Head-On

The following topics were broadcast on KEIB-AM Los Angeles radio on June 21, 2014. David Cruz and Peter Mathews: [Listen] [Back to Home Page]

Start Time: 37:59

♦ U.S. Health Care Is the Worst in the Developed World
♦ Court Ruling Against Teacher Tenure Won’t Help Your Schoolchildren
♦ The Great Recession Knocks a Family out of the Middle Class
♦ Consumer Price Index Jumps 0.4% in May As Inflation Heats Up
♦ Corporations Scramble for Lowest Business Taxes by Shifting Income to Low Tax Countries
♦ Off Shoring Tax Loophole used by Apple, Inc. and others to avoid paying billions in U.S. Federal income taxes.

Start Time: 65:04

♦ War and Crisis in Iraq, the Disastrous U.S. Intervention in 2003 and the Danger of Intervention Today: 

[Listen] [Back to Home Page]

We need a ‘living wage’

oc register-2

By PETER MATHEWS / Contributing Writer

The Long Beach City Council recently voted for a “Living Wage” of $13.26 per hour for Long Beach Airport and Convention Center workers, including their retail workers.

Minimum wage has lost 20 percent of purchasing power since 1973, and President Barack Obama recently called for cities across the nation to raise the minimum wage, since Congress will not.

Since 2009, the top 1 percent has captured 93 percent of the new income generated. Since 1973, the rich have gotten richer, the poor have gotten poorer and the American middle class has shrunk by 10 percent.

In 1980, the average CEO was making 40 times the income of the average American worker. Today, the average CEO is making 400 times the income of the average worker. Poverty and hunger have increased significantly among low- and moderate-income Americans.

We must commend the Long Beach City Council for trying to uplift the plight of these specific workers, by guaranteeing them a “living wage.” If minimum wage had kept up with increased worker productivity since the 1970s, it would be $21 per hour. If it had kept up with inflation, it would be $16 per hour. However, such a steep, sudden increase may place an unbearable burden on small business. We know that U.S. small businesses employ two- thirds of American workers.

That’s why the local, state and federal governments must reduce the tax burden on small businesses as they create a living wage or raise minimum wage, for millions of poor and middle-class Americans. Governments must also reduce many of the burdensome, unnecessary, and unproductive regulations on small businesses, while keeping the necessary ones. This approach is the most balanced – the only one that will work to benefit American workers and entrepreneurs.

Two prominent Founders of the United States of America, James Madison and Alexander Hamilton helped establish a “Commercial Republic.” An important part of the business of America was going to be business. Another Founder, Benjamin Franklin, an amazing inventor and business entrepreneur, wanted other Americans to be able to do the same: create new ideas, new products, new services and new jobs so all could prosper.

However, President Abraham Lincoln put the concept of entrepreneurship in perspective when he noted, “Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.”

Lincoln’s vision, also the vision of Madison, Hamilton and Franklin, was complimentary and gave birth to the American Dream. Without adequately paid workers, the guarantee in the American Declaration of Independence of the Rights to Life, Liberty, and the Pursuit of Happiness would be empty. Without well-paid workers and a large middle class, there would be no one to help produce and buy the products that guarantee adequate profits for successful business entrepreneurs, and the quality of life for 99 percent of Americans would deteriorate. As will American democracy.

When will our political and corporate leaders of today start re-applying these practical and ethical principles?

The Long Beach City Council has lessened the burden on some workers. It, and other levels of American government, must now act to lighten the burden on other workers and to liberate the genius and energy of small businesses.

Peter Mathews is a full-time political science professor at Cypress College and an adjunct professor of sociology at Long Beach City College.

Peter Mathews Recommends Massive Economic Stimulus to Launch Economy out of Great Recession Orbit

Peter Mathews on KTLK AM 1150, the David Cruz Show: (Dec.3,2013) To grow economy, billions must be Invested in Small Business, Infrastructure, Education.

Partly drawing on the Economic Policy Institute’s study of the stagnant “recovery” from the Great Recession, Prof. Mathews calls for a massive economic stimulus, paid for by closing unproductive corporate tax loopholes, and spending the hundreds of billions of dollars on loans to small business, rebuilding and modernizing our infrastructure, expanding and strengthening education, and re-hiring middle class workers such as teachers, firefighters, and police officers. For a real economic recovery from the Great Recession, and to create and maintain full employment, the U. S. government must invest $650 billion in the private and public sectors in 2013, and between $1.5 trillion and 2.2 trillion in the following three years.

Over 9 million new jobs have to be created to help the labor market recover its health. Mathews pointed out that the reduction in official unemployment from 10% to 7.3% was primarily due to many people having dropped out of the labor force. Many of the new jobs that were created were lower paying jobs. Well paying jobs are important because they help stimulate demand in the economy, and will help with the economic recovery. In order to accomplish these goals, leadership is needed in the public, in Congress, in the mass media, and elsewhere.

Mathews pointed out that unfortunately, many politicians, Republican and Democrat, have been largely serving the special interests of their large campaign donors, not the American public who elected them.

Upon host David Cruz’s request, Mathews briefly discussed his upcoming book, Dollar Democracy: with Liberty and Justice for Some; How to Reclaim the American Dream for All.

[Listen]   (9 min.)

Lies of Wall Street Bailout; Hunger Hurts U.S. Economy; California Special Elections Cost Millions

Peter Mathews on KTLK AM 1150, the David Cruz Show.(Nov.25, 2013). $1 million election; hunger =$167 billion in lost productivity; bailout won with lies 

Prof. Mathews notes that as budget cuts deepen ($5 billion cut in food stamps alone), wages stagnate, and unemployment remains high, hunger and poverty has increased in the U.S., costing over $167 billion in lost economic productivity and earnings. Mathews suggests raising the minimum wage to a living wage, while compensating small business by lowering their taxes. He also shows that the more than $700 billion taxpayer bailout of Big Corporations and Wall Street did not help small businesses, American workers and homeowners on Main Street. Unlike what Treasury Secretaries Henry Paulson and Larry Summers promised Congress and the American people in order to push through the bailout, around $4 billion was spent to help small homeowners while the bulk of the $700 billion went to the Big Corporations and Wall Street Banks. These Big Banks, instead of lending money out to small businesses and struggling homeowners, used it to make more money in other ways, including parking huge amounts of it in the Federal Reserve and drawing billions of dollars of interest on it. Today, the Big Banks’ excess reserves at the Fed total more than $1.4 trillion! Not only that, many of the Wall Street Banks gave their CEO’s and other top executives millions of dollars in bonuses. Prof. Mathews told the radio audience that two excellent sources of investigative information on this debacle are Matt Taibbi’s Jan. 4, 2013 article in Rolling Stone, “Secrets and Lies of the Bailout”, and the Academy Award winning documentary, “Inside Job”, narrated by Matt Damon. Peter Mathews began his analysis by looking at the huge expense of California Special Elections that are triggered by the middle- of- the term resignation of State Senators like Sen. Bill Emmerson (R-Hemet). The $1.1 million cost of such an election can be avoided if the California Constitution was amended to allow the Governor to appoint a temporary State Senator until the next election, as he does in the case of a U.S. Senator’s death or resignation.  [Listen]  (8 min.)

Stagnant Wages Depress Consumer Spending and Make U.S. First Advanced Nation in Job Dissatisfaction

Peter Mathews on KTLK AM 1150, the David Cruz Show: (11/19/2013) Growth in pay slows from 0.4 % in second quarter to 0.3 % in third quarter for workers.

Professor Mathews points out that the drop in the growth of wages and salaries of working Americans caused a drop in consumer demand. Since consumer demand accounts for two-thirds of the economy, this has blocked our full economic recovery from the Great Recession. Stagnant wages and salaries, and a lack of supportive social programs such as guaranteed paid vacation, quality, affordable child care, and paid parental leave, which are guaranteed in Europe, have also driven deep job dissatisfaction in the United States. Mathews noted that in an online poll of American and Canadian workers, 83 % said they will actively seek a new job next year. Another poll showed that 16 % of Americans find work unbearable and hate their jobs; compared to 12 % of the British, 10 % of Germans, 9 % of French, and 7 % of Canadians. The differences in these percentages are a result of generally higher wages, a greater voice for workers in the workplace, and extensive social programs which make life easier in the other advanced countries, compared to the U.S. If the U.S. economy is to flourish once again for the benefit of working Americans, engagement and job satisfaction must be the top concern for employers. In fact, employee dissatisfaction can disrupt productivity, damage worker morale, and hurt profits.     [Listen]   (10 min.)