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THE FALL OF THE GE BOSTON DEAL, PART II

PIZZA BARONS LAY OFF 1,100: PAPA GINO’S & D’ANGELO WORKERS NEED TO ORGANIZE FOR JUSTICE

Image by Don Kuss
Image by Don Kuss

 

November 7, 2018

BY JASON PRAMAS @JASONPRAMAS

 

Mainstream press coverage of mass layoffs like Sunday’s shutdown of almost 100 Papa Gino’s and D’Angelo fast food restaurants generally looks upon such tragic events through a glass, darkly. Because journalism in the service of the rich and powerful is a poor reflection of reality when it comes to all things labor. Which is why early reportage in major news media typically involves simple transcription of executives’ rationales for such precipitous decisions. Rather than immediate investigation of the massive damage done to the lives of, in this case, more than 1,100 area workers summarily terminated with no official warning of any kind, according to the Boston Globe.

 

True to form, PGHC Holdings Inc., the Dedham-based parent company of both brands, has excuses at the ready for credulous reporters. None of which explain why it’s acceptable to treat its workforce—the people that built the company and kept it running through good times and bad—like so much garbage. But that’s fine and dandy, yes? Given that few journalists ever seem particularly concerned about the human cost of mass layoffs. It’s just assumed (and sometimes stated) that “the market” will take care of everything. Such “disruption” is “good for the economy,” doncha know. And if some hapless working poor people lose their apartments, lose custody of their children, go hungry, and end up on the streets, then that’s their fault for not being “competitive” enough and getting more degrees. Or something. Not the fault of the company that put them there.

 

In any event, according to the Boston Business Journal, PGHC released a statement on Monday explaining “that it had filed for Chapter 11 bankruptcy protection. [The company] also announced that it had reached an agreement in principle to be sold to a portfolio company of Wynnchurch Capital, a private equity firm that has offices in Chicago, Los Angeles and Toronto.”

 

“Private equity firms,” according to a major 2014 investigation by the New York Times, “now manage $3.5 trillion in assets. The firms overseeing these funds borrow money or raise it from investors to buy troubled or inefficient companies. Then they try to turn the companies around and sell at a profit.” Ironically, some of the largest investors in such firms are public sector pension funds. Whose unionized members have no idea what their money is being used for—thanks to byzantine and opaque agreements between their pension funds and firms like Wynnchurch that aim to keep them and the public at large in the dark about buyouts like the tentative PGHC deal.

 

The details that are visible are disturbing enough. According to Boston Globe business columnist Jon Chesto, PGHC “[c]hief financial officer Corey Wendland pointed to one big reason for his company’s need for more dough: minimum-wage increases across many of its markets, combined with higher health insurance expenses.”

 

You read that right. One of the executives directly responsible for destroying the lives of hundreds of working-class families in Massachusetts, Rhode Island, Connecticut, and New Hampshire is blaming legislation that’s gradually raising minimum wages in three of those states (minus, sadly, the Granite State) to levels that they should have been at over a decade back for his company’s crisis. Not corporate mismanagement or malfeasance.

 

It’s basically all the fault of those darned unions and other labor advocates for pushing higher wage floors that still don’t even allow many workers to make ends meet once enacted. Massachusetts, for example, will go from the abysmal $11 an hour rate mandated by 2017 to a somewhat less abysmal $15 an hour over five years starting in January. For readers who think that wage is too high, try living on $15 an hour most anywhere in southern New England right now—assuming you get 40 hours work a week, which many Papa Gino’s and D’Angelo workers didn’t—and see how you do.

 

Naturally, since laid-off PGHC workers weren’t unionized, they had nothing and no one to protect them when the corporate ax fell over the weekend. Even the federal Worker Adjustment and Retraining Notification (WARN) Act that provides extended unemployment and retraining benefits to victims of a narrow range of mass layoffs may not apply here. Although, as with area NECCO workers who were also laid off en masse this year with no notice, it may be worth trying a class action lawsuit to demand WARN coverage anyway. But with most of the affected PGHC workers making minimum wage, they have next to nothing saved to see them through the difficult period they now face. While the unemployment they may not all qualify for will definitely not be enough to live on until they find new jobs, given their low pay rate. So, it will even harder for them to mount such a suit than it has been for the NECCO crew.

 

A D’Angelo manager who writes under the nom de plume C.D. Madeira took a job at another company about three months ago and agreed to provide an insider’s perspective on the layoff crisis to me in an interview. Unsurprisingly, Madeira says that PGHC was not a decent employer even before its recent action.

