Paid sick days: Their time has come

By Aaron Keating

Imagine waking up with the flu and choosing between going to work sick, or staying home and losing a day’s pay – or worse, your job.

For 190,000 people working in Seattle without paid sick days – many in restaurants and hotels, medical centers and long-term care facilities, even grocery stores – that’s a daily reality.

When a child is sick at school, parents shouldn’t have to worry about getting a negative performance review for leaving work to take them home. Nor should someone lose half a day’s pay to take their elderly parent to the doctor. That’s why I’m proud the Seattle City Council is considering a paid sick days ordinance to ensure people have paid sick days on the job.

More than 30 local businesses and 75+ community organizations worked together to get the ordinance introduced and passed unanimously out of committee. But now, a handful of corporate interests have emerged to oppose this common sense public health and family measure. They’re working to water down it with special exemptions and administrative barriers.

Help make sure every Seattle City Council member gets the message: “Paid sick days mean healthy, responsible prevention – don’t water it down!” Meet on the plaza outside City Hall at 1:45 p.m. on Monday, September 12; we’ll walk up the stairs together to Council Chambers for the 2 p.m. meeting and vote (600 Fourth Ave. 2nd Floor, Seattle, WA 98104). We’ll have signs and stickers – we just need you!

I have a personal reason to support this ordinance: I’m the proud father of a 12-week old baby girl. You can guess I’ve had my share of sleepless nights – but it’s helped me realize how lucky I am.

Growing up, while my father worked full-time as an elementary school teacher, my mother did part-time accounting work, often from home. So when I got pneumonia and missed a week of kindergarten, she could stay home with me. Same when my brother got the chickenpox.

Like a lot of families today, my wife and I can’t afford to work part-time. But we’re lucky: both of our employers provide paid sick days. So when one of us takes our daughter to see our pediatrician, we don’t risk losing part of our paycheck – or worse, our job.

But the way I see it, luck shouldn’t determine whether you can take responsibility for your own and your family’s health. The flu and other illnesses spread quickly in our schools, workplaces, and retirement facilities. And if Seattleites can build software and airplanes for the world, we can certainly ensure everyone can work healthy and care for their families.

If you can’t come to the Council meeting to support the paid sick days ordinance, please email council@seattle.gov or send your letter of support to: Seattle City Council, PO Box 34025, Seattle, WA 98124-4025. Learn more at www.seattlehealthyworkforce.org.

Aaron Keating is a PSARA member and is Operations Director at the Economic Opportunity Institute

Program cuts bleed the nation

By Will Parry

Here’s what we’re up against, and it’s not pretty.

We’ve got a new law on the books, the Budget Control Act (BCA) of 2011. The BCA cuts the discretionary programs people need by nearly one trillion dollars over ten years, but leaves untouched the massive wealth of giant corporations and the nation’s millionaires.

Those cuts are only the beginning. BCA has created a new “super committee” of six Republican and six Democratic members of Congress, and given it until November 23 to seek majority agreement on any combination of spending cuts and increased revenue that produces an additional $1.5 trillion in deficit reduction.

If seven or more members of the 12-member committee can agree, their deficit reduction package will be submitted to Congress for an up-or-down vote, with no amendments allowed. If the plan is not adopted, or if it fails to reduce the deficit by at least another $1.2 trillion, the BCA requires even deeper automatic cuts in federal programs to take effect beginning in 2013.

The deficit hawks have effectively cut the regular committees of Congress out of the action. And they have narrowed the focus of the national discussion to: “How can we cut our way to a balanced budget?”

Progressive Democrats and respected economists say flatly it can’t be done, that slashing the funding for government programs is exactly the wrong medicine. With the economy mired in a long-term recession, with 25 million unemployed Americans, they are calling for a jobs program that’s big and bold, commensurate with the seriousness of the crisis.

The same Republicans who won’t slap so much as a five-cent tax on millionaires are ready to make the millions who depend upon Social Security, Medicare and Medicaid pay for a deficit caused by two wars, multi-billion dollar tax cuts for the wealthiest Americans, and the worst recession since the 1930s.

The threat to the integrity of those basic social programs is ominous. House Majority Leader John Boehner wants the age for full retirement benefits bumped up to 69 or 70. Rep. Jeb Hensarling (R-Texas), co-chair of the Supercommittee, derides the three programs as “cruel ponzi schemes.”

