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Sam. Saint gonna change. Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives. Our jobs, our incomes, our debts, the prospects for our kids in just those same dimensions. I'm your host, Richard Wolff. I've been a professor of economics all my adult life, and currently I'm a visiting professor at the New School University in New York City. I also want to direct you to the websites that we maintain even before we jump into today's economic updates, because I want to remind you to use them and make use of them. We update them on a continuous basis every day of the week. They contain a great deal of material that amplifies and extends what we do on this weekly program. They archive this program. You can go back and listen to any of our weekly programs, but simply going to these websites. And finally, they allow you to follow us on Facebook and Twitter to communicate with us about what you like and don't like about the programs. So there's really a wealth of material on these websites. They're available 24 7, whenever it's most convenient for you, and there is no charge whatsoever to do so. Here they are. First, democracy at work. Democracy, that's all one word, democracyatwork.info and the other one is rdwolf, that's me. Rdwolff, with two Fs.com easy, simple, available for you. Make use of them. Let's jump then into the updates for this early time in 2016. I want to begin by kind of telling you a theme that's going to be working today, and that's what's happening on the extreme right wing of an economic system we live in because it's something we need to pay attention to because it's part of the story. And that right wing shows up in virtually everything we're going to do today, with the exception of the interview. So let's begin by complimenting some people that are fighting against that right wing in economics 2. In particular, I want to single out first, a group of workers called junior doctors. They comprise about one third of the medical system in Great Britain, in the United Kingdom, and they've been on strike this last week. And they're striking against the David Cameron Conservative government in the United Kingdom, which is part of a Conservative backlash against the extremely successful National Health Service in Great Britain. You see, they have in Great Britain what we do not have in the United States, a national health insurance that covers everybody. They do for all citizens in their country what we barely do for those over 65 here in the United States. But conservatives would like to privatize. They would like to have a private enterprise system, you know, the way we do here in the United States where we have the most expensive medical system in the world. Even though our medical outcomes are mediocre, better than some, worse than others, we pay a great deal more. We don't get any more than what other people do. The British haven't gone down that road. But Mr. Cameron would like to see them. And he goes after the National Health Service every way he can. And one of them is the tried and true mechanism of the right hobble, cripple and undermine a public service in order to get the public angry at it. Then use the public's anger at the service as an excuse to get rid of it altogether, rather than admitting that the reason the public is unhappy is that you haven't funded it properly, taxed the rich to make it feasible to do it in an appropriate way. So my hat's off to the junior doctors of England because they won't play ball. They will not go along. They are proud and able to go out on strike and say, we are not going to allow you to get away with the destruction of something that has served so many of of Britain's citizens for so long so successfully. You're not going to wreck it. You're not going to make our lives impossible so that we are exhausted and can't deliver proper health care. None of it. We're going to strike and permit none of that to happen. That's strength, that's commitment. The strike has been overwhelmingly successful with a clear majority of the junior doctors honoring the strike. They only do emergency work that of course they do to make their case clear. And it is an important pushback against a right wing agenda in Great Britain. The second group I want to complement, and I mean that quite sincerely, are public school teachers in Detroit, Michigan. They did an interesting thing. It's not a strike, it's a sick out. It's sort of a around the corner strike. Half a strike. It's a measure taken by concerned teachers in the public school system of Detroit, Michigan, a city that has been plagued by the right wing's agenda of undermining the needs of the majority. Allowing private corporations like General Motors, Ford and Chrysler to basically abandon that city to make more profits someplace else producing cars and trucks and not to pay any of the costs of the economic devastation they have caused. I could go on. I've talked about Detroit on this program before. But what's interesting is that one of the victims, of course, of this right wing business assault has been the refusal of the Governor of the state of Michigan and other politicians put in place by those same corporate interests to help in anything like the way that's needed. Instead they make cost cutting decisions. I'm going to have about three something to tell you about another one in the Detroit area in a few minutes. But what they've cut is the schools. Therefore public schools are overridden with rats. They have falling walls and ceilings. The descriptions in the press, the Detroit Free