The three-pronged political attack on the very notion of retirement (except for a few)

In America, the very notion of a relatively safe and secure retirement is under relentless attack, and much of this broadside is coming from well-monied corporate interests, aided by supportive far-right politicians.

This is not by accident. Only when you connect the dots do you see a unifying force, and it’s very, very political. We haven’t been comprehending how the pieces come together because, frankly, concerns about America’s retirement funding crisis tend to be examined in silos, such as (1) Social Security; (2) public employee pension funds; and (3) 401(k) balances.

I’ve written a lot about the retirement funding crisis on this blog, but I’ve never pulled together some of the interrelated political threads. Here’s a start:

1. Attack on Social Security

Let’s open with the attack on Social Security. In reality, Social Security is among our most stable benefit programs. Although some of the concerns about the future stability of Social Security are legitimate, a relatively easy fix — raising the cap on payroll taxes that fund the program — would go a long way toward ensuring its long-term viability for generations to come.

Dave Johnson, in a piece for the Campaign for America’s Future, traces the ideological roots of the fanatical attack on Social Security:

In 1983 a couple of conservative “think tanks” developed a step-by-step plan to privatize Social Security, for the benefit of “the banking industry and other business groups.” The plan describes a strategy to convince people that Social Security is going broke and that it is a “Ponzi scheme,” to undermine confidence in the program and lead people to accept that it needs “reform.” The plan outlines methods to “neutralize” opposition. The plan involves a smokescreen strategy of saying things to distract people from seeing what they are doing.

This strategy for attacking Social Security was spelled out in a 1983 document from the Cato Institute (previously named the Koch Foundation), with Heritage Foundation input. You can read the original document for yourself, it is titled Achieving A Leninist Strategy. Please, if you have time, read the entire document (in particular the section “Weakening the Opposition”) to understand the strategy that has been unfolding in the years since . . . .

To far-right zealots, there is nothing more objectionable than a government-sponsored program that is working. Such is the case with Social Security, and hence the virulent efforts to destroy it and the support it provides to millions of retirees.

2. Corporate role in sabotaging public sector pensions

Stories about severe underfunding of America’s public employee pension plans are now becoming a daily occurrence in the media. As Matt Taibbi writes in a major piece for Rolling Stone magazine, this is pitting “private-sector workers who’ve mostly lost their benefits already against public-sector workers who are merely about to lose them.” A more insightful inside story, Taibbi suggests, is how Wall Street has looted public pension funds:

One of the primary reasons why public sector pension programs are so underfunded is that they fell prey to those who invested pension monies into the Wall Street casino, and they accordingly lost billions when it fell to pieces five years ago . . . .

It turns out, according to Taibbi, that the massive underfunding of public pension systems has been “caused almost entirely by the greed and wide-scale fraud of the financial-services industry – particularly with regard to state pension funds.” He continues:

. . . In February 2011, [economist Dean] Baker reported that, had public pension funds not been invested in the stock market and exposed to mortgage-backed securities, there would be no shortfall at all. He said state pension managers were of course somewhat to blame, but only “insofar as they exercised poor judgment in buying the [finance] industry’s services.”

In fact, Baker said, had public funds during the crash years simply earned modest returns equal to 30-year Treasury bonds, then public-pension assets would be $850 billion richer than they were two years after the crash. Baker reported that states were short an additional $80 billion over the same period thanks to the fact that post-crash, cash-strapped states had been paying out that much less of their mandatory ARC payments.

3. The 401(k) retirement “system”

Lynn Stuart Parramore, in a piece for Alternet, writes about who wins and loses when 401(k) accounts supplant pensions as a primary source of retirement funding:

Thirty years ago, as laissez-faire fanaticism took hold of America, misguided policy-makers decided that do-it-yourself retirement plans, otherwise known as 401(k)s, would magically secure our financial future in the face of gyrating markets, economic crises, unpredictable life events, stagnant wages and rampant job insecurity.

. . . There were red flags along the way. 401(k)s were originally supposed to supplement pensions, but clever corporate cost-cutters decided that voluntary individual accounts would replace them.

. . . Reality check: . . . . (T)he financial crisis destroyed America’s retirement fantasy. . . . Today, the balance in our retirement accounts falls wildly short of what we need to keep us from destitution in old age, much less to secure a comfortable existence.

To fill in the details, Parramore summons data from a new Economic Policy Institute Retirement Inequality Chartbook that provides “dozens of charts that examine retirement preparedness and outcomes by income, race and ethnicity, education, gender and marital status.”

