A Stimulus Package for the Working Class

It’s no secret that President-elect Obama and his economic team are assembling the components of the much-needed economic stimulus package they will propose in late January.  It’s also no secret that the proposal will include hundreds of billions of dollars in road, bridge, sewer, and other public works projects that will create tens of thousands of good paying jobs for working-class families across the United States.

Those who understand Mr. Obama’s objectives are applauding the plan.  Mayors and governors like the fact that the package will accelerate the daunting and brutally expensive task of replacing and upgrading the nation’s crumbling infrastructure, including sewer systems that are more than 100 years old. And they like the fact that the workers rebuilding those aging sewers will be paying state and local taxes.

Advocates for the working class are encouraged because the plan will create jobs that can’t be shipped overseas.  Fact is, a sewer system can’t be built in the Maquiladora region of Mexico, hinterlands of China, or back alleys of Bombay, jammed  in a container, and shipped to Ohio.  In order to replace sewers in Youngstown or Cleveland, local workers have to dig holes, rip out old pipes, drop in new ones, and then bury them.  We’ll all get to see the work being done.  Many of us will live next door to the people doing it.

Not surprisingly, organized labor, particularly the building trades unions, are enthralled with Obama’s package because many of the jobs created will be subject to the provisions of the Davis Bacon Act (DBA), the nation’s prevailing wage law.  As a result workers will earn middle-class wages and receive health care and pension benefits, an army of idle apprentices will be able to find work, and thousands of men and women will have the opportunity to enter apprenticeship programs that will make them employable for the rest of their lives.

What may be surprising, however, is that the U.S. Chamber of Commerce, the Associated Builders and Contractors (ABC) the trade association for non-union contractors, and other anti-labor groups are also licking their chops over this component of the Obama plan.  Not because they suddenly love unions or the concept of prevailing wage, but because in their twisted little minds they believe the Congressional wrangling over hundreds of billions of dollars in infrastructure spending will give them yet another crack at repealing Davis Bacon.

For years the Chamber and ABC have been arguing that DBA creates waste, costs jobs, and hinders the free market.  In its position paper on the topic the U.S. Chamber claims that:

Repeal of the Davis-Bacon Act will spur local economic growth by making it easier for state and local governments to fund federally subsidized projects such as school construction and improvements to the transportation infrastructure.
Davis-Bacon repeal also would create an estimated 31,000 new construction jobs…

ABC echoes the Chamber’s rhetoric in its press releases and position papers:

[Davis Bacon's] time has run out. In the 21^st Century, especially in today’s competitive global economy, it is essential to allow the free market system to determine wages.

Today, this law represents nothing more than an American welfare program that subsidizes unionized companies.

Fortunately, responsible elected officials have turned a deaf ear to these specious arguments. Citing a long series of academic and government studies, including one issued earlier this year by the Economic Policy Institute that provides clear and convincing evidence of the benefits of DBA, they have derailed every attempt to repeal the statute whether in the form of legislation or President Bush’s callous Executive Order that exempted areas of the Southeast ravaged by Hurricane Katrina from the law.

Today, undeterred by past failures, the Chamber and ABC are undoubtedly girding themselves to resurrect their crusade against Davis Bacon.  They will contend that Americans will get far more bang for their stimulus bucks if new projects are exempt from prevailing wage.  They will argue rolling back the law together with increasing infrastructure spending by 10 or 15 times will add hundreds of thousands of Americans to the workforce-if only the corrupt unions and their greedy members get out of the way.

Some leaders in the trades don’t believe business and their Republican allies in Congress will launch an anti-Davis Bacon campaign in connection with the stimulus package.  After all, they wouldn’t want to be seen as blocking a measure that will pour billions into the economy at a critical time, would they?

Of course they would.  If they’re greedy enough to use a natural disaster like Hurricane Katrina as an excuse to attack workers, they certainly won’t hesitate to use something as mundane as an economic crisis to do the same thing.

In fact, it’s already happened.  Just review the deliberations surrounding the proposed bailout of the Big Three.  The focus of the discussion quickly turned from the failures of management to a vitriolic pillorying of “greedy” workers and their irresponsible union.  And it ended with demands that the UAW and its members take concessions or else.

Fortunately, the trades and their members are in a much stronger position.  They’re not begging for help. But they must be prepared to fight to preserve a law that has produced huge benefits for their members and for the taxpayers.  They should demonstrate that prevailing wage will ensure that the stimulus package puts money in the pockets of the working-class families who need it most and will spend it quickly on food, clothing, housing, cars, college, and yes, the state and local taxes that fund essential public services.

They must also make the case that repealing Davis Bacon will be good for only one group: the non-union contractors who will maximize profits by driving down wages in the trades, doing shoddy work, and refusing to fund job training and apprenticeship programs.

In short, it comes down to this: should the stimulus package be a long-term investment in America’s working class or a boon to corporations and their profits?  The answer is obvious-but only if someone is willing to stand up and make the argument.  Here’s hoping the trades and their allies are up for the job.

Leo Jennings

Beyond the Bailout: Why We Need a Regional Effort

Winter came early to the Mahoning Valley this year. Just last August the corporate, union, and political leadership of our community gathered in a makeshift auditorium on the floor of the Lordstown plant to hear GM’s CEO Rick Waggoner pledge  to replace the Cobalt with a new “world car,” the Cruze. This announcement came on the heals of GM’s announcement that it was adding a third shift and recruiting redundant workers from Shreveport, Louisiana and elsewhere. Many believed that, after years of hard choices the Mahoning Valley could finally compete in the global marketplace with a car people would buy because of its design, quality, and fuel efficiency.

But then the blizzards came. First was the banking meltdown. Investment banking houses folded over night.  Then came the credit crunch, as commercial banks began to severely constrain their lending practices.

The results of these two storms have been catastrophic for the automobile industry. Lack of consumer credit and unemployment-or the fear of unemployment-have caused car sales to plummet As a result, GM has cancelled Lordstown’s the third shift and furloughed workers-many of whom recently moved to the Valley to take up what appeared to be secure jobs.

And then a third storm-Federal indifference-hit the automobile industry and impacted the entire Great Lakes. The Big Three automakers flew to Washington to make their case for financial assistance. They came prepared-or so they thought-for a fair hearing. But, a hostile Congress rejected their plea. Instead they demanded that the Big Three pursue “planned bankruptcy, ” the UAW immediately agree to givebacks, and at least one CEO-preferably GM’s Wagonner-resign.

In the midst of all of this posturing, the impact of industrial bankruptcy on our region’s communities was once again conveniently ignored.  Although Bush stepped in on Friday with a bridge loan, the industry’s challenges – and the risk to the region should the auto industry ultimately collapse – remain.

This is not a new story. Since the collapse of Detroit’s Packard Motor Car Company in 1956 the nation has failed to anticipate and effectively address the impacts of deindustrialization on Great Lakes communities.

The incoming Obama administration, with a Great Lakes president who won with solid support from the region offers some hope that Washington will change this approach. Given entrenched opposition to our economic interests, however, we must develop effective strategies that will address the challenges facing our entire region. To do so we should take a page out of the Southern states’ playbook.

The Southern states, whose senators and representatives expressed some of the strongest enmity to the Big Three, has long taken responsibility for its economic future. In 1971, the governors of 13 southern and border states established the Southern Growth Policies Board to develop sophisticated data-driven regional economic development strategies to address the needs of the entire Southern regin.

The Great Lakes states, by contrast, have made only modest region-wide economic development efforts, choosing to focus principally on preserving the integrity of the Great Lakes watershed. As a consequence, region-wide economic challenges-be they shrinking cities or threatened core industries-are poorly understood and ineffectively promoted at the national level. Crisis management has become the norm as individual industries and communities have been left to fend for themselves.

