THE AFFORDABILITY CRISIS Part 4

The U.S. affordability crisis is multifaceted and has been growing for 45 years, caused by low pay and high prices. Many factors have been depressing workers’ pay including the failure to raise the minimum wage, the weakening of unions, globalization, gig work, and reduced competition for workers.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

The U.S. affordability crisis is multifaceted and caused by low pay and high prices. (Previous posts have discussed the reasons for high prices.) This post will discuss the factors leading to low pay.

Over the last 45 years, workers’ pay has barely kept up with the increase in prices (i.e., inflation). And the pay increases there have been, have gone disproportionately to high earners. A study by the Economic Policy Institute found that between 1979 and 2019 the annual wages (adjusted for inflation) of the lowest-income 90% of workers increased by 26%, while the wages of those in the top 1% rose by 160%. The next richest 4% of workers saw their wages increase by 75%. CEOs now make about 300 times what their typical employee makes, while in 1960s they only made 20 times as much as the typical worker.

Good, middle-class blue- and white-collar jobs have been lost to globalization, while the compensation for the remaining jobs has declined due to the purposeful undermining of unions and global pay competition. The result is a crushing affordability crisis for many current and formerly middle-class households, as well as for lower income households.

According to a Brookings Institute analysis, 43% of American families can’t afford to pay for housing, food, health care, child care, and transportation. This figure is 59% for Black families and 66% for Latino families. The shift in income from workers to executives and investors has been dramatic: in 1947 workers received 70% of total national income, while today they get only 59%. Unlike the previous 35 years, after 1980, workers did not receive wage increases that were in line with their increases in productivity: from 1979 to 2025 workers’ productivity increased by 87% but their compensation only increased 33%. According to a Rand Corporation analysis, in 1975, the 90% of workers at the bottom of the income spectrum received 67% of national income, while in 2019 (the latest data it had) they received just 47% of national income. This highlights again the skewing of income to the top 10%. It calculated that if, in 2023, the 90% of workers with the lowest incomes had received 67% of national income (as they did in 1975), they would have earned an additional $4 trillion or, on average, each worker would have made $28,000 more than they did. Over the period from 1975 to 2023, if these workers had received 67% of national income, they would, in aggregate, have received $79 trillion more in income. [1]

There are many factors that have been depressing workers’ pay. They include:

Failure to raise the minimum wage. The federal minimum wage of $7.25 an hour is only 29% of a typical worker’s wage today; in 1968, it was 53% of the typical wage. If the minimum wage had been raised at the same pace as productivity growth since the late 1960s, it would be over $24 an hour today.
Dramatic weakening of unions by the emasculation of pro-union government policies and of the enforcement of labor laws, as well as by the monopolistic power of huge employers. These have resulted in a huge shift in power from workers to employers over the last 45 years. Union membership has declined from roughly a third of workers in the 1950s to under one-tenth of workers today and only one-sixteenth of private sector workers.
Globalization, which shipped jobs overseas and put downward pressure on the pay for the remaining jobs.
Gig work and the misclassification of workers as contractors and not employees, which reduces wages, removes the protections for employees that are in labor laws, and typically means they get no benefits (e.g., health insurance, sick or vacation time, and retirement benefits). A 2021 study estimated that nine million American workers, from Amazon and FedEx delivery personnel to Uber and Lyft drivers, earn between 15% and 30% less than they would as employees.

The gig work-based companies, using AI with vast amounts of personal data and tremendous computer processing power, can tweak the pay of gig workers instantaneously so each worker gets the minimum pay for which they’re willing to do a job. For example, Uber pays drivers based on their past behavior. If a driver is hungry for work, perhaps because they badly need the income, and therefore always grabs the first job that is offered, Uber will pay them less because it knows they’ll take the job. On the other hand, Uber will offer more to a driver that waits for a better paying option.
Reduced competition for workers among employers due to fewer, very large employers and the widespread use of non-compete clauses in workers’ contracts (which prevent workers from moving to similar work for another company, down to and including other franchisees of the same fast-food chain). The Federal Trade Commission under President Biden banned non-compete agreements but the Trump administration undid this.

Capitalism in the U.S. is out of control. Competition has been stymied and monopolistic power is widespread. This has happened because of the failure to enforce antitrust laws for 45 years (except for four years under President Biden).This means the invisible hand of a market economy and the economic “rules” of supply and demand do not work to give fair compensation to workers. The rules of the economic game have been rigged to favor large employers. One indicator that clearly confirms this is that corporate profits are at very high levels in terms of percentage of revenue. In 1980, 80% of corporate income was paid to workers; in 2025, that percentage was under 72% with the difference largely going to profits.

Regulators have been compromised (aka captured) by the large employers through the political influence garnered by campaign spending and lobbying, as well as the revolving door of personnel between government regulatory positions and private industry jobs. As a result, many aspects of corporate behavior have undergone deregulation, which allows companies to increase profits by, for example, blocking increases in the minimum wage, shipping jobs overseas, gig work, breaking existing unions, blocking union organizing, failing to negotiate in good faith with unions, and frequently preventing new unions from ever getting a contract. In 2018, 63% of new unions, each of which had been voted for by a majority of workers, failed to get their employer to agree to a contract within a year. Amazon workers at a New York City warehouse voted decisively for a union in April 2022, but as of December 2025, Amazon had refused to even begin contract negotiations with them. This reflects a lack of effective labor laws and a lack of enforcement of them.

My next post will discuss steps to take to tackle the affordability crisis.

[1] Meyerson, H., 12/3/25, “The $79 trillion heist,” The American Prospect (https://prospect.org/2025/12/03/79-trillion-heist-worker-pay/)

GOOD NEWS TO START THE NEW YEAR

2025 was a horrible year for American democracy. However, many good things did happen; here are some of them. Let’s keep up the activism and resistance in 2026. And let’s get out to vote and get everyone we know out to vote. That will make it a much better year than 2025 was. Happy New Year!

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

2025 was a horrible year for American democracy. However, there were glimmers of hope and many good things did happen. Let’s start 2026 by looking at some of the good things that happened in 2025.

Many increases in the minimum wage, put in place in 2025 or earlier, will go into effect in 2026. On January 1, 19 states will increase their minimum wage, on average from $13.90 to $14.57. (Note: The federal minimum wage is $7.25.) Over eight million workers will benefit. Three more states and D.C. will increase their minimum wage later in 2026. Furthermore, roughly 50 counties and municipalities will increase their minimum wage in 2026. [1]

Bob Reich presents his 2025 top ten biggest wins in domestic politics in a 3.5-minute video from Inequality Media. They include the growing pushback and protests against Trump and his administration from the public at the No Kings rallies and through other actions. He notes Democratic election wins for Governor in New Jersey and Virginia, for Mayor in Miami, New York, and Seattle, and for supreme court seats in Pennsylvania and Wisconsin, among others. He highlights positive actions by voters and legislators in several states in support of school meals and universal child care, in opposition to huge data centers and consumer price manipulation, and in blocking junk fees and private equity firms’ ownership of health care providers. He also celebrates the resurgence of unions and worker solidarity, including the strike by Starbucks workers.

Medea Benjamin at Common Dreams identifies “10 good things that happened in 2025” in the arena of justice and peace here in the U.S. and abroad. They include the growing protests against ICE and support for immigrants, which have led to the release of a number of ICE detainees. The growing resistance to war and the use of the military by theTrump administration also make the list, along with the growing opposition to the horrors of the ongoing war on the Palestinians.

Jess Craven, in her Chop Wood, Carry Water blog, posts good news at a very granular level every Sunday. In addition to touching on many of the topics mentioned above, her 12/28 edition also highlighted the Supreme Court ruling disallowing the Trump administration’s deploying of the National Guard in Chicago, the growing resistance to ICE, and increasing opposition to the Trump administration’s military actions. She also notes the freeing of Abrego Garcia from ICE detention and Arizona’s elimination hundreds of millions of dollars of medical debt for its residents. And much more. In her 12/21 edition, she highlighted the growing production of clean energy (despite the Trump administration’s opposition), resignations at the Heritage Foundation (the source of Project 2025), the success of a discharge petition in the U.S. House requiring a vote on extending the Affordable Care Act subsidies, a judge blocking the corrupt sale of a private equity-owned nursing home chain (to escape liability for patient negligence claims), and a judge’s nullification of the Trump administration’s termination of some federal employees. And much, much more.

Let’s keep up the activism and resistance in 2026! And let’s get out to vote and get everyone we know out to vote. That will make it a much better year than 2025 was. I’m raring to go and I hope you are too!

Happy New Year!

