For a change, wage gains accompany job gains

Despite the uptick in jobs over the last couple of years, one key respect in which the economic recovery is weak has been its failure to raise workers' wages. This week's January jobs report from the Labor Department is more encouraging on that front, reports the NYT:

Last month, average hourly earnings rose by 0.5 percent, leaving wages up 2.5 percent over the last 12 months. That was the best showing since January 2015 and suggested some of the benefits from the falling unemployment rate were beginning to flow to ordinary workers.

Read the Times story here.

New bill would strictly limit forced arbitration

Senator Patrick Leahy (VT) and Senator Al Franken (MN) introduced a bill Thursday that would strictly limit the companies' ability to impose arbitration clauses on consumers and workers. The Restoring Statutory Rights Act would prevent civil rights cases, employment disputes and other crucial lawsuits from being forced into arbitration.

A New York Times article on the bill is here.

Public Citizen's statement about the bill is here.

Food industry lobbies Congress to block Vermont GMO-labeling law

The Washington Post reports today that the food industry is pressuring Congress to block vermont' GMO-labeling law before it goes into effect in July. "The food industry wants Congress to pre-empt Vermont’s law and bar mandatory labeling of genetically modified foods before it goes into effect. They argue that GMOs, or genetically modified organisms, are safe and a patchwork of state laws isn’t practical. Labeling advocates have been fighting state-by-state to enact the labeling, with the eventual goal of a national standard."

The full article is here.

Two more airbag recalls

The Washington Post reports on two new airbag recalls:

Automakers to recall 5M vehicles for another air bag problem

Another problem has developed with automotive air bags, this one resulting in recalls of up to 5 million vehicles worldwide. Continental Automotive Systems says in documents filed with the U.S. government that moisture can get inside its air bag control computers, causing the power supplies to corrode and fail. If that happens, air bags may not inflate in a crash or they could deploy without a crash. The documents, posted Thursday by the National Highway Traffic Safety Administration, say Continental will notify automakers, who will recall cars dating as far back as 2006. Already Honda, Fiat Chrysler and Mercedes have issued recalls. Honda reported two injuries from the problem.

Honda to recall 2.2M vehicles for Takata air bag trouble

Honda is recalling an additional 2.2 million Honda and Acura vehicles because the driver’s air bag inflators made by Takata can explode and hurl shrapnel into the passenger compartment. The recall is a big chunk of the 5 million additional vehicles to be repaired for Takata inflator problems that U.S. safety regulators announced last month. Honda’s recall includes older model years dating to 2005, but also has some newer vehicles from as recently as the 2015 and 2016 model years. The recall brings to about 24 million the number of vehicles recalled in the U.S. due to Takata inflator problems that have caused at least 11 deaths and 139 injuries worldwide.

 

Public Citizen's Amit Narang lays out the dangers of regulatory "reform"

... in The Hill, responding to former head of OIRA Cass Sunstein:

Delays in new public protections have real consequences. Oil trains around the country continue to explode while new safety measures languish in development. Tainted food outbreaks continue to sicken and kill Americans while rules stemming from the new food safety law have missed deadline after deadline. Toxic spills poison our air and water as hazardous chemicals go unregulated for decades. The list goes on and on.

The regulatory paralysis and delays are reaching near-crisis proportions. A recent study, authored by a conservative think tank no less, found that federal agencies missed nearly half of their statutory deadlines over the past two decades. These missed regulatory deadlines violate the law, and if Sunstein's proposals were implemented, we'd see even more of them.

Read Amit's whole piece here.

Sens. Blumenthal and Markey: broaden Takata recall

We've chronicled the saga of Takata's life-threatening airbags and the resulting government recall.

In the latest chapter, Senators Blumenthal and Markey (of Connecticut and Massachusetts, respectively) have written the Obama Administration calling for the recall to be broadened after a horrific death in December:

The [Senators'] letter follows the death of Joel Knight, who was killed in December when the airbag in his 2006 Ford Ranger ruptured after hitting a stray cow in South Carolina, sending metal debris into his throat. The airbag, on the driver’s side, had not been recalled until last month. Ten deaths and more than 100 injuries have been linked to the defect.

Millions of defective airbags are potentially still on the roads, the New York Times reports.

The truth and fiction of climate-change claims

Factcheck.org has put together a video to separate truth from fiction in the climate-change debate. To view it, click here or on the embedded video below. Go here to read the organization's full review. You will hear that some of the "facts" denying climate change from politicians, such as Rep. Lamar Smith and Sen. Ted Cruz, are misleading at best. And you'll also learn that Sen. Harry Reid's claim that black bears in the American West no longer hibernate cannot be substantiated at all. 

 

L.A. Times op-ed raises question about U.C. system's investments and a payday lender

How carefully should public institutions monitor their investment portfolios? Is a payday lender as bad a cigarette company?

These are some of the questions raised by this L.A. Times op-ed about the fact that the University of California's investment portfolio includes the large payday lender ACE Cash Express. U.C. has engaged in socially conscious investing and accordingly has divested itself of coal and tobacco. David Lazarus wants to know why, then, payday lending is OK.

It's a good point. As Lazarus puts it, "The University of California makes money when American workers become trapped in endless cycles of high-interest debt." I might quibble, though, with the article's headline, which makes it sound as if U.C. is putting money directly into ACE: "Why is the UC system investing in a payday lender accused of trapping people in perpetual debt?" the headline. What makes this a somewhat harder question than that is that is does not appear as if UC has consciously chosen to invest in ACE; rather, it is invested in a fund that invests in dozens of businesses. Further, according to a spokesperson quoted in the article, UC is pushing the fund manager to sell off ACE -- which sounds like a good first step.

How far we can expect our institutions to go in avoiding investing in companies that harm consumers is a tough question of line-drawing. There are a lot of businesses that behave in an unsavory manner or participate in an unsavory industry. Many credit cards and banks wallop consumers with high interest rates and impose arbitration clauses. Pharmaceutical companies jack up prices of lifesaving drugs. Oil companies contribute to climate change generally and sometimes more immediate horrors. There are plenty of businesses that we call out on this blog for engaging in shady practices, including deceptions big and small.

Still, the fact that we can't expect everything doesn't mean we should expect nothing. This is an important discussion to have.

Bloomberg Story on CFPB's Arbitration Rule-Making

Here (behind paywall, unfortunately).  Excerpt:

When the CFPB may [issue its arbitration rule] is unknown. A spokesman told Bloomberg BNA that the bureau continues to gather information from stakeholders on the arbitration rulemaking. A final regulation is unlikely to take effect before late 2017 or 2018, Joe Olson, a partner and class action defense specialist with Michael Best & Friedrich LLP, told Bloomberg BNA. The 2010 Dodd Frank Act calls for a 180 day interim from final action on an arbitration rule to its effective date.

 

 

CFPB seeks to improve checking-account access

The Consumer Financial Protection Bureau announced today:

[CFPB] is taking steps to improve checking account access amidst Bureau concerns that consumers are being sidelined by the lack of account options and by inaccurate information used to screen potential customers. Today the CFPB sent a letter to the 25 largest retail banks encouraging them to make available and widely market lower-risk deposit accounts that help consumers avoid overdrafting. The CFPB also issued a bulletin warning banks and credit unions that failure to meet accuracy obligations when they report negative account histories to credit reporting companies could result in Bureau action. And finally, the CFPB is providing consumers with resources to help navigate the deposit account system.

The CFPB's press release is here. Remarks of CFPB Director Cordray about this effort are here.