The time for action at the regional scale is now. The debacle of the automobile bailout debate demonstrates that the leadership in other parts of our country-on the coast and in the Southern states-has little understanding of or concern for the interests of our region’s historically industrial communities. An eleventh-hour campaign to save companies on the verge of bankruptcy is not an effective way to advance region-wide interests. Concerted, data-driven public policies informed by the experiences of other, similarly challenged regions in this country and abroad, are the only way out of a structural economic crisis that threatens our people, our places, and our way of life.

As the South has risen, so must the industrial North: don’t complain, organize.

Hunter Morrison

The White Working-Class Vote in 2008

Progressive Democrats, nudged over the past eight years by progressive social scientists like Ruy Teixeira and Larry Bartels, are frustrated that white working-class voters don’t support Democratic presidential candidates.  Special attention was paid to this part of the white vote this year by politicians and political organizers as well as by the media.  The economy was the top issue, where Democrats are thought to have an advantage, and the sweeping unpopularity of George W. Bush made 2008 a Democratic year par excellence.  On the other hand, the Democrats nominated an African-American for President, and many college-educated Democrats fear white racism is worse among the working class than among the white middle class.

How did the white working-class vote this time around?  And what does it mean?

The exit polls at CNN Election Center provide lots of facts and figures that can inform discussion about these questions, but no definitive answers.  First, there are two competing definitions of the “working class” – one based on education and one based on household income.  By both definitions, the white working class again gave the Republican candidate, John McCain this time, a majority of their vote at the national level.  But state-level exit polls provide a more complicated picture of working-class whites who are diverse by region as well as in other ways.

Using the income definition, all white voters with annual household incomes of less than $50,000 are said to be “the white working class.”  This white working class was 25% of all voters in 2008, and only 47% of them voted for Barack Obama.  Looking at these same voters state-by-state, however, shows a wide variation – from 68% for Obama in Massachusetts to 11% for Obama in Alabama.  I didn’t look at all the states, but of those I did, Obama won the white working-class in 8 of the 12 battleground states outside the South.  In Ohio, for example, one of three voters were white working class (by this definition), and they voted 51% for Obama.  States where working-class whites gave Obama 60% or more of their votes include Illinois, New York, Washington, and Wisconsin.

The education definition defines all white voters who do not have at least a bachelor’s degree as “white working class.”  This is a larger group, 39% of all voters in 2008, and only 40% of them voted for Obama across the nation.  In five of the battleground states, however, this white working class voted for Obama over McCain – Iowa, Michigan, Minnesota, New Hampshire, and Wisconsin.  Obama also won majorities among working-class whites in Illinois, Massachusetts, and Washington. Conversely, Obama got only 9% of white working-class votes in Alabama and 11% in Mississippi.  In Ohio exactly one-half of the electorate was working class and white, and that half gave our president-elect only 44% of their votes.

What all this might mean requires much more discussion.  But even with this cursory look, two things should be clear:  First, there is not one white working class, but many, and it is well to remember that national numbers of any sort are aggregates of much more diverse and complex realities in many different places.  Second, race is still a predominant factor in dividing the American working class.  For the exit polls, the “nonwhite working class” consists of African-Americans, Latinos, Asians, and “Others” as self-defined by those polled.  There are, of course, substantial differences within these “nonwhite” groups, but they voted overwhelmingly for Barack Obama in 2008 – 83% using the education definition and 86% using the income definition.

Most whites who voted for John McCain are probably not racist, or even substantially motivated by racial prejudice.  But I think it is fair to say that the nonwhite working class is substantially better at perceiving and acting on their class interests than the white working class is in many parts of our very large, diverse, and complicated nation.

Jack Metzgar

A Recipe for Hunger

With less than a month left before Christmas, those who can afford it have already begun to plan their holiday meals. But for a growing number of Americans, Christmas will be a day when they go without food or lack access to healthy, nutritious food. From Connecticut to California, Mississippi to Maine, New Jersey to New Mexico, Oklahoma to Ohio, millions in America suffer daily from “food insecurity.”  The government defines food insecurity as inadequate or uncertain access to healthy, nutritious food, due to lack of money and other resources.

