ThinkProgress Logo

Economy

Indiana Company Rejects Gov. Mitch Daniels’ Claim That It Added Jobs Due To ‘Right-To-Work’ Law

Indiana Republicans ignored protests from labor groups and even National Football League players this winter and became the 23rd state to adopt a so-called “right-to-work” law. Despite having no evidence that the anti-union legislation would create jobs, Republicans claimed it would, and Gov. Mitch Daniels (R) signed it into law.

Less than two months after he signed the bill, Daniels is already touting its success. Daniels claims more than 30 companies have asked about moving to Indiana, but so far he’s only named one, MBC Group, that added Indiana jobs. Unfortunately for Daniels, it seems he jumped the gun:

The Indiana Economic Development Corporation issued a statement in which company president Eric Holloway said expanding its Brookville, Ind., site was a “no-brainer” because of right-to-work and other factors.

Holloway says he did not notice the reference to right to work when he approved the statement and says the law had no effect on his decision to expand.

Indiana, of course, has tried “right-to-work” once before, passing a similar law in 1957. The law was so unpopular that voters demolished Republicans at the polls in 1958, and Democrats repealed it in 1965.

The law is again unpopular — 71 percent supported an effort to put it up to a referendum vote on the November ballot — likely because studies are again showing that it is bad for workers and won’t actually help Indiana create jobs.

Sen. Kelly Ayotte: Goldman Whistleblower Proves We Should Have Let Detroit Go Bankrupt

Greg Smith’s New York Times op-ed yesterday — in which he announced his resignation from Goldman Sachs due to the firm’s “toxic and destructive” culture — has garnered lots of reactions. But one of the most curious came this morning from Sen. Kelly Ayotte (R-NH), who told MSNBC’s Chuck Todd that Smith’s op-ed highlights why the government should not have intervened to rescue the American auto industry:

TODD: When you read this op-ed were you getting angry?

AYOTTE: Well, I get angry when I think about bailouts. Bailouts not only for the private sector but also, obviously, for the car companies. I don’t think that’s the right direction for us. And that highlights it, I think that’s what part of the anger was from the Tea Party movement, but also just anger about what’s happening here in Washington with the fiscal state of this country.

Watch it:

For starters, does Ayotte think that the American auto companies were not part of the private sector when they received government aid? But more importantly, does she not recognize the difference between rescuing a vital American manufacturing industry and bailing out banks in order to save the financial system, only to see them go back to the same practices that caused the mess in the first place?

Ayotte’s bizarre connection aside, Smith’s op-ed actually makes the case for the Volcker rule, a restriction on risky trading that’s included in the Dodd-Frank law. The financial industry has been pounding away on the Volcker rule, in an attempt to render it meaningless, which would allow the banks to simply go right back to all the pernicious practices that helped bring the economy to the brink of collapse.

Justice

Grassley & Harkin Introduce Bipartisan Bill To Fix Supreme Court Assault On Older Workers

Nearly three years ago, the Supreme Court rolled back decades of precedent to make it harder for older workers to stand up to age discrimination in the workplace:

Employment discrimination cases are difficult to prove because the plaintiff ultimately must show what their boss was thinking at the time they were fired or demoted–it is illegal for an employer to fire a worker because they think the worker is too old or too black or too female, but not because they think the worker is incompetent or poorly dressed. Since workers don’t have ESP, the Supreme Court long ago put certain procedures in place to make sure that laws banning discrimination amount to more than just empty promises.

“Mixed motive” suits are an example of these procedures. To win a mixed motive case, a plaintiff had to prove that discrimination was one of the reasons behind their boss’ decision to fire or demote them. It was then up to their boss to prove that they would have made the same decision regardless of the worker’s race or gender or age. Workers are spared the nearly impossible task of having to prove that that their boss was thinking only of bigotry when they lashed out at their employee; and employers are given a fair chance to prove that discrimination is not the real reason why the worker was cast aside. . . .[Gross v. FBL Financial Services] eliminates such claims in age discrimination cases. Thanks to Justice Thomas’ majority opinion, victims of age discrimination are helpless unless they can get inside their boss’ head and show that their boss would have behaved differently if the victim had been a little younger.

A bill introduced Tuesday by Sens. Chuck Grassley (R-IA) and Tom Harkin (D-IA) will overturn Gross and restore to older workers the same ability to fight discrimination that they agreed before a 5-4 Supreme Court took it away from them. Although many Senate Democrats have long supported undoing the justices’ mischief in this way, this is the first time a Republican has signed on to the effort — Grassley’s endorsement of the bill is a hopeful sign that it could become law.

Enacting this bill is not simply important because it will restore necessary rights to older workers, it also is important to push back against a Supreme Court that openly flouts its own precedents. Justice Thomas’ majority opinion in Gross acknowledged that his decision was at war with longstanding precedent, but he dismissed this fact by simply saying “it is far from clear that the Court would have the same approach were it to consider the question today in the first instance.” In other words, Thomas believes that, because the Supreme Court is now dominated by five far right justices, it should no longer have to follow precedents from a more sensible era.

Education

Romney Finally Adds Education Platform To His Website, But His Positions Are Still A Mystery

Our guest blogger is Stephanie Frenel, an intern with the education policy team at the Center for American Progress Action Fund.

This week, after leaving everyone in the dark for months, Mitt Romney finally added an education section to his campaign website.

The fact that Romney is just releasing his platform on education now is troubling, considering how long he’s been on the campaign trail and how many primaries have already taken place. But more troubling is the clear lack of detail or depth to his plan, despite his adding high caliber advisers to his education team last week.

For example, compared to his healthcare and energy platforms, the new education section does not include any detailed objectives or goals. Furthermore, Romney claims that he will use the “best ideas from states that are succeeding and replicate them across the country,” but other than his own experiences in Massachusetts, he cites no examples of successful state practices and leaves readers to guess how his plan would affect current federal legislation.

The lack of detail in Romney’s plan is likely due to his hesitation to take any stance on education issues during the 2012 campaign, when conservatives have made attacking public education a habit. But as a reminder, Romney once supported federal programs like No Child Left Behind (NCLB). “So I supported No Child Left Behind. I still do. I know there are a lot in my party that don’t like it, but I like testing in our schools,” Romney said in 2007.

During the campaign, however, he has tried to have it both ways, criticizing his opponent Rick Santorum for supporting NCLB. “He talked of this of being ‘taking for one the team.’ I wonder which team he was taking it for. My team is the American people, not the insiders in Washington,” Romney said. At the same time, Romney has recruited several former Bush administration officials to advise him on education, including former Secretary of Education Margaret Spellings, a key implementer of NCLB.

Read more

NEWS FLASH

STUDY: NCAA Tournament To Cost Employers $175 Million In Lost Productivity This Week | The first two days of the NCAA men’s college basketball tournament will cost employers about $175 million in lost productivity as workers watch live-streamed games on their computers, TVs, or at home, according to a “conservative” new estimate from a Chicago-based firm. Overall, 32 total games will take place today and tomorrow, with the first starting just after noon and the last likely not ending until after midnight each day. More than 2.5 million Americans will watch the tournament online, while roughly 30 million will participate in bracket contests, the firm estimated. The first two weeks of the NCAA Tournament rank among the lowest for worker productivity each year, according to experts.

50 Years Ago Today, John F. Kennedy Called For Sweeping Consumer Protections

The United States established one of its first true consumer protection laws in 1872, when it protected consumers from fraud involving the use of U.S. mail. But the modern era of consumer protection didn’t begin for another 90 years, when President John F. Kennedy delivered remarks to Congress that established four basic consumer rights — rights to safety, to choice, to be informed, and to be heard — and laid the groundwork for the consumer protections Americans expect and depend upon today.

Kennedy’s remarks, delivered 50 years ago today, argued that protecting consumers was vital to the stability of the American economy and the country’s national interest:

If consumers are offered inferior products, if prices are exorbitant, if drugs are unsafe or worthless, if the consumer is unable to choose on an informed basis, then his dollar is wasted, his health and safety may be threatened, and the national interest suffers.

Kennedy’s four basic consumer rights led to the establishment of the Consumer Product Safety Commission and to the passing of anti-trust, patent, and price gouging laws, as well as the creation of non-governmental actors like the Better Business Bureau to protect consumer rights.

While Americans take many of these protections for granted, they are often under assault from business interests and lawmakers. Regulatory agencies from the Food and Drug Administration to the Securities and Exchange Commission have been subjected to drastic budget cuts, as well as repeated efforts to prevent them from passing new regulations or enforcing those that already exist.

Those same efforts are now focused on the newest consumer protection agency, the Consumer Financial Protection Bureau. President Obama appointed the CFPB’s first director in January, after more than a year of Republican promises that they would block his nominee. Despite those efforts, the CFPB is already helping consumers in numerous ways, primarily by taking steps to prevent and remedy the predatory, discriminatory, and potentially illegal financial practices that were prevalent during the housing crisis.

“The federal Government — by nature the highest spokesman for all the people — has a special obligation to be alert to the consumer’s needs and to advance the consumer’s interests,” Kennedy said. “Their voice is not always as loudly heard in Washington as the voices of smaller and better-organized groups–nor is their point of view always defined and presented. But under our economic as well as our political form of democracy, we share an obligation to protect the common interest in every decision we make.”

Former SEC Official Slams House JOBS Act: ‘It Won’t Create Jobs, But It Will Simplify Fraud’

In a rare show of bipartisanship, the House of Representatives easily passed the Jumpstart Our Business Startups (JOBS) Act last week, with both parties touting it as a way to help small business startups and boost the economy. The White House supports the bill, and Senate Democrats are planning to introduce it (or something like it) in the coming days.

Regulators and business advocates, however, have a different view of the bill, which would remove or weaken regulatory hurdles for so-called “emerging growth companies” that are raising money through public offerings, exempt some companies from government audits, and make it easier for companies to use “crowd funding,” allowing them to raise money online from a large number of investors without filing disclosure forms.

Securities and Exchange Commission (SEC) Chairwoman Mary Schapiro is concerned that the bill would rollback significant investor protections, she wrote in a letter to the Senate Banking Committee last night. Former SEC chief accountant Lynn E. Turner took an even dimmer view of the bill, Bloomberg reports:

It won’t create jobs, but it will simplify fraud,” Turner said in an interview last week. “This would be better known as the bucket-shop and penny-stock fraud reauthorization act of 2012,” he said, referring to practices banned under securities law.

The JOBS Act would “destroy safeguards dating as far back as the laws that created the” SEC, according to Turner, and would also “weaken important protections” put in place after the accounting scandals that engulfed Enron, WorldCom, and other companies in the early 2000s.

One exemption created by the bill, meant to help small businesses, is “so broad that it would eliminate important protections for investors in even very large companies,” Schapiro wrote. It’s exemption for crowd funding, meanwhile, would make it easier to organize online scam operations at a time when Americans — particularly the elderly — are more susceptible to online scams than ever.

ProPublica’s Jesse Eisinger called the bill a giveaway to lobbyists, short-sellers, Wall Street analysts, and “boiler room operations,” all groups that have been the subjects of recent scandals. “While well intentioned, the JOBS Act…sacrifices essential investor protections without offering any prospects for meaningful, sustainable job growth,” Jack Herstein, president of the North American Securities Administration Association, told the Washington Post.

The Senate still has time to strengthen the bill, though Majority Leader Harry Reid (D-NV) wants to pass it soon. The White House, for its part, says it supports efforts “to ensure that there are sufficient safeguards to prevent abuse,” though it hasn’t said what specifically it would like changed.

Fox News Analyst Calls Goldman Whistleblower Column A ‘Political Hit Job’ By The New York Times

A Goldman Sachs employee yesterday publicly resigned via an op-ed in The New York Times, in which he called the firm “toxic and destructive,” saying that Goldman traders consistently talk about how much profit they are making by ripping off their clients. Goldman quickly mobilized a smear campaign against the former employee, Greg Smith, with “people familiar with the matter” saying that Smith was just miffed at not getting promotions and receiving a comparatively small bonus.

Financial prognosticators on cable news, of course, were quick to take Goldman’s claims and run with them, mocking Smith and saying that he should go start a media firm with the characters from Sesame Street. And today, Fox News’ Charlie Gasparino took on a new target, The New York Times itself, saying that the column was a “political hit job” by the paper of record, and an attempt by the Times to garner credit with the Occupy Wall Street movement:

GASPARINO: I don’t think we can underplay the political significance here. This is different than the New York Times business staff going out and doing an investigate report on what this guy said, you know, using it to develop anecdotes…This is The New York Times, as an institution, this is an op-ed, raising its gun and pointing it at Goldman Sachs. And there’s a political issue here, I believe, many people believe on Wall Street, that it’s playing up to the Occupy Wall Street people, the President’s class warfare rhetoric. This is a political hit job, in many ways…You have to ask what The New York Times’ motives are. This is a political hit job…And remember, what has the New York Times been on a roll about? Occupy Wall Street. Class warfare.

Watch it:

Gasparino also claimed that Smith was merely angry that he wasn’t promoted. “He’s never made managing director, that’s a big thing,” Gasparino said. “There’s a little bit of sour grapes here.” Yesterday, Gasparino tweeted that some Goldman employees were disparaging Smith’s views because “he never made more than $750,000 a year.”

Republican Rep. To Propose Surtax On Millionaires

Rep. Rick Crawford (R-AR)

If there’s one thing that House Republicans have stood for since retaking the lower chamber in 2010, it is that any tax increases — even on the wealthiest Americans — were completely off the table. Holding to the mantra of “Washington does not have a revenue problem; Washington has a spending problem,” the GOP has time and again blocked any measure to raise rates on millionaires.

However, one House Republican — Rep. Rick Crawford (AR) — plans to break with the rest of his party today by proposing a surtax on millionaires:

Freshman Republican Rep. Rick Crawford will propose a surtax on millionaires Thursday morning, a crack in the steadfast GOP opposition to extracting more money from the nation’s top earners. [...]

Crawford will propose the additional tax— expected to be north of 2.5 percent — on individual income over $1 million as part of a broader fiscal responsibility package.

“He’s watched the Gangs of Six and 100 and deficit commissions, as well as leadership’s budget and tax plan, and he feels there will never be a deal that will pass the Senate without a revenue component,” a Crawford aide said, describing the legislation without attribution because it has not yet been officially announced.

Crawford has signed the Americans for Tax Reform anti-tax pledge, making him the latest Republican to abandon fealty to anti-tax crusader Grover Norquist’s organization and its destructive pledge. Last week, Rep. Tim Johnson (R-IL) blasted the pledge as “disingenuous and irresponsible.”

At the moment, 25 percent of millionaires pay lower taxes than millions of middle-class families, while poll after poll has shown that Americans support raising more revenue from those at the top of the income scale.

Econ 101: March 15, 2012

Welcome to ThinkProgress Economy’s morning link roundup. This is what we’re reading. Have you seen any interesting news? Let us know in the comments section. You can also follow ThinkProgress Economy on Twitter.

  • President Obama and UK Prime Minister David Cameron yesterday discussed the possibility of tapping emergency oil reserves as a response to rising gas prices. [Reuters]
  • Goldman Sachs saw nearly $2.2 billion of its market value disappear after an employee publicly resigned due to the bank’s “toxic” culture. [Bloomberg]
  • The Senate yesterday finally approved a two year, $109 billion transportation funding bill by a 74-22 vote. [Washington Post]
  • Some of the nation’s biggest banks are using the Federal Reserve’s latest stress tests as justification to dole out billions in dividends. [New York Times]
  • The free trade deal between the U.S. and South Korea officially goes into effect today. [The Hill]
  • The Obama administration and members of both parties are looking at changing the tax treatment of debt. [Businessweek]
  • Chinese Premier Wen Jiabao suggested yesterday that China may not let the yuan rise in value any more against the dollar. [The Hill]
  • Lawmakers are increasing pressure on the Securities and Exchange Commission to implement CEO pay rules that are in the Dodd-Frank financial reform law. [Huffington Post]

Switch to Mobile
ThinkProgress Signup Overlay Skip and Continue to ThinkProgress Skip and Continue to ThinkProgress

Sign Up