 

“I worked for D’Angelo for two and a half years as a manager. They treated us like trash, the minimum wage employees worse. Management was paid as little as possible while required to work 50 hours a week and often much much more. More often than not they required us to work that extra off the clock so as not to skew their labor information. They refused to repair restaurants even when it was a danger to employees and customers.

 

“Basically, I’m glad I don’t work there anymore and that I got out before this happened, but I know many people who are now out of a job.

 

“They closed nearly 100 locations, between the Papa Gino’s and D’Angelo brands, leaving over 1,000 people without jobs and without notice. No severance pay. No PTO [paid time off] payout. Nothing. People went to work assuming they would have a job and they were turned away. Those who had jobs were given calls throughout the day to tell them to close up shop permanently. They were told they could apply at other corporate locations for consideration for rehire.”

 

Not that laid-off PGHC workers are exactly taking the situation lying down. Many have plastered the Papa Gino’s Facebook page with angry messages. Leading the parent company to respond on the page with another statement, “While we regret the rather abrupt closures, we are currently undergoing major updates to better serve our guests and ask for your patience as we make these changes. As New England’s local pizzeria since 1961, we are still standing strong and will be relaunching our restaurants, introducing improvements for the benefit of all of our guests.”

 

Madeira doesn’t buy it: “I saw the breakdown of the conference call they had with the general managers who remain. Basically they’re painting this as, ‘Well, now that we have all these underperforming restaurants out of the way, we can totally renovate the remaining locations!’ Many stores they closed were not underperforming. Also they’ve known about this sale for months. They were talking about putting the brand up for sale a couple of months before I left. So this has been in the works for well long enough to have warned people.

 

“They’ve always been shady. Papa Gino’s originally bought the D’Angelo brand to try and save itself but instead ended up dragging it down completely from what I heard from old-time employees.”

 

This is the testimony that the public has not yet heard in the local press. And it’s infuriating, if not much of a shock to anyone who has worked in low-wage sectors like fast food before.

 

The question now is: What can laid-off Papa Gino’s and D’Angelo workers do to get some simple justice? PGHC executives responsible for major social dislocation across our region thanks to the layoffs will be fine. They’ve got golden parachutes. PGHC shareholders will make some money in the sale to buyout firm Wynnchurch Capital. Wynnchurch will make plenty of money by reviving the Papa Gino’s and D’Angelo brands and selling them to the highest bidder, and/or by dumping the buyout debt on the company and making millions in “consulting” fees whether the company succeeds or tanks, and/or by gutting company assets for cash.

 

But what about the workers?

 

All I can say is what I say in pretty much every article I write about labor issues: Workers need to stand and fight. Wherever we are. Whatever our situation.

 

So, for the remaining Papa Gino’s and D’Angelo workers, you all need to unionize. To make sure you have at least the protection of a union contract in the likely event of more layoffs. And better wages, benefits, and working conditions while you all are still employed there. It won’t be easy. But you can be sure that at least two or three major unions—I’m guessing UNITEHERE, SEIU, and possibly UAW—are eager to get in touch with you. I recommend you work with the union that will give you the best service (in the form of staff dedicated to your group) and the most autonomy.

 

And for the laid-off Papa Gino’s and D’Angelo workers? You, too, need to organize. Get together. Talk things over. Get advice from some experienced union leaders and pro bono representation from some labor lawyers. Maybe find a way to sue your former bosses or the new owners for redress under the WARN Act or some other applicable law. Build community support the way Market Basket workers did a few years ago. Explain why it’s not acceptable for large companies to treat people the way PGHC treated you—and even less acceptable for government at all levels to let them get away with it. Raise money and awareness. Formulate demands. For severance pay. For extended unemployment benefits. For retraining. For damages. For whatever you all need to be made whole. Stay in close touch with your former colleagues as they try to strengthen their position.

 

Then figure out how to win some justice… together.

 

Fortunately, a Facebook page has been started to do just that. Called, fittingly, Papa Gino’s Workers’ Reparations. Here’s a short link for PGHC workers reading in print: tiny.cc/papajustice/. Check it out. And best of luck to all of you.

POPULAR NOT POPULIST: GOV BAKER CONTINUES TO POLL WELL WITH PEOPLE HE’S SCREWING

 

July 31, 2018

BY JASON PRAMAS @JASONPRAMAS

 

There is no area of Massachusetts politics where it is more baffling to contemplate Gov. Charlie Baker’s ongoing popularity in the polls than the annual state budget debate. One can only draw two conclusions from such musing: either people don’t get the budget information they need from Bay State press, or a majority of Commonwealth residents simply enjoy watching poor people get kicked to the curb. While corporations are encouraged to line their pockets with public funds in ways that hurt everyone but the wealthy.

 

At no time of year is the contradiction of Baker’s popularity thrown into bold relief more than late July when he issues his line item vetoes and other modifications to the legislature’s final budget.

 

And this year that contradiction is sharper than ever. Because the most visible victims of the governor’s last budget action look to be people on welfare—many of whom are single mothers with children.

 

So last week, Baker refused to agree to a budget policy section that would remove the “family cap” that stops families on welfare from being able to receive extra benefits for children born while they were on welfare. Instead he sent an amended version of the family cap section of the state budget back to the legislature.

 

As reported by MassLive, “That amendment would lift the family cap but also change welfare eligibility laws so that an adult’s Supplemental Security Income is counted when determining if a family is eligible for welfare. SSI is a federal payment given to severely disabled adults.” … “According to state figures as of last year, 5,200 children with a severely disabled parent would lose their welfare benefits entirely under the change, and 2,100 children would lose part of their benefit.”

 

By contrast, MassLive continues, “Lifting the family cap would make approximately 8,700 additional children eligible for welfare assistance.”

 

If the family cap policy section of the budget had simply been vetoed, it could have been overridden by a two-thirds vote of the legislature like any other veto. But since its language was amended and sent back to the legislature for action, they have to vote on it like a new bill. After which, Baker has 10 days to act on it. And since he sent it back to the legislature at the end of its current session, the end of the 10 days after any new bill passes comes after the session is over. So Baker can simply veto it, and supporters will have to wait until next session to go through the entire legislative process again.

 

Advocates from organizations like Mass Law Reform Institute and Greater Boston Legal Services are crying foul, given the heartlessness of the measure and the fact that it has taken years to get the family cap reform through the legislature.

 

As of this writing, the House has reinstated the original family cap language, and the Senate is expected to do the same. But Baker will almost certainly veto it within 10 days of passage as planned. After the legislative session has ended.

 

Which is a total drag, and exemplary of a backwards view of welfare as an “incentive” to “encourage” poor people to work. Language that Baker has used when explaining his position on the family cap debate—a standard conservative view, unfortunately shared by Republicans and many Democrats alike, that poor people are poor because of individual failings like “laziness,” not for any structural reasons beyond their immediate control.

 

But here’s another way to view welfare: People are poor because just as capitalism provides billions of dollars to a vanishingly small number of big winners like Jeff Bezos and the Koch brothers, it creates millions of losers who have to struggle endlessly to make ends meet. Meaning inequality is baked into our economic system. Without strong government regulation, capitalism is incapable of even blunting the brutal impact of such inherent flaws, let alone somehow fixing those flaws.

 

Part of that inequality comes in the form of job provision. Since the drive for people at the commanding heights of the capitalist system is always to maximize profits, their concomitant drive is to do so by slashing labor costs whenever possible. One way they have done this since the 1970s is by changing labor from a fixed cost—as it tended to be under postwar American social democracy when over 30 percent of the workforce was protected by government-backed union contracts and there was a reasonable social safety net (including welfare)—to a variable cost.

 

The result? As was last the case at the turn of the 20th century while a militant labor movement spent decades fighting the “robber baron” billionaires of that era for redress, bosses can hire workers when needed at the worst possible rates and push them out when they don’t need them. Often without even having to officially fire workers—which would allow them to collect unemployment for a few months. And the largely ununionized workforce has almost no say about the conditions of its employment, or job policies in general, outside of insufficient minimum wage laws, easily avoided health and safety laws, and a few increasingly weak civil rights laws that might get a handful of people reinstated on the same bad terms on the rare occasions when open discriminatory practices by employers can be proven.

 

So by converting stable decent-paying union jobs to unstable contingent jobs—like temp, part-time, contract, day labor, and independent contractor jobs—over the last 40 years, capitalism and the capitalists who run it have ensured the creation of a growing impoverished underclass. This vast group of poor people acts as a reserve army of labor that, together with vicious union-busting that is on the verge of killing the American labor movement, accelerates the downward pressure on wages. And ensures that the only jobs that most poor people can get are bad contingent jobs.

