WHY RAILROAD WORKERS WERE THREATENING TO STRIKE

As you’ve probably heard, railroad workers were threatening to strike and may still do so if they don’t feel the tentative agreement is good enough. What you probably haven’t heard much about is why they were threatening to strike.

(Note: If you find my posts too long or too dense to read on occasion, please just read the bolded portions. They present the key points I’m making and the most important information I’m sharing.)

The railroad corporations, through consolidation, deregulation, and practicing extreme capitalism, have gain so much power that they have been making life miserable for their employees. They have also been a major contributor to the supply chain problems in the post-Covid period and to the high levels of inflation. One of the reasons it was so important for the Biden Administration to step in and negotiate a proposed settlement was that a strike would have further disrupted continuing supply chain problems and exacerbated inflation.

Since 1980, through mergers and acquisitions (that our government has failed to stop under antitrust laws), the 40 major railroad corporations have become six (Burlington Northern and Santa Fe [BNSF], Union Pacific, CSX, Canadian National, Norfolk Southern, and Canadian Pacific,) and four of them have roughly 85% of the freight business. [1]

Because the railroad corporations are focused in different areas, they operate with monopolistic power in much of their service territories. In 2012, 78% of train stations had service from only one railroad. This allows the railroad corporations to engage in the extreme capitalism that is running rampant in the U.S., generating huge profits by price gouging and aggressively squeezing labor and other costs. They have aggressively reduced surge capacity and redundancy to minimize costs, which have contributed to the bottlenecks and fragility in supply chains.

Deregulation has allowed the railroads to shed their obligations to serve the public, which were put in place after the robber barons of the late 19th century made fortunes from their railroads while running roughshod over the public interest. The railroads have dropped unprofitable routes leaving many small towns cutoff from efficient freight shipping. As a result, from 1980 to 2008, railroads reduced their miles of track by over 40%. Railroads are no longer required to treat similarly situated shippers equally; they can now cut special deals with big shippers putting small businesses at a disadvantage. Like the airlines, the railroads are increasing fees on customers, which some feel is a form of price gouging. In the third quarter of 2021, the railroads had doubled their fee revenue since the beginning of 2019 to about $800 million.

The profit margin in the industry (the percentage of revenue that is profit) soared from 15% in 2001 to 40% in 2021. In other words, for every $100 that the corporations received, $40 is now profit as opposed to $15 ten years ago. A big part of this increased profitability, is that the portion of revenue dedicated to paying employees has dropped from 34% to 20%, or, in other words, from $34 of every $100 or revenue to $20. [2] In 2019, the freight railroad industry was the most profitable industry in the country with a 51% profit margin. [3] As evidence of the high profitability of the railroad industry, all but one of the publicly traded railroad stocks outperformed the overall stock market over the ten-year period from 2011 to 2021. Union Pacific had the second-highest total return in the market over that period, rewarding its investors with an almost six-fold return, roughly a 20% gain each year.

These record profits are, for the most part, NOT being reinvested in the businesses but are being use to reward shareholders (including executives) through the buying of the corporations’ own stock and paying dividends. For the industry as a whole, these stock buybacks and dividends have totaled over $200 billion since 2010, averaging over $15 billion per year, and they are continuing. For example: [4]

  • Union Pacific: $5 billion in stock buybacks and dividends in the first half of 2022 from $22 billion in revenue and $6.5 billion in profits in 2021.
  • CSX: $3 billion in stock buybacks and dividends in the first half of 2022 from $12.5 billion in revenue and $3.8 billion in profits in 2021.
  • Canadian National: $2.3 billion in stock buybacks and dividends in the first half of 2022 from $11.5 billion in revenue and $3.9 billion in profits in 2021.

The railroad corporations have cut staff by one-third since 2016 and over 70% since 1980 as total employment in the railroad industry has dropped from 500,000 to under 135,000. This reduced workforce is generating more profits than ever for their employers but haven’t gotten a wage increase in over two years as their contract negotiations have dragged on and on. Train crews used to be five people but today are two. The corporations have even proposed reducing the number of engineers on a train from two to one, despite what would happen if a single engineer on a long freight train had a medical emergency with no one else onboard. This would be like having an airplane with no co-pilot.

