Policy

Remember the High Costs of Unpaid Sick Leave When You’re Voting This Fall

The Other Washington guests Jessyn Farrell and Bill Marler.

The Other Washington guests Jessyn Farrell and Bill Marler.

This fall, Washington state will vote on Initiative 1433. Many Washingtonians know that a “yes” vote on 1433 will raise the state minimum wage to $13.50 by the year 2020. But fewer people know that 1433 also provides up to seven days of paid sick and safe leave for workers per year.

This is so important. Over a million Washington workers have no access to paid sick leave, which means that a missed day of work results in the disappearance of one-fifth of a weekly paycheck for those who work 40 hours a week. Many minimum-wage workers simply can’t afford that kind of a hit to their weekly pay; an unpaid sick day could mean the difference between paying rent or driving up credit card debt yet again. And many of these workers are in the food service industry, which means that when they show up to work sick, they put all their customers’ health at risk.

For the latest edition of our podcast, The Other Washington, we talked with 46th District State Representative Jessyn Farrell about why she supports paid sick and safe leave. She makes a great case for the initiative to provide sick leave for food service workers, but she also makes a strong, personal case for family leave: Farrell was born with a quarter-sized hole in her heart, and the economic impact of that birth defect was hugely consequential in her family.

We also talked with food safety lawyer Bill Marler about the nearly quarter-century he’s spent fighting companies that make customers sick. Marler is one of the world’s leading experts on foodborne illnesses, and he provides a compelling case for allowing sick workers to stay home. The tiny amount that employers like Chipotle are saving by not providing sick leave is insignificant when viewed in comparison to the millions—even billions—that companies pay out to sickened customers after protracted legal battles.

We hope you’ll enjoy this latest episode of The Other Washington, though—just being honest, here—you might not want to listen to it while you’re on your lunch break. And remember to vote yes on Initiative 1433 when your ballots arrive in the mail this fall.

Self-Selecting Poll Blows Up in Restaurant Lobby’s Face

"Of course you realize, this means war..."

“Of course you realize, this means war…”

When reading about the results of surveys, you should always, always, always consider the source. Self-selecting surveys—most of which take the form of those online Survey Monkey-style polls you see sometimes on Facebook—are basically meaningless. What they tell us is this: an organization wanted to see a certain set of results, and so that organization pushed its polls out to users who were likely to give them the result they want.

With that in mind, our friends at Working Washington uncovered something very interesting in a survey led by the Seattle Restaurant Alliance. The survey is being used to argue against the secure scheduling legislation currently under consideration by the Seattle City Council, but Working Washington discovered that the poll actually made a pretty great case for secure scheduling. To wit: nearly a third of the poll’s anonymous respondents complained about not getting enough notice of their schedules. Nearly a quarter said they wanted more hours on the job, and nearly a quarter complained about a lack of flexibility in their schedules.

Of course, the Seattle Restaurant Alliance wants to paint this as a “glass-half-full” kind of situation, but if you look at it by letter grades, a 75 percent score is a borderline C in most schools, and 66 percent would be an D. And, as Working Washington points out, this is a survey which is expected to be about as positive as humanly possible. What would a truly independent polling outfit discover if they were allowed to survey Seattle restaurant workers?

But even so, none of these results are an argument against secure scheduling. The Seattle Restaurant Alliance wants us to believe that most employers are great at scheduling their employees. Okay. Then those restaurants should have no problem with new secure scheduling laws, then! If their employees receive their schedules two weeks in advance, and if the employers don’t employ inhumane on-call practices to keep their workers on the hook for hours they may never actually work, then the employers are doing everything right and the law won’t affect them.

Secure scheduling practices are intended to watch out for the dishonorable employers who monopolize their workers’ time—even the time they don’t spend at work—and make it impossible to experience ordinary events that you or I might take for granted: the opportunity to enjoy a hobby, or to volunteer for a nonprofit we support, or eat a meal with family, or even take on a second job. If the people who work for the businesses behind the Seattle Restaurant Alliance are already enjoying these basic human rights, surely the Seattle Restaurant Alliance won’t mind if we ensure that a few bad employers are forced to do the same?

The Real Cost of ST3 Would Come from Not Passing It

Sound Transit

Kudos to Seattle Times transportation reporter Mike Lindblom for breaking down the taxpayer cost of the proposed Sound Transit 3 measure, especially his explanation of how property taxes really work:

Chances are, you’re now wondering if transit property taxes would skyrocket after 2017, presuming home values continue their rapid rise.

They wouldn’t.

Tim Eyman’s Initiative 747 capped the increases in property-tax collections for most local taxing districts at 1 percent, excluding new development.

So the average ST3 property-tax bill would increase 1 percent in 2018 and beyond. As a rate, the initial $25 would gradually decrease, if values rise.

Sure hope his paper’s editorial board digests this explanation before once again misinforming readers with bullshit claims that the property tax “would rise with the real-estate market.”

But as much as I appreciate Lindblom’s evenhanded explanation of the cost of passing ST3, I wish he had spent a couple hundred words explaining the high cost of doing nothing. And the cost is huge—assuming commuters value their own time.

According to Sound Transit our region’s population is expected to grow 30 percent by 2040—that’s about a million more people crowding our roads, ferries, buses, and rails. And they’re going to have to get to and from home, work, school, shopping, and leisure somehow. Build ST3 and many of these additional trips will occur on bus and rail. Don’t build ST3 and most of these new trips will be forced onto our already congested roads. While building ST3 isn’t likely to make our traffic better, it is almost certainly going to make it less worse.

How much less worse? I can only speculate. But even a modest reduction in the increase of cars on the roads would generate huge payoffs for those of us who continue to drive.

The math is actually quite simple. Imagine just a 10 minute difference each way on your daily commute—about 20 additional minutes a day stuck in traffic with a million more people and no ST3. Figuring 50 work weeks a year times 5 workdays a week, that’s an additional 83 hours a year of commuting without ST3 than with it. According to the US Bureau of Labor Statistics, Seattle’s mean hourly wage is currently about $30 an hour. So if you value your time, that would come to about $2,500 a year in opportunity cost lost in rejecting ST3, compared to an average $169 a year in new taxes (per adult) if we pass it. Hell, even if building ST3 only saves a minute each way from our daily commutes, the average taxpayer still comes out ahead.

And that’s just your daily commute. Throw in all the other times you find yourself stuck in traffic at all hours of the day and night, and those minutes start to really add up. It quickly becomes apparent that both collectively and individually, the cost in lost time and productivity from not building ST3 far, far exceeds the cost of building it.

Of course, that’s a lot harder to quantify than ST3’s $53 billion price tag. But it’s worth a mention.

Go Read #SeaHomeless

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Today, media in Seattle and San Francisco are focusing on homeless issues. Homeless populations in both cities are growing at a rapid clip, and there are so many complicated reasons why this is the case—the skyrocketing cost of housing, a lack of public assistance for the poor, very little mental health care coverage, etc.

In an ideal world, newspapers would have dedicated homeless issues reporters. Instead, we have an ever-shrinking array of city beat reporters who are stretched too thin to adequately cover all the stories out on the streets. But they’re trying, and today is a day for them to share the coverage that they’ve given the topic, as well as to debut new stories.

You’ll find the Seattle portion of the coverage on Twitter under the hashtag #SeaHomeless. Some highlights so far:

There is so much more for you to read, and there will be updates all day long on Twitter and in social media. Go be a part of the conversation, or perhaps most importantly you should go be a witness. Your reading these stories is so important; it reminds editors and publishers that Seattle cares about homelessness, and wants our media to keep covering the issue.

Everyone’s Ignoring Paul Ryan’s New Republican Agenda. Good.

As I previously mentioned, Paul Ryan is rolling out this year’s Republican agenda throughout the month of June. Under the headline “A Better Way,” Ryan’s plan is supposed to be a reclamation of Republican ideals, reimagined for the future. Too bad  nobody’s paying any attention to Ryan right now because of the giant sweaty orange elephant in the room. Michelle Cottle at The Atlantic writes:

Just look at what happened at the rollout of the agenda’s first plank: Ryan’s pet anti-poverty plan. The speaker and seven colleagues crossed the Anacostia River to commune with the impoverished, overwhelmingly minority residents from the “bad” side of Washington. But after all the speechifying, the only thing reporters wanted to talk about was Donald Trump’s latest outrage, regarding the Mexican heritage of Judge Gonzalo Curiel. And so the big news to come rolling out of the event was Ryan’s “textbook” racism comment.

The first six questions were about Trump,” AshLee Strong, Ryan’s spokesman recalled to me.

"And now I'm about to repeat the same song I've been singing for the last decade...hey! Guys? Where you going, guys? Guys!"

“And now I’m about to repeat the same song I’ve been singing for the last decade…hey! Guys? Where you going, guys? Guys!”

Poor Paul Ryan. Nobody’s paying attention to his big new ideas because they’re more concerned with the bigoted tyrant at the forefront of his party who could conceivably destroy America’s economy for a generation. It’s a real tragedy for Ryan.

Except it’s fine to ignore Ryan’s policy proposals because there’s nothing new about them. As I pointed out, he’s been propping up the same tired and ineffectual poverty plan for most of his career. And the more of A Better Way that I see, the more I realize that it’s not new at all. What Ryan is proposing here is more trickle down economics for the masses.

The conservative trickle-down ideology promotes a wide array of policies which promote three basic goals in order to make the rich richer and the poor poorer:

  1. Tax cuts for the wealthy.
  2. Deregulation for the powerful.
  3. Wage suppression for the 99 percent.

And so with these three policies in mind, let’s look at the plan that Ryan is unveiling to an audience of zero. Here’s Paul Ryan’s take on regulations: “regulations can stifle innovation and infringe on liberty.” He throws on some shiny details about “transparency” and so on and so forth, but really these are the things you always talk about when you’re arguing for deregulation. So that’s number two on the list.

Ryan is already on the record as vociferously combating the minimum wage, which is the third item on the list. He’ll be unveiling the tax part of his plan, presumably, next week. If that plan includes a tax increase on the wealthy, I will happily and publicly apologize to Ryan.

I’m not counting on it, though.

In the end, it’s probably good that Ryan’s big announcement is getting blown out of the media sphere by Donald Trump’s ongoing trash fire of a campaign. If anyone was paying attention to Ryan’s plan, they’d definitely notice that there’s nothing new about it. In fact, it’s the same old Republican agenda slapped up on a (relatively) snazzy new website.

 

A New Report Says We Should Stop Treating Our Employees Like They’re Paperclips

Screen Shot 2016-06-08 at 1.09.28 PM

As Nick Hanauer wrote in the American Prospect, the American economy today is home to two types of businesses: “those that pay their workers a living wage—the real economy—and those that don’t—the parasite economy.” Put another way, there are employers who invest in their employees, and there are employers who drain their employees of their resources; the two big pairs of examples that Hanauer uses in the article are McDonald’s (parasite economy) and In-N-Out Burger (real economy) and Wal-Mart (parasite economy) and Costco (real economy).

Parasite economy employers often write food stamps and other government assistance programs into their business model; the government must step in to ensure that low-wage employees can survive on what their employers pay. What eventually happens is that real economy employers wind up subsidizing parasite economy employers. So as a nation, we want to encourage real-economy employers and discourage parasite-economy employers.

A terrific new report from the Center for American Progress titled “Workers or Waste?” offers a quick and easy way to reward honorable real-economy employers for their investments in human capital.  We want businesses to train and educate their employees; everyone understands almost instinctually that trained employees earn more, work more efficiently, stay on the job longer, and have better prospects when they move on. A smarter, more employable workforce is not just great for employers, it’s great for the economy. But we currently disincentivize that investment. As the authors explain:

…A $10 million investment in worker training shows up in a firm’s financial statement—not on its own but lumped into selling, general, and administrative expenses, or SG&A, a measure that includes items such as company lunches and paper clips. Companies’ expenditures on worker training and skills show up not as a valuable investment similar to R&D but as an increase in general overhead, a measure that managers have shown a proclivity for cutting and whose reduction is often cheered by investors. This treatment of human capital ignores the findings of numerous studies: Investments in human capital enhance productivity and are more valuable to a firm than general overhead expenses.

So what’s the solution? The authors recommend…

…requiring companies to distinguish investments in training from general overhead by reporting those investments separately. Requiring firms to disclose their investments in human capital, as they do for R&D, has the potential to pay off for investors, firms, and workers. It would allow firms to demonstrate to investors that they are making productivity-enhancing investments in their workers and would supply investors with material information upon which to base investment decisions. Furthermore, to the extent that disclosure would lead firms to increase human capital investment, it should help raise workers’ wages and benefit the economy overall.

As I said before, everyone understands that employers who invest in their employees are quality employers. And everyone understands that quality employers are generally more profitable and more aligned with the idea of long-term growth. If investors could clearly see which businesses are quality employers and which businesses rely on sheer churn of unqualified staff to get things done, those investors would be better informed about a company’s long-term vision.

This is an elegant solution—one that doesn’t create a whole new government office or a complex series of laws. It simply asks businesses to report their expenditures in a slightly different, more intelligent way. And for the investors, this makes a lot of sense: suppose you had to choose between working at Costco or working at Wal-Mart. Which would you choose? If you’re being honest with yourself, you’d obviously pick the high-quality employer, right? You know that the high-quality employer is going to pay you better, train you better, and plan for your long-term relationship with the company. So why, then, wouldn’t you invest that way?

Paul Ryan Dusts Off His Terrible Poverty Plan One More Time

Speaker Paul Ryan today decried Donald Trump’s comments about Judge Gonzalo Curiel as “the textbook definition of a racist comment.” In a question-and-answer period with the press, Ryan also used words like “disavow” and “regret” to describe his reaction to Trump’s racist comment. So does that mean Ryan regrets his all-but-an-endorsement endorsement of Trump? Well, no. Specifically, here’s what he said about that: “Do I think Hillary Clinton is the answer? No I do not.”

So to be clear, Ryan acknowledges that Trump made a “textbook…racist comment.” But he also acknowledged that he’s still voting for Trump. Which is good to know! It’s obviously good to know when our elected leaders don’t consider alarming racist comments to be a reason to not vote for someone. Hell, at least Ryan made a statement. Washington gubernatorial candidate Bill Bryant recently received 15 minutes of grilling from journalist Joni Balter and he still won’t admit whether or not he’s voting for Donald Trump. (“I am not going to turn the governor’s race into a comment on the presidential race,” Bryant told Balter. Uh, good luck with the next half-year or so, Bill.)

Anyway, Ryan’s unsatisfying statements on Trump completely buried the news that Ryan had hoped would lead the day: he just revealed his hope for the 2016 Republican agenda, which he optimistically titled “A Better Day.” Specifics for “A Better Day” will be rolled out over the next few weeks, but Ryan started today with poverty. Here, from the “A Better Day” website, are the GOP’s ideas for solving poverty:

(That "Collapse" at the bottom isn't a GOP idea to solve poverty, by the way; it's just a prompt to close the window.)

(That “Collapse” at the bottom isn’t a GOP idea to solve poverty, by the way; it’s just a prompt to close the window.)

Okay. Well, a lot of these are so vague that it’s impossible to argue — does anyone really want to worsen skills and schools? — but others hint at the direction Ryan is going with this anti-poverty program. Specifically, Ryan is interested in blaming the poor for being poor.

Let’s talk specifically about number one on the agenda, which is about work requirements for welfare. Research shows that work requirements do create more work, but they’re lousy when it comes to improving economic situations. In other words, if you want to keep poor people on a poverty treadmill, you institute work requirements. If you want improved mobility, you make it easy for them to get additional education. Ryan’s decision to focus on work requirements at the top of his agenda is a signal that his poverty programs exist to control poverty, not to lessen it. Without investments in people, work requirements only defer the problem of poverty for another few years.

I could go deeper on this, but I just found this article titled “Why Ryan’s Proposed Work Requirements Are Cause for Concern” that covers the problems fairly in-depth. You should read it. How did LaDonna Pavetti write this article so quickly in response to Ryan’s announcement? She didn’t. She wrote it in 2014, when Ryan last proposed work requirements. Ryan has been proposing them for years. He’s the Republican budget guy; he always proposes “aspirational” budgets that are supposed to encourage the Republican party to slash regulations, cut taxes, and slice up the social safety net for the poorest Americans.

Only one element of Ryan’s language has changed through the years: he’s adopted more inclusive phrasing. The “Our Principle” section of the poverty part of  “A Better Day” reads, “If the American Dream isn’t true for everyone, it isn’t true for anyone. All of us should have the chance to make the most of our lives no matter where we start.” This sounds like progressive language, until you take into account the policies these words are describing. What Ryan is doing throughout the “A Better Day” document is interesting: he’s trying to crib his ideas in that of his opponents and hoping that voters don’t notice it’s the exact same trickle-down agenda he’s been pushing for his entire career. This is the same genius, after all, who tried to blame the Democratic party for trickle down economics back in January, which landed about as smoothly as a one-legged pigeon. Maybe Ryan’s agenda would succeed if he worried more about the content of his ideas and less about the packaging of them.

It’s Time to Reform Debt Buying and Debt Collection

Last night on Last Week Tonight, John Oliver made television history for the largest giveaway by a TV show, easily surpassing Oprah’s “You get a car! You get a car! Everybody gets a car!” moment. The thing that Oliver was giving away was not as sexy as new cars, but it was much more life-changing: he forgave $14 million in medical debt. At twenty minutes, this video is long by internet standards (and it’s riddled with swears so if you’re at work you should put your headphones in) but it’s very worth it.

If you don’t have the capacity to watch videos right now, here’s a short recap: American households carry over twelve trillion dollars in debt. Nearly 450 billion of that debt is over ninety days overdue. That 450 billion is likely to be sold for a fraction of the cost by banks and other financial institutions to collection companies, which then often use smarmy methods to try to collect on the debt. Oliver’s show spent $50 to incorporate as a collection company, and within a matter of days, his corporation was offered just shy of $15,000,000 of medical debt information for nine thousand people, which they then bought for less than $60,000. The information consisted of a bare-bones spreadsheet with names, Social Security numbers, and addresses.

Ordinarily, that would be the point when the collection company would start shaking down the debtors with continuous phone calls, legal threats, and other, potentially illegal methods (including calling friends, coworkers, and family of the debtors in an effort to publicly shame them) to get some of that money back. Instead, Oliver forgave the debt, thereby breaking Oprah’s record.

Obviously, debt collection reform is necessary. Look into the history of debt buying and you’ll see some small efforts to rein in debt buyers, like this, from last year:

Under consent orders, Encore Capital Group and Portfolio Recovery Associates will pay a combined $18 million in fines and provide $61 million in refunds,  while also stopping collection on another $127 million in consumer accounts. The combined moves will give relief to tens of thousands of consumers being hounded by collectors or collection lawsuits, the CFPB said. The companies must also stop reselling debt they own to other companies.

But when you consider that Encore “collected more than $1.7 billion in 2015,” those consent orders look like small change in comparison. Real reform is happening on a state level—North Carolina and Maryland are leading the way, with good results—and hopefully this Last Week Tonight stunt will get the conversation going in other states and on a federal level.