And all six Republicans on the Super Committee advocate deep cuts in Social Security, ending the Medicare protections seniors rely upon, and cutting $1.4 trillion from Medicaid, the sole health care resource of millions of the frail, impoverished elderly.

It does not help that President Obama supports a revision of the Social Security COLA formula that would cruelly tighten the screws on the income of retirees as they grow older, cutting benefits by $560 a year at age 75 and by a full $1,000 a year at age 85.

The grim reality is that the six Republicans on the Supercommittee are not about to be swayed by appeals to bipartisanship. The danger is that they will pick up the vote of one defecting Democrat to create majority support for a proposal laden with still deeper cuts in the programs people depend upon. With seven votes from the committee, the proposal would then go to the full Congress for an up-or-down vote with no amendments.

President Obama is preparing to address the jobs issue as we go to press. Thus far, he has proposed small-bore initiatives that don’t measure up to the deepening crisis created by unemployment on this scale.

“Right now, the old booster rockets are gone,” says the economist Robert Reich. “The original stimulus is over….Combine the budget cuts state and local governments continue to make with the slowdown in consumer spending, the reluctance of businesses to expand or hire, and the magnitude of unemployment and under-employment, and you need a big new booster rocket.”

Reich then outlines his own bold 10-point “booster rocket.” He’d exempt the first $20,000 of income from payroll taxes for two years and make up the shortfall by “scrapping the cap” so that the wealthy pay their full share of the Social Security payroll tax.

Reich would also recreate the Works Progress Administration and the Civilian Conservation Corps to put the long-term unemployed directly to work. He’d create an infrastructure bank to fund the repair and upgrading of everything from roads to schools to sewer systems.

He’d provide relief for homeowners on their mortgage loans and make low-interest loans to cash-starved states and cities. He’d impose a “severance fee” on any big company that lays off an American worker and outsources the job abroad.

“A bold jobs plan is also good politics,” Reich says. “With more than 25 million Americans looking for full-time jobs, the wages of people with jobs falling, and an economy on the verge of a double dip, the President has to come out fighting on the side of average people.”

PSARA’s Frank Irigon seeks Newcastle Council post

PSARA Executive Board member Frank Irigon, a candidate for the Newcastle city Council Position #4, succeeded in winning a slot in the November general election. Three candidates competed and Frank was the second highest vote getter.

The November election will be tough. While the position is an open seat, the other candidate in the race is a former city council member.

Newcastle faces daunting financial challenges. There is no commercial tax base for the community and the primary sources of support for city services are property tax and sales tax revenues as well as development fees.

Frank has expressed enthusiasm for taking on the financial challenges faced by the small city. We know Frank to be a committed, progressive activist and wish him well in the upcoming election.

For more information about Frank’s campaign please email irigonforcouncil@gmail.com, or call 425-235-4795.

‘Be the change you want to see…’

by Maureen Bo, Administrative Vice President

Those were the words of Mahatma Gandhi. He didn’t say, “Just sit there and blame the big guys in the suits, the poobahs, and then go back to your TV program.” Nor did he tell us to do the heroic deeds that cost him his life.

He did give us an example of how one person can initiate change. We don’t need to give our lives, but we do have to take action for change to happen. Here are some ways to make change happen:

1) Use the Retiree Advocate to tell the truth about the political situation that the corporate media suppresses.

2) Invite friends or neighbors to get acquainted with PSARA at one of our meetings or demonstrations.

3) Give that friend or family member a PSARA membership and a year’s worth of political news and insight for just $15.

Movements grow one member at a time. We are building a movement. Each of us can apply the wise words of Gandhi: “Be the change you wish to see.”

Let Senator Murray hear from you

The appointment of Washington Senator Patty Murray to co-chair the Joint Select Committee on Deficit Reduction gives PSARA members, as her constituents, a special opportunity to influence the outcome of the committee’s crucial deliberations.

Senator Murray has invited our “input and thoughts.” She should hear from each of us, urging her to stand fast for the integrity of Social Security, Medicare and Medicaid, and to insist that big corporations and the wealthiest among us bear their rightful share of whatever sacrifice may be required.
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Write Senator Murray at Ste. 2988 Jackson Federal Bldg., Seattle 98174.