Many have called the working conditions at the railroads inhumane. Workers’ schedules are often unpredictable. They do not have paid sick days or other leave. They are penalized if they take a day off to go to the doctor or deal with a medical need. The railroads are so thinly staffed that they can’t allow employees any flexibility and need to have them on-call at all times to keep the trains running.

The safety of the workers and the communities the trains run through is being compromised; in the rush to get more done with fewer workers safety inspections are being neglected. Since 2012, the rates of accidents, equipment defects, and safety incidents have climbed; there have been more fatalities even though the number of miles trains are running has dropped roughly 40%.

The new proposed contract, which involves 12 unions representing 115,000 workers, would:

  • Allow workers to take days off for medical care without being penalized, but only one of those days would be paid. (Union leaders had initially asked for 15 days of paid sick leave.)
  • Increase pay by 24% over five years, going back to 2020 when the last contract expired, bringing the average workers’ pay to $110,000 in 2024.
  • Provide more worker-friendly work schedules.
  • Keep workers’ health care premiums at current levels.

Union members will vote over the next couple of weeks on whether to accept the proposed contract. [5]

The railroads are a textbook example of the extreme capitalism our current laws allow. Corporations generate very large profits for shareholders (including executives) while workers get squeezed hard. Amazon and Walmart are other examples that jump to mind. Fortunately, the railroad workers are in a union so they have some power to fight back.

[1]      Buck, M. J., 2/4/22, “How America’s supply chains got railroaded,” The American Prospect (https://prospect.org/economy/how-americas-supply-chains-got-railroaded/)

[2]      Gardner, E., 9/13/22, “Rail strike by the numbers: Railroad profits are soaring at workers’ expense,” More Perfect Union (https://perfectunion.us/rail-profits-soaring-at-workers-expense/)

[3]      Buck, M. J., 2/4/22, see above

[4]      Stancil, K., 9/19/22, “While fighting workers, railroads made over $10 billion in stock buybacks,” Common Dreams (https://www.commondreams.org/news/2022/09/19/while-fighting-workers-railroads-made-over-10-billion-stock-buybacks)

[5]      Gurley, L. K., & Stein, J., 9/15/22, “Biden scores deal on rail strike, but worker discontent emerges,” The Washington Post

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WHAT PRO-LIFE REALLY MEANS

By John A. Lippitt, Ph.D., and Kirtly Parker Jones, M.D., OB/GYN

The Supreme Court’s overturning of the right to an abortion prior to fetal viability has put a spotlight on what it means to be “pro-life.” Right-wing Republicans declare that being “pro-life” means asserting that life begins at conception, i.e., fertilization. Therefore, they say, our laws should declare that a fertilized human egg is a person and should be given all the rights of personhood. If an individual believes, typically based on religious beliefs, that human (sacred) life begins at conception, they have every right to believe that, to lead their life based on that belief, and to try to convince others to live their lives that way. However, they do not have a right to impose that belief on others; that’s one important example of what a right to freedom of religion means.

(Note: If you find my posts too long or too dense to read on occasion, please just read the bolded portions. They present the key points I’m making and the most important information I’m sharing.)

A declaration in our laws that life and personhood begin at fertilization has many implications. It means, of course, that anything that prevents a fertilized egg from being born as living, breathing, presumably healthy baby is murder. It would criminalize some forms of contraception. Most forms of contraception primarily either stop ovulation (egg production) or prevent egg fertilization, but they can also reduce the likelihood of successful implantation of a fertilized egg, which could be considered murder. A personhood-at-fertilization law would make any miscarriage subject to a criminal investigation as to its cause. [1] Theoretically, the failure of a pregnant women to take steps to minimize the likelihood of a miscarriage could be criminalized, such as a failure to stop smoking, maintain a healthy weight, control diabetes, or cease use of alcohol and drugs, including some legal drugs.

Understanding the implications of a declaration that personhood begins at fertilization requires understanding the development of a pregnancy. Fertilization occurs in the fallopian tubes and it typically takes 3 – 4 days for the fertilized egg to reach the uterus. It then takes 2 – 6 more days for the fertilized egg to implant itself into the uterine lining where it will grow, assuming all goes well, for the next 38 or so weeks until birth.