Earlier this year, the National Institute on Retirement Security, a non-profit, non-partisan research and education center, released a 28-page study, The Retirement Savings Crisis: Is It Worse Than We Think?, by labor economist Nari Rhee, which lays out the alarming data. Here are the major findings:

New NIRS research finds retirement savings are dangerously low, and the U.S. retirement savings deficit is between $6.8 and $14.0 trillion.

…The average working household has virtually no retirement savings. When all households are included— not just households with retirement accounts—the median retirement account balance is $3,000 for all working-age households and $12,000 for near-retirement households.  

The findings confirm that the American Dream of retiring comfortably after a lifetime of work will be impossible for many. Based on 401(k)–type account and IRA balances alone, some 92 percent of working households do not meet conservative retirement savings targets for their age and income. Even when counting their entire net worth, 65 percent still fall short.

The role of individual thrift

All too often, the retirement savings crisis is described as the cumulative result of individual failures to save money. To be sure, many people in a position to save could have done, and could be doing, better in terms of personal savings levels. Too much of America’s “prosperity” has been built on buying stuff we don’t need, financed by easy credit.

But the easy credit has been extended, like cheap crack cocaine, by those who want to get us hooked early and deeply. Furthermore, the disappearance of pension plans, the flattening of personal income, high unemployment, and growing inequality of wealth in society are significant, contributing factors toward this individual “failure” to save for retirement.

Potential solutions

Increasing, not decreasing, Social Security payments and the creation of public pension systems for all are among the fixes that have been floated by policy experts in retirement funding.

But before we can get to these policy solutions, we must educate ourselves as to what and how this happened. We need to understand how we got to such a precarious, frightening place where Teresa Ghilarducci, one of the leading authorities on this subject, believes that “most middle-class Americans will become poor or near-poor retirees.”

 

Lame defenses of unpaid internships

Opposition to the intern rights movement has manifested itself in at least four types of messages, especially in the aftermath of a federal district court’s June 2013 ruling in Glatt v. Fox Searchlight Pictures that unpaid interns working on the production of “Black Swan” were entitled to pay under federal and state wage and hour laws. Scratch beneath the surface, however, and you’ll see that none of these defenses hold up.

“Hey, it worked for me!”

(version 1.0)

Version 1.0 of this defense is a sort of gentle, perhaps chiding defense of unpaid internships, coming from older graduates and grounded in the idea that hey, it worked for me, so it should work for you.  For example, in a column for the human resources magazine Workforce Management, managing editor Rick Bell waxes nostalgic about his own unpaid internship experience working for a “tough as nails” news station boss who gave him invaluable experience. He goes on to recommend a change in the law to preserve unpaid internships.

This kind of soggy remembrance (which, by the way,  one hears a lot from the non-profit sector) combines with the dubious assumption that unpaid internships are mostly about “training” and less about work.  It also raises questions about whether these sentimental defenders of unpaid internships share the personal financial pressures facing today’s heavily-indebted college students and recent graduates.

(version 2.0)

Version 2.0 covers more recent graduates for whom the unpaid intern system worked and who now can’t understand why others are complaining about it. In many cases they worked hard and proved their worth, but they may have had some assistance paying the bills while they worked for free. Some, to their credit, may have worked burdensome income-earning jobs while doing the internship.

But it’s also quite possible that they were the fortunate winners of a lottery. Consider that recent survey data by the National Association of Colleges and Employers (NACE) raises doubts about the job market clout of unpaid internships. NACE’s survey of 2013 college graduates found that among those “who had applied for a job, those who took part in paid internships enjoyed a distinct advantage over their peers who undertook an unpaid experience or who didn’t do an internship.”

NACE further reported:

Results of NACE’s 2013 Student Survey show that 63.1 percent of paid interns received at least one job offer. In comparison, only 37 percent of unpaid interns got an offer; that’s not much better than results for those with no internship—35.2 percent received at least one job offer.

In terms of starting salary, too, paid interns did significantly better than other job applicants: The median starting salary for new grads with paid internship experience is $51,930—far outdistancing their counterparts with an unpaid internship ($35,721) or no internship experience ($37,087).

This is the third consecutive year that NACE’s annual student survey has captured internship data for paid and unpaid interns; in each survey, paid interns exceeded their peers in job offers and starting salaries.

“How dare you!”

