill damage. Today’s financial oligarchy, in which a handful of bigwig bankers and their lobbyists are able to write regulations and evade rules they don’t like, will still be in place after the Wall Street reform bill is passed. The lesson is clear, as Nichols notes:
Whatever the final form of federal financial services reform legislation, one thing is now certain: The biggest of the big banks will still be calling the shots.
Still worth fighting for
As I emphasize for AlterNet, Congress has made a terrible mistake here, but there is still room for reform. It took President Franklin Delano Roosevelt seven years to enact his New Deal banking laws. It took even longer to reshape public opinion of monopolies when President Theodore Roosevelt took on Corporate America in the early 1900s.
What’s still worth fighting for? We have to curb the derivatives market—the multi-trillion-dollar casino that destroyed AIG. We have to impose a strong version of the Volcker Rule, which would ban banks from engaging in speculative trading for their own accounts. We have to change the way the Federal Reserve does business and force the government’s most secretive bailout engine to operate in the open. And we have to establish a strong, independent Consumer Financial Protection Agency to ensure that the horrific subprime mortgage abuses are not repeated.
As Nomi Prins details for The American Prospect, the current reform bill will not effectively deal with the dangers posed by hedge funds and private equity firms—companies that partnered with banks to blow up the economy through investments in subprime mortgages. That means that whatever happens with the current bill, Congress must again take action next year to rein in other financial sector excesses.
The derivatives casino at the movies
As Nick Baumann demonstrates for Mother Jones, banks are doing everything they can to gobble up other productive elements of the economy. The economy crashed in 2008 in large part because banks had used the derivatives market to place trillions of dollars in speculative bets on the housing market. This wasn’t lending, it was pure gambling: Instead of using poker chips, bankers placed their bets with derivatives. But, as Baumann emphasizes, banks are now looking to expand the sort of thing they can make derivatives gambles with. The latest proposal is to allow banks to bet on the box office success of movies. That’s right, banks would be gambling on movies.
Hollywood may be shallow, but it isn’t stupid. It doesn’t want to see the banking industry repeat its destructive looting of the housing industry on the movie business, and is pushing hard to ban banks from betting on movies. But we can’t count on every industry having a powerful lobby group to counter every assault from the banking system.
Taking stock in schools
Consider the unsettling report by Juan Gonzales of Democracy Now!. Gonzales details how big banks gamed the charter school system to score huge profits while simultaneously saddling taxpayers with massive debts that make teaching kids supremely difficult. By exploiting multiple federal tax credits, banks that invest in charter schools have been able to double their money in seven years—no small feat in the investing world—while schools have seen their rents skyrocket. One school in Albany, N.Y. saw its rent jump from $170,000 to $500,000 in a single year.
About that unemployment rate…
It’s not like public schools are flush with cash right now. The $330,000 increase in rent could pay the salaries of more than a few teachers. As the recession sparked by big bank excess grinds on, even the good news is pretty hard to swallow. As David Moberg emphasizes for Working In These Times, the economy added 290,000 jobs in April, but the unemployment rate actually climbed from 9.7 percent to 9.9 percent in March. That’s because the unemployment rate only counts workers who are actively seeking a job—if you want a job but haven’t found one for so long that you give up, you’re not technically “unemployed.” All of those “new” workers are driving the official figures up.
In other words, it’s still rough out there. And likely to stay rough as state governments try to deal with the lost tax revenue from plunging home values and mass layoffs. Nearly half of all unemployed people in the U.S. have been out of a job for six months or more. And while we’d be much worse off without Obama’s economic stimulus package, that percentage is likely to grow this year, Moberg notes.
This is what unrestrained banking behemoths do. They book big profits and bonuses for themselves, regardless of the consequences for the rest of the economy. Congress absolutely must impose serious financial reform this year. After the November election, breaking up the banks must once again be on the agenda when Congress considers the future fate of hedge funds, private equity firms, Fannie Mae and Freddie Mac. If we don’t rein in Wall Street, banks will continue to wreak havoc on our homes, our jobs and even our schools. Congress must act.