Thirteen million U.S. households, totaling more than 36 million people, experienced food insecurity in 2007, according to a U.S. Department of Agriculture report. Similarly, the 2007 Hormel Foods Hunger Survey: A National Perspective and an Ohio Perspective found that more than one in 10 Ohioans had gone to bed hungry in the past month because they could not afford enough food.

Against a backdrop of stagnant wages, high unemployment, tight credit, and rising food costs in 2008, even some middle-income families now struggle to put food on the table.  Still, research reveals that lower-income families, the working poor, the unemployed, and the homeless—those with a thin safety net or none at all —are hit hardest by food insecurity.

• While the wealthiest U.S. households spend about 7% of their income on food and middle-income households about 13%, the poorest U.S. households spend a whopping 32 % of their income on food. So the poorest households run out of money sooner than do wealthier households, and they have no reserve funds to purchase additional food when the cupboards are bare.

• Almost 40% of all food insecure families in 2007 had a household income below the official poverty line, and in nearly half of these families, one or more members were employed . This suggests that low wages contribute to food insecurity among the working poor. Indeed, a report by the Children’s Defense Fund indicates that, in 2005, the monthly income of families with two, full-time minimum-wage earners was $625 less than the monthly cost of basic living expenses for a family of four. These income shortfalls help explain why 44% of the working poor in Youngstown, Ohio were forced to choose between purchasing food and paying utilities last year. Congressional hearings on food insecurity indicate that the working poor throughout the country make similar tradeoffs.

• The absence of supermarkets that sell fresh fruits and vegetables and an abundance of stores and fast food restaurants that sell high calorie, low-nutrition food in low-income neighborhoods compound the problems of the poor. A 1995 study of supermarkets in Philadelphia, for instance, found that there were 63.5% fewer supermarkets in Philadelphia’s lowest income neighborhoods than its highest income neighborhoods. Many people in Philadelphia’s poorest neighborhoods have very limited access to healthy foods (see “Not So Super Markets” at http://www.philadelphiaweekly.com.) Similarly, a 2005 study of supermarkets in Los Angeles County found that middle and upper-income communities had 2.3 times as many supermarkets as did low-income communities (see “Healthy Food, Healthy Communities: Improving Access and Opportunities through Retailing.” at http”//www.united wayla.org/getinformed/rr/research/basic/Pages/Page3611.aspx.) And a 2007 study of fast food found that Los Angeles County had nearly five times more fast food restaurants or convenience stores than it had grocery stores or produce stores. The residents of Los Angeles County had higher obesity rates and higher death rates than people in California’s most affluent counties.

Add to these difficulties a cultural ideology that attributes poverty to personal deficiencies, like laziness, stupidity, and/or craziness, and you have a recipe for hunger. You also have indifference to poverty, resentment of the poor, and people unable to feed their families and blaming themselves for their struggles.

You also have people like those who attended this year’s public Thanksgiving dinner at First Presbyterian Church of Youngstown: the little girl with corn-rolled braids with ribbons who wanted to know if she could have another slice of pumpkin pie; the shy, pint-size girl with long dark hair who searched my face for approval before she would eat; and the many “grownups” who asked me, “Are seconds allowed? May we have seconds?”  Poverty and hunger have a human face.

During his campaign, President-elect Obama committed to ending childhood hunger in 6 years, cutting poverty in half within 10 years, and creating more jobs that offer a livable wage.  The pursuit of these goals must remain a national priority.  Charitable donations to food pantries and food assistance programs are needed and appreciated. But let us also work together to address the systemic factors that underlie food insecurity. Let us all work together to raise minimum wages, create more jobs in the United States, and educate and train people to fulfill those jobs. Let us all work to increase funding for federal nutrition programs and to build more supermarkets that sell fresh fruits and vegetables in low-income neighborhoods. Let us all work against a cultural ideology that blames and punishes the poor for being poor.  By doing this, we will increase access to healthy food for all Americans.