Phone Senator Murray at (206) 553-5545.

Email Senator Murray at www.murray.senate.gov.

Vacation musings

By Robby Stern

During my August vacation break I had time to think about some issues that are weighing on my mind.

In recent conversations I heard people ask why there hasn’t been more organized collective anger expressed at the decline in the standard of living and quality of life for the people of our country. Wealthy individuals and multinational corporations use their dollars to buy the government that serves their interests. At the same time, safety net programs, access to education and health care, environmental protection and other basic needs are under greater and greater attack. In addition, the ability to make a family living wage is becoming more and more difficult.

So why isn’t there more of a popular uprising against what is clearly an intolerable situation? Is it, as some say, because not enough people are feeling the pain?

I have several thoughts – and a prediction.

Much of the energy of the discontented went into the 2008 presidential election. Many believed that Barack Obama would attack the economic disparities we were facing. Much faith and enthusiasm went into the election. There is widespread disappointment.. Determining how to move forward from the disappointment and how to organize without turning over the reigns of government to the crazy Republican politician is not an easy task.

In addition, the organizations that can provide the infrastructure for mass action have been weakened by membership decline and are also on the defensive against attacks.

The leadership of these organizations is struggling to determine how to respond to a new reality…i.e., that the very wealthy (with a few notable exceptions), the multinational corporations and their allies are forcefully moving to destroy or neutralize any progressive insurgency in our country. Many of these progressive leaders walk the slender thread between working with traditional allies who are no longer reliable while helping to build a new insurgency that will be very uncomfortable and perhaps even opposed by the traditional political allies.

The mass media has shrunk and has also, in large part, taken a turn to the right. While we may see stories about unemployment, about the growing inequalities in our society, about winners and losers in the new economic order, we hardly ever see or hear coverage of protests and movements to change the present reality.

This lack of reporting leads to a feeling of isolation on the part of those who are acting against the unacceptable political and economic reality. A progressive alternative media is developing through the Internet nd social media, but it has not yet matured into a source that has broad public appeal.

One ruling class strategy in response to the progressive challenges of the 1960s and early 1970s was to promote and fund the idea that happiness comes from consumption of consumer goods and that mass culture needed to be purged of values of progressive social change. The forces of reaction recognized that the media they own, the sports teams they own, and the culture they fund and control should be used to divert the mass population from the critical issues of the day to a more “me first” ethos. At the same time, think tanks were generously funded to lay the groundwork for the attack on the idea that the role of government is to make the lives of the majority better and to create more opportunity for all.

So how do we counter all these bad developments and build a better, more progressive political and economic reality?

1. We have to individually support one another so we do not give in to pessimism. Pessimism will paralyze us. We need to consciously encourage each other to take on the challenges and give emotional and material support to each other.

2. Build organization. It is through organizations that we can reach out, chart a path for progressive change, and unite with other like-minded people.

3. Develop a permanent progressive coalition of organizations, including labor, community groups like PSARA, women’s groups, people of color organizations, religious groups, immigrant groups, etc. We need to do the hard work of arriving at a common vision for our communities and a strategy for achieving that vision. Each organization will have to develop an organizing strategy for their target population. Organizations within such a permanent political coalition will need to be accountable to each other and respectful of each other.

Now for the prediction: We are probably going to get our butts kicked for a while. (We will put up a heck of a fight.) But we are the majority and if we stick to our long-term effort, we will win the day.

Labor Day 2011: Honor those who built the nation

By Jeff Johnson

Labor Day is a time to celebrate the work that we do that has created the economic and social fabric of America.

When the Rev. Dr. Martin Luther King Jr. joined the striking sanitation workers in Memphis in 1968, he proclaimed that “all labor has dignity” and should be afforded the means to achieve the “American Dream.”

That “American Dream” has been rapidly unraveling during the current “Great Recession” and is under full scale attack by corporate America that won’t invest, banks that won’t lend, and politicians who would rather fight over fake political crises, like the debt ceiling, than create jobs.

As austerity budgets are imposed across our country, the great irony is that workers, the elderly, students, immigrants, the poor and the vulnerable, the ones who most suffer under these budget cuts, are being blamed for deficits they did not create.

Wall Street banks caused the immediate economic crisis by treating the economy as if it were their private casino and credit default swaps were their chips – and now these same banks sit on over a trillion dollars of assets and continue to dole out obscene bonuses to the very people who brought us the recession.

But the collapse of the U.S. economy and the world economy has had devastating impacts on working people. In the U.S. and in our state the unemployment rate remains above 9%. It’s twice that if you count those who have dropped off the unemployment rolls without finding work and those working part-time involuntarily. It’s three times 9 percent in the building and construction trades. And it’s higher still for youth and workers of color.

Not since the 1920s has there been such a gross disparity of income and wealth in our country. Workers and the poor simply don’t have the purchasing power to give the economy a boost.

Faced with plunging revenues and increasing demand for social services, state and local governments lack the resources to invest in the social, physical and public infrastructure needed to help strengthen the private economy. Some states are using their deficits in an attempt to crush public employee unions and devastate state and local safety nets.

For several decades our economy has been weakened through policies that have accelerated the concentration of wealth at the top: Deregulation of the financial industry and a tax policy that coddles the wealthy and rewards employers for off-shoring U.S. manufacturing jobs.

Free trade agreements have deindustrialized the U.S. economy through the loss of 50,000 manufacturing plants over the last ten years, have run up huge U.S. trade deficits; and have failed to protect the workers’ most basic labor, environmental, and human rights.

Wisconsin, Ohio and other states have exploited their deficits to eviscerate the collective bargaining rights of public employees. Their public employee unions had grown too influential, it was argued, created too strong a voice for working people and the social safety net, and were therefore responsible for the deficits.

The community response was that Governors Walker and Kasich had severely overreached. People understood that the recession, and not the unions, had caused the deficits.

The popular uprising in Wisconsin has led to the recall of two Republican state senators. In Ohio, citizens have gathered 1.3 million signatures to refer that state’s anti-collective bargaining law to this November’s ballot.

At the federal level we have the manufactured debt ceiling crisis and the resulting “super committee” that will determine our country’s spending and revenue direction. Are the deficits we face as a nation the result of overly generous Social Security, Medicare, and Medicaid benefits, too many workplace health and safety inspections, and too much spending on monitoring clean water and air? Or are they the result of an unfair tax system, a financial industry out of control, trade policies that weaken our overall economy, and the financing of two wars?

We in labor believe the question answers itself. We believe that as a nation, and as a state, we need to confront the real crises facing us –The burning need for jobs, for revenue and for the restoration of moral leadership.

We need to create public jobs programs on the scale of the Works Projects Administration and the Civilian Conservation Corps pf the 1930s. Every state has failing transportation infrastructure – roads, bridges, transit - that we can invest in. We could energy retrofit public buildings creating tens of thousands of jobs, creating demand in the clean energy sector, and reducing our carbon footprint. We could invest in smart energy grids and broadband expansion creating tremendous common good and creating demand for privately produced products. All these investments would create employment, income, and consumer demand.
We need to oppose “Free Trade Agreements” that create substantial net job losses and tax policies that reward the off-shoring of U.S. jobs.

We need to enhance income support and safety net programs -- Unemployment Insurance, Social Security, Medicare, Medicaid, Trade Adjustment Assistance and mortgage relief for homeowners. These policies, too, will increase consumer demand.
In the short run the federal government needs to provide the funds for state and local governments to cover their recession-induced budget deficits. Providing strong state services, state and local employment, investing in our educational, health care, and transportation infrastructures helps create employment and demand and strengthens the private economy as well.

State and local governments need to use their procurement policies to purchase goods and services from local employers employing local workers wherever possible. Similarly, state and local governments can invest their tax receipt accounts, social insurance trust funds, and pension funds in banks that are committed to injecting credit into local communities to finance job-generating investments.

We need a fair tax system that provides the revenue to maintain healthy communities. In our state, we need to place a moratorium for several years on many of the 567 tax exemptions that choke off the revenue we need.

Above all, we need to remove the requirement that any measure to raise revenue or remove tax exemptions must have the support of two-thirds of the legislators. This undemocratic requirement gives a minority of legislators a choke-hold on state revenue and frustrates the will of the majority.

Dr. King used to say, “The arc of the moral universe is long, but it bends towards justice.” To bend that arc will take courage and moral leadership. Join us in bending that arc toward justice!

(Jeff Johnson is President of the Washington State Labor Council, AFL-CIO, and a PSARA member.)

The Advocate interviews Congressman Jim McDermott:

“We need to fix our tax system, which heavily favors the rich…”

By Mike Andrew

When the debt ceiling bill passed Congress in August, half the Democrats in the House of Representatives voted No. One of them was Seattle’s Congressman Jim McDermott.

McDermott talked with The Retiree Advocate to explain why.

Unlike Tea Party Republicans, who actually wanted the US government to default on its debts, McDermott agreed with raising the debt ceiling, but had serious reservations about cost-cutting provisions added to the bill at the last minute to attract enough Republican votes to pass it.

“I voted No in protest of the deficit-reduction provisions,” McDermott said. “We never held a single Congressional hearing on the programs that were being cut in the bill, and I thought it was irresponsible that the Republicans waited until the eleventh hour to work out a deal.”

One of the key provisions of the bill is the creation of a so-called “super-commission” of six Republicans and six Democrats who are charged with working out a long-term deficit-reduction plan.

McDermott says he is skeptical about the commission’s ability to come to agreement on a deficit-reduction package that will be fair and balanced.

“At this point, I am not optimistic given who the Republicans appointed,” McDermott told The Advocate.

Asked if he foresaw cuts to Medicare and Social Security, McDermott replied that he couldn’t rule that out.

“Based on what Republicans have said and proposed thus far, I think the prospects are high for Medicare cuts and changes to Social Security,” he said.

“At this point, I can’t say what exactly what changes will be made to Social Security or Medicare, but one thing that is troubling is the fact that the Republicans appointed to the super committee – the entity empowered to make these decisions – have all signed the pledge to not raise taxes. If taxes are completely off the table, we’re going to have to find alternative revenue sources or make drastic changes to our entitlement programs.”

One change that McDermott completely rejects is the Medicare voucher system proposed by Tea Party darling Congressman Paul Ryan (R-WI).

“Seniors, like all Americans, deserve health security, and the idea of sending a senior out into the marketplace to shop around for health insurance is just something that is inconceivable,” McDermott insists.

“Medicare is an important program, greatly valued among seniors, and there is no reason to replace it with a voucher system when we could just make changes to the program so that it can continue to provide benefits for decades to come.”

Asked how to solve the country’s long-term deficit problem if cuts to Medicare and Social Security are off the table, McDermott immediately brought up the idea of a fairer tax system.

“We can’t reduce the federal debt by simply cutting,” he said. “It isn’t possible and it isn’t fair.

“I think we need to fix our tax system, which heavily favors the rich, as things stand. In doing so, we need to ensure that the millionaires and billionaires, as well as America’s corporations, are paying their fair share when it comes to taxes.”

Fading Retirement Prospects Explain Why We’re So Glum

By DAVID GROVES

A new statewide Elway Poll finds that more of us are worried about the future than ever, or at least since he began asking that question 20 years ago.

"What troubles me right now is I'm pushing 50 years old, and the market is pretty dead," Ron Ross told the Seattle Times. "I'm nervous for my future and my retirement because I don't think Social Security is going to be around. And I'm just watching my 401(k) do nothing except get smaller."

That neatly sums up the anxieties being faced by all Americans.

This summer, dramatic market fluctuations have become the norm as stocks plummet on the latest crisis in Europe or worries about whether Congress will pay America’s bills. The Dow Jones Industrial Average dropped more than 500 points in a day three different times in August. So far, the market has mostly rebounded from these rapid declines, but we all remember the Great Recession’s October 2008 crash when the Dow lost nearly 20% of its value in one week.

These wild market gyrations cause more than just heartburn, they wreak havoc on Americans’ hopes and dreams for the future.

With the decline of defined-benefit pension plans and the shift to 401(k)-style savings plans invested in company stock or mutual funds, many Americans have become part of the “investor class” George W. Bush envisioned. In the process, we have lost our retirement security.