Many fertilized eggs have abnormalities in their chromosomes. This means they cannot produce a viable fetus and typically die because they fail to successfully implant in the uterus or result in a miscarriage early in pregnancy. However, under a personhood-at-fertilization law, all deaths of a fertilized egg would be an illegal abortion and a murder.

Some fertilized eggs can get stuck in the fallopian tubes and an ectopic pregnancy results, which is life threatening if the embryo is not removed. But this would be an abortion and murder under a personhood law, unless a specific exception is included in such a law.

Overall, between a third and a half of all fertilized eggs do not implant in the uterus and therefore die. However, under personhood-at-fertilization laws, each such event would potentially be subject to a criminal investigation. This would also be true of any intentional or accidental destruction of a fertilized egg stored at a fertility clinic.

Somewhere between 7 and 9.5 million human eggs get fertilized each year in the U.S. Somewhere between 2.5 and 4.5 million of them don’t successfully implant in the uterus and do not lead to a viable fetus. Under proposed personhood laws, these would be considered abortions and potential murders, although in many cases the woman is not even aware that this has happened.

For medical professionals, pregnancy begins when the fertilized egg has successfully implanted itself in the uterus, roughly a week after fertilization. There are 4.5 to 5.0 million pregnancies in the U.S. each year. Roughly 18% of them are ended through intentional abortions, about 900,000 per year. A similar number, about 20% or 1 million, end through a miscarriage. [2]

If a person were truly pro-life (as opposed to anti-abortion), they would do everything they could to ensure that every pregnancy produced a vibrant, healthy baby. Prenatal and even pre-pregnancy care for women of child bearing age would be a priority. Furthermore, post-partum care for every baby and mother would be a high priority too, as would care and supports for children and their families from infanthood to adulthood.

An examination at the state level reveals that the six states that are most strongly anti-abortion (based on polls that find support for abortion rights is 49% or less) are the states with the worst records for supporting mothers and babies before, during, and after childbirth, despite the claims of at least their politicians to be “pro-life”. Indicators of their lack of support for mothers and babies include: [3]

  • Mississippi: ranks 50th among the states with the worst (i.e., highest) rate of infant mortality and ranks 45th worst on its rate of maternal mortality; it refused to expand Medicaid to cover more low-income families under the Affordable Care Act (aka Obama Care), despite the fact that Medicaid is the source of health insurance coverage for many low-income mothers and their babies
  • Louisiana: ranks 49th worst on infant mortality
  • Alabama: ranks 48th worst on infant mortality, 48th worst on maternal mortality, and refused to expand Medicaid
  • Arkansas: ranks 47th worst on infant mortality and 50th worst on maternal mortality
  • Oklahoma: ranks 46th worst on infant mortality
  • Wyoming: ranks 47th worst on its rate of women without medical insurance and refused to expand Medicaid

Conversely, polls find that in 14 states 70% or more of the population support abortion rights. In these states, support for mothers and babies is strong. All have implemented the Medicaid expansion and nine have enacted paid family and medical leave that includes coverage for when a new baby arrives. Another, less specific measure of support for parents, especially young parents, is the level of the minimum wage. Five of the six anti-abortion states listed above (Arkansas is the exception) have a minimum wage at the lowest level federal law allows, $7.25 per hour. On the other hand, 13 of the 14 states with strong support for abortion rights (New Hampshire is the exception) have minimum wages well above the federal $7.25 level. [4] By improving incomes and economic security, a higher minimum wage improves the well-being and outcomes of children, mothers, and families.

It’s hard to truthfully claim that you’re “pro-life” when you have high infant mortality, high maternal mortality, don’t provide health insurance to low-income mothers and babies, and/or maintain low wages for parents. As former U.S. Representative Barney Frank once quipped, many of these supposedly “pro-life” people seem to believe that “life begins at conception and ends at birth” at least from a public policy perspective.