[1] Wilkins, B., 12/31/25, “‘A national disgrace’: 19 states to raise minimum wage but federal rate stuck at $7.25,” Common Dreams (https://www.commondreams.org/news/minimum-wage-increase-2026)

WHAT EVERYDAY AMERICANS WANT FROM GOVERNMENT

Many Americans are worried about being able to afford the cost of living. Government policies can increase the amount of money they make and the benefits they get, as well as reduce the cost of everyday expenses. If Democrats or others want to garner support and votes, they should unequivocally advocate for policies that would improve the affordability of day-to-day life. Some examples are presented below.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

Polls have shown for some time, and elections results on Nov. 4 underscored, that many Americans are worried about being able to afford the cost of living. This has two components: 1) the amount of money they make and the benefits they get from their employer, and 2) the cost of everyday expenses from food to housing to health care to utilities.

If Democrats, or another party such as the Working Families Party, want to garner support and votes, they should focus on the affordability of day-to-day life. They need to promote a vision of a more economically secure future for working Americans. They should embrace economic populism, including reducing economic inequality. [1]

Workers’ wages haven’t kept up with inflation over the last 45 years. The value of the federal minimum wage is 60% of what it was 45 years ago. Similarly, workers’ wages have not kept up with their increases in productivity. The result has been that investors and corporate executives have gotten rich, very rich, billionaire rich, off the big profits companies make on the backs of underpaid workers. Meanwhile, workers’ standard of living has been falling, and, for many, their economic security is gone. Government has helped, but its safety net is fragmented and full of holes. It prevents some workers, some of the time, from becoming destitute. Nonetheless, many workers are anxious, distraught, depressed, and even suicidal. Meanwhile, the government safety net is in effect subsidizing large companies that don’t pay their employees enough to live on. However, these big companies and their owners and investors don’t want to pay a fair share of the taxes needed to fund even this limited safety net.

Here’s an overview of some government policies that would increase workers’ compensation, including both wages and benefits. [2]

Increase the minimum wage. Government officials and candidates at all levels, national, state, and local, should work toward increasing the minimum wage. If Democrats want to continue the winning momentum from the recent elections and want to win back one or both chambers of Congress, they should run hard on increasing the minimum wage and put questions to do so on the ballot wherever they can. (Note: An enormous body of research on the effects of higher minimum wages has shown that past minimum wage increases have meaningfully raised pay for low-wage workers without causing significant increases in unemployment. Moreover, increases in the minimum wage often lower worker turnover, a major cost savings for employers, and can attract better workers.)
Support unions and unionization. Unions built the American middle class, but Republicans have been undermining unions and the ability to unionize for 45 years. (See Story #2 in this previous post and also this previous post for more background.) Democrats weren’t actively supporting unions either and were complicit in expanding global trade and the off-shoring of jobs, which undermined unions and workers’ wages here in the U.S. Elected officials and candidates need to stand up for unions and strengthen federal laws and agencies that support and protect workers right to unionize. For example, federal laws and regulators should not allow companies to do what Starbucks has done. It has been stonewalling its workers since the first votes to unionize in December 2021. It has refused to meet with union representatives and has failed to engage in any serious bargaining. It has shut stores where workers voted to unionize. While its workers face low pay, rising health care costs, and working conditions that are not worker friendly, Starbucks’ CEO made $96 million last year.
Other ways to increase workers’ incomes. The federal and state governments should take action to enforce labor laws and reduce wage theft. Wage theft occurs when employers don’t pay overtime as they’re supposed to, don’t pay workers for some of the time they spend on the job or in job-related activities, etc. It adds up to billions of dollars a year. In addition, overtime rules should be strengthened so employers can’t dodge overtime pay by claiming that low-level, low-pay workers are members of management who aren’t eligible for overtime pay.
Ways to increase benefits. The federal and state governments could increase unemployment benefits, strengthen regulations on employer offered health insurance, and enhance requirements for employer-supported retirement savings programs. They could require minimum amounts of paid sick leave and vacation time.
Enhance public supports and the safety net. The federal and state governments could expand food, heat, and utility cost assistance programs. They could also enhance subsidies for early education and child care, as well as implement paid family leave. They could increase support for renters and first-time home buyers, while also better regulating private owners of large rental properties and single-family homes, which are increasingly being bought up by investors. They could help alleviate the student debt crisis. Perhaps, most importantly, they could make health insurance and health care more affordable and accessible. Over half of Americans support creating a Medicare for All type universal health insurance program. These public supports and the safety net are underfunded today because wealthy individuals and corporations are not paying their fair share in taxes. More on this in my next post.

My next post will discuss policies that would tackle the cost of goods and services. It will also discuss economic inequality.

[1] Reich, R., 11/3/25, “What the Democrats must do. Now!” (https://robertreich.substack.com/p/what-the-democrats-must-do-now) /

[2] Dayen, D., 7/28/25, “Greg Casar is organizing to win,” The American Prospect (https://prospect.org/2025/07/28/2025-07-28-organizing-to-win-greg-casar/)

SIGNS OF A RESURGENCE OF DEMOCRACY AND PROGRESSIVE POLICIES

An American oligarchy has battled for control of our country since its founding. Today, there are signs of a resurgence of democracy and a third progressive policy era. These signs include a resurgence of unions, campaign finance reforms at the state and local levels, and the growing public and private protests and pushback against the Trump administration. We, the American people, must stand up for democracy. We can defeat the oligarchy.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

An American oligarchy based on wealth and privilege, with race and religion lurking behind them, has battled for control of our country since its founding. Two progressive eras have pushed back against oligarchy, heralded a resurgence of democracy, and made progress toward the founding principles of America. These efforts relegated and regulated the oligarchy to the back seat, putting we the people back in control of America. (See this previous post for more details.)

Today, there are signs of a resurgence of democracy and a third progressive policy era. After 45 years of dramatically increasing income and wealth inequality, shrinkage of the middle class, and workers’ wages not keeping up with inflation or increases in productivity, many Americans are ready to throw the oligarchy out. They recognize that:

Unrestrained capitalism is not good for consumers, workers, communities, or our planet.
Huge corporations tend to engage in monopolistic behaviors.
Oligarchs are anti-democratic and are focused on feathering their own nests.

One sign of surging democracy and progressive politics is the resurgence of unions. Collective bargaining by unionized workers levels the balance of power between oligarch business owners and workers. Unions improve workers’ compensation and working conditions. Evidence of the union resurgence includes:

The number of union elections has more than doubled since 2021.
Workers have won 70% of those elections, the highest win rate in 15 years.
Petitions for union elections increased by 27% in 2024.
Public support for unions is at 70%, the highest level since the 1960s.
60 million non-union workers (40% of the workforce) report they would vote to join a union if they got the chance.

Another sign of surging democracy and progressive politics is the passing of campaign finance reforms in multiple states and municipalities. Although reforms to enhance disclosure of campaign donations are very important, and election reforms to make it easier to register and vote are important, the most impactful reforms are ones that provide public financial support to candidates. There are multiple ways to do this, including giving vouchers or tax credits to voters to use to support the candidates of their choice. More than 14 states and 25 municipalities have enacted campaign finance reforms with some form of public financial support.

Perhaps the most effective way to level the playing field between candidates with access to big sums of money and everyday people running for elected office is a public financing system like the ones in New York City and more recently in New York State. These systems require the candidate to opt into the public financing system, which means the candidate agrees to restrictions on the size of donations and the use of one’s own funds that would otherwise be prohibited by the Supreme Court’s Citizens United decision. (As you probably know, the Supreme Court’s 2010 Citizens United decision equated the spending of money on election campaigns with speech. Therefore, freedom of speech means there can be no limits on campaign spending or donations.) [1]

In these public financing systems, small donations (generally less than $200) from constituents (i.e., residents of the candidate’s district) are matched by public funds (up to 8 to 1) for candidates who agree to limits on the size of donations and other restrictions. A candidate must qualify for public financing by garnering a certain number or dollar amount of small donations from constituents. Studies of campaign public financing systems find that they have many benefits including increased diversity of candidates (by class, race, and gender), increased civic engagement and voting, and increased focus of candidates on issues (as opposed to fundraising).

Another sign of the resurgence of support for democracy is the growing resistance to the Trump administration. Institutions from the mainstream media to colleges and universities to law firms are starting to stand up and push back. Elected officials at the state and local levels are pushing back more and more. Democrats in Congress are becoming more organized and effective in pushing back. The courts for the most part, except for the Supreme Court and certain other very right-wing judges, have been pushing back.

Various elections all around the country have also quite consistently shown that voters are standing up and voting against those who are undermining our democracy and supporting the oligarchy. We need to keep up this momentum in statewide elections in Virginia and New Jersey and state and local elections elsewhere this fall. And we need to continue to work to build a strong wave in support of democracy in the 2026 elections for Congress and other offices.

Most importantly, a growing segment of the public is standing up and pushing back. The millions of Americans who engaged in the Oct. 18 No Kings protests sent a strong, unequivocal message in support of democracy. The many, many other smaller protests that are occurring daily reinforce that message. The pushback on media executives, who were compromising freedom of speech by taking Jimmy Kimmel off the air, sent out shock waves that made those media executives change their minds. We’ll need to continue to do these things again and again to put democracy back in the driver’s seat.

