Did you know that Washington, DC is the 9th most expensive American city to live in? Did you also know that thousands of private sector workers whose jobs are supported by taxpayer dollars don’t earn enough to live in the city where they work? Tomorrow, those workers are rallying for livable wages, in America’s 9th most expensive city. You can join them at noon, tomorrow, at Columbus Circle, in front of Union Station, in Washington, DC.

For anyone who lives and/or works here, it’s not exact news that the metro-Washington area is an expensive place to live. It’s no accident that some of the wealthiest zip codes in the country are right here. It takes quite money to just to maintain a modest in the metro-Washington area. Even just “getting by” doesn’t come cheap here. (Even living outside of the district and commuting in to work, I can attest, doesn’t make things less expensive. The farther out you live, the longer and more expensive your commute.)

According to folks at the Council for Community and Economic Research, the Washington area traditionally managed to just miss being in the top ten high-cost urban area. For the third year in a row, the Council’s cost-of-living index, places the Washington area in the top ten most expensive places to live.

The areas ranked as the most expensive places to live included most of the usual suspects, with New York’s Manhattan and Brooklyn boroughs taking the top two slots on the list. But for the third year in a row, Washington snagged a spot in the top 10, driven by the region’s high-priced housing market and relative immunity from the economic downturn.

“Since the beginning of the Great Recession, Washington has catapulted itself into the top 10 based on the housing market,” said Dean Frutiger, project manager for the Cost of Living Index at the council. Washington – which took ninth place in the first quarter- traditionally remained just shy of the top 10 high-cost urban areas, often swapping places with Boston, Frutiger said.

On average, the Washington area is 41.7 percent more expensive compared with the national average. Housing here is more than twice as expensive as in the rest of the country. Groceries are 12.8 percent more expensive, while health care is 1.6 percent more expensive.The region’s cost of living dropped slightly from the same time last year but is higher than 2011.

Washington’s high-priced housing market may have put the Washington in the top ten, but the index is compiled based on the cost of basic essentials – like housing, utilities, transportation, groceries, and health care – that many workers employed by private companies that contract with the federal government can’t afford on what they’re paid.

We find that nearly two million private sector employees working on behalf of America earn wages too low to support a family, making $12 or less per hour. This is more than the number of low-wage workers at Walmart and McDonalds combined.1 Yet, if anything, this figure underestimates the total number of poorly-paid workers funded by our tax dollars. Our analysis encompasses U.S. workers employed by government contractors, paid by federal health care spending, supported by Small Business Administration loans, working on federal construction grants, and maintaining buildings leased by the federal government. This encompasses the largest share of poorly-paid workers funded by our taxes. However, other streams of funding have yet to be analyzed. For example, loans and subsidies from the Department of Agriculture fund giant agribusinesses that employ more than a million farm workers, while grants from the Department of Education fund low-wage assistant teachers, bus monitors and cooks in Head Start and other programs. Due to lack of data, retail and food service workers for concessionaires of the National Parks Service and other federal agencies also fall outside our analysis.

These are employees working on behalf of America, doing jobs that we have decided are worthy of public funding-yet they’re being treated in a very un-American way. Our nation has a history of ensuring our tax dollars provide decent jobs. From the 1931 Davis-Bacon Act to Executive Order 11246 of 1965, and a host of other laws and executive actions, our laws have mandated that companies working on behalf of the American people are upholding high standards of employment practices. Yet as the nature and prevalence of federal contracting, lending and grant-making have changed, and some laws have been weakened, working people have fallen through the cracks.

When our tax dollars underwrite bad jobs, the economy as a whole is weakened and all of us are negatively affected. There is a ripple effect as low-paid workers and their families have little money to spend, hindering economic growth that could be creating more jobs. Poorly-paid workers also contribute less in taxes and are more likely to rely on public benefits to care for their families. In contrast, we would all benefit from an economy where workers earn good wages-and we have a special responsibility to see that the people working on behalf of our nation are paid and treated fairly. Raising standards for people working on behalf of America is one important piece to providing opportunities for workers to reach the middle class.

Behind those numbers are real people, hard-working people, who just want to earn a wage that helps them afford the essentials that don’t come cheap in the Washington area.

• Lucilia Ramirez, who has cleaned Union Station for 21 years spoke of making $8.75 an hour, with no benefits. Struggling to pay their mortgage on her small salary, Ramirez and her husband were forced to rent out bedrooms to strangers just to keep a roof over their heads.
• Katina Washington, who earns $9.65 an hour cleaning offices rented by the Department of Justice, lives with her cousin because she can’t afford her own apartment, and has to rely on food stamps to help with groceries.
• Nelly Garcia, 55, works at the Old Post Office Building, for a company that makes lots of money from federal contracts. But Garcia only earns $9.00 an hour, which isn’t enough to afford food or pay for the subway commute to work. A cancer survivor, Garcia has no health benefits, and must rely on Medicaid as a result.

According to the MIT Living Wage Calculator, a single adult needs to earn about $28,425 a year to afford the cost of basic necessities like housing, utilities, transportation, groceries, and health care. That requires an hourly wage of at least $13.67 an hour. For a single adult and a child, the annual costs are $54,805 – nearly double the cost-of-living for a single adult – and would require an hourly wage of at least $26.35.

Most private sector employees of federal contracts earn far less than a livable wage in an area as expensive as Washington. Yet everything one needs to live in Washington, from housing to groceries to transportation, is still more expensive than most other places, because Washington is area where lots of people can pay more.

Paying more for food, housing, etc., isn’t a hardship if your the CEO of a company with a federal contract. After all, federal benchmark compensation for CEO Reimbursement for work on a federal contract is over $760,000.00, but the lowest compensation reported by workers on federal contracts is $6.50 an hour. You can earn over $760,000 on a federal contract, while not paying your employees enough to live on. How’s that for inequality? And it’s all supported with your tax dollars and mine.

I don’t know about you, but I’d rather Nelly Garcia be able to buy groceries and have benefits than have my tax dollars help a federal contractor CEO redo his Rosslyn, VA penthouse again. If you feel the same way, then stand with these workers tomorrow, and join them in demanding a livable wage. Because nobody can live in Washington on minimum wage. Not in the 9th most expensive city in America.

… because if he were we could dismiss him as a typical stupid hippie to whom nobody should ever pay attention (particularly when sharp analysts like Newt Gingrich and George Will exist.) But now that people who the mainstream media can respect, like Tim Kaine, are saying it, now it’s respectable:

The two parties are miles apart on how to cut the deficit and national debt: Republicans want to slash spending even more. Democrats want to raise revenue.

And then there are the other Democrats — the ones who reject the entire premise of the current high-stakes fiscal fight. There’s no short-term deficit problem, they say, and there isn’t even an urgent debt crisis that requires immediate attention. This group could make it even harder for President Barack Obama to strike a grand bargain because they increasingly see no immediate need for either new spending cuts or significantly more revenue, both of which they say could further slow the economy.

These Democrats and their intellectual allies once occupied the political fringes, pushed aside by more moderate members who supported both immediate spending cuts and long-term entitlement reforms along with higher taxes.

But aided by a pile of recent data suggesting the deficit is already shrinking significantly and current spending cuts are slowing the economy, more Democrats such as Virginia Sen. Tim Kaine and Maryland Rep. Chris Van Hollen are coming around to the point of view that fiscal austerity, in all its forms, is more the problem than the solution.

