Robert B. Reich's Blog, page 7

The Supreme Court seems to have no problem regulating women’s bodies. But when it comes to regulating big business, they may be ready to end 40 years of established law. Let me explain.

The Court is hearing a pair of cases that could upend federal regulations designed to protect us. At risk is the Biden Administration’s entire climate agenda, the power of the government to approve and regulate drugs, and even the safety and quality of the food we eat, the water we drink, and the air we breathe.

And big corporations are salivating for a ruling that goes their way.

So what’s putting all of this at risk? It’s a challenge to something known as the “Chevron” Doctrine, a legal precedent established by the Supreme Court’s ruling in the 1984 case Chevron v. Natural Resources Defense Council. That case held that whenever any regulation in a law is unclear, it should be the federal agencies, not the courts, that interpret and implement it. This makes sense because unlike courts, federal agencies are staffed with scientists, researchers, and engineers — actual experts in the fields they’re regulating.

But now, a pair of Supreme Court cases challenging the doctrine could shift this power to the courts, stripping federal agencies of this key role of interpreting and implementing our nation’s laws.

If non-expert courts become the sole interpreters of the nation’s laws, a single activist judge, carefully selected by plaintiffs, could invalidate all the regulations of a federal agency charged with protecting the public.

No wonder the big banks, fossil fuel companies, and pharmaceutical giants, who hate the power of federal agencies to limit their profits, have been trying for years to end the Chevron Doctrine. And this time, they think they have the votes on the Supreme Court to do it.

If agencies are stripped of their power to regulate, the big losers will be the American public. We need real experts tackling today’s complicated problems, not judges who think they know better.

We also need to see the potential fall of the Chevron Doctrine for what it is: a power grab by corporate interests, allowing them to shop for judges who will strip agencies of their power to protect the public.

Trump failed to deliver on his number one campaign promise:

President Trump presided over a historic net loss of nearly 3 million American jobs, the worst jobs numbers ever recorded under an American president.

This is no fluke. America’s economy has almost always done worse under Republican presidents. A New York Times analysis found that since 1933, the U.S. economy has grown nearly twice as fast on average under Democrats.

Now Trump’s defenders claim it’s not his fault that the economy collapsed under his watch. It was the pandemic. But there are two big things wrong with this.

First, the pandemic recession was as bad as it was because of Trump. His failure to lead with any national strategy left America in chaos throughout 2020, long after other nations had developed coordinated testing, tracing, and social distancing plans that allowed them to reopen their economies.

But secondly, even before the pandemic, Trump failed to deliver on his economic promises. Job growth slowed under Trump.

America added more jobs in President Obama’s last three years than in Trump’s first three.

Even before the pandemic most middle-class American households saw their incomes go down under Trump.

Trump’s major economic policy was cutting taxes on the rich and big corporations. He promised it would result in $4,000 annual raises for workers. How did that work out? Did you get a $4,000 raise?

Republicans keep claiming that if we just cut enough taxes on the rich, the wealth will “trickle down.” But it never works. Wage growth slowed after Reagan’s tax cuts for the rich and big corporations. And the Bush and Trump tax cuts didn’t trickle down either.

These giveaways to the wealthy came at the expense of investments in infrastructure, education, and health care, making life more expensive and difficult for everyone who isn’t rich.

They also exploded the debt and deficit. Reagan oversaw a 186% increase in the national debt — the biggest percentage increase in over 70 years. The Bush and Trump tax cuts, that mostly benefited corporations and the rich, are the main reasons why America’s debt is growing faster than the economy.

Republican presidents have led us into the three worst economic crises of the last century, and Democrats led us out of them.

Republicans talk about running the country like a business, but they want to run it the way Trump ran his businesses: with massive debts, a string of failures, and payouts for the folks at the top, while workers get shafted again and again. Given Republicans’ track record, why would any hard-working American put their financial security in the hands of a Republican president ever again?

Many Americans today worry that our nation is losing its national identity. Some claim loudly that the core of that identity requires better policing of our borders and preventing other races or religions or ethnicities from supplanting white Christian America.

But that is not what defines our national identity. It’s the ideals we share, the good we hold in common.

That common good is a set of shared commitments. To the rule of law. To democracy. To tolerance of our differences. To equal rights and equal opportunities for everyone. To upholding the truth.

We cannot have a functioning society without these shared commitments. Without a shared sense of common good, there can be no “we” to begin with.

If we’re losing our national identity, it is because we are losing our sense of the common good. That is what must be restored.

