On Tuesday, October 7, 2008 at 5:30 pm Jonathan Hiatt, the General Council for the AFL-CIO will address a small group of labor lawyers, unionists and law students about this critical election and what comes after November 4. Mr Hiatt will discuss topics such as the Employee Free Choice Act, the election, immigration and the Wall Street credit problems.

This event is a great place to mingle with leaders in the field of law, politics and labor. The event which is hosted by Councilwoman Maria Quinones-Sanchez will be in the City Hall Caucus Room, Room #400. Snacks and refreshments will be served. Tickets are $50 but call for low-income and student tickets that as affordable as $20. Space is extremely limited so be sure to reserve your ticket today by calling Fabricio at Jobs with Justice at 215-670-5855. A portion of the proceeds from this event will go to support Jobs with Justice.

So the public demand should not be for passage of a "good" bailout bill. It should be for a halt to this rush to passage of any bill. The demand should be for "No Bill Without Hearings!"

So call Congress (202-225-3121, 202-224-3121 or 800-828-0498) and tell your representative and your two senators that you don't want them railroaded. Tell them you demand hearings before legislation. And tell them, again, that you will vote against anyone who votes for the current bailout for Wall Street. (Hint: If you can't get through, then call one of their local offices, which are listed in the blue pages of your phonebook, or go visit a local office.)

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http://phillyimc.org/en/node/75584

By Philly writer Dave Lindorff

(reprinted with permission)

In his new essay, Philly writer Dave Lindorff (thiscantbehappening.net) writes an excellent article about the proposed Wall Street bailout, and the power of our resistance to it.

--And also enjoy this classic Rage Against the Machine / Michael Moore video.

Read the full article here: http://phillyimc.org/en/node/75344

The Power of "No"!

By Dave Lindorff

In June, there were 43,600 people officially unemployed in Philadelphia County. At 7% the unemployment rate in Philadelphia is now a full percentage point higher than in June of last year. As the U.S. economy goes so goes Philadelphia’s economy so the news that U.S. growth in GDP during the 2nd quarter came in slower than expected despite the economic stimulus is a worrisome development.

On Tuesday, the Federal Open Market Committee (FOMC) of the U.S. Federal Reserve will meet to set the federal funds rate. One of the current voting members of the FOMC is Charles Plosser the President of the Philadelphia Federal Reserve.

Plosser has called for the FOMC to “act preemptively” and begin raising the federal funds rate to slow the economy because he is concerned about containing inflation.

He believes that inflation is already too high and fears that unless the FOMC acts to raise unemployment further, wages will begin to rise in response to recent spikes in food and energy prices. Rising wages would in turn set off a new round of price increases and lead to a wage-price spiral.

There is one huge problem with Plosser's view, there is no evidence that wages are beginning to accelerate, to the contrary wages in recent months are growing more slowly which is precisely what you would expect when employment is falling. It is important to remember that wages are sticky and therefore don’t quickly adjust to current labor market conditions so Plosser could be worried that recent spikes in food and energy prices will show up in wages a year from now. But here again the problem is that an economic expansion just ended in which wages and incomes for all but the wealthiest failed to keep pace with the growth in prices. Indeed in the last two and half decades the only time there has been sustained and broadly shared wage growth was when unemployment rates reached historic lows in the late 1990s.

In a recent speech Plosser responded to this kind of criticism with the following argument:

“In recent months I have heard some analysts suggest that the current economic situation is not like the 1970s because unions are less prevalent and there is no evidence as yet of a wage-price spiral. Thus, a weak economy, with rising unemployment and declining payroll employment, will presumably prevent workers from demanding higher wages. But, again, that story has things backwards. It is not demands for higher wages that kick off the spiral, but the loss of confidence that the central bank will keep inflation controlled, which, in turn, leads to a rise in inflation expectations. The wage-price spiral is not the cause of the inflation, but the result. This means that if monetary policymakers wait until they see the evidence of a wage-price spiral, they will be too late — the public will have lost confidence in the Fed’s ability to keep inflation under control, and this will make the job of bringing inflation down much more costly and difficult.”