This group got a huge boost this month with the very public demolition of a sacred text of the austerity movement, the 2010 paper by a pair of Harvard professors arguing that once debt exceeds 90 percent of a country’s gross domestic product, it crushes economic growth.

Turns out that’s not what the research really showed. The original findings were skewed by a spreadsheet error, among other mistakes, and it’s helping shift the manner in which even middle-of-the-road Democrats talk about debt and deficits.

“Trying to just land on the debt too quickly would really harm the economy; I’m convinced of that,” Kaine, hardly a wild-eyed liberal, said in an interview. “Jobs and growth should be No. 1. Economic growth is the best anti-deficit strategy.”

No kidding.

Look, I’m happy that some of the Democrats are finally beginning to see the obvious. It’s been a long haul. Unfortunately, we’ve already slashed the hell out of government for the past four years because nobody wanted to be seen as a hippie. But better late than never. What this does is give the Democrats in congress the ability to beat back the Grand Bargain and, if we’re lucky, maybe be just a little bit bolder on the sequester. Or bold enough to at least, cut some deals with Republicans instead of just agreeing to reinstate the funding for items that Republicans value. (You know — we’ll reinstate the FAA if you agree to reinstate cancer treatments or something like that …)

Anyway, this return to the “reality based community” is long overdue. And very welcome.

Update: Oh hey, it seems to be “hippies were right” day at Politico (Not that anyone will admit it, mind you.)

Democrats have used a clear and potent attack against Republicans in recent elections: Don’t vote for them because they’ll cut your Social Security and Medicare.

But using that playbook next year, as Democrats had planned, just got a lot more complicated.

President Barack Obama blurred the lines this month when he embraced entitlement cuts of his own as part of his budget plan. And Democrats now fear their leader’s tack to the center could blunt one of their sharpest weapons in the battle for the House of Representatives next year.

The concern is that Republicans will have a ready retort — your own president proposed entitlement cuts — and force Democrats on the defensive. The issue is critical to senior voters, who turn out in disproportionately large numbers in midterm elections.

“I think it does make it more difficult for Democrats in the next election,” said Democratic Rep. Rick Nolan, who occupies a swing district in Minnesota. “I would think that Republicans will say this cycle that if you want your Medicare and Social Security cut, that’s what Obama wants to do. … And I imagine that’s what Republicans will campaign on.”

The president’s shift came after an election year in which Democrats made the GOP’s embrace of Wisconsin Rep. Paul Ryan’s controversial plan to overhaul Medicare a centerpiece of their campaigns. The offensive, Democrats say, helped them net eight House seats — a respectable figure but short of the 25 they needed to seize the lower chamber.
[...]
The White House did not respond to a request for comment.

Bill Burton, a strategist for the Democratic public affairs firm Global Strategy Group and a former deputy White House press secretary for Obama, said in an email “there is no doubt that Karl Rove and his allies will spend millions of dollars lying about what the President’s budget means in terms of the economic health of our country. What we don’t know is just how much Democratic donors are going to stand up to those lies.”

While Obama would love for his party to win the House — he has said he would do everything in his power to help Democrats take the speaker’s gavel from John Boehner — his budget highlighted tensions with congressional Democrats. The president has said he wants to reach a grand bargain with Republicans to tame the nation’s $16 trillion debt. And getting there, Obama signaled with his budget, requires taking a whack at entitlements.

“The White House is more concerned about his legacy,” said Paul Maslin, a longtime Democratic pollster. “It’s the classic dilemma of the second-term incumbent.”
[...]
In the days since Obama released his budget, many of the Democrats who have been quickest to distance themselves from his blueprint are those from senior-heavy districts. California Rep. Raul Ruiz, a freshman Democrat who represents a Palm Springs-area district where seniors compose about half of all registered voters, said “putting the burden of the national deficit on the backs of our seniors is wrong.”

Democrats are even concerned that Republicans could reverse the dynamic and portray Democrats as the bad guys on entitlements.

In an interview with CNN after Obama unveiled his budget earlier this month, National Republican Congressional Committee Chairman Greg Walden of Oregon called the plan “a shocking attack on seniors.”

“I’ll tell you when you’re going after seniors the way he’s already done on Obamacare, taken $700 billion out of Medicare to put into Obamacare and now coming back at seniors again, I think you’re crossing that line very quickly here in terms of denying access to seniors for health care in districts like mine certainly and around the country,” he said.

Walden’s remarks drew criticism from some in the GOP, which has come out in favor of chained CPI as a way of reducing the deficit. But the NRCC chairman’s point was made: Republicans had been given a free opportunity to hit back on entitlements, long a Democratic trump card.

Brock McCleary, a GOP pollster and former NRCC deputy political director, said Republicans couldn’t expect to gain an advantage on who’s most likely to defend programs but could try to fight the issue to a draw.

“The president has very clearly shown the way for how Republicans can keep voters in the lurch about which party is going to protect entitlements,” he said.

Indeed. But Democrats in congress have not taken any votes on this and if they’re lucky they won’t have to. I’m fairly sure that won’t stop the wingnut millionaires for tarring them with this absurd proposal anyway, but at least they won’t have to defend it.

If House members want to be very sure to end up on the right side of this one in 2014, they should all sign the Grayson-Takano letter. (And so should you …)

What does it mean to be an American? What does it mean to be an American corporation? An article in the Wall Street Journal the other day should trigger questions like these.

WSJ: Domestic-Based Multinationals Hiring Overseas,

Multinational companies based in the U.S. boosted their global work forces in 2011 almost entirely by hiring workers overseas, underscoring the slow growth in the U.S. job market.

… The paltry hiring at home reflects where multinational companies are focusing their attention. Stronger economic growth in overseas markets in Asia and Latin America is driving their expansion, reinforcing their shift toward cheaper labor or closer access to customers.

The U.S. parents of multinational firms account for about one-fifth of total private U.S. employment. Since 1999, employment by U.S. multinationals is down by 1.1 million inside the U.S., while it is up by 3.8 million overseas.

The hiring by American companies is not happening in the U.S. At the same time these companies are holding $1.7 trillion of profits outside of the country, away from their own shareholders and our economy to avoid their taxes, while pushing to dramatically lower the taxes they pay us – and even to get out of paying any taxes at all on money they make outside of the country!

Why Do We Have Corporations?

Why do We the People even have laws that allow corporations and give them special benefits? The answer obviously is for our common benefit — why else would we do it? The corporate form of a business enables the company to easily obtain capital from investors, in order to accomplish large-scale projects that benefit us. To encourage this we give these entities special privileges. For example, we limit liability which means the investors are not held liable for the actions of the company – they won’t lose more than their investment if the company gets sued for some reason. We provide a system that helps them obtain financing, insurance, market liquidity and all kinds of things to help those investors get a good return on their money.

Benefit: We the People want railroads, but it takes a lot of money to build and operate a railroad. And our system wants private companies to do the work of building and operating railroads instead us just doing it ourselves. So we set up a way for a private company to gather investment from lots of people.

Why Do We Want “American” Corporations?

Why don’t we just contract with any old corporation that comes along to get things done for us? Who cares what country these entities are from? Why should we as a country want to encourage and support our American corporations? Because American corporations make money for us. That is the whole point.

Other countries see themselves as countries, and compete with us as a country, for their benefit and the benefit of their people. As much as some of us might want a world in which we all cooperate and share and have “free trade” and other ideals and dreams, the fact is that other countries understand themselves as countries. Companies and industries located in other countries are operated to benefit their people. Their governments give them special benefits to help them compete with our companies. And then they are taxed so their country can have good schools and infrastructure and all the rest of the benefits of the modern world, for them.

