In my post about the rumored tax-cut stimulus package being tossed around at the White House, I quoted Dean Baker, who had some ideas on what you could do to stimulate the economy in a fantasy scenario. Since Republicans aren’t likely to let much of anything pass, and a jobs package would be an argument for the elections, something to run on, I think it’s worth making it as robust and attention-grabbing, and as functional, as possible. For example, paying unemployed people to do stuff as a policy.
However, people are actually hurting and need relief. So is there a way to provide them some without falling into the tax-cut trap, with all its long-term consequences?
Robert Kuttner thinks there’s a way, in particular using existing laws to reverse the disturbing, decades-long trend of falling wages.
Several laws on the books already prohibit theft of wages and phony classification of permanent workers as temps or contract hires and guarantee the right to organize or join a union and to be paid a minimum wage. None of these statutes is adequate, but under George W. Bush, the executive branch did its best not to enforce them.
Under President Barack Obama, prodded by the Task Force on Middle Class Working Families chaired by Vice President Joe Biden, the government has made some tentative steps toward better enforcement of labor laws. The Labor Department received an additional $25 million in its 2011 appropriation for enforcement of wage and hour standards, and plans are moving forward to revive other areas of enforcement that were deliberately sabotaged for nearly a decade.
The other source of leverage, potentially much more effective, is government’s power as a contractor [...] The Change to Win Federation, the Center for American Progress, and the National Employment Law Project have all proposed variants on the idea that government should reward contractors with good labor practices and avoid doing business with corporations that are labor scofflaws. In March 2009, the Obama administration embraced this idea in principle. The president issued three executive orders making it a little more difficult for government contactors to mistreat their employees, but with no meaningful enforcement mechanisms.
A new proposed presidential order setting up an embryonic system for giving modest preference to “high road” companies, after more than a year of internal debate, is still working its way through the bureaucracy of the Office of Management and Budget. Reportedly, the president has signed off on the concept, but the practical details are being challenged at each stage of review.
Even so, this initiative represents progress in principle. The challenge is to get on with it — and make it more than a token gesture.
These changes to labor enforcement laws would boost wages across the economy, increase wage competition, and force some of that business money sitting on the sidelines into circulation.
Obviously, the best way to scoop up that shortfall in demand is through better fiscal policy, or if you like, a mix of better fiscal and monetary policy. But a concerted effort to find and punish wage thieves, would reverse some sector-wide abuses and get more money in people’s pockets as they would earn what they actually should given US law. And rising wages would significantly bolster the economy.




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I don’t believe Obama will implement any of this. It does not help the privileged social class to which he aspires. Remember, the first rule of the Obama adiminstration: ordinary people ARE NEVER to benefit.
and may I ask, who is doing the challenging ?
And this why it is very important to support Obama and the dems. Obama can do a lot of good heading up the Executive Branch of govt where Bushies did so much damage. Did you see how well prepared FEMA was for hurricane EARL. Have you seen the numbers on illegal immigrants?? Have you about environmental enforcement, although I do think Salazar was slow in cleaning up the the slime in the EPA. Obama can do a lot of good without the Congress, but He could do a whole lot more with a real strong House and Senate.
The Kentucky AG/Dem Senate candidate Jack Conway is suing FedEx about their classification of workers as “independent contractors”
It may be because of his senate run but it is still the right thing to do.
There is absolutely no doubt that rising wages would help shore up the middle class, but since big corporations are masters of malevolence (Hi MOM), they will simply raise their prices for goods and services which brings the ‘floor’ up again and we are all poor.
Until the corruption and fraud inherent in the FIRE sector of the economy is drastically reigned in, no amount of rising wages is going to fix the problem as banksters and fraudsters will suck up the largess like those vampire squids sticking their blood funnel into anything that smells like money.
To wit: NOT ONE FUCKING PERSON HAS BEEN INDICTED DUE TO THE RAMPANT FRAUD AND THIEVERY THAT CAUSED THE ECONOMIC MELTDOWN. THEY HAVE ONLY GROWN STRONGER, LIKE HEALTH REFORM WILL ONLY MAKE THE INSURANCE COMPANIES STRONGER.
