Media clips
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Sure, Davidoff is right that sky-high CEO pay deserves a broader look across the board. After all, it’s a big driver of income inequality. As the Economic Policy Institute has found, “Executives, and workers in finance, accounted for 58 percent of the expansion of income for the top 1 percent and 67 percent of the increase in income for the top 0.1 percent from 1979 to 2005.” Not only that, but taxpayers are subsidizing these big pay packages thanks to a loophole allowing corporations to write off CEO pay that is “performance based.” (Rep. Lloyd Doggett, D-Texas, has introduced legislation to fix that particular problem, but given what the Republican-held House is interested in these days, I wouldn’t expect it to come up for a vote anytime soon.)
US News and World Report February 21, 2014 -
Since then, according to Doug Hall, director of the Economic Analysis and Research Network at the Economic Policy Institute, other economists have done similar studies at the state and county level when a minimum wage change makes labor more expensive in one jurisdiction than in a neighboring one.
The chart above shows the results of more than 1,400 different studies. The x-axis shows the size of the employment effect, and the y-axis shows that statistical power of the analysis.
The Fiscal Times February 21, 2014 -
Economist at the Economic Policy Institute Heidi Shierholz says that despite projecting job loss, the CBO’s latest report on the minimum wage hike also shows how lower wage workers will
The Hill February 21, 2014 -
On Thursday afternoon, the faculty senate will review this proposal to tie the president’s salary to that of the school’s lowest-paid employees. Such workers at the public liberal arts college currently make$24,500 a year, which would translate into a $245,000 salary cap for the president — roughly $80,000 less than Ian Newbould, the college’s interim president, presently makes.
The move comes at a time of budget difficulties for the college, which lost roughly $3.5 million in expected tuition this academic year when it failed to fill enrollment numbers for its freshman class. It also comes at a time when higher-ed costs are ballooning across the United States and when executive pay is under increased scrutiny. This fall, the Securities and Exchange Commission voted to propose a rule requiring companies to disclose the ratio of CEO pay compared to their median worker’s. In 2012, according to the Economic Policy Institute, that ratio was 273-1.
The Washington Post February 21, 2014 -
The United Auto Workers’ failure to organize the employees at Volkswagen’s plant in Chattanooga, Tenn., has been greeted with predictable hosannas from the sworn enemies of American unions. Survey their celebratory columns, though, and you won’t find the slightest consideration of most Americans’ primary economic problem: How do workers get a raise in today’s economy? With the rate of unionization so low that even unionized employees have trouble winning good contracts, how can workers profit from the gains in their productivity? What will it take for workers to regain the power to reap what they sow?
In recent decades, they’ve reaped precious little. Between 1947 and 1973 — roughly the one period of union strength in U.S. history — productivity increased by 97 percent and workers’ compensation (that’s wages plus benefits) by 95 percent. Since 1973, however, as unions have weakened, productivity has increased by 80 percent and compensation by just 11 percent, according to the Economic Policy Institute.
The Washington Post February 21, 2014 -
But that’s all water under the bridge. The important point is that U.S. fiscal policy went completely in the wrong direction after 2010. With the stimulus perceived as a failure, job creation almost disappeared from inside-the-Beltway discourse, replaced with obsessive concern over budget deficits. Government spending, which had been temporarily boosted both by the Recovery Act and by safety-net programs like food stamps and unemployment benefits, began falling, with public investment hit worst. And this anti-stimulus has destroyed millions of jobs.
The New York Times February 21, 2014 -
A new non-partisan report has set off a storm of dueling arguments over the perennially testy question of raising the minimum hourly wage.
The proposal, by Democrats, to raise the minimum wage to $10.10 per hour would bring some 900,000 families above the poverty line and boost the income of an additional 16.5 million workers, but any such pay increase could also cost the jobs of as many as 500,000 workers, an analysis by the Congressional Budget Office found.
Almost as soon as the report was released Tuesday, opponents began to cite the report in an effort to torpedo any Congressional vote to hike the federal minimum from $7.25 per hour to $10.10 by 2016.
CNNMoney February 21, 2014 -
Further, some teens need to work to help earn their way through college. When jobs become scarce, education can become inaccessible, said Heidi Shierholz, an economist at the Economic Policy Institute, a Washington research group funded in part by labor unions.
“Teen jobs matter a lot less if you go to college, but having a work history may be the difference between putting yourself through school or not,” she said.
Carnevale, former chairman of the National Commission on Employment Policy, said as entry-level jobs have become higher-skilled and harder for teens to get, it has most disadvantaged those in lower-income households.
“It’s a Catch-22: You can’t get the job because you don’t have the skills, and if you can’t get the job, you can’t get the skills,” he said. “The work experience issue gets more and more severe as you move down the income distribution.”
Bloomberg Politics February 20, 2014 -
Wal-Mart has a total of 1.3 million U.S. employees. About 300,000 of those employees earn an average of $8.75 an hour, according to Berkeley’s Labor Research Center. Boosting the federal minimum to $10.10 an hour from the current $7.25, which is the proposal from President Obama and Senate Democrats, could have a big impact just from the store’s own employees.
Some economists are on board with the idea. “If suddenly all these low-wage workers have more income, they are likely to spend that money right away,” David Cooper of the left-leaning Economic Policy Institute told The Huffington Post last fall. “If an employee at McDonald’s or Pizza Hut suddenly has additional income,” he said, “they could spend it at Walmart.”
National Journal February 20, 2014 -
It’s a two-part problem. First, there is opportunity hoarding at the top, wherein the wealthy invest heavily in their children’s education and job prospects, while also passing their wealth on to their children. Then there is stagnation at the bottom, caused largely by reverse trends, economic and racial segregation, awful schools, and poor parents without much money to invest in children.
Why does the “land of opportunity” have such low mobility? Laissez-faire economic policies—massive tax breaks, untrammeled free markets, unregulated free trade, deep cuts to the safety net—have widened the income gap. While Republicans have tried to sever the link between mobility and inequality, research shows that the two issues are intimately connected: Societies and communities with high inequality have low levels of upward mobility. Josh Bivens of the Economic Policy Institute estimates that had income growth risen proportionally between 1979 and 2007, the median income would be $19,000 higher.
The New Republic February 20, 2014