October 17, 2008

BILL MOYERS: Included in the large Latino community we just talked about are millions of people who work very hard for a living at very low wages. And they, in turn, are part of an even larger population that economists call "economically distressed." Translation: barely making a living, barely able to pay for the basic necessities of life, housing, food, medical care, transportation. There are almost 23 million households like that in America, 60 million individuals including 18 million children. They've gone virtually unmentioned in this campaign. Obama and McCain both talk about the middle class. These people are the forgotten class. And my next guest says it's time to bring them into the national conversation.

Michael Zweig teaches economics at the State University of New York at Stony Brook where he also runs the Center for Study of Working Class Life. This report he's just published should be must-reading for Obama and McCain and their circle of advisors from inside Washington and Wall Street.

Welcome to the JOURNAL.

MICHAEL ZWEIG: Thank you very much.

BILL MOYERS: Tell us about the people in your study. What do they do for a living?

MICHAEL ZWEIG: Well, these are people we see every day, we rely on every day. They're cashiers and truck drivers and home healthcare workers. These are people who are janitors. They're just ordinary people who, maybe they're poor but they're not necessarily poor.

What we did is we said let's take a look at the lives of people who really need help and how can we define who they are? How can we understand who these people are? So we started with housing. And we said according to the U.S. government you're not supposed to spend more than 30 percent of your income on housing. Now, I know people said, "Well, that's just nuts. Who can do that?" But that is, in fact, the government standard.

So what we did is we said, we'll take that government standard, which has been around for years, and say let's look at people whose incomes do not allow them to get above the bottom of the housing market without spending more than 30 percent of their income. And that's the numbers that you were just talking about.

BILL MOYERS: Give us a snapshot of their lives.

MICHAEL ZWEIG: Well, you know, some of these people are really having, as you say, a hard time making ends meet. We were talking in our work not only to looking at data, but we were actually talking to workers, and they talk about here's a guy who works in a grocery store, all right? He's a stocker in a grocery store. And he sees people come in who he knows don't have pets and they're buying cat food. Well, they're buying it for themselves 'cause they can't afford anything else. We have people who live and work on Long Island, but they can't afford to live there. They move to Pennsylvania in order to find a place to live. But they're still commuting back to New York to work. We, you know, have people who, when we talk about, well, what about savings, you know? Can you put any money away? And a home healthcare worker who, it came out of her mouth, "Who can afford that?" You know? So these are people who are really at the edge. And we need to talk about them. We need to have economic policies that address their condition and their needs.

BILL MOYERS: You say in here that another million of them are about to lose their homes to foreclosure.

MICHAEL ZWEIG: Well, this foreclosure problem is, of course, at the heart of the Wall Street financial crisis. But people sometimes forget is that that foreclosure problem hasn't gone away, that those junk mortgages were being issued and were being pushed out at an increasing pace until the spring of 2007 when they have a two-year reset, right? When those low terms come into these more onerous terms. So what we're going to see between now and the spring of 2009 is an acceleration of foreclosures in ordinary people's working neighborhoods. And I think that that is something we really need to pay attention to. And that's been totally off the charts, off the board.

BILL MOYERS: Why aren't we hearing about these people in this campaign?

MICHAEL ZWEIG: Well, you know, I think it's hard for the country to get past the language of the middle class. Every politician wants to talk about the middle class. But when you actually hear who they're talking about, they're talking about the bus driver. They're talking about the waitress in the cafeteria where they were eating. They're talking about people who are the janitors, who are picking up the trash out of the wastebaskets in the evening.

Those aren't middle-class people. That's the working class in this country. Most people in this country are working-class people. The work that I've done, it's about 62 percent of the labor force in the United States are just ordinary working people.

BILL MOYERS: But Obama and McCain keep talking about the middle class, the middle class. Are you saying that middle class is already disappearing?

