The Illegal Employer Problem

Illegal Workers: The Cons' Secret Weapon

(excerpt by Thom Hartmann)

As David Ricardo pointed out in his 1814 treatise On Labor, there is an "Iron Law of Labor": when labor markets are tight, wages go up. When labor markets are awash in workers willing to work at the bottom of the pay scale, unskilled and semiskilled wages will decrease to what Ricardo referred to as "subsistence" levels.

Two years later Ricardo pointed out in his On Profits that when the cost of labor goes down, the result usually isn't a decrease in product prices but an increase in corporate and CEO profits. This is because the marketplace sets prices but the cost of labor helps set profits. For example, when Nike began manufacturing shoes in third world countries with labor costs below those in the United States, it didn't lead to $15 Nikes; their price held-and even increased-because the market would bear it. Instead that reduction in labor costs led to Nike CEO Phil Knight becoming a multibillionaire.

Republicans understand this very, very well, although they never talk about it. Democrats seem not to have read Ricardo, although the average American gets it at a gut level.

In the 1980's Ronald Reagan got it. His amnesty program, combined with his aggressive war on organized labor, in effect told both employers and noncitizens that there would be few penalties and many rewards for increasing the U.S. labor pool with undocumented immigrants.

The fact is that before Reagan's crackdown on organized labor, illegal immigration was never a serious problem. Take Mexico as an example. Before Reagan's presidency, an estimated 1 million people annually came to the United States from Mexico, and the same number, more or less, returned to Mexico at the end of the agricultural harvest season. Very few stayed because there were no jobs for them.

But Reagan put an end to that. One million people per year continued to cross our southern border, but they stopped returning home each fall because they were able to find permanent employment.

The magnet drawing them? Illegal employers.

Between the start of the Reagan years and today, the private workforce in the United States has gone from being about 25 percent unionized to 7 percent, according to the Bureau of Labor Statistics. Much of this is the direct result -- as César Chávez predicted -- of illegal immigrants competing directly with unionized and legal labor. Although it's most obvious in the construction trades over the past thirty years, it's hit all sectors of our economy.

Cons of both parties appreciate the impact of illegal immigrants on the U.S. workforce. During the past campaign cycle, Democratic Party strategist Ann Lewis sent out a mass e-mail on behalf of a current Democratic senator, suggesting that the United States create "an earned path to citizenship for those already here, working hard, paying taxes, respecting the law, and willing to meet a high bar for becoming a citizen." Sounds nice. The same day on his radio program, Rush Limbaugh told a woman whose husband is an illegal immigrant that she had nothing to worry about with regard to deportation of him or their children because all he'd have to do, under the new law under consideration, is pay a small fine and learn English.

The directors of Wal-Mart are smiling.

Meanwhile the millions of American citizens who came to this nation as legal immigrants, who waited in line for years, who did the hard work to become citizens, are feeling insulted, humiliated, and conned.

The Progressive Majority: Why a Conservative America Is a Myth

"Conventional wisdom says that the American public is fundamentally conservative - hostile to government, in favor of unregulated markets, at peace with inequality, wanting a foreign policy based on the projection of military power, and traditional in its social values.

But as this report demonstrates, that picture is fundamentally false. Media perceptions and past Republican electoral successes notwithstanding, Americans are progressive across a wide range of controversial issues, and they're growing more progressive all the time...

The issues covered in this report include the following:

[...]The economy - Americans support increasing the minimum wage and strong unions, and believe the wealthy and corporations don't pay their fair share of taxes."

Six Myths About Today's Workplace

"#6. Work hard and good things will come

You'll actually be rewarded only if you're likable. People get hired for their qualifications, but they get promoted because people like working with them. So spend your days trying to figure out what people need and what people want, and how you can help them. Empathy makes you likable."

Hmmm. Isn't this just a version of "it's not what you know but who you know?" I didn't necessarily agree with all of these, but it did get me thinking...

Buh Bye!

After close to two glorious years in the big office, Rich Stillman's services are no longer needed at Ivey. Apparently, his goals differ from the Board of Directors.

Yeah, right...

Don't let the door hit you on the way out!

CEOs vs. Slaves

by Barbara Ehrenreich

Recent findings shed new light on the increasingly unequal terrain of American society. Starting at the top executive level: You may have thought, as I did, that the guys in the C-suites operated as a team -- or, depending on your point of view, a pack or gang -- each getting his fair share of the take. But no, the rising tide in executive pay does not lift all yachts equally. The latest pay gap to worry about is the one between the CEO and his -- or very rarely her -- third in command.

According to a just-reported study by Carola Frydman of the Massachusetts Institute of Technology and Raven E. Saks at the Federal Reserve, thirty to forty years ago, the CEOs of major companies earned 80 percent more, on average, than the third-highest-paid executives. By the early part of the twenty-first century, however, the gap between the CEO and the third in command had ballooned up to 260 percent...

Why is it so hard for the people at the top to graciously acknowledge their dependency on the labor of others? We need some sort of gravitational force to counter the explosive distancing brought about by greed -- before our economy imitates the universe and blows itself to smithereens.

The Innovation Manifesto

Nothing grates on nerves quite like corporate-speak. It's the lingo of Type A suits everywhere, proselytizing to the inspirationally challenged while exploiting their own clip-art fetishes...

Over all, this "manifesto" uses the word innovation upwards of sixty times, defined... as "creativity applied with intention to create value." I think that means attempting to co-opt everything that's great, wring whatever money is possible out of it, and then move on to the next fad like a swarm of well-tailored locusts. By the time I got to the 25th use of the word "innovation," and was only on page three -- I was ready to proclaim that I did not think that word means what [the author] thinks it means.


Okay, quick. A show of hands where this sounds a little too familiar?

Barbarians in charge

The end of the world begins not with the barbarians at the gate, but with the barbarians at the highest level of state. -- Nigerian novelist Ben Okri

The Enthusiastic Employee (Um, they're all gone)

The Enthusiastic Employee: How Companies Profit by Giving Workers What They Want
By: David Sirota, Louis A. Mischkind, and Michael Irwin Meltzer
Publisher: Wharton School Publishing
Pub Date: January 2005

Employee enthusiasm can be an invaluable asset to a business, but 90% percent of employees become indifferent to their workplace over time, says this trio of management experts. How do they know? They’ve surveyed over four million workers in 89 countries over the past 30 years to find out (although conclusions in the book are drawn from research conducted between 1993 and 2003). So, what are the lucky ten percent of companies doing right? They’re meeting the three goals that the vast majority of employees desire at work: equity, achievement and camaraderie. And those goals go for all workers, whether they’re baby boomers, Gen X, Gen Y, or Gen D (digital). While explaining just what those terms mean, the authors provide plenty of examples of management doing things right: Former Alcoa CEO Paul O’Neill (later became the U.S. Secretary of the Treasury) met with hourly workers in the plant and gave them his home number so that they could call him if there were safety problems. Nordstrom’s employee handbook has one rule: “Use your good judgment in all situations.” Now there’s an organization that respects its workers. Numerous quotations from employees surveyed keep things brisk and absorbing. Bottom line: pure good sense on how to keep employees happy and productive. -- from Amazon.com review

Unemployment edged upward in April

"Unemployment edged upward in April and job creation fell to the lowest pace in two years, an expected sign that slow economic growth is starting to take a toll on the country's labor market.

As Wall Street digested a spate of merger talks... new data from the Bureau of Labor Statistics showed the unemployment rate rose to 4.5 percent, from 4.4 percent in March...

Overall the economy added 88,000 jobs during the month, a tepid performance compared to the 129,000 jobs added on average so far this year and the 189,000 jobs per month added in 2006. Continued job losses in the manufacturing and retail sectors were offset by continued hiring in the health-care industry and by the government."