Press, among others, are stunning as to the dilapidation and the fact that huge numbers of kids are crammed into single rooms with individual teachers in these unspeakable conditions. Well, the public school teachers had enough. And in tens and dozens of schools across Detroit they called in sick this last week in order to make it public. And boy does that work. When finally workers get up and say no, the media pay attention. The public becomes aware in a way it can't any other way that there's something seriously wrong. That takes courage, that takes sacrifice and that deserves the honor that I want to bestow by giving them a shout out the way I did with the junior doctors in England. Well, as another example of extreme right wing economics, we turn to Detroit. This time it's something that was brought to my attention by the documentary filmmaker Michael Moore. It has to do with a suburb of Detroit, Flint, Michigan. Turns out that Flint, Michigan used to use the public water system of Detroit by arrangement with the city. And that's based on the Great Lakes water that is in the end melting glaciers that feed that system. Well, to save money, the government in Detroit and Flint and in the statehouse in Michigan decided you could save money in economic trouble times. That's how this language works. By not providing Flint with water from Detroit, but by the cheaper option of using water from the Flint River. Problem that over the decades the automobile companies and their feeder corporations have dumped unspeakable toxic materials into the Flint river as corporations have fouled so many of the rivers across the United States. And that led to there being unhealthy levels of lead in the water. Children got sick, people in Flint began to complain, no one paid attention. Money saving, financial fiscal austerity had the rule of the day. It finally got so bad it blew up. And now Michael Moore is calling for the arrest of the governor, Mr. Snyder in Michigan for failure to do the most elemental thing. It turns out that after months there's long term illness of high lead levels that has been dumped on the children who are particularly vulnerable of Flint, Michigan. What a story about the uncounted costs of the quote, unquote austerity. That is a fancy term for shifting the burden of a dysfunctional economic system on those least responsible for its dysfunction. And, and already the victims through economic downturn, now they're told they have to suffer medical expenses for the rest of their lives. This is not a story, folks. This is about right wing economic thinking prevailing from the corporation on over to the political leadership that does its bidding so often and so readily. Well, keeping with my theme, here's another place where right wing economic ideology is playing itself out. In this last week there have been discussions before the Supreme Court of the United States. And these discussions reveal the same story from yet another angle. This time it is a struggle between a schoolteacher in California and the schoolteachers union in California. And in order to understand this, I have to give you a bit of a background. The law in the United States, ever Since the late 1940s, the Taft Hartley law that was passed then, the law requires that in every workplace where there's a union, even though the members of the workforce there may or may not be required to join the union. In the vast majority of cases in this country, even if there's a union in your workplace, you as an individual worker are not required to join the union. But this law says that whether or not you join the union, anything and everything won by the union from the employer must be given to all the workers there, whether or not they join the union. Well, you can see if you're not very slow, what's involved here. This was a law, the Taft Hartley bill, enthusiastically supported by the business community and opposed by the labor movement. The labor movement lost that one. The business community got it. Why would they care? Well, the answer is obvious. The more you guarantee that a worker gets anything a union wins, the more you appeal to that worker to consider becoming a freeloader, a free rider, right? You don't have to join the union. You don't have to pay dues out of your salary for the union. You don't have to do what the union asks you to participate, go to meetings, go on strike. You don't have to do any of it and you'll still get whatever the union wins. That's the law. This was a way of giving an incentive to people not, not to join a union, not to pay the dues, not to support. Well, what did the unions do? It took them a while, but they came up. It took years. They Came up with a midpoint. Okay, they said you're not going to have to join the union, we'll leave it with that. But you really can't expect the union to go out there, struggle for improved workers wages and benefits and not pay any of the costs of doing that. The union office, the union negotiator, the union, the suffering of the people who go out on strike to get a better wage. So they came up with a midpoint was called agency fee. You don't have to join the union, but you do have to pay a fee, usually less than union dues. A fee that at least compensates the union for the work it does in collective bargaining with the employer that improves your labor conditions and your wages. The case before the Supreme Court is to dismantle that, to go back and say that the worker who chooses not to join, the worker who chooses not to participate in the union should, that's what the Friedrich's complainants are saying, should be free not to pay an agency fee either. That is, they want to go back and give a complete freeloader free rider status to the workers who don't want to join a union. So they get the benefits and they bear none of the costs. And it looks from the week's hearings in front of the justices and what the justices said from the reporters, recordings of it all, that they're going to vote in favor of this case. That's right. They're going to say that we live in a country where you don't have to pay anything at a workplace. And of course what that means is that you'll have an easy opportunity for the employer to persuade the employee not to participate, not to pay the dues. This hobbles, of course the union, weakens the union, makes it less able to struggle with the employer. In the end, this will hurt the people who don't pay either because they won't get the benefit since the union can't win them. And if it's hobbled in this way, it's a transparent move by the business community to weaken the labor movement one more step. And that's the last step of the story. Over the last 50 years, since the Taft Hartley act of 1947, unionization has been on a 50 year uninterrupted decline. In the private sector, which is where most American workers now work. The level of unionization is under 7%. That's right, you heard me correctly. Over 93% of all workers in the private sector in the United States are not members of a union. Are not represented by a union and are not covered by a union contract. Only 6.8% roughly are. It's a lot better in the public sector. In the public sector, there's almost 25 to 30% of the workers are organized still, of course, a minority. The majority are not. But a strong minority. This legislation, the Taft Hartley act and now this debate in front of the Supreme Court is meant to weaken the one area where labor is still strong labor movement, public sector workers. Where this agency fee is, is found most of the time. That's why the teachers are on the griddle right now in front of the Supreme Court. But all public sector workers ought to pay attention because this threatens your union, your ability to have an advocate pushing for better wages and working conditions at a time when the political structure working hand in hand with the corporate leadership, is trying to cut government, cut government spending, cut government programs all around you, as you do well know. Last point. Corporations continue to be dominant in the political games, funding the candidates of their choice in every way that they can. So it's important to know that there is also a fight back. Just as it was important to recognize the junior doctors in England and the Detroit teachers taking courageous sickouts to make an important point, there's also an interesting effort in California that strikes me as a sign of tensions and conflicts that are to come. It's called the Voters Right to Know ballot initiative. If I'm correctly informed, it is based particularly in San Jose, California, but it is a statewide effort collecting signatures these days, having until I believe, 4-15-20 to do it, to give the people of California a chance to vote on whether or not they want more information about what financial interests are playing what kind of role in the political contests of their society. This is an important struggle to watch, to see if similar things are going to be done in other parts of the United States, whether the effort to limit at least the influence of big money in our politics is mounting as we talk. All right, let me turn now, in the time left in this first half of the program, to a topic that we discussed last time because you were so interested in it and asked me to talk about it. This has to do with the funding of churches and other religious institutions here in the United States, and I wanted to make the point, because you've asked me to, that yes, indeed, religious institutions in this country are highly subsidized. That is, the government provides all kinds of financial supports to religious institutions. So for some of you who may have imagined that subsidies are something that the government does to Help, for example, poor people or unemployed people or folks on food stamps. Indeed, the government helps those, but those are by no means the only beneficiaries of government help. There are lots of others. And one of those not often discussed, because there's a kind of taboo about talking about this, although not here on this station and not on this program, there's a taboo about discussing whether religions are subsidized by government. So let me explain to you, Crystal, clearly how and why. The answer to Are they subsidized by the government? Is a loud, clear, emphatic yes, they are. There are three major ways that institutions, mosques, synagogues, churches, temples and so on are subsidized. And in the United States right now, the first one we discussed last week, if a church or a mosque or a synagogue or any religious institution is fortunate enough to have money, perhaps given by their members of their parish or their community, or donated by some wealthy person or left to them in someone's will, and all of these institutions make efforts to acquire such assets. If they have those assets and they use them to buy stocks and bonds to have an endowment, they often call it a portfolio, then they are blessed by the United States government and by every one of the 50 state governments with the following if you are a religious institution, the dividends and interest you earn from the stocks and bonds you may hold pay no income tax. If you're an individual and you have stocks and bonds, you have to pay an income tax on the dividends and interest you earn. But if you're a church or a temple or a synagogue or a mosque, you do not have to. You are relieved of the obligation of paying taxes. That means that the government, which serves you, too, the federal government looks after the air you breathe, the water you drink, it maintains the roads you need to allow your parishioners to get to and from your institution, don't they? And you need all the services you want to be able to hire people that are educated in the public schools. So the government needs to do things from which you benefit. But unlike businesses and unlike individuals, you don't have to pay the taxes needed to provide the services to you use. That's a special subsidy. But it's only the first of three. Here's the second one. If a church or mosque or temple or synagogue owns property, by which I mean the land on which their institution sits, the building in which they conduct their religious activities, equipment in the building, like computers, fleets of cars or trucks or buses that they maintain for their activities, whatever property they have is Here we go again. Exempt from taxation. So take a church, say, located in Middletown, anywhere, America. It relies on the local police department if they have need of them, or the local fire department if they have need of them, or, or the local health department to keep the sewers clean, you name it. But unlike the businesses and residents of Middletown anywhere, the church and the synagogue, they don't have to pay any taxes for those services. They get those services from the government for free. And now let me explain what you probably already understand. If the federal government cannot tax the the income that churches have from their stocks and bonds, if the local government cannot tax the property that the church or the synagogue or the mosque has in the local community, but they still have to deliver all the services to them, then someone else has to pay for the services delivered to the churches because they don't pay. And that someone else, friends, is you. The businesses and the individuals of America pay extra property taxes, state taxes, government federal income taxes in order to deliver services for free to religious institutions. If you are not a religious person, you are being taxed to sustain the institutions of interest to religious persons. You need to understand that. But I said there were three ways. There's another one, and in some ways this is the biggest. It turns out that if you are wealthy and you have enough money to give a nice big donation to whatever church you prefer, or whatever synagogue or mosque or temple, the government gives you yet another subsidy. Here's how it works. Let's suppose I'm wealthy and I give a million dollars to a church in my community. I am allowed to deduct the million dollars I give to a church from my taxable income so that I don't have to pay taxes the way I had to before I gave such a gift. So, for example, and by the way, there are people like this. Suppose my income is a million dollars a year from the good job I have. That would put me in the top 1% of Americans. I earn a million dollars. Now, suppose I'm very rich. I've accumulated money over my lifetime. And so I give a million dollars worth of stocks and bonds to a local church. I'm able to take the million dollar gift I give to the church, the donation, and deduct it from my income tax. Well, let's see. I got a yearly income in 2015 of a million dollars. I gave a contribution to the church of a million dollars. Therefore, for tax purposes, my income in 2015 was zero. I owe no taxes to the government. Wow. If I hadn't given that contribution If I wasn't rich enough, I would have had to pay half a million dollars on my million dollar salary. When you add up federal, state and local taxes, once again, everybody who doesn't give money to a church is having to pay more to make up for the government's loss of revenue from the donors who do give. Either the government losing the money of people who give to churches will cut services to you and me, or they will charge us more in taxes to make up for what the donors to religious institutions give. Do you understand those are ways of subsidizing churches? And let me leave you with this. If the separation of church and state means really anything, how is it possible that the state subsidizes churches? Are you really comfortable with that? Is it reasonable to say to people who are religious and want to have a religious institution, you don't need to pay for the institution you want to go to, you want to participate in? Why have we not decided to make religious institutions depend for their sustenance on the communities they serve? Why are we all required to subsidize a religion? Religious institutions that a majority of Americans probably never set foot in talks about political power, doesn't it? Well, folks, we've come to the end of the first half of our program for today. I want to thank you for listening. I want to remind you of those websites that we talked about. I want to remind you also that we are always looking for more and new radio stations carry this program and indeed places for me to give public talks so I can meet those of you that hear this program. And you can meet me if you have any suggestions along those lines, use our websites to contact us. Otherwise, please stay tuned. We're going to have a short musical interlude or an announcement from your station and then we will be right back.