Raise Minimum Wage Now

The federal minimum wage of $7.25 needs to be raised. No more talk, just do it, especially if this nation is serious about getting millions of people back to work – and with some type of living wage.

Why?

If you think about the price of a gallon of gasoline flirting with $4, or higher, then you’ve answered the question.

Even so, there’s a no-holds barred debate raging nationally between business and labor about the impact of raising the minimum.

Business Versus Labor

Business groups say that raising the minimum wage discourages job creation.

For example, the National Restaurant Association says that a federal wage hike would “cause restaurant operators to make very difficult decisions to eliminate jobs, cut staff hours or increase prices.”

But labor advocates say that if workers don’t get raises, consumer spending stagnates.

“This is a critical part of recovery — to help people have more money to spend,” says Jen Kern, minimum wage campaign coordinator for the National Employment Law Project.

Let’s look at the job creation argument. Who are the jobs for?

Inside The Numbers

Many low-paid hourly jobs advertised in the classifieds, online and print, and at job posting websites offer little. They’re typically less than $10 per hour and often lack health benefits.

Sadly, it may be possible for some folks to collect more in unemployment benefits than working for such low wages. That’s hardly an incentive to get folks back to work.

Even academic studies are inconclusive, National Public Radio reports.

Some studies show that the National Restaurant Association and others like it are correct, while others show that a higher wage will stimulate spending without costing any jobs.

The good news: Seventeen states and the District of Columbia already have minimum wages set higher than the federal law. Oregon’s minimum is now $8.50 per hour.

Striking A Balance

WMB believes a balance can be struck between the needs of employers and those seeking gainful employment.

Perhaps raising the minimum wage will provide a better overall wage structure that attracts a better type of employee – one who is highly qualified and deserving of more than the minimum.

The minimum should be considered entry-level pay, for those lacking necessary experience and needed training.

Minimum wage supporters hope to prompt at least a few states to act, but no state has voted to increase the minimum wage this year.

The federal minimum wage, first enacted in 1938, was last raised in 2009, to $7.25 an hour. In 1971, the minimum wage was $1.60.

Adjusted for inflation, a worker today would have to make $8.83 an hour to have the same buying power, according to the U.S. Department of Labor.

Progressive Approach

In Illinois, for example, some lawmakers have been pushing to raise the state minimum wage up to $10.65 in steps over four years. The current minimum is $8.25 an hour, $1 more than the federal wage.

Given the realities of what it costs to live today – not only the price of a gallon of gas, but everything from the food we eat to the everyday (not designer) clothes we wear – a single-digit minimum wage in leaves us stuck in the past.

If we're serious about fixing our economic mess, let's forget for a moment about the golden-parachute CEOs and start with the folks on the bottom who just want a chance to do better.

Editor's Note: This is the last post for We Mean Business. We hope you have enjoyed our travels together across the web and our take on many things, from trends to issues.

As some wise person once said: It's the journey, not the destination, that matters most. We thank all of you for making this blog part of your personal journey!!!

Ken Cocuzzo

Planet's Got Deep Blue Trouble

Representing over 75 percent of the Earth’s surface, the ocean has long been thought to be resistant to health woes because of its ability to absorb human waste and pollution.

The ocean’s sheer volume seemed to support the notion of “dilution is the solution” to point-source contaminants. The premise: Tides and currents removed almost anything that entered the sea.

But added pressure on the marine environment – increases in human population, industry, and agriculture – has led to concerns that the ocean’s health is being harmed by human activities.

Indicators Tell Story

The ability of scientists to monitor the ocean’s health is hampered by its complexity, according to Robert J. Taylor of the University of Florida.

Although the basic chemistry of sea water has been stable for millions of years, components such as nutrients and dissolved oxygen directly affect plant and animal life.

Living populations vary naturally because of interactions between oceanic and atmospheric processes.

Evaluating the health of the planet’s oceans therefore requires that human impacts must be distinguished from a natural, changing background.

Techniques for evaluating oceanic health include estimates of commercial fishery populations and localized studies of plant and animal species.

Impacts from contaminants and adverse water quality ideally are monitored through long-term baseline studies.

In the United States, this approach has been followed by the National Oceanic and Atmospheric Administration’s Mussel Watch program.

The study focuses on organic and inorganic contaminants in mussels and oysters in U.S. coastal waters. The success of this approach has led to similar studies on an international scale.

Historical trends of contaminant input have been evaluated through “dated core” studies in which contaminants are measured in marine sediment layers and compared with estimates when they were deposited.

Larger special scales are evaluated by remote sensing to measure a variety of variables such as temperature, plankton populations, and sediment load of surface waters.

Some Major Threats

Pollution, habitat change, and overfishing are considered the major threats to oceanic health.

Pollutants include chemicals, sewage, floating debris (for example, plastic and trash), and nutrient elements (for example, nitrogen and phosphorus) released to coastal areas either directly, via rivers, or via the atmosphere.

Oceanic health is impacted almost everywhere by alteration or destruction of critical ecosystems.

These changes include the erosion and loss of all salt marshes; drainage of wetlands; siltation of estuarine areas after deforestation and erosion; alteration of fresh-water inputs; and restriction of fish migration routes by dams.

Dredging, boating, and pressure from tourism are deteriorating coral reefs around the world.

Overfishing target species, such as whales and sharks, and the accidental removal of non-target species are damaging overall ocean health.

Many fish populations have declined dramatically as a result of overfishing.

What Holds Water

Although human population and development in coastal areas continues to expand, releases of chemical contaminants and nutrients will still be regulated in developed countries.

Lessons learned in developed countries continue to help oceanic health around the world. This will enable the improvement of economies and infrastructure while preserving natural environments.

WMB believes that difficult policy innovations are required to restore and conserve ocean habitats to earlier conditions.

Growing populations dependent on fisheries as protein sources, especially in developing countries, makes this lifestyle especially important.

WMB further supports the theory that economic survival provides the impetus for maintaining and improving marine environmental conditions.

By example, fishermen need to optimize their costs per unit catch.

This could require government intervention in the form of subsidies; this is particularly important to maintain ocean-based tourism and coastal habitats for future generations.

TechMan

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ChinaWatch: Forward Frontiers

Welcome to ChinaWatch, WMB’s digest of news from the country with the world’s second largest economy and our chief rival to global dominance. Our aim is to keep you informed.


True Car Culture

After more than an eightfold increase in auto sales over the past decade, China has developed a true car culture.

Amid the buzz for last month's Shanghai auto show, ads for a single car papered entire subway stations in Shanghai, a city of 19 million people. Outside a luxury hotel, an employee is overcome as she takes photos of a red Ferrari. “Oh, it's beautiful!” she says.

Auto plants throughout China, with potted bamboo or fish tanks in break areas, are viewed as essential to the development of smaller cities of a million or more people.

After a decade of double-digit annual sales growth, excepting one year, light-vehicle sales in China topped 17 million last year. While that represented a 33 percent year-over-year increase, it was smaller than the 48 percent surge in 2009.

Still, China's growth is slowing.

Government actions held growth in the first quarter to about 8 percent, compared with a 20 percent increase in the recovering U.S. market, where sales haven't hit 17 million since 2001. Last year, U.S. sales were a below-average 11.6 million.

For Ford Motor Co. and Chrysler Group, which are still getting established in China, the slowing market means they largely missed out on a stretch of record growth, and, in some cases, profits.

Chrysler is leaning on a small business importing Jeeps, while its part owner Fiat is introducing its 500 minicar in China this year and won't have a locally built car to sell until next year. Ford's 2010 light-vehicle share was 3.4 percent.

“We could have gone faster and should have gone faster in China,” says Joe Hinrichs, CEO of Ford China.

For General Motors Co., whose sales in China last year made up 28 percent of its worldwide volume, the slowdown might mean a chance to catch its breath. After having doubled its sales in two years, GM is planning to take five years to accomplish the feat again.

Missions To Mars

U.S. President Barack Obama views China as a potential partner for an eventual human mission to Mars that would be difficult for any single nation to undertake, according to a senior White House official.

Near-term engagement with China in civil space will help lay the groundwork for any such future endeavor, says White House science adviser John Holdren.

He prefaced his remarks, before the House Appropriations subcommittee on commerce, justice and science, with the assertion that human exploration of Mars is a long-term proposition and that any discussion of cooperating with Beijing on such an effort is speculative.

“(What) the president has deemed worth discussing with the Chinese and others is that when the time comes for humans to visit Mars, it's going to be an extremely expensive proposition and the question is whether it will really make sense — at the time that we're ready to do that — to do it as one nation rather than to do it in concert,” Holdren says.

Holdren, maintaining NASA could also benefit from cooperating with China on detection and tracking of orbital debris, stresses that any U.S. collaboration with Beijing in manned spaceflight would depend on future Sino-U.S. relations.

“But many of us, including the president, including myself, including (NASA Administrator Charles) Bolden, believe that it's not too soon to have preliminary conversations about what involving China in that sort of cooperation might entail,” Holdren says.

“If China is going to be, by 2030, the biggest economy in the world … it could certainly be to our benefit to share the costs of such an expensive venture with them and with others.”

ChinaWatch

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NJ Sends The Right Message

New Jersey is a much-maligned state, sometimes with good reason, especially in the area of political corruption.

But sometimes The Garden State gets it right and does something ahead of everyone else in America, something so correct you can’t believe it needs to be spelled out in writing.

Case in point is New Jersey’s new law that bans job ads, in print or online, that only consider the employed for openings.

The job ad legislation, signed into law by Gov. Chris Christie, is necessary because some employers are discriminating against the unemployed. You must be “currently employed” to apply for positions.

Some employers and recruiters are operating under the misguided assumption there is something wrong with you if you’re out of work.

So, following this bonehead logic, you are not worth the time and effort.

Wake-Up Call

Under New Jersey’s law, which takes effect June 1, no business can post a listing for a job opening in the state that contains:

*Any provision stating that the qualifications for a job include current employment;

* Any provision stating that the employer or employer’s agent, representative, or designee will not consider or review an application for employment submitted by any job applicant currently unemployed; or

*Any provision stating that the employer or employer’s agent, representative, or designee will only consider or review applications for employment submitted by job applicants who are currently employed.

Violators will be fined $1,000 for the first offense and $5,000 for a second offense. Christie rejected as too severe original provisions calling for fines of $5,000 and $10,000, respectively.

Zero-Tolerance Needed

Frankly, WMB believes the penalties should be higher, with strict enforcement. Repeat offenders, after the second offense, should have their names published as a public service and a warning to others who would flout the law.

There is no excuse for practicing discrimination against any group of individuals. People should be judged on legitimate qualifications, knowledge and skills, period.

True, there are laws prohibiting racial, sexual, age, ethnic and religious discrimination, and various forms of bias in between.

But some employers used the Great Recession as cover for creating two classes of workers – those currently employed but seeking new jobs and those unemployed but deemed not worthy of consideration.

Talk about flawed and skewed thinking!

Debunking The Myth

Some of those who lost their jobs since 2008, through no fault of their own, were well-qualified and veteran workers across a variety of industries – construction workers, teachers, police officers, financial advisers, journalists, just to name a few.

Many of these workers had skills, knowledge, strong work ethic and, yes, higher salaries than what entry-level positions provide.

With few exceptions, nobody willingly would want to become long-term unemployed. Unemployment benefits, even generous ones, do run out. Food needs to be on the table; bills have to be paid.

And, doubters aside, many Americans still have a solid work ethic that has been handed down through generations of immigrants. That ethic is part of the thread that makes us diverse and strong as a nation.

Employers since the recession years have held all the hiring cards, especially when the numbers reflected five to seven workers for each job opening, regardless of industry.

Businesses, large and small, should carefully screen all job candidates to find the best qualified, not toss out the unemployed based on arbitrary rules and bias.

New Jersey is on the right path; others should follow its lead.

Ken Cocuzzo

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Meet The U.S. Tax Evaders

Some of the largest companies in the world don’t pay taxes! Not only is the United States incurring record debt exceeding $14 trillion, the government’s ability to collect tax revenue is ineffective.

“Companies are becoming much more sophisticated in the way they arbitrage the U.S. tax system,” says Howard Gleckman, a resident fellow at the Urban Institute, a think tank analyzing economic issues in the United States.

“Companies don’t have to be creative,” according to Robert Willens, a tax professor at Columbia Business School. “All they have to do is attribute or ascribe as much income as possible to foreign subsidiaries.”

Companies register their intangible assets including intellectual property, for example, and income outside America and register their liabilities and expenses in the United States to effectively reduce their taxable domestic income.

Ireland and the Caribbean Islands are common tax havens.

Geography Doesn't Count

“It doesn’t matter where your corporate headquarters is,’’ says Glickman. “If you’re Google, your income is I.P. … the patents aren’t even registered in the U.S.

“For drug companies, the income is earned to their Irish subsidiary. When you say that company is in the U.S., I don’t exactly know what that means.”

Critics say avoidance of corporate income tax damages the economy and diminishes domestic investment and job creation.

Defenders of current practices argue it’s the only way companies can stay competitive on a global scale since the U.S. tax rate of 35 percent is one of the highest in the world. (The average effective corporate tax rate is closer to 25 percent.)

Many believe corporations are just playing by the rules.

Public corporations generally have an obligation to their shareholders and their workers to maximize after-tax profits.

The 10 largest corporate offenders, as reported by The Daily Beast and Newsweek, are:

Exxon Mobil

Exxon Mobil’s profits were over $30 billion in 2010.

In 2009, profits were over $19 billion and yet, according to its Securities and Exchange Commission filing, received a rebate of $156 million from the Internal Revenue Service.

The company did not pay any taxes in 2009.

Google

Google last year reduced its overall tax burden by $3.1 billion with a pretax profit of $10.8 billion. By using transfer pricing, incomes are reported in foreign tax havens and liabilities are reported domestically.

Google’s patents are registered outside America, allowing it to license patents domestically and write off the expense.

General Electric

GE’s 2010 pretax profit was $14.2 billion. GE’s “innovative” accounting methods allowed it to accrue a $3.2 billion tax benefit in 2010, $833 million in 2009 and $651 million in 2008.

The company employs an entire team of former IRS and Treasury officials.

Boeing

Boeing’s 2010 pretax profit was $4.5 billion. Despite a double-digit tax rate, it has managed to escape paying federal taxes for the last three years thanks to foreign subsidiaries.

According to Citizens for Tax Justice, the company paid 0.3% of its pretax income in federal income taxes in 2010.

Pfizer

Pretax 2010 profit was $9.4 billion. Like many pharmaceutical multinationals, the company uses transfer pricing to record sales in one country to profits (on paper) in another country entirely.

Oracle

Oracle’s pretax profit was $8.2 billion and used transfer pricing (but not without implications on the Nikkei).

Phillip Morris

Its pretax profit was $5.7 billion in 2010; between 2001 and 2003 took advantage of $3.3 billion in tax breaks; effectively cutting taxes by a third.

IBM

Had a 2010 pretax profit of $19.7 billion; in 2009, the tech giant shrank its effective tax rates by nearly 10 percent by postponing the taxes it earned abroad.

Goodrich

In 2010, the company posted a profit of $804 million. In the past, the company’s effective tax rate was 11.3 percent, but it is depreciating its assets in an accelerated rate.

Time Warner

Reported a pretax profit of $3.9 billion in 2010; the merger with AOL resulted in lower taxes. Between 2001 and 2003, it cut taxes by 121 percent and paid no taxes for two years.

TechMan

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ChinaWatch: Smoking Into Space

Welcome to ChinaWatch, WMB’s digest of news from the country with the world’s second largest economy and our chief rival to global dominance. Our aim is to keep you informed.



Smoking Stamped Out

A smoking ban is now in effect in most public places in China, a move that health experts say will help raise awareness of the dangers of smoking in a country where tobacco use is deeply ingrained.

There is a lack of public awareness of the health risks of smoking in China.

The World Health Organization says seven out of 10 non-smoking adults in the East Asian nation are exposed to second-hand smoke each week. Smokers light up in elevators and offices, and even in hospital waiting rooms.

With the new ban, the country’s estimated 300 million smokers will no longer be allowed to puff their cigarettes in what the Chinese government is calling “enclosed public places.”

These include hotels, restaurants, theaters and public transport waiting rooms. The ban does not cover offices or factories.

Hong Kong University School of Public Health Director Tai Hing Lam says the ban will be effective in informing the public about the dangers of smoking.

“With this new legislation, this will promote awareness, and that is a major step,” Lam says.

He says non-smoking Chinese, who make up the majority of the population, should understand second-hand smoke is harmful to their health. He hopes the new ban will help encourage them to ask for more smoke free places.

“Non smokers at the moment are too passive, let us put it that way, because they’re so used to being exposed,” he says. “So, they do not realize that they have the right to demand it (smoke free places). Now, the law actually empowers them.”

Stepping Into Space

China may fly a woman astronaut into space next year as it embarks on an ambitious program for the next decade which includes a mission to land a rover on the moon and setting up a space station with a cargo spaceship to transport supplies.

China plans to fly two more spacecraft next year to improve the rendezvous and docking technologies and one of it will be a manned one, says Yang Liwei, deputy director of the China Manned Space Engineering Office, hinting it could as well be a woman.

China plans to carry out its first space docking between two unmanned vehicles this year, followed by one manned and one unmanned space missions next year as part of its efforts to set up a space station.

“Two to three astronauts will be sent to space in that manned mission next year,” he was quoted by the state-run China Daily as saying.

Fei Junlong, leader of China's astronaut team, says the two women astronauts and five men astronauts – the second batch of Chinese astronauts, who were selected last year – have to take a three-year training course before carrying out space missions.

But Yang says there are possibilities for the women to join next year's mission.

The two women astronauts, both pilots from the People's Liberation Army Air Force, are the first women astronauts in China. The 14 astronauts in the first batch, who were recruited in 1997, are all men.

ChinaWatch

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Go Beyond Claims To Stay Safe

Germs and bacteria are the enemy when it comes to staying healthy, so we all wash our hands. If you work in a public office setting, hand washing is frequent and part of the daily routine.
Some offices even take it a step further by installing hand sanitizers and providing antiseptic products – and some of these may come with claims that they can prevent MRSA infections.

Don’t be lulled into a false sense of security because such statements are unproven, according to the U.S. Food and Drug Administration.

MRSA (methicillin-resistant Staphylococcus aureus) is a bacterium that can cause severe – even life-threatening – infections that do not respond to standard treatment with the antibiotic methicillin.

“Staphylococcus aureus itself is a very aggressive organism,” says Dr. Edward Cox, director of FDA’s Office of Antimicrobial Products.

“It’s often associated with patients in hospitals who have weakened immune systems, but the bacterium can also cause significant skin infections and abscesses in a normal, healthy person,” Cox says.

“And it can get into the bloodstream and, less frequently, may involve the heart valve, which is very difficult to treat.”

But this antibiotic-resistant strain is even more difficult to treat. “With MRSA, a number of the antibiotic drugs we typically used often don’t work, so we lose treatment options we used to rely upon,” Cox says.

Crackdown On Claims

FDA is cracking down on companies that break federal law by promoting their products as preventing MRSA infections and other diseases without agency review and approval.

“Consumers are being misled if they think these products you can buy in a drug store or from other places will protect them from a potentially deadly infection,” says Deborah Autor, compliance director at FDA’s Center for Drug Evaluation and Research.

Examples of unproven claims found on product labels are:

•Kills over 99.9% of MRSA

•Helps prevent skin infections caused by MRSA and other germs

•Effective against a broad spectrum of pathogens, including MRSA

One company claims that its hand sanitizing lotion prevents infection from the bacterium E. coli and the H1N1 flu virus. And another firm claims its “patented formulation of essential plant oils” kills the bacterium Salmonella. These claims are also unproven and, therefore, illegal.

“FDA has not approved any products claiming to prevent infection from MRSA, E. coli, Salmonella, or H1N1 flu, which a consumer can just walk into a store and buy,” says Autor. “These products give consumers a false sense of protection.”

Advice For Consumers

•Don’t buy over-the-counter hand sanitizers or other products that claim to prevent infection from MRSA, E. coli, Salmonella, flu, or other bacteria or viruses.

•Ask your pharmacist or other health care professional for help in distinguishing between reliable and questionable information on product labels and company websites.

•In general, wash hands often, especially before handling food, to help avoid getting sick.

•Wash hands with warm water and soap for 20 seconds. For children, this means the time it takes to sing the “Happy Birthday” song twice.

Staying Safe Strategy

WMB believes the key to keeping yourself safe and protected is getting quality information from reliable sources, especially FDA. Carefully read all product labels and check all claims.

Never take anything at face value, no matter how legitimate it looks. Don’t let fear get in the way of common sense when it comes evaluating products for your personal protection.

If it sounds too good to be true, it probably is!

Ken Cocuzzo

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