"he said he vetoed this bill because the fund the state uses to pay unemployment benefits will be nearly $20 billion in debt by the end of the year.
The fund the state uses to pay unemployment benefits is already more than $18 billion in debt. That’s because the fund ran out of money and had to borrow from the federal government during the pandemic, when Newsom ordered most businesses to close and caused a massive spike in unemployment. The fund was also beset by massive amounts of fraud that cost the state billions of dollars."
The reasoning and background, if anyone is curious
I want to know more about the fraud. At what level is/was the fraud happening?
Also the “Newsom ordered most businesses to close.” I guess I thought it was a pandemic that had ordered most businesses to close?
PPP was notoriously fraudulent. Big corps we’re taking PPP loans
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I thought the whole point of paying you union dues was that when a strike happens, the union covers a portion of your salary like unemployment.
It’s not an unlimited fund, which is why the UAW strike isn’t at every single plant for example. Policies like this would greatly strengthen unions by allowing much longer and more widespread strikes.
Which is where Newsome’s line is.
Strike pay is only $500 a week plus insurance coverage. It’s hard to live on that when strikes can last 6 months or even a year
What kind of strikes last 6 months to a year???
99% of strikes last much, much less. No manufacturer in the world can last 6 months without workers. No software company can last 6 months without workers. No fast food company lasts 6 months without workers. No train, bus or airplane company lasts 6 months without workers.
Small ones that you don’t hear about. Locals with less than 200 members wind up striking much longer because they’re less threatening. The longest strike in US history was 11 years. Strikes can last longer than you might think. The company just hires scabs. A couple years ago, 200 miners were on strike for 1029 days under the United Steelworkers.
Playing devil’s advocate but what would be the point in working if you got paid similarly by just striking? A worker’s strike is a gamble and always has been. In this instance the workers do not have the upper hand because demand for domestic made vehicles has plummeted and automation is nearly capable of replacing the workers.
Another thing I don’t understand is this isn’t unemployment. This is chosen by the worker and the union and so it’s not unemployment but refusal to work.
The other side of the argument is how can you get away with exploiting your workers if they have the option of striking comfortably?
Never forget history too, people died for this shit only for it to become a reality during this time period.
Ever been to France? Ever heard of the SNCF?
Then what of all those who wouldn’t get unemployment when they’re laid off because a union decided to strike for more favorable conditions.
I had typed out this HUGE rant about how it would hurt Ford’s bottom line severely to give into the UAW strike demands. So I did some research to help my stance. I was wrong. Year over year, for the past 3 years, Ford Motor has shown an increase of at least 9% gross profit. Ford could very easily afford to cut into some of the more than $24 billion dollar gross profit to give into the 40% raise the UAW are requesting. I’d be willing to bet GM and others involved are in nearly the same boat.
Edit: That being said their net profit has taken a steep dive in the last few years so I’d assume there is some cooking of the books going on.
Without looking at the numbers, gross profit is before expenditures, so it’s not like Ford has 24 billion in surplus money.
“I assume that there is some cooking of the books”
Or maybe there is stronger competition and profit margins have fallen?
Their net profits have fallen considerably since 2021 but that can be attributed to the chip shortage. I chose gross profit because you take the 40% increase for the 57,000 hourly ford employees making on average $19/hr and you’d end up reducing their gross profit by $900 million. That’s a large amount of money but in general would only be around 25% of their net profit (going off pre COVID numbers) annually. Those same workers would then be able to afford the vehicles they’re building day in and day out. As it stands $19 an hour is just $39,520 a year which means it’s not likely they can afford a new car that they themselves are building.
Edit: Looks like their heaviest expenditures lately were factory overhauls for redesigned F-150 pickups thus causing their net profit losses.
A number that isn’t taken into account is GM spent $3.4 billion in stock buybacks in the last 12 months. They count this as operating expenses even though it only serves to artificially inflate their share prices so they can pay dividends to shareholders. A truly unnecessary expense that could be used for workers.
I understand that. But a strike isn’t them being forced to stop working by their employer. It isn’t like being laid off. They chose to stop working when the alternative is to work and get paid.
You don’t get employment insurance when you voluntarily quit a job.
If they want a bigger strike pay, they need to either contribute more or join a bigger union that has the financial means to support them thanks to higher number of participants.
Maybe I’m wrong, but I’m pretty sure UAW is the best paying strike pay in the US. It’s also the 6th biggest union. The point is that the company has a much bigger advantage for surviving a strike than workers do. Getting unemployment would help level the playing field.
UAW fucked over the UC graduate students.
That’s true though. It used to be that a general strike would have a big impact on an industry, but with the wealth that the companies have accumulated in past decades, it’s not even enough to strike anymore.
The real answer to this would be a universal basic income for everybody. If you’re either fired, laid off, on strike or voluntarily quit, you should still receive a sufficient form of income.
People sometimes quit for good reasons like toxic environnements or for health reasons or because they need to take care of someone. They shouldn’t be penalized.
What you claim is your position. Some agree. Others don’t.
That’s what Teamsters does. No idea what’s going on here.
The fund ran out of money. What a fucking mess. How can a state simultaneously have the richest companies in the world and not be able to fund basic social support systems?
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But it’s the good state
If only workers paid into the unemployment fund every paycheck, then there’d be no argument for keeping their money from them. Oh, wait… we do.
Unemployment is funded by a tax on employers, not employees.
That’s not how tax incidence works. A tax is applied to the transaction, and its burden depends on who has more bargaining power, not on who writes the check.
It’s called FUTA. Look it up. Also, there’s likely a state equivalent wherever you reside.
I think that the argument is that if an employer can afford to pay a worker $30,000 per year and the unemployment tax is $3,000 per year then the employee gets $27,000 per year. So the employee effectively paid that tax, not the employer, even though the employer is the one who sent the money and the employer is the one who is liable for the money.
They just pass the burden onto the employee. They have to because that’s just how it works. Just like the customers pay for a restaurant’s rent in the form of an increase in prices to cover the cost.
There is no act that changes how tax incidence works.
This is 100% correct. Sadly it’s not as transparent as it should be and quite a lot of corporations have ways of getting around it. Not to mention during COVID there was a lot of taking from the fund but nearly no returning.
No, you don’t, lol. Your employer does.
How is this world news? Doesn’t America have enough news communities?
Murica is the world, duh
I’m rabidly pro-union but I’m OK with this. The union should provide.
Employers should be forced to pay striking workers anyways. Fuck em. Burn the whole system to the ground, it’s exploitative and abusive and it has extracted untold wealth from the working class for centuries.
Thats the third most idiotic thing ive ever heard
Are you a millionaire? If not, why are you defending people who are? They’re actively exploiting you, making big bucks off of your hard work, and you’re calling me an idiot?
“Rabbidly pro-union” and “as left as they come”, no doubt lol.
This is the best summary I could come up with:
Gavin Newsom vetoing a bill Saturday that had been inspired by high-profile work stoppages in Hollywood and the hotel industry.
That’s because the fund ran out of money and had to borrow from the federal government during the pandemic, when Newsom ordered most businesses to close and caused a massive spike in unemployment.
Labor unions had argued that the amount of workers on strike for more than two weeks is so small it would not have had a significant impact on the state’s unemployment trust fund.
Of the 56 strikes in California over the past decade, only two lasted longer than two weeks, according to Democratic state Sen. Anthony Portantino, the author of the bill.
“This veto tips the scales further in favor of corporations and CEOs and punishes workers who exercise their fundamental right to strike,” said Lorena Gonzalez Fletcher, executive secretary-treasurer of the California Labor Federation.
The legislation was an attempt by Democratic state lawmakers to support Southern California hotel workers and Hollywood actors and writers who have been on strike for much of this year.
The original article contains 509 words, the summary contains 178 words. Saved 65%. I’m a bot and I’m open source!
