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      Supreme court, Facebook, Fed: three horsemen of democracy’s apocalypse | Robert Reich

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      OpinionUS supreme courtSupreme court, Facebook, Fed: three horsemen of democracy’s apocalypseRobert ReichThese unaccountable bodies hold increasing sway over US government. Their abuses of power affect us all Sun 10 Oct 2021 01.00 EDTLast modified on Sun 10 Oct 2021 05.22 EDTThe week’s news has been dominated by the supreme court, whose term began on Monday; the Federal Reserve, and whether it will start responding to inflation by raising interest rates; and Facebook, which a whistleblower claimed intentionally seeks to enrage and divide Americans in order to generate engagement and ad revenue.‘Facebook can’t keep its head in the sand’: five experts debate the company’s futureRead moreThe common thread is the growing influence of these three power centers over our lives, even as they become less accountable to us. As such, they present a fundamental challenge to democracy.Start with the supreme court. What’s the underlying issue?Don’t for a moment believe the supreme court bases its decisions on neutral, objective criteria. I’ve argued before it and seen up close that justices have particular and differing ideas about what’s good for the country. So it matters who they are and how they got there.A majority of the nine justices – all appointed for life – were put there by George W Bush and Donald Trump, presidents who lost the popular vote. Three were installed by Trump, a president who instigated a coup. Yet they are about to revolutionize American life in ways most Americans don’t want.This new court seems ready to overrule Roe v Wade, the 1973 ruling that anchored reproductive rights in the 14th amendment; declare a 108-year-old New York law against carrying firearms unconstitutional; and strip federal bodies such as the Environmental Protection Agency of the power to regulate private business. And much more.Only 40% of the public approves of the court’s performance, a new low. If the justices rule in ways anticipated, that number will drop further. If so, expect renewed efforts to expand the court and limit the terms of its members.What about the Fed?Behind the recent stories about whether the Fed should act to tame inflation is the reality that its power to set short-term interest rates and regulate the financial sector is virtually unchecked. And here too there are no neutral, objective criteria. Some believe the Fed’s priority should be fighting inflation. Others believe it should be full employment. So like the supreme court, it matters who runs it.Elizabeth Warren tells Fed chair he is ‘dangerous’ and opposes renominationRead morePresidents appoint Fed chairs for four-year terms but tend to stick with them longer for fear of rattling Wall Street, which wants stability and fat profits. (Alan Greenspan, a Reagan appointee, lasted almost 20 years, surviving two Bushes and Bill Clinton, who didn’t dare remove him).The term of Jerome Powell, the current Fed chair, who was appointed by Trump, is up in February. Biden will probably renominate him to appease the Street, although it’s not a sure thing. Powell has kept interest rates near zero, which is appropriate for an economy still suffering the ravages of the pandemic.But Powell has also allowed the Street to resume several old risky practices, prompting the Massachusetts Democratic senator Elizabeth Warren to tell him at a recent hearing that “renominating you means gambling that, for the next five years, a Republican majority at the Federal Reserve, with a Republican chair who has regularly voted to deregulate Wall Street, won’t drive this economy over a financial cliff again.”Finally, what’s behind the controversy over Facebook?Facebook and three other hi-tech behemoths (Amazon, Google and Apple) are taking on roles that once belonged to governments, from cybersecurity to exploring outer space, yet they too are unaccountable.Their decisions about which demagogues are allowed to communicate with the public and what lies they are allowed to spew have profound consequences for whether democracy or authoritarianism prevails. In January, Mark Zuckerberg apparently deferred to Nick Clegg, former British deputy prime minister, now vice-president of Facebook, on whether to allow Trump back on the platform.Worst of all, they’re sowing hate. As Frances Haugen, a former data scientist at Facebook, revealed this week, Facebook’s algorithm is designed to choose content that will make users angry, because anger generates the most engagement – and user engagement turns into ad dollars. The same is likely true of the algorithms used by Google, Amazon and Apple. Such anger has been ricocheting through our society, generating resentment and division.US supreme court convenes for pivotal term – with its credibility on the lineRead moreYet these firms have so much power that the government has no idea how to control them. How many times do you think Facebook executives testified before Congress in the last four years? Answer: 30. How many laws has Congress enacted to constrain Facebook during that time? Answer: zero.Nor are they accountable to the market. They now make the market. They’re not even accountable to themselves. Facebook’s oversight board has become a bad joke.These three power centers – the supreme court, the Fed and the biggest tech firms – have huge and increasing effects on our lives, yet they are less and less answerable to us.Beware. Democracy depends on accountability. Accountability provides checks on power. If abuses of power go unchallenged, those who wield it will only consolidate their power further. It’s a vicious cycle that erodes faith in democracy itself.
      Robert Reich, a former US secretary of labor, is professor of public policy at the University of California at Berkeley and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
      TopicsUS supreme courtOpinionUS constitution and civil libertiesLaw (US)FacebookSocial networkingFederal ReserveUS economycommentReuse this content More

