03/21/05

LC050321

Val Zavala>> Tonight on Life and Times --

Have unions lost their punch? Membership and wages are down,
but this labor leader is out to make a change.

Andrew Stern>> "It is time. It is so long overdue that we join
with our union allies and either change the AFL-CIO or build
something stronger that can really change workers' lives."

Val>> And remembering Lalo Guerrero, the father of Chicano
music, whose talent charmed audiences around the world.

It's all straight ahead on tonight's Life and Times.

Life and Times is made possible through the generous support of
the L.K. Whittier Foundation dedicated to improving the quality
of life by supporting innovative endeavors in the fields of
medicine, health, science and education.

And by a generous grant from Jim and Anne Rothenberg.

Val>> Union jobs are disappearing and, along with them, good
wages. A union factory job used to pay a solid twenty dollars
an hour. Now it's been replaced by so-called McJobs paying
seven or eight dollars an hour. So why the downturn and can it
be reversed? NewsHour correspondent Jeffrey Kaye tells us how
one labor leader is trying to revitalize the rank and file.

Jeffrey Kaye>> To understand how the economy and the strength
of labor unions have changed, go back to August 1992. A
Mariachi played a Mexican farewell tune as workers ended the
last shift at the last automobile factory in Southern
California. The employees at the General Motors plant, all of
them unionized, earned paid vacations, health and pension plans
and averaged what today would be twenty-one dollars an hour.
Today The Plant on the site of the old factory is a shopping
center where non-union workers make barely more than minimum
wage with few fringe benefits. This block is a metaphor for our
times, says labor analyst Kent Wong.

Kent Wong>> What we see has happened to the GM plant right here
in Van Nuys is a reflection of the shifts in the economy where
we've gone from a manufacturing or an industrial-based economy
to a service-based economy.

Jeffrey Kaye>> With the rise of a service economy, union
membership has plummeted and labor leaders are arguing over how
to revitalize their movement. The debate was prompted in large
part by this man, Andrew Stern.

Andrew Stern>> "It is time. It is so long overdue that we join
with our union allies and either change the AFL-CIO or build
something stronger that can really change workers' lives."

Jeffrey Kaye>> Stern is President of the 1.7 million member
strong Service Employees International Union, the fastest
growing union in the country. The SEIU's success has come
mostly from organizing poorly paid, often immigrant, workers in
the service economy such as security guards, healthcare
employees and janitors. The union is the AFL-CIO's largest
affiliate, but Stern has threatened to pull out of the
federation unless it makes dramatic changes.

Andrew Stern>> We've made the decision that, if nothing changes
in the AFL-CIO, we're leaving.

Jeffrey Kaye>> The AFL-CIO is a shadow of its former self.
Fifty years ago when the American Federation of Labor merged
with the Congress of Industrial Organizations, labor was among
the most powerful political forces in America.

Kent Wong>> Unions back in the 1950's represented about thirty-
five percent of the U.S. workforce, so fully one in three
workers was a member of the union. Today the percentage is
under thirteen percent and in the private sector, meaning in the
non-governmental sector, only nine percent of workers in the
United States are organized.

Jeffrey Kaye>> To help workers regain economic and political
power, Stern says the AFL has to change its structure and
financial priorities.

Andrew Stern>> It's about providing a vision to workers about
how they can win. That's what we did in our union. We gave
them a vision about how they can win.

Jeffrey Kaye>> In its battles with employers, the SEIU has
favored national and industry-wide strategies. That's what it
did five years ago to win a contract and wage increases for
striking janitors in Los Angeles.

Andrew Stern>> And all of our members from all around the
country actually struck buildings in different cities, poured
resources into the strikers, because we understood we needed to
be coordinated where, in the past, we would have let local union
and each market, you know, make it or break it on their own.

Jeffrey Kaye>> Similarly, says Stern, the labor movement would
be stronger nationally and globally with better coordination.
He wants to force the Federation's fifty-eight unions which
often compete with each other to merge into around twenty.
Stern also wants to slash the AFL-CIO's budget by returning
fifty percent of dues money to individual unions for labor
organizing.

Andrew Stern>> "We're actually talking about trying to get the
unions focused, you know, on an industry, have a strategy for
the industry, and then have the resources to accomplish that.
That's what the AFL has to do. It has to get people focused on
the right industry, make sure there are plans and make sure
there are resources."

Jeffrey Kaye>> Stern's brash critiques have put him at odds
with his former mentor, John Sweeney, who headed the SEIU before
Stern.

>> "I turn this gavel over to the next President of the AFL-
CIO, John Sweeney."

Jeffrey Kaye>> Ten years ago, Sweeney won the presidency of the
AFL-CIO with Stern's backing. Sweeney's reform slate ousted the
old guard with promises to reinvigorate the labor movement. But
union membership dropped and today, with it's own leadership
under assault, Sweeney says he wants change as much as Stern.

John Sweeney>> Andy is very bright. He's a visionary. But
it's one thing to have the vision and promote change. It's
another thing to get majority support for those changes and I
have always strived for consensus to build positive programs and
Andy doesn't have as much patience.

Jeffrey Kaye>> The stage for a showdown was set last week in
Las Vegas when union leaders gathered for their annual winter
meeting. Closed door sessions turned into a debate about
labor's priorities. Sweeney came to the plan to direct more
funds to political activity rather than labor organizing, which
Stern advocates.

John Sweeney>> "Workers are squeezed and hurting. We're making
a long-term plan to build a majority for working families in
state houses and city governments as well as the Congress and
the White House."

Jeffrey Kaye>> Sweeney said labor's political priorities should
be a campaign to fight the president's privatization plans for
social security.

John Sweeney>> "This will be the labor movement's biggest
issue's mobilization ever."

Jeffrey Kaye>> As Sweeney musters his forces, Stern and SEIU
leaders work to build alliances with other unions. In a public
show of unity, leaders of four major unions, teamsters, food and
commercial workers, laborers and the union representing hotel
and garment workers, joined Stern in calling for reform.
Teamsters President, James Hoffa, read their joint statement.

James Hoffa>> "We believe that a massive shift in resources and
focus to organizing and growth in our union core industries and
sector is the only path to rebuilding worker power in the
workplace and in the political process."

Jeffrey Kaye>> The alliance tempered Stern's threat to pull out
of the AFL-CIO.

Andrew Stern>> "The first thing, it is lonelier in November
than it is now and I feel well supported by having three of the
four largest unions in the Federation at this table along with
two of the most dynamic unions. So I think we are now in the
middle of an enormously important discussion and we're going to
keep evaluating things, you know, as this discussion continues."

Jeffrey Kaye>> These union leaders lost the first round. Their
push to direct more funds to labor organizing was turned down.

Andrew Stern>> The AFL's proposal will put less money in
organizing than the AFL is currently spending today. That's not
a plan to win. That's fake change.

Jeffrey Kaye>> And the threat to leave? Is that still on the
table?

Andrew Stern>> If the policies that the AFL-CIO has at this
meeting become the ultimate policies that are successful, that's
not the kind of AFL-CIO we would want to be part of.

Jeffrey Kaye>> Stern's most radical proposal, to force unions
to better coordinate and to merge, didn't come to a vote at the
Las Vegas meeting. Sweeney says he has facilitated mergers and
welcomes more, but not with a heavy hand.

John Sweeney>> There's such a thing as democracy. The workers
themselves have to participate in a merger. This is not about
just banging heads together and forcing them to merge.

Jeffrey Kaye>> In July, the AFL-CIO will hold its next
convention and delegates will be asked to vote on proposals
designed to reverse organized labor's downward slide.

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Val>> Only about four more weeks until tax day and here's
something your accountant is probably not telling you. You're
getting cheated. That, according to David Cay Johnston, a
Pulitzer Prize-winning reporter with the New York Times. He put
it all in his book, "Perfectly Legal", and as Philip Bruce tells
us, it's the little guy who's getting the short end of the
stick.

Philip Bruce>> David, every time the middle class complains
about taxes, we're told to get over it. The rich are paying
most of the taxes in this country. Now you say that's true, but
there are some caveats here that you found out by looking deep
within the tax code and the numbers.

David Cay Johnston>> Well, that's one way to look at it. It's
the way that those who want to cut taxes on the super rich want
you to think about it, but there are other measures. First of
all, you need to look at what's happening to incomes. The very
top incomes are exploding. They're rising very rapidly. For
the middle class, they're basically stagnant and, for people in
the bottom third of America, a hundred million Americans,
incomes are falling.

But there's another way to measure taxes, the one that President
Bush proposes. Under laws passed by both Democrats and
Republicans, the number of pennies out of each dollars that the
very rich pay in taxes are coming way, way, way down. For you
and I and everyone else in the middle class, it's rising. So
the government is taking money out of our pockets and using it
to finance tax cuts for the super rich.

Philip Bruce>> Now you've got some pretty dramatic examples of
that, in corporate America especially. Tell me about some of
those, and you name names. I have to point out that your book
is full of names.

David Cay Johnston>> Yes, including two billionaires who didn't
file a tax return for thirty years and nothing's happened to
them. Well, one of the things companies have done is that a
number of them rent a mailbox in Bermuda, then declare
themselves to be a Bermuda company resident in Barbados, another
Caribbean island. By doing that, they're able to wipe out
nearly all of their United States income tax on their profits
earned in the United States.

Ingersoll-Rand saves at least forty million dollars a year by
paying a $27,000 annual fee to the Bermuda government. It
doesn't have any offices in Bermuda. All it has is a mailbox.
And in Barbados, they have a guy who answers the telephone and
that allows them to say we're really a Barbados company, not one
in Woodcliff, New Jersey.

Philip Bruce>> You know, one of the more startling things I saw
in your book is how these fat-cat corporate jets get used for
maybe a couple of hundred dollars a trip. That's coming out of
the executive's pocket or out of the company's pocket versus
what all of us would pay if we had to take that same kind of
trip. Now how is that possible?

David Cay Johnston>> Well, in 1985 under the guise of middle-
class tax relief for people who use their car for business
purposes, Congress ordered the IRS to artificially under-value
the use of a corporate jet. So when a CEO goes from Los Angeles
to New York because he wants to go see a play or go to dinner,
he pays about a penny and a half a mile. The company, on the
other hand, shells out tens of thousands of dollars for the cost
of that trip and therefore you and I as taxpayers participate to
an enormous extent.

On a typical trip, the CEO would pay $260 in the form of
increased taxes, about a penny a mile, and the taxpayers would
lose about five thousand dollars. So literally, you're
subsidizing these guys. The system is so expensive, Phil, that,
if we bought free first-class tickets for CEOs, their spouses
and their children to go on vacation as often as they wanted,
the taxpayers would save money.

Philip Bruce>> I have to say, you're not laying this at the
Republicans' doorstep either. That would be the cliché thing.
You say this cuts across party lines. It's a Democrat and
Republican thing, right?

David Cay Johnston>> Both parties have done this in different
ways, but there's no question that both parties are doing it and
there's a reason for that. About one in 850 Americans are
important campaign contributors, so members of Congress are
thinking every day about their concerns, not yours and my
concerns. You know, most Americans, if they meet a politician,
it's "Hi, I'd like to shake your hand. I'm running for
Congress." If you're a big donor, you get to sit down with your
Congressman, explain to him what you want, and these donors
think in terms of years, not yesterday like news people do or
the next election like the politicians do.

Philip Bruce>> What is the IRS doing in terms of trying to
enforce its own laws on the wealthy?

David Cay Johnston>> Virtually nothing. There are two
billionaires I name in my book named Wildenstein who have
acknowledged under oath that, for thirty years, they never filed
a tax return while they were running a business here in America.
Nothing has happened to them. There are many businessmen I've
named, including a fellow down in Orange County named Nick
Jesson, who ran for governor of California not in the most
recent election, but in the previous one, and got one percent of
the vote in the Republican primary. He brags he doesn't pay
taxes, he's not required to pay taxes. Only after I wrote about
fifteen stories in the New York Times did the State tax
authorities finally do something about it. The IRS has done
nothing.

Philip Bruce>> And you point out that the IRS, while they may
not go after the rich, very often do target the poor for audits
and other kinds of sanctions. Now how does that work?

David Cay Johnston>> Well, during the Clinton administration,
Congress began putting more money into targeting the working
poor. So while the very rich often don't even get audited or
looked at, there's an intense scrutiny to the working poor.
Your chances of being audited if you're the working poor are one
in forty-seven. If you're very wealthy, around one in four
hundred.

In East Los Angeles, there's a woman named Maritza Reyes who
cleans other peoples' houses. She makes $7,000 a year. The
federal government came after her with its full force demanding
$7,000 from her. That's a whole year's income. It would put
her in poverty beyond what she has for the rest of her life.
Their evidence that she was a tax cheat? A half digit change in
her address.

She got a law student named Palabi Shaw to represent her in the
tax court hearing and the testimony showed that she had done
absolutely nothing wrong whatsoever and there was no reason for
the IRS to go after her. She's typical of what's happened to
many working poor people who, for whatever reason, aren't able
to make substantial incomes, but go to work every day. They are
being punished by the government.

Philip Bruce>> What's been the reaction from the business
community, from some of these names you've been naming in
"Perfectly Legal"?

David Cay Johnston>> Well, there are a lot of business people
who are very happy to see this because, if you're an honest
taxpayer and the government is not enforcing the law against
companies that are cheating, it's not fair to you. They get a
competitive advantage when you're being the good taxpayer.
There are certainly a lot of people who are very unhappy with
me. There are some CEOs who have lost their jobs. As counted
by Congress, not by me, I've shut down $258 billion dollars of
tax dodgers through my work. In fact, there's a business school
professor who calls me the "de facto chief tax enforcement
officer of the United States".

But so long as Congress provides the IRS with too little money,
nothing is really going to change on a systematic level. There
are only three thousand tax detectives at the federal government
level. Three thousand. Last year, there were about seven
hundred prosecutions for tax evasions. I name in the book
people who the government knows are tax cheats, has records on
them, and doesn't even make them pay the taxes, much less
prosecute them.

Philip Bruce>> Is this simply a matter of shedding the light of
day on this and then hoping it will go away? Or will it go
away?

David Cay Johnston>> Well, I think we can get real reform, but
you have to believe in the idea of the Founding Fathers, which
is we don't need King George to tell us how to run our
government. We will run our own government. We will make our
own decisions. If enough Americans learn how the tax system
actually operates as opposed to what the politicians have been
telling us for twenty years, which means what their donors have
been telling them to tell us for twenty years, then you talk to
your friends and neighbors, you vote -- very important to vote -
- the politicians will hear that.

If they're aware that people know what the game really is, they
will change their behavior and we'll get a tax system that
rewards people who work hard and who strive and who save and who
play by the rules instead of rewarding people who are cheats and
who are very successfully shifting the burden of taxes off of
them and onto you.

Philip Bruce>> Well, David Cay Johnston, thanks very much for
spending some time with us on Life and Times. The book is
"Perfectly Legal" and it's an eye-opener, I have to say.

David Cay Johnston>> Thank you, Phil.

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Val>> Lalo Guerrero passed away last week at the age of eighty-
eight. He was known as the father of Chicano music.

[Film Clip]

Val>> He was born in a barrio in Tucson to a father who worked
the railroad. He never finished high school and he had no
formal music education, but he had a talent for music and
recorded more than seven hundred songs.

[Film Clip]

Lalo Guerrero>> I grew up as a young boy in Arizona and my
first idols in music were Al Jolson and Rudy Vallee, Russ
Colombo and people like Eddie Cantor. I was always singing, but
I wanted to be regular pop singer of American music and I became
one and I thought I was quite good, as good as anybody, but I
never could get an opportunity to perform because it was just
unheard of for anybody that didn't look white or blonde or blue-
eyed. I couldn't survive. I couldn't make a living singing
American music, so I had to reverse to my roots and sing Mexican
music.

[Film Clip]

Lalo Guerrero>> But in the sixties when the Chicano movement
started, that's when I found the key to get my message across by
writing about certain incidents with humor to draw attention to
me. This is a song that I wrote because there are not enough
Latinos, in my estimation, in television or movies and it goes
like this.

[Film Clip]

Lalo Guerrero>> My song, "No Way, Jose", describes the
problems, the suffering, that many illegal aliens encounter when
they come across the border, injustices and discrimination.

[Film Clip]

Lalo Guerrero>> You know, I have written a lot of serious songs
and all kinds of songs and many of them have been successful.
But I would love to be remembered more for my humorous songs.

John Fronmeyer>> "Good evening, ladies and gentlemen. I'm John
Fronmeyer, Chairman of the National Endowment for the Arts, and
welcome to this, the tenth anniversary of the National Heritage
Awards."

Lalo Guerrero>> The National Endowment for the Arts gave me the
award and one of the reasons was that they said that I was a
person of writing material that was creating a better
understanding between the different ethnic groups. I'm always
writing those songs. I always write these humor songs about
current events, things that are popular and are going on right
now. That keeps it interesting, even interesting for the
audience and for me too. It's a challenge for me to write
something that is happening right now, that's current.

[Film Clip]

Val>> And that's our program for this evening. I'm Val Zavala.
For everyone at Life and Times, thanks for watching. We'll see
you next time.

Life and Times was made possible through the generous support of
the L.K. Whittier Foundation dedicated to improving the quality
of life by supporting innovative endeavors in the fields of
medicine, health, science and education.

And by a generous grant from Jim and Anne Rothenberg.

Val>> Next time on Life and Times --

Divorce is hard enough on children, but what happens when one
parent wants to take the kids and move far away from the ex?

>> What if she wants to move to Oregon in two years? What if
she wants to move to Paris in three years? Am I supposed to
follow her around the world as she exercises her rights to be
selfish? I don't think so.

Val>> That's next time on Life and Times.