 

When poor people can’t put together enough of these precarious non-jobs to make ends meet, they turn to welfare. But the old “outdoor relief” programs that provided poor men with jobs, money, food, and other necessities in many parts of the country were eliminated long ago (as were New Deal-era public jobs programs), and the remaining welfare system that largely benefitted poor women and children was hamstrung by the Democratic Clinton administration in 1996. Not coincidentally, its prescriptions were first tested here in Massachusetts in 1995 by our completely Democrat-dominated legislature—presided over by a Republican governor, Bill Weld. A so-called “libertarian” cut from much the same cloth as Charlie Baker.

 

According to a 2008 report (“Following Through on Welfare Reform”) by the Mass Budget and Policy Center, the one-two state-federal punch to poor women and children in the Commonwealth predictably ended up significantly cutting already meager welfare payments by imposing time limits on assistance and by mandating the most cruelly ironic possible change, “work requirements.”

 

Why cruelly ironic? Because the work requirements forced people who were poor because the only jobs available to them were bad contingent jobs to prove they were “working” before getting the reduced welfare benefits still on offer.

 

The new system was in many cases literally run by the very temp agencies that played a key role in making people poor to begin with. The “jobs” forced on people to qualify for much-denuded benefits were often not jobs at all. Welfare applicants were just “employed” by such temp agencies—now recast as privatized social service agencies—and forced to wait for “assignments” that were low-paying and sporadic. But unless they “worked” a certain amount under this system, no benefits. It was a hardline right-winger’s wet dream made flesh. The same capitalist system that made them poor now kept them poor. And state and federal government were no longer in the “business” of helping offset the worst depredations of capitalist inequality in what we still like to call a democracy.

 

So this is what popular Gov. Charlie Baker is up to when he plays games with reforms like the family cap. He’s screwing people who get a few hundred bucks a month in benefits out of an extra hundred a month for another kid born while they’re jumping through every conceivable time-wasting bureaucratic hoop and working the same shit jobs that made them poor to begin with. Meanwhile, he’s finding new and creative ways to dump more millions in public treasure on the undeserving rich with each passing year.

 

And you like this guy, fellow Massholes?! Just remember, in a “race to the bottom” economy presided over by capitalist hatchet men like Baker, once the poor are completely crushed, the working class is next. Followed by the middle class. Maybe think that over next time a pollster asks your opinion of the man.

 

Apparent Horizon—winner of the Association of Alternative Newsmedia’s 2018 Best Political Column award—is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2018 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

‘DON’T MOURN, ORGANIZE!’

 

The Black Cat. Industrial Workers of the World symbol. Credited to Ralph Chaplin.
The Black Cat. Industrial Workers of the World symbol. Credited to Ralph Chaplin.

 

Why Janus might actually be good for the American labor movement

 

July 3, 2018

BY JASON PRAMAS @JASONPRAMAS

 

The Supreme Court issued a decision last week that will have profound consequences for American working people. In Janus v. AFSCME, the court overturned a 1977 decision, Abood v. Detroit Board of Education, that allowed public sector unions—like the National Education Association, the American Federation of Government Employees, and the American Federation of State, County and Municipal Employees—to charge government workers who refused to become members a “fair share” fee to defray the expense of representing them.

 

According to the Atlantic, “Until now, 22 states had in place a so-called ‘fair share’ provision, which required people represented by unions who did not choose to be members of these unions to pay fees to cover the cost of the unions’ collective bargaining activities. By contrast, 28 states were so-called ‘right-to-work’ states, and barred employers from including ‘fair share’ requirements in employment contracts.”

 

Private sector unions—although most large unions these days like Service Employees International Union represent both private and public sector workers—are also not allowed to collect “fair share” or “agency” fees in right-to-work states. The thing that makes this ruling so pernicious is that it expands that right-to-work mandate to cover public sector unions nationwide.

 

The understandable view of the majority of labor supporters is that Janus is a disaster for American unionism. Bankrolled by a rogues’ gallery of right-wing donors, its passage virtually guaranteed by the replacement of conservative Supreme Court Justice Antonin Scalia with another conservative, Neil Gorsuch, the decision is certainly going to have a negative impact on public sector unions. Which comprise the largest wing of the US labor movement of 2018. Private sector unions having already been beaten back by endless attacks from corporations over the last 50 years.

