Tag Archives: low-income

1 million could lose food stamps in 21 states, including Wisconsin

More than 1 million low-income residents in 21 states could soon lose their government food stamps if they fail to meet work requirements that began kicking in this month.

The rule change in the federal Supplemental Nutrition Assistance Program was triggered by the improving economy – specifically, falling unemployment. But it is raising concerns among the poor, social service providers and food pantry workers, who fear an influx of hungry people.

Recent experience in other states indicates that most of those affected will probably not meet the work requirements and will be cut off from food stamps.

For many people, “it means less food, less adequate nutrition. And over the span of time, that can certainly have an impact on health – and the health care system,” said Dave Krepcho, president and chief executive of the Second Harvest Food Bank of Central Florida.

Advocates say some adults trying to find work face a host of obstacles, including criminal records, disabilities or lack of a driver’s license.

The work-for-food requirements were first enacted under the 1996 welfare reform law signed by President Bill Clinton and sponsored by then-Rep. John Kasich, who is now Ohio’s governor and a Republican candidate for president.

The provision applies to able-bodied adults ages 18 through 49 who have no children or other dependents in their home. It requires them to work, volunteer or attend education or job-training courses at least 80 hours a month to receive food aid. If they don’t, their benefits are cut off after three months.

The U.S. Department of Agriculture can waive those work rules, either for entire states or certain counties and communities, when unemployment is high and jobs are scarce. Nearly every state was granted a waiver during the recession that began in 2008. But statewide waivers ended this month in at least 21 states, the largest group since the recession.

An Associated Press analysis of food aid figures shows that nearly 1.1 million adults stand to lose their benefits in those 21 states if they do not get a job or an exemption. That includes about 300,000 in Florida, 150,000 in Tennessee and 110,000 in North Carolina. The three states account for such a big share because they did not seek any further waivers for local communities.

In Tennessee, Terry Work said her 27-year-old deaf son recently was denied disability payments, meaning he is considered able-bodied. And that means he stands to lose his food stamps, even though she said her son has trouble keeping a job because of his deafness.

“I know there’s going to be a lot of people in the county hurt by this,” said Work, founder of Helping Hands of Hickman County, a social service agency in a community about an hour west of Nashville.

Nationwide, some 4.7 million food stamp recipients are deemed able-bodied adults without dependents, according to USDA. Only 1 in 4 has any income from a job. They receive an average of $164 a month from the program.

In states that already have implemented the work requirements, many recipients have ended up losing their benefits.

Wisconsin began phasing in work requirements last spring. Of the 22,500 able-bodied adults who became subject to the change between April and June, two-thirds were dropped from the rolls three months later for failing to meet the requirements.

Some states could have applied for partial waivers but chose not to do so.

North Carolina’s Republican-led government enacted a law last fall accelerating implementation of the work requirements and barring the state from seeking waivers unless there is a natural disaster. State Sen. Ralph Hise said the state was doing a disservice to the unemployed by providing them long-term food aid.

“People are developing gaps on their resumes, and it’s actually making it harder for individuals to ultimately find employment,” said Hise, a Republican who represents a rural part of western North Carolina.

In Missouri, the GOP-led Legislature overrode a veto by Democratic Gov. Jay Nixon to enact a law barring the state from waiving work requirements until at least 2019. The three-month clock started ticking Jan. 1 for 60,000 people in Missouri, where unemployment is down to just 4.4 percent.

“We were seeing a lot of people who were receiving food stamps who weren’t even trying to get a job,” said the law’s sponsor, Sen. David Sater, a Republican whose Missouri district includes the tourist destination of Branson. “I know in my area you can find a temporary job for 20 hours (a week) fairly easily. It just didn’t seem right to me to have somebody doing nothing and receiving food stamps.”

Others say it’s not that simple to find work, even with an improving economy.

Joe Heflin, 33, of Jefferson City, said he has been receiving food stamps for more than five years, since an injury ended his steady job as an iron worker and led to mental illness during his recovery. He said he gets nearly $200 a month in food stamps and has no other income. Heflin was recently notified that his food stamps could end if he doesn’t get a job or a disability exemption.

“I think it’s a crummy deal,” Heflin said while waiting in line at a food pantry. “I think they ought to look into individuals more, or at least hear them out. … I depend on it, you know, to eat.”

Policymakers often “don’t realize a lot of the struggles those individuals are dealing with,” said Mariana Chilton, director of the Center for Hunger-Free Communities at Drexel University in Philadelphia.

Some are dealing with trauma from military service or exposure to violence and abuse, Chilton said. Others have recently gotten out of prison, making employers hesitant to hire them. Some adults who are considered able-bodied nonetheless have physical or mental problems.

A study of 4,145 food stamp recipients in Franklin County, Ohio, who became subject to work requirements between December 2013 and February 2015 found that more than 30 percent said they had physical or mental limitations that affected their ability to work. A similar percentage had no high school diploma or equivalency degree. And 61 percent lacked a driver’s license.

“There should have been more thought on how we look at employment and not thinking that people are sitting there, getting food stamps because they are lazy and don’t want to work,” said Octavia Rainey, a community activist in Raleigh, North Carolina.

Some states have programs to help food stamp recipients improve their job skills. Elsewhere, it’s up to individuals to find programs run by nonprofit groups or by other state agencies. Sometimes, that can be daunting.

Rainey said people who received letters informing them they could lose their food stamps sometimes were placed on hold when they called for more information – a problem for those using prepaid calling cards. And in Florida, food aid recipients received letters directing them to a state website for information.

“A lot of these folks, they don’t have computers, they don’t have broadband access,” said Krepcho, the Central Florida food bank executive. “That’s ripe for people falling off the rolls.”

Senators press leadership to extend student loan program

Wisconsin Democrat Tammy Baldwin and 53 colleagues pressed the Senate leadership in late October to extend the federal student loan program that expired on Sept. 30.

The House unanimously voted on Sept. 28 for an extension but the Perkins loan program expired with the new fiscal year due to Senate inaction.

Baldwin, Democratic Sen. Robert Casey of Pennsylvania and Republicans Susan Collins of Maine and Rob Portman of Ohio led a bipartisan coalition in sending a letter to Majority Leader Mitch McConnell and Minority Leader Harry Reid demanding reauthorization of the program. 

The letter was signed by 54 members, including 11 Republicans, demonstrating a bipartisan majority supports an extension.

Since the program expired more than a month ago, senators twice attempted to reauthorize the loan program with a “unanimous consent” request.

The Perkins program has existed with bipartisan support since 1958 and has provided more than $28 billion in loans to students in all 50 states. In the last academic year, more than 500,000 students received $1.1 billion in loans, according to Baldwin’s office.

The program provides low-interest loans to help low-income students finance the costs of post-secondary education at about 1,700 participating institutions.

In Wisconsin, Baldwin said the program “provides more than 20,000 low-income students with more than $41 million in aid, and it is my top priority to fight to ensure it continues for generations to come.”

University of Wisconsin System president Ray Cross said in a statement that the program helped about 15,800 of the system’s students go to school in 2013–14, providing nearly $29 million in loans. The program helps about one in every 11 students enrolled in the UW System.

“The expiration of the Federal Perkins Loan Program today is a loss for students in the University of Wisconsin System and across the United States,” Cross said. “We will continue to work with our delegation and others in Congress to explore any alternative avenues to maintain the program.”

Baldwin urged the Senate leadership to “heed this bipartisan call” and immediately act to reauthorize the program.

U.S. Sen. Ron Johnson, R-Wis., also signed the letter, which said, “Thousands of current and future students face uncertainty and hundreds of institutions are struggling to find another way to help their neediest students afford their education.”

Minnesota offers region’s highest minimum wage

Minnesota this week vaults past Illinois, Michigan and South Dakota to gain the highest minimum wage in the Midwestern region at $9 an hour, which also will rank among the most-generous state wage floors in the country.

The dollar-per-hour bump taking effect on Aug. 1 for some 288,000 of Minnesota’s lowest-paid workers is the second of a three-stage increase adopted in 2014, when the state had one of the lowest minimum wages in the region. Next August, the wage will rise again to $9.50 and it will go up automatically with inflation in following years.

For now, this step gives Minnesota the highest minimum wage of any state away from the east or west coasts. The next closest in the region are South Dakota’s $8.50, Illinois’ $8.25 and Michigan’s $8.15.

Minnesota Gov. Mark Dayton, a Democrat who signed the new wage law last year, said Monday the higher wage is about “allowing people to earn a better living through their work. We’re not talking about handouts here. We’re talking about rewarding people who work with a better income, which makes them better citizens.”

Someone working full time at the minimum wage could earn $2,000 more per year, but Dayton said their overall income would still leave them too close to the federal poverty line.

“People aren’t flying out to New York to spend this money. They’re spending it in their local economy,” Dayton said in an interview with The Associated Press. “That’s what drives our economy forward. It’s not trickle-down economics. It’s consumer spending.”

Dan McElroy, who leads the restaurant and lodging trade group Hospitality Minnesota, said consecutive years with steep minimum wage increases has forced businesses to adjust with big spikes to labor costs. Minnesota’s minimum wage before the 2014 law had been $6.15 per hour, although most employers with those workers had to comply with a $7.25 federal minimum.

To compensate, McElroy said some restaurants have introduced technology that allows servers to handle more tables or customers order at tables through tablets. Others have shortened service hours, he said. One border-town cafe owner gained widespread attention for tacking a 35-cent minimum wage fee onto customer tabs.

“It has had challenges, and they’re frustrating but they’re not dire,” McElroy said. “We will know more when we see how many fewer jobs we have per establishment. But those things take time to happen.”

Small Minnesota employers – those with annual gross revenue below $500,000 – still will be permitted to pay workers less, with their minimum wage matching the federal minimum. Businesses can also pay trainees at the lower rate for 90 days, and teens can be paid less, too.

Washington and Oregon currently have the nation’s highest minimum wages at $9.47 and $9.25 per hour, with five others at or just above $9. The wages in California and Massachusetts will rise to $10 per hour in January.

Minnesota’s latest increase leaves a wider gap between its wage floor and that of neighboring Wisconsin.

Wisconsin state Sen. Jennifer Shilling, a Democrat whose district is just across the Mississippi River from Minnesota, bemoaned the lack of interest from Gov. Scott Walker and Republicans in Madison to raise that state’s $7.25 per hour minimum wage.

“While states like Minnesota are raising family wages and growing their middle class, Republicans in Wisconsin have taken our state in the opposite direction,” Shilling said in an email. “Despite the national economic recovery, working families in Wisconsin continue to struggle as a result of declining wages, a shrinking middle class and massive cuts to schools and local communities.”

When Walker announced his presidential campaign two weeks ago, he ridiculed Democrats pushing for minimum-wage increases.

“The left claims they’re for American workers, and they’ve got lame ideas, things like minimum wage,” Walker told Fox News in an interview. “We need to talk about how we get people skills and qualifications they need to get jobs that go beyond minimum wage.”

Right-wing bias, political jockeying conspire to derail Milwaukee’s streetcar proposal

Update Feb. 10: The Milwaukee Common Council approved the streetcar connecting downtown to the lower east side the morning of Feb. 10. 


Streetcars and light rail systems are central to America’s growing re-urbanization — the counterpunch to last century’s urban flight. Although critics often dismiss them as “trendy,” you’ll find such systems today in down-to-earth cities such as Oklahoma City, Kansas City and Cincinnati. Leaders in conservative metro areas such as Salt Lake City rave about them. They’re an integral part of 21st–century urban landscapes in nearly every corner of the nation — Portland and Seattle, Tucson and Phoenix, Atlanta and Nashville, Philadelphia and Boston.

Many of the cities that have added streetcars or light rail to their public transportation options over the past couple of decades consider them great successes. Portland, Oregon, which pioneered the streetcar’s return, reports that $3.5 billion has been invested within two blocks of its streetcar lines, resulting in 10,212 new housing units and 5.4 million square feet of office, institutional, retail and hotel construction.

Not every city can report the spectacular results of Portland’s streetcar, and some systems do have flaws that are touted by naysayers intent on finding them. But it’s accurate to say that the scores of streetcar projects that have been built over the past two decades have proven overwhelmingly popular. They’ve benefited their local economies and provided an additional mode of transportation that gets large numbers of people out of their cars and into their streets, where they can get around without dealing with parking hassles. 

Milwaukee is the most densely populated city in the nation without any rail component in its pubic transportation mix —yet.

The taste of Koch

Approval for Milwaukee’s streetcar initially seemed like a slam-dunk. The city’s major business interests are so firmly behind it that several of them took out a full-page ad supporting the project in the Milwaukee Journal Sentinel.

The ad, headlined as an “open letter to the City of Milwaukee,” read: “We have a once-in-a-generation opportunity to propel Milwaukee forward in a bold new direction that will positively impact the future of our great city for decades. If we don’t reinvest in our community, fewer people will locate here, existing citizens will leave, and it will leave a deep hole in the pool of resources available to take care of people.”

The highest-profile business leaders in Milwaukee, including Michael Cudahy, Greg Marcus, Barry Mandel, David Lubar, Jeffrey Jorres, Alex Molinaroli, Gary Grunau, Linda Gorens-Levey and Greg Wesley, signed the letter.

The Milwaukee Business Journal reported that Johnson Controls Inc. is taking a “keen interest” in the Milwaukee streetcar as it considers places for possible expansion. Development giant Jon Hammes said the streetcar could spur construction of an $80-million building he’s proposed for downtown.

But there’s a name that’s missing from that list, and it’s not because he’s reluctant to get involved in the state’s local issues: David Koch. His groups got involved in two school board elections last April in Kenosha, turning them into to pro-voucher boards. They also tried to derail an expansion of that city’s streetcar expansion, Christopher Naumann, executive director of Downtown Kenosha, told WiG.

As in Milwaukee, there were few objections to Kenosha’s streetcar up until the weeks before the vote, despite the fact that it had been a priority for city planners since 2012. Unlike in Milwaukee, Kenosha’s aldermen stood up to the special interests and refused to play politics with their streetcar. They voted to move forward.

Kenosha’s streetcar development will cost $10 million — $8 million of which is coming from a federal grant.

“The momentum this thing took in the last weeks and the personalities that got involved were very interesting,” Naumann said. “Things seemed to be more about politics than about the streetcar.”

“The streetcar isn’t nearly as impactful as other issues, but they were going after this as low-hanging fruit,” he added. 

In the scale of things, a $2-million expenditure on building a streetcar line in a small Wisconsin city seems small potatoes for the mighty Kochs. But it’s an issue for which Koch and his fossil-fuel cronies have a distinct distaste. Any advancement of transportation that replaces driving is bad for their business.

In fact, the involvement of Koch interests in fighting streetcars seems to counter opponents’ claims that they’re underutilized. If the tea party and its fossil-fuel backers really thought no one would use the streetcars, then why would they waste so much effort trying to prevent them from being constructed?

Local opposition

Nevertheless, two 2016 challengers to Milwaukee Mayor Tom Barrett’s re-election have joined forces with Koch brothers allies to turn the streetcar project into the hot-button political issue du jour. After several delays on voting for the project, the Milwaukee Common Council approved it on Jan. 21. But in a convoluted parliamentary move, aldermen also voted to delay its final approval until Feb. 10.

The delay is designed to give Ald. Bob Donovan and Ald. Joe Davis, both of whom want to unseat Barrett in 2016, a chance to collect 31,000 signatures to compel a binding referendum that would mandate voter approval for any rail spending over $20 million. A similar attempt to halt a streetcar in Kansas City failed.

But Citizens for Responsible Government, the ad hoc group led by Donovan that’s spearheading the referendum effort, has said it will not provide the needed signatures until Feb. 9. Milwaukee City Clerk Jim Owczarski said that he’s entitled to — and needs — up to 15 days to review the petitions for accuracy.

So, even though the Common Council has approved the streetcar, it’s unclear what its members will do on Feb. 10. The fate of the streetcar remains up in the air, and the project could ultimately wind up on a court docket.

One possibility is that the referendum would apply to future rail decisions but not this one, Owczarski said.

“You can’t use direct legislation to undo something that’s already been done,” he explained.

Meanwhile Americans for Prosperity, a Koch-brothers-advocacy group, is reportedly trying to steer the city away from the project. Their efforts are benefiting from the support of right-wing radio hosts such as Charlie Sykes, who’s provided a soap box for Donovan (who has formerly run for political office as a Republican).

Why are the Koch brothers and their interests so terrified of a 2.1-mile streetcar system that they would resort to denigrating the program as catering to the rich and would feign concern over public funding for the poor?

‘Ugly wires’

The rhetoric against Milwaukee’s modest streetcar starter plan has been all but apocalyptic. The plan, which would connect downtown Milwaukee to the lower East Side and the lakefront, has been blasted as everything from a racist plot to a rape magnet to a careless waste of taxpayer dollars. (The longterm plan for the streetcar would extend it up the east side of the city and west of the Milwaukee River.)

The introductory price for a ticket would be $1.

Steve Hiniker, president of 1,000 Friends of Wisconsin, and former Milwaukee Mayor John Norquist are infuriated that right-wing leaders have positioned the streetcar as “waste of taxpayer dollars,” while ignoring the $1-billion plan to expand I-94 through downtown Milwaukee. Traffic studies have proven the expansion is not needed, and it would be financed partially through Wisconsinites’ property taxes and federal money that Republican leaders usually make a great show of turning down. It will cause countless accidents, delays and loss of productivity but will offer no necessary benefits at a time when traffic on the corridor is declining.

The difference between the I-94 expansion and the streetcar is that road builders give millions of dollars to elected officials, but the streetcar does not offer them a comparable payday, according to Hiniker and others. 

It’s telling that Donovan wasn’t even aware of the I-94 expansion project when WiG spoke with him recently by phone.

“I haven’t looked at that issue, quite frankly,” said Donovan, who announced his mayoral candidacy for 2016 on Sykes’ radio program.

On the other hand, Donovan and Davis have looked very, very hard at the $124-million Milwaukee streetcar line. They’ve bashed the project with distortions and outright lies. 

Donovan’s complaints about the project are among the quirkiest. He said they represent “old-fashioned technology that’s going to take Milwaukee backwards.”

“It’s going to put ugly wires out in the streets,” lamented the alderman.

But the prize for most bizarre objection goes to Ald. Joe Dudzik, who called in to a live radio program to warn listeners that the streetcar would be a magnet for shootings, assaults and rape. 


The geography and sociology of the United States during the second half of the 19th century were transformed by the construction of vast interstate highway system   made possible by cheap oil and environmental blindness — and racism. From coast to coast and border to border, nature was resurfaced with thousands of miles of tar offering safe passage to white urbanites fleeing black and Latino newcomers.

The white-flight generation littered the nation with ugly, chain-store-studded strip malls and cookie-cutter housing developments that crowded out the plant and animal life that occupied the continent for eons. The one-two punch of chopping down the nation’s trees and filling the air with automobile exhaust helped change the global climate.

But in time, everything old becomes new again. Unpredictable gas prices, the lost productivity resulting from ever-longer drive times to ever-farther suburbs, falling real estate prices and the sociocultural sterility of the suburbs have grown tiresome to growing numbers of their residents.

Farsighted developers revitalized cities like Milwaukee, and empty nesters began opting to live in the vibrant new urban pockets they created, such as the Third Ward, which offers close proximity to entertainment, culture, chic boutiques and gourmet dining.

Their kids, meanwhile, began gravitating to their own urban neighborhoods such as Bay View and Walker’s Point, places that offer low-cost housing, diverse social interaction and freedom from wasting so much of their lives in automobiles, inhaling toxic fumes and contributing to the planet’s demise.

“People want to be close together for social and culture and business interactions,” Norquist told WiG by phone. “The city is a cultural creative soup that creates value. Even the great conservative think tanks are in cities. Being in the middle is important. The urban environment and transit brings people together.”

Norquist, who said the streetcar is a no-brainer for Milwaukee, has witnessed up-close and personal the decades-long struggle to bring rail back to Milwaukee. He notes that automotive interests eliminated the city’s streetcars in the first place.

According to Norquist, business interests connected with Firestone and General Motors owned Milwaukee streetcar systems for a while before eliminating them and the competition they represented.

“A lot of the people who participated in this were progressive,” Norquist said. “They thought streetcars were old-fashioned.”

Norquist said the final owner of a rail system that offered direct service from downtown Milwaukee to the Chicago Loop every hour not only ended the service but “burned down all the trains and equipment because they didn’t want the cars to go anywhere else.”

The federal grant that would cover nearly half of the proposed Milwaukee streetcar project has a long and checkered history, Norquist said. 

Back in the 1970s, the federal government appropriated $500 million for transportation in Milwaukee, Norquist said. The money was frittered away by a succession of governors until there was only $125 million left, part of which was used to tear down the Park East Freeway, he said.

“By the time I left there was $95 million left,” Norquist added. That amount is now down to $54 million.

No one seems to know what will happen to the money if it’s not used for the streetcar. Like the millions that Republicans turned down to build a high-speed rail corridor and expand Medicaid in Wisconsin, it might just go to another city and state with leaders who are more interested in their citizens than their political careers.

Justice gap: three-fourths of low-income civil litigants unrepresented

For every 6,415 people in the United States who qualify for legal aid, there is one legal aid attorney. That means that about about three-quarters of low-income civil litigants in the United States are unrepresented, creating what some call a “justice gap.”

A two-year, $300,000 grant by the National Science Foundation is providing Wisconsin researchers with the opportunity to explore questions about the legal profession and justice for low-income, unrepresented civil litigants.

The study, undertaken by Tonya Brito, professor of law at the University of Wisconsin-Madison, and David Pate, associate professor in the Helen Bader School of Social Welfare at the University of Wisconsin-Milwaukee, both of whom are affiliates of the Institute for Research on Poverty, is in the third and final stage of an ongoing research project.

The study, according to the researchers, is especially timely as the recent recession hit indigent people hard, multiplying the civil problems they tend to face, such as home foreclosures, evictions, social security disputes and nonpayment of child support. The investigators focus on nonpayment of child support and their new study is informed in part by decades of research on child support conducted by IRP researchers. 

Civil incarceration is commonly used as a remedy to enforce child support orders against indigent noncustodial parents, many of whom lack attorney representation. 

“During focus groups in the earlier stages of the study, child support attorneys confirmed that some low-income noncustodial parents experience a revolving prison door for indigent noncustodial fathers,” Pate said in a news release on the research.

“Child support enforcement proceedings offer an interesting and complex setting for exploring contrasting legal assistance models,” Brito said. “The proceedings are often cyclical; obligors experience multiple enforcement hearings for the same child support debt.” 

Michael Turner of South Carolina, for example, is a low-income father who has been civilly incarcerated on six separate occasions for the same unpaid child support debt. When he was sentenced to 12 months in jail for willful failure to pay child support, Turner appealed, asserting a constitutional right to counsel. 

The Supreme Court, in Turner v. Rogers, held that the Due Process Clause does not require appointed counsel in child support enforcement proceedings. The court held that states must, at a minimum, provide unrepresented litigants with “substitute procedural safeguards” (an array of legal assistance measures falling short of full representation) to ensure that the litigants have meaningful access to the courts. In the court’s view, the safeguards would significantly reduce the risk of erroneous civil incarceration. 

Scholars have criticized the Turner ruling because it lacks an empirical base. Access to justice proponents disagree regarding whether attorney representation is essential or whether more limited legal assistance interventions that empower self-representation suffice in cases such as that of Michael Turner.

Brito and Pate’s NSF study will help inform these questions.

“This project exemplifies the real-world application of the work of Institute for Research on Poverty researchers and faculty affiliates here at the UW and across the country,” said IRP Director Lawrence Berger. “Professors Brito and Pate’s examination of how various legal assistance delivery models shape access to justice for low-income civil litigants will provide the empirical base necessary for creating evidence-based policy and intervention.”

5 tycoons who want to close the wage gap

As the middle class struggles to make gains and President Barack Obama strives to shine a spotlight on the issue of income inequality, an unlikely constituency is looking for ways to close the nation’s growing wealth gap: A handful of top U.S. business tycoons.

These advocates point to notions of fairness and admit to twinges of guilt, but the core concern driving all of them – left, right and libertarian – is a belief that the economy doesn’t function efficiently when the wealth gap is wide. They are proposing solutions that range from pressuring fellow entrepreneurs to pay workers more to simply giving their money back to the government to redistribute.

Since roughly 1980, the wealthy have been prospering while the middle class stagnates or falls behind. Members of the 0.1 percent now make at least $1.7 million a year and grab 10 percent of the national income, while the median annual household income has dropped, landing at $51,017.

The gap is growing wider. Income for the highest-earning 1 percent of Americans soared 31 percent from 2009 through 2012, after adjusting for inflation. For everyone else, it inched up an average of 0.4 percent.

As U.S. society has grown more unequal, rich men and women have set up clubs and foundations to encourage economic parity, and they are actively lobbying for change.

The figure of the fairness-conscious billionaire has a precedent, said Harvard Business School professor Michael Norton. During the Gilded Age, at the end of the 1800s, tycoons took steps to increase equality and help the working class.

“Names like Carnegie, Mellon and Rockefeller – the (Warren) Buffet and (Bill) Gates of their days – grace universities, museums and medical centers in part because the originators of those fortunes gave back,” Norton said. “In the same way that some businesspeople are now taking steps to address climate change due to its effects on costs and revenues … the notion that inequality can be bad not just for ethical reasons, but for financial reasons, is one that is increasingly embraced by businesspeople.”

Here’s a look at some of these opponents of the widening gap between the poor and, well, themselves.


The most visible of the superrich Robin Hoods is investor Warren Buffett, who has persuaded dozens of billionaires to give away large portions of their fortunes. Buffett, 83, is the second-richest American, according to Forbes magazine, with a net worth of $58.5 billion. He heads Berkshire Hathaway Inc., which owns everything from the insurance company GEICO and Dairy Queen to underwear maker Fruit of the Loom.

For years, he has advocated policies to close the wealth gap, saying reforms are necessary for the nation’s continued prosperity. Buffett has famously complained that he pays a lower tax rate than some of his most menial-wage employees. That’s because, like many moguls, much of his income comes from capital gains and dividend payments, which are taxed at a lower rate than ordinary wages. His activism gave rise to Obama’s proposed “Buffet rule,” which would ensure that anyone making more than $1 million per year pay at least the same rate as middle-income taxpayers.

The self-made Omaha, Neb., magnate has also for years targeted unequal wealth accumulation. Buffet advocated for a progressive estate tax before members of Congress, saying in 2007, “Dynastic wealth, the enemy of a meritocracy, is on the rise. Equality of opportunity has been on the decline. A progressive and meaningful estate tax is needed to curb the movement of a democracy toward plutocracy.”

Buffett, who did not immediately respond to questions submitted via his assistant, has played a key role in encouraging his peers to redistribute their wealth by choice. In 2010, he launched the Giving Pledge program in which wealthy entrepreneurs publicly promise to donate at least half of their riches to charity. Adherents including Facebook CEO Mark Zuckerberg, oil tycoon T. Boone Pickens and former New York Mayor Michael Bloomberg.


Not all members of the super-rich taking up the issue of inequality are progressives. Ron Unz, a Silicon Valley millionaire and registered Republican who once ran for California governor, is advocating the highest minimum wage in the country for his home state. Unz rose to fame when he spearheaded a 1998 ballot proposal that dismantled California’s bilingual education system. He later became publisher of The American Conservative, a libertarian-leaning magazine.

Lately, he has become obsessed with the idea that a wage hike is the best way to advance the conservative ideal of reducing dependence on government programs. Frustrated with the gridlock in Congress, Unz is pouring his own money into a November ballot measure that would increase the minimum wage in California to $12 an hour in 2016.

At that level, he said in an interview with The Associated Press, “every full-time worker would be earning almost exactly $25,000 and every full-time worker couple $50,000. Under normal family circumstances, those income levels are sufficiently above the poverty threshold that households would lose their eligibility for a substantial fraction of the various social welfare payments they currently receive, including earned-income tax credit checks, food stamps and housing subsidies.”

Unz, whose fortune comes from founding Wall Street Analytics Inc., argues that by not paying a living wage, companies are forcing the government to subsidize them through massive welfare spending. An advocate for the free market, Unz opposes any kind of subsidy. The wage proposal has led him to work with strange bedfellows, including Ralph Nader, the consumer advocate and former independent presidential candidate, and progressive economist James Galbraith.

Unz, 52, trained as a theoretical physicist, has an IQ of 214 and has written scholarly papers on the Spartan naval empire. His political rivals and allies alike have made much of his nerdy demeanor. But his unorthodox background seems to have given him the confidence to go against the conventional wisdom of his party.

“The thing that’s really shocking is that the Republican response to the problem is to call for increased welfare spending. From a free-market perspective, businesses should compete without subsidies,” Unz said. “If they can’t compete, then maybe they should go out of business.”


Seattle venture capitalist Nick Hanauer believes the growing wealth gap threatens the economic system that has given him his wealth. One of the early investors in Amazon, Hanauer started the Internet company aQuantive Inc., which was acquired by Microsoft Corp. in 2007 for $6.4 billion.

But Hanauer said he doesn’t consider himself a “job creator.” If no one can afford to buy what he’s selling, the jobs his companies create will evaporate, he reasons. In his view, what the nation needs is more money in the hands of regular consumers.

“A higher minimum wage is a very simple and elegant solution to the death spiral of falling demand that is the signature feature of our economy,” he said in an interview with the AP last summer.

Hanauer, 54, advocates raising taxes for the rich and hiking the minimum wage to the unheard-of heights of $15 an hour. He has co-authored a book and launched an organization called The True Patriot Network to help push such proposals. In 2012, he advanced his ideas in a TED talk – one of the wonky, provocative lectures that have become a required feather in the cap of web-savvy thought leaders. But TED organizers refused to post Hanauer’s lecture on the web, because they said it was too partisan.


Steve Silberstein made his fortune in the early days of computers by co-founding Innovative Interfaces, a software company that creates technology for hundreds of college and university libraries. He sold the company, settled in a secluded town in Marin County, Calif., and became a philanthropist.

Now, at 70, he is a low-profile member of a movement to organize institutional investors in opposing what he and others say are exorbitant executive salaries.

Silberstein advocates a policy that would tie corporate tax rates to the difference in compensation between the CEO and an average worker. A company with a CEO-to-worker-compensation ratio at the 1980 level of 50-to-1 would pay tax at the current rate of 35 percent; companies with a larger pay gap would be taxed at a higher level, and those with a narrower gap would pay a lower rate.

Silberstein took a step into the spotlight when he produced the documentary “Inequality for All,” featuring former U.S. Labor Secretary Robert Reich. It premiered last year at the Sundance Film Festival.

“He’s one of the quiet leaders of the entire movement toward wider prosperity,” Reich said. “An increasing number of wealthy businesspeople are becoming concerned that the economy can’t function without a strong middle class to keep it going.”

Silberstein told the AP his views are not so different from that original American industrialist, Henry Ford, who famously paid his factory workers enough to purchase one of the cars that came off his assembly line.

“As a result he became rich,” Silberstein said. “If the economy goes well, everybody does well, including the wealthy.”

Like many left-leaning executives troubled by the wealth gap, Silberstein insists that his ideological views play only a small part in his concerns.

“It’s a problem, and everybody is losing as a result. It’s self-interest and the interest in my country, too,” he said.


Leo Hindery Jr., the New York City media and investing mogul, is one of hundreds of wealthy people directly asking Congress to raise their taxes as a member of Patriotic Millionaires. The group was formed in 2010 to advocate for the end of Bush-era tax cuts for people making more than $1 million a year. Hindery is also a member of Smart Capitalists for American Prosperity, and he was among a group of entrepreneurs who went door-to-door in the halls of Congress in early February asking for a higher minimum wage.

A managing partner of the media industry private equity fund InterMedia Partners, Hindery was previously chief executive of AT&T Broadband and of the YES Network, the cable channel of the Yankees. He says he’s turned down raises to ensure that he never makes more than 20 times the salary of his employees. He is also one of the biggest Democratic fundraisers in the nation.

The 66-year-old argues that giving rich people tax breaks makes no economic sense because people like him don’t put their extra dollars back into the economy.

“Do you think I don’t own every piece of clothing, every automobile? I already have it. You spend money. Rich people just get richer,” he told the AP.

Hindery credits his Jesuit upbringing with giving him the tools to look beyond his own economic advantages.

“How can we believe in the American dream when 10 percent of the people have half the nation’s income? It’s immoral, I think it’s unethical, but I also think that it’s bad economics,” Hindery said. “The only people who can take exception to this argument are people who want to get super rich and don’t care what happens to the nation as a whole.”

Study: Gulf between richest 1 percent and rest of America widest since Roaring ’20s

The gulf between the richest 1 percent and the rest of America is the widest it’s been since the Roaring ’20s.

The very wealthiest Americans earned more than 19 percent of the country’s household income last year – their biggest share since 1928, the year before the stock market crash. And the top 10 percent captured a record 48.2 percent of total earnings last year.

U.S. income inequality has been growing for almost three decades. And it grew again last year, according to an analysis of Internal Revenue Service figures dating to 1913 by economists at the University of California, Berkeley, the Paris School of Economics and Oxford University.

One of them, Berkeley’s Emmanuel Saez, said the incomes of the richest Americans surged last year in part because they cashed in stock holdings to avoid higher capital gains taxes that took effect in January.

In 2012, the incomes of the top 1 percent rose nearly 20 percent compared with a 1 percent increase for the remaining 99 percent.

The richest Americans were hit hard by the financial crisis. Their incomes fell more than 36 percent in the Great Recession of 2007-09 as stock prices plummeted. Incomes for the bottom 99 percent fell just 11.6 percent, according to the analysis.

But since the recession officially ended in June 2009, the top 1 percent have enjoyed the benefits of rising corporate profits and stock prices: 95 percent of the income gains reported since 2009 have gone to the top 1 percent.

That compares with a 45 percent share for the top 1 percent in the economic expansion of the 1990s and a 65 percent share from the expansion that followed the 2001 recession.

The top 1 percent of American households had pretax income above $394,000 last year. The top 10 percent had income exceeding $114,000.

The income figures include wages, pension payments, dividends and capital gains from the sale of stocks and other assets. They do not include so-called transfer payments from government programs such as unemployment benefits and Social Security.

The gap between rich and poor narrowed after World War II as unions negotiated better pay and benefits and as the government enacted a minimum wage and other policies to help the poor and middle class.

The top 1 percent’s share of income bottomed out at 7.7 percent in 1973 and has risen steadily since the early 1980s, according to the analysis.

Economists point to several reasons for widening income inequality. In some industries, U.S. workers now compete with low-wage labor in China and other developing countries. Clerical and call-center jobs have been outsourced to countries such as India and the Philippines.

Increasingly, technology is replacing workers in performing routine tasks. And union power has dwindled. The percentage of American workers represented by unions has dropped from 23.3 percent in 1983 to 12.5 percent last year, according to the Labor Department.

The changes have reduced costs for many employers. That is one reason corporate profits hit a record this year as a share of U.S. economic output, even though economic growth is sluggish and unemployment remains at a high 7.2 percent.

America’s top earners tend to be highly paid executives or entrepreneurs – the “working rich” – instead of elites who enjoy lives of leisure on inherited wealth, Saez wrote in a report that accompanied the new analysis.

Still, he added: “We need to decide as a society whether this increase in income inequality is efficient and acceptable.”

Some fans say Burning Man ticket price burns

Tickets for the Burning Man festival in northern Nevada will soon go on sale, and some veteran participants complain the new prices are too steep.

Organizers of the eclectic art and music festival announced that an allotment of 51,000 individual tickets will be available for $380 each. 

Tickets opened at $240 last year, with prices steadily rising as the event approached, the Reno Gazette-Journal reported.

Of the 58,000 total tickets available this year, 4,000 will be available for $190 to those who qualify for the low-income ticket plan. Another 3,000 tickets have already been sold as part of a holiday promotion.

Organizers scrapped last year’s contentious ticket lottery system and now will offer tickets on a first-come, first-served basis.

Christina Allen, who has attended the festival nine times since 2001, said she paid $125 for her first ticket. She said the new $380 price is out of her range, and she’ll apply for a low-income ticket or wait to see if she can purchase a ticket from a friend for a lower price this summer.  

The festival is held the week leading up to Labor Day on the Black Rock Desert, about 110 miles north of Reno.

“I paid $360 last year, and I thought that was high, but $380 isn’t that much higher,” Allen told the Gazette-Journal. “But I am at a different point in my life. I would say $380 is a little steep.”

While “Burner” Jen Medrano still plans to attend this year’s festival, she thinks the new ticket price is a “little expensive.”

“It’s kind of a bummer they are a bit expensive since a lot of Burners with a lower budget count on those lower-tiered tickets,” Medrano said. “Most of those people are artists, performers that don’t have a huge income.”

The new $190 price for low-income tickets is up from $160 last year.

According to Burning Man’s website, the festival’s ticket plan is well under the price of similar events, “particularly given the fact that Black Rock City is a fully-functioning metropolis for nearly 60,000 people constructed in the middle of the remote desert.”

Beginning Jan. 30, a total of 10,000 tickets will go on sale at $380 for “critical theme camp, art installation and mutant vehicle crews,” organizers said.

For the same price, another 40,000 individual tickets will go on sale Feb. 13, while another 1,000 “last-chance” tickets will be available the first week of August.