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Pelosi Remarks at the Congressional Progressive Caucus Hearing on Income Inequality

Washington, D.C. – Democratic Leader Nancy Pelosi delivered remarks at a Congressional Progressive Caucus hearing entitled, “Low-Wage Work on the Federal Dime: How Our Tax Dollars Drive Inequality.”  Below are her remarks:

“Thank you very much, Mr. Chairman.  Mr. Chairman, my colleagues, our special guests who are here: Amy and Reverend Hayes, Julianne – where’s Julianne? Julianne? Where is she? – Julianne Malveaux, Vilma Martinez, Antonio Pascual and Melissa Roseboro.  Welcome.  And again, it is my pleasure to join my colleagues on this very important subject.  And I thank you.  I thank you for holding this hearing. 

“This is important to us, as anything that relates to our democracy, because what we are talking about here – Income disparity, inequality in recognizing the value of work – can do more to undermine the middle class and therefore undermine our democracy.  It is absolutely, almost to the point of immoral the attitude that some have toward the workforce and what recognition the contribution of the workforce toward productivity. 

“In the interest of time, I will stick to my notes, because this subject gets me, get all of us, to a place where we can speak all day about it – and others need to be speaking as well.  So, Congressman Grijalva, Congressman Ellison, the distinguished Whip, Mr. Hoyer, our champion for “Make it in America” as well as for federal employees and public employees, as you heard, thank you.  It is an honor to be here with you.

“Congresswoman Schakowsky, Congressman Pocan, Congresswoman Rosa DeLauro has done so, so very much on, Congressman Cicilline, Congresswoman Lee, Congresswoman Eleanor Holmes Norton – thank you all for being here.

“Okay, why I say that nothing less is at stake in this debate than our own democracy is because there are those in our country who have decided they were going to have a departure from recognizing the role of workers and valuing it.  We have consequential choices that we must make.  And we must engage the public to be involved in the enormous challenges for our country, for our economy, for our families, for our democracy. 

“Rosa DeLauro had at her home a very special guest, Hedrick Smith, who wrote a book, “Who Killed the American Dream?”  And if you haven’t read it, everyone should, because it captures the challenge as well as the statements of those who know about this in a very particular way.  In fact, when you read the book, you’ll say, “I could’ve written this book myself – I’ve seen this.”  And in the book he says that in the 1970’s, CEOs made 40 times the average worker. Today, by the same measures, by the same companies, the average CEO makes around 350 times the average worker. 

“Now, in that period of time, in that period of time, before it used to be that there would be worker pay, CEO pay and productivity, and they would all go up sort of like this. Workers – CEOs made a lot more, but they all rose at the same rate.  Now, we have a right angle. Productivity is still going up.  Workers are not getting the reward and CEOs are.  And one of the reason that is, if you go back 40 years ago when it was 40 times, the chairman of the board of Standard Oil of New Jersey, Frank Abrams was his name, he said: “Stakeholder capitalism, that is what we have, the job of management is to maintain an equitable and working balance between the claims of the variously directly affected interest groups… stockholders, employees, customers, and the public at large.”  If you go that route, you have some element of fairness, of a sense of community. 

“Since that time, we have ‘shareholder capitalism,’ which means we are only concerned about the bottom line to the shareholder – not the workers, not the customers, not the community at large.  And so, the CEO gets paid, the more the shareholders – and the shareholders sometimes make more by firing employees.  This flies in the face of what a country in an economy is supposed to be about.  And in a bible for corporate managers in the early 1980s, “In Search of Excellence,” Thomas Peters and Robert Waterman, Jr. wrote: “Only when we look at excellent companies do we see full employment policies in time of recession.  Caring runs in the veins of the managers of these institutions.”  And that is reinforced by the General Manager of, by a General Electric manager at that time, he said: “Managers and employee benefits on the link between corporate success and worker security, corporate success and worker security…maximizing employment security is a prime company goals, the employee who can plan his economic future with reasonable certainty is an employer’s most productive asset.”  What happened to all of that?  What happened to all of that?  What happened to all of that was ‘shareholder capitalism.’

“Some of these same people who make all this money are just the same ones who fight us on raising the minimum wage, and some of the same people who want to undermine the National Labor Relations Board, and these are some of the same people who look, want us to reduce the deficit by cutting investments in education unemployment insurance, food stamps: ‘But, don’t cut, touch my assets; I don’t want to pay any more taxes. But, I want the deficit reduced.’  And these people on food stamps, why are they there?  They are there to subsidize the low wages that you are paying in order to pay all the big money that you are making in your company.  And that is undermining the middle class, the hopes and dreams of the middle class and everyone who aspires to be in it.  People making minimum wage, two family earners in a family of four, qualify for food stamps is not enough money to put food on the table.  And they resent it, want to cut it and do so in the farm bill and don’t want their taxes cut.  It’s just not fair.

“So, again, you think, I’ll go on forever on this, but it is just, it’s just something that is a national challenge that we must address.  People are hurting.  The policy is bad.  We know that.  You have to help us convey this to the general public, because their jobs, their pensions, their children’s education their dreams of homeownership are all affected by this. 

“Now, no less a person than Aristotle – how many thousands of years ago was that? – he said: “It is manifest that the best political community is formed by citizens of the middle class, and that those states are likely to be well-administered are those in which the middle class is large and strong.”  So, the middle class and everybody who wants to be, aspires to be in it, that is the backbone of a democracy – that is at risk with this income disparity.

“And I thank you for holding this to put on the record the challenges that we face.  I just wanted to share some thoughts with you on the subject.  And I want to thank you for the role that you are planning to call the public’s attention to the fact that, that work must be rewarded.  People must be respected.  All of it is – and let’s just close this with one point, when they want to cut education, that is with stiff competition one of their dumbest ideas.   Because, because they want to reduce the deficit, ‘let’s cut education.’  No.  Nothing brings more money to the treasury, to reduce the deficit than investing in education of the American people – whether little babies, early childhood, K-12, college, beyond lifetime learning for our workers.  That is what brings money to the Treasury.  And we have to change this debate about what all of this is about.  But, we cannot continue to tolerate a situation where this continues to just be bigger, a bigger and bigger gap.

“So, for these and other reasons, I thank Mr. Ellison and Mr. Grijalva and the members of the Progressive Caucus for holding this hearing today.  Thank you.  Thank you all very much.”