 

According to the US Bureau of Labor Statistics, the union membership rate of public sector workers (34.4 percent) continued to be more than five times higher than that of private sector workers (6.5 percent) in 2017. With only 10.7 percent of American jobs unionized overall, and public sector union members outnumbering private sector union members since 2009.

 

This low “union density” rate is no accident, as big business wants to eliminate unions as an impediment to their endless drive for profit. Since unions have the strongest track record of any institution in our society of keeping the pressure on employers and government for higher wages, better benefits, and more spending on government programs that benefit working families. Just the sorts of things that lower corporate profits.

 

But public sector unions have been better protected than private sector unions—organizing jobs that are generally directly funded by government at all levels. This has made them a primary target of the right wing—for whom giving unionized government workers a better deal over decades is tantamount to using public funds to expand the government.

 

Also, public sector unions—like most other unions—provide tens of millions of dollars to the Democrats every election cycle, and most of the ground troops the Dems need to run successful election campaigns in many districts.

 

For those reasons, right-wing strategists have been looking for ways to get rid of public sector unions since they rose to prominence in the mid-20th century. Even more than the private sector unions they’ve had an easier time busting. And Janus moved them a long way toward that goal by cutting into union bottom lines.

 

How? Fair share fees add up. Eliminating them for public sector unions nationwide will cut millions of dollars from their budgets. Effectively slashing the amount of money they can spend on organizing new workers and plumping up Democratic Party coffers. Even though the Aboud decision dictated that fair share fees could only be spent on “collective bargaining” costs—basically, providing nonunion government workers the same services provided to union members—not on political activity.

 

No surprise, then, that many union leaders and boosters think this is the worst anti-labor decision by the court in decades.

 

However, there’s a minority view on the left wing of labor—where I have always situated myself as a longtime union member and activist—that says that the Janus decision may actually save American unions. Why? Two reasons.

 

First, because the more money that American unions have raised from members and nonmembers alike, the more they have tended to bureaucratize. And become top-heavy with high-paid staffers and elected officials that have become culturally distant from those same members.

 

Because union leaders making secure six-figure salaries with generous benefits have very little in common with members making typical union wages. They are also more likely to be college educated than union members are. A phenomenon that’s been growing (ironically) since the radical campus movements of the 1960s produced a generation of student activists who entered union jobs—and staff positions— in an effort to push them to the left politically. After the communists, socialists, and anarchists who actually built many unions through titanic workplaces struggles between the turn of the last century and the 1940s were pushed out of them during the anti-left “witch hunts” of the McCarthy Era.

 

Today’s union leaders therefore are not like the leaders of those earlier struggles. They’re often more comfortable with the college-educated corporate and government leadership sitting across from them at the bargaining table than they are with their own members. And they’ve tended to replace militant grassroots organizing on behalf of the entire working class with narrow bargaining for minor contractual gains for the shrinking number of members they represent. Such leaders make tough-sounding noises when it’s time to get a new contract with an employer or during big election campaigns. Yet they’re actually quite timid compared to their predecessors—who were often on the front lines of literal street battles with police and the National Guard or in jail on trumped-up charges when union activity was deemed illegal by courts stacked with pro-corporate elites.

 

Second, as this timidity in an era of renewed vicious corporate assaults against labor has contributed to declining union membership rolls as a percentage of the growing population, union leaders have turned to spending larger and larger sums of money on the Democratic Party. In a mostly vain attempt to purchase political clout they no longer have in the streets or at the ballot box. Even as the Democrats have moved steadily to the right since the 1970s, and become more and more beholden to corporations. Which still makes the Republican hard right angry enough to fight for court decisions like Janus, since the now slavishly pro-corporate Democrats are insufficiently capitalist by their lights. And, more to the point, since the Republicans have a strong desire to rule—a “will to power,” one might say—and any force that opposes them is an enemy that must be defeated. An attitude that hapless Dem leaders have definitely adopted to anyone to their left, including the social democratic pro-union left of their own party. But have failed to adopt to the Repubs and the outright fascists on their right.

 

So, Janus might be just what’s needed to cause a rebirth of the labor movement. It eliminates a big chunk of the money that union leaders have to spend on the Democrats—who have done little more than take that money and spit on union workers since the neoliberals of the Clinton administration took over party leadership.

 

It also will force the unions to cut staff. Including top staff. Which will definitely dump good leaders as well as bad ones, and that’s a drag. But it might very well help with the other big problem American unions have—a lack of internal democracy. Like other bureaucracies, too many unions have come to vest too much power in their top echelons. And leave their members out in the cold. Which is another factor that has led to union leaders making bad political decisions. Like backing pro-corporate Hillary Clinton over pro-labor Bernie Sanders in 2016.

 

Budget cuts caused by Janus could cause more power to be vested in union memberships’ hands. Leading to more victories like the one won recently by unionized teachers in West Virginia—who organized massive wildcat strikes over the protests of their own leadership. And won big while lighting a fire that has spread to teachers in other “red” states like Oklahoma and Arizona. States that are, among other bad things, right-to-work states.

 

However things play out, moribund American union leadership has been in need of a wakeup call for decades. And if Janus is what it takes to shake them out of their torpor, then so be it.

 

In any case, as storied labor martyr Joe Hill once said, “Don’t mourn, organize!” But don’t expect to win gains in the workplace and at the ballot box without a real fight—and without unions controlled by their members top to bottom.

 

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2018 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

GRAND SCHEME

workers protesting

 

Mass legislature helps, harms workers in “deal” with labor and business lobbies

 

June 26, 2018

BY JASON PRAMAS @JASONPRAMAS

 

No sooner did the Supreme Judicial Court shoot down the “millionaires’ tax” referendum question last week than the Mass legislature rammed a so-called grand bargain bill (H 4640) through both chambers. A move aimed at shoring up tax revenue threatened by the Retailers Association of Massachusetts referendum question that is virtually certain to lower the state sales tax from 6.25 percent to 5 percent if it should go before voters in November.

 

The house and senate did this by rapidly completing the brokering of a deal that had been in the works between pro-labor and pro-business forces on those issues for months. Giving each side something it wanted in exchange for encouraging the Raise Up Mass coalition to take its remaining two referendum questions—paid family and medical leave, and the $15 an hour minimum wage—off the table, and the retailers association to do the same with its sales tax cut question. Both organizations have not yet made the decision to do so.

 

If passed, the so-called grand bargain bill will give labor watered-down versions of its paid family and medical leave and $15 an hour minimum wage ballot questions, and give business something that’s explicitly anti-labor: the end of time-and-a-half wages for people working Sundays and holidays, and their ability to legally refuse to work Sunday and holiday shifts.

 

While Gov. Charlie Baker still has to sign the bill, as of this writing it’s looking like he will do so. Soon.

 

Which is a pity because it’s not such a great deal for working people as written. True, the grand bargain does ensure that the state minimum wage will raise to $15 an hour for many workers. But it moves up to that rate from the current $11 an hour over five years, instead of the four years it would take with the referendum version. Plus it betrays tipped employees, whose wage floor will only rise from a pathetic $3.75 an hour now to a still pathetic $6.75 an hour by 2023. Keeping all the cards in the bosses’ hands in the biggest tipped sector, the restaurant industry. Although it’s worth mentioning that even the referendum version of the $15 an hour wage plan would have only raised tipped employees to $9 an hour. When what’s needed is a single minimum wage for all workers.

 

It also makes Massachusetts one of the first states in the nation to institute paid family and medical leave for many workers. Which is truly a noteworthy advance. Yet again, the referendum version is better for workers than the grand bargain version.

 

But legislators gave away another noteworthy advance from 20 years ago in the process: time-and-a-half wages for many employees who work on Sundays and holidays. Which will hurt some of the same people who the new minimum wage and paid and family medical leave will help.

 

Thus far, the labor-led Raise Up Massachusetts coalition has had mostly positive things to say about the deal. However, the main union representing supermarket workers—many of whom currently take Sunday and holiday shifts—is already vowing to torpedo the grand bargain. Even though their union contracts also mandate time-and-a-half pay for working Sundays and holidays. And they’ve resolved to take down legislators who backed it over their protest.

 

Jeff Bollen, president of United Food and Commercial Workers Local 1445, minced no words on the subject in a recent video message to his members:

 

“I am really pissed off at our state legislature for stabbing retail workers in the back by taking away time and a half on Sundays and holidays for all retail workers in Massachusetts.


“Remember, it was this local union in 1994 with big business and the retail association wanting to get rid of the blue laws; so they could open up their supermarkets, their big box stores, and their liquor stores and make money on Sundays that we fought hard to get a law passed to protect you, the retail worker. And we did.”

 

The supermarket union leader went on to explain that state lawmakers “panicked” when the millionaires’ tax was derailed and pushed through the grand bargain to avoid losing any more revenue from the referendum question to lower the sales tax. He swore the union was “going to remove those individuals that voted against you. We’re going to get them removed and replaced with pro-labor legislators who are going to fight for the rights of working people.” And defiantly concluded: “We’re going to continue to fight. We’re going to continue to try to get this whole thing repealed.”

