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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Charts: Racial Polarization Increasing in Higher Education

| Thu Aug. 1, 2013 2:16 PM EDT

College attendance rates for African-American and Latino students have been increasing steadily in recent years. But here's the bad news that comes along with that: those students are mostly attending non-selective four-year colleges and community colleges, while whites are increasingly attending prestigious colleges and universities, the Washington Post reports.

A study released Wednesday by the Georgetown University Center on Education and the Workforce found that between 1995 and 2009, college enrollment more than doubled for Latinos and jumped 73 percent for African Americans, while only increasing 15 percent for whites. During that period, 80 percent of white college freshman enrolled in the nation's top 468 colleges, while only 13 percent of Latinos and nine percent of African-Americans went to those selective four-year schools. More than two-thirds of African Americans and almost three-quarters of Hispanics went to non-selective schools. Look:

It's not because minority students are less qualified. Thirty percent of African-American and Hispanic students who had an A average in high school attend community colleges, compared with 22 percent of whites, according to the report, which says that unequal educational outcomes for minorities can be attributed to things like family income, and peer expectations, but also to simply not being white.

"The higher-education system is colorblind in theory but in fact operates, at least in part, as a systematic barrier to opportunity for many blacks and Hispanics, many of whom are college-qualified but tracked into overcrowded and under-funded colleges, where they are less likely to develop fully or to graduate," Anthony Carnevale, one of the report's authors, told the Post.

Here's how unequal college paths for whites and non-whites contributes to growing inequality in America, via the Post:

Students at the nation's top 468 colleges are the beneficiaries of much more spending—anywhere from two to five times as much as what is spent on instruction at community colleges or other schools without admissions requirements. And students at top schools are far more likely to graduate than students at other institutions, even when they are equally prepared, according to the report. In addition, graduates of top schools are far more likely than others to go on to graduate school.

The financial implications of those differences are huge: A worker with an advanced degree is expected to earn as much as $2.1 million more in his or her lifetime than a college dropout, the report said. Also, the report said graduates of selective colleges earn an average of $67,000 a year 10 years after graduation, about $18,000 a year more than their counterparts who graduate from non-selective schools.

The report's authors say that in order to combat growing racial polarization in higher education, more resources need to be directed to improve students' academic experiences at non-selective schools, which often struggle with over-crowded classrooms and outdated materials. The authors say that colleges and lawmakers should also do more to bring black and Hispanic students into top schools.

The report comes just as the Supreme Court recently dealt a blow to affirmative action. In June, the high court allowed affirmative action to survive, but made it harder to institute as part of the admissions process, ruling that schools must first prove there are "no workable race-neutral alternatives" to achieve diversity on campus.

JPMorgan Chase Accused of Manipulating Electricity Prices, Pays Record-Breaking Penalties

| Tue Jul. 30, 2013 4:15 PM EDT

Just one day after US regulators formally accused it of manipulating energy prices, America’s largest bank, JPMorgan Chase, has agreed to pay a record $410 million in penalties.

Specifically, the Federal Energy Regulatory Commission (FERC) accused Chase traders in Houston of devising elaborate schemes that essentially forced electricity grid operators—organizations that manage the flow of electricity—in California and the Midwest to pay for plants to sit idle, causing them to pay more than 80 times the cost of prevailing electricity prices for ten months between 2010 and 2011. Chase's alleged price-gouging echoes the infamous 2001 Enron scheme, in which the company constricted electricity supply in California in order to jack up prices.

The FERC action comes at a time of increasing scrutiny of banks' ownership of commodities. Last week, for example, the New York Times questioned whether Goldman Sachs was manipulating the aluminum market through the metal warehouses it controls.

Even though the penalty for Chase's bad behavior is the largest the FERC has ever slapped on a company, the fine still falls in line with trifling punishments leveled against the bank—and other financial behemoths—for similar egregious behavior. Chase’s $410 million settlement, which was reached on Tuesday and will be divided between ratepayers and the Treasury Department, represents less than two percent of Chase’s record $21.3 billion 2012 profits—or about what it earns in a single week. (FERC has also barred the bank from trading in US energy securities for the next six months.)

Investigators for the agency initially considered holding one Chase executive and a few specific traders individually liable for the allegedly abusive pricing schemes, but ultimately dropped that idea, according to the Times. The bank has denied wrongdoing, and, as Reuters has pointed out, the settlement will put an end to a troublesome "distraction" for Chase CEO Jamie Dimon.

The bank has had other distractions in recent years. In May 2012, Chase lost $6 billion on risky trades out of its London office. So far, the banks has escaped penalty for those actions—US banking regulators merely ordered it to fix the risk-management failures that led to the massive loss.

Sen. Elizabeth Warren (D-Mass.) has repeatedly highlighted the discrepancy between the punishments meted out to ordinary Americans for criminal behavior and those big banks receive for wrongdoing—whether it be tricking consumers into paying higher power prices, causing massive trading losses, or laundering drug money: "If you're caught with an ounce of cocaine, you're going to go to jail," she said at a Senate Banking Committee hearing earlier this year, referring to the giant international bank HSBC. "But if you launder nearly a billion dollars for international cartels and violate sanctions you pay a fine and you go home and sleep in your own bed a night."

Fast-Food Workers Strike in 7 Cities to Demand Higher Wages

| Mon Jul. 29, 2013 11:54 AM EDT

In a major address at Knox College in Galesburg, Ill., last week, President Barack Obama launched a push to "deliver on behalf of those people that are still struggling" in this recovering economy. Some of his priorities include investing in green jobs, focusing on education and training, and raising the minimum wage. On Monday, in what will likely be the largest fast-food strike in US history, workers in seven cities are lending him a hand in the effort by walking off the job to demand higher wages.

Thousands of fast-food workers in New York City, Chicago, St. Louis, Detroit, Milwaukee, Kansas City and Flint, Mich., will strike at joints like McDonald's and Wendy's, calling for a wage increase to $15 an hour and the right to join a union without retaliation. (Although all American workers are legally allowed to join unions, many who try to organize are fired or punished with reduced hours.)

Many fast-food workers are paid at, or just above, the minimum wage. The federal minimum wage is $7.25, though it's higher in 18 states and the District of Columbia. Fast-food wages have fallen 36 cents an hour since 2010, even as the industry has raked in record profits.

This is part of an economy-wide problem; the bottom 20 percent of American workers—some 28 million employees—earn less than $9.89 an hour, or $20,570 a year for a full-time employee. Their income fell five percent between 2006 and 2012. Meanwhile, average pay for chief executives at the country's top corporations leaped 16 percent last year, averaging $15.1 million, the New York Times reports.

The Times has a great chart showing what low-wage America looks like. Here are the demographics of the 21 million workers who make between $7.25 and $10 an hour:

The mobilization of fast-food workers is a pretty new thing, because the industry has traditionally had high turnover. But the slow economic recovery, which has been characterized by growth in mostly low-wage service sector jobs, has resulted in a growing population of adult fast-food workers who can't find other work.

Fast-food workers can work in the industry for years without more than a dollar or two raise. In his story on the strikes at Salon Monday, Josh Eidelson points to a recent study by the National Employment Law Project that explains why: "Opportunities for advancement in the fast food industry are significantly limited compared to other industries," the report says. "[O]nly 2.2 percent of jobs in the fast food industry are managerial, professional, or technical occupations, compared with 31 percent of jobs in the overall US economy."

The strikes today follow waves of fast-food worker strikes across the country this past spring and last fall. And they are part of a string of recent strikes in other industries too. In recent weeks, federally-contracted workers in Washington walked off their jobs; and there has been growing worker discontent at Walmart over the past year.

As City University of New York labor expert Ruth Milkman told Eidelson of the Monday strikes, "As a consciousness-raising strategy for the United States, it’s really great."

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