Failing to Deliver: Manufacturing Wages Aren’t What They Used to Be
By Deirdre Fulton | Common Dreams | November 21, 2014
Though nine out of ten Americans perceive blue-collar jobs as “good jobs” and policymakers tout the benefits of expanding the country’s manufacturing base, the truth is that factory wages now rank in the bottom half of those for all jobs in the U.S., according to a new study from the National Employment Law Project (NELP).
The report, Manufacturing Low Pay: Declining Wages in the Jobs That Built America’s Middle Class (pdf), reveals that while the manufacturing sector has experienced a rebound in recent years, in fact “the quality of too many of the returning jobs is low and fails to live up to workers’ and the overall public’s expectations.”
“Manufacturing jobs are… highly sought after by our federal and state policymakers,” write co-authors Catherine Ruckelshaus and Sarah Leberstein, “lauded as ‘advanced industries’ that generate investments, create a high number of direct and indirect jobs, enhance worker skills, and generate additional economic activity in related industries.”
But “while the manufacturing sector has been resurging in the last few years, growing by 4.3 percent between 2010 and 2012, the jobs that are returning are not the ones that were lost: wages are lower, the jobs are increasingly temporary, and the promised benefits have yet to be realized,” they write.
Specifically, the study finds that:
- More than 600,000 manufacturing workers make just $9.60 per hour or less and more than 1.5 million manufacturing workers—one out of every four—make $11.91 or less;
- Real wages for manufacturing workers declined by 4.4 percent from 2003 to 2013—almost three times faster than for workers as a whole.
- In the largest segment of the manufacturing base—automotive—wages have declined even faster. Real wages for auto parts workers, who now account for three of every four autoworker jobs, fell by nearly 14 percent from 2003 to 2013—three times faster than for manufacturing as a whole, and nine times faster than the decline for all occupations.
- In particular, new jobs in the auto industry pay less than the jobs that were lost. New hires in auto earn less than $10 an hour.
- Heavy reliance on temporary workers hides even bigger declines in manufacturing wages. About 14 percent of auto parts workers are employed by staffing agencies today. Wages for these workers are lower than for direct-hire parts workers and are not included in the official industry-specific wage data cited above.
“What will these jobs look like in 10 years if these trends continue?” the report asks. “If the wage trends continue, manufacturing jobs will not deliver on the promise of creating livable jobs with positive economic revivals in communities and families.”
Writing at the Campaign for America’s Future blog, Dave Johnson blames globalization and so-called free-trade pacts for exacerbating—if not directly causing—the issues raised in NELP’s report.
“American factory jobs used to provide reasonable pay and benefits—largely because of unions and democracy. So how do you make manufacturing jobs more ‘efficient?’ You can move the factory to a country that doesn’t allow unions. Our country used to recognize this game and ‘protected’ the good wages and benefits that democracy provided people with tariffs that raised to price of goods made in places that allowed exploitation of working people. Solution: ‘free trade’ that pits our democracy against thugocracies with few or no protections for people or the environment.
Free trade’ worked—to force unemployment up and wages down. We lost more than 6 million manufacturing jobs and 60,000-plus factories between 2000 (the year before China entered the World Trade Organization) and 2010.
With approval of the corporate-friendly Trans-Pacific Partnership on the horizon, NELP’s findings are a wake-up call, writes Scott Martelle for the LA Times.
“We as a nation need to press the federal government to rethink trade policies, especially as it pushes for ever more deals to make it easier to ship goods and jobs around the world,” he says. “The looming Trans-Pacific Partnership (look at it as NAFTA for the Pacific Rim) might be good for global manufacturers and American consumers, but those consumers are also American workers. Driving down retail prices while also driving down family incomes is the wrong spiral for community stability and a steady or improving standard of living.
Martelle continues: “A century ago, Henry Ford figured out that if he wanted a mass market capable of buying his cars—cheaper to make with his moving assembly line—then he needed to pay higher wages. He understood the connection between wages paid and products bought. These days, the focus seems to be more on wages squeezed. And that’s no way to preserve, or strengthen, a middle class capable of driving a vibrant consumer economy.”
All-Out War in Ukraine: NATO’s ‘Final Offensive’
By James Petras :: 11.20.2014
Introduction
There are clear signs that a major war is about to break out in Ukraine: A war actively promoted by the NATO regimes and supported by their allies and clients in Asia (Japan) and the Middle East (Saudi Arabia).
The war over Ukraine will essentially run along the lines of a full-scale military offensive against the southeast Donbas region, targeting the breakaway ethnic Ukraine- Russian Peoples Republic of Donetsk and Lugansk, with the intention of deposing the democratically elected government, disarming the popular militias, killing the guerrilla resistance partisans and their mass base, dismantling the popular representative organizations and engaging in ethnic cleansing of millions of bilingual Ukraino-Russian citizens. NATO’s forthcoming military seizure of the Donbas region is a continuation and extension of its original violent putsch in Kiev, which overthrew an elected Ukrainian government in February 2014.
The Kiev junta and its newly ‘elected’ client rulers, and its NATO sponsors are intent on a major purge to consolidate the puppet Poroshenko’s dictatorial rule. The recent NATO-sponsored elections excluded several major political parties that had traditionally supported the country’s large ethnic minority populations, and was boycotted in the Donbas region. This sham election in Kiev set the tone for NATO’s next move toward converting Ukraine into one gigantic US multi-purpose military base aimed at the Russian heartland and into a neo-colony for German capital, supplying Berlin with grain and raw materials while serving as a captive market for German manufactured goods.
An intensifying war fever is sweeping the West; the consequences of this madness appear graver by the hour.
War Signs: The Propaganda and Sanctions Campaign, the G20 Summit and the Military Build Up
The official drum- beat for a widening conflict in Ukraine, spearheaded by the Kiev junta and its fascist militias, echoes in every Western mass media outlet, every day. Major mass media propaganda mills and government ‘spokesmen and women’ publish or announce new trumped-up accounts of growing Russian military threats to its neighbors and cross-border invasions into Ukraine. New Russian incursions are ‘reported’ from the Nordic borders and Baltic states to the Caucusus. The Swedish regime creates a new level of hysteria over a mysterious “Russian” submarine off the coast of Stockholm, which it never identifies or locates – let alone confirms the ‘sighting’ of. Estonia and Latvia claim Russian warplanes violated their air space without confirmation. Poland expels Russian “spies” without proof or witnesses. Provocative full-scale joint NATO-client state military exercises are taking place along Russia’s frontiers in the Baltic States, Poland, Romania and Ukraine.
NATO is sending vast arms shipments to the Kiev junta, along with “Special Forces” advisers and counter-insurgency experts in anticipation of a full-scale attack against the rebels in the Donbas.
The Kiev regime has never abided by the Minsk cease fire. According to the UN Human Rights office 13 people on average –mostly civilians –have been killed each day since the September cease fire. In eight weeks, the UN reports that 957 people have been killed –overwhelmingly by Kiev’s armed forces.
The Kiev regime, in turn, has cut all basic social and public services to the Peoples’ Republics’, including electricity, fuel, civil service salaries, pensions, medical supplies, salaries for teachers and medical workers, municipal workers wages; banking and transport have been blockaded.
The strategy is to further strangle the economy, destroy the infrastructure, force an even greater mass exodus of destitute refugees from the densely populated cities across the border into Russia and then to launch massive air, missile, artillery and ground assaults on urban centers as well as rebel bases.
The Kiev junta has launched an all-out military mobilization in the Western regions, accompanied by rabid anti-Russian, anti-Eastern Orthodox indoctrination campaigns designed to attract the most violent far right chauvinist thugs and to incorporate the Nazi-style military brigades into the frontline shock troops. The cynical use of irregular fascist militias will ‘free’ NATO and Germany from any responsibility for the inevitable terror and atrocities in their campaign. This system of ‘plausible deniability’ mirrors the tactics of the German Nazis whose hordes of fascist Ukrainians and Ustashi Croats were notorious in their epoch of ethnic cleansing.
G20-plus-NATO: Support of the Kiev Blitz
To isolate and weaken resistance in the Donbas and guarantee the victory of the impending Kiev blitz, the EU and the US are intensifying their economic, military and diplomatic pressure on Russia to abandon the nascent peoples’ democracy in the south-east region of Ukraine, their principle ally.
Each and every escalation of economic sanctions against Russia is designed to weaken the capacity of the Donbas resistance fighters to defend their homes, towns and cities. Each and every Russian shipment of essential medical supplies and food to the besieged population evokes a new and more hysterical outburst – because it counters the Kiev-NATO strategy of starving the partisans and their mass base into submission or provoking their flight to safety across the Russian border.
After suffering a series of defeats, the Kiev regime and its NATO strategists decided to sign a ‘peace protocol’, the so-called Minsk agreement, to halt the advance of the Donbas resistance into the southern regions and to protect Kiev’s soldiers and militias holed-up in isolated pockets in the East. The Minsk agreement was designed to allow the Kiev junta to build up its military, re-organize its command and incorporate the disparate Nazi militias into its overall military forces in preparation for a ‘final offensive’. Kiev’s military build-up on the inside and NATO’s escalation of sanctions against Russia on the outside would be two sides of the same strategy: the success of a frontal attack on the democratic resistance of the Donbas basin depends on minimizing Russian military support through international sanctions.
NATO’s virulent hostility to Russian President Putin was on full display at the G20 meeting in Australia: NATO-linked presidents and prime ministers, especially Merkel, Obama, Cameron, Abbott, and Harper’s political threats and overt personal insults paralleled Kiev’s growing starvation blockade of the besieged rebels and population centers in the south-east. Both the G20’s economic threats against Russia and the diplomatic isolation of Putin and Kiev’s economic blockade are preludes to NATO’s Final Solution – the physical annihilation of all vestiges of Donbas resistance, popular democracy and cultural-economic ties with Russia.
Kiev depends on its NATO mentors to impose a new round of severe sanctions against Russia, especially if its planned invasion encounters a well armed and robust mass resistance bolstered by Russian support. NATO is counting on Kiev’s restored and newly supplied military capacity to effectively destroy the southeast centers of resistance.
NATO has decided on an ‘all-or-nothing campaign’: to seize all of Ukraine or, failing that, destroy the restive southeast, obliterate its population and productive capacity and engage in an all-out economic (and possibly shooting) war with Russia. Chancellor Angela Merkel is on board with this plan despite the complaints of German industrialists over their huge loss of export sales to Russia. President Hollande of France has signed on dismissing the complaints of trade unionists over the loss of thousands French jobs in the shipyards. Prime Minister David Cameron is eager for an economic war against Moscow, suggesting the bankers of the City of London find new channels to launder the illicit earnings of Russian oligarchs.
The Russian Response
Russian diplomats are desperate to find a compromise, which allows Ukraine’s ethnic Ukraine- Russian population in the southeast to retain some autonomy under a federation plan and regain influence within the ‘new’ post-putsch Ukraine. Russian military strategists have provided logistical and military aid to the resistance in order to avoid a repeat of the Odessa massacre of ethnic Russians by Ukrainian fascists on a massive scale. Above all, Russia cannot afford to have NATO-Nazi-Kiev military bases along its southern ‘underbelly’, imposing a blockade of the Crimea and forcing a mass exodus of ethnic Russians from the Donbas. Under Putin, the Russian government has tried to propose compromises allowing Western economic supremacy over Ukraine but without NATO military expansion and absorption by Kiev.
That policy of conciliation has repeatedly failed.
The democratically elected ‘compromise regime’ in Kiev was overthrown in February 2014 in a violent putsch, which installed a pro-NATO junta.
Kiev violated the Minsk agreement with impunity and encouragement from the NATO powers and Germany.
The recent G20 meeting in Australia featured a rabble-rousing chorus against President Putin. The crucial four-hour private meeting between Putin and Merkel turned into a fiasco when Germany parroted the NATO chorus.
Putin finally responded by expanding Russia’s air and ground troop preparedness along its borders while accelerating Moscow’s economic pivot to Asia.
Most important, President Putin has announced that Russia cannot stand by and allow the massacre of a whole people in the Donbas region.
Is Poroshenko’s forthcoming blitz against the people of southeast Ukraine designed to provoke a Russian response – to the humanitarian crisis? Will Russia confront the NATO-directed Kiev offensive and risk a total break with the West?
James Petras latest book is THE POLITICS OF IMPERIALISM:THE US,ISRAEL AND THE MIDDLE EAST (CLARITY PRESS:ATLANTA)
Life sentences restored for two Palestinian prisoners released in Shalit deal
MEMO | November 21, 2014
The Israeli authorities restored the previous life sentences issued against two Palestinian prisoners who had been released as a part of the Shalit deal, Felesteen Online news reported on Friday.
One prisoner is from Tulkarem and the other Nablus, in the occupied West Bank.
According to Felesteen Online, the director of the Ahrar Centre for Prisoners Studies and Human Rights, Fuad Al-Khafsh, announced that the Israeli authorities had re-issued the life sentences on the two released prisoners, Ashraf Al-Wawi from Tulkarem and Hamza Abu Arkoub from Nablus.
Since tensions started escalating in the occupied Palestinian territories last summer, the occupation authorities have detained thousands of Palestinians, including re-arresting dozens of former prisoners released as part of the Shalit exchange deal in 2011.
