Meeting Recap – Martin Cantor Sep 25 2020

On September 25, economist Dr. Martin Cantor spoke to members of LIMBA (Long Island Metro Business Action) about the future of Long Island’s economy. He said that the COVID-19 pandemic has ravaged the nation’s economy, especially on Long Island, where downtowns were “decimated” by the closures of small businesses in these areas.
With 70% of the nation’s economy being consumer-driven, Dr. Cantor said, fewer people were shopping out of “fear” of the pandemic. When people don’t spend money, retail establishments suffer. Even online sales cannot save them.
Dr. Cantor also noted that a lot of the businesses that closed down did not have enough cash reserves to cover their losses. As a rule of thumb, he recommends to his business clients that they keep at least six months of cash reserves.
According to Dr. Cantor, 152,000 jobs were lost on Long Island due to the pandemic. Most of those jobs were in the restaurant industry. With the fall season coming and limited indoor dining, he said, many restaurants are closing their doors. Another 50,000 jobs were lost in the tourism, hotel and small retail industries, which, Dr. Cantor said, will not be returning to Long Island.
“There are a lot of businesses I see that pay 100% of the rent, 100% of the utilities, yet they are only operating at 25-50%,” Dr. Cantor said.
Airlines have been impacted as well, with 40,000-60,000 jobs lost, said Dr. Cantor. These losses also affect the surrounding communities. Each job loss in that industry equals 1.5 jobs lost in the local economy.
The pandemic has also impacted county governments. Dr. Cantor said that the Nassau and Suffolk County governments have combined deficits of over $1.5 billion. He credited the Nassau Interim Finance Authority (NIFA) for overseeing Nassau’s finances and ensuring that spending would be kept in check. If it weren’t for the COVID-19 pandemic, “Nassau would’ve had a balanced budget,” he said. Suffolk, however, has “made no concerted effort” to rein in spending. County government expenditures should only be used for public health and public safety and not for redundant services provided by the state.
Dr. Cantor talked about plans by elected officials to raise taxes on the top 1% to plug the budget holes, but he said that wouldn’t work because millionaires “can’t pay for everything.” He also opposes “congestion pricing,” which imposes surcharges on fares for taxis and ride-shares for driving into certain parts of New York City. He said that “people can’t afford it.”
New York State leads all other states in the number of residents moving to other parts of the country, according to Dr. Cantor. Most of those who leave the state are the upwardly mobile, including the wealthy and the upper-middle class. Last year, 50,000 Long Islanders left the state. The exodus could be attributed to rising home prices and the lack of houses on the market. Some of these homes that aren’t being sold are occupied by seniors who wouldn’t be able to afford a new house f they were to sell their current one.
With more people working remotely, Dr. Cantor foresees a decline in commercial real estate and construction because of less demand for office space. He also noted that New York City residents are able to work out of their second homes on the East End without having to check into the office.
Dr. Cantor said it would take between six and 12 months for the economy to return to normal. Further, it would take the “bold leadership” of elected officials to lead their localities through the economic morass; doing do would allow these municipalities to be economically sustainable with federal funding by 2021.

Labor Day Essay Sep 2020

Labor Day 2020- Ernie Fazio

As I was typing these words I looked down at my hands pecking away at the keyboard it occurred to me, that these hands are capable of creating wealth. The skills of these hands and the brains of all who work are the source of all of our wealth. The portent of that realization is profound.

It begs major questions about the way that society values our work.
But these days the person on the scaffold , the person operating the drill press, the scribe who is writing the book, the grocery store clerk, and the hospital employee is undervalued and that is a threat to a democratic society. Anyone who works a 40 hour week and has a steady employment should be able to afford a place to live, feed his family, educate his children and take a vacation.

Under the administration of Franklin Roosevelt laws were put on the books to protect the workers. FDR saw the effects of runaway power of the corporations. Then as now, the financial power was in the hands of too few. He was also convinced that the concentration of financial wealth was responsible for “The Great Depression” The theory being that when there is a financial contraction there is no distributed pool of wealth in the hands of the ordinary citizen to keep the economy going.

The Wagner Act was the major legislation that gave legitimacy to the labor movement and it included the National Labor Relations Board (NLRB) It became a powerful tool to right some of the inequities that existed in 1929. That legislation gave rise to the robust economy that emerged for many years after its passage.

Unfortunately, ever since then, and especially since the 1980’s administration after administration has weakened the power of labor. This administration installed an anti-labor lobbyist as Secretary of Labor. As labor grew weaker, income inequality grew more pronounced. The result of having weak labor put us in a situation now that was similar to 1929. Union membership today is lower than it has been in the last 50 years, and the people are poorer.

When the Covid 19 pandemic paralyzed the economy it took no time at all to trash it because the population had so little reserves to fall back on. When a large portion of the citizens have no savings it does not take much to cause economic calamity

The lesson we should have learned is that without the power to negotiate we cannot look forward to equity in the distribution of wealth. Unions provide that avenue. We cannot, and should not rely on government to distribute the benefits of a capitalist society. A minimum wage law is useful, but it is not the answer.

What is the Wagner Act?
The Wagner Act, also known as the National Labor Relations Act of 1935, prohibits employers in the private sector from engaging in unfair labor practices and gives employees the right to establish labor unions, conduct strikes and negotiate benefits, working conditions and compensation. 

Meeting Recap – Sol Wachtler Sep 4 2020

On September 4, former New York State Chief Justice Sol Wachtler was the guest speaker at LIMBA (Long Island Metro Business Action). Mr. Wachtler shared his views on the current judicial system and the political landscape that he believes has compromised the judicial system.

During the Korean War, Mr. Wachtler was stationed as a military officer in Georgia. At that time, all branches of the armed forces were integrated. His first case involved a Black soldier who was arrested for disorderly conduct, destruction of property and resisting arrest. He received a phone call from the local police department asking if they should hold him; Mr. Wachtler said that the MPs will pick him up and return him to the base. (Soldiers who are arrested by local law enforcement are then turned over to the military to stand trial.)

While living in the rural South, Mr. Wachtler said, he witnessed “bigotry beyond comprehension.” He saw how Blacks were not allowed in restaurants and made to use separate facilities from white people. When he spoke to the police officer, Mr. Wachtler said, he used a racial epithet in reference to the soldier. He also said he experienced prejudice firsthand; as a child, he would be beaten up in school because he was Jewish. The evangelical churches in the area also exhibited an animosity towards Catholics.

In talking about how government functions, Mr. Wachtler said he is glad to see a system of checks and balances in place — that is, no branch of government can have power over the other. When he was appointed chief state justice by then-Governor Mario Cuomo, he said the governor could not influence him to make certain decisions. When President Trump nominated Neil Gorsuch and Brett Kavanaugh to the U.S. Supreme Court, once they joined the Court, the president could not force them on rule on a case in a certain way. 

When he ran for Nassau County Executive in 1967, Mr. Wachtler’s campaign hired a pollster to determine what his message should be. This was the time of the “Long Hot Summer,” when race riots broke out throughout the country. The pollster urged Mr. Wachtler to run on a law-and-order platform (similar to what President Trump is doing during his reelection campaign), saying the nation is very divided. He told the pollster that he didn’t want to mention anything about the riots, but rather focus on coming up with solutions to fix the county’s problems.

One of the attendees asked why there are so many unqualified state judges sitting on the bench. Mr. Wachtler said that, in New York State, the judges are elected, not appointed, which he calls “a travesty.” He added that people vote for these judges without knowing who they are or what they stand for. Further, the candidates are appointed by the political parties. Mr. Wachtler said that only “the best and brightest minds” should be worthy of judgeship.