Posts Tagged 'economics'

It’s 2003 and healthcare’s in crisis. Are workers and business in this together?

The following is a leaflet distributed at the American Public Health Association convention in the fall of 2003, six years ago.  It seems  pretty relevant today, given the current health reform legislation, with its emphasis on cost reduction for business and government, its incentives to make us pay more for less healthcare while securing sustained profits for insurers, drug companies and hospital chains, and its reliance on cuts to Medicare to fund the whole plan.


Obviously, healthcare is in crisis, but really there are two parallel health care crises.

For us, patients and providers, the health crisis is: 43 million uninsured, “patient driven” insurance that shifts costs to patients through high co-pays and inadequate benefits, a safety-net in tatters, a critical shortage of health workers, a hospital system rife with dangerous mistakes, and the worst health indicators in the industrialized world.  It’s clear to us that something must be done.

Business has a completely different health crisis: falling HMO and health insurance profits, rising and uncontrollable health costs, strikes and near-strikes over cuts in employee coverage, millions of ageing baby boomers with expensive diseases on the horizon, an uncertain recovery, huge federal and state budget deficits, and costly open-ended war ahead.  From their viewpoint, too, something must be done.

We need high-quality, comprehensive, single-tier, universal, government-financed healthcare.  Business needs to lower its operating costs as much as possible. We believe these are conflicting imperatives, which do not point to the same solutions.

Obviously, a huge segment of the corporate world wants to keep health insurance and high-priced drugs as part of the health delivery system because it’s a profitable commodity.  That sector is busy planning multi-tier “universal health coverage” where the uninsured get vouchers to buy new stripped-down health plans that could be profitable.  This plan was advocated in a recent NY Times Op-Ed piece (11-18-03), a SF Chronicle interview with Kaiser’s CEO (11-16-03), and is a plan proposed by California Blue Shield, which has hired hundreds of workers to handle anticipated new policy holders.

But what about the rest of the corporate world, businesses whose profits are reduced by bloated healthcare profits?  Could they help get single payer?  Some single-payer advocates say cracks are forming in the wall of corporate resistance. High costs and strikes are making some think twice about single payer. There are even policy-makers who worry that the dominance of the health and drug industries weakens the manufacturing sector, which could compromise national defense in time of major war.  Does all this make those businesses our ally?

We think not. For this sector of the economy, workers’ healthcare is a cost of doing business, like maintaining the machinery. Business will try to reduce health costs whether they are paid as direct benefits or as taxes under single payer.  They certainly have tried to reduce other tax-supported health programs like Medicare and Medicaid.  It should not stretch the imagination to foresee how business could turn the intense centralization of universal single-payer health care to their own advantage, and make it a mechanism for severe rationing of healthcare.  For example, the stripped-down “basic coverage” schemes that the insurance industry is presently designing for the uninsured will require standardization and government approval.  Once that happens, business will push to have “basic coverage” be the standard for patients under single payer.

For years, business hasn’t given a damn about people not having medical insurance.  Since the early 1980s they’ve laid tens of millions of us off, cut millions of current workers and retirees off medical benefits, and made their coverage so expensive that millions cannot afford it even when it is offered.  So you’ve got to suspect something is fishy when they start being so concerned about whether we have medical insurance.  We saw what happened when they were concerned with seniors not having prescription coverage.  They bundled in a plan to dismantle Medicare!

Our healthcare should be neither a commodity nor a cost of doing business.  This is a period of tremendous collision of people’s needs and aspirations versus corporate needs and demands.  The movement to end this disgraceful situation will involve a tremendous fight.   As Quentin Young said, getting good healthcare will be as big a struggle as civil rights.   Civil rights, Medicare, and Medicaid were all won by people who worked, their families, and people who would have worked if they could.  Their actions on the job, in their schools, organizations, churches, in the streets, and in the military challenged the US’s ability to govern and made the government produce the “Great Society” programs.  Although many of these gains have been erased in the intervening forty years, millions of lives were improved and the struggle remains as an inspiration and example of what is needed for deep reform of society.

We deserve nothing less than high-quality, comprehensive, single-tier, universal,  government-financed healthcare.  We have to be clear on what it will take to get it and who our allies are.

Concerned members of APHA


The Economic Crisis Ends; The Political Crisis Begins

In Ireland, “More than $4 billion in cuts…will slash salaries for 400,000 government workers while making painful reductions in benefits for such groups as widows and single mothers to the blind and disabled children.” Unemployment benefits were also slashed by as much as 30%.”

“The U.S. government, like the U.K. government, the Greeks and the Irish, is going to need to draw down fiscal stimulus, pare expenditures [make cuts], raise revenues [taxes] and probably take a look at [cuts] in their entitlement programs” — Social Security, Medicare, Education, etc.

Countercurrents, December 29, 2009

The Economic Crisis Ends; The Political Crisis Begins

By Shamus Cooke

First Iceland, then Ireland, now Greece. Much of Europe is mired in inescapable debt and bankrupt nations, the result of crashing banks, bank bailouts, and soaring unemployment. The U.S. and U.K. watch from a distance, knowing their turn is next.

The European corporate-elite — like their American counterparts — lavished non-stop praise on the “bold yet necessary” decision to bail out the banks; the economy was supposedly saved from “impending collapse.” But every action has an equal but opposite reaction. Bailing out the banks saved the butts of dozens of European bankers, but now millions of workers are about to experience a thundering kick in the ass.

Unbeknownst to most Europeans, the public money that financed the bank bailouts created a massive public debt problem, to be solved by massively slashing public programs that benefit workers and the poor. This amounts to a blatant transfer of billions — maybe trillions of dollars — in public wealth, away from the majority of citizens toward a parasitic crust of bankers.

These “tough decisions” should act as warnings to the American working class, since the U.S. corporate-elite, too, has clear-cut plans for who is to pay for their colossal spending spree on bank giveaways and foreign wars (hint: it’s not them).

The massive amounts of government bonds printed to pay for the global bank bailouts were purchased by global investors (capitalists). For these vultures, government bonds are an excellent investment when the economy crashes, and gambling on stocks turns sour. Now, these investors want to be sure that the heavily indebted governments are able to pay up. And they’re becoming impatient.

A good peek into the mind of the global investor can be seen in any of the three global “credit ratings agencies” — Moody’s, Standard and Poor’s, and Fitch. These corporations give “grades” to debtors — federal governments, corporations, state and city governments, etc. — based on their “credit worthiness.” To have one’s grade lowered means that investors should back off and demand higher interest rates on loans, if loans are made at all. Receiving a “B” instead of an “A” can make the difference between a poor nation being able to build a highway, hospital, or school.

Recently, Moody’s released their notorious “misery index” — the nations that are most sunken in debt and least able to pay it back, requiring that “special measures” be taken to prove to investors that these governments are able to repay their loans. The biggest losers of the misery index were not surprises and included the above-mentioned European countries. However, ranking right behind bankrupt Iceland was the United States: the once-proud super-power is now a debt-ridden carcass, with investor vultures circling overhead.

Moody’s is warning rich investors to be wary of formerly rich countries defaulting on their loans, i.e., going bankrupt. Moody’s chief of rating nations’ credit, Pierre Cailleteau, explains why:

“This is mainly because of the crisis of public finances [bank bailouts plus unemployment] that has beset many rich countries in what Moody’s believes will be the final — and disturbingly long-lasting — stage of the crisis.” This is what passes for optimism nowadays.

Moody’s is demanding that less-rich nations like Greece, Ireland, Spain, etc., take immediate actions to make their rich investors happy. The Washington Post explains Ireland’s situation:

“More than $4 billion in cuts…will slash salaries for 400,000 government workers while making painful reductions in benefits for such groups as widows and single mothers to the blind and disabled children.” Unemployment benefits were also slashed by as much as 30%.” (December 22, 2009).

The U.S. and the U.K. need not make immediate cuts, but they must make immediate plans to make major cuts, explains Moody’s spokesmen Cailleteau:

“…this will be the year [2010] where both the U.S. government and the U.K. government will have to articulate a credible plan to address their problems of large debt.”

John Chambers of Standard & Poor’s was more blunt:

“The U.S. government, like the U.K. government, the Greeks and the Irish, is going to need to draw down fiscal stimulus, pare expenditures [make cuts], raise revenues [taxes] and probably take a look at [cuts] in their entitlement programs” — Social Security, Medicare, Education, etc.

This is not news to President Obama. While he was extending the Bush bank bailouts, Obama took time to calm the nerves of investors, who saw an exploding debt that would soon need to be dealt with. That is why Obama pledged to the Washington Post that he would “reform entitlement programs.” (January 16, 2009). This was to be done after the economy had stabilized.

It’s almost time.

The mainstream media will surely go on the offensive to support our corporate-owned President in his assault on the social programs long cherished by the American working class. We will be told that there are “no other options,” when in fact there are.

Not only could military spending be reduced by hundreds of billions of dollars per year, but taxes should be raised significantly for the very wealthy. If the top 1 percent of the richest Americans were taxed at 90 percent, hundreds of millions of Americans would benefit, since public education would be saved, alongside Medicare and Social Security.

Barack Obama will soon be pursuing a policy that George Bush Jr. would never dare try. He must be resisted at every step. American unions should look to Europe for inspiration for how to deal with the coming onslaught: mass demonstrations and united strike action will be the only way to put sufficient pressure on a government enforcing a solidly right-wing corporate agenda. The political instability that is currently engulfing Europe is soon to be exported to the United States — we must not be caught off-guard.

The issue of the day is clear: somebody must be made to pay for the economic crisis. The corporate-elite is planning to push this burden on to the working class. The working class must push back. Unions and community organizations should begin organizing now in anticipation, with demands to tax the rich and corporations, and to save Social Security, Medicare, and public education.

Shamus Cooke is a social service worker, trade unionist, and writer for Workers Action ( He can be reached at

Shortlink to this post:

Mass Firings, The New Face of Immigration Raids

The Progressive, December 2009/January 2010


By David Bacon

LOS ANGELES, CA  (12/10/09) — Ana Contreras would have been a competitor for the national tai kwon do championship team this year. She’s 14.  For six years she’s gone to practice instead of birthday parties, giving up the friendships most teenagers live for. Then two months ago disaster struck.  Her mother Dolores lost her job.  The money for classes was gone, and not just that. “I only bought clothes for her once a year, when my tax refund check came,” Dolores Contreras explains.  “Now she needs shoes, and I had to tell her we didn’t have any money.  I stopped the cable and the internet she needs for school.  When my cell phone contract is up next month, I’ll stop that too.  I’ve never had enough money for a car, and now we’ve gone three months without paying the light bill.”

Contreras shares her misery with eighteen hundred other families. All lost their jobs when their employer, American Apparel, fired them for lacking immigration status.  {Her name was changed for this article.]  She still has her letter from the Department of Homeland Security (DHS), handed her two months ago by the company lawyer.  It says the documents she provided when she was hired are no good, and without work authorization, her work life is over.

Of course, it’s not really over.   Contreras still has to keep working if she and her daughter are to eat and pay rent.  So instead of a job that barely paid her bills, she had to find another one that won’t even do that.

Contreras is a skilled sewing machine operator.  She came to the U.S. thirteen years ago, after working many years in the garment factories of Tehuacan, Puebla.  There companies like Levis make so many pairs of stonewashed jeans that the town’s water has turned blue.  In Los Angeles, Contreras hoped to find the money to send home for her sister’s weekly dialysis treatments, and to pay the living and school expenses for four other siblings.  For five years she moved from shop to shop.  Like most garment workers, she didn’t get paid for overtime, her paychecks were often short, and sometimes her employer disappeared overnight, owing weeks in back pay.

Finally Contreras got a job at American Apparel, famous for its sexy clothing, made in Los Angeles instead of overseas.  She still had to work like a demon.  Her team of ten experienced seamstresses turned out 30 dozen tee shirts an hour.  After dividing the piece rate evenly among them, she’d come home with $400 for a 4-day week, after taxes. She paid Social Security too, although she’ll never see a dime in benefits because her contributions were credited to an invented number.

Now Contreras’s working again in a sweatshop at half what she earned before.  Meanwhile, American Apparel is replacing those who were fired.  Contreras says they’re mostly older women with documents, who can’t work as fast.  “Maybe they sew 10 dozen a day apiece,” she claims.  “The only operators with papers are the older ones.  Younger, faster workers either have no papers, or if they have them, they find better-paying jobs doing something easier.