Being pro-life should mean being pro-child, and also pro-parent and pro-family. Pro-child state and federal policies would support health, food, and nutrition benefits for mothers and children; a living wage for parents; affordable, high quality early childhood education and child care; and so forth. Being pro-life should mean being pro-mother and pro-woman, making contraception readily available, and leaving the decision about terminating a pregnancy to a woman and her doctor. To be truly and morally consistently pro-life, one would also have to be against capital punishment and war. Some people are consistently pro-life but many of those who claim to be “pro-life” are not.

The far-right won a battle in the culture war when they framed their anti-abortion stance as “pro-life” and the pro-abortion people lost when they used “pro-choice.” The pro-abortion folks should have framed their stance as pro-child and pro-woman, instead of pro-choice. But they didn’t. So, here we are today, fighting to take back the language and the law about what it really means to be pro-life.

[1]      Bartlett, J., 5/14/22, “Examining the biology of birth control,” The Boston Globe

[2]      Guttmacher Institute, Sept. 2019, “Induced abortion in the United States,” retrieved from the Internet on 9/16/22 (https://www.guttmacher.org/sites/default/files/factsheet/fb_induced_abortion.pdf)

[3]      Meyerson, H., 8/26/22, “ ‘Pro-life’: America’s most patently absurd misnomer,” The American Prospect (https://prospect.org/politics/pro-life-americas-most-patently-absurd-misnomer/)

[4]      Banerjee, A., 5/18/22, “Abortion rights are economic rights,” Economic Policy Institute (https://www.epi.org/blog/abortion-rights/)

FEDERAL LEGISLATION NEEDED TO PROTECT CHILDREN ON SOCIAL MEDIA

The harm that social media can do to children and youth is well documented. (See this previous post for more detail.) Clearly, the social media platforms are not going to do what’s necessary to keep our kids safe online on their own. No significant relevant federal legislation has been passed since the 1998 Children’s Online Privacy Protection Act (COPPA). A lot has changed since then and new federal legislation is needed.

Note: If you find my posts too long or too dense to read on occasion, please just read the bolded portions. They present the key points I’m making and the most important information I’m sharing.

Europe has done a better job than the U.S. of protecting everyone’s privacy and well-being on social media, including that of children. Its General Data Protection Regulation (GDPR) is four years old and provides greater protections than U.S. laws. Meta (formerly Facebook) was recently fined $400 million because its Instagram subsidiary violated European regulations on the protection of children’s data. [1]

The social media platforms’ business model is to hook kids at a young age, amass extensive personal information about them and their online and consumer behavior, and then use these to engage in lucrative (for them) marketing to the kids in ways that too often promote toxic content and harm kids’ well-being and mental health. [2]

Two pieces of relevant federal legislation are being considered in the U.S. Senate:

  • Kids Online Safety Act (KOSA, Senate bill 3663) and
  • Children and Teens’ Online Privacy Protection Act (COPPA 2.0, Senate bill 1628)

These bills seek to provide privacy protections for children and youth, limit individually targeted advertising (referred to as surveillance advertising), and require the social media platforms to put the interests of young people first. For example, KOSA would:

  • Provide families with the tools and safeguards to protect children’s well-being and health,
  • Require transparency from the social media platforms about the data they are capturing and the algorithms they are using for promoting content and advertising, and
  • Establish accountability for harms caused by social media.

COPPA 2.0 would, for example:

  • Extend to 13 to 16-year-olds the prohibition on social media platforms capturing children’s personal information without their consent and require the platforms to delete any such information they collect if requested to do so,
  • Ban individually targeted marketing to children,
  • Establish a “Digital Marketing Bill of Rights for Minors,” and
  • Create a Youth Privacy and Marketing Division at the Federal Trade Commission (FTC) to monitor and regulate data privacy for and marketing to minors.

Some concerns have been raised, particularly about KOSA. Some privacy advocates have raised concerns that it would allow parents to spy on and control children’s activities online. They worry about unsupportive parents spying on LGBTQ+ youth. They worry that politicians could force the social media platforms to block information on topics the politicians dislike, such as abortion information. And they worry that the social media platforms will block broad arenas of information to avoid liability for possible harm to children.