A second defense of unpaid internships carries a more ridiculing tone toward those who are challenging the practice.  For example, in 2011, CNN program host Anderson Cooper took to the airwaves to ridicule the lead plaintiffs in the lawsuit against Fox Searchlight Pictures. Apparently the son of heiress Gloria Vanderbilt just couldn’t deal with these entitled interns.

In reality, financing an unpaid internship can be a tremendous burden for someone who doesn’t appear on the Vanderbilt family tree. An unpaid summer gig in Washington, D.C., for example, may require thousands of dollars for housing, food, travel, and other essentials. For those who cannot secure such funding, the opportunities simply don’t exist.

“It’s academic!”

A third defense is coming from the higher education industry.  In 2010, for example, 15 university presidents wrote to the U.S. Secretary of Labor, urging that the Department of Labor “reconsider undertaking the regulation of internships,” which have proven to be “valuable and sought-after opportunities for American college students.”

Perhaps the most outrageous statement in the presidents’ letter is this characterization: “Some internships are paid and some, on a mutually agreed upon basis, are uncompensated.” The letter suggests that students have a degree of choice over whether they are paid, perhaps even implying that some opt not to receive compensation. In the meantime, universities that broker unpaid internships may charge tuition in return for academic credit and facilitate the flow of unpaid labor to benefit employers.

“You job-killing Commies!” 

The fourth, most hyperbolic defense of unpaid internships can only be characterized as an ideological rant.  A prime example is a Fiscal Times article by Liz Peek titled “Obama Criminalized Unpaid Internships and Killed Jobs,” published in the aftermath of the Glatt decision:

In yet another blow to young people, a federal judge has made it nearly impossible for companies to take on unpaid interns. This flies in the face of President Obama’s incessant appeal for more job training.

Turns out, President Obama loves job training programs – but only the kind that increase our budget deficit. In other words, those provided by the federal government. The private sector kind, not so much.[5]

The column closes with a personal attack on lead plaintiffs Eric Glatt and Alex Footman:

It is of course the very people that these two litigious fellows think they are helping that will be hurt by this outcome. Fox says they will appeal the decision. One can only hope so. One can also hope that these two nitwits find it challenging to land their next job.

Beyond the contemptuous rhetoric, the article avoids the obvious logic that if you want to create jobs, you can start by paying interns who engage in real work.  Furthermore, the column’s headline crosses into the ridiculous, confusing the enforcement of civil statutory provisions with criminal prosecution.

***

Many thanks to friends on the Facebook Intern Labor Rights Discussion Forum for helping me to sort through these categories.

Can religious faith help us to deal with workplace bullying?

In talking about responding to, coping with, and recovering from bullying and other forms of interpersonal abuse at work, the role of religious faith often receives only obligatory acknowledgment. For targets of workplace bullying, religion usually is tacked on to a short list of possible sources of support, along with family, friends, therapy, and coaching.

I think we need a deeper conversation about how faith can help people to deal with this form of mistreatment.

I’m probably not the best person to be raising this question. My own faith remains very much a work in progress. For much of my adult life, I considered myself a hopeful agnostic. During the past 10 years, I have come to believe in a higher force, and I sense that God’s reality is somewhere in the intersection of our major faith traditions, informed by insights from science, psychology, and spirituality. For those reasons, it probably won’t surprise people to know that I associate with Unitarian Universalism.

My own “loose parts” religious beliefs notwithstanding, I see a lot more potential for religious faith to help people through their most challenging experiences of work and vocation. While the secular workplace should not be governed by any particular set of religious beliefs, one’s personal faith and convictions can be a powerful source of strength and support in dealing with abuse of all sorts, including bullying at work.

In making these points, I am not trying to argue for or against organized religion or any specific religious beliefs. Furthermore, to anticipate what I’m sure will be one response, I readily concede that some religious institutions may harbor and enable bullying behaviors as well.

Rather, I’m looking at this from the most grounded, individual level. For those whose worldview includes an embrace of a faith tradition, I believe it can help them weather life’s storms in the workplace. I’d like to see more attention devoted to that source of support.

***

Related post

What if we applied the Golden Rule at work? (2010)

“Master and servant”: The roots of American employment law

If you need a big picture, snapshot understanding of the historical origins of American employment law, look no further than the master-servant relationship.

“Master and servant” is a legal term ported over from English common law, centuries ago. It is what it sounds like, a term deeply rooted in hierarchical, subservient personal and occupational relationships. Black’s Law Dictionary (6th ed.), an authoritative legal source, defines it this way:

The relation of master and servant exists where one person, for pay or other valuable consideration, enters into the service of another and devotes to him his personal labor for an agreed period. The relation exists where the employer has the right to select the employee, the power to remove and discharge him and the right to direct both what work shall be done and the manner in which it shall be done.

Dig into legal digests used by lawyers to research points of law and you’ll see that “master and servant” continues to be used as a topical index heading. Furthermore, the dictionary definition above connects directly to the rule of at-will employment, which allows an employer to terminate an employee for any reason or no reason at all. The U.S. is one of a few industrialized nations to retain the at-will rule as its presumptive employment relationship.

Two previous articles help to illustrate the one-sidedness of at-will employment and its significance to the modern workplace:

“On Limiting the Abusive Exercise of Employer Power” (2011)

[Law professor Lawrence] Blades noted that the underlying assumptions supporting the dominant rule of at-will employment — which allows an employer to terminate an employee for any reason or no reason at all – were no longer applicable:

Such a philosophy of the employer’s dominion over his employee may have fit the rustic simplicity of the days when the farmer or small entrepreneur, who may or may not have employed others, was the epitome of American individualism. But the philosophy is incompatible with these days of large, impersonal, corporate employers; it does not comport with the need to preserve individual freedom in today’s job-oriented, industrial society.

At-will employment and the legality of workplace bullying: A brutal combo punch (2011)

In the U.S., the combination of at-will employment and the lack of protections against workplace bullying make for a brutal combo punch that often leaves mistreated workers legally powerless.

In October I wrote a short post criticizing the rule of at-will employment, which allows an employer to terminate an employee for any reason or no reason at all. In America — in contrast to many other nations — at-will is the presumptive employment relationship.

This leaves workers especially vulnerable when they are subjected to severe workplace bullying by a supervisor, enabled by the employer. Because most bullying falls outside the protections of current employment law, workers have scant legal recourse, and employers have little incentive (at least from a liability standpoint) to act preventively and responsively.

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Messiness and creativity

My creativity is bustin' out all over

My creativity is bustin’ out all over (photo: Sandie Allen)

As the photo above suggests, this may be among the most self-justifying of blog posts: A short write-up of a recent study indicating that messiness may nurture creativity.

Marketing professor Kathleen D. Vohs (U. Minnesota) writes in Sunday’s New York Times about the results of a multi-layered study that she and her colleagues conducted:

Not long ago, two of my colleagues and I speculated that messiness, like tidiness, might serve a purpose. Since tidiness has been associated with upholding societal standards, we predicted that just being around tidiness would elicit a desire for convention. We also predicted the opposite: that being around messiness would lead people away from convention, in favor of new directions.

We conducted some experiments to test these intuitions, and as we reported in last month’s issue of the journal Psychological Science, our hunches were borne out.

I’ll let you read the full op-ed piece for a summary of how they conducted their experiments, but their bottom line is that messiness may enhance our creative impulses.

It follows that minimalist office designs, seemingly in vogue these days, may have unintended downsides:

At the same time, the working world is abuzz about cultivating innovation and creativity, endeavors that our findings suggest might be hampered by the minimalist movement. While cleaning up certainly has its benefits, clean spaces might be too conventional to let inspiration flow.

It takes all kinds

Tongue-in-cheek aside, this is not a full-blooded case for messy work settings. Tidiness has its place.

Take, for example, the term “shipshape.” It refers to “meticulous order and neatness,” according to TheFreeDictionary.com. On a ship, everything should be in its place, and for good reason: Lives may depend upon it. If you step aboard a boat, and you see gear and gadgetry randomly strewn all around the deck, be worried, very worried. (Get back ashore, or jump if you must!)

Other work settings, however, present different priorities and purposes, and insisting that everything be shipshape could be detrimental to your ultimate goals. In fact, if we want to encourage creativity and innovation, perhaps our physical work environments might best reflect the very brainstorming occurring in our heads.

To bring it back to me: Yes, a lawyer’s case files should be organized and orderly. But maybe a law professor’s office can afford a few piles here and there (and everywhere).

