The just-released Good Jobs First analysis — Power Outrage: Will Heavily Subsidized Battery Factories Generate Substandard Jobs? — examines a little-known provision in the 2022 Inflation Reduction Act that may end up costing U.S. taxpayers more than $200 billion over the next decade, a sum above and beyond the $13 billion that state and local governments have promised as battery incentives.
Lawmakers see all those billions of tax dollars as a generator of good wages, but nothing in the battery subsidy fine-print mandates — or even incentivizes — decent worker paychecks. Ford Motor, for instance, will be eligible for $6.7 billion in federal subsidies for its new $3.5-billion battery plant in Michigan, and state and local officials have already handed Ford $1.7 billion for that plant.
How does that math play out for real-life workers?
“The company has promised to create 2,500 new jobs that it says will pay an average annual wage of just $45,000 a year,” Good Jobs First points out, “while reaping subsidies of $3.4 million per job.”
The Good Jobs First study offers a variety of policy proposals “to set the country’s emerging EV-battery industrial complex on the path to ‘high road’ employment,” steps ranging from requiring subsidy recipients to pay wages that at least match the local market rate to including contract provisions that “claw back” tax-dollar subsidies should companies fail to deliver the jobs they’ve promised.
Will steps like these be enough to ensure that the benefits of the transition to electric vehicles get “justly shared,” as the Good Jobs First report puts it, “with the workers and communities building America’s fossil-free economy”? Not unless we also take steps that meaningfully discourage any attempts by top corporate execs to grab much more than their “fair share” of federal tax dollars.
How could we do that discouraging? We could include in every government contract and subsidy provisions that deny public tax dollars to firms that compensate their top execs at over 25 or 50 times the compensation that goes to their workers.
A bit of historical perspective: Back in the mid-20th century, few corporate chiefs pocketed over 20 times the annual compensation of their average workers. CEOs at major U.S. corporations, the Economic Policy Institute reported last fall, are now averaging nearly 400 times worker annual pay.
If we shifted gears and only extended taxpayer-funded contracts and subsidies to corporations that limited their CEO pay to no more than 25 or 50 times worker pay, top execs at companies that get our tax dollars would have an ever-present incentive to raise their worker pay, not squeeze it.
Two municipalities, Portland and San Francisco, have already taken steps in that direction. State and federal lawmakers have introduced similar proposals, as this Inequality.org CEO-Worker Pay Resource Guide details.
We clearly can create a more equal United States. Corporate paychecks could lead the way.
This content originally appeared on CounterPunch.org and was authored by Sam Pizzigati.
Sam Pizzigati | Radio Free (2023-07-18T05:44:56+00:00) A Good Year’s Pay for a Good Day’s Work?. Retrieved from https://www.radiofree.org/2023/07/18/a-good-years-pay-for-a-good-days-work/
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