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      ‘The Great Resignation’: June’s US jobs report hides unusual trend

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      US unemployment and employment data‘The Great Resignation’: June’s US jobs report hides unusual trendJune’s numbers suggest economy is continuing to recover at steady pace – but another pattern shows people are quitting their jobs Rashida Kamal in New YorkSat 3 Jul 2021 06.00 EDTThe Bureau of Labor Statistics reported on Friday that the US economy added 850,000 jobs last month. Hidden by this encouraging figure is the hint of an unusual trend: people are beginning to quit their jobs in extraordinary numbers.June’s numbers, in combination with last month’s figures, suggest that the economy is continuing to recover at a steady pace. The rate of unemployment was 5.9% and 9.5 million people remain unemployed.This latest update, along with projections of positive economic growth, was met with notable optimism from the White House and record highs on Wall Street.Joe Biden, in response to the report, was eager to point out the changing power dynamic of the labor market.“The strength of our economy is helping us flip the script. Instead of workers competing with each other for jobs that are scarce, employers are competing with each other to attract workers,” he said.In midst of this uneven recovery, and perhaps somewhat counterintuitively, others have noticed another pattern that may further elevate unemployment rates in the months to come: people are leaving their jobs.In a move that organizational psychologist Dr Anthony Klotz calls “the Great Resignation”, workers are beginning to quit jobs in the highest rates seen since the Bureau of Labor Statistics (BLS) began to collect this data in 2000.Number of people quitting their jobsThis trend, according to Klotz, is not only due to pent-up “resignation demand” – fewer people quit their jobs during the early, uncertain months of the pandemic – but also because people are simply feeling burnt out.According to a recent report from Microsoft, 41% of the global workforce is considering leaving their jobs. Though the intention to quit is not quite the same as the act of quitting, the most recently available BLS data shows that while there were 9.3m job openings in April, almost 4 million people had also quit their jobs that month.“The economy is seemingly doing very well. There are lots of job openings out there. So, if you’re an employee, that’s empowering for you because you have options,” Klotz said.Like many other factors of American life, the Great Resignation will not be immune to the racial and economic disparities that exist elsewhere. Socioeconomic differences will shape who is quitting and why.Sandra Sucher, Harvard Business School professor and author of the forthcoming The Power of Trust, noted that low-wage workers will be particularly motivated to change jobs with even marginally better offers.“There’s definitely a sense of if I can make more money doing this job, I’ll go for it,” she said.While there are concrete factors such as better wage and improved savings rates driving these choices, experts like Sucher and Klotz also believe that the pandemic, by bringing us face-to-face with our own mortality, has prompted a reckoning with how we balance work and life.“There was overall sense of malaise that came from the experience of working, almost regardless of who you were working for during the pandemic,” Sucher said.“You want a place that takes care of you and recognizes you as a human being.”With labor market conditions seemingly turning in favor of workers, it is possible that there will better opportunities available, at least for some. Klotz has been careful to note that quitting a job is ultimately a deeply personal decision.“What I don’t want is for people to see all this coverage of the Great Resignation and think, oh, this is a good time to put my job.”Whether or not it is the right decision will still depend on a myriad of personal and particular considerations.Dr Valerie Wilson, the director of Economic Policy Institute’s Program on Race, Ethnicity and the Economy (Pree), warned against treating any one month’s report with too much importance, “The caveat is that subsequent revisions or updates to the numbers could always change what that story is. We always know more in retrospect than we do in any at any single point.”Despite the White House’s positivity, what has remained consistently evident is the disparate impact of the pandemic on different groups of people. There continues to be marked differences how long it is taking for everyone but white men to return to their pre-pandemic rates of unemployment.Race and gender groups that are recovering quicklyRace and gender groups that are recovering slowlyThese differences, of course, have been entrenched throughout US history. In particular, Wilson is concerned with “occupational segregation”, which has historically meant that Black and brown workers are disproportionately represented in some industries and not others.“For example, we know that women – women of color in particular – are more likely to be in low-wage service and those industries are hit extremely hard during a recession,” she said.Industries, such as leisure and hospitality, continue to falter in regaining their pre-pandemic rates of unemployment.Industries that are still recovering slowlyTopicsUS unemployment and employment dataEconomicsUS economyUS politicsJoe BidenfeaturesReuse this content More

