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February 22nd, 2012
Who really runs Chicago? According to Chicago Magazine, it is a collection of leaders in politics, business, sports and food.
Chicago Mayor Rahm Emanuel
Earlier this month, the magazine came out with its list of the city’s 100 most powerful people. It’s a surprisingly diverse list, with some very familiar and not so familiar faces. (Oprah, whose Chicago-based show ended last year, is no longer on it.)
Steve Edwards at our partner station WBEZ recently talked about the list with Chicago Magazine editors David Bernstein and Marcia Froelke Coburn.
We broke down the Top 10 into four categories.
Politics: In a city where politics is in everyone’s DNA, it’s no surprise that Mayor Rahm Emanuel is the most powerful person in Chicago. He’s joined in the top 10 by three other politicians: U.S. Attorney Patrick Fitzgerald, Illinois House Speaker Mike Madigan, and President Obama’s campaign strategist, David Axelrod.
Business: Even though McDonald’s is one of the biggