The Miami Heat?
The Baltimore Ravens?
Nope. It’s the 1% stomping all challengers in the income game. Al Jazeera America reports that the richest of the rich collect 19.3% of all income earned in the U.S. in 2012, which is the largest share in IRS records for the past century. 95% of income increases since 2009 have gone to the top 1%, which is defined as income over $394,000 in 2012.
In some ways, these numbers aren’t surprising because they are part of a trend, more of the same. What is surprising is that so many Americans accept this situation as normal. Since the Reagan presidency, tax laws have been rigged to help the most wealthy. Meanwhile, the middle class pays more of its declining income to support the social programs needed by employees of companies like Walmart and McDonalds that pay low wages. 99% of America needs a raise.
I’m on a mailing list from the Chicago Teachers Union, which is a great source of information not heard in the corporate media. Today, I received the following analysis by Kenzo Shibata, the union’s New Media Coordinator:
“Why do Mayor Rahm Emanuel, the Chicago Board of Education and Chicago Public Schools officials blame Springfield for the district’s budget woes? Why is the target of their concern being shifted to state legislators? It polls well but makes little sense. Let’s examine why.
FACT: The Illinois General Assembly has provided Chicago Public Schools with every opportunity to make their budget work by giving the district a 13-year break from paying pensions. FACT: The district has failed to lobby for a more equitable funding formula, search for new revenue streams or reform programs like TIF that could work better for school districts and redevelopment.
FACT: The city and the Chicago Board of Education’s answers to the revenue crisis have been to cut, and this year, the cuts will have a devastating impact on classrooms across the city.
FACT: Pensions are NOT the problem.
The problem is a pronounced lack of leadership from the mayor and his handpicked Board of Education.
The state legislature, beginning in 1995, provided CPS with the tools to plug its budget issues and time find new revenue streams and reform the TIF program. The timeline looks like this:
1995—The Illinois State Legislature gave then-Mayor Richard M. Daley the ability to use the once restricted pension levy for operating costs to ensure balanced district budgets. The school district enjoyed a 10-year “holiday” from making any payments into the pension fund. The fund prior to 1995 was funded above 100 percent. It wasn’t until 2005 when the fund dipped slightly below 90 percent that the district resumed payment.
2010—The Illinois State Legislature gave Chicago Public Schools a pension holiday that provided the district with more pension relief so the classrooms in Chicago would not feel any negative financial impact. CPS also was granted additional federal funding from a stimulus appropriation; the district still laid-off more than 1,300 teachers despite pension relief from the state and an infusion of money from the federal government.
2012—The Illinois State Legislature gave CPS an extension on the deadline to publicly announce which schools were slated for closure. CPS stated that schools needed to be closed because of a looming budget crisis and that closing schools would help stymie the deficit.
2013—The Illinois State Legislature did not move on the moratorium on school closings proposed by Chicago legislators, citing that the state wanted to provide newly minted CPS CEO Barbara Byrd-Bennett with the opportunity to govern the district. In short, the consensus was that the state legislature did NOT want to micromanage the school district.”
Shibata’s analysis leads us to ask again: Did teachers cause this problem? No. Why are they being asked to pay for it, to suffer during their retirement? We need to remember that Detroit is the blueprint. Chicago looks like it could be the next stop on the bankers-rip-off-workers express. We need to stop this train – now.
Today’s Huffington Post offers a fascinating and frightening analysis of youth unemployment. The overall loss to the nation is estimated at $18 billion, but behind that big number are millions of young people who will struggle to survive. Beyond the unemployed most of the new jobs created over the past few years have been low wage, which means that many other young people are starting their careers with little opportunity to save money.
While we need to pay attention to unemployment, we should also look to other factors that impact young people, such as student debt. Young people who attend college are less likely to be unemployed, but they are often leaving school with a debt equal to a small mortgage. If Congress does nothing (which is what it has done best over the last few years), interest on student loans will double later this summer.
Our political leaders need to start focusing on this problem. However, given their general failure to care about working people and the unemployed, it’s most likely that the problems described above will only get worse, and young people will suffer because their elders are acting like children.
[On Sundays, this blog explores topics beyond the work world in “Sabbath.”]
Detroit and Democracy
I wanted to do more to prepare more to write this post, but I’ve had work responsibilities this week and weekend that would not let me dive into research and numbers. Even so, I feel a need to express my less than informed opinion on a vital topic – the impending takeover of Detroit.
It’s not the big media story I thought it would be. It’s taken as a given that Detroit is “bankrupt” and “something has to be done.” I’ve even heard that claim in progressive media. Is Detroit in trouble? Of course, it is. So are many other large American cities that have lost their industrial base. No one seems to be asking if there are alternatives to taking power from the hands of elected officials and putting it in the hands of an unelected Emergency Manager. Governor Rick Snyder presents this solution that he has introduced in other cities as the only way to save the state’s biggest city.
Let’s take a minute and ask some questions:
1. Is the situation as bad as the governor claims? Why is Michigan the only state in the nation where such action is taking place on such a scale? Is the governor really concerned about helping cities, or is he working off an ALEC playbook strategy to transfer public wealth into private hands? Is there any evidence that Emergency Managers in other cities have made a long term improvement in local conditions – long term, not a simple give away to the connected class?
2. Where is the wealth? Throughout America, central cities are surrounded by suburbs that conduct business in and take their identity from the urban hub. Could some system be devised where those who benefit from the hub pay their share for its upkeep? Why not tax suburbs that have a surplus? Why not introduce county wide or regional taxes that would help revive great American cities?
Here in Chicago we’ve had similar claims of impending ruin. One of Mayor Daley’s chief aides used the term “Doomsday” in talking about the state of the city’s school system and public transit system. Both systems were cut in the face of such claims. Mayor Daley also transferred public assets of parking meters and a public toll road to private interests. The city’s finances are not better. In fact, by the end of the contract, the city will lose money on the parking meter contract. Now Mayor Emanuel want to close over 100 schools because of a pending billion dollar deficit. Is this a real problem or a way to move students from public to “charter” schools?
Whenever a politician claims a situation is an emergency, we need to ask for better evidence and transparency, not solutions that make the original problem worse and benefit only those who are the most wealthy. We need to ask harder questions about our leaders and their solutions, especially those that deal with privatization. The fate of Detroit and other cities in Michigan need to seen as a sign of things to come. Will the U.S. live up to its promise of being a democracy that offers opportunity to all of its people, including the poor? Or will the country further devolve into an oligarchy of the wealthy, by the wealthy, and for the wealthy?
Postscript: On this weekend’s Smiley and West radio program, Cornel West said: “You can’t love money and love poor people.” He was criticizing political leaders, both Republicans and Democrats. I can only respond with one word: Amen.
More: Laura Clawson of Daily Kos weighs in on the consequences of a Detroit take over and what has happened in other Michigan cities that have lost their democratic rule.
Writing in Think Progress, Pat Garofalo reports that Wisconsin legislators are now trying to attack private sector unions in the name of “preventing layoffs.” The plan is called “work-sharing,” and it would allow companies with union workers to cut hours without consulting unions. The only way working people will be safe from such schemes is to vote for politicians who support labor rights; however, they are hard to find these days. It will be interesting to see how Governor Walker reacts if this measure is passed. Who frightens him more, the Koch Brothers or the voters?
All eyes on Wisconsin – again.