And if we do not respond in kind, then their people end up better off at the expense of our people.

As long as other countries operate for the benefit of their people, it is our job to keep up our end of the bargain as it exists and operate as a country for the benefit of our people. This means that we support our companies, and expect them to bring the money they make back here, and share the returns with us.

We The People Used To Understand Who Is The Boss

We the People (used to) understand that these companies exist for our common benefit and (used to) expect certain things back from these corporations. We (used to) expect them to provide high-quality products and services and not engage in fraud and trickery. We (used to) expect them to provide a safe and fair work environment with good wages and benefits. We (used to) expect them to be good citizens that benefit the communities where they operate. And our laws and enforcement (used to) make sure they operated that way – for our common benefit.

These understandings and expectations have disappeared. An Apple executive articulated the new corporate understanding to The New York Times. He said giant multinationals like Apple “don’t have an obligation to solve America’s problems.” And to prove it, American corporations are holding $1.7 trillion in profits outside the country – just sitting there – rather than bringing that money home, paying the taxes due and then paying it out to shareholders or using it to “create jobs” with new factories, research facilities and equipment.

We The People Have Forgotten

Citizens, elected officials and corporate management have forgotten why we have corporations and who they are supposed to serve. We have instead developed a system in which corporations exist for their own sake, doing anything they want to do, and doing these things only to enrich the few who own and manage them.

There is no longer an understanding and expectation that these entities – creations entirely of We, the People — are supposed to exist for the common good of We, the People. They no longer try to provide high-quality goods and services. They no longer feel they must avoid fraud and trickery – and without enforcement of rules are able to gain advantage over others that do not operate this way. They no longer provide a safe and fair work environment with good wages and benefits. They are not good citizens that benefit the communities and country where they operate.

They are no longer under the control of We the People.

Are American Multinationals Really American?

For all intents and purposes giant “American” multinational corporations have transformed into entities with completely different interests from their American workers, customers, communities, citizens and government. These corporations are no longer operating in the interest of America or any country, while claiming the benefits of being American corporations (when it suits them.)

For example, the giant American multinational corporations are now set up and structured to avoid paying taxes here, or to any country. They set countries against each other in their hunt for low-wage labor, subsidies and advantages in markets.

Some companies are even “American” when it suits them, and not “American” when it does not. The post, Unraveling The Romney/Bain Tax Story drew on a New York Times report, Offshore Tactics Helped Increase Romneys’ Wealth. From the post:

Why is part of the same company set up based in Delaware, and part in the Cayman Islands or Luxemburg or Bermuda? Because the functions of the American-based company are those functions that avoid taxes on foreign entities, and the functions of the Caymans-based part are the functions that would have to pay US taxes if it was in the US. But in reality it is the same company — except for tax purposes! Here is the explanation of the foreign-based parts, from the Times article:

Had those funds been set up in the United States, the Romneys and other American investors would probably have been subject to certain federal taxes for their ownership of “controlled foreign corporations.” Setting up the funds in the Caymans allowed them to avoid those taxes.

Here is an explanation of the American-based parts,

Another appeal of offshore funds is that they help private equity attract investment from deep-pocketed big institutions like pension funds and university endowments. While these are generally tax-exempt, they are liable for taxes on “unrelated business taxable income” if they put money in funds that use debt financing to make investments.

So why aren’t they all just foreign-based? Why do they need to have an American-based part? One reason is that making the loans that run up the debt that enables these companies to get the interest deductions (more tax avoidance) would incur income taxes if the loans came from a foreign entity,

Beyond their tax advantages, however, offshore funds controlled by American money managers can also create new tax problems. Those funds are limited in their ability to make loans without triggering corporate income taxes — an issue for Sankaty funds. Therefore, they usually have a parallel domestic fund that makes the loans, holds them for a period before selling a portion to the offshore fund, a practice known as “season and sell.”

And, of course, the American-based entities enable the low “carried interest” tax rate that hedge fund managers enjoy. The company paying Romney can’t be foreign-based,

So-called carried interest, the cut of a fund’s investment gains earned by its managers, enjoys a favorable tax treatment. But under I.R.S. rules, carried interest cannot be derived from a corporation, like the offshore blockers used by Sankaty.

The American-based entities can buy American companies without incurring “foreign-based” obligations. Then the foreign-based entities can avoid the taxes that the American-based buyers of companies would have to pay. And the foreign-based investors can be in the foreign-based parts of the company, avoiding US tax obligations. Also American entities like pension funds can avoid US taxes they would otherwise have to pay.

To put it another way, the same company can pretend it is US-based when that is what it needs to be, and foreign-based when that is what it needs to be.

What Can We Do?

First of all, we want and need corporations, for the reasons outlines above. For our common benefit, to accomplish large-scale projects, and as a result to bring shared prosperity to our citizens.

But we have to be the boss of them. We have to understand again that We the People set up this system of corporations for our common benefit. (Why else would we set up these things?) And we have to again call ourselves a country.

Can we align the interests of these giant corporations with our national, American interest? If we cannot, they should be stripped of their American corporate privileges and be required to do the same things as other entities that are not wedded to the national interest. And then We the People can build and support American companies that are.

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Where does the Republican Party put its energy? On anything that furthers the interests of the wealthiest. Tax cuts and kicking government are right at the top of that list*. Also near the top comes blocking minimum wage increases, blocking workplace safety rules and keeping lots of people unemployed so they are desperate to take any nasty, dirty, low-paying job, etc. But next to tax cuts and keeping government from operating Republicans fight to keep unions from being able to organize because the power of working people acting together collectively begins to challenge the power of concentrated wealth that corporations represent. To this end Republicans hate and fight the Labor Department and now the new nominee for Secretary of Labor.

In The News

Republican “oppo” researchers issued a 63-page report on Thomas Perez, who President Obama has nominated to fill the vacancy for Secretary of Labor. Perez currently serves as head of the Justice Department’s Civil Rights Division. The report accuses Perez of being corrupt because he fought to keep civil rights law intact by trading a case involving St. Paul landlords who were renting substandard homes in low-income areas for a case accusing St. Paul of not doing enough to help minorities win contracts.

The story is circulating today, WaPo version, GOP issues critical report of labor secretary nominee Perez,

The GOP lawmakers accuse Perez of misusing his power last year to persuade the city of St. Paul, Minn., to withdraw a housing discrimination case before it could be heard by the Supreme Court. In exchange, the Justice Department agreed not to intervene in two whistleblower cases against St. Paul that could have won up to $200 million for taxpayers.

… Top Democrats on the House Oversight Committee issued a report on the investigation Sunday, writing that Perez “acted professionally to advance the interests of civil rights and effectively combat the scourge of housing discrimination.” The Justice Department also defended Perez, saying litigation decisions made by the department “were in the best interests of the United States and were consistent with the department’s legal, ethical and professional responsibility obligations.”

The GOP report cites documents that suggest Perez’s decision frustrated and confused career lawyers at Justice who initially wanted to join the whistleblower cases against St. Paul. These lawyers described the department’s change of heart as “weirdness,” “ridiculous” and a case of “cover your head pingpong.”

Complicated… Perez’s deal kept the Justice Dept. out of one court case in exchange for keeping another from making it to the Supreme Court which would use it to overturn important civil rights laws 5-4.

What Republicans Say Perez Did That Was Bad

The main charge against Perez (other than being brown) is that as part of his duties in the Civil Rights Division he brokered a deal in a housing discrimination case in St. Paul, to keep the case from reaching the Supreme Court. The St. Paul case would have enabled the Supreme Court to strike down “disparate-impact theory” in civil rights a labor law, with a 5-4 vote.

The current Roberts movement-conservative majority on the Supreme Court looks for cases that enable them to maneuver 5-4 votes to strike down laws that protect citizens from billionaires and corporations (who fund the conservative movement) in various ways. Citizens United is the best example of this, it undid campaign finance laws, enabling billionaires and giant corporations to put multiple millions into getting their candidates elected at every level. The case involving Perez is one that this court could have used to further harm citizen interests with a 5-4 vote.

The Case

In the early 2000s a group of landlords were renting substandard (heat didn’t work, no locks, rotten floors, rat holes, bugs, broken pipes, etc.) housing to minorities in St. Paul. St Paul cracked down with code enforcement. The landlords sued St. Paul, claiming code enforcement would violate the Fair Housing Act because minority tenants would have less access to … nasty, substandard housing with rotted floors, rats etc.

That’s right, the slumlords sued the city arguing that if the city did code enforcement and it put them out of business minorities wouldn’t have access to nasty, substandard housing that was infested with code violations. They claimed that code enforcement violated civil right laws by potentially decreasing minority access to nasty, substandard housing.

This is exactly the kind of case Republicans love because it turns the tables against minorities, and makes the claim that the kind of businesses that scam on and prey on and take advantage of vulnerable and powerless citizens are really “performing a service.”

St. Paul’s lawyers had a duty to the city to do what they could to win for the city. They knew the Supreme Court had an interest in overturning the civil rights law that the slumlords were using to sue them, meaning they would win the case for the city. So St. Paul was taking the case to the Supreme Court even though the Court would use it to strike down civil rights laws nationally.

Perez struck a deal to avoid this outcome. This is what Republicans are accusing him of.

The Other Case

The other side of the deal Perez brokered involved a suit against St. Paul claiming the city had not been using federal funds to sufficiently help minorities get contracts and jobs with the city. The case would have collapsed if the Justice Dept. didn’t get involved, and could potentially cost the citty millions if they did. So in exchange for St. Paul not taking the other case to the Supreme Court Perez got the Justice Department to agree not to get involved.

What This Tells Us

All of this tells us that Perez understands the strategic long game that the billionaires and their giant corporations are playing, by investing in getting their people placed on the courts and Supreme Court, and how they manipulate cases to use to undermine long-standing laws that help regular people. What Perez did shows that he is there to fight for regular people, not to make a fortune by “playing along” while in a government position and then later receiving a high-paying payoff job with the corporations behind this.

Good Sources

A good source for understanding the complicated story is Adam Serwer in Mother Jones, The GOP Wants to Use This Bizarre Case to Scuttle Obama’s Most Progressive Cabinet Nominee,

The deal Perez helped cut likely prevented a landmark civil rights law from being struck down by the Roberts court. Perez’s civil rights division later used this law to secure record financial settlements against banks that discriminated against minority borrowers during the financial crisis. And Republicans were very angry about it.

Another source for a more conservative take on this is a series of posts by Sean Higgens in the Washington Examiner (note – you will be swarmed by pop-up ads):
A glimpse into how Thomas Perez operates.

More on the deal Thomas Perez cut with St. Paul.

How Thomas Perez might use ‘disparate impact’ theory as labor secretary.

*More from the list of where the Repubican Party puts its energy: keeping people from voting, keeping objective information from reaching people, keeping entrenched “incumbent” interests like oil and coal and big pharmaceutical companies from facing serious competition, etc., etc.
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It’s hard to imagine a more relevant moment for the National Urban League to release its State of Black America 2013 report. This year, after all, marks the 50th anniversary of the 1963 March on Washington and the 150th anniversary of the Emancipation Proclamation — two historical events of enormous importance to African Americans. It seems even more appropriate that the Urban League’s report is released on the same day that President Obama — our first African-American president, recently re-elected to a second term  — presents his annual budget to Congress.

Could there be a more appropriate moment to assess how far we’ve come, how far we’ve yet to go, and what kind of leadership is needed to move us forward?

The subtitle of the report, “50 Years of {Uneven} Progress,” acknowledges the undeniable progress since the 1963 March, and the remaining disparities that have worsened as a result of the financial crash, and the ensuing economic crisis and jobs deficit.

The impact of civil rights measures passed during the Civil Rights Movement, and the affirmative action programs policies that followed, is seen in the gains African Americans have made in education.

• More African Americans complete high school. Only 15 percent of African-American adults today lack a high school education, compared with 75 percent of adults 50 years ago. This represents a 57 percent closure of the high school completion gap in 50 years.
• More African-Americans attend college. There are now 3.5 times more African-Americans aged 18-24 enrolled in college than were 50 years ago.
• More African-Americans hold college degrees. For every college graduate in 1963 there are now five.

Gains in education are tied to an increase in standards of living

• Fewer African-Americans live in poverty. Since 1963, the number of African-Americans living in poverty has declined 23 percent.
• Fewer African-American children live in poverty. The percentage of African-American children living in poverty has dropped 22 points in 50 years.
• More African Americans are homeowners. Since 1963 the percentage of African-Americans who own their homes has increased 14 points.

Those numbers tell the story of how far we’ve come. Yet they don’t quite tell the story of where we are. First, they must be understood in the context of more data.

• The unemployment gap persists. The unemployment gap has only closed 6 percent since 1963, and the unemployment rate for African-Americans remains twice that of whites — regardless of education, gender, region of the country, or income level.
• The income gap persists. In 50 years, the income gap between African-Americans and whites has closed just 7 percent.
• The wealth gap is growing. Net wealth for African-American families dropped 27.1 percent during the recession.
• Disproportionate poverty persists. African-Americans make up 13.8 percent of the population, but account for 27 of Americans living in poverty.

As Isaiah J. Poole pointed out in his post, “The Sinking American Electorate: African Americans Still In Depression,” the story these numbers tell is an old familiar one for African-Americans: the more things change, the more they stay the same. If the rest of the country caught a cold during the recession, African-American communities caught pneumonia, and are far from recovering.

The persistence of disproportionate African-American unemployment is a capstone of the “heads-they-win-tails-we-lose” persistence of African Americans getting the worst when the economy declines and the least when the economy grows.

That pattern was repeated during the Great Recession. An essay on the black middle class in the National Urban League’s “State of Black America 2012″ report contains some of the stark details, concluding that “almost all of the economic gains of the last 30 years have been lost” since late 2007, and worse, “the ladders of opportunity for reaching the black middle class are disappearing.”

In 2010, the median household income for African Americans was 30 percent less than the median income of white households 30 years ago. African-American household income fell more than 2.5 times farther than white household income during the Great Recession, 7.7 percent versus 2.9 percent. Home ownership rates also fell for African Americans at roughly double the rates of whites, essentially wiping out the gains in home ownership since 2000. Today, more than a quarter of African Americans live below the poverty line, compared to about 10 percent of white people.

A newly released report by the Joint Center for Political and Economic Studies also underscores the severity of economic conditions among African Americans. That report focused on black unemployment rates in 25 states with large African-American populations starting when the economy was at its peak in 2006. “In 2006, prior to the recession, the unemployment rate in the black community was already at recession levels in every one of the 25 states we studied, from 8.3% in Virginia to 19.2% in Michigan, and in 20 of the 25 states the unemployment rate for African Americans was above 10%,” the report said. “In 2011, more than two years after the economic recovery began, unemployment rates for African Americans across most age, gender and education categories remained significantly higher than their pre-recession rates.”