Some of you may feel such a quest to be hopeless. Well, I disagree.

Almost every day, I witness or hear of the compassion and generosity of ordinary Americans. Their actions rarely make headlines, but they constitute much of our daily life together.

The moral fiber of our society has been weakened but it has not been destroyed.

We can recover the rule of law and preserve our democratic institutions by taking a more active role in our democracy.

We can fight against all forms of bigotry. We can strengthen the bonds that connect us to one another.

We can protect the truth by using facts and logic to combat lies.

Together, we can rebuild a public morality that strengthens our democracy, makes our economy work for everyone, and revives trust in the institutions of the nation.

America is not made great by whom we exclude but by the ideals we uphold together.

We’ve never been a perfect union. Our finest moments have been when we have sought to live up to those shared ideals.

I hope you’ll join me in carrying forward the fight for the common good.

You might start by sharing this video with your friends and loved ones.

Shopping on Amazon? Stop! Watch this first.

Amazon is the world’s biggest online retailer. This one single juggernaut of a company is responsible for nearly 40% of all online sales in America. In an FTC lawsuit, they’re accused of using their mammoth size, and consumers’ dependence on them, to artificially jack up prices as high as possible, while prohibiting sellers on Amazon from charging lower prices anywhere else.

They’re accused of using a secret algorithm, codenamed “Project Nessie,” to charge customers an estimated extra $1 billion dollars,

If this isn’t an abuse of power that hurts consumers, what is? So much for all of those “prime” deals you thought you were getting.

Project Nessie isn’t the only trick Amazon has been accused of using to exert its hulking dominance over the online retail industry — leading to higher prices for you.

Much of the FTC’s antitrust lawsuit centers around the treatment of independent merchants who sell items on Amazon’s online superstore — accounting for 60 percent of Amazon’s sales.

Amazon allegedly uses strongarm tactics that force these sellers to keep their prices higher than they need to be. Like barring them from selling products for significantly less at other stores — or else risk being hidden in Amazon’s search results or having their sales stopped entirely.

And Amazon is accused of engaging in pay-to-play schemes and charging merchants excessive fees that end up costing you even more.

Independent sellers are effectively forced to pay Amazon to advertise their products prominently in search results. If they don’t fork over cash, then their products get buried underneath products of companies who do. This hurts sellers but also harms shoppers who have to parse through less relevant products that may be more expensive or lower quality.

And to be eligible for the coveted “Prime” badge on their items — which is considered crucial for competing on the platform — independent sellers are pushed into paying Amazon for additional services like warehousing and shipping, even if they could get those services cheaper elsewhere. If sellers forgo trying to qualify for Prime, their goods apparently become harder for customers to find.

When all of these extra fees are added up, Amazon takes around a 50 percent cut of each sale made by a third party. It’s projected that Amazon will earn around $125 billion from collecting fees in the U.S. in 2023, most of which get passed on to you.

By charging all of these extra fees and stifling independent companies from selling their products for less elsewhere, Amazon is using its dominance to essentially set prices for all consumers across the internet.

And when you combine Amazon’s control of ecommerce with all of the other industries it has entered by gobbling up companies — such as Whole Foods, One Medical, and MGM — you’re left with a behemoth that simply has too much power.

This is all part of a much larger problem of growing corporate dominance in America. In over 75% of U.S. industries, fewer companies now control more of their markets than they did twenty years ago.

The lack of competition and consumer choice has resulted in all of us paying more for goods because corporations like Amazon can raise their prices with impunity. By one estimate, corporate concentration has cost the typical American household $5,000 a year more than they would have spent if markets were truly competitive.

This power isn’t just being used to siphon more money from you. A giant corporation has the power to bust unions, keep workers’ wages low, and funnel money into our political system.

It’s a vicious cycle, making giant corporations more and more powerful.

But under the Biden administration, the government is making a strong effort to revive antitrust law and use its power to reign in big corporations that have grown too powerful.

We must stop the monopolization of America. This FTC lawsuit against Amazon is a great start.

A majority of Americans support a wealth tax. But, surprise, surprise, the wealthy Republican megadonors who’ve been plying Supreme Court justices with gifts and vacations do not. And if those justices don’t recuse themselves from a case I’m about to explain, it will be a grave conflict of interest and potentially block Congress from ever enacting a wealth tax.

Moore v. U.S. concerns a one-time tax charged in 2017 on profitable foreign investments regardless of whether investors cashed them in.