As Paul Krugman has explained Plosser is of the view that wage growth is influenced by the growth in consumer prices. So in his view if the central bank signals it will do nothing about rising prices, workers will demand from their employers wage increases that match or beat the rise in inflation which is the first step in a wage-price spiral.

The alternative view is that wage growth is shaped by trends in the labor market. This means that spikes in commodity prices will not translate into rising wages. It is of note that most workers nationwide and in Philadelphia have lost ground against inflation not in just the last six months but in the last six years.

Of course this is not an academic exercise, Plosser is aggressively advocating taking steps that would slow the economy and push unemployment higher in Philadelphia. He is doing this even as most economic indicators are signaling a worsening rather than improving economic situation.

Is it too much to ask that such a policy stance require more than a gut feeling? There is no evidence that inflation in food and energy prices has begun to seep into other prices in the economy. The economic and social costs of unemployment especially in a city like Philadelphia are substantial and should have significantly more weight than the fear that inflation might–someday–maybe–perhaps accelerate.

--Mark Price

Hello,

I am sorry to say, that society is falling apart. You may already know that and feel that now. I say society is falling apart due to purely economic reasons, because it is true. As you know, I am also becoming an economist. Simply put if the people have less economic means, then society will not be able to function normally, as it should. The private economies are doing well, but the overall society is not.

Let me give you some background. In 1971, America went off the gold standard. The Bretton Woods Agreement terms changed. In that US dollars would no longer be backed by gold or silver, for that matter. From that point, America and other nations, could “print” money at will. A reason why we had such high inflation, or “stagflation” in the 1970s. Again we are having high inflation now.

With the national economy showing signs of a recession now would be a good time to review the employment situation in the Philadelphia region.

What if this is as good as it gets?

Wednesday new figures on employment in the region were released by the Bureau of Labor Statistics. Payroll employment in January increased over the same month a year ago by 11,000 jobs or .6%. Employment growth in January lies somewhat below a post-2001 recession peak of 1.5% achieved in the summer of 2005.

This is Ida May Fuller. From the Social Security website:

Miss Fuller (known as Aunt Ida to her friends and family) was born on September 6, 1874 on a farm outside of Ludlow, Vermont...Ida May never married and had no children. She lived alone most of her life, but spent eight years near the end of her life living with her niece, Hazel Perkins, and her family in Brattleboro, Vermont.

Miss Fuller filed her retirement claim on November 4, 1939, having worked under Social Security for a little short of three years. While running an errand she dropped by the Rutland Social Security office to ask about possible benefits. She would later observe: "It wasn't that I expected anything, mind you, but I knew I'd been paying for something called Social Security and I wanted to ask the people in Rutland about it."

On January 31, 1940, Ida May Fuller was the first person in the US to get a Social Security check. Sure, there are problems with Social Security today, but imagine voting for Roosevelt in 1932, seeing him pass the Social Security Act in 1935, and getting a check that helped you retire--a previously unheard of federal benefit by 1940. That sure would make me want to keep voting...

The New Deal was by no means perfect (our leftist equivalents in the 30’s saw it as a major compromise) but at least the Democrats and Roosevelt did something to respond to the Great Depression, and address the injustices caused by the the excesses of 1920’s corporations.

Can we expect the same today? (woo-hoo! The Fed is suggesting a rate cut--that'll solve all of our problems!)

Even though Democrats today have managed to regain power in the US Congress, the real accomplishment of the Republicans was not their 30 year majority rule, but the slow devolution of federal power to the states they achieved while in control. The result is that we are more reliant on the kooks in Harrisburg than ever before. And it's a lot harder for cities to go to the Feds for big pots of money to solve local problems.

What’s my point?

• The Presidential election is very important, but the Democrat we elect next November can only do so much to address Philadelphia’s problems: violence, wage loss, net population loss, a weak education system, and environmental assault.
  
  
• City Council and Mayor Nutter can tinker around the edges—-there is a lot to do there—-but at some point, they have to dive in to the big issues, and the biggest among them is generational poverty and a shrinking middle class.

These are familiar themes of course, but as we move into the first 100 days of the Nutter Administration and the new City Council, I’d love to see the new leaders of the city lay out a New Deal for Philadelphia--in writing, in detail.

I want to be able to post a picture her in the next few years of a woman, like Ida May Fuller, who gets something from city government she never expected before like an affordable housing unit paid for by expiring ten-year tax abatements, or a free education at Community College, or a decent-wage job, or free after-school for her kids.

There's been a lot of talk about hope the past few weeks, and this is my greatest hope. That’s not too much to ask is it?

Doron Taussig and Tom Namako at the City Paper put together a cover story (as of last Thursday) that takes the form of a to-do list addressed to Mayoral presumptive Michael Nutter. Great minds think a like apparently as their article hit some of the same marks as my post about the future of Philadelphia’s economy and Michael Nutter.

One point they hit that really seems worth emphasizing is the renegotiation of city worker contracts that will occur next spring. The lines have already been drawn in that battle: the city will not have a whole lot of money to spend on all its needs and city workers don’t want to make any more concessions on health care.

The CP article describes the coming conflict efficiently:

Within five years, the city of Philadelphia will be spending more than one of every four of its tax dollars on what used to be called 'fringe benefits'" — pensions and health care. You can't afford to maintain this rate, and if you don't win some concessions, your hands will be tied by budgetary constraints for your entire first term. But the unions have said they don't intend to accept any benefit cuts — good bennies are practically the point of a public-sector job — and the last thing you want in your first half-year is a public-sector strike that shuts down the city you promised to make work better. The situation is so dire that it's been compared to what Gov. Ed Rendell faced when he first took office, when Philly was on the verge of bankruptcy...One other thing worth mentioning here: Philadelphia's public-sector employees' generous health and pension plans are not necessarily a bad thing. The City of Philadelphia is the biggest employer in the city of Philadelphia. It behooves you to keep 27,778 public employees and 33,500 retirees comfortable.

The authors go on to list a number of other important priorities including violence, addressing prison overcrowding, SEPTA, DHS, ethics, and of course tax cuts:

There are two changes to the city's tax structure that you've backed. One was reducing the business-privilege tax (BPT), a move you tried to make while on council until Street vetoed it. The other is reassessing property taxes, so that properties are assessed according to what they would sell for if a For Sale sign went up today, rather than decades ago.

Now that you're mayor, it would appear that these proposals' time has come. But two things could stand in their way: those upcoming union negotiations, and City Council. There's only so much money the city has to spend every year, and this year, the unions get a shot at it first. If they persuade you to spend more money on them, says tax advocate Brett Mandel, it might be hard to cut business taxes....Passing the BPT cuts, at least, seems doable: It takes nine votes to pass a bill, and eight of the members who voted in favor of cutting the BPT in 2004 remain on council. That means you need to persuade just one of possibly four new council members: Bill Green, Maria Quinones-Sanchez, Curtis Jones or (maybe) David Oh to back the idea. Take them to dinner, compliment their outfits, give them some money for area recreation centers — you remember how this is done, right?

I am somewhat biased in this conversation as I now dating a city worker (well, I have always been dating him, but Joel just became a Library trainee). Aside from the income he brings into our household, his job is important to me because it provides me with healthcare (yea domestic partnership!). I gotta tell you, I really don’t want him to lose his job. And I think you all know how I feel about business tax cuts.

Looking at the situation objectively though, and I guess this is what is what I was trying to articulate in my earlier post about Nutter and the economy, the contract fight is a great opportunity to dissect our collective priorities for the expenditure of city funds.

Do we as citizens and voters support job and benefit cuts for city workers if the money saved will go toward something that enhances our economy and creates a net gain of jobs? Is that really the choice that will be presented to us? What value and services do we as citizens get from city workers?

Messing with the livelihood of the largest pool of employees in the city is a BIG deal. Seems to me like we as a general populace need some tools to better understand what is going on.

As the CP article points out, and as many folks here have pointed out, Michael Nutter has a lot of problems to deal with when he becomes Mayor, and he won’t be able to address them all right away. In that context it is up to us to set expectations accordingly and begin to articulate which things are most important to deal with first, and be able to explain why.

That starts with identifying the issues that will be forced to the forefront (probably this one and and gun violence would be my guess) and all of us (on and offline) listing our priorities beyond those.

There was a lively exchange here over personal and social responsibility. While I don’t wish to diminish the importance of these issues in developing social policy it is often lost in these conversations that many of the consequences of the breakdown in both personal and social responsibility often fall upon the shoulders of children.

Today a series of reports on the well being of children and youth in Philadelphia’s neighborhoods were released by Philadelphia Safe and Sound. Here are links to the first three of the eleven planned reports, Bridesburg/Kensignton/Richmond , Lower North Philadelphia and West Philadelphia.

I am going to vote for Michael Nutter on November 6th, and he is going to win.

Despite the fact that he is not really a candidate anymore, and he already has my support, I do want to know more about how he thinks about the economic problems facing Philadelphia.

I have written about the future of Philadelphia’s economy here, here, here, and here and Nutter has demonstrated an intelligent response to many of the issues brought up in those conversations, He also comes to the General Election with the most equally balanced base of support in terms of race, ever.

However, no matter how good he is, or how good a job he does, or who supports him, his first few months in office will be challenging and I want to know what he is going to do to create a sustainable, local economy that benefits all of us.

Why?

Our city’s economy is in the midst of a major change that so far seems to be making quality of life worse for most of us. Our city has been through change before (think fight for independence, industrial revolution, the Great Depression, deindustrialization in the 1970s). In the past, the sheer size of these moments made it difficult for a local Mayor to do more than just react. However, the economic and cultural shifts we are experiencing now are different. An economy rooted in innovation, creativity, and service delivery (as opposed to industry, manufacturing, and concrete material products) is inherently more micro and local. Aided by the devolution of the role of federal government, there’s more power and responsibility in the hands of states and cities than ever before.

This big-pciture stuff has a particular and specific impact on us--young workers in Philadelphia. We are facing a really uncertain personal economic future. In the context of this very big framework, acknowledging Philadelphia itself can only do so much, I am curious to learn what Nutter will do, and more importantly how he thinks.

A few weeks back I wrote a post called “Back to Philadelphia’s Economic Future” that tries to describe what I am seeing emerge. I described an era in our nation and our world’s economic growth thathas yet to be named, but is characterized by increasing income inequity and poverty, rising violence. There I prescribed the formation of a plan for Philadelphia’s economy to help us navigate our way through this difficult era. I envisioned a detailed plan that could take advantage of the changes in our economy via local innovation, to take us to a new place of shared prosperity and increased opportunity. I talked to Dan about this in advance of my writing and he said:

I am not really a big fan of some huge master plan, because when you look back on master plans that cities have had before, they are really laughable in how stupid they are, or how out of time. I think what you are more talking about anyway is more like what I would consider a framework with a set of specific goals and outcomes.

Good point. Our economy and our city are too dynamic to make a plan that we must adhere to, but a framework, as Dan suggests, makes a lot of sense.

For instance, if you can prove to me that opening a new condo building with retail stores on the bottom will raise median wages, I’d support it. However, if you can show me that an investment in a green building trades apprentice program will ultimately raise median wages higher, than I’d rather prioritize that.

A framework (PHramework maybe?)—which might just start from a list of goals and ideas that are already out on the table—would help build a road map for local government practitioners to consult when they make any decision about municipal funding. If you are pushing green building, or increased CHIP funding, or affordable housing, or tax breaks, it should be obvious how any request to spend (or reduce the intake of revenue in the case of tax cuts) municipal funds will directly help to raise median wages or the reduce poverty.

What elements of a framework for Philadelphia's economic future can we all agree to?

Click "read more" below to see some ideas.