Must reads: In the last post in the New York Times' Great Divide blog, Joseph Stiglitz argues that inequality is not inevitable and we "need not just a new war on poverty but a war to protect the middle class." This report from the Economic Policy Institute argues tip-reliant workers should be given the current federal minimum wage instead of $2.31 an hour. Meanwhile the American Enterprise Institute has released a series of TED-like talks on poverty, prosperity, and "a conservative vision for social justice."
You might be interested in this New Times Story from Steven Greenhouse and Stephanie Strom on why some fast food companies play their employees "well above the minimum wage":
Complaining of low profit margins that generally accompany inexpensive menu items, most fast-food restaurants try to keep wages down — the median hourly wage for fast-food workers nationwide is $8.83, compared with $11.50 at Boloco and $10.70 at Shake Shack.
When fast-food executives offer above-average compensation, it is good not only for employees, but also for the brand. Starbucks, which also pays its employees above minimum wage and offers several benefits, received a public relations lift recently in announcing a program that would provide online college educations for thousands of its baristas.
Some competitors assert that these fast-food companies are also influenced by regional economics. They note that many of the companies that pay more are based in high-wage, high-cost-of-living states, like Massachusetts and California, that often have minimum wages well above the federal law. California, where In-N-Out is based, has a $9 statewide minimum wage, while Washington State, home of Seattle-based Starbucks, has the nation’s highest state minimum wage, $9.32 an hour.
In the Huffington Post, the Aspen Institute's Maureen Conway discusses the future of good jobs in a labor market that is relying highly on the service sector:
Now there are many well-paying jobs in the service sector to be sure, but there are also substantial segments of the service sector -- such as restaurants, retail, hospitality and more -- that have large numbers of low-wage jobs. And these jobs are not likely to disappear over the next decade; indeed, they are expected to grow. Fortunately, there are some business leaders that have re-imagined what the structure of work can look like in these industries, and how work can be more rewarding for workers and drive great results for companies... The work of leaders in business who are finding business models that work for companies and for workers need to be highlighted and explored more. If we are truly to address the challenge of inequality, then business leaders will have to be engaged and involved in thinking about transformational strategies in the world of work that can both advance working people and support strong businesses. The education sector needs to help get people ready for a range of work to be sure, but we need the business sector ready to re-think how to organize work in order to inspire and take advantage of the best workers have to offer, and to build strong companies that are good for workers, (and customers) too.
You also might be interested in this talk from the Aspen Institute on entrepreneurship as a job creation strategy: http://youtu.be/JXTbIY8-HNk A new Center for American Progress report from Maryam Adamu argues economic security should be a civil right and lays out policy suggestions on addressing "dignified jobs and worker pay." And this pair of blog posts from PolicyLink discusses Mondragon, a network of worker-owned companies in Spain, and Connecticut's new sick leave law. Meanwhile, Michelle Chen looks at Massachusetts' move to provide greater worker protections to housekeepers and nannies.
We will start with this cartoon from Soapblox:
USAToday offers up a new interactive that looks at how much it really takes to enjoy the "American Dream" these days based on findings from Cornell researchers who put the price tag at about $130,000 for a family of four. Here, just the"essentials" are tallied:
In an interview, co-author Thomas Hirschl, a professor at Cornell University, stressed that for the dozens of people they surveyed and interviewed, the American dream was not about becoming one of the 1%. "It's not about getting rich and making a lot of money. It's about security," he said. It's also as much about hope for the next generation as it is about the success of this one. "They want to feel that their children are going to have a better life than they do," said Hirschl.
Over at the Daily Beast, Keli Goff says it's time to get a new American Dream, because the image of marriage, children, and a house with a white picket fence is outdated and meaningless:
When historian James Truslow Adams coined the phrase “The American Dream” in 1931, he called it “that dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement.” He added, “It is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position.” But over the years this definition of the American Dream has been lost. Instead, when we talk about the American Dream, we often find ourselves talking about marriage, children, mortgage debt, student loan debt, stuff, more stuff, and even more stuff (to fill up the house you owe the mortgage debt on). Thankfully, the tide appears to be turning back in favor of Adams’ definition of the American Dream. A 2011 study found “a sense of meaning” to be the most important factor for Millennials in defining a successful career, even though “meaning” is not the kind of thing that always helps with a mortgage.