This post features links to the best independent, progressive reporting about the economy by members of The Media Consortium. It is free to reprint. Visit the Audit for a complete list of articles on economic issues, or follow us on Twitter. And for the best progressive reporting on critical economy, environment, health care and immigration issues, check out The Mulch, The Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets.
Weekly Audit: Congress Must Get Tough On Wall Street
by Zach Carter, Media Consortium blogger
Congress returns from its April recess this week with financial reform at the top of its to-do list. With millions of Americans still 
bearing the brunt of the worst recession in 80 years, Congress needs to start protecting our economy from Wall Street excess, and repair the shredded social safety net that has allowed the Great Recession to exact a devastating human cost.
Big banks are an economic parasite
In an excellent multi-part interview with Paul Jay of The Real News, former bank regulator William Black explains how the financial industry has transformed itself into an economic parasite. Black explains that banks are supposed to serve as a sort of economic catalyst—financing productive businesses and fueling economic growth. This was largely how banks operated for several decades after the Great Depression, because regulations had ensured that banks had incentives to do useful things, and barred them from taking crazy risks.
The deregulatory movement of the past thirty years destroyed those incentives, allowing banks to book big profits by essentially devouring other parts of the economy. Instead of fueling productive growth, banks were actively assaulting the broader economy for profit. None of that subprime lending served any economic purpose. Neither do the absurd credit card fees banks charge, or the deceptive overdraft fees they continue to implement.
Weekly Audit: Congress to take up financial reform, but will it be strong enough?
by Zach Carter, Media Consortium blogger
Next week, the debate over financial reform will begin in earnest when Congress returns from its Easter break. Both political parties are gearing up for a major fight, and the stakes couldn’t be higher. An out-of-control banking sector has cost the economy over 7 million jobs since 2007, and without major reforms, Wall Street could repeat this disaster in just a few years’ time. But thanks to Wall Street’s lobbying might, all of the necessary reforms are currently in jeopardy.
Key Reforms
Writing for The Nation, Christopher Hayes offers a useful primer on financial regulation, highlighting three reforms that are crucial to any bill.
- With no effective regulation of consumer protection issues for years, the existing banking regulators were more focused on preserving bank profitability than on going to bat for ordinary citizens. If banks could make big profits with unfair gimmicks (or even fraud), regulators usually looked the other way. The solution is a strong, independent Consumer Financial Protection Agency (CFPA) charged with nothing but protecting consumers from banker abuses, an agency with the broad authority to both write rules and enforce them.
- We need to rein in the $300 trillion market for derivatives, the complex financial contracts brought down AIG. Unlike ordinary stocks and bonds, derivatives are not traded on exchanges, so nobody really knows what is going on in this tremendous market. When something goes wrong, like with the collapse of Lehman Brothers, nobody can tell who the problem will effect. Without information, markets panic, and the entire financial system can collapse within a matter of days. Fortunately, this problem has a simple solution: require all derivatives to be traded on exchanges.
- Too-big-to-fail is too big to exist. The U.S. has never had banks as large as those that exist today, and their size gives them enormous political clout. It’s part of the reason why regulators didn’t make banks obey consumer protection laws, and why banks have been so effective in derailing reform. It’s been almost two years since the Big Crash, yet we are still wrangling over reform because giant banks deploy giant lobbying teams, and have almost unlimited resources to devote to their lobbying efforts. If we can’t scale back the banks’ power by breaking them up into smaller institutions, it’s unlikely that other reforms will be effective.
Weekly Audit: Fighting Economic Inequality in Haiti and at Home
By Zach Carter, Media Consortium Blogger
Rampant poverty can’t be written off as the result of historical accident or a worker’s incompetence. It is actively cultivated by bad public policies that direct economic resources into the hands of a wealthy few. The resulting inequality creates unnecessary suffering all over the world, from the humanitarian crisis in Haiti to the alarmingly high poverty rate in the United States. (more…)
Weekly Audit: Getting it Right in 2010
By Zach Carter, Media Consortium Blogger
The new decade offers a great opportunity to not only look back on the policies that led to our current economic malaise, but consider other ways of building stability that won’t wreak economic and ecological destruction.
Here’s a quick round up of some smart articles that address how economic policy changes could shift the way we work and live in the next decade. (more…)