Friday, November 30, 2012

Today in Labor History—November 30

November 30, 1830 – Agricultural laborers rioted at Shaftesbury, Dorset, in England, to win the release of five imprisoned comrades. Simultaneously, in Banwell, Somerset, paupers rioted at the poorhouse, then launched an attack on the prison, releasing its prisoners. (From the Daily Bleed)

November 30, 1854 - "Fighting Mary" Eliza McDowell was born on this date. In 1902, McDowell helped organize the first women's local union of the Amalgamated Meat Cutters, which was made up mostly of the low-paid women working in packinghouse canning and labeling operations. (FromWorkday Minnesota)

November 30, 1930 – Mother Jones died, age 100, Silver Spring, Maryland. Jones was an organizer or "walking delegate" for the United Mine Workers (UMW), famous for her bravado. When she and 3,000 women were released by a militia after being held all night in McAdoo, Pennsylvania, they marched straight to the hotel housing the soldiers and ate their breakfast. Even well into her 90s, she still roamed through the hills of West Virginia, encouraging miners to organize. (From the Daily Bleed)
Dorothy Day, 1916 

November 30, 1980 –Anarchist, pacifist, and co-founder of the Catholic Worker movement, Dorothy Day, died on this date in New York City.  (From theDaily Bleed)

Thursday, November 29, 2012

Today in Labor History—November 29

November 29, 1832 - Louisa May Alcott, author, nurse and abolitionist, was born on this date. While she was most famous for her book, “Little Women,” Alcott also wrote “Work,” an autobiographical novel that exposed the exploitation of women workers. (From Workday Minnesota)

November 29, 1870 – England initiated state-run compulsory education.(From the Daily Bleed)

November 29, 1934 – Retail workers at Boston Stores in Milwaukee launched a strike at the beginning of the Christmas rush. The strike was a united effort between three unions, including clerks, teamsters & building-service employees. An extremely cold winter and the store's willingness to hold out through the holiday season eventually broke the strike. For the next 60 years, none of the city's major department stores were unionized. (From theDaily Bleed)

November 29, 1999 - Thousands of activists, students, union members, environmentalists and others shut down the World Trade Organization (WTO) summit in Seattle. It was the first large-scale demonstration in the United States to protest the “corporate agenda” and “globalization” and the beginning of many similar protests, including the current OWS movement. The WTO protest, like the OWS movement, was effective at raising awareness of corporate greed while simultaneously promoting the delusion that, with a few reforms, capitalism and democracy would serve the needs of the people. (From Workday Minnesota)

Wednesday, November 28, 2012

UC’s Secret Lover. . . Wall Street . . . Students and Employees Get Screwed

Huck/Konopacki Labor Cartoons

California voters recently approved Proposition 30, which would temporarily raise taxes slightly on the wealthiest state residents while also imposing a regressive sales tax hike on the poorest residents. The measure is expected to help close California’s current $16 billion deficit, but not to restore the tens of billions in revenues that have been slashed over the past few years.

I recently wrote that despite the increased revenues from Prop 30, both of the state’s major university systems (CSU and UC) will be increasing fees and tuition for some students. In the case of UC, tuition for certain graduate programs could increase as much as 35%.

It is not simply that Prop 30 doesn’t come close to restoring pre-recession funding levels. It doesn’t. There is a deeper, institutional problem that Prop 30 merely covers up and plays into: The tax system and the political system are both designed to maximize the profits and bolster the economic interests of the employing class. Consider that Prop 30 did not touch capital gains, inheritance, corporate or property taxes. It did nothing to bring oil royalties up to the fairly low rates charged by Texas and Alaska. It essentially left the filthy rich filthy rich and the moderately rich still comfortably rich.

Even some of the increased revenues from Prop 30 that are earmarked for education will go directly into the hands of Wall Street bankers, rather than toward tuition reductions, increased course offerings or raises for professors. According to a recent report by UC Berkeley researchers, the UC Board of regents has made risky deals with Wall Street banks over the past decade known as interest rate swaps. They supposedly did this as a hedge against rising interest rates on variable rate bonds, but the swaps turned out to be a losing bet because interest rates dropped in the wake of the 2008 financial meltdown and have remained low since then.

These swap deals have already cost UC almost $57 million, according to the San Francisco Chronicle. However, another $200 million in losses are anticipated over the next 30 years (the university is currently paying Wall Street close to $750,000 per month according to the Nation). UC is expected to receive $250 million from Prop 30, which is not even enough to cover its Wall Street debts, let alone provide any financial relief for its students or employees.  Nevertheless, the university plans on spending $10 million a year from Prop 30 to service its Wall Street debt, leaving little for tuition relief, increased course offerings, student services or wage increases for employees. Tuition has tripled over the past few years, while salaries for professors and other employees have remained stagnant. Indeed, the regents are warning of more cuts and tuition increases, despite Prop 30, including a 24% across-the-board tuition hike over the next four years.

One might reasonably wonder how the regents made such a blunder. After all, it is well known among gamblers that, in the end, the House always comes out on top. But this wasn’t simply a matter of some naïve regents making a bad gamble. Rather, the regents ARE Wall Street insiders. They not only knew exactly what they were doing, but likely did it to enrich themselves and their cronies at the expense of taxpayers, students and employees. For example, the regent’s chief financial officer, Peter Taylor, came from Lehman Bros, where he had been managing director for public finance at a time when Lehman Bros. had been hired to help expand UC's debt load. Taylor continued to work for Lehman Bros while he was a regent. UC’s interest rate swap with Lehman ultimately cost the university over $23 million.

Similarly, UC Regent Monica Lozano has earned $1.5 million serving on the Board of Bank of America at the same time the university negotiated interest rate swaps with BofA worth a potential $28 million in profits to the bank. UC Executive Vice President Nathan Brostrom—a former managing director for public finance at JP Morgan—worked on financing for UC at a time when his former company was hired as a bond broker and swap counterparty for the UC Davis Medical Center, a deal in which the university ultimately lost $22.5 million. And UC Regent Russell Gould, who chaired the finance committee from 2008 to 2009 and the full board from 2009 to 2010, was receiving a salary from Wachovia/Wells Fargo from 1996 to 2009. (The regents’ biographies have been excerpted from the UC report)

The UC Berkeley report notes that the university obtained the interest rate swaps in order to finance the development of medical centers on three of its campuses (UCLA, UCD and UCSF). Since the medical centers are money-making enterprises for the university and since student tuition was used as collateral for the interest rate swaps, there was a financial incentive for the regents to jack up tuition. However, the university never had a chance to win on its gambles as the interest rate swaps were all based on rates determined by
LIBOR, rates that were rigged in one of the largest banking scandals in history. (BofA is one of the banks currently under investigation in the LIBOR scandal).

Some have argued that the swaps made sense at the time and that the regents, despite the conflict of interest, had the university’s best interests in mind. However, if this was true, one might expect them to re-negotiate their loans or sue the banks, as have many other large institutions that have been screwed by similar deals. So far, they have made no indication that either plan is in the works. On the contrary, some regents are arguing that the swaps are still good deals, since the bonds don’t mature until 2047.

Meanwhile, the university will continue to transfer three quarters of a million dollars per month from the taxpayers to Wall Street banks to service their loans, thus keeping the bankers comfortable and their employees and students ever more stretched.

Today in Labor History—November 28

November 28, 1891 - The International Brotherhood of Electrical Workers was founded on this date. The IBEW currently represents approximately 750,000 members in utilities, construction, telecommunications, broadcasting, manufacturing, railroads and government. (From Workday Minnesota)

November 28, 1944 – 400 people in Rotterdam attacked a coal warehouse. The Nazis executed 40 Dutch men in retaliation. (From the Daily Bleed)

November 28, 1953 – A photoengravers strike shut down New York City’s newspapers for 11 days. (From the Daily Bleed)

November 28, 1994 – In the wake of years of outsourcing and downsizing, Bell-Atlantic announced another 5,600 lay-offs. In response, 1,200 employees in Pennsylvania came to work in T-shirts that portrayed themselves as road kill on the information superhighway. Management suspended them all without pay when they refused to remove the shirts. (From the Daily Bleed)

Tuesday, November 27, 2012

America’s Class War Against Youth

Huck/Konopacki Labor Cartoons

If the Occupy Wall Street (OWS) movement accomplished anything it was to focus public anger on America’s extreme and growing wealth gap, portraying it as the product of the greed and selfishness of the richest 1%.

This overly simplistic view obscures the actual socioeconomic relationships that are responsible for the transfer of wealth from the majority to the few, as well as who comprises this “few.”

The wealth gap is actually the by-product and goal of capitalism and the sociopolitical institutions that bolster it. All bosses in private businesses, regardless of how rich they may be, make their profits by paying their employees less than the value of their labor and pocketing this surplus value as profits (i.e., exploitation). The owner and employer classes transfer additional wealth to themselves through a taxation system that allows them to pay a lower effective tax rate than their employees pay, and through a legislative and legal system that facilitates their acquisition of more capital, sometimes even if it injures, sickens or kills others.

Exploitation of workers is the primary source of the wealth gap, particularly between employers and employees and the source of the so-called obscene wealth we see among the “1%.” However, wealth is also transferred from the young to the old, resulting in a growing wealth gap between older Americans and the young.

The wealth gap between younger and older Americans is currently the widest on record. In 1984 Americans who were sixty-five and over made ten times as much as those under the age of thirty-five. By 2008, older Americans were earning nearly forty-seven times as much as the younger age group. (For more, see the following articles in Esquire and Newsweek).

This wealth gap is not small, either. The median net worth of households headed by someone 65 or older has increased 42% since 1984, to a comfortable $170,494, while the median net worth for younger households has declined 68% to a desperate $3,662, according to the Pew Research Center.

The Pew study attributes some of the wealth transfer to timing: The older generation benefited from living and working in a strong economy and a long rise in housing prices. Conversely, older Americans have suffered far less under the current recession, with the median net worth of those under 35 falling 37% between 2005 and 2010, while falling only 13% for those over the age of 65. The recession has also forced many older Americans to continue working longer than they would have in the past, squeezing many younger workers out of jobs. The percentage of the workforce under the age of 25 has declined 13.2% since 2008, while rising 7.6% for those over 55.

However, the trend began decades before the current recession and has been facilitated by changes in government policy, which have been promoted by an aging politician class (today’s Congress is the oldest since World War II). For example, the federal government now spends $480 billion on Medicare, but only $68 billion on education, according to the Esquire article. As a whole, the U.S. government spends 7 times as much on its seniors as it does on its children, per capita, according to a 2009 Brookings Institution study. Mike Males writes that younger workers are currently contributing 15% of their payroll income to pay for Social Security and Medicare payments for seniors, since Congress gutted the Social Security Trust Fund (originally designed to cover future generation’s benefits) to pay for current government needs.

The transfer of wealth from young to old has been a hallmark of the Republican Party and would have been taken to new extremes under the Ryan tax plan. According to Males, younger Americans would have suffered under this plan in direct proportion to how young they are. Virtually every federal program designed to benefit the young and the poor would have been gutted or eliminated, including food stamps, Medicaid and job training. Federal spending on education would have been slashed by one-third. But Social Security and Medicare for today’s seniors would have been preserved. At the same time, median-income households headed by people 55-65 would have received tax breaks of roughly $1,200, while median-income households headed by people under 25 would have lost hundreds of dollars.

However, the Democrats have also contributed to the generational wealth transfer. Under Obama’s 2012 budget, for example, Medicare and Social Security were left alone, while the Adolescent Family Life Program and the Career Pathways Innovation Fund were ended. Likewise, the AmeriCorps program was slashed and had to turn away 75% of applicants last year, while recent changes to the Pell grant program will cost students an estimated $100 billion over the next ten years, according to the Esquire article. Similarly, Obama’s plan for avoiding the “fiscal cliff” involves raising the age of eligibility for Medicare benefits and cutting benefits for future recipients of Medicare and Social Security. In other words, the benefits of today’s seniors would be preserved and subsidized on the backs of today’s youth.

So far I have only discussed the tangible, present-day ways younger Americans have been screwed. They have also been saddled with an enormous debt they will be paying well into the future through higher taxes, reduced benefits and services, and delayed retirement (or no retirement). The per capita debt in the U.S. is now $50,000, with much of it going toward paying for the longest wars in U.S. history (i.e., Iraq and Afghanistan) and huge tax breaks for the wealthy. Yet, the average student also owes $12,700 to the credit card companies and will owe $27,000 to college loans creditors, according to the Newsweek article. And despite incurring all this debt, college graduates’ income has dropped 11% over the last decade for men and 7.6% for women.

While some of this wealth transfer has merely helped middle class baby boomers live comfortable middle class retirements, much of it is really about helping banks, Wall Street investors, and large businesses reap ever larger profits on the backs of youths. Skyrocketing student debt, for example, contributes to the poverty of younger Americans. Yet, Obama’s student debt repayment plan may actually increase debt payments for many students, while his plan to cut spending on higher education by $10 billion could increase student need for loans, thus increasing profits for lenders and the hedge funds that trade students loans.

Today in Labor History—November 27

November 27, 1937 – The ILGWU-commissioned the kitschy musical "Pins & Needles" opened on Broadway, with a cast made up entirely of International Lady Garment Worker Union members. Rehearsals were held at night and on weekends, and performances were all on Fridays and Saturdays to appease their bosses (i.e., keep their jobs). In 1962, a 25th anniversary edition of the score was released featuring Barbra Streisand. (From Workday Minnesota)

Monday, November 26, 2012

California’s Wimpy Students

For the second year in a row, California students have tested poorly on statewide physical fitness tests. Only 31% of students received healthy scores in all six of the areas tested areas, according to state schools Chief Tom Torlakson. Scores had been steadily rising for years and then started to drop two years ago. (For more, see the following article in the Los Angeles Times)

Today in Labor History—November 26

November 26, 1868 – Ignoring orders to kill only warriors, an Army contingent led by General Custer massacred 103 Cheyenne in their sleep — during the "Battle of the Washita," Oklahoma Territory. (From the Daily Bleed)

November 26, 1883 – Emancipationist and former slave Sojourner Truth died on this date in Battle Creek, Michigan. (From the Daily Bleed)

November 26, 1911 -- Paul Lafargue, son-in-law of Karl Marx, died on this date. Lafargue wrote “The Right to Be Lazy” in 1893 while in prison. (From theDaily Bleed)

Sunday, November 25, 2012

Today in Labor History—November 25

America, Love It or Leave It (By Force)
November 25, 1919 – A strike for union recognition by 395,000 steelworkers continued throughout November. The strike began on September 22 and collapsed on January 8, 1920. The strike was used by the feds as an excuse to deport approximately 250 anarchists, communists and labor agitators to Russia on November 24, marking the beginning of the so-called "Red Scare." (from the Daily Bleed)

November 25, 1946 - St. Paul teachers, led mostly by women, walked out of their classrooms in American’s first organized teachers’ strike. 1,165 teachers and principals (all represented by the same union) remained out until Dec. 27 in what they called the “strike for better schools.” (From Workday Minnesota)

Saturday, November 24, 2012

Today in Labor History—November 24

Future Slayer of God, Charles Darwin, Age 7
November 24, 1859 -- Charles Darwin's Origin of the Species was published. (From the Daily Bleed)

November 24, 1875 - The Cigar Makers International Union, Local 144, was chartered with Samuel Gompers as president. (From Workday Minnesota)
Mollie Steimer c1918 (public domain)
 November 24, 1921 – Mollie Steimer, after doing 18 months for handing out leaflets, was shipped off to Soviet Russia along with three other radicals (Jacob Abrams, Samuel Lipman, & Hyman Lachowsky). In the U.S., they were victims of the Red Scare, for handing out leaflets opposing the deployment of U.S. troops against Soviet Russia. However, they were also soon victims of the Red Terror in Russia. Steimer was deported from the USSR in 1923 for aiding “criminal elements.” (From the Daily Bleed)

November 24, 1927 – On Thanksgiving Day 1927, California troops battled 1,200 inmates when Folsom prisoners revolted. One prisoner was shot and five others were later hanged. (From the Daily Bleed)

November 24, 1947 –Chicago newspaper printers' strike began in opposition to the recently passed anti-labor Taft-Hartley Act. (From the Daily Bleed)

Friday, November 23, 2012

Today in Labor History—November 23

Francois-Noel Babeuf (public domain)
November 23, 1760 – French revolutionary Francois-Noel Babeuf was born on this date in St. Quentin, France. Babeuf was a communist leader in the French Revolution and a member of the Conspiracy of Equals (along with Jacque Roux and Jean Varlet) until he was betrayed to the Directory, captured and executed. (From the Daily Bleed)

November 23, 1831 – The Silk Workers' Revolt in Lyon continued, with workers occupying the Town Hall and an insurrectionary government was formed. (From the Daily Bleed)
Western Federation of Miners Poster (public domain)
 November 23, 1903 – Army troops were sent to Cripple Creek, Colorado to put down a rebellion by striking coal miners. 600 union members were thrown into a military bullpen, and held for weeks without charges. When a lawyer arrived with a writ of habeas corpus, General Bell, who led the repression, responded "Habeas corpus, hell! We'll give 'em post mortems!” (From theDaily Bleed)

November 23, 1935 - Mine Workers President John L. Lewis quit the American Federation of Labor to the lead the new Congress of Industrial Organizations, which was rapidly organizing workers in steel, auto, rubber and other major industries. (From Workday Minnesota)

Thursday, November 22, 2012

Data Driven Nonsense from Harvard and the Gates Foundation

A new Gates-funded Harvard study has found that Los Angeles Unified School District (LAUSD) teachers vary substantially in quality (more than in other districts) and that it disproportionately places inexperienced teachers in lower performing classrooms (as in other districts). The study, Human Capital Diagnostic, was done by the Strategic Data Project (SDP), which is connected with Harvard University’s Center for Education Policy Research.

The biggest problem with this study is that it is a bunch of nonsense.

Let’s start with the authors’ most profound claim: The best teachers in LAUSD provide the equivalent of eight additional months of instruction during the school year compared with the district’s worst teachers. Since their research was based entirely on student scores on the California Standards Tests (CSTs), a high-stakes exam used to rank schools, and the top teachers in the study were the ones with the largest student gains on these tests, what they are really saying is that the best teachers provided the equivalent of eight additional months of test prep.

Big wow!

The authors state that there is “no specific cut-off for determining whether an effect size is large or small,” but they assert that a standard deviation of 0.2 is considered large in education research. The study found that the difference between a 25th and a 75th percentile teacher is one-quarter of a standard deviation (0.25). This would be significant if it was based on a meaningful measurement of teacher effectiveness. Unfortunately, all it really says it that some teachers are better than others at squeezing out student gains on an otherwise lousy exam. It does not tell us whether their students are becoming self-motivated, independent learners or competent critical thinkers and problem-solvers. Furthermore, the study provided no explanation for how it determined that 0.25 standard deviations was equivalent to eight months of instruction.

The authors also claim that Teach for America (TFA) and Career Ladder teachers have higher effects on their students than other novice teachers by 0.05 and 0.03 standard deviations and they even attributed a gain of one to two months in additional learning to these relatively small standard deviations. They make similar claims for National Board Certified teachers, whose students test gains were 0.03-0.07 standard deviations higher than those of other teachers. Yet, if a standard deviation of 0.2 is considered large in education, then a standard deviation of 0.03-0.07 ought to be considered small or even insignificant.

While the standard deviation may be insignificant, the fact that this was being researched in the first place is not. TFA provided 13% of new hires to the district over the past six years (according to the study’s authors) and it would be of great interest to the district’s administrators to show that the investment was worthwhile. So let’s assume for the sake of argument that the difference between TFA recruits and other novice teachers was significant. What would this mean? TFA teachers may in fact be more willing than other novice teachers to work long, unpaid overtime hours and substitute quality student-centered instruction for “drill and kill” style teaching, both of which could produce higher test scores without improving the quality of student learning.

Perhaps a bigger problem with this study (like all studies and reforms based on student test data) is that numbers are not the only relevant type of data in education and sometimes not even the best. Ester Quintaro, writing for the Shanker Blog, talks about the “streetlight effect,” from the parable of the drunk who searches for his lost wallet under the streetlight, not because he lost it there, but because the light is better there and it would be easier to find it if it happened to be there. Student test data is easy to access now that it is required of every district in the U.S. under No Child Left Behind (NCLB)—it is under the streetlight.  Yet, at best it is only a proxy or very rough estimate of teacher quality since it only considers a small part of what teachers are expected to do.

Quintara also correctly points out that NCLB has helped to institutionalize what counts as data. “Scientifically-based research” is now limited to standardized test scores, which, as it turns out, are not particularly scientific. Case studies, ethnographies, teacher observations and portfolios, and other qualitative data are considered unacceptable.

One promising finding from the study was that teacher performance after two years was found to be a good predictor of future effectiveness. In other words, the current system of giving tenure to teachers after two years of good evaluations makes sense. Teachers are not getting worse after two years. Novice teachers are not better than veterans and should not have the right to bump them during layoffs and LAUSD is not top heavy with a bunch of cranky veterans who can no longer teach.

Today in Labor History—November 22

Live Free or Die Fighting, Canuts Uprising, Lyon Silk Strike, 1831 (public domain)
November 22, 1831 -- The revolt of the silk workers was continuing in Lyon, France. Workers seized arms and fought the military. Approximately 100 died, 69 of them civilians. 263 soldiers were wounded. (From the Daily Bleed)
In this book, Bernays Argued That The Manipulation of Public Opinion is a Necessary Part of Democracy
 November 22, 1891 -- Dr. Edward L. Bernays was born in Vienna, Austria. Bernay, a nephew of Freud, is considered by many to be father of public relations. He is also credited with getting women to smoke and helping United Fruit to overthrow Guatemalan President Arbenz. (From the Daily Bleed)

November 22, 1909 - The “Uprising of the 20,000,”occurred in New York, as female garment workers went struck for better pay and an end to sweatshop working conditions. 19-year-old Clara Lemlich, who led the strike, said she had no patience for talk and called for her coworkers to join in a General Strike. Their strike won some gains for workers, like a raise and a reduction in work hours to 52 hours per week, but did not end sweatshop conditions in the industry. During the strike, a Judge told arrested picketers,"You are on strike against God."

In the black of the winter of nineteen-nine
When we froze & bled on the picket line,
We showed the world that women could fight
& we rose & won with women's might.

Hail the waistmakers of nineteen-nine
Making their stand on the picket line,
Breaking the power of those who reign,
Pointing the way, smashing the chain.
 (From Workday Minnesota and the Daily Bleed)

Wednesday, November 21, 2012

Unions Collaborate With Obama to Squeeze American Workers

Image from Flickr, by DonkeyHotey

With the country moving ever closer to the “fiscal cliff,” the Obama Administration is doing everything it can to strike a “grand bargain” that appeases the ruling elite. The grand bargain is a euphemism for an austerity package that will maintain low taxes for the wealthy and subsidies for their business by slashing social spending and services that help keep the rest of the country from sinking further into poverty.

Union leaders met with the president on Tuesday to give their support for his plan which will include large cuts to social programs like Medicare, Medicaid, Social Security, food stamps and other welfare programs, the WSWS reported this week. Because there is broad support for most of these programs, the President is depending on the unions to help quell popular opposition and avert the kinds of protests and mass discontent seen in Greece, Spain, Portugal and the UK.

While the unions have claimed they are fighting to protect American workers from austerity, their actions indicate that their actual goal is to sell the president’s scam as a good deal for their members.  AFL-CIO President Richard Trumka, for example, said his organization was committed to making sure that the middle class and workers don’t end up “paying the tab for a party that we didn’t get to,” and he asserted that the president had the same commitment. Also present at the meeting were Mary Kay Henry, head of the Service Employees International Union (SEIU), Lee Saunders of the American Federation of State, County and Municipal Employees (AFSCME), and Dennis Van Roekel, president of the National Education Association (NEA). Mary Kay Henry said “We expect to have the president’s back on the agenda that the voters just declared support for. The president has always said he needs a movement behind his mandate.”

Unions Have President’s Back (As He Attacks the Middle and Working Classes)
In 2011 Obama proposed a deficit-reduction plan that would have raised the eligibility age for Medicare, cut Medicare benefits, reduced Social Security benefits, slashed Medicaid, and reduced tax deductions for the middle and working classes. According to the WSWS, William Daley (White House chief of staff when Obama first proposed this “grand bargain”) told Bloomberg News that this would be Obama’s starting point for the next round of negotiations with Republicans. To make matters worse, the extension on unemployment benefits will automatically expire on January 1, ending payments to over 2 million unemployed workers and Obama has said nothing about how (or if) he would avert this disaster.

The “bargain” in this Grand Bargain is Obama’s insistence that taxes must be raised on those earning more than $250,000 per year. However, he has indicated that he would be willing to consider other ways of increasing revenue from the wealthy, like maintaining current tax rates, but decreasing deductions. In either case, the rich earn most of their income through capital gains, which are taxed at the relatively low rate of 15%. Thus many, like Mitt Romney, end up paying a far lower effective rate than the majority of Americans (who earn most or all of their income through salaries) and will continue to do so even if Obama wins approval for tax increases on the wealthy.

Further evidence that Obama is planning austerity for the majority of Americans comes from a secret document leaked last week to Meet the Press. The document indicates that in 2011 Obama proposed over two dollars in cuts for every dollar in increased revenue ($2.8 trillion in cuts and $1.2 trillion in tax increases), setting the stage for raising the debt ceiling and the automatic spending cuts that comprise the “fiscal cliff.” The document revealed that Obama was willing to cut TRICARE (health insurance for the military and veterans) and to lower tax rates for business and for the wealthy. The document also suggested cutting Medicare by $250 billion between 2012 and 2021 and by $800 billion between 2022 and 2031. It proposed cutting Social Security payments by $112 billion over the next 10 years and cutting veterans’ disability payments by $24 billion. It also suggested slashing $11 billion from military retirement and $33 billion from benefits for retired federal employees, as well as $2 billion from nutrition assistance, $4 billion from flood insurance and $10 billion from higher education.

All this sounds exactly like an attempt to make American workers pay the tab for a party they didn’t attend. The Republicans have refused to sign off on any tax increases for the wealthy and Obama has indicated he would be willing to lower their tax liability. A few Republicans, like Mitch McConnell, have indicated they might accept a cap on deductions in exchange for cuts to entitlements (e.g., slashing Medicare and Social Security) and Obama has indicated he is open to this. In the end, the rich will sacrifice little or nothing toward closing the federal deficit, which will be subsidized almost entirely by reductions in services and programs that benefit the majority. Yet the deficit is almost entirely a byproduct of gifts to the wealthy, like subsidies to defense contractors, oil and coal companies, and big Agri-business; bailouts of banks; and tax breaks for the wealthy and their businesses.

Education Cuts for California Despite Prop 30 Victory

Image from Flickr, by Double-M

The California Teachers Association (CTA) lobbied heavily for passage of Proposition 30, mobilizing thousands of teachers to phone bank and canvas neighborhoods. Together with other state unions, they spent $50 million to get the initiative passed. They claimed it would save public education and restore funding to the schools. However, with more than $18 billion slashed from K-12 education since the recession began, the $6.6 billion in projected revenues from Prop 30 won’t even come close to restoring public education funding to pre-recession levels, especially considering the state budget deficit is now estimated at more than $15 billion. It will do nothing to bring back the 80,000 teaching jobs lost since the recession began nor reopen any schools that were shut down, the WSWS reports.

What Proposition 30 will do is prevent $6 billion in trigger cuts that had been built into the last state budget as a way to blackmail California voters into approving the tax hikes. Rather than restoring public education, Prop 30 simply maintains the status quo of an $18 billion hole in the state’s K-12 funding and one of the very lowest per pupil funding rates in the nation. While it does raise taxes on those making more than $250,000 per year, the increase is only a nominal 1-3% increase on their payroll taxes (i.e., the taxes withheld from their salaries) and it leaves the tax rate on their capital gains (which makes up the majority of their income) unaffected. At the same time, Prop 30 raises the state sales tax from 9.25% to 9.75%—a regressive tax increase that disproportionately affects poor and working class people.

While the California State University (CSU), University of California (UC) and state community college systems are all planning to increase course offerings and some, like CSU, are planning modest tuition refunds ($249 per semester, according to the Los Angeles Times), they are also planning other fee increases and service cuts. CSU, for example, is still planning to implement fee increases for students taking more classes than they need to graduate, and the UC system is planning on increasing fees for graduate and professional programs by 1.5% to 35%. UC, which threatened 20% tuition hikes if Prop 30 failed (and promised no new fees this year if it passed), is leaving open the possibility of raising undergraduate tuition again next year.

In response to the proposed cuts and the unwillingness of UC to go beyond a tuition freeze and actually lower tuition, UC students have been protesting at UC campuses and at meetings of the university’s regents. Students staged a sleep-out in Berkeley on Wednesday night. Hundreds of students were joined by faculty and unionized workers on Thursday to protest budget cuts that have resulted in slashed course offerings, layoffs and large tuition hikes. They blocked roads leading to the meetings and then disrupted the meeting so effectively that the regents had to call a temporary recess.

Students do not simply want a reduction in tuition—many want a completely subsidized higher education system. Last Friday, KPFA’s “Up Front” news program broadcast protesters chanting, “No cuts! No fees! Education must be free!” Until recently, California did subsidize both the UC and CSU systems to the point that neither charged tuition and both charged fees that were relatively affordable for middle income families. Back in the early- to mid-1980s, for example, it only cost $1,000-1,200 per year to attend UC. By 1995, it was over $4,000. By 2010, it has risen to more than $11,000. Last year, tuition at UC was $13,218. (Click here for more on the history of UC tuition).

With the passage of Prop 30, Los Angeles Unified (LAUSD) is planning on restoring the five school days that had been cut from the school year the Los Angeles Times reports, as well as restoring teacher pay for the 10 days which they had lost to furloughs. However, Superintendent Deasy warned of a new round of cuts (implying the furloughs and pay cuts could return) if Congress and President Obama cannot resolve the “fiscal cliff” crisis, as this would leave LAUSD with a new $60 million budget shortfall.

Of course, if this happens, many districts in the state could suddenly find themselves with large deficits, too. This is because Prop 30 is only a bandage over a gaping wound. Education at all levels, from pre-K to graduate school, has been eviscerated over the past decade and Prop 30 does nothing to restore the cuts. Prop 30 does little to close California’s current budget deficit and it does nothing to stabilize California’s revenue stream or prevent future deficits and education cuts.

There is a glimmer of hope for education funding in the future. One of the reasons California has had so much difficulty in balancing its budget for the past decade is that voters approved a law requiring a two-thirds supermajority in the legislature before any new tax increases can be approved. The most recent election, however, gave the Democrats just such a supermajority in both houses of the state legislature for the first time in nearly 80 years. This will not only allow lawmakers to pass tax increases, but it also gives them the power to override the Governor’s veto.

Whether or not they will use their power in this way remains to be seen, but seems unlikely considering that every one of them would be negatively affected by a serious tax increase on the wealthy. This is not only because they are all wealthy themselves, but because they would be biting the corporate hand that feeds them, keeps them in office, and provides them jobs when they get termed out.