Minimum wage and trust issues

Updated: Thursday, June 5, 2014
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KALAMAZOO, Mich. (NEWSCHANNEL 3) - There were congratulations all around last week when the Michigan Senate, in an astonishing display of speed and bi-partisanship, passed a new minimum wage law.

Under the law, the minimum wage in Michigan will rise from the $7.40 it is now to $9.25 over the next four years.

Tonight in Tom’s Corner, Tom Van Howe says--all the celebrating aside--as the old saying goes, there are two things you really don’t want to see being made: sausage and legislation.

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Excuse me for not joining the victory dance.

Its not so much that I don’t trust lawmakers--and I don’t.

It’s because I know this law is another example of how our lawmakers don’t trust you and me.

Most of you know what happened. But let me briefly explain anyway:

Our people in Washington were talking about a minimum wage hike--but with a million lobbyists saying it was better to keep people in poverty, that effort landed with a thud.

So, in Michigan, a grassroots petition drive began to amend the law to raise the minimum wage to $10.10.

There were some problems with it. Waiters and waitresses were included and that would have been a problem with our system of tipping for service.

But, nonetheless, it largely echoed what 70 percent of us thought anyway: it was time for a wage hike.

The petitions were signed by 320,000 people, and it seemed certain that the question would make it’s way to the November ballot where passage would be virtually assured.

But our Republican lawmakers were bothered by this. Not only would the law enrage some business owners and some wealthy backers, having an issue on the ballot that might rally Democratic voters just can’t be a good idea.

Its messy. Things might get out of hand.

So up jumps Senate Majority Leader Randy Richardville--Republicans have a majority in both houses so it ought not be necessary to point out Richardville is a Republican--with an idea.

No sense in risking anything with another pesky voter-driven effort; let's repeal the minimum wage law and replace it with a new one that falls short of what the voters might approve of. That way the petition, which seeks to amend the wage law, would be irrelevant, null and void, as cold and tasteless as a week old cup of coffee. You can’t amend a law that has been repealed.

And you know how long it took to get all that done? And did I mention that Democrats joined in, to make the repeal and replacement a bipartisan effort?

It took one day. I mean, there had to have been some groundwork that took a few hours, but when push came to shove--one day!

Remarkable what can be accomplished when you don’t trust voters and have to move fast.

Now the petition people are upset and say they may take their case to court...and I hope they do.

We’ll have to wait and see.

Republicans, meantime, are claiming victory. So are Democrats. So is the Governor who signed it into law almost immediately.

And that’s all fine. The only people left out in the cold are the people who pushed the envelope with a petition drive in the first place.

They get part of what they wanted, but their victory is about as exciting as twin beds.

Politicians here, there, and everywhere urge us to trust them. And then spend millions, even billions of dollars to convince us to vote for them.

It can only mean they don’t trust us, left to our own devices, to do the right thing.

In this corner...I’m Tom Van Howe.

Business News

Last Update on September 16, 2014 17:25 GMT

PRODUCER PRICES

WASHINGTON (AP) -- A measure of prices that producers receive for their goods and services was unchanged in August, the latest sign that inflation is in check.

The Labor Department says that wholesale gas prices fell 1.4 percent last month and food costs dropped 0.5 percent. Those declines offset higher prices for transportation and shipping services.

The producer price index rose just 1.8 percent last month from a year earlier. The index measures price changes before they reach the consumer.

CEO OUTLOOK

WASHINGTON (AP) -- Optimism among chief executives at the largest U.S. companies fell in the July-September quarter after reaching a two-year high in the previous quarter.

The Business Roundtable says that its CEO outlook index fell to 86.4 in the third quarter, down from 95.4 in the April-June period.

Fewer CEOs expect to hire in the next six months: Just 34 percent plan to add jobs, down from 43 percent. And only 39 percent plan to boost their capital spending, down from 44 percent.

Nearly three-quarters of the chief executives expect higher sales, the same as in the second quarter.

Randall Stephenson, CEO of AT&T and chairman of the Roundtable, blamed the decline of the index on Congress' failure to extend temporary tax breaks that encourage research and development and investment spending.

UPS-HOLIDAY HIRING

ATLANTA (AP) -- UPS plans to hire up to 95,000 seasonal workers to help with package deliveries during the busy holiday season.

The Atlanta company said Tuesday that the positions will include package sorters, loaders, delivery helpers and drivers.

Since last year's holiday season, UPS has implemented several measures to help prepare for this year's onslaught of deliveries. This includes making improvements to schedule planning, installing temporary mobile sorting and delivery centers and adding thousands of new or leased delivery vehicles, trailers, aircraft and portable loading aids. It's also adding operating days and shifts.

Last year, a last-minute surge in holiday shipments drove up the shipper's costs and hurt its profits.

United Parcel Service Inc. said that the seasonal jobs have long served as an entry point for permanent employment.

GM-SMALL PICKUPS

DETROIT (AP) -- General Motors is adding 750 workers to a Missouri factory in anticipation of high demand for two new small pickup trucks.

GM wants to add a third shift to its plant in Wentzville near St. Louis by the end of March. The factory now employs 2,600 people who make the Chevrolet Colorado and GMC Canyon pickups as well as full-sized vans.

Alan Batey, GM's North America president, says dealers already have ordered 30,000 pickups and 97,000 people have configured and built them on a GM website. Both are signs of strong demand.