It used to be ‘Justice For All’ but now it is ‘Justice for the “lesser people”‘ as in fuck us all and throw as many of us in jail as possible while ‘justice’ for the rich is monopoly power and airplane loads of taxpayer cash for the furtherance of their nefarious goals.
I was very impressed with this, actually. Do you think people will see it as being to their advantage, or will voters side with the poor put-upon corporation?
I don’t understand why Obama doesn’t propose a Paycheck Tax Holiday — let workers keep the federal taxes in their paychecks for a coupla pay cycles in October but don’t call it a Tax Cut.
Holiday sounds very Democratic; Tax Cut sounds like a GOP idea. Not sure — does he need Congressional action to simply not collect taxes for a coupla payrolls?
I think they’ll see it as a positive but it’s an US against Them theme on a couple of levels as FedEx is headquartered in Memphis and most Kentuckians are willing to see things in Tennessee tweaked. Plus UPS as the FedEx competitor is headquartered in Louisville so Conway is standing up for the home team in this suit as well.
I don’t think anything the Democrats do or try to do at this point is going to make any difference in November. The view of them is cemented at this point.
Higher wages is nice.
Unfortunately, the likely scenario is that the GOP takes over at least one if not both houses of Congress, the economy recovers next year and the GOP gets credit.
Not fair, but that is how the public always sees it. Whoever is in power gets the credit. So, Obama will get some, but people will see, “Oh, we changed to the GOP and now things are better.”
Obama had a chance to enhance the image of progressive policies, but he has ended up destroying the image. Even though he didn’t actually implement progressive policies. The board public think he did.
….using existing law to reverse the disturbing, decades-long trend of falling wages…
If my attorney friend Alf were here he would say. ‘You are assuming a fact not in evidence.’ (He says that a lot). Said fact being that the MOTU (and I include among MOTU the President and his Administration) are in any wise disturbed by the decades-long trend of falling wages. I think the MOTU are all for falling wages. I think they think they can outsource consumption as easily as they can outsource production. So what the hell do they need us for anyway? To hell with us and our falling wages.
Only the left could think that making labor more expensive will enhance their prospects of employment. It won’t.
To be consistent, I’m sure that you turn down all raises in order to enhance your prospects of remaining employed.
If your not fighting for our side in the class war your fighting for the other side. democrats and their reliable mouthpieces in the media (chris mathews,jonathan alter, et al) are now talking about the “need” to continue ALL of the bush tax cuts. well, what a suprise! this is of course the other side of the catfood commision coin, and always was the objective of the administration and thier reliable allies in congress( eassentially the entire caucus). They are not merely reacting situationally, this has ALWAYS been the plan, probably from the spring of 09. It appears that the American left is not only ineffective, but that its also imaginary. i think we are seeing the limits of internet activism. a great tool for spreading information, fundraising and catharsis, but not so effective in combating the metasticization of the right.we need to start building an actual, physical movement on the ground.demonstrations would be a start. I bet we can get more people at the lincoln monument than glen blecchh. we really need to stop treating activism as if it were some unseemly anachronistic relic from the past. we are living on the sucess of leftists from the(ever more distant) past and we are running out of capital.
yes they are using high unemployment to attack wages again. why not, its worked very well for them for the last 30 years.
Of course he doesn’t turn down the raises. After all, they are a reflection on the wonderfulness that is someone who sucks up to management any way he can.
your assuming that Obama wants to do “a lot” of “good”. i guess the problem is we have to agree on whats good. i dont think taking a movement and large majorities in both houses of congress to enact pro corporate, anti labor, anti environment laws and policies is a “good” thing but thats where we are.
no he DESERVES them. hes talking to all the rest of us who dont.
Is Shooter’s nose brown, too?
The problem is that not enough people are getting paychecks, not that they’re paying too much in taxes. Or they’re worried that their paycheck is going to end. What’s needed is a way to stimulate demand and consumption in an economy that has been built around overconsumption. I don’t think there’s an economist alive that can figure out how to do that without creating another bubble of some kind.
Right on!