MICHAEL ZWEIG: Well, I'm saying that the middle class is there as professional people, as small business owners, as managers. When we talk often about the disappearing middle class, we're talking about good jobs that are disappearing. But those are working class jobs. It isn't that the working class people are disappearing. The conditions of life of working class people are being pushed down. And that's been going on for 35 years.

BILL MOYERS: You call for more government spending on these people, some $220 billion, in fact.


BILL MOYERS: What would that do?

MICHAEL ZWEIG: Well, the study comes out of a desire to understand the stimulus package. As people may remember in the old days before all this Wall Street stuff was happening, people were talking about a stimulus package that could boost the economy. It could take us more towards full employment.

And the task here was that we took on in the Center for Study of Working Class Life was to design a stimulus package that would take the country towards economic prosperity but would do it in a why that would immediately serve the needs of the low-wage workers in this country or economically distressed workers. So we have a number of $220 billion that is divided into three pieces.

We have one piece of about $60 billion that increases the existing income support programs in the country like the earned income tax credit. This is a program very important. Almost no one ever talks about it. Extending employment compensation, extending food stamps and housing subsidies. That would help that community. And that would put money in their pockets. And they would spend that money. And that would help to stimulate the economy.

The second piece is to send $50 billion to the states. The states are in desperate trouble here in New York, in California, around the country. And what do they do? They cut Medicaid. They cut the programs that are important for working people. So if we could restore those budgets with the requirement that that money be spent on Medicaid and other programs that are beneficial for working people, that would be another part of this stimulus that would also go directly to the people who need it. So that's $110 billion.

The other $110 billion of this stimulus package is checks. Another round of checks. But instead of just sending the checks that was done earlier this year to basically everybody in the country, why don't we just focus that money on the people who really need it? And let's send it to the bottom half of the income distribution. Fifty-five million families in the United States and households-

BILL MOYERS: How many?

MICHAEL ZWEIG: Fifty-five million households.


MICHAEL ZWEIG: That's half. And they make $50,000 a year or less. That's who we're talking about. Send that money out. And we would stimulate the economy. You would have time to get infrastructure projects going, which take a year or two to get going. And when those infrastructure projects are in place, some of these other transfers can be backed off.

BILL MOYERS: But with all due respect, Michael, who's going to buy this? I mean, we're spending $700, $800 billion to bail out the financial system. You've got deficits rising beyond this side of heaven. You've also got the "us versus them" mentality-

MICHAEL ZWEIG: Right, right.

BILL MOYERS: -the person making $51,000 a year doesn't want to help the person making $49,000-

MICHAEL ZWEIG: Forty-nine, yeah.

BILL MOYERS: -right? So, I mean, is this really down to earth? Is this really practical?

MICHAEL ZWEIG: Well, it's first of all, it's what needs to happen. So let's start with that. So-

BILL MOYERS: Oh, that.

MICHAEL ZWEIG: Then let's say, okay, a month ago when we were talking about this is when we were first drafting it and writing it up and coming up with these numbers. People said, $220 billion, that's an impossible sum of money. Well, now we just have $700 billion that's been put on the table. And I'd like to point out that only $250 or $350 billion of that has actually been committed, right? So there's still, of that $700 billion, $350 billion that's left on the table.

Well, fine. Let's take the $350 billion that's already on the table, that's already been committed, and say, you know, instead of waiting around with this $350 billion to see if Wall Street really can use it right, why don't we take $220 billion of it, not the whole $350 billion, just $220 billion and use it in a way that we know right now is going to help the people who need it and is going to boost this economy in a way that is absolutely necessary and vital for the economic health and future of the country.

BILL MOYERS: Here's something that perplexes me and has for some time. You can have a journalist tell the story of these people, as we've done often. You can have a professional economist and professor advocate for them. But why is there no social movement, no effort by either party, by churches, by unions, by others to organize these people to help give them the muscle that they need to have the government pay attention?