Trying to regulate social media platforms to keep children safe is complicated, but it’s clear that steps need to be taken to reduce the significant harm that’s occurring. The first laws and sets of regulations won’t be perfect, but we need to act. Then, we can figure out what is and isn’t working and make improvements.

I encourage you to contact your Representative and Senators in Congress and to tell them you support regulation of the social media platforms to prevent them from harming our children and youth. Urge them to support the Kids Online Safety Act (KOSA, Senate bill 3663) and the Children and Teens’ Online Privacy and Protection Act (COPPA 2.0, Senate bill 1628).

You can find contact information for your U.S. Representative at  http://www.house.gov/representatives/find/ and for your U.S. Senators at http://www.senate.gov/general/contact_information/senators_cfm.cfm.

If you’re interested, you can sign-up here for an online information session and Rally for Kids’ Online Safety next Tuesday, September 13, from 6:30 – 7:00 p.m. eastern time. You’ll learn more about how you can support the Kids Online Safety Act (KOSA) and the Children and Teens’ Online Privacy Protection Act (COPPA 2.0). Senators Ed Markey and Richard Blumenthal will discuss how these bills would revolutionize social media platforms’ treatment of kids and teens, requiring them to put young users’ wellbeing ahead of their profits. If passed, the bills would ban surveillance advertising to minors, extend privacy protections to teens, and  set the stage for a safer internet for children and youth. They would also hold the platforms accountable for exploiting kids’ vulnerabilities. Advocates, including Fairplay and members of its Screen Time Action Network, will discuss how you can take action to help get these bills passed.

[1]      Business Talking Points, 9/6/22, “Instagram fined over protection of teenagers’ information,” The Boston Globe from the New York Times

[2]      Corbett, J., 7/27/22. “ ‘Critical’ online privacy protections for children advance to Senate floor,” Common Dreams (https://www.commondreams.org/news/2022/07/27/critical-online-privacy-protections-children-advance-senate-floor-vote)

POLITICAL INFLUENCE BUYING SURE SMELLS LIKE CORRUPTION

Corporations want to have political power and influence on issues that directly affect their interests. They make political contributions and engage in political spending to ensure they have access and a sympathetic ear with elected officials. They view these expenditures as investments from which they expect a return and often get a very high return. Their campaign contributions and political spending are used to grease the wheels of access and influence for their lobbying.

A blatant example of this occurred recently with Senator Kyrsten Sinema (D-AZ) and her demands for modifications in the Inflation Reduction Act in exchange for her critically important vote. Her vote was the crucial 50th vote for the bill and in exchange she demanded that two provisions that would have increased taxes on the wealthy operators of private equity investment funds and hedge funds be taken out of the bill, although they are broadly popular with other Senators as well as with the public. This will allow these few thousand, very wealthy individuals to pay a lower income tax rate than a typical worker. [1]

First, Senator Sinema demanded that the carried interest loophole remain unchanged. It lets hedge fund and private equity managers claim their income is capital gain taxed at around 20% instead of earned income taxed at around 37%. This saves them about $1.4 billion a year. Not only the public, but even many of the people who benefit from this special interest tax break, recognize that it so egregiously unfair that it should be ended.

Second, she demanded that private equity-owned firms be exempt from the new 15% minimum tax on companies with over $1 billion in annual profits. This change in the tax laws would ensure the large, profitable companies cannot use loopholes to avoid paying any income tax as many of them have done in the past. (See previous posts here and here for more on the long history of large, profitable corporations paying little or no income tax.) This exemption is estimated to save the private equity industry about $3.5 billion per year.

Senator Sinema has received more than half a million dollars in campaign contributions from private equity and hedge fund managers in the current two-year election cycle. This represents about 10% of her fundraising from individual donors. Since she was elected in 2017, she has received more than $2.2 million from the securities and investment industry. [2]

The roughly $5 billion per year tax benefit the private equity and hedge fund managers will receive with the elimination of these two tax changes represents an over 10,000 to 1 return on their investment! If this doesn’t scream corruption, I don’t know what does. As the Patriotic Millionaires group wrote, “It’s clear that [Senator Sinema] doesn’t work for her constituents, she works for private equity and hedge fund billionaire supporters.”

