Barack Obama wants the home stretch of his presidency to be defined by a push to change the balance of economic power in America before runaway corporate influence destroys the country. But hes not plotting any grand legislative push, and hes running low on ways to exercise executive power to act without Congress.
So now, he wants you.
At the White House on Wednesday, the administration convened a daylong Summit on Worker Voice that focused on how collective action and pro-active communication among workers, consumers, and employers alike can help steer the country off a dangerous course.
In an age where union power is at a low ebb and corporate power is at high tide, hundreds of millions of Americans are at risk of drowning economically. Ever the optimist, President Obama said he thinks all of that can change.
In a town hall forum in the East Room at the end of the summit, he sat with the co-founder of online worker organizing platform Co-Worker.org and talked at length about the mix of legal, cultural, and technological changes that could help shift power back to working people.Time to change how businesses define success
The central issue of the day was how to alleviate the pressures that lead business leaders to make decisions that undermine their employees economic security.
The overall share of business income that goes to workers has been dropping for years, while executive compensation, profit-hoarding, and spending on goodies for shareholders have all soared. This level of inequality in the workplace breeds political tension, the president observed.
"Part of the reason issues of CEO compensation are sensitive to folks is not because workers are jealous and they want lifestyles of the rich and famous," Obama said. "Its the sense that if, in fact, there are greater competitive pressures out there, how much is everybody willing to give up to meet those competitive pressures as opposed to putting it all on the backs of workers?"
Changing the way businesses think about how their profits get allocated would be a radical shift. Employers have long been incentivized to think of the wages and benefits they dole out to their workers as a burden that is best minimized.How much is everybody willing to give up to meet those competitive pressures as opposed to putting it all on the backs of workers?
The president said that mindset needs to change. He blamed the ongoing devaluation of workers on a "quarterly report mentality" where "bonuses, incentives, whether a CEO keeps his job, so much of it is just based on short-term profits."
There are a variety of proposals out there to shift corporate incentives away from that kind of short-term myopia. It's become something of a theme for Hillary Clinton who so far has called for tax incentives to reward companies that set up profit-sharing schemes for their workers, changes to how corporate stock buybacks work, and new capital gains tax rules to encourage companies to take a long view.
Such structural changes would come atop existing rules that are supposed to protect working people from bosses so fixated on minimizing their labor costs that they are willing to bend or break the law. In recent years, low-wage worker activism has illustrated just how commonly those rules fail to protect people. Fast food workers, for example, have gone on mass strikes for years to protest not just their low base wages, but also their companies' habit of cheating them on payday like forcing them to submit inaccurate timesheets.Where I grew up, it was called cheatin.
Wage theft doesn't always take that kind of brute-force approach, though. Many companies have found a simple way to avoid paying overtime or the minimum wage, reimbursing workers for expenses, helping them with tax withholding, and paying payroll taxes to fund systems like unemployment insurance and worker's compensation. Those costs and protections only kick in legally for workers defined as employees, so a company that deems its workforce "independent contractors" can sidestep it all.
"It's called 'misclassification' here in Washington. I don't like that word, because it sounds like you put it in the wrong file," Labor Secretary Tom Perez said Wednesday. "Where I grew up, it was called 'cheatin''."
Estimates about the extent of this cheatin' vary, but misclassification is especially common in the transportation industry. Legal battles over the contractor/employee distinction are still raging in many cases, with courts handing FedEx a major defeat in a class-action suit by workers who say they were cheated out of huge sums of money through misclassification. Uber is being sued in multiple venues by drivers who say they should be employees not contractors.