MICHAEL ZWEIG: Well, there is. There is a very substantial labor movement still in this country. And as weak as it is and as limited as it is compared to what it has been in the past, there's still 13 million people or 14, 15 million people in the United States who are in unions, whether they're in AFL-CIO or in Change to Win or independent unions. There are immigrant rights organizations. There are church groups all around the country who are taking up these questions. And I think that we will see in this next round after the election, I think quite a bit more activism as people have aspirations for what the future will be like. And they will, let's hope, get active.

BILL MOYERS: But both parties see these people as voters but not constituents for the permanent coalition of governing. The next president, Obama or McCain, most likely will turn his attention to the middle class, as you say, to the financial system. And what happens to these people if they don't have muscle?

MICHAEL ZWEIG: Well, they suffer. That's what happens. And until there is organization that comes from below, that comes from the bottom, it's going to be very difficult in people's lives. And we know that is true. And I think when we did this study, one thing that we did in addition to looking at data, census data, is we made a point to go to the organizations that represent and mobilize the economically distressed on Long Island - the Long Island Federation of Labor, the Workplace Project, and Jobs with Justice. And we asked for meetings with their members. And we went and we discussed this with those people in order to not only learn what the reality of life is but also to develop a constituency and to develop some organizational capacity and let's see where it goes.

BILL MOYERS: Why do you call them economically distressed instead of that old term we used to us, you and I when we were younger, the working poor?

MICHAEL ZWEIG: The working poor. Well, that's a good question. And that's something that we learned in doing this study.

What we found out in talking to low-wage workers, is nobody wants to be low wage. Nobody wants to be poor or thought to be poor or called poor. So where we came up in the course of these conversations was that the heart of the matter was distress, that people are living a life of distress, you know? There's SOS signals going out. And so we said, well, let's talk about economically distressed workers

BILL MOYERS: But the reality is that far more people than these are hurting today. I mean, except for relatively few people at the top, there's a lot of pain in this country-


BILL MOYERS: -right now and fear as we are sinking into this recession.


BILL MOYERS: So why do you think you can organize the larger population to look at the problems of the smaller, more distressed population?

MICHAEL ZWEIG: Well, that's a task of first mobilizing that distressed population so that there is power there that people will pay attention to. But I also think that it's important for people who are in relatively better circumstances, professional people, let's say, to understand that we need to push back with allies of our own and with a social force that's powerful enough to put limits around what the corporate elite has been doing for 35 years and wants to do more of.

BILL MOYERS: One reason I want people to read this is because you go on to make a strong case for something more than these direct payments of an immediate stimulus. You talk about fundamental structural reform, universal healthcare, collective bargaining rights, better schools.


BILL MOYERS: That's the long-term-

MICHAEL ZWEIG: Right, right. The immediate needs are of the sort that we've been talking about here with this stimulus package. But just because people have a job doesn't mean that they're out of the woods.

Almost all of these economically distressed workers actually do have jobs and they work full time all year round. And they just don't make enough money. And they don't have healthcare. And they don't have good enough education for their kids. One of the things that we found in these conversations that was so interesting and so moving was the hope for the future that these workers had for their children.

So what we talked about was the need to go beyond just the immediate fix, as difficult as that is, to look at some of the more structural issues like universal healthcare programs, like having workers be able to be in unions. So in the United States today polls show that something on the order of 55 or 60 percent of workers want to be in a union if you ask them, "Do you wanna be in a union?" But only 12 percent are, right? Well, that's management resistance. And that's why something like the Employee Free Choice Act, for example, which is there to help workers more easily organize unions in the face of management opposition and more easily get to an actual contract, that's a very important structural reform.

BILL MOYERS: You go on to talk about a number of those. Do these people vote?

MICHAEL ZWEIG: Yes, they do.

BILL MOYERS: Will they vote two weeks from Tuesday?

MICHAEL ZWEIG: I have no idea. But people do vote. And working people vote. And, as a matter of fact, union households vote more than non-union households.

BILL MOYERS: Michael Zweig, I want to thank you for joining me on the Journal.

MICHAEL ZWEIG: It's been a pleasure. Thank you very much.