The NYT's David Brooks discusses the new American creative climate, which he says is leading to innovations in business such as B-corps:
If you are looking for people who are going to be creative in the current climate, I’d look for people who are disillusioned with politics even as they go into it; who are disenchanted with contemporary worship, even as they join the church; who are disgusted by finance even as they work in finance. These people believe in the goals of their systems but detest how they function. They contain the anxious contradictions between disillusionment and hope.
This creative process is furthest along, I’d say, in the world of B corporations. There are many people today who are disillusioned both with the world of traditional charity and traditional capitalism. Many charities have been warmheartedly but wastefully throwing money at problems, without good management or market discipline. Capitalists have been obsessed with the short-term maximization of shareholder return without much concern for long-term prosperity or other stakeholders.
B corporations are a way to transcend the contradictions between the ineffective parts of the social sector and myopic capitalism.
You should check out this long piece from the San Francisco Chronicle on the city's failing fight to end homelessness over the last decade:
Business Insider's Pamela Engel and Gus Lubin report on new research that shows a disturbing trending in baby boomer homelessness that could signal poor prospects for Millennials:
Every decade, the group facing the highest risk of homelessness was born between 1954 and 1963. Problems facing this cohort of late Baby Boomers were discussed in a 2013 study published in the "Analyses of Social Issues and Public Policy." In short, they came of age in the late 70s and early 80s in a period of depressed wages for unskilled workers, higher youth and young adult unemployment, and rising rental housing costs. At the same time, they faced a proliferation of crack cocaine, leading to social problems and incarceration... Millennials are also facing high unemployment and a steep rental housing market, while heroin and prescription drugs are becoming increasingly prevalent.
In the New York Times, Mireya Navarro looks at the fight over rent stabilization in New York City and at how landlords in Manhattan are pressuring tenants to take buyouts and move in an increasingly unaffordable housing market.
University of California's Gregory Clark conducted research that shows that contrary to popular opinion, "social mobility has always been glacial." The Atlantic's Benjamin Friedman reports:
Most economists assess intergenerational mobility by looking at what people earn, or in some cases what they own, compared with their parents’ income or wealth. Clark is after something broader, encompassing not just people’s income and wealth but also their education, their occupation, their likelihood of holding elected office or other distinguished positions, or of belonging to elite groups. He refers to the entire constellation of such attributes as “status,” or “fundamental social competence,” or “general social competence or ability”—ultimately, “an inescapable inherited substrate, looking suspiciously like social class.” Clark argues that this more comprehensive concept of mobility is what most of us really care about, and he’s probably right. The zillionaire’s son who spends all his time on philanthropy earns a lot less than his father did, but he enjoys a pretty high social standing nonetheless.
In the New York Times, Demos' Lew Daly discusses the GDP and the extent to which it mis-measures the value of government spending:
In obscuring the value of government, the G.D.P. story is leaving us in the dark about potentially crippling trade-offs between fiscal and regulatory austerity and our needs as a society. If we ignore public value in our economy, we will be unable to craft effective policies for a better economic future. If we ignore the economic contribution of regulation, we are less likely to want more of it, exposing our children to greater social risks and costs.
What's next for impact investing, better measurements and higher expectations, writes Adva Salinger in Devex:
By developing a better infrastructure impact investing can ensure that it has the efficiencies of a vibrant market where investors can find the right companies and vise versa, [the Global Impact Invest Network's Amit Bouri] explained.
“Right now there aren't clear enough signals and there’s poor information flow, so the thing that we think is the most critical to address is to strengthen the flow of information and of learning so investors and enterprises can scale their activities and ultimately lead towards more capital flowing — and of course, more people at the end of the day benefiting from the services provided by socially or environmentally oriented businesses,” Bouri said.
Meanwhile, Kings College's Brian Brenberg and Jared Pincin argue that the federal jobless rate is not a good measurement, because it leaves out people who have given up looking for work.