ongratulations to everyone who worked to move the country and the world towards greater equity in 2022. Herewith are 10 of the most inspiring economic inequality victories of the year.
1. The Union Boom
No question. The union organizing surge has been this year’s top story. Petitions for union representation jumped 53 percent over 2021. What made the surge truly historic? The explosion of activity in workplaces once considered hopeless for unionization.
Warehouse workers shook the foundation of Amazon, prevailing against harsh intimidation tactics to win the first U.S. union election at the e-commerce giant and building campaigns in several other states, most recently in Minnesota.
A survey commissioned by the Institute for Policy Studies found that nearly two-thirds of local residents support the ongoing Black worker-led union drive at an Amazon warehouse in Bessemer, Alabama – a remarkable shift in what’s been historically a fiercely anti-union state.
Now the overpaid CEOs at Amazon and Starbucks need to negotiate fair contracts with these employees. The top execs at both companies grabbed far more than 1,000 times as much as their company’s median worker pay in 2021.
Union power can both raise worker wages – and rein in excessive wealth at the top. In the middle of the 20th century, as our Sam Pizzigati points out, unions helped “flatten grand private plutocratic fortunes.”
2. Taxing the Rich
Remember the heady days of 2021 when the Build Back Better negotiations had a billionaire tax and other bold inequality-busting tax proposals in play, all with strong public support? When Republicans and two Democratic Senators blocked that deal, I thought we’d have to wait until 2024 before seeing any progress on the fair taxation front. But 2022 saw some important victories – at the federal, state, and municipal levels.
In a piece for CNN, Rebekah Entralgo and I run down the tax wins in the Inflation Reduction Act, the Democrats’ $700 billion climate and social spending bill. The law’s biggest revenue-raiser: a 15 percent minimum tax on big corporations that will help curb rampant tax dodging.
The new law will also boost IRS enforcement so the ultra-rich pay what they owe instead of getting away with hiding their wealth through complex accounting tricks. Republicans have over recent years squeezed the agency’s funding to the point where today the IRS actually has fewer expert staff to audit the complex tax returns of the wealthy and big corporations than the agency had in the 1950s.
Fair tax advocates also notched big wins this year through ballot initiatives. In Massachusetts, voters approved an income surtax of 4 percent on annual individual income above $1 million, with revenue going mostly towards public education and transportation. Can we get similar campaigns going in other Democratic trifecta states?
3. Cracking Down on a CEO Pay Scam
As consumers have struggled with rising costs, corporate CEOs have splurged on stock buyback sprees. This legal form of stock manipulation artificially inflates the value of executive stock-based pay – while doing nothing for workers.
Get this: We calculated that Lowe’s could’ve given every one of its 325,000 employees a $40,000 raise with the $13 billion they blew on buybacks in 2021. Instead, the company’s median worker pay fell 7.6 percent to $22,697. The Lowe’s CEO, meanwhile, pocketed $17.9 million.
In 2022, we started to see some blowback against buybacks. The Inflation Reduction Act introduced a 1 percent excise tax on such share repurchases. Biden officials have also started wielding the power of the public purse against this CEO pay inflation scam. The administration is giving a leg up in the awarding of new semiconductor manufacturing subsidies to companies that agree to forego buybacks.
4. Beating Back Manchin’s “Dirty Deal”
Joe Manchin is not used to losing. In the evenly divided Senate, the conservative Democrat has held enormous power. But climate justice activists in 2022 mobilized massive – and so far successful – opposition to the West Virginia coal millionaire’s repeated efforts to ram through a permitting reform that would weaken environmental protections.
My Institute for Policy Studies colleague Basav Sen points to the bill’s fast-track approval of the Mountain Valley Pipeline project as a particularly blatant example of “crony capitalist corruption.” The developers behind that natural gas pipeline, which poses serious threats to communities and the climate, have funneled more than $70,000 into Manchin’s political campaign coffers.
“We can’t predict the final outcome of this fight,” Sen says, “but supporters of Manchin’s dirty deal can rest assured they’ve picked a fight with the wrong people.”
5. Striking a Blow Against Big Pharma Greed
Big Pharma’s not used to losing either. Pfizer alone has 76 lobbyists working to protect the industry’s enormous profits by keeping drug costs high. But the pharma lobby suffered a rare setback in 2022 when Congress included measures in the Inflation Reduction Act that require the makers of 10 high-priced drugs to either negotiate the pricing of those drugs with Medicare or face a new excise tax. The law also requires drug companies to pay rebates to Medicare if they hike prices faster than inflation for drugs used by Medicare beneficiaries.
Bitter about this rare loss on Capitol Hill, Pfizer CEO Albert Bourla labeled the law’s provisions “to single out” his industry as just plain “wrong.” The pharma exec no doubt has a hard time relating to people who’ve had to choose between paying for medicine or putting food on their family’s table. Bourla’s 2021 pay soared above $24 million.
6. Raising Wage Floors
With Republicans blocking a raise in the federal minimum wage for more than a decade now, advocates are fighting this battle through state and local legislation and direct democracy.
In the November election, voters in two states approved ballot initiatives to increase their wage floors – including in deep-red Nebraska, where they greenlighted a $15 minimum.
The federal minimum wage for restaurant servers and other tipped workers has been frozen even longer, stuck at just $2.13 per hour since 1991. But outside the Washington beltway, that’s changing too.