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      ‘When is this going to end?’: US factory town devastated by jobs moving overseas

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      “Disbelief. Distraught and traumatized.”Just some of the words United Steelworkers Local 8-957 president Joe Gouzd used to describe how he and hundreds of other workers felt after their 56-year-old pharmaceutical plant in West Virginia was shut down, sending between 1,500 to 2,000 jobs to India and Australia.The Viatris plant at Chestnut Ridge, just outside Morgantown, has been in operation since 1965, providing well paid jobs in one of America’s poorer states. And the timing of the closure has workers furious.“This is the last generic pharmaceutical manufacturing giant in the US, and executives are offshoring our jobs to India for more profits. What is this going to do to us if we have another pandemic?” said Gouzd.It is also causing a political row, with Congress accused of inaction and workers denouncing profits before people.“When is this going to end, losing American jobs? Every politician you hear, part of their political platform is: jobs, domestic jobs, domestic manufacturing, bringing jobs and manufacturing back to America,” said Gouzd.The offshoring of jobs has taken on new political weight since Donald Trump was elected. But his record in office was just as poor as his predecessors’.While the US does not track all jobs lost to offshoring, the labor department does count the number of workers who petition for help under a federal law designed to aid those harmed by trade.According to Reuters, during the four years of Trump, those petitions covered 202,151 workers whose jobs moved overseas, only slightly less than the 209,735 workers covered under Obama.Biden has proposed taxing companies that offshore jobs, but it remains to be seen whether he will be successful. Viatris may prove his first big test.The union is fighting to prevent the plant closure, asking elected officials to repurpose the plant via the Defense Production Act of 1950. It also criticized elected officials in Congress from ignoring their pleas for assistance “for no other reason than stakeholder return on investment dollars,” said Gouzd, who has also worked at the plant for 22 years.The local union branch represents about 900 workers. “Families are going to be forced to relocate, probably sell their homes, and relocate from West Virginia. Here we’re going to rid ourselves of 2,000 high-paying jobs in north central West Virginia, taking out $150m to $200m out of the local economy from lost income.”Less than a month after Mylan merged with Pfizer’s Upjohn to form Viatris, the company informed the union of its plans to shut down the plant and send the work abroad, as part of a $1bn cost-cutting restructuring plan. Mylan reported $3.9bn in profits in 2019, and over $1bn in quarterly profits before the merger. The plant is scheduled to end manufacturing on 31 July when the majority of the workforce will be laid off, with closure operations planned to end by 31 March next year.Carla Shultz, 60, worked at the plant for 13 years and is worried about not being ready to retire, but too old to return to college or be able to find another job with comparable wages and benefits.Through her job, Shultz was able to receive chemotherapy tablets for her mother; the same medicine would have cost her family $7,000 a month without benefits for her job. During the pandemic, her mother caught coronavirus and is currently hospitalized, on oxygen, and requiring round-the-clock care.“It added a lot more stress to our already stressful situation caring for family. I also take care of my three grandchildren, two of whom are school-age. But they’ve been home a lot while schools were closed because of Covid,” said Shultz.“My sister and I take turns caring for my mom. I help in the daytime after I get off work catching a nap when I can and then keeping my midnight shift schedule. It’s not easy keeping up, but we do what we have to do for our families.”Chad McCormick, recording secretary of USW Local 8-957, has worked at the plant since 2001, but now expects to be forced to find a much lower paying job to remain in the area, where his family has lived for decades.“I’ve been here for over 20 years. I’ve since gotten married, had three children, and built a house,” said McCormick. “It’s just devastating, and a lot more people than I expected are now looking into relocating.”The West Virginia legislature passed a bill calling on governor Jim Justice and Joe Biden to save the jobs. Senators Elizabeth Warren and Marco Rubio introduced the Pharmaceutical Supply Chain Review Act to conduct a study on the American over-reliance on foreign countries in pharmaceutical industry, but neither West Virginia senator has sponsored the bill.According to Gouzd, Republican senator Shelley Moore Capito has ignored pleas to work with Biden officials to save the plant, and Democrat Joe Manchin, whose daughter served as Mylan’s chief executive until she retired in 2020, has also ignored their requests to get involved and help.Viatris cited the plant closure as part of a global restructuring initiative, and said it is exploring alternatives outside the company network.“The phasing out of manufacturing operations in Morgantown was a decision the company did not take lightly and in no way reflects upon our genuine appreciation for the commitment and work ethic of the employees at Chestnut Ridge,” it said. More

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      US Senate approves $50bn boost for computer chip and AI technology to counter China

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      The US Senate has overwhelmingly approved a bill to boost American semiconductor production and the development of artificial intelligence and other technology in the face of growing international competition, most notably from China.The 68-32 vote for the bill on Tuesday demonstrates how confronting China economically is an issue that unites both parties in Congress. It is a rare unifying issue in an era of division as pressure grows on Democrats to change Senate rules to push past Republican opposition and gridlock.The centerpiece of the bill is a $50bn emergency allotment to the US commerce department to boost semiconductor development and manufacturing through research and incentive programs previously authorised by Congress. Overall, the bill would increase spending by about $250bn, with most of the spending occurring in the first five years.The bill now heads to the House of Representatives, which earlier passed a different version. The two will have to be reconciled into a single bill before it is sent to the White House for the president’s signature.Joe Biden said he was “encouraged” by the Senate’s passage of the United States Innovation and Competition Act.“We are in a competition to win the 21st century, and the starting gun has gone off,” Biden said.“As other countries continue to invest in their own research and development, we cannot risk falling behind. America must maintain its position as the most innovative and productive nation on Earth.”Supporters described the bill as the biggest investment in scientific research that the country has seen in decades. It comes as the nation’s share of semiconductor manufacturing globally has steadily eroded from 37% in 1990 to about 12% now, and as a chip shortage has exposed vulnerabilities in the US supply chain.“The premise is simple, if we want American workers and American companies to keep leading the world, the federal government must invest in science, basic research and innovation, just as we did decades after the second world war,” said Senate majority leader, Chuck Schumer.“Whoever wins the race to the technologies of the future is going to be the global economic leader, with profound consequences for foreign policy and national security as well.“If we do nothing, our days as the dominant superpower may be ending. We don’t mean to let those days end on our watch. We don’t mean to see America become a middling nation in this century.”The bill has a number of other China-related provisions, including prohibiting the social media app TikTok from being downloaded on government devices, and would block the purchase of drones manufactured and sold by companies backed by the Chinese government.It would also allow diplomats and Taiwanese military to display their flag and wear their uniforms while in the US on official businesses, and creates broad new mandatory sanctions on Chinese entities engaged in US cyberattacks or theft of US intellectual property from US firms. It provides for a review of export controls on items that could be used to support human rights abuses.The Senate minority leader, Mitch McConnell, backed the bill but said it was incomplete because it did not incorporate more Republican-sponsored amendments.“Needless to say, final passage of this legislation cannot be the Senate’s final word on our competition with China,” he said. “It certainly won’t be mine.”Senators slogged through days of debates and amendments leading up to Tuesday’s final vote. Schumer’s office said 18 Republican amendments will have received votes as part of passage of the bill. It also said the Senate this year has already held as many roll call votes on amendments than it did in the last Congress, when the Senate was under Republican control.While the bill enjoys bipartisan support, a core group of Republican senators has reservations about its costs.One of the bill’s provisions would create a new directorate focused on artificial intelligence and quantum science with the National Science Foundation. The bill would authorize up to $29bn over five years for the new branch within the foundation, with an additional $52bn for its programs.Rand Paul, a Republican senator for Kentucky, said Congress should be cutting the foundation’s budget, not increasing it. He called the agency “the king of wasteful spending”. The agency finances about a quarter of all federally supported research conducted by America’s colleges and universities.The lead Republican on the committee also weighed in to support the bill.“This is an opportunity for the United States to strike a blow on behalf of answering the unfair competition that we are seeing from communist China,” said Roger Wicker.Senators have tried to strike a balance when calling attention to China’s growing influence. They want to avoid fanning divisive anti-Asian rhetoric when hate crimes against Asian Americans have spiked during the coronavirus pandemic.Senators added provisions that reflect shifting attitudes toward China’s handling of the Covid-19 outbreak. One would prevent federal money for the Wuhan Institute of Virology as fresh investigations proceed into the origins of the virus and possible connections to the lab’s research. The city registered some of the first coronavirus cases. More