–Denise Narcisse

Bail Out the Working Class

I don’t mean to be snide-okay, I do mean to be snide-but does anyone else share my concern that the leaders of the Big Three Automakers have yet to figure out how best to travel to Washington D.C. in early December to fall on their knees and offer Congress a plan for the survival of the domestic auto industry in exchange for the $25 billion the companies need to keep the lights on.

While the three CEOs and their PR staffs have, apparently, grasped the incongruity and just plain stupidity of flying to Washington to beg for money in private jets that cost millions to buy and tens of thousands to operate, they haven’t yet embraced the idea of traveling to the nation’s capital via a convoy of their best vehicles, accompanied by the workers who built them, as suggested by an unnamed PR flack quoted on NPR last week.

That’s a no-brainer that any first year marketing or communications student would understand.  Here’s how it should work: the CEO’s, UAW officials, and UAW rank and filers and their families jump in a couple hundred of  Detroit’s most appealing SUVs, hybrids, sub-compacts, minivans, and crossovers,  and drive cross country to D.C.  Along the way they stop their mobile auto show in every possible media market, show off the vehicles at press conferences, grab a box of McNuggets and some fries at Micky Ds, and get back on the road.

The exercise would provide endless hours of press coverage, free advertising for their products, and may even convince a skeptical public that the Big Three might actually be able to do something constructive with the funds they’re requesting.

Better yet,  the CEOs should adopt the idea floated facetiously on last week’s Saturday Night Live: they should make the trip in a Ford Fiesta, just to show that they know what one looks like and that the car can make the trip.

Such a caravan would also do one more thing: it would put a very human face on the all-but forgotten element of the tottering industry: the working-class families who have dedicated their lives to producing American cars-and whose lives depend on the viability of the now not so big Three.

Unfortunately, until now workers have been discussed only in the abstract, only as a number: 3,000,000 jobs that would be lost if the industry goes toes up.  The time has come, indeed the time has passed, for the CEOs and the UAW to feature the real people whose real lives will be destroyed if Congress doesn’t act.

With all due respect to Ron Gettlefinger, as long as he is the person being interrogated by skeptics, , the conversation about the proposed bailout will continue to focus on minutiae like the job bank, vacation time, and the cost of health care benefits and pensions.  To effectively counter the attacks launched by critics such as Alabama Senator Richard Shelby, who clearly relishes serving in the role as Lord High Executioner of the Big Three and those commies at the UAW,  who vociferously contend that bankruptcy is the only option, Congress and the American public need to see and hear from the members of the working class who will lose their homes and their hard won share of the American Dream if the Big Three are not resurrected.

Moving away from the abstract will also focus attention on one other issue that is too often ignored during discussions of  the auto bailout, the financial sector bailout, or the possible provisions of  an Obama-conceived stimulus package: the need to revive hope and opportunity amid the working class by creating millions of good jobs to replace the ones the Big Three and other industries stupidly erased over the past three decades as they cavalierly went about firing millions of their best and most reliable customers.

For if there is anything more scary or confidence eroding than the automakers’ inability to understand how to get to Washington on December 8, it is their apparent bewilderment at how their industry and the American economy as a whole got to this point in the first place.

If they truly do not grasp the fact that purposely eroding the standard of living of millions of working-class families would eventually stagnate the nation’s economy, it won’t matter how the CEOs get to Washington because no amount of money, be it 25 cents, 25 billion, or 25 trillion, will save them.

On the other hand, if the Big Three, Congress, and the Obama administration recognize that the only way to stimulate the economy now and for decades to come is to reinvigorate the working class by investing hundreds of billions of dollars in domestic job creation programs, education, and health care, then the ride to D.C. in the Fiesta might just be worth the CEOs’ and all Americans’ time and effort.

Here’s hoping they enjoy the ride.

Leo Jennings

Jennings is a political consultant who has worked with the Center for Working-Class Studies on research about working-class voters