Mid-term voters in the District of Columbia overwhelmingly approved a ballot measure to phase out the city’s subminimum wage for tipped workers. Eight states have approved similar proposals, although a Michigan measure is tied up in the courts.
Andy Shallal, the owner of nine Busboys and Poets restaurants, applauded the outcome of the DC ballot initiative, saying it “will bring us one step closer to being a more equitable society.”
7. Righting a Historic Wrong for Domestic Workers
Through a shameful holdover from slavery, labor laws in most of the United States explicitly exclude domestic workers. These workers, not coincidentally, are almost all women and mostly women of color. Finally, they are winning some long-overdue rights.
In early December, the D.C. Council voted unanimously to adopt a Domestic Workers Bill of Rights that extends crucial protections – like pay and leave rights and health and safety protections – to the capital city’s nearly 10,000 domestic workers. Final approval is expected on December 20.
That approval will leave three cities – D.C., Seattle, and Philadelphia – and 10 states with such protections on the books. And in a sign of progress at the federal level, Congress this year held the first hearing on a national Domestic Workers Bill of Rights.
A National Domestic Workers Alliance survey has revealed that workers in states with Bill of Rights protections have better working conditions than those in other states.
“The more places that are advancing these policies,” advocate Erica Sklar told Inequality.org’s Bella DeVaan, “the more other states can look to them as a model, to know that these protections are achievable and powerful for workers, employers, and allies.”
8. A Progressive Wave in Latin America
Social movements catapulted three presidential candidates with strong inequality-fighting agendas to victory over the past year: Gustavo Petro in Colombia, Luiz Inácio Lula da Silva in Brazil, and Gabriel Boric in Chile.
Petro recently scored a major triumph with the passage of a new law that will increase taxes on corporate profits and on coal and oil windfalls. Most notably, it will introduce a permanent progressive wealth tax. The government estimates this wealth tax will generate $319 million per year from the ultra-rich. In my colleague Omar Ocampo’s analysis, revenue could be far higher if the law’s new anti-evasion mechanisms prove effective.
Lula, the former trade union leader who will start his third stint as Brazil’s president in January, has vowed to scrap rigid spending caps so his government can prioritize fighting poverty and inequality. He’s also committed to raising taxes on the income and wealth of the country’s economic elites.
Former student movement leader Gabriel Boric had a challenging first year as Chile’s president. In September, voters rejected a constitutional reform that would’ve ushered in sweeping democratic, social, and economic changes in one of the world’s most unequal nations. But Boric — at 36, the world’s youngest national leader — has vowed to revive that reform process and advance key legislative priorities, including a wealth tax and increased levies on large mining corporations.
9. Canceling Student Debt
Dare I put this on a list of victories? Hopefully by doing so I won’t be jinxing the outcome of various legal attacks that have kept Biden’s debt cancellation plan in limbo. But this just seems too big to leave out.
Under intense pressure from progressive activists and lawmakers, the president issued an executive order in August to cancel student loan debt up to $10,000 for all individual borrowers who earn under $125,000 annually — and up to $20,000 for Pell grant recipients.
Biden’s plan would “free up a significant portion of people’s paychecks, supercharge our economy, and combat a major source of inequality among hardworking Americans of all ages and backgrounds,” writes my colleague Olivia Alperstein.
Something tells me the student debt justice fight will continue — no matter how the Supreme Court rules.
10. Rejecting the Trickle-Down Myth
The biggest big picture victory? The growing backlash against failed trickle-down economic theories. Tax loopholes for the rich and austerity for the rest of us – that’s the prosperity formula Republicans and too many Democrats have been selling for the past 50 years. Americans just aren’t buying it anymore.
Every Congressional Democrat voted for the 2022 Inflation Reduction Act, a law that will raise close to $500 billion over a decade from big corporations and the rich to address the climate crisis and create thousands of good-paying jobs. This came on top of major public investment bills passed over the past two years that pulled the country out of the pandemic recession and will funnel federal dollars towards public transit, semiconductor manufacturing, broadband, and other key sectors.
Republicans mistakenly believed the tax hikes in the Inflation Reduction Act would help them win a “red wave” in the mid-terms. According to Americans for Tax Fairness, they spent more campaign ad dollars trying to tarnish their Democratic opponents on tax policy than on any other issue. They failed.
American billionaires’ misbehavior – from union-busting and pandemic joyriding in outer space to crypto swindling and Twitter authoritarianism – has dimmed the public’s long-romanticized view of the role of the ultra-rich in our economy.
In the past, reputational problems could be easily glossed over with grand philanthropic gestures. But a poll the Institute for Policy Studies commissioned in 2022 revealed growing skepticism of such gestures. A majority across the political spectrum now favors tighter regulation of charitable contributions to crack down on tax tricks of the wealthy and to make sure funds move quickly to active charities on the ground.
Chuck Collins, head of the Institute’s Charity Reform Initiative, believes more and more Americans are coming around to the view that philanthropy “will never be an adequate substitute for an effective tax system where billionaires pay their fair share and democratically elected governments make decisions about investment priorities, not billionaires.”
As we turn the page on 2022, the United States and the world face daunting challenges. But the surge in worker organizing and the growing rejection of trickle-down myths provide a strong foundation for building the just, equitable, and sustainable economy we need.