Thank you for all you’re doing! Please keep up the great and important work to save our democracy! We, the American people, as citizens, consumers, and workers, must stand up for democracy. We can defeat the oligarchy, and its authoritarianism and fascism.

For lots of good news on the fight for democracy see Jess Craven’s 10/12 Chop Wood Carry Water post.

[1] Brennan Center for Justice, retrieved from the Internet on 10/17/25, “Reform money in politics,” (https://www.brennancenter.org/issues/reform-money-politics)

SHORT TAKES ON IMPORTANT STORIES #7

Here are short takes on three important stories that have gotten little attention in the mainstream media. Each provides a quick summary of the story, a hint as to why it’s important, and a link to more information. They range from encouraging responsibility in the media to a major victory for workers to the corruption of our economy and politics by a billionaire.

STORY #1: I urge you to sign the Media and Democracy Project’s open letter to news organizations demanding that they cover the upcoming elections in a substantive and meaningful way while making the threats to democracy clear and actively exposing and discrediting disinformation. The Media and Democracy Project describes itself as a non-partisan, grassroots, civic organization engaging in actions in support of more informative, diverse, independent, and pro-democracy media operating in the public interest. It is urging news organizations to follow a detailed set of guidelines summarized by these three principles: [1]

Cover elections like they matter more than sports scores (stop the “horse race” analysis).
Make the threats to democracy clear.
Protect Americans from disinformation.

STORY #2: In a stunning victory for workers, 73% of Volkswagen workers at a Chattanooga TN plant voted to join the United Auto Workers union (2,628 to 985). This is the first major successful union vote in the South and the first at a foreign-owned auto plant in the U.S. (However, every other VW plant in the world is unionized indicating how far behind the U.S. is in supporting workers and the middle class.) Not only had plant management opposed the union, but six southern state governors had issued a joint statement attacking unionization as a threat to liberty and freedom.

This is major step in the rebirth of the labor movement, which had been languishing since 1980. Public approval of labor unions is close to 70%, the highest level in 50 years. The last couple of years have seen a resurgence of union organizing and successful bargaining efforts, including by Hollywood writers, UPS employees, health care workers, university employees, and auto workers, among others.

In the 1950s, one out of every three private sector workers belonged to a union. Today, it’s only one out of every 16 workers. This decline in union membership has caused a decline in the bargaining power of workers, the reduction of wages and benefits, and the decline of the middle class. Corporate America’s war on unions and on workers included changes in government policies that supported unionization, global trade agreements that pitted American workers against foreign labor, and financial deregulation that allowed corporate takeovers, private equity’s vulture capitalism, and abuse of bankruptcy laws to undermine workers and their benefits, particularly retirement benefits. [2]

STORY #3: The ability of billionaires to corrupt our political and economic systems was in evidence as former president Trump reversed himself on whether TikTok should be banned in the U.S. after a recent meeting with Jeff Yass, a billionaire who owns 15% of TikTok’s Chinese parent company, Byte Dance. Yass’s investment company is also the biggest institutional investor in the shell company that merged with Trump’s Truth Social online media company. This merger provided Trump with a windfall profit at a time when he apparently badly needs cash. [3]

As-of March 2024, Yass is also this election cycle’s biggest donor to non-candidate, Republican-affiliated Political Action Committees, having given over $46 million. [4] Yass is also a big donor to right-wing groups in Israel that have supported Netanyahu’s efforts to weaken Israel’s democracy and Palestinian’s rights.

[1] Hubbell, R., 4/15/24, “Biden’s steady hand, part II,” Today’s Edition Newsletter (https://roberthubbell.substack.com/p/bidens-steady-hand-part-ii)

[2] Reich, R., 4/22/24, “The stunning rebirth of the American labor movement,” Robert Reich’s daily blog (https://robertreich.substack.com/p/the-rebirth-of-the-american-labor)

[3] Kuttner, R., 3/27/24, “The corrupt trifecta of Yass, Trump, and Netanyahu,” The American Prospect blog (https://prospect.org/blogs-and-newsletters/tap/2024-03-27-corrupt-trifecta-yass-trump-netanyahu/)

[4] Open Secrets, retrieved 3/28/24, “2024 top donors to outside spending groups, “ (https://www.opensecrets.org/outside-spending/top_donors/2024)