“President Obama is responsible for putting us in this situation,” she charges angrily.  “This is worse than an immigration raid.  They want to keep us from working at all.”

Contreras may be angry, but she’s not wrong.  The White House website says “President Obama will remove incentives to enter the country illegally by preventing employers from hiring undocumented workers and enforcing the law.”  On June 24 he told Congress members that the government was “cracking down on employers who are using illegal workers in order to drive down wages — and oftentimes mistreat those workers.”

The law Obama is enforcing is the 1986 Immigration Reform and Control Act, which requires employers to keep records of workers’ immigration status, and prohibits them from hiring those who have no legal documents, or “work authorization.”  In effect, the law made it a crime for undocumented immigrants to work.  This provision, employer sanctions, is the legal basis for all the workplace immigration raids and enforcement of the last 23 years.  “Sanctions pretend to punish employers,” says Bill Ong Hing, law professor at the University of California at Davis.  “In reality, they punish workers.”

The Immigration and Customs Enforcement (ICE) division of DHS said early this year that it was auditing the records of 654 companies nationwide.  The audit at American Apparel actually began in 2007, under President Bush.  In Minneapolis, another Bush-era audit examined the records of janitors employed by American Building Maintenance.  In May, the company and ICE told 1200 workers that if they didn’t provide new documents that showed that they could legally work, they’d be fired. Weekly firings in groups of 300 began in October.  The janitors belong to Service Employees Local 26, and work at union wages.  The terminations took place as the union was negotiating a new contract. In Los Angeles 254 workers at Overhill Farms were fired in May.  The company, with over 800 employees, was audited by the Internal Revenue Service earlier this year.  According to John Grant, packinghouse division director for Local 770 of the United Food and Commercial Workers, which represents production employees at the food processing plant, “they found discrepancies in the Social Security numbers of many workers.  Overhill then sent a letter on April 6 to 254 people– all members of our union – giving them 30 days to reconcile their numbers.”

On May 2 the company stopped the production lines and sent everyone home, saying, according to worker Isela Hernandez, “there would be no work until they called us to come back.”  For 254 people that call never came.  According to Alex Auerbach, spokesperson for Overhill Farms, “the company was required by federal law to terminate these employees because they had invalid Social Security numbers.  To do otherwise would have exposed both the employees and the company to criminal and civil prosecution.”   “We asked to see the IRS letter or any other documents related to this,” Grant responds.  “We’ve never heard of the IRS demanding the termination of a worker. They never showed us any letter.  The company doesn’t have to terminate these people.  No document we know of says they do.”  Some of the terminated workers actually had valid Social Security numbers, and were fired anyway.

Workers accuse the company of hiring replacements, classified as “part timers,” who don’t receive the benefits in the union contract. “By getting rid of the regular workers, to whom they have to pay benefits, they’re saving a lot of money,” worker Lucia Vasquez charges.  Auerbach says the replacements are paid at the same rate, although he acknowledges they lack benefits.

The history of workplace immigration enforcement is filled with examples of employers who use audits and discrepancies as pretexts to discharge union militants or discourage worker organization.  The 16- year union drive at the Smithfield pork plant in North Carolina, for instance, saw two raids, and the firing of 300 workers for bad Social Security numbers.

Nevertheless, whether or not they’re motivated by economic gain or anti-union animus, the current firings highlight larger questions of immigration enforcement policy.  “These workers have not only done nothing wrong, they’ve spent years making the company rich. No one ever called company profits illegal, or says they should give them back to the workers.  So why are the workers called illegal?” asks Nativo Lopez, director of the Hermandad Mexicana Latinoamericana.  The Hermandad, with roots in Los Angeles’ immigrant rights movement going back to legendary activist Bert Corona, has organized protests against the firings at Overhill Farms and American Apparel.  “Any immigration policy that says these workers have no right to work and feed their families is wrong and needs to be changed,” he declares.