 

How much support the UFCW can expect to get from the rest of the labor movement remains to be seen. But the fact is that some Bay State working families are going to suffer nearly as much pain as gain from the grand bargain.

 

Worse still, there’s a deeper problem with the bill. It potentially stops the retailers’ referendum drive to lower the sales tax—which they’ve definitely put on the ballot to ensure that big businesses make more profits. But it must not be forgotten that the sales tax is a regressive tax that disproportionately harms working families. And even though the state desperately needs money for many programs that help the 99 percent, it remains a bad way to raise funds compared to a progressive tax system that would force the rich to pay higher tax rates than everyone else. Like the federal government has done for over a hundred years.

 

Yet since the rich and their corporations continue to rule the roost in state politics, and since a state constitutional amendment would be required to allow a progressive tax system in Massachusetts, there is no way that is going to happen anytime soon. As I wrote last week, the millionaires’ tax would have at least increased the amount of progressivity in the tax system had it been allowed on the ballot (where it was projected to win handily). But business lobbies got the SJC to stop that move.

 

Given that, the revenue lost from a sales tax cut would really hurt in a period when many major state social programs are already being starved for funds.

 

Nevertheless, many working families will take a big hit from the grand bargain bill as written: They’ll see the full introduction of the $15 minimum wage delayed by an extra year, they’ll get a worse version of paid family and medical leave, they’ll lose time-and-a-half wages on Sundays and holidays, they’ll see the sales tax remain at 6.25 percent… and if they’re tipped employees, they’ll still be made to accept a lower minimum wage than the relevant ballot question would get them and still have to rely on customers to tip them decently and their bosses to refrain from skimming those tips.

 

So, it would behoove Raise Up Massachusetts and its constituent labor, community, and religious organizations to stay the course with the paid family and medical leave and $15 an hour minimum wage referendum questions that are still slated to appear on the November ballot. And pro-labor forces should also be ready to lobby harder for a better deal should Gov. Baker refuse to sign the grand bargain bill.

 

Of course, it could very well be that the bill will be signed into law before this article hits the stands, and that labor and their allies will throw in the towel on their ballot questions. And that would be a shame.

 

Here’s hoping for a better outcome for Massachusetts workers. Even at this late date.

 

Note: Raise Up Massachusetts announced that it had accepted the “grand bargain” bill shortly before this article went to press on Tuesday evening (6.26), according to the Boston Business Journal.

 

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2018 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

CAPITALIST VETO

Money tips the scales of justice image

 

Popular “millionaires’ tax” referendum question blocked by a pro-business SJC

 

June 19, 2018

BY JASON PRAMAS @JASONPRAMAS

 

The Fair Share Amendment—better known as the “millionaires’ tax”—that would have gone before voters this November as a statewide referendum question was shot down this week by the Massachusetts Supreme Judicial Court (SJC). So the effort to increase taxes on people making $1 million-plus a year and spend the resulting funds on social needs is over. For the moment.

 

Organized over the last three years by Raise Up Massachusetts, a major coalition of labor, community, and religious organizations, the initiative had the support of two-thirds of Bay State voters in recent polling and had a good shot at passing.

 

The campaign was spearheaded by the Commonwealth’s two largest unions, Service Employees International Union and Mass Teachers Association. And naturally, most Massachusetts rich people had no intention of letting anyone—let alone a bunch of union leaders, social workers, and priests—raise their taxes.

 

Flunkies and front groups were then unleashed. The Massachusetts High Technology Council put together a bloc of capitalist lobby groups—including the Massachusetts Taxpayers Foundation, Associated Industries of Massachusetts, and the Massachusetts Competitive Partnership—and challenged the amendment’s constitutionality.

 

They were aided in this push by the fact that Gov. Charlie Baker, a Republican, was able to appoint five of seven justices to the SJC since taking office in 2015. Including one that, in fairness, wrote the dissenting opinion on the Fair Share Amendment ruling.

 

Thus, it was no big surprise that the SJC shot the millionaires’ tax down on a legal technicality. Since the wealth lobby had no convincing political argument against the tax beyond “we don’t want to pay it.” But they had high-powered lawyers, plenty of money, and a court stacked in the right direction. Theirs. A capitalist veto in the making.