Down markets postpone or ruin retirement plans. They wreak havoc for existing retirees whose fixed incomes depend on modest earnings from their lifetime of savings. And they harm job prospects for our youngest workers, as stock fluctuations create waves in the labor market as older workers are suddenly unable to leave the workforce and create vacancies for the next generation.

A recent special report in the San Jose Mercury News concluded: “Many older workers are responding to the economic downturn by postponing retirement, but even so, it will be a struggle to make up for market losses in their retirement plans. Some were counting on their houses as a post-work financial cushion, but now their homes are worth less. They can't depend on dividends and interest on savings -- that income has nearly vanished. They also face layoffs and difficulties getting rehired.”

Glum yet?

As if all this wasn’t bad enough, certain politicians in Washington, D.C., insist on actively undermining public faith and confidence in Social Security and Medicare, the pillars of American retirement security, and are proposing to cut their benefits rather than take the modest steps necessary to preserve and enhance both programs.

It’s no wonder this generation has never been so gloomy. If we can find work, we face the prospect of working until we die.

Our gloom is the result of decades of economic policies that put profits before people, and will take decades to correct. But let’s start by fighting to protect, preserve and strengthen our Social Security and Medicare safety nets.

Making it tough to get help

By Maureen Bo

“Face-to-face service could become a thing of the past for many clients when the agency moves into the Jackson Federal Building next year.”

That was the warning issued by the American Federation of Government Workers, the union representing Social Security staff, when the regional administrators overrode protests about their plan to close two easily accessible offices and require Social Security beneficiaries to go to an office in the high-security federal office building.

To enter the Jackson Federal Building, a Level 4 Security building, requires a current official picture ID and electronic scan of any packages brought by the person seeking entry. Social Security has many clients who are either disabled, homeless, mentally ill or some combination of the three. Many have all their belongings in a shopping cart or backpack.

For many clients, the effect of the consolidation would be to deny them the many kinds of help they need and have always been able to get.

On August 12, local union leaders, congressional staff, and advocates for the elderly, homeless and disabled, including the Puget Sound Alliance for Retired Americans, met with Eileen McSherry, Communications Director for the regional Social Security Administration, to protest the consolidation.

McSherry defended the move as a budget-cutting measure, and said the decision, made by the General Services Administration, was final.

Thalia Syracopoulis, a leader in the National Organization for Women and a PSARA member, asked why the consolidated office could not be in the Columbia Tower, wich already houses about 300 Social Security employees, and which has no security requirements. McSherry responded that there was no more room in the Columbia Tower.

Advocates followed up the unsatisfactory session with McSherry with a meeting with staff of Senators Patty Murray and Maria Cantwell and Representative Jim McDermott, where it was agreed to seek an appropriate office in other federal property.

Our members are urged to contact Regional Commissioner Stanley Friendship at stanley.c.friendship@SSA.gov, phone 206-615-2107 calling on him to reconsider this bureaucratic decision. Calling our two senators and your federal representative would also help.

PSARA represented at DC Care Congress

By Mike Andrew

PSARA Board members Vivian Lee and Bonny Oborn represented us at the national Care Congress on July 12 in Washington DC.

Some 700 people representing more than 150 organizations attended the meeting to develop plans for the “Caring Across Generations” campaign, to improve the lives of elderly and disabled people and their caregivers.

“There are what we call the ‘five fingers of the caring hand,’” Lee explained. “Job creation, job quality, training and a career ladder, a pathway to citizenship, and support for individuals and families who need care.”

After a Plenary Session featuring what both Lee and Oborn agreed were “excellent speakers,” including White House advisor Valerie Jarrett and Secretary of Labor Hilda Solis, the two split up.

Lee attended a workshop on organizing and building local organizations.

Oborn met with members of Congress, including Sen. Al Franken (D-MN), to discuss protecting funding for Medicare and Medicaid in the current round of deficit reduction negotiations.

“We need to continue to fund Medicaid,” Oborn said. “That’s a big part of the [Caring Across Generations] campaign, because that’s the way caretakers are getting paid.”

“Unfortunately,” she continued, “they say that’s ‘on the table.’ It’s still unresolved.”

One goal of the Caring Congress is to create local groups to organize around specific local initiatives and to push legislation. Lee and Oborn say that a Seattle core group is already coming together around Casa Latina, Service Employees Local 775NW, and Washington Citizen Action Network.