UK journalists take legal action against police spying
Press TV – November 21, 2014
Six British journalists have filed a lawsuit against the Scotland Yard after documents showed that the police in London were spying on them for more than a decade.
The lawsuit, which was filed by the National Union of Journalists against London’s Metropolitan Police and the Home Office, was announced late Thursday.
The group of journalists, including three photographers, an investigative journalist, a newspaper reporter and a freelance video journalist, took legal action after they discovered the Metropolitan Police had been recording their professional activities on a secret database.
The database was reportedly designed to monitor so-called domestic extremists.
The records included the movements of the journalists while working, their appearance and how they used a camera to record the events they were covering.
Freelance photographer David Hoffman questioned why he had been labeled as an extremist in the files kept by the police, saying he has “never contemplated any sort of extreme action of a political or criminal nature.”
The journalists said the lawsuit is aimed at exposing the persistent pattern of journalists being assaulted, monitored and stopped and searched by police during their work.
The group is also seeking to force the police to destroy the files containing records of their activities, saying the surveillance violates the liberty of the press and their privacy.
Both the Metropolitan police and the Home Office have declined to comment on the legal action.
The lawsuit comes as recent public disclosures of police records have revealed that Scotland Yard secretly seized journalists’ telephone records.
Several senior police officers have acknowledged keeping an eye on journalists by using powers granted under anti-terrorism measures.
A previous lawsuit by five journalists resulted in the police apologizing or paying damages for wrongdoing, including assault and unjustifiable searches while they were working.
UN Resolution on Iran Mockery of Justice
By Ismail Salami | Press TV | November 20, 2014
The not-very-independent UN body has made a mockery of justice by soldering a resolution on the so-called human rights violations in Iran.
The farce becomes more markedly absurd when you consider the plethora of human rights abuses going unpunished in the world with the UN laying a lid of ignorance on these blatant violations.
Late Tuesday, the United Nations voted to slam “Iranian human rights abuses”, singling it out for “executing upwards of 1,000 political opponents and prisoners in the past year”.
Iran has strongly lambasted the UN resolution, saying that “the UN’s legal mechanisms have turned into a tool in the hands of the West.”
The irony of the resolution is that the measure was initially drafted by Canada which has, itself, a disgraceful history of human rights abuse against the aborigines in the country. Further to that, Ottawa has constantly and vehemently thrown its full-throated support behind Tel Aviv in its inconceivably ruthless crimes against the people of Palestine.
In July 2014, when Gaza was being pounded by Israeli bombs and the Palestinian women and children were consequently incinerated and brutally slaughtered, when human rights were being trampled in its most pernicious forms, the Canadian government brazenly backed the Israeli regime and instead rubbed salt in Palestinian wounds. Canadian Prime Minister Stephen Harper issued a statement and said, “The indiscriminate rocket attacks from Gaza on Israel are terrorist acts, for which there is no justification…. Failure by the international community to condemn these reprehensible actions would encourage these terrorists to continue their appalling actions. Canada calls on its allies and partners to recognize that these terrorist acts are unacceptable and that solidarity with Israel is the best way of stopping the conflict. Canada is unequivocally behind Israel.”
Yes, Canada is unequivocally and cravenly behind Israel. These are strange times. Those who are harbingers of terror and atrocity become the emblems of innocence and the downtrodden people of Gaza become terrorists. These remarks by Mr. Harper only relegate him to a very lowly level of humanity and leave no room for his exoneration from complicity in the crimes perpetrated at the hands of the Israeli regime against the Gazans.
Ahmed Shaheed, the UN Special Rapporteur on Human Rights in Iran, has even voiced his praise for Canada’s determining role in conducing to this mockery of justice about Iran, saying, “Canada’s leadership in this regard is highly appreciated.”
In May 2014, Canadian Liberal MP Irwin Cotler who served as the Minister of Justice and Attorney General of Canada from 2003 until 2006 embarked on a series of programs known as Iran Accountability Weeks in which they heard “testimonies highlighting Iranian political prisoners and other victims of Iranian human rights abuses.” Among those who testified was the notorious terrorist MKO leader Maryam Rajavi accompanied by a UN rights official and pundits from a hawkish American think tank.
Interestingly, Mr. Shaheed was a participant in the event. Although he says he asked his name to be withdrawn from the panel, there is barely an iota of truth in it as in his report on Iran. The sheer presence of Maryam Rajavi in the anti-Iran mudslinging campaign sheds light on the very nature of the UN-released resolution against Iran.