In fact, the jobless rate for African Americans between the ages of 20 and 24 in these states was 29.5 percent in 2011, two years after the recession had supposedly ended.

“If the national unemployment rate was anywhere near these percentages, we’d be in crisis emergency mode,” said Ralph B. Everett, president of the Joint Center, during a discussion of the report last week.

Instead, the “crisis” that has the attention of the Washington political class is the federal debt, and even the Obama administration has now caught some of the fever. This fixation dictates that the federal government not be able to devote the resources necessary to address this crisis. While members of the “Fix the Debt” crowd – overwhelmingly white and disengaged from the day-to-day struggles of African-American communities – pleads concern about the debt that will be handed down to their children, no one speaks of the consequences that the continuing economic depression experienced by millions of African-American households will have on the next generation.

Coming at the same time President Obama’s budget, the State of Black America 2013 report raises the question of whether President Obama has done enough to address the economic realities African Americans are facing. It’s a fair question, given that the overwhelming majority of African-American voters backed Obama and the Democrats in 2012. For its part, the administration touts its economic efforts on behalf of African-Americans, which Rev. Al Sharpton summed up in what should be forever known as the “ham sandwich” approach to Black economic concerns.

At that White House meeting, which lasted more than two hours on Feb. 21, the Rev. Al Sharpton, president of the National Action Network, drew laughter from Obama and his fellow activists when he found a folksy way to defend the president from charges he didn’t talk enough in his first term about black issues:

“I had a friend when we were in school who told me he was going on a kosher diet. He converted his religion. We went to eat, and he ordered a ham sandwich. I said, ‘You can’t eat that.’ He said, ‘Why?’ I said, ‘That is pork.’ He said, ‘No, no, no. Pork is pork chops or pork loin. I said, ‘No, you don’t have to call it pork for it to be pork. It is still pork.’ ” The lesson, Sharpton said, is simple: “Some things he’s done, it may not have been called ‘black.’ But it affected us. It was still pork.”

With due respect to both the president and Rev. Sharpton, Black American stands at an economic crossroads. Depending on the course taken from here, the gains of the past 50 years — even those of the past 150 years — will either be the foundation that future gains are built upon, or they will be weathered away by winds of economic disasters. African American Economist Bernard Anderson points out that President Obama would do well to remember the words of another Democratic president.

Anderson still recalls from memory Johnson’s stirring speech at Howard. “You do not take a person who, for years, has been hobbled by chains and liberate him, bring him up the starting line of a race, and then say, ‘You are free to compete with all the others,’ and still justly believe that you have been completely fair,” LBJ said. Anderson pointedly asks, “Can you imagine President Obama referring to 200 years of slavery? I cannot imagine him saying anything like that…. He has an obligation to address this [economic disparity] that is grinding black people down.” While encouraged by parts of Obama’s State of the Union address, Anderson asks, “Why has he not revisited the issue since he made that speech during the campaign?”

It’s necessary to go even further back in history to understand the nature of the economic state of Black America; not just 50 years, but perhaps even back 150 years to the Emancipation proclamation.

In his book, Ending Slavery: How Well Free Today’s Slaves, scholar expert Kevin Bales describes the steps he believes are necessary for communities and countries all over the world to end the modern-day slave trade – from sex-trafficking to forced labor in jungles of Brazil to bonded labor passed down through generations in India. Key among those steps is the rehabilitation of freed slaves. Emancipation, Bales says, is insufficient without investment in rehabilitating freed slaves, who require medical care, education, and reorientation of their skills, which he describes in New Slavery: A Reference Handbook, as “restor[ing] the personhood of the person.”

The essential condition of bondage is in the minds of the people. …They have been conditioned to accept that their place is at the periphery of society. The process of release and rehabilitation is to restore the personhood of the person, to restore self-esteem, confidence, and the feeling that they too can win.

He goes on in Ending Slavery to describe how that process stopped short in America, after the Civil War.

After the American Civil War freed slaves also knew what it would take to build a decent life in free dome. Their work experience told them that forty acres and a mule could feed a family and grow enough of a cash crop to make a life and get the children to school. American slaves never got their forty acres and a mule.

Without collective investment in rehabilitation and restoration, Bales writes that many freed slaves return to slavery, either by choice or compelled by circumstances unchanged except for simply having been released.

It would take another post or two to thoroughly address, but from 1863 to 1963 to 2013, American as stopped sort of addressing the economic needs and realities unique to African Americans. That’s probably because those needs stem from a history that seems to have gotten more difficult to talk about, instead of easier. It’s one of the ironies of having a Black president. And it may be what’s keeping Obama from speaking out about the economic crisis in Black America, and proposing policy solutions that speak directly to that crisis.

President Obama’s misguided, deal-seeking budget is, as described by the White House, “not ideal.” Lacking the bold jobs plan he introduced in 2011, it doesn’t amount to a “ham sandwich” for African-American families and communities still waiting for recovery.

Republicans criticize government spending when it is about making our lives better. Of course, by definition all government spending is done to make our lives better. (In a democracy government spending is We, the People deciding how and where to spend the money. Would we decide to spend money to make our lives worse?) In a plutocracy, though, it’s a very different story.

If you live in Wisconsin, for example, your tax dollars are used to help drive down your wages – and everybody else’s.

The Washington Post has the story: Wis. taxpayers spend close to $850,000 for lawyers to defend restrictions on public unions,

Wisconsin taxpayers have spent close to $850,000 defending lawsuits over Republican Gov. Scott Walker’s 2011 law that all but ended collective bargaining for most public workers.

And the lawsuits aren’t over yet.

Ending collective bargaining means ending the right of employees to band together so they have collective power. Instead of individuals coming to the boss and saying, “Please throw me a crumb if you feel like it,” with a union it’s all of the workers, together, saying “Let’s talk about how we can work together to grow this business for all of us.”

Who Benefits From Low Wages And Restrictions On Unions?

Ending collective bargaining and other restrictions on unions are about one thing and one thing only: driving down the wages and benefits that working people receive. And when you do that, see if you can guess what happens. From the post 40% Of Americans Now Make Less Than 1968 Minimum Wage,

The chart shows that wages used to go up as productivity went up, but in the 1970s they decoupled. Productivity kept going up but wages stagnated.

That is what happened when trade agreements broke the ability of unions to ask for a fair share of the proceeds. Businesses started moving jobs out of the country to low-wage, “business-friendly” non-democracies, and said to people who wanted raises “shut up or we’ll move your job out of the country, too.” This “decoupled” productivity increases from potential wage increases.

So the benefits of our economy started going to just a few people, instead of being spread around. The post, Is This Where The (Middle-Class) Money Went? tells that story:

Now, here’s another chart. This chart shows that financial-sector and non-financial-sector compensation used to rise together, but in the late 70′s / early 80′s they decoupled. Financial-sector compensation took off, while non-financial-sector compensation did not.

Race To Bottom

The problem isn’t just Wisconsin by any means. In Michigan Races To Bottom With Anti-Union Law I explained, (“lectured,” my wife says. “Shut up,” I mansplained.)

Pay attention to what is happening in Michigan, because it will add even more downward pressure to your wages and benefits, wherever you live and work. Republicans in the Michigan legislature have rammed through anti-union “right-to-work” laws making union dues voluntary even as unions a required by law to provide services to members and non-members. They say this will make Michigan more “business-friendly” by driving down wages and benefits, thereby stealing jobs from states where working people have rights. The actual intent is to get rid of the unions altogether, and their ability to fight for the 99% in the ongoing class war with the 1%.