The plaintiffs argue that the tax is unlawful under the 16th Amendment, which gives Congress the power to tax incomes.

Right now the super wealthy can take advantage of increases in the value of their stock portfolios by using stock as collateral to borrow all the money they need instead of taking taxable income. It’s a way to have their cake and eat it too.

If the Supreme Court buys the argument that the Constitution does not give Congress the power to tax increases in the value of investments, that would make it impossible to ever pass a wealth tax.

But here’s the kicker: This case raises profound conflicts of interest on the Supreme Court.

Justices Samuel Alito and Clarence Thomas both accepted luxury vacations from billionaires who stand to gain financially and are tied to conservative political groups that are responsible for appealing the case.  

No wonder Americans don’t trust the Supreme Court.

So what can you do?

First, share this video to spread the word about this little-known case.

Second, contact your representatives, and urge them to demand that justices with conflicts of interest recuse themselves.

And third, if your representative doesn’t support a wealth tax to combat inequality, replace them with somebody who does.

With so much at stake, now is not the time to sit on the sidelines.

As secretary of labor, I thought it important to explain why the Democrats had lost both the House and the Senate in the 1994 midterm elections. I attributed it to the fact that many middle class Americans felt angry and frustrated about not getting ahead, and they took it out on Democrats who had been running Congress for many years. I took a lot of heat for this speech 29 years ago. 

Watch and tell me if I was wrong.

Children of the super rich are more than twice as likely to get into America’s most elite universities as middle-class students with the exact same test scores. This fast-tracks them to become the next generation of CEOs and lawmakers, and helps keep wealth and power in the hands of people who started out wealthy and powerful.

A big reason rich kids have such an advantage is so-called “legacy admissions” — the preference elite schools give to family members of alumni.

The vast majority of Americans, across the political spectrum, think this is unfair. An astounding 68% of all voters support banning legacy admissions outright. This is the strongest bipartisan agreement I think I’ve ever seen on an issue that boils down to who gets special privileges in America.

Now I went  to an Ivy League school (Dartmouth), followed by Oxford, and Yale Law. I wasn’t rich. My father ran a clothing store.

That was a half-century ago — before inequalities of income and wealth exploded in America, before the middle class began shrinking, before the American oligarchy began corrupting American politics with a flood of big money donations. Today, it’s much harder for a middle-class kid to get the same opportunities that I had.

New research conducted at Harvard (ironically) looked at 16 years of admissions data from the Ivy League schools, plus Stanford, Duke, MIT, and the University of Chicago.

The research reveals that one in six students at these prestigious schools comes from the richest 1% of American families.  

Why are so many rich kids getting in? It’s not because they’re better students.

Children from the top 1% were 34% more likely to be admitted than middle-class students with the same SAT or ACT scores.

Those from the top ONE TENTH OF ONE PERCENT were more than twice as likely to get in.

Legacy admissions are one of the biggest reasons. Nearly 30% of Harvard’s Class of 2023 were legacies.

It’s a vicious cycle that consolidates wealth and power in the hands of a few.

Less than 1% of Americans get into one of these top schools, but their graduates account for 12% of the Fortune 500 CEOs,  a quarter of all U.S. senators, and more than a third of all Americans with a net worth over $100 million.

And because these graduates are in the winner’s circle, their children have every advantage in the world — even before they get legacy preferences into the same prestigious universities, which in turn hand them even more advantages.

You see how this entrenches an American aristocracy? Concentrated wealth at the top leads to even more and more wealth concentration with each new generation.

It also perpetuates racial discrimination. Since non-white students were barred from most colleges for much of America’s history, legacy students are by definition more likely to be white.

The Ivy League’s legacy policies were introduced during the Jim Crow era, with the specific intent of limiting the number of students of color and Jewish students who could be admitted.

To this day, about 70% of Harvard’s legacy admissions are white, which is why the U.S. Department of Education is now investigating Harvard for potential violation of civil rights.

And with the Supreme Court’s ruling against affirmative action, this systemic racism is likely to get worse. The Court is pretending to make college admissions “race-blind,” while preserving systems that advance wealthy white students over all others.

It’s time for the government to ban legacy admissions.

The “No Labels” Party is not what it pretends to be. It’s a front group for Donald Trump.

Now I understand, if you’re sick of the two major parties, you might be intrigued by a party that claims to be a “common sense” alternative that finds the middle ground.

But if you or anyone in your life is planning to vote for No Labels — or any third party — in 2024, please watch and share this video first.

Here are three things you need to know.

First, No Labels is a dark money group with secret far-right donors. Investigative reporting has revealed that they include many of the same Republican donors who have pumped huge sums of money into electing candidates like Trump and Ron DeSantis. They also include the rightwing billionaire Harlan Crow, who spent years secretly treating Supreme Court Justice Clarence Thomas to a lifestyle of the rich and famous.

If the No Labels Party is backed by Trump donors, in an election where Trump is on the ballot, there’s actually a label we should give to “No Labels.” Clearly, they’re a pro-Trump group.

Second, the premise No Labels is based on — that Donald Trump and President Biden are at equally extreme ends of the political spectrum — is preposterous.

Trump has been impeached twice, found by a jury to have committed sexual assault, is facing 91 criminal charges in four separate cases — two of them in connection with an attempt to effectively end American democracy.

There is no “equally extreme” candidate as Trump!

Finally, the structure of the Electoral College means that as a practical matter, a third party only draws votes away from whichever major party candidate is closest to it. No third party candidate has ever won a presidential election.

And in this particular election, when one of the major parties is putting up a candidate who threatens democracy itself, we cannot take the risk.

Donald Trump has already tried to overturn one election and suggested suspending the Constitution to maintain power. It is no exaggeration to say that if he takes the White House again, there may not ever be another free and fair election.

Democracy won by a whisker in the last presidential election. Just 44,000 votes in Arizona, Georgia, and Wisconsin — less than one tenth of 1 percent of the total votes cast nationwide — were the difference between the Biden presidency and a tie in the Electoral College that would have thrown the election to the House of Representatives, and hence to Trump.

If candidates from No Labels— or any other third party, like the Green Party or the Libertarian Party —  peel off just a fraction of the anti-Trump vote from Biden, while Trump voters stay loyal to him, Trump could win the top five swing states comfortably and return to the Oval Office. And No Labels’ own polling shows they would do just that!

Let me be absolutely clear. Third-party groups like No Labels are in effect front groups for Trump in 2024, and should be treated as such.

The supposed “centrism” No Labels touts is nonsense. There is no middle ground between democracy and fascism.

Please share this video and spread the word.

Ultra-wealthy elites…Political corruption…Vast inequality…

These problems aren’t new — in the late 1800s they dominated the country during America’s first Gilded Age.

We overcame these abuses back then, and we can do it again.

Mark Twain coined the moniker “The Gilded Age” in his 1873 novel to describe the era in American history characterized by corruption and inequality that was masked by a thin layer of prosperity for a select few.

The end of the 19th century and start of the 20th marked a time of great invention — bustling railroads, telephones, motion pictures, electricity, automobiles — which changed American life forever.

But it was also an era of giant monopolies — oil, railroad, steel, finance — run by a small group of men who had grown rich beyond anything America had ever seen.

They were known as “robber barons” because they ran competitors out of business, exploited workers, charged customers exorbitant prices, and lived like royalty as a result.

Money consumed politics. Robber barons and their lackeys donated bundles of cash to any lawmaker willing to do bidding on their behalf. And when lobbying wasn’t enough, the powerful turned to bribery — resulting in some of the most infamous political scandals in American history.

The gap between the rich and poor in America reached astronomical levels. Large numbers of Americans lived in squalor.

Anti-immigrant sentiment raged, leading to the enactment of racist laws to restrict immigration. And voter suppression, largely aimed at Black men who had recently won the right to vote, was rampant.

The era was also marked by dangerous working conditions. Children often as young as 10, but sometimes younger, worked brutal hours in sweatshops. Workers trying to organize labor unions were attacked and killed.

It seemed as if American capitalism was out of control, and American democracy couldn’t do anything about it because it was bought and paid for by the rich.

But Americans were fed up, and they demanded reform. Many took to the streets in protest.

Investigative journalists, often called “muckrakers” then, helped amplify their cries by exposing what was occurring throughout the country.

And a new generation of political leaders rose to end the abuses.

Politicians like Teddy Roosevelt, who warned that, “a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power,” could destroy American democracy.

After becoming president in 1901, Roosevelt used the Sherman Antitrust Act to break up dozens of powerful corporations, including the giant Northern Securities Company which had come to dominate railroad transportation through a series of mergers.

Seeking to limit the vast fortunes that were creating a new American aristocracy, Congress enacted a progressive income tax through the 16th Amendment, as well as two wealth taxes.