Besides, it is not a closed book to anyone that Irwin Cotler is a fervent advocate of Tel Aviv and his insistence on having Rajavi on the anti-Iran panel reveals the dirty hands behind the report. So, the pieces of the puzzle come together to make a meaningful whole in this regard.
Over the past three decades, the MKO has initiated a series of deadly attacks on Iran and the Iranian population and has so far assassinated 12,000 Iranians including nuclear scientists. It is interesting to note that the assassinations of prominent Iranian characters including the politicians and scientists are basically conducted in cahoots with Israeli Kidon, the assassination unit within Mossad.
In 1986, the MKO headquarters were transferred to Iraq during the Iran-Iraq war and Saddam took them under his wings and funded them financially and militarily to fight against Iran. Long listed as a terrorist organization by the international community, the cult was delisted on September 28, 2012 by the US Secretary of State as an extension of their adage that a terrorist in need is a friend indeed.
Some of their sabotaging activities are as follows:
- The series of mortar attacks and hit-and-run raids during 2000 and 2001 against Iranian government buildings; one of these killed Iran’s chief of staff
- The 2000 mortar attack on President Mohammad Khatami’s palace in Tehran
- The February 2000 “Operation Great Bahman,” during which MEK launched 12 attacks against Iran
- The 1999 assassination of the deputy chief of Iran’s armed forces general staff, Ali Sayyad Shirazi
- The 1998 assassination of the director of Iran’s prison system, Asadollah Lajevardi
- The 1992 near-simultaneous attacks on Iranian embassies and institutions in 13 countries
- Assistance to Saddam Hussein’s suppression of the 1991 Iraqi Shiite and Kurdish uprisings
- The 1981 bombing of the offices of the Islamic Republic Party and of Premier Mohammad-Javad Bahonar, which killed some 70 high-ranking Iranian officials, including President Mohammad-Ali Rajaei and Bahonar Support for the 1979 takeover of the U.S. Embassy in Tehran by Iranian revolutionaries
- The 1970s killings of U.S. military personnel and civilians working on defense projects in Tehran
Viewed from an entirely different angle, the measure very bizarrely coincides with the nuclear talks between Iran and the world six world powers and the November 24 deadline. So, the move may be seen as a last-ditch effort by pro-Israeli lobbies to proceed with their scenario of Iranophobia on the one hand and to sabotage the nuclear talks and bring them to a standstill on the other hand.
The UN consciously or unconsciously plays into the hands of the pro-Israeli pressure groups in Canada and only puts on an ugly show of duplicity in imposing a ruling against the Islamic Republic.
My Town Fought Wal-Mart – and Wal-Mart Won
By Christopher Orlet | CounterPunch | November 21, 2014
Four years ago, the developer of a proposed Wal-Mart supercenter in Florissant, Mo. (pop. 52,000) appeared before city leaders. For decades Wal-Mart had wanted to open a supercenter in my hometown and on this particular Monday evening a representative from THF Realty – Wal-Mart’s longtime developer of choice – was alternately putting on the poor mouth and subtly threatening city officials. In order to fund the development, a project developer told the city council, THF Realty would require $9 million in tax breaks.
No tax breaks, no Wal-Mart.
In brief, THF wanted a TIF – tax incremental financing, which meant the portion of the development’s property tax revenue that ordinarily would go to local schools, police, libraries and fire departments, instead would remain in the pockets of the developer.
Such threats, coming from multibillionaire developers, are commonplace. They are also effective. Though not as effective as they once were.
THF Realty (the acronym stands for To Have Fun) owns or leases more than 100 shopping centers in 22 states, many anchored by Wal-Mart stores or Sam’s Club. That’s due in part to THF’s chairman – sports and real estate tycoon Stan Kroenke – being married to Wal-Mart heiress Ann Walton. The last time Kroenke was obligated to disclose his ties with Wal-Mart – when he served on Wal-Mart’s board of directors 13 years ago – his company was renting 55 stores to the giant retailer.
Today, Kroenke — the 105th richest American — has an estimated net worth of $5.7 billion. His wife, Ann, is worth an estimated $4.8 billion. Kroenke owns the Denver Nuggets, the Colorado Avalanche, the St. Louis Rams, the Colorado Rapids and, in a sure sign that he is running out of ways to unload his billions, the English soccer club Arsenal.
Wal-Mart doesn’t always use outside developers (or inside developers like Kroenke) to build its discount stores and supercenters. “Sometimes Wal-Mart is itself the developer,” says Al Norman, an anti-sprawl consultant. When Wal-Mart purchases and develops a site it utilizes the Walmart Real Estate Business Trust, one of its many subsidiaries.