Dylan’s Candy Bar not so sweet to us, workers say

Workers at Dylan’s Candy Bar in Manhattan, the flagship location of a small chain of boutique candy stores opened by Dylan Lauren (daughter of fashion designer Ralph Lauren), are going public with their efforts to challenge low pay and erratic, part-time work schedules. Their claim: A store that serves as a “required stop” for celebrities and entertainers such as “Mary-Kate and Ashley Olsen, Katie Holmes, Janet Jackson, and Madonna,” with annual revenues around $25 million, isn’t all that interested in meeting with its workers to discuss their concerns.

After rebuff, a public petition

The workers have posted a public petition to build awareness and support:

Most of us started at less than $10/hour, with some of us even making as low as $8.50. We’re supposed to get annual reviews for raises, but they often forget to give us those.

On top of the low wages, our schedules and hours change week to week. Nearly the entire sales staff is part time, yet they expect us to have open availability, making it nearly impossible for us to juggle other obligations such as second jobs, school, and family. They refuse to give us any guarantee of the amount of hours we will work each week, and yet they get angry with us when we look for a second job.

. . . Unfortunately, when we got together to deliver our own petition to management, they shrugged it off. Ignoring our concerns, they simply told us that any issues regarding compensation could only be addressed in one-on-one meetings with managers and not together as a group.

The company’s willingness to meet only in one-to-one meetings is telling: It speaks of a divide-and-conquer (or perhaps divide-and-intimidate) approach, one that also makes it harder for workers to claim the protections of federal labor laws. These laws extend to employees engaged in “concerted activities for mutual aid and protection” but do not apply to employees acting solely as individuals.

The workers have reached out to the Retail, Wholesale and Department Store Union (RWDSU). This is the latest evidence of an emerging movement coming from members of America’s low-paid retail workforce, and it couldn’t come at a more important time.

Maybe Dylan’s unpaid HR intern can lend insights

It appears that Dylan’s employee relations philosophies apply to its interns as well. Earlier this year, Dylan’s posted a long announcement seeking an unpaid intern for its human resources department:

We are looking for a Human Resources Intern to join our team. The right candidate will be exposed to a dynamic and exciting opportunity for learning and growing in all disciplines in the Human Resources body of knowledge.

. . . Compensation: This is an unpaid internship, MetroCard will be provided

Among the minimum requirements was this ironic nugget: “Knowledge of the US labor regulatory environment and reporting requirements related to Human Resources.” Of course, an intern with such knowledge might rightly comprehend that the unpaid internship, with its long list of anticipated duties, probably violates minimum wage laws, as this U.S. Department of Labor fact sheet suggests. (A New York federal district court’s June decision on a lawsuit against Fox Searchlight Pictures provides further illumination on that point.)

Hmm, even with the huge, generous perk of a MetroCard, if I was the intern, I’d be giving serious consideration to joining the rest of the workers in circulating the petition.

A Note from Your Host: On blogging

Hello dear readers, just a quick note sharing some thoughts and news of a new personal blog that I started:

Learning from the testimony of others

My last post, Why targets of workplace bullying need our help: A rallying cry from the heart, reprinted a comment left by a reader, recounting her attempts to recover from a horrific, sustained campaign of bullying and mobbing. Her eloquent words inspired a lot of thoughtful comments, and I’d invite you to read them.

This exchange reinforced for me the value of social networking and this particular form of online communication as a way of sharing experiences and ideas. I know that it was especially validating for others who have experienced this form of abuse.

A new personal blog: Musings of a Gen Joneser

For some time I’ve wanted to write more about “my” generation, that group born roughly between 1954 and 1965 and dubbed by some as “Generation Jones.” I finally put together a design, wrote up a few initial posts, and gave the new blog a name: Musings of a Gen Joneser. Here are links to the first five posts:

Welcome, dear readers!

How will Generation Jones make its mark?

Fall is my most nostalgic season

Can Generation Jones talk to its animals?

Generation Jones, 9/11, and a formative decade

As you’ll see, Musings of a Gen Joneser often will take on a lighter tone than this blog, featuring a bit of pop culture and nostalgia to go with the more serious issues. On occasion there will be some overlap between it and Minding the Workplace, resulting in some cross postings between them.

Gen Jones at work

It took me a while to accept the Generation Jones label, so even though I’ve written a fair amount on generational issues here, you won’t find many references to the term. But here are three posts on work-related themes relevant to Gen Jones:

My Labor Day 2013 wish: Good, stable, bully-free jobs for Generation Jones (2013)

Retirement expert: “Most middle-class Americans will become poor or near-poor retirees” (2012)

Are you a Marathoner or a Sprinter? (2009)

Blog subscriptions

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