President Obama says sanctions enforcement targets employers “who are using illegal workers in order to drive down wages — and oftentimes mistreat those workers.”  This restates a common Bush administration rationale for workplace raids.  Former ICE Director Julie Meyers asserted that she was targeting “unscrupulous criminals who use illegal workers to cut costs and gain a competitive advantage.”  An ICE Worksite Enforcement Advisory claims “unscrupulous employers are likely to pay illegal workers substandard wages or force them to endure intolerable working conditions.”

Curing intolerable conditions by firing or deporting the workers who endure them doesn’t help the workers or change the conditions, however.  But that’s not who ICE targets anyway.  Workers at Smithfield were trying to organize a union to improve conditions. Overhill Farms has a union.  American Apparel pays better than most garment factories.  In Minneapolis, the 1200 fired janitors at ABM get a higher wage than non-union workers – and they had to strike to win it.

ICE’s campaign of audits and firings, which SEIU Local 26 president Javier Murillo calls “the Obama enforcement policy,” targets the same set of employers the Bush raids went after – union companies or those with organizing drives.  If anything, ICE seems intent on punishing undocumented workers who earn too much, or who become too visible by demanding higher wages and organizing unions.   And despite Obama’s notion that sanctions enforcement will punish those employers who exploit immigrants, at American Apparel and ABM the employers were rewarded for cooperation by being immunized from prosecution.  ICE threatened to fine Dov Charney, American Apparel’s owner, but then withdrew the threat, according to attorney Peter Schey.  Murillo says, “the promise made during the audit is that if the company cooperates and complies, they won’t be fined.  So this policy really only hurts workers.”

And the justification for hurting workers is also implicit in the policy announced on the White House site:  “remove incentives to enter the country illegally.”  This was the original justification for employer sanctions in 1986 – if migrants can’t work, they won’t come. Of course, people did come, because at the same time Congress passed the Immigration Reform and Control Act, it also began debate on the North American Free Trade Agreement.  That virtually guaranteed future migration.  Since NAFTA went into effect in 1994, over six million Mexicans, like Dolores Contreras, have been driven by poverty across the border.  “The real questions we need to ask are what uproots people in Mexico,” Hing says, “and why U.S. employers rely so heavily on low-wage workers.”

No one in the Obama or Bush administrations, or the Clinton administration before them, wants to stop migration to the U.S. or imagines that this could be done without catastrophic consequences. The very industries they target for enforcement are so dependent on the labor of migrants they would collapse without it.  Instead, immigration policy and enforcement consigns those migrants to an “illegal” status, and undermines the price of their labor. Enforcement is a means for managing the flow of migrants, and making their labor available to employers at a price they want to pay.

In 1998, the Clinton administration mounted the largest sanctions enforcement action to date, in which agents sifted through the names of 24,310 workers in 40 Nebraska meatpacking plants.  They then sent letters to 4,762 people, saying their documents were bad, and over 3500 were forced from their jobs.  Mark Reed, who directed “Operation Vanguard,” claimed it was really intended to pressure Congress and employer groups to support guest worker legislation.  “We depend on foreign labor,” he declared. “If we don’t have illegal immigration anymore, we’ll have the political support for guest workers.”

Bush’s DHS Secretary Michael Chertoff said the same thing. “There’s an obvious solution to the problem of illegal work, which is you open the front door and you shut the back door.”   “Opening the front door” allows employers to recruit workers to come to the U.S., giving them visas that tie their ability to stay to their employment. And to force workers to come through this system, “closing the back door” criminalizes migrants who work without “work authorization.”  As Arizona governor, DHS Secretary Janet Napolitano supported this arrangement, signing the state’s own draconian employer sanctions bill, while supporting guest worker programs.

In its final proposal to “shut the back door,” the Bush administration announced a regulation requiring employers to fire any worker whose Social Security number didn’t match SSA’s database. Social Security no-match letters don’t currently require employers to fire workers with mismatched numbers, although employers have nevertheless used them to terminate thousands of people.  Bush would have made such terminations mandatory.

Unions, the ACLU and the National Immigration Law Center got an injunction to stop the rule’s implementation in the summer of 2008, arguing it would harm citizens and legal residents who might be victims of clerical mistakes.  In October 2009, the Obama administration decided not to contest the injunction.  But while dropping Bush’s regulation, DHS announced it would beef up the use of the E-Verify electronic database, arguing that it’s more efficient in targeting the undocumented.