“[But] if Wal-Mart hasn’t bought the land, it’s better for them to put the burden on a developer to get all the permits, ask for the subsidies, and make any land agreement contingent on the developer having all the permits in place,” says Norman. Using outside developers, however, allows Wal-Mart to benefit from government subsidies without being the one making the pitch for the handout.
If Wal-Mart hoped to draw attention away from itself by using this tactic in Florissant it failed. For the most part the public regarded the proposed development as a Wal-Mart project and refused to distinguish between Wal-Mart and its developer. And local media played up the connection: “Florissant Council Turns Down Wal-Mart Developer,” cried one headline.
In many ways Florissant, Mo., a working class city in North St. Louis County, is no different than most American cities. When it comes to big box shopping centers its philosophy seems to be that a town can never have too many. Florissant’s sprawling main drag, Lindbergh Boulevard, is an unbroken chain of such shopping centers, with only a few acres of unadorned, treeless asphalt parking lot separating them. Each center has a large grocery store chain or a big box retailer (Target, Kmart, Michaels, Sears, Lowes, Home Depot, Office Depot) as its anchor.
Nor can it be said that Florissant residents are suffering a dearth of Wal-Marts. There’s a supercenter four-and-a-half miles away in Ferguson (you may recall that it was vandalized during the recent Ferguson riots). Another Wal-Mart waits 13 miles away in Bridgeton. Yet another sits 14 miles down the road in Granite City, Ill. And another 14 miles away in the opposite direction in St. Charles.
Fortunately for Wal-Mart and its developers, they do not have to show a need or demonstrate likely economic benefits to the community to receive subsidies and tax breaks. They need only ask and they shall receive.
Wal-Mart was no disinterested party in THF’s quest for tax breaks. A TIF could mean big savings for the retailer.
“Wal-Mart is in a position to negotiate lower lease rates when the developer is being subsidized,” says Philip Mattera, director of a watchdog group called the Corporate Research Project.
Wal-Mart was counting on that subsidy.
Subsidy Creep
As a reporter I’ve covered local government since the mid-1980s. Time after time I’ve watched as Wal-Mart and its developers rode into rural and suburban cities and towns with their hands out and came away with their pockets stuffed with tax breaks and subsidies, often with little or no opposition. Back in the 1980s, the major concern of local governments, small business owners and (to a lesser extent) local residents was whether Wal-Mart would drive local mom and pop shops out of business. (The answer turned out to be an unqualified Yes.) But even then, standing in the way of “progress” and free-market competition (competition in which one side was given taxpayer-funded subsidies and everyone else was not) was considered futile, if not downright un-American. Stand in the way of progress you get runned over. Today, those concerns are moot. Wal-Mart can boast “mission accomplished.”
Then as now the tax break of choice for Wal-Mart and its developers was tax increment financing. TIFs were originally established to encourage developers to invest in hopelessly blighted commercial areas. Blighted soon came to mean non-blighted. Call it subsidy creep.
Historically a few school officials and PTA moms groused when these TIFs were granted. Yet in all those countless city council meetings I attended, I never once heard a city official ask why one of the wealthiest corporations in the world couldn’t build its discount stores and parking lots without withholding tax dollars from local schools, fire departments, libraries and other public services.
The simple answer was that nobody asked them to. When it came to subsidies and tax breaks Wal-Mart’s motto seemed to be: It doesn’t hurt to ask. All they can do is say no. And then we threaten to move to the next town.
Those threats were real. If a town even considered turning down a TIF request, a neighboring jurisdiction would immediately begin courting the Waltons. The practice became so widespread the Missouri legislature was forced to pass a reform law in 2007 to address this type of “retail pilfering.” In Missouri, TIFs are now granted only on a county-wide basis.
Changing Times
Now, three decades later, Wal-Mart and its developers find themselves having to work harder to obtain the same subsidies and tax breaks they once received by default. Cities and towns – even municipalities like Florissant, the majority of whose residents really want a Wal-Mart Supercenter – are beginning to stand up to the retail giant and its sidekick THF Realty. Indeed, across the Midwest – Wal-Mart’s home turf – more and more cities are saying they’ve had enough of Wal-Mart’s bullying.
My town did.
When Wal-Mart developers returned to Florissant in 2010 demanding tax breaks and threatening to walk away if they were denied, city officials happily showed developers the door.
That response was almost unprecedented outside of a few quaint New England hamlets. In fact, the neighboring city of Bridgeton, had just rubber stamped THF’s request for $8 million in TIF subsidies to build a Wal-Mart supercenter, no questions asked.