The first wealth tax, in 1916, was the estate tax — a tax on the wealth someone accumulated during their lifetime, paid by the heirs who inherited it. The second tax on wealth, enacted in 1922, was a capital gains tax — a tax on the increased value of assets, paid when those assets were sold.

The reformers of the Gilded Age also stopped corporations from directly giving money to politicians or political candidates.

And then Teddy Roosevelt’s fifth cousin — you may have heard of him — continued the work through his New Deal programs — creating Social Security, unemployment insurance, a 40-hour workweek, and requiring that employers bargain in good faith with labor unions.

But following the death of FDR and the end of World War II, when America was building the largest middle class the world had ever seen — we seemed to forget about the abuses of the Gilded Age.

Now, more than a century later, America has entered a second Gilded Age.

It is also a time of extraordinary invention.

And a time when monopolies are taking over vast swathes of the economy, so we must renew antitrust enforcement to bust up powerful companies.

Now, another generation of robber barons is accumulating unprecedented money and power. So once again, we must tax these exorbitant fortunes.  

Wealthy individuals and big corporations are once again paying off lawmakers, sending them billions to conduct their political campaigns, even giving luxurious gifts to Supreme Court justices. So we need to protect our democracy from Big Money, just as we did before.

Voter suppression runs rampant in the states as during the first Gilded Age, making it harder for people of color to participate in what’s left of our democracy. So it’s once again critical to defend and expand voting rights.

Working people are once again being exploited and abused, child labor is returning, unions are busted, the poor are again living in unhealthy conditions, homelessness is on the rise, and the gap between the ultra-rich and everyone else is nearly as large as in the first Gilded Age. So once again we need to protect the rights of workers to organize, invest in social safety nets, and revive guardrails to protect against the abuses of great wealth and power.

The question now is the same as it was at the start of the 20th century: Will we fight for an economy and a democracy that works for all rather than the few?

We’ve done it before. We can — and must — do it again.

Don’t get scared. I’m going to talk about something that’s caused a lot of fear mongering.

You see, advanced countries, like the United States, pool resources for the common good. How? Well, governments enact taxes and then spend that money on things that benefit everyone. Think of national defense, schools, highways, healthcare, unemployment insurance — basically government spending that protects the well-being of the people.

But since some folk, like your conservative Uncle Bob, think ANY pooling of resources for the common good is…socialism.

And since socialism is apparently so terrifying…

I’m going to use a different word to describe this taxing of individuals for the common good.  Let’s use.. I don’t know.. How about…Banana! That’s not scary, right? 

Great. So, there are essentially three purposes for which governments banana.

First, social insurance against the possibilities of misfortune and neediness, such as unemployment, poor health, disability, and so on.

Second, public goods that we all benefit from, such as parks, highways, public health, and national defense.

Third, public investment in our future, such as basic research, education, and efforts to address pollution and the climate crisis.

Whether we’re talking about Sweden, Spain, or Slovenia or the United States — all countries in capitalist economies banana to benefit the common good.

And bananing is how societies grow their economies, become more prosperous, and ensure a better life for their people.

It’s also how countries aid people in hard times — or when emergencies arise, like a global pandemic.

To simply call any government banana’ing “socialism…” 

Oops, sorry I used the word.…Well it distorts our ability to think through how we banana and what we banana on.

And, it ignores the fact that the United States bananas LESS than most developed nations.

We’re among the worst when it comes to bananaing to reduce poverty, especially child poverty.

And pandemic aside, we banana less on unemployment insurance than nearly every other country.

Of course these countries generally have higher taxes than the United States to support all their bananing.

But they get more in return — better jobless benefits, better health care outcomes, debt-free education, more support for child care and elder care, and more generous retirement benefits.

And we could banana a lot more without having to raise taxes on middle or low-income Americans if the rich paid their fair share. Unfortunately, the tax code in the U.S. has been rigged so that the rich and powerful often skirt what they owe and get away with lower tax rates than regular people.

And the rich have done such a good job convincing people that any increase in banana’ing would be… you know, that S word … that we just accept things as they are.

The only banana’ing they don’t seem to mind is on the military, where we banana more than the countries with the next 10 biggest militaries combined. That’s bananas!

All of this is a major reason why America has such staggering levels of inequality and poverty.

Whether bananing is “socialism” or not is a useless argument. Every country bananas. Capitalism requires banana’ing to ensure a degree of fairness and stability.  

So the next time your Uncle Bob decries any pooling of private resources for the common good — or bananaing — as “socialism”… share this video with him.  

And give him a banana.