From this week’s post, Obama Shouldn’t Buy The Lower-Corporate-Taxes Line,

Downward Spiral

Imagine states A and B. State B cuts their tax rates and passes laws that restrict unions, keep minimum wages low and other wage-lowering measures to “attract businesses” and their jobs from state A. As successful as state B might be at getting companies to move there, what is the effect on the larger economy of all of the states? Obviously the overall wages in the larger economy will fall as the same jobs move to a state with lower pay. And even the jobs that remain in state A are under pressure to reduce their wages, with the employers threatening to move their companies to state B as well.

And the government of state A has less revenue to fund their schools and courts and infrastructure, while the government of state B sacrificed revenue to make their state more attractive. So the overall level of investment in public goods also drops.

By reducing standards State B is undercutting the ability of the people in state A to control the companies in state A. State B has enabled companies to extort lower wages and other advantages elsewhere. State B is undercutting State A’s ability to be an effective democracy.

This is what is happening around the world as these giant companies put the squeeze on governments, with the threat to just go somewhere else. This is what happens when corporate power is allowed to reach such a level that it challenges the power of governments to control them. Originally the corporations We the People enabled in order to accomplish things that are good for US have changed into a force with enough wealth and power that instead of providing good jobs and goods and services, they instead demand we pay them tribute.

So as the country converts from democracy (representative government for you nitpickers) to plutocracy, we should expect more of this. Or, alternatively, we can get corporate money back out of our politics, out of the think tanks, etc., and back into the corporations where it is only used to run the business. And then we can try to remember what a democracy is supposed to be like — where we do things to make our lives better.
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It would seem so:

Speaking to Megyn Kelly about the Supreme Court’s hearing on Proposition 8, O’Reilly–who has previously compared gay marriage to bestiality–appeared to have “evolved” on the subject. He said he didn’t “feel that strongly” about gay marriage “one way or another” and thought the decision should be left to individual states. “I want all Americans to be happy,” he said, adding, “I live in New York. New York is fine with it.”

President Obama:

I have to tell you that over the course of– several years, as I talk to friends and family and neighbors. When I think about– members of my own staff who are incredibly committed, in monogamous relationships, same-sex relationships, who are raising kids together. When I think about– those soldiers or airmen or marines or– sailors who are out there fighting on my behalf– and yet, feel constrained, even now that Don’t Ask, Don’t Tell is gone, because– they’re not able to– commit themselves in a marriage.

At a certain point, I’ve just concluded that– for me personally, it is important for me to go ahead and affirm that– I think same-sex couples should be able to get married. Now– I have to tell you that part of my hesitation on this has also been I didn’t want to nationalize the issue. There’s a tendency when I weigh in to think suddenly it becomes political and it becomes polarized.

And what you’re seeing is, I think, states working through this issue– in fits and starts, all across the country. Different communities are arriving at different conclusions, at different times. And I think that’s a healthy process and a healthy debate. And I continue to believe that this is an issue that is gonna be worked out at the local level, because historically, this has not been a federal issue, what’s recognized as a marriage.

Bipartisan comity at last?

I still agree with Richard Kim that evoking states’ rights is a rhetorical cop-out (at best) and think the President could have just come out for marriage equality as a civil right and been done with it. Maybe the right wing Supreme Court will take the lead on that, although I’ll be surprised if they do. But O’Reilly taking the same position as the President certainly leaves room for the president to evolve further without risking well … anything. He should do it.

As the US kicked off the Iraq War on the evening of March 19, 2003, with the infamous “shock and awe” bombardment of Baghdad, I huddled into a small high school classroom for an antiwar gathering organized by several faculty members. Little did I know at the time that, ten years later, the Iraq War would prove a defining moment in the development of my worldview.

Iraq War, 10 Years Later

Click here to view the video on YouTube.

I spoke about my experience on Take Action News with David Shuster last Saturday. Subscribe to YouTube.com/takeactionnewstv for free clips in your inbox.

I was a sophomore at The Ramaz School in Manhattan. Lo and behold, enough students were either against the war or sufficiently curious that the classroom where the teach-in had been scheduled was way too small for the turnout. It was packed to the point where people could barely get in the door. Kids were sitting on desks, standing, sliding in wherever they could. A large white sheet with a crudely painted black peace sign was draped over the blackboard. Faculty members made varying arguments against the war and answered students’ questions.

My history teacher, Dr. Jon Jucovy, made the strongest case against Iraq that I’d heard so far. He identified each of the claims being made about Iraq’s weapons of mass destruction–nuclear weapons; chemical and biological weapons; and ties to Al Qaeda–and shot them down. One claim that stood out because of how quickly it had been debunked, but continued to be used by the Bush Administration, was that Iraq had purchased large amounts of “yellow cake” Uranium from Niger with which to make nuclear weapons. It had been clear since March 2002 that those purchases hadn’t taken place, Jucovy explained. In fact, the State Department and the International Atomic Energy Agency had flagged the document that was purported to record the sale as a forgery in early January 2003.

It didn’t take long to find out that Jucovy–like so many other skeptics–was right. There were no weapons of mass destruction.

Given the tragic consequences of the Iraq War, ten years later, however, there is no satisfaction in the knowledge that we were right before some other people. As Jucovy told us on the eve of the war, “I hope I’m wrong. I really hope they find weapons of mass destruction there.”

My personal experience and that of many of my peers, though, may offer lessons for avoiding other destructive policies that enjoy similarly unquestioned reverence among the political and media elite.

The Iraq War marked the end of our political innocence. It was our generation’s Watergate scandal. It instilled in us distrust in all institutions, but especially the government and the media. It taught us to question conventional wisdom even when it means enduring ridicule; to appreciate the overriding tendency of powerful people to abuse their power; and to accept that our institutions often reward failure and malice, while punishing excellence and goodness.

Questioning consensus. Conventional wisdom develops very easily, especially when people are afraid that questioning it will make them seem unpatriotic. Despite my doubts, I initially felt very uncomfortable opposing the war because everybody seemed to think it was such a good idea. My parents, many friends, and several liberals who I admired at the time, like Tom Friedman and Tony Blair, supported it.

Being marginalized taught us how to build our own communities. Experiences of solidarity with fellow dissenters like the teach-in I attended provided me and other opponents of the war with a very powerful countervailing force. So did alternative sources of information and a handful of personal mentors. Many of the tools we used to unite against the Iraq War–blogs, social media–and groups we became active in, such as MoveOn.org, continue to be important vehicles for political awareness and activism on a broad array of progressive issues where our positions may contradict conventional wisdom.

There is no greater validator though than the passing of time. If we felt nervous and alone in our opposition to the war in 2003, by the following year, we had learned the value of sticking to our guns. Not every issue pans out so quickly or clearly. And of course we are not always right. But the collective experience of liberals on the eve of the Iraq War should at least give us the confidence we need not to discard our ideas merely because they are unpopular in a given moment.

Appreciating the full potential for abuse of power. For some time, I had trouble believing there wasn’t at least some significant national security justification for–or benefit from–the war. I couldn’t believe they would send people to their deaths based on complete fabrications.

