We’re moving!


Hey, it’s our new website!

Really? Yes, really – but don’t fret, it’s only our blog and website that are moving – and they’re not going far.

In fact, you’ll still be able to slake your thirst for progressive policy anaylsis at our new blog home, eoionline.org/blog! And if you’re looking for our website, the address is staying the same – eoionline.org – but with a major redesign.

Can’t wait to see the new site? For the next ~24 hours, you can get a sneak peek of the new site at wp.eoionline.org.

Kinda cool, eh?

Remember, you’ll still be able to access our website from the same address at eoionline.org, but our blog will be moving to eoionline.org/blog. If you’ve got bookmarks, change ’em now!

Our new site will be faster and easier to navigate, look awesome, and put years of EOI’s high-quality research and analysis at your fingertips.

Let me also assure you that we are taking the necessary step to migrate all of our blog followers over to the new blog home. In addition, anyone with an RSS subscription to our blog will not be affected.

Lots of people have given us feedback on the news website and blog, but we would still love to hear from you. Please contact us to send us your feedback on the new blog and website, we’d love to hear from you!

– Alex, Aaron, Maggie, and the entire EOI staff

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Tuition freeze small step in right direction

john burbank

John Burbank, EOI Executive Director

As the Washington legislative session wrapped up, our legislators finally took at least one important step in the right direction. Or rather, they stopped going in the wrong direction.

It’s about time. Tuition and fees at the University of Washington are $13,000 — close to a quarter of the pre-tax income of the typical middle class family in this state. It’s not much better at Western Washington University, with tuition and fees at $8,500. At Everett Community College the state has pushed tuition and fees up to $4,000.

In 1974, the Council on Higher Education declared that “access to higher education, regardless of economic means, is a basic commitment of the State of Washington … student charges should be kept as low as possible consistent with the need to maintain a quality program of public higher education.”

The Legislature stuck to that promise for over a decade. Community college tuition and fees in 1981 were $769 in today’s dollars. UW tuition and fees were $1,726. Western tuition and fees were $1,553. Since then, community college tuition has shot up over 400 percent and UW’s has multiplied six-fold.

How did this happen? A large part of the problem is as our state has gotten richer, a disproportionate amount of the income has gone to the wealthy. And without an income tax, that money can’t be touched for higher education. At the same time, consumer purchases have shifted from goods, for which we pay sales tax, to services, which are exempt from the sales tax. So revenue for public services, like higher education, is steadily shrinking.

Colleges and universities make up the difference by raising tuition. At the UW, tuition was about $5,000 in 2000, $6,000 in 2005, $8,000 in 2010, $10,000 in 2011 — and now it is $13,000. I bet your family income did not increase by two and a half times in the 21st century!

So for next year, at least, the Legislature called a halt to this squeezing of the middle class. Now it’s time to lower tuition and make it possible for the vast majority of high school graduates to go to community college and four-year universities.

Too big a task? That’s what the Oregon Legislature has begun to do. They passed a bill to study and implement the Pay It Forward concept for financing higher education.

Students would attend college with no tuition. After graduation, they would contribute a very small percentage of their income to a higher education trust fund. Community college graduates would contribute 1.5 percent and university graduates would contribute 3 percent — all for 20 years.

Imagine — no tuition and a self-sustaining system creating debt-free access to higher education. All of a sudden we demolish the financial and psychological barriers to higher education and recognize it as a public service not just for me or you, but for the vast majority of Washington residents. Now that is a concept.

Having put one foot forward, the Washington Legislature took at least one step backward at the end of the not-so-special session. When advocates for a new program talk to a legislator, the first question he or she asks is, “what is the fiscal note” — that is, what is the cost to the state? But not this time.

Sen. Andy Hill, R-Redmond, sponsored (and the Legislature approved) a bill that will let various businesses off the hook from paying taxes at a cost of about $15 million in lost revenue. Well, that’s just an estimate, actually, there was no fiscal note when the bill passed. We do know that legislators gave Russell Investments, an investment company for the wealthy with $170 billion in assets, a juicy tax break. And they added in tax breaks for clay pigeons used for target shooting, Darigold, large privately owned aircraft, and more.

That $15 million could have provided full tuition for 3,750 students in our community colleges. Instead, Senator Hill and the Legislature favored Russell Investments over higher education for Washington residents.

Choices like this mean our Legislature will have to start raising tuition over and over again. They will have given themselves — and us — no choice. Next year, let’s hope they begin thinking about how to fund higher education, not high finance. They can do better and we can do better for our children and the generations to come.

From the Everett Herald

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Chasing South Carolina: For Boeing and Washington state, it’s a race to the bottom

This guest column was originally published in the Puget Sound Business Journal in response to "The South is winning," a three-story package by aerospace reporter Steve Wilhelm, published July 5.

This column was originally published in the Puget Sound Business Journal in response to “The South is winning,” a three-story package by aerospace reporter Steve Wilhelm.

Washington state has a world-class aerospace cluster, employing more than 130,000 people making products the rest of the world wants to buy. In 2003, Boeing cast a chill on the state, moving its headquarters to Chicago. In 2009, the chill deepened with the decision to assemble some 787s in South Carolina.

This trend continues with recent announcements to move engineering work to Southern California, start an engineering center in South Carolina and transfer computing and pilot training work, too.

One interpretation is that Boeing is so averse to unions that it will move to any region committed to suppressing unions – South Carolina being a case in point.

Stan Sorscher

Stan Sorscher,
EOI Board Member

Some industry observers and elected officials conclude that Washington state should weaken unions, to “compete.” There’s something creepy about this.

Several years ago, this argument came up at an aerospace supplier conference in Lynnwood. A local participant spoke passionately, saying that South Carolina had the right idea, and we needed to weaken worker rights in Washington, starting right now.

I reminded him that South Carolina’s Attorney General was proud that wages in South Carolina were among the lowest in the country. He was OK with sharing as little of any gains with workers as possible. Workers in South Carolina would have lower wages, and less job security. They would stay behind other states in health care, retirement, and layoff protections, and that would be good public policy.

I don’t think Washington state is ready to join South Carolina, with policies to deny workers any share of gains from productivity improvements, innovation, creativity, dedication to products and customers, or hard work.

We hear a lot about the failed contract talks and the strike in 2008 as “the reason” customers and investors were unhappy. We should recall that the 787 program suffered three years of delays and costs ballooned over $30 billion.

Sure, unions can give Boeing a convenient diversion but that distracts us from a larger truth. The 787’s problems were part and parcel of an extraordinarily risky, badly executed business strategy. The 787 was a sharp departure from the closely managed business model used successfully in the past, based on sound technical judgment, strong coordination, effective problem-solving, and close communication through the design and manufacturing organizations.

Labor costs are actually a small fraction of an airplane’s price. Learning curve and productivity gains are the real difference between success and failure in the aerospace industry. Experienced workers with good problem-solving skills drive those dramatic cost reductions.

With that in mind, it’s fair to ask, “Did Boeing learn a lesson from the 787 program?” I know my answer to that question.

To our credit, Washington state has consistently chosen a high-road strategy for economic development. We argue that productivity, innovation, creativity, customized vocational schools, world-class apprenticeship programs, and a statewide coalition of business, government, and labor coordinate to make our aerospace industry cluster an engine for shared prosperity and growth. Our high-road strategy is a competitive advantage for existing employers. It can also attract new employers to move here, either from other regions of the U.S., or from other countries. That was our state’s message at the Paris Air Show this year, and two years ago.

Look at what has happened to America in the last 40 years. Inequality is growing, wages are stagnant, production is moving overseas and a generation of young people is coming to realize that their living standards will fall short of previous generations.

I understand the impulse to chase any scrap of favor in a race to the bottom. It’s still creepy. It really says that workers and unions are not legitimate stakeholders in our democracy. With unions out of the way, other institutions of civil society will gradually be pushed aside, too, to please only global businesses.

It’s also troublesome that Washington state and Kansas delivered our incentives and political support for the 787 in 2003, and the Air Force tanker a few years ago, only to see Boeing walk back on those commitments, drawing into question the value we receive in return for public sacrifice.

Restoring prosperity is a complex national problem, with many moving parts. Still, we can’t set policies that work only for large companies. If we shift economic and political power away from workers, families and communities, that new reality will apply to all areas of public life. We will see more inequality, more insecurity, fewer opportunities and lower living standards.

A good deal works for both sides. We know when a deal works for a big employer like Boeing. We should also know when the deal works for our community. Each worker is also a customer, a neighbor, friend, or relative. We won’t do better if we all do worse.

Stan Sorscher is labor representative with the Society of Professional Engineering Employees in Aerospace (SPEEA). He can be reached at stans@speea.org.

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Join us for great food, drinks and live music at EOI’s Summer Patio Party!


Imagine a warm summer evening in Seattle. You’re in a small courtyard with friends, drink in hand. You’ve just finished a delicious dinner when the band starts another set…

Okay, stop imagining – it’s for real!

At EOI’s Summer Patio Party, you’ll enjoy an all-you-can-eat Latin-inspired dinner, two drinks (beer, wine or soda) and live music – all for just $20. Kids under 12 eat FREE, so bring the whole family!

This isn’t a fundraiser – just a celebration of our 15th anniversary with great food, fun music – and most importantly, good friends. So bring the people you love along to enjoy the party!

Questions? Contact Emily Groves at emily@eoionline.org or 206-529-6363.

See you there!

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Why this McDonald’s won’t move 20 feet into lower-wage Idaho – and other minimum wage myths, debunked

Tim Skubitz, in white, at his McDonalds in Newport, Wash., looks across the highway into Oldtown, Idaho. Photo: Jessica Robinson [KPLU]

Tim Skubitz, in white, at his McDonalds in Newport, Wash., looks across the highway into Oldtown, Idaho. Photo: Jessica Robinson [Photo: KPLU]

Why won’t this McDonald’s move 20 feet into lower-wage Idaho? | This McDonald’s is in the state with the higher minimum wage. And this busy intersection is so profitable that it didn’t occur to Skubitz to move, even when he tore down the old McDonald’s in 2011. He built a fancier new one in the same place instead of in the state right across the street with the lower minimum wage. Skibutz says wages are just one piece of a larger puzzle. [KPLU]

In case you’ve never tried, it’s impossible to survive on the minimum wage in America | A reporter at a CBS affiliate in Charlotte, NC wondered, how can people afford to live a normal life working a minimum wage job? The answer: they can’t. A minimum wage worker rarely makes enough money to support themselves on a routine, monthly basis. [CBS Charlotte]

Small businesses, Fed economists agree minimum wage increase will boost economy | Economists at the Chicago Federal Reserve Bank say raising the minimum wage by $1.75 would increase household spending by about $48 billion the following year (about .3 percent of GDP). A new poll finds 67% of small-business owners support increasing the federal minimum wage and adjusting it yearly to keep up with the cost of living. [ThinkProgress, Miami Herald]

Costco leads, Wal-Mart extorts delivers ultimatum on minimum wage increase | Costco President and CEO Craig Jelinek is putting his name and company in the forefront of the latest drive to increase the federal minimum wage. Meanwhile, Wal-Mart says it won’t build in the city because Washington DC leaders voted to increase the District’s minimum wage. [Puget Sound Business Journal, Washington Post]

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City of Seattle leaders to hear first report on paid sick days ordinance

child sneeze

Photo: SCA Svenska Cellulosa Aktiebolaget via Flickr

The results from a baseline evaluation of Seattle’s paid sick and safe time law show exactly why paid sick leave standards are needed to protect public health: Absent laws requiring employers to provide sick leave, it is one of the least likely benefits to be offered in the private sector – and part-time workers are rarely covered.

University of Washington researchers surveyed employers about the leave policies and practices they had in place before Seattle’s paid sick and same time ordinance went into effect – and they’ll present their findings to the Seattle City Council today at 3:10 p.m.

The researchers found that over a quarter (27%) of companies now covered by Seattle’s law offered no sick leave or PTO to full-time workers, and 65% provided none to part timers. Not only did many employers not provide paid sick leave, but people came to work sick even when they have paid leave. 44% of employers with sick leave reported that sometimes people still show up to work sick.

The report also shows how important comprehensive coverage is in sick leave standards. The Seattle survey found that over half of covered employers have fewer than 20 employees, and employment is across all sectors. In other states and cities, paid sick days laws exclude broad swaths of workforce, such as companies with fewer than 20 – or even 50 – employees.

Other laws exclude whole sectors of the economy. Such exclusions have significant negative impacts on public health, family economic security, and community vitality. Children’s health and their ability to succeed in school is also significantly affected by the parents’ access to sick leave to deal with their children’s health needs. So we can be proud of Seattle’s ordinance – both for the number of people it covers, and for the forward-looking local business owners who helped craft and pass it.

Finally, the UW report shows that continued public outreach is important for the law’s success. City officials have done a good job so far given limited resources, holding workshops for small business owners throughout the city and providing individual technical assistance. In fact, the City of Seattle did far more outreach than other localities have with similar laws. The fact that 60-70% of small and mid-sized firms knew about the ordinance on the eve of it going into effect is encouraging – but obviously more needs to be done.

Policy change, like Seattle’s ordinance, is one part of what’s needed to bring about a cultural shift that supports healthy workplaces and families. Changes in thinking and practice about the environment, women’s and civil rights required a similar combination of legal and cultural shifts.

Later phases of the evaluation will reflect changes and experiences from the perspectives of both employers and employees after implementation of the ordinance. We can expect to find that employees will offer a very different perspective, and that outreach to individual workers – many of whom don’t live in Seattle – is more difficult than to employers. Employers’ responses, once they have experience with the ordinance, can be expected to be mostly positive, based on recent studies of similar ordinances in San Francisco and Washington, DC.

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U.S. economy added 195,000 jobs in June, employment-to-population ratio edges up

This article originally appeared in CEPR's Job Bytes

This article, by Dean Baker, originally appeared in CEPR’s Job Bytes

The Labor Department reported the economy added 195,000 jobs in June. With upward revisions to the prior two months data, this brings the average gain over the last three months to 196,000. While the unemployment rate was unchanged at 7.6 percent, the employment-to-population ratio (EPOP) edged up to 58.7 percent, the highest since last November.

Job growth was again heavily concentrated, with restaurants (51,700), retail trade (37,100) and employment services (18,600) accounting for more than half of the job growth in June. Total job growth in these sectors has averaged 105,000 over the last three months. These are all low-paying sectors to which workers turn when better-paying jobs are not available.

Interestingly, there appears to have been a modest uptick in wage growth with the average hourly wage rising at a 2.1 percent annual rate over the last three months compared with the prior three months. However this acceleration only applied to supervisory workers who saw average wage growth of 3.0 percent over this period, compared with just 1.7 percent for non-supervisory workers.

EOI Board Member Dean Baker

EOI Board Member Dean Baker, co-director of the Center for Economic and Policy Research in Washington, DC

Other sectors with substantial job growth in June were health care (19,800) and finance (17,600). This was the strongest growth in finance since March of last year. Construction added 7,000 jobs after losing jobs the prior two months. Part of this weakness is a seasonal issue. The unusually mild winter meant more jobs were added in the winter months, leading to less growth in the spring/summer. Manufacturing lost 6,000 jobs, the fourth straight decline. This is consistent with other data showing continuing weakness in manufacturing. The government sector lost 7,000 jobs with the federal government accounting for 5,000 of the lost jobs. State governments shed 15,000 jobs, but local governments added 13,000.

Most of the data in the household survey was positive. The share of unemployment due to people voluntarily quitting their jobs rose to 8.8 percent, the highest level since December of 2008. The duration measures all fell with the share of long-term unemployed, dropping to 36.7 percent -the lowest since October of 2009. Of course the shortening of the period of benefits has likely been an important factor here as losing eligibility often leads people to drop out of the workforce and therefore not be counted as unemployed. On the negative side, the number of people involuntarily working part-time rose by 314,000 to the highest level since last October.

There were some interesting quirks in the data. The rise in employment-to-population ratio (EPOP) is showing up most strongly among the foreign-born population. The EPOP for the foreign-born population stood at 62.9 percent in June, up 1.3 percentage points from its year-ago level and 3.4 percentage points from the low-point of the downturn in January of 2010. By comparison, the EPOP of the native-born population was 58.3 percent, down by 0.1 percentage points from its year-ago level.

There is also an interesting pattern in unemployment by educational attainment. The unemployment rate for workers without high school degrees fell to 10.7 percent in June. This is down from peaks of more than 15 percent in 2010. Given that their pre-recession unemployment rate averaged over 7.0 percent, there is little evidence of a clear shift in demand away from less-educated workers in the upturn.

This job report was somewhat better than had generally been expected, especially with the upward revisions to the prior two months’ data. There are still serious grounds for concern about the strength of the economy going forward. Job growth is unusually highly concentrated in low-paying sectors.

This is not a sign of a healthy labor market. In this respect, it is striking that we continue to see a respectable rate of job creation in an economy that is growing at less than a 2.0 percent annual rate. The trend rate of growth is usually estimated at 2.2 to 2.4 percent. The other point worth remembering is that even at the 195,000 job pace of the last three months, it would take us to the end of the decade to make up the economy’s 8.5 million job deficit.

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