In voting 9-0 to deny the subsidy request, Florissant officials pointed out that a TIF district would divert $300,000 annually in property taxes from local schools, libraries, police, and fire departments to Kroenke’s THF Realty. Florissant’s mayor told reporters that Wal-Mart and its developer were “strong enough to pay with [their] own nickel.”
Even Missouri’s right-wing think tank, The Show-Me Institute, criticized Wal-Mart and Kroenke’s browbeating tactics. “You don’t need TIFs to attract retail development. With the right project and the right location, retail development will still come,” one policy analyst said.
So what changed?
First and foremost Americans have just been through the nation’s worst economic slump since The Great Depression. While average working Americans lost their homes and livelihoods, Wal-Mart got richer. Wal-Mart was one of the few stores to thrive during the U.S. recession, noted Forbes in March 2009.
What’s more, Americans wised up. In our total information society it is hard to remain deaf to the continual buzz of stories that spotlight the incredible wealth of the retailer (Wal-Mart Inc. is now wealthier than 157 nations.) When another St. Louis County municipality (Shrewsbury) rejected Wal-Mart’s request for a TIF in 2013, an alderwoman was quoted as saying, “The six Wal-Mart heirs alone have more wealth than the bottom 40 percent of the people in the United States!” This statement was met with loud applause.
At the same time as its phenomenal growth was taking place, Wal-Mart received hundreds of millions of dollars in corporate welfare (tax breaks, grants, low-cost financing, tax abatements and free land) from state and local governments. A new report by Americans for Tax Fairness concluded that Wal-Mart receives $6.2 billion a year in taxpayer subsidies. In a 2007 report, the nonprofit Good Jobs First noted that Wal-Mart’s developer THF Realty received at least $54 million in tax breaks from local governments for Wal-Mart stores between 1994 and 2006.
While Wal-Mart benefits enormously from corporate welfare, it has become adept at dodging local, state and federal taxes. The same report by ATF noted that Wal-Mart uses tax loopholes to avoid paying $1 billion of federal taxes a year. An example of this flimflammery showed up recently in a The Wall Street Journal story which showed how Wal-Mart evades some state taxes by paying rent to itself. Yes, these tax dodges are legal, though they are only available to the world’s richest corporations who can afford to hire the world’s slickest tax attorneys.
Equally damaging are the frequent stories that show Wal-Mart stiffing American taxpayers and its non-union employees. Low wages at a typical Wal-Mart Store cost taxpayers about $1 million in government assistance annually, according to a study by Democrats in the U.S. Committee on Education and the Workforce. Meanwhile the media is rife with stories of Wal-Mart employees who can’t afford to shop at Wal-Mart, who are forced to rely on food stamps, and who cannot afford to buy even the crappiest of cars to get to work. In October, Wal-Mart announced it would end health care benefits to a portion of its part-time employees.
And who can forget the story about Wal-Mart employees holding Thanksgiving food drives for their co-workers?
Plan B
After receiving an unexpected setback in Florissant, THF Realty redoubled its efforts in the fall of 2012. Plan B was to seek designation as a community improvement district. Missouri’s CID law, passed by the state legislature in 1998, was created to combat “community disinvestment and neighborhood decline” in inner-ring suburbs. (Florissant is an outer-ring suburb, but no matter.) In effect, community improvement districts bring improvements to small pockets of retail, while the rest of the town crumbles. And it is more likely to crumble since residents who are already paying higher sales taxes in these retail pockets will have less taste for a city-wide sales tax which would raise the standard of living for all residents.
The special taxing district would have permitted Wal-Mart to assess a one percent sales tax on store transactions. Just another way for Wal-Mart and THF to pass along the costs of construction to the middle and low-income folks who shop at their stores. Needless to say that revenue would not go to increase the wages of Wal-Mart workers.
Again, Florissant city leaders stuck to their guns, unanimously voting down the proposed CID.
Kroenke, however, still had his ace in the hole. He turned to the courts; not to sue the city of Florissant, but to file a petition in circuit court for the formation of a transportation development district.
The Missouri Transportation Development Act was passed by the Missouri Legislature in 1990 to address genuine transportation needs. Say, your town has grown by leaps and bounds and you desperately need a new overpass over the Interstate highway so emergency vehicles can get to the other side of town more quickly and thus save lives.
More often, however, a TDD is just another needless handout to billionaire developers.