On a different front, the Blue Cross Blue Shield (BCBS) network of non-profit health insurance companies receives substantial tax benefits that are the result of significant expenditures on campaign contributions and lobbying. From 2018 to 2021, 12 of 32 BCBS companies didn’t pay any net federal taxes and have, in fact, collectively received more than $6.6 billion in tax refunds. This reflects a long history of working with people in Congress to craft complex tax rules that give the BCBS companies special treatment.

Most recently, the 2017 tax cut law passed by Republicans in Congress and the Trump administration repealed the Alternative Minimum Tax (AMT). The AMT was created to ensure that high-income taxpayers, businesses and individuals, could not use loopholes in the income tax system to owe little or no tax, which many had done and could do without the AMT. An AMT was first created in 1969, was significantly modified in 1982, experienced changes in other years, and then was repealed in 2017.

Many of the BCBS companies paid the Alternative Minimum Tax because the special treatment they had gotten into the tax system reduced their traditional income taxes to little or nothing. In particular, in 1986, the BCBS companies succeed in lobbying Congress to create them a special tax break that reduced their taxes by about $400 million per year. It has been described as “an artificial deduction that no one else gets.” [3]

Therefore, the BCBS companies lobbied hard and successfully to get the AMT repealed in the 2017 Tax Cuts and Jobs Act. Not only did this reduce their taxes for future years, it also allowed them to use tax credits they had accumulated in the past to receive substantial one-time tax benefits, reflected in the billions of dollars of tax refunds BCBS companies have received in the last four years.

(NOTE: If you’re surprised that the non-profit BCBS companies pay income taxes to begin with, they were historically considered tax-exempt non-profit charities. However, in 1982 their exemption was removed because they, and other health care non-profits, were operating much like traditional corporate businesses; they were for all intents and purposes commercial enterprises rather than charitable ones.)

The BCBS companies, over the last eight years, have invested an average of over $4 million a year in campaign contributions and over $23 million a year in lobbying. [4] Over the last four years, just the tax refunds they have received reflect a 60 to 1 return on investment, before even factoring in the reduced taxes paid by the BCBS companies.

The health care industry as a whole in the 2020 two-year election cycle spent $690 million on campaign contributions and $1.2 billion on lobbying. As a result, the internationally unique, private, capitalistic U.S. health care system had over $189 billion in profits in 2021 (pharmaceuticals: over $100 billion; hospitals: over $70 billion; and health insurers: $19 billion). Meanwhile, over 500,000 families experienced medical cost-driven bankruptcy in 2021. A recent National Academy of Sciences report estimated that a public, single-payer, universal health care system, similar to what exists in every other developed country, would save, every year, 212,000 lives and $438 billion. [5] [6]

[1]      Bowden, A., 8/5/22, “Sinema’s defense of carried interest is indefensible,” Patriotic Millionaires blog (https://patrioticmillionaires.org/2022/08/05/sinemas-defense-of-carried-interest-is-indefensible-2/)

[2]      Stancil, K., 8/8/22, “Sinema received over $500K from private equity before shielding industry from tax hikes,” Common Dreams (https://www.commondreams.org/news/2022/08/08/sinema-received-over-500k-private-equity-shielding-industry-tax-hikes)

[3]      Herman, B., 6/20/22, “Blue Cross Blue Shield system reaps billions in tax refunds,” The Boston Globe

[4]      OpenSecrets, retrieved 9/2/22, “Blue Cross / Blue Shield summary,” (https://www.opensecrets.org/orgs/blue-cross-blue-shield/summary?id=D000000109)

[5]      Hartmann, T., 6/15/22, “How many billions in profit is it worth to kill 212,000 Americans a year?” Common Dreams (https://www.commondreams.org/views/2022/06/15/how-many-billions-profit-it-worth-kill-212000-americans-year)

[6]      Galvani, A.P., et al., 4/22/22, “Universal healthcare as pandemic preparedness: The lives and costs that could have been saved during the COVID-19 pandemic,” Proceedings of the National Academy of Sciences (https://www.pnas.org/doi/epdf/10.1073/pnas.2200536119)