Social Security, however, continues to send no-match letters to employers, and the E-Verify database is compiled, in part, by sifting through Social Security numbers, looking for mismatches.  DHS Secretary Janet Napolitano called on employers to screen new hires using E-Verify, and said those who do so will be entitled to put a special logo on their products stating “I E-Verify.”

John T. Morton, DHS assistant secretary for ICE, told the New York Times in November that the 654 companies audited in 2008 and early 2009 were just a beginning, and that audits would be expanded to an additional 1000 companies.  “All manner of companies face the very real possibility that the government … is going to come knocking on the door,” he warned.  The original 654 audits, Morton said, had already led to action at 328 employers, which presumably will include a demand to fire workers identified as undocumented.

This growing wave of firings is provoking sharp debate in unions, especially those with large immigrant memberships.  Many of the food processing workers at Overhill Farms and ABM’s janitors have been dues- paying members for years.  They expect the union to defend them when the company fires them for lack of status.  “The union should try to stop people from losing their jobs,” demanded Erlinda Silerio, an Overhill Farms worker.  “It should try to get the company to hire us back, and pay compensation for the time we’ve been out.”

At American Apparel, although there was no union, some workers had actively tried to form one in past years.  Jose Covarrubias got a job as a cleaner when the garment union was helping them organize.  “I’d worked with the International Ladies’ Garment Workers and the Garment Workers Center before,” he recalls, “in sweatshops where we sued the owners when they disappeared without paying us.  When I got to American Apparel I joined right away.  I debated with the non-union workers, trying to convince them the union would defend us.”

The twelve million undocumented people in the U.S., spread in factories, fields and construction sites throughout the country, encompass lots of workers like Covarrubias.  Many are aware of their rights and anxious to improve their lives.  National union organizing campaigns, like Justice for Janitors and Hotel Workers Rising, depend on the determination and activism of these immigrants, documented and undocumented alike.

That reality finally convinced the AFL-CIO in 1999 to reject the federation’s former support for employer sanctions, and call for repeal.  Unions recognized that sanctions enforcement makes it much more difficult for workers to defend their rights, organize unions, and raise wages.

Opposing sanctions, however, puts labor in opposition to the current administration, which it helped elect.  Some Washington DC lobbying groups have decided to support the administration policy of sanctions enforcement instead.  One of them, Reform Immigration for America, says, “any employment verification system should determine employment authorization accurately and efficiently.”  Verification of authorization is exactly what happened at American Apparel and ABM, and inevitably leads to firings.  The AFL-CIO and the Change to Win labor federation this spring also agreed on a new immigration position that supports a “secure and effective worker authorization mechanism …one that determines employment authorization accurately while providing maximum protection for workers.”

Covarrubias is left defenseless by such protection, however. Instead, he says, “we need the unity of workers.  There are 15 million people in the AFL-CIO.  They have a lot of economic and political power.  Why don’t they oppose these firings and defend us?” he asks. “We’ve contributed to this movement for 20 years, and we’re not leaving.  We’re going to stay and fight for a more just immigration reform.”

Nativo Lopez says he’ll organize the workers being fired if unions won’t, although recently he also expressed a desire for greater cooperation with the UFCW in the defense of fired workers.  Last year the Hermandad began setting up workers’ councils in southern California neighborhoods, to oppose employer sanctions and help workers resist them.  “If companies start firing people as they have here, this place will look like a war zone,” he warns, “but if we fight to defend people, we can organize them.”

For more articles and images, see

For a Press TV interview about racism, globalization and illegality,


See also Illegal People — How Globalization Creates Migration and

Criminalizes Immigrants  (Beacon Press, 2008)

Recipient: C.L.R. James Award, best book of 2007-2008

See also the photodocumentary on indigenous migration to the US

Communities Without Borders (Cornell University/ILR Press, 2006)

See also The Children of NAFTA, Labor Wars on the U.S./Mexico Border

(University of California, 2004)


David Bacon, Photographs and Stories

shortlink for this post:



RSS Gray Panthers in the News

  • An error has occurred; the feed is probably down. Try again later.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 590 other followers


%d bloggers like this: