Erika Eichelberger

Erika Eichelberger

Reporter

Erika Eichelberger is a reporter in Mother Jones' Washington bureau. She has also written for The NationThe Brooklyn Rail, and TomDispatch. Email her at eeichelberger [at] motherjones [dot] com. 

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Fast-Food Workers Arrested In Fight For $15 Minimum Wage

| Thu Sep. 4, 2014 11:45 AM EDT
Police officers arrest a protester in front of a McDonald's restaurant in New York's Times Square on Thursday.

On Thursday, nearly two years after fast-food employees first walked off the job in New York City, workers in dozens of cities around the country are staging a new round of strikes aimed at winning workers a $15 minimum wage and the right to form a union. This spate of walk-outs will see a significant escalation in tactics: home healthcare workers will join the day of action, and some workers will engage in civil disobedience. Several have already been arrested.

"On Thursday, we are prepared to take arrests to show our commitment to the growing fight for $15," Terrence Wise, a Kansas City Burger King employee and a member of the fast-food workers’ national organizing committee, said in a statement earlier this week.

Employees at restaurant chains including McDonalds, Pizza Hut, and Burger King are walking off the job and staging sit-ins in 150 cities nationwide, from Chicago to Oakland, Pittsburg to Seattle. During the last one-day strike in May, workers protested in 150 US cities and 80 foreign cities, forcing several franchises to close for part of the day.

So far, the massive chains have been resistant to bumping up workers’ wages. Nevertheless, the movement has dealt some serious setbacks to one of the biggest fast-food employers: McDonald's. The company's public image was tarnished significantly between 2013 and 2014, according to a recent study quantifying companies’ reputations. McDonald's sales have fallen over the past year amid ramped up scrutiny from Congress over its poverty wages. And in July, the National Labor Relations Board ruled that McDonald’s corporate can be held liable in worker lawsuits over wage-theft and working conditions. (The company had been arguing that it does not exert significant control over its franchises’ employment practices.)

The Service Employees Industrial Union, which has backed the workers from the start, hopes the addition of some of the nation’s 2 million home healthcare aides to the growing movement will put additional pressure on states and localities to raise their minimum wage.

On Labor Day, President Barack Obama gave the fast-food worker movement a morale boost. "All across the country right now there’s a national movement going on made up of fast-food workers organizing to lift wages so they can provide for their families with pride and dignity," the president said. "There is no denying a simple truth. America deserves a raise."

Here’s Why Bank of America’s $17 Billion Settlement Probably Won’t Cost It That Much

| Thu Aug. 21, 2014 11:59 AM EDT

On Thursday, the Justice Department announced a record $17 billion settlement with Bank of America over accusations that the bank—as well as companies it later bought—intentionally misled investors who purchased financial products backed by toxic subprime mortgages. It's the largest settlement the US government has reached with any company in history, and it is roughly equal to the bank's total profits over the past three years. But as is the case with similar settlements involving Citigroup and JPMorgan Chase, Bank of America probably won't end up paying that much.

Potential tax deductions and tricky accounting techniques in deals like this often hide the real cost to banks. The Associated Press explains:

Bank of America will pay $9.65 billion in cash and provide consumer relief valued at $7 billion…Whether cash payments are structured as penalties or legal settlements can determine whether targeted companies can declare them as tax-deductible business expenses. Also, consumer relief is an amorphous cost category: If Bank of America's deal resembles the department's previous settlements with JPMorgan and Citigroup, that part could be less costly to the company than the huge figures suggest.

...[M]uch of the relief will come from modifying loans that the banks have already concluded could not be recovered in full. Reducing the principal on troubled loans often just brings the amount that borrowers owe in line with what the banks already know the loan to be worth.

Settlement math also affects the actual cost of the deals, allowing banks to earn a multiple for each dollar spent on certain forms of relief. Under Citi's deal, for example, each dollar spent on legal aid counselors is worth $2 in credits, and paper losses on some affordable housing project loans can be credited at as much as four times their actual value.

Banks generally regard the consumer relief portion of settlements as "stuff they're doing anyway," banking analyst Moshe Orenbuch told the AP.

The Bank of America settlement resolves more than two dozen investigations by prosecutors around the country.

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