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Article Artículo

AAPI

Economic Growth

Government

Workers

1 Million #AAPI Workers Would Get a Raise if the #MinimumWage Were $10.10

Since May is Asian American and Pacific Islander (AAPI) Heritage Month, CEPR's looked into Census data about AAPI workers and found some interesting tidbits.

For example, the President and some Congressional leaders would like to see the federal minimum wage go up to $10.10 per hour.  If that were to happen, the data show that just over 1 million AAPI workers would be directly affected (that's 13.7% of AAPI workers).  And economic research shows that a significant number of workers making just above the $10.10 line would also get raises.

CEPR and Nicole Woo / May 21, 2014

Article Artículo

Wall Street

New Book on Private Equity Tackles Myths About the Industry

The private equity industry is often at the center of a debate over whether it saves failing businesses or undermines healthy companies at the expense of creditors, vendors, workers and retirees. This should not be surprising. Since modern private equity got its start with the first leveraged buyout of a publicly traded company in 1979, the industry’s complex organizational structures allowed for little oversight and government regulation. Much of the analyses available on PEs are positive accounts by industry insiders and slightly more modest takes by finance economists, and as a result, it has been difficult to assess the economic impact of this $3.5 trillion dollar industry.

Noting this lack of transparency, the Securities and Exchange Commission (SEC) recently began an investigation of industry practices. Since 2012, SEC staffers have reviewed roughly 400 PE funds and the results are striking. Of the firms reviewed, general partners at 200 firms collected fees and expenses from the companies they managed without disclosing or sharing these fees with investors.

While the SEC examinations focus on the need for greater oversight of the industry, Private Equity at Work: When Wall Street Manages Main Street, by CEPR’s Eileen Appelbaum and Cornell University’s Rosemary Batt offers a broader and more comprehensive examination of the private equity business model and its impact on the U.S. economy and labor market. Their analysis draws on original cases, interviews with PE and pension fund managers, legal documents, bankruptcy proceedings and academic scholarship.

CEPR / May 16, 2014

Article Artículo

A Failure Foretold: USAID’s Plans to Build a Port in Northern Haiti

Last month Jacqueline Charles of the Miami Herald reported that the U.S. government had changed its plan for the development of a new port in support of the Caracol industrial park in Haiti’s north. The Herald report began:

After months of unsuccessfully trying to get private investors to cough up millions of dollars for the construction of a new, multimillion dollar port in northeastern Haiti, the U.S. government is scratching its plans and will instead revamp the existing port in the city of Cap-Haitien.

“The private sector was markedly unenthusiastic about investing in a new port,” said a U.S. government official familiar with the decision, but not authorized to speak publicly.

The new Fort Liberté port would have cost between $185 million and $257 million, and the U.S. government had committed to investing $70 million. A new port was viewed as being critical to the success of the nearby $300 million Caracol Industrial Park because the park’s five companies mostly ship out of ports in the neighboring Dominican Republic, a loss of valuable dollars to the Haitian treasury.

But while the Herald report points to a lack of private sector enthusiasm for the project as a key reason for its failure, an analysis of Government Accountability Office (GAO) reports and contractor documents reveals that this project has been plagued by a lack of in-house expertise and planning from the beginning.

It began in September 2011 when USAID awarded a contract to MWH Americas to conduct a feasibility study for port infrastructure in northern Haiti. MWH had previously been found by the New Orleans inspector general to have overcharged the city on reconstruction contracts related to hurricane Katrina. As HRRW reported in February 2013, “Within two weeks of receiving the $2.8 million contract, MWH Americas turned around and gave out $1.45 million in subcontracts to four different firms, all headquartered in Washington DC or Virginia.” The contract was extended multiple times, with the overall cost increasing to over $4.25 million. Still, the GAO later found that further studies “still need to be performed,” because the USAID “did not require the contractor to obtain all the information necessary to help select a port site,” according to the GAO.

Jake Johnston / May 08, 2014

Article Artículo

Honduras

Latin America and the Caribbean

World

Dinant: We Don’t Forcibly Evict; Government Security Forces Do That

As we’ve described before, there is much controversy surrounding the World Bank’s International Finance Corporation’s investment in palm oil production in the Bajo Aguan, Honduras. Wealthy landowners have been engaged in a violent conflict with campesinos, resulting in the deaths and forced evictions of many campesinos at the hands of security forces both governmental and private. The company at the heart of the investigations and recent media scrutiny is Dinant, owned by the man many consider to be Honduras’ wealthiest and most powerful, Miguel Facussé.

As we have previously noted, Facussé has admitted the killings of some campesinos by his security forces. A 2011 human rights report from the Food First Information and Action Network, the International Federation for Human Rights and other groups details a number of killings, kidnappings, torture, forced evictions, assaults, death threats and other human rights violations that victims, witnesses and others attribute to Facussé’s guards.

Facussé has attempted to clean up his public image before, such as a notable December 2012 interview with the Los Angeles Times in which he made the case that just because he keeps a gun on his desk, and just because he “keeps files of photos of the various Honduran activists who are most vocal against him,” and just because one of his private planes was used to fly the foreign minister out of the country (against her will) during the 2009 coup, and just because he was aware of the coup plans before the coup, he’s really not a “bad guy.” And sure, he admitted he “probably had reasons to kill" attorney Antonio Trejo Cabrera, who worked on behalf of campesino groups in the Aguan, but Facussé said, "I'm not a killer."

Now Dinant has demonstrated a similar PR savviness. Writing in the Guardian after a series of articles examining the IFC/Dinant controversy, Dinant corporate relations director Roger Pineda Pinel noted among other things that “We have never engaged in forced evictions of farmers from our land; such evictions are undertaken exclusively by government security forces acting within the law and under instruction from the courts.”

CEPR / May 08, 2014