With one rather remarkable difference. Unlike a TIF or CID, the public (or its elected representatives) have no say in the matter. Since St. Louis judges are appointed, the project is approved (TDDs are always approved) by an unelected judge. Taxpayers have no say whether sales taxes are imposed or what happens to their tax dollars or even whether the transportation projects are needed.
If approved, the THF’s transportation development district would have allowed a board handpicked by Kroenke to impose a sales tax on shoppers to help pay for roadwork that benefits his private property. What’s more, any money that Kroenke “loaned” to the project would be repaid with interest. If this TDD turned out like Kroenke’s other ventures, it would be overseen by a board made up of his rubber-stamping cronies. A board that meets and operates without any real oversight. “Read state auditors’ reports on special taxing districts, and you’ll see all kinds of reports of shoddy record keeping, self-dealing and much transparency in name only,” reports the Kansas City Business Journal.
Once again, working families would pay for Wal-Mart and the billionaire Kroenke’s street improvements through higher sales taxes.
At the hearing for what was now called the Shoppes at Cross Keyes Transportation Development District, Florissant’s city attorney informed the judge of Florissant officials’ unanimous objection to the transportation district. Nevertheless Circuit Judge Brenda Stith Loftin could find no legal reason not to approve the TDD. Moral reasons, yes. But legal, no.
The TDD was approved.
Beaten, the Florissant City Council approved zoning for the Wal-Mart. As one disgruntled city councilman told a St. Louis newspaper, “We sort of feel like they pulled an end-around.”
To many observers, Wal-Mart and their developer looked pathetic in their desperate craving for a corporate welfare fix. Wal-Mart and Kroenke didn’t seem to care what kind of Three-Letter Subsidy they wrangled (TIF, CID, TDD) as long as they got something from the taxpayers. Anything. Free landscaping. Free signage. Whatever.
Still it’s hard to blame Wal-Mart too much. Writing in Forbes, David Brunori notes that it’s wrong to fault corporations for behaving like giant, amoral machines acting in their own self-interest. “They act rationally,” he writes. “If someone gives you $1 billion, you take it. The blame lies with us.” In the end it is the fault of all of us for giving Wal-Mart’s lawyers the tools with which to defeat us.
There’s an old saying: You can’t beat City Hall. This is still true for 99 percent of Americans.
Just not for the One Percent.
Christopher Orlet is a journalist living in Florissant, Missouri.
Super-rich control $30tn of global wealth, equal to 40 percent of world GDP – study
RT | November 21, 2014
About 13 percent of global wealth of adults is concentrated in the hands of 0.004 percent of the population, according to a new study. And the trend is set to continue with the number of high net worth individuals reached a record 211,275 in 2014.
Swiss bank UBS and consulting firm Wealth-X compiled the World Ultra Wealth Report 2014 released Thursday.
“Ultra-high net worth” (UHNW) individuals are defined as people with a fortune of about $30 million. Of the 211,275 that fall into the category, 2,325 are billionaires, a 7.1 percent increase since last year. Experts believe the number of billionaires could rise to 4,000 by 2020.
“Even amidst geopolitical conflicts, socio-economic strife, and volatile currency markets, the world’s equity markets displayed strong performances, thereby enabling UHNW individuals’ wealth to increase and their influence across industries and sectors to grow — from their importance in wealth management to their consumption of luxury goods,” the report said.
The UHNW adult population account for approximately 1 in every 35,000 people in the world, or just 0.004 percent.
“Such a large concentration of wealth in the hands of these few individuals means that they tend to have a large degree of influence, whether on global equity markets or specific industries,” the report says
Average wealth of an UHNW individual has risen to $139.4 million, up $1.8 million last year.
The geographical heavyweight was again North America, which accounts for nearly a third of the total $30 trillion, at $9.7 trillion in held wealth. Europe is home to about 25 percent and Asia 23 percent.
Another major trend the report forecasts is that Asian wealth will overtake Europe in 2017. Currently Asia is home to 44,505 super-wealthy individuals with a combined fortune of $6.6 trillion, and Europe’s wealth stands at $7.7 trillion, shared between 58,065 people.
Latin America is the only region in 2014 to incur a fall, down 600 individuals and $75 billion.
Eighty-seven percent of the list is men, and more than two-thirds struck it rich on their own, 13 percent by inheritance, and the rest a combination.
Women, on the other hand, are more likely to become wealth via inheritance. Almost 50 percent got rich through inheritance, and one-third was “self-made.”
The average UHNW individual spends $1 million a year on luxury goods and services, the report says.
READ MORE: Number of billionaires hits new record high in 2014-report