 

Professor Lawrence Friedman of New England Law | Boston explained the decision succinctly on a special edition of The Horse Race podcast—hosted by Lauren Dezenski of Politico Massachusetts and Steve Koczela of the MassINC Polling Group:

 

“What a majority of the court concluded was that this petition didn’t satisfy the requirements of article 48 [of the Mass constitution] for a valid petition that can go before the voters in November. Because it failed what’s called the ‘relatedness’ requirement—the various parts of the petition didn’t relate to each other sufficiently to pass constitutional muster.

 

“So the three parts of the petition involve the revenue raising measure, the so-called millionaire’s tax, and then two distinct dedications—one to education and one to transportation. And the court essentially said that, except at a very abstract level, those things are not sufficiently related to satisfy the relatedness requirement.”

 

The minority of the court, for their part, had a very different view. According to Justice Kimberly Budd (joined by Gov. Deval Patrick appointee Chief Justice Ralph Gants, and pardon the legalese here):

 

“Disregarding the plain text of art. 48, The Initiative, II, § 3, of the Amendments to the Massachusetts Constitution, as amended by art. 74 of the Amendments, which requires that an initiative petition contain ‘only subjects … which are related or which are mutually dependent,’ the court concludes that, in drafting this language the delegates to the Constitutional Convention of 1917-1918 inserted the words ‘or which are mutually dependent’ as superfluous text. … The court goes on to conclude that the people may not express their opinion on a one section, four-sentence petition because it contains subjects that are not related. … That analysis is flawed.”

 

In plain English, to rather brutally paraphrase further remarks by Friedman on The Horse Race, activists amended the state constitution a hundred years ago to allow the people of Massachusetts to make laws by referendum because even then the legislative process had been captured by corporations and the rich in ways perhaps unforeseen by John Adams when he drafted the document in 1780.

 

To block the Fair Share Amendment referendum from going on the ballot for a vote is therefore not in the spirit of the sentence at the core of the SJC majority’s case. The court’s pro-business majority focused on the “relatedness requirement.” Its pro-worker minority countered that referendum questions that contain “unrelated” items that are “mutually dependent” pass constitutional muster. But with five votes to two, the majority prevailed.

 

The result? The tiny percentage of Mass residents who make more than a cool million a year will not see their state taxes rise from 5.1 to 9.1 percent. And the estimated $2 billion that was expected to be raised from that levy annually will not be applied to the Commonwealth’s education and transportation budgets. Both areas that are ridiculously underfunded given our state’s wealth relative to much of the rest of the nation.

 

Worse still, the spurious myth that the Mass capitalists’ “coalition of the willing” flogged—and continues to flog in the case of the Boston Herald’s ever fact-light columnist Howie Carr—that rich people leave states that increase their taxes will continue to seem like reality to less careful onlookers of the local political scene. Despite the fact that a major study and a book entitled The Myth of Millionaire Tax Flight: How Place Still Matters for the Rich by Stanford University sociology professor Cristobal Young have used big data to dismiss the idea as mere scaremongering, according to Commonwealth magazine.

 

Now Raise Up Massachusetts has two options: 1) start the referendum process all over again with language that will pass muster with the narrowest and most conservative interpretation of the “relatedness’ requirement,” or 2) take the fight to the legislature.

 

With the chances of the legislature passing any kind of tax increase being approximately zero as long as Robert DeLeo is House speaker, starting the referendum process again from scratch is pretty much the only way to go.

 

Unless Raise Up leaders decide to make some kind of “deal” with the legislature. Which I sincerely hope is not the case. Because the whole Fair Share campaign is already a major compromise given that the real goal of any forward-thinking left-wing reformer in this arena has to be the repeal of article 44 of the state constitution that prohibits a graduated income tax system. Followed by the passage of such a system.

 

While I’m well aware that every attempt to do that has been defeated in the past, I’m also aware that if referendum questions aimed at the much broader goal of winning a fair tax system were on the table, then it would be possible to negotiate for something smaller like the “millionaires’ tax” if the effort ran into trouble.

 

As things stand, Raise Up Mass appears to have little room to maneuver. So, better to start preparing for a win in 2022 on an improved referendum strategy—preferably aiming for a graduated income tax to replace our anemic flat tax system—than to make a bad deal merely to be able to declare a false “victory” to its supporters and switch its public focus to the two other drives it still has in play: paid family and medical leave, and the fight for a $15-an-hour minimum wage.

 

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2018 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.