At PSARA’s August membership meeting, Lee and Oborn reported on the Congress and the members voted to join the local Care Council.

“There are many reasons PSARA would get involved,” Lee pointed out. “Social security, Medicare, Medicaid – those are our core issues. This [campaign] is the only way to get the caretakers paid decently.

Changing demographics make the Caring Across Generations campaign particularly timely, both Lee and Oborn said.

“The Baby Boomers are starting to retire and many of them will need care,” Lee said. “Plus there are many veterans who are returning with injuries and disabilities.”

“It’s a developing labor market,” she pointed out. “You want to create jobs? I noted this down from the Congress – every 8 minutes someone turns 65, 10,000 people turn 65 every week.”

Greece, Part II: A different economic model

By Mike Andrew

Last month in Part I of this article, we saw that the economic “reforms” forced on Greece by the EU harmed the country’s working families and caused its economy to contract.

In this article, we’ll look at an alternative economic model actually implemented in Greece by the socialist PASOK party in the 1980s.

Since modern Greece was recognized as an independent country in 1832, it has had to contend with very weak growth in its domestic economy.

This in turn led to twin economic problems.

First, there were more Greek workers than the job market could accommodate, and some way had to be found to cope with the large number of unemployed workers.

Second, the country was particularly vulnerable to global economic trends, to penetration by foreign capital, and to political control by richer countries.

The military dictatorship that ruled Greece from 1967 to 1974 was the last gasp of the old system of political intervention by ambitious army officers.

It was also the first gasp of a new neo-liberal approach to economic growth.

The dictatorship promoted foreign investments in Greece, especially in the tourism industry, borrowed heavily from foreign banks to finance public-private construction projects, and cracked down brutally on Greece’s labor unions.

When Andreas Papandreou – the father of the present prime minister – became prime minister in 1981, he adopted measures to stimulate internal markets.

A socialist and an economist of international standing, one-time chair of the Economics Department at UC Berkeley, Andreas scorned the supply-side economics promoted by Ronald Reagan and Margaret Thatcher.

Instead, he believed that demand for Greek products, and therefore Greek labor, inside Greece itself would be the driver for economic growth and national prosperity.

Andreas raised wages for public employees and also raised pensions for retirees, and he introduced COLAs for both wage-earners and pensioners, giving Greeks more money to spend.

By lowering the retirement age, he also made room for younger workers to enter the job market.

And he substantially increased spending in the public sector with a variety of construction projects, including restoration of the Parthenon and other historical sites.

Andreas financed this economic stimulus program not mainly by borrowing and not mainly by raising taxes, although he did both, but by increasing the money supply – “printing more money” as conservative economists put it.

This policy was inflationary, and required a devaluation of the drachma, Greece’s national currency at the time, in October 1985, but it produced a period of economic prosperity unparalleled in modern Greek history.

Inflation harms banks, which lend money at fixed interest rates, and it harms people with substantial cash assets in the bank, who see the value of their deposits erode.

On the other hand, inflation doesn’t necessarily harm wage-earners or pensioners who live pay check to pay check, as long as they get COLAs that help keep income ahead of the rate of inflation.

Greeks saw their real incomes, adjusted for inflation, rise by 26% during Andreas’s first two terms as prime minister in 1981-1989.

To give an idea how significant this is, let’s look at US incomes. The median household income in the US in 2009 was $50,221. A 26% increase would bring that household’s income to $62,776.25.

Would that extra $12,555.25 make a difference to a working family? You bet it would!

Andreas’s economic policies were not completely successful, however.

Unemployment went up during his administration, in part because increased social benefits and general economic prosperity made unemployed Greeks want to stay at home rather than emigrate.

Andreas also believed that his go-it-alone foreign policy – which included withdrawing Greek troops from NATO command – required continued high military spending, which led to borrowing to finance weapons purchases, and ultimately increased indebtedness to US and European banks.

The devaluation of the drachma stimulated growth in the tourist industry, which meant that Greece continued to be vulnerable to global economic trends.

Nevertheless, when Andreas Papandreou retired in 1996 and died soon after, Greece was in the best economic position it had ever been in its modern history.