GM is building the trucks and plans to start shipping them to dealers soon. Small pickups have declined in popularity, but Batey is confident people will buy the GM models for their hauling ability, gas mileage and price.

CONGRESS-AUTO SAFETY

WASHINGTON (AP) -- A House committee has determined that the government's auto safety agency should have discovered General Motors' faulty ignition switches seven years before the company recalled 2.6 million cars to fix the deadly problem.

The report issued Tuesday by Republicans on the Energy and Commerce Committee raises serious questions about the agency's ability to keep the public safe as cars become more complex.

The report says the National Highway Traffic Safety Administration misunderstood how vehicles worked, lacked accountability and failed to share information.

A Senate panel is scheduled to hold a hearing Tuesday on the issue.

At least 19 people died in crashes caused by the switches in GM small cars. The company acknowledged knowing about the problem for at least a decade, but it didn't recall the cars until February.

INVESTIGATING LENDERS

ALBANY, N.Y. (AP) -- New York regulators have begun investigating short-term, high-interest loans secured by borrowers' homes or other real estate to determine if they violate state laws against predatory lending.

The Department of Financial Services says Tuesday it has issued subpoenas for information from nine companies involved in so-called "hard money lending."

Under the deals, a borrower's ability to repay typically is unexamined and loans may be structured with an expectation of foreclosing on property.

Superintendent Ben Lawsky says such "loan to own" schemes are unconscionable.

Regulators are investigating whether the companies intentionally set onerous terms with high interest rates, large upfront fees and big balloon payments.

They are also examining complaints some borrowers are required to sign deeds when obtaining loans, permitting lenders to take property when one payment is missed.

GAS DRILLING-WATER CONTAMINATION

PITTSBURGH (AP) -- The final report from a landmark federal study on hydraulic fracturing, or fracking, has found no evidence that chemicals or brine water from the gas drilling process moved upward to contaminate drinking water at one site in western Pennsylvania.

The Department of Energy report was released Monday. It marks the first time an energy company allowed independent monitoring of a drilling site during the fracking process and for 18 months afterward.

Resarchers found that the chemical-laced fluids used to free gas stayed about 5,000 feet below drinking water supplies.

A separate study published this week by different researchers examined drilling sites in Pennsylvania and Texas using other methods. It found that faulty well construction can cause pollution, but not fracking itself.

The Energy Department study monitored six wells at one site. Other drilling locations could behave differently.

COMMERCIAL SPACE-CREW

CAPE CANAVERAL, Fla. (AP) -- NASA is a giant step closer to launching Americans again from U.S. soil.

On Tuesday, NASA will announce which one or two private companies wins the right to transport astronauts to the International Space Station. The deal will end NASA's expensive reliance on Russian crew transport.

NASA officials will make the long-awaited announcement at Kennedy Space Center, next door to where the launches should occur in a few years.

The contenders include SpaceX of California, already delivering space station cargo; Sierra Nevada Corp., which is developing a mini-shuttle in Colorado; and Boeing, which would assemble its crew capsules at Kennedy.

NASA astronauts have been riding Russian rockets ever since the shuttles retired in 2011. The latest pricetag is $71 million per seat.

SELF-DRIVING CARS

LOS ANGELES (AP) -- For the first time, California's Department of Motor Vehicles knows how many self-driving cars are traveling public roads.

The agency is issuing permits Tuesday that let three companies test 29 vehicles on highways and in neighborhoods -- with a human "safety driver" behind the wheel, in case the onboard computers make a bad decision.

With 25 vehicles, Google's souped-up Lexus SUVs are the biggest fleet. Mercedes and VW have two vehicles each.

Self-driving cars already have gone hundreds of thousands of miles in California.

They did because there was no law saying they couldn't.

The Legislature eventually decided to regulate the emerging technology, which navigates using sophisticated sensors and detailed maps.

Over the past year, the DMV wrote testing rules that require driver training and the reporting of incidents.

TOBACCO COUNTRY

DANVILLE, Va. (AP) -- Starting next month, America's remaining tobacco growers will be totally exposed to the laws of supply and demand.

The very last buyout checks go out in October to about 425,000 tobacco farmers and landowners. They're the last holdovers from a price-support and quota system that had guaranteed minimum prices for most of the 20th century, sustaining a way of life that began 400 years ago in Virginia.

Cigarette makers will have paid $10 billion to compensate growers for surrendering their quotas. Growers got another $5 billion from the companies as part of their 1998 settlement of state lawsuits over smoking-related health care costs.

When the last checks are cashed, surviving growers will be on their own, forced to find profits in a tremendously competitive global market.

CAPTAIN CITRUS

TAMPA, Fla. (AP) -- Captain Citrus, the mascot of the Florida Department of Citrus, is getting a makeover.

Captain Citrus was born in 2011 as a big, fat talking orange wearing a green cape. Now he's being transformed into a buff Marvel Comics superhero who will fight evil alongside the likes of Captain America.

The citrus agency paid $1 million to Marvel Comics to create the new character in hopes of bolstering orange juice's reputation as a healthy and wholesome drink. It comes as Americans are drinking less juice and the industry is being threatened by an incurable bacterial disease called citrus greening.

The new and muscular Captain Citrus will appear with Marvel's popular Avengers characters in a series of custom comic books, some of which will be distributed to kids in schools.

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