Discovering how absurd the WMD claims shattered those doubts. If Bush and his surrogates could baldly lie about something like the much-vaunted “yellow cake,” and out a CIA agent whose husband discredited their claims, then, I thought, perhaps our leaders really were capable of the worst. (We later found out that the outed CIA agent, Valerie Plame Wilson, was involved in tracking the “proliferation of nuclear weapons materials into Iran,” which meant that when her cover was blown, it hindered our ability to keep track of Iran’s nuclear plans.) I began to accept the possibility that the entire case for war could be not only dubious, but a deliberately perpetrated sham.

Getting over the initial shock of the Iraq War lies empowered us to acknowledge equally outrageous violations of public trust that we might otherwise not have seen, as well as more mundane deceptions that allow politicians to escape accountability.

Accepting that bad guys and good guys often don’t get what they deserve. The aftermath of the Iraq War has undermined our confidence in our system’s ability to reward excellence and punish failure. Many of the war’s most right-wing proponents continue to enjoy power and credibility–eg, Bill Kristol, Lindsay Graham and John McCain.

John Kerry, who is now Secretary of State, did not apologize for voting for the war when he was the Democratic nominee for President in 2004. Instead, Kerry offered the disingenuous excuse that his vote was based on assurances from President Bush that Bush was going to exhaust diplomatic channels before invading, but then Bush “went back on his word” to Kerry. That Kerry’s binding vote to authorize force was based on a verbal assurance from President Bush was apparently supposed to bolster Kerry’s credibility.

Worse still, we fall for new idiotic dogmas peddled by the same discredited warmongers. When liberal war cheerleaders like Tom Friedman insist that cutting Social Security and Medicare is as urgent as they once thought invading Iraq was, Beltway elites still take them seriously.

Even the adjectives Friedman uses in describing the indispensability of the Grand Bargain tracks directly with his language advocating the Iraq War. Friedman in the New York Times, September 2011 (emphasis mine):

I’ve been arguing that the only antidote to this debilitating situation is a Grand Bargain between the two parties — one that cuts long-term entitlement spending and raises additional tax revenues…

Friedman on Charlie Rose, May 2003 (emphasis mine):

And there was only one way to do it…What they needed to see was American boys and girls going house to house, from Basra to Baghdad, and basically saying, ‘Which part of this sentence don’t you understand…Well, suck on this.’

The common denominator in both situations is that Friedman’s preferred idea is the only effective option.

And all of this has happened while the memory of the Iraq War is still fresh. Our memories will get worse as time passes, and then perhaps our pre-war naïveté will creep back in. After all, three decades after our parents’ generation lived through the Vietnam War, they fell for the lies that sent us to war with Iraq.

It’s somewhat fitting that a 30-foot geyser erupted from a broken water main practically around the corner from my home the night before the the American Society of Civil Engineers gave America a D+ on its 2013 infrastructure report card, and on the eve of a congressional vote on the only budget that includes the kind of infrastructure investment the country needs.

This was the scene last night, practically in my back yard.

Click here to view the video on YouTube.

A massive water main break in Chevy Chase blasted a 50-foot crater just off Connecticut Avenue on Monday night, sending a plume of water high into the air and triggering road closures, power outages and water restrictions.

Authorities said a tree pummeled by the geyser toppled about 5 a.m. Tuesday, bringing power lines down and complicating cleanup.

…The break in the 33-year-old, 54-inch pipe occurred in the 8400 block of Connecticut Avenue, across the street from Parkway Custom Dry Cleaning and about 100 yards south of the Capital Crescent Trail. The pipe, which runs north-south, adjacent to the street, is buried about 15 feet underground

Officially, the Washington Suburban Sanitary Commission was “unable to determine the cause of the break at this time.” At least one local news report cites WSSC as saying the break was the result of old, failing infrastructure.

The ASCE 2013 infrastructure report card gives the country a “D+” overall infrastructure grade, and recommends $3.6 trillion in infrastructure investment by 2020. The ASCE gave the country a “D” in drinking water, because of old, failing infrastructure, and noted an $84 billion shortfall in funding to meet our water infrastructure needs.

Although new pipes are being added to expand service areas, drinking-water systems degrade over time, with the useful life of component parts ranging from 15 to 95 years. Especially in the country’s older cities, much of the drinking water infrastructure is old and in need of replacement. Failures in drinking water infrastructure can result in water disruptions, impediments to emergency response, and damage to other types of infrastructure. Broken water mains can damage roadways and structures and hinder fire-control efforts. Unscheduled repair work to address emergency pipe failures may cause additional disruptions to transportation and commerce.

It is estimated that more than one million miles of water mains are in place in the United States. The conditions of many of these pipes are unknown, as they are buried underground out of sight, and owned and operated by various local entities. Some pipes date back to the Civil War era and often are not examined until there is a problem or a water main break. These breaks are becoming more common, as there are an estimated 240,000 water main breaks per year in the United States.

Determining pipe condition through cost-effective structural assessment will allow worst‐condition pipes to be addressed first, avoiding potential failures and associated risks, damages, and costs. These structural condition assessments will also help avoid premature replacement of structurally sound pipes to save resources and time. As a result of these benefits, demand for and value from these assessments is expected to increase significantly over the next 20 years.

The only budget in Washington that come close to addressing the country’s infrastructure needs is the Congressional Progressive Caucus’ “Back to Work Budget.”

We’re in a jobs crisis that isn’t going away.  Millions of hard-working American families are falling behind, and the richest 1 percent is taking home a bigger chunk of our nation’s gains every year. Americans face a choice: we can either cut Medicare benefits to pay for more tax breaks for millionaires and billionaires, or we can close these tax loopholes to invest in jobs.  We choose investment.  The Back to Work Budget invests in America’s future because the best way to reduce our long-term deficit is to put America back to work.  In the first year alone, we create nearly 7 million American jobs and increase GDP by 5.7%.  We reduce unemployment to near 5% in three years with a jobs plan that includes repairing our nation’s roads and bridges, and putting the teachers, cops and firefighters who have borne the brunt of our economic downturn back to work.  We reduce the deficit by $4.4 trillion by closing tax loopholes and asking the wealthy to pay a fair share.  We repeal the arbitrary sequester and the Budget Control Act that are damaging the economy, and strengthen Medicare and Medicaid, which provide high quality, low-cost medical coverage to millions of Americans when they need it most.  This is what the country voted for in November.  It’s time we side with America’s middle class and invest in their future.

The Back to Work Budget “substantially increases infrastructure investment to the level the American Society of Civil Engineers says is necessary to close our infrastructure needs gap,” by increasing investment in our roads, bridges, transit, energy, and water infrastructure — and creating 7 million jobs in the bargain. An Economic Policy Institute analysis shows that the investments in the “Back to Work” budget yield enormous returns by creating jobs while simultaneously meeting our infrastructure needs, and averting the loss of 3.5 million jobs if we don’t make necessary investments in infrastructure.

This morning’s news had me thinking about water infrastructure in particular, and specifically about whether my family will have water this evening, and whether that water will be safe for things like drinking and brushing teeth before bedtime. Our area is under mandatory water restrictions that could last up to a week, to “to ensure fire departments, hospitals and medical facilities have the water they need,” and to replenish the 60 million gallons lost when the main broke. So, we’re to reduce our water usage by 10 percent by taking shorter showers, limiting flushing toilets (not after every use), putting off doing laundry, and limiting the use of dishwashers to full loads — or face a $500 fine.

Maryland received both an overall infrastructure grade and a water infrastructure grade of “C-”. When I see that kind of grade on my kid’s report card, it usually means “needs improvement” — which usually means some parental investment of time and/or money, to make sure the necessary improvement actually happens. and failure is averted.

We witnessed one spectacular example of such failure last night, and endured the consequences this morning. The combined impact of the water main break and an overturned truck on the beltway snarled traffic this morning, extending commutes, and making lots of people (including yours truly) incredibly late for work. That’s a loss in productivity for businesses and organizations, especially for businesses nearest the scene of the break, many of which remained closed due to lack of running water, electricity, heating, etc.

According to The Washington Post, the water main that burst last night is exactly the kind of pipe that ruptured under River Road in 2008, leading to dramatic helicopter rescues, and exactly the same kind of pipe that bust near Capitol Heights in 2011. Another failed water main, which made the news in the time it took me to write this post main threatens to make getting back home this evening just as difficult as getting to work this morning. That’s two broken water mains today, and the day isn’t over yet.

It’s nothing new in Maryland.

We experience that kind of failure on a regular basis, especially in counties that have seen significant population growth. Montgomery County just became the first Maryland county to have more than 1 million residents. When decades-old infrastructure, weakened by lack of investment in upkeep and improvements, collides with the demands of a growing population, you get spectacular failure like those above.

You also get the kind of small failures that we see in our neighborhood, where the water main at the end of the block sprouts a new leak every year, around winter. And every winter that leak causes a sheet of ice to form on the road.

Every year the county responds to calls about the ice by salting the icy patch.

Every year the water utility responds by coming out and patching the old, leaky water main, which usually causes another old-water mail a block or two away to sprout a leak. The water utility workers sometimes work into the night, running back and forth between leaks, slowing down traffic and lengthening commutes, patching and patching until the leaking is stopped. Until next year, that is, when the whole cycle starts over again.

The ASEC says Maryland needs $5.4 billion in drinking water infrastructure investment in 20 years, to make needed improvements and avoid failures like the one that happened last night.

We either need to pass the “Back To Work” Budget, or we need to buy an ark.

The economy is not working for We, the People. But even with $4 trillion already cut from deficit projections, a deficit drop of about 50 percent as a share of gross domestic product, and Congressional Budget Office projections that the deficit is stable for the next 10 years Washington remains focused on even more economy-killing austerity. It’s talking only about what and how to cut instead of how to meet the needs of the people of the country and grow the economy.

This fight over spending cuts led to the “sequester,” which might take us back into recession. The fight will now roll into another manufactured crisis over the continuing resolution, with a government shutdown as the hostage, and of course this will be a further drag on the recovery.

Economics 101, Europe’s austerity experiment and the experience of history all tell us that cutting government is contractionary policy. Cutting government cuts economic growth and costs jobs, which leads to to lower tax revenue and higher government expenditures. Economics 101 and the experience of history also tell us that government investment in jobs, infrastructure, education, research and the rest grows the economy, which fixes deficits. Cutting deficits and debt is important but clearly should not be done when the economy is weak. This is the time to invest, and the investment returns will pay for the investment and more.

Again: There is no real discussion or debate about what we ought to be doing to make this economy work for working people. There is only discussion of what and how to cut. This is the wrong approach to our economic problems.

CAF is presenting job-creating and economy-growing ideas that ought to be debated so we can begin to turn this economy around and make it work for all of us instead of just a few of us. Jobs and growth fix deficits.

The Vast Trade Deficit Drains Our Economy And Jobs

Recently the 2012 U.S. international trade deficit in goods and services was announced. It fell slightly in 2012 (due in part to a decline in petroleum imports), to $540.4 billion from $560 billion in 2011. But 2012 saw a record trade deficit of $315 billion with China – approaching $1 billion a day. That is $540 billion a year drained from our economy, $315 billion of that just to China.

This vast trade deficit represents the loss of millions of jobs, tens of thousands of factories and entire industries. It hits at our ability to fix our economic problems. In particular, this problem affects our manufacturing companies, which provide solid, middle-class jobs and exports that strengthen the country.

Instead of the current focus on budget deficits, Washington should be talking about how to fix this vast trade deficit. Here are some of the things they should be talking about — and doing.

Fix Currency

Countries manipulate their currency rates because a “weak” currency means products made there are much more price-competitive. China’s currency is still estimated to be at least 20 percent below “market” rate, meaning goods made in China cost at least 20 percent less than goods made here, even before you factor in other things China does to give itself a trade advantage.

Confronting currency manipulation offers the biggest “bang for the buck,” requiring no tax dollars and reaping huge returns, shrinking the federal budget deficit by between $78.8 billion and $165.8 billion over three years.

Fixing this one problem could create between 2.2 million and 4.7 million jobs and increase GDP between 1.4 percent and 3.1 percent, helping manufacturers in particular, gaining between 620,000 and 1.3 million of those jobs. It would reduce the U.S. trade goods deficit by at least $190 billion and as much as $400 billion over three years.

Reform Trade Agreements

A $540 billion trade deficit doesn’t come from balanced trade; it is the result of one-sided trade agreements we have entered into. These trade agreements exposed America’s companies, workers, factories and tax base to direct competition with non-democracies, impoverished and exploited workers and countries that do not protect the environment. That could only go one way.

We have a democracy, in which people have a say. So they say they want good wages, safe workplaces and a clean environment. When we open that system up to direct, unregulated competition from places where people have no say and are told they can’t have those things, we put our democratic system at a competitive disadvantage in world markets. We make it a disadvantage to protect the environment, pay well, provide benefits, protect worker safety and the other things that we do and others do not do. Those become just “costs” to be eliminated.

Those trade agreements could have had different terms that lead to different results that lifted working people on both sides of the trade border instead of pushing terrible and increasing worldwide inequality. They could have lifted environmental protections on both sides of trade borders. They could have increased worker and consumer protections. They still can.

Our country’s trade agreements can still be reformed to do these things, rebalancing trade and lifting people and the environment. Future trade agreements should learn the lessons.

Bring Back The Bring Jobs Home Act

Last year Senate Republicans filibustered the Bring Jobs Home Act, but the bill had tremendous public support. It should be revived.

The Bring Jobs Home Act would have cut taxes for U.S. companies that move jobs and business operations to the United States, and ended tax loopholes that reward companies for shipping jobs overseas. The bill would have allowed companies to qualify for a tax credit equal to 20 percent of the cost associated with bringing jobs and business activity back to the United States. It would have closed a loophole allowing a company moving jobs overseas to deduct various relocation costs.

Additionally, any new bill should tax the overseas income of U.S. corporations the same way domestic income income is taxed, so there would be no tax advantage to them from shifting income and jobs overseas.

Strengthen Buy America In Federal And State Procurement

There is no reason our own government should be undermining American manufacturers. “Buy America” provisions should be a mandate on federal, state and local government purchases, consistent with our trade laws. To accomplish this, our bottom line should be:

• All federal spending should have “buy America” provisions giving American workers and businesses the first shot at procurement contracts.
• New federal loan guarantees for energy projects should require the utilization of domestic supply chains for construction.
• Our military equipment, technology and supply purchases should have increased domestic content requirements.
• Renewable and traditional energy projects should use American materials in construction. State-level spending should have similar requirements, as well as strategies for getting them in place.

Many state-level procurement laws are very weak. As a result, a lot of tax dollars go to purchase goods made overseas instead of goods made in the USA. States should also strengthen their procurement policies to promote buying American-made materials.

The Invest in American Jobs Act of 2013, announced Tuesday, is a good start and deserves support and discussion. The Act strengthens Buy America preferences, closes loopholes and improves transparency in the federal waiver process.

These are a few examples of the things that Washington should be talking about. These proposals solve real problems in practical ways that help the American people.

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