News & Commentary

January 29, 2014

In his fifth State of the Union address last night, President Obama pledged to sign an Executive Order to raise the minimum wage for federal contractors to $10.10 per hour. With pizza puns and references to “Mad Men,” the President also asked Congress to reduce wage inequality between men and women; pass a federal minimum wage; pass immigration reform; and extend federal jobless benefits. The New York Times, Wall Street Journaland Washington Post discuss how the President is turning to executive orders because many of his proposals will never pass through the current gridlock on Capitol Hill, while the Post also discusses the limits of the President’s wage-hike proposal. The text of the speech is available here.

The players on Northwestern University’s college football team yesterday filed the first-ever petition by college athletes to join a labor union. ESPN and the Chicago Tribune, Washington Post, Wall Street Journal, and New York Times report that the students, led by last-year’s quarterback Kain Colter, filed the petition with the National Labor Relations Board to seek union representation through the newly formed College Athletes Players Association, in partnership with the United Steelworkers. Colter explained that medical care was his biggest reason for joining a union, but he also endorsed scholarships that cannot be revoked because of injury, a trust to support players upon graduation, and the relaxing of transfer restrictions. While the Northwestern athletic director is supportive, the NCAA has responded by declaring that unionization would turn student-athletes into employees and undermine the educational purpose of college. The LA Times analyzes the implications for the rest of college athletics here, while the petition is available here.

Also in Illinois, the state’s largest government employee unions yesterday filed suit to overturn Illinois’ new pension law, the Chicago Tribune, Washington Post, and New York Times report. The suit had been long expected since last month’s passage of a bill that sought to close the state’s $100 billion unfunded public pension liability by increasing the retirement age for many workers and curbing the annual cost-of-living increases for retirees. The unions argue that the law violates the state constitution’s contracts clause and takings clause by reducing current employees’ contributions without just compensation. The complaint is available here.

Legendary folk singer Pete Seeger died Monday. With songs including “If I Had a Hammer” and a popularized rendition of “We Shall Overcome,” Seeger was influential among the labor and civil rights movements in the 1940s and 1950s, as he joined Woody Guthrie in traveling the country to sing at labor strikes and rallies. The New York Times and Washington Post offer obituaries, and the National Portrait Gallery honored Seeger yesterday with a first-floor photograph, the Post reports.

Yesterday, the New York Times profiled the creation of a new “promise zone” in Southeastern Kentucky — one of the five areas the President selected earlier this month to receive assistance from federal agencies in receiving grant funding for jobs, education, affordable housing, and public safety. The Times notes the difficulties the Kentucky Highlands have faced for decades with the decline of coal production, and also that President Obama’s plan is not new — the area was declared a “federal empowerment zone” by President Clinton in 1994 with modest results. 

In nearby Tennessee, where the United Auto Workers are organizing a Volkswagen plant, outside groups — not VW — have taken the lead in opposing the unionization effort, the New York Times reports. Governor Bill Haslam and Senator Bob Corker, among other prominent Republican politicians, have publicly argued to the rest of the South that UAW success in Chattanooga would lend momentum to unionize the Mercedes-Benz plant in Alabama and the BMW plant in South Carolina. Other organizations, from the Center for Worker Freedom to the National Right to Work Committee, have put up billboards, advertisements, and even lawsuits challenging the UAW and VW’s cooperation in forming a German-modeled union. You can read our Explainers on what makes the VW unionization drive unique here.

In California, state labor regulators dropped citations alleging that Chinese electric bus manufacturer Build Your Dreams paid workers below minimum wage, the Wall Street Journal and LA Times report. Investigators issued the citations last year after learning that BYD paid five of its employees less than the $8 an hour required by California law; the agencies dropped the citations after BYD explained that the five workers were employees of the parent company in China and were working in California on temporary assignment.

On the opinion pages, Senator Ted Cruz writes in the Wall Street Journal that the President has embarked on an “Imperial Presidency” by circumventing Congress with executive fiats. Frank Bruni of the New York Times writes that President Obama’s State of the Union was a tribute to social mobility. Eduardo Porter of the same paper argues that the government should consider returning to the lessons of the New Deal to ensure that the nation’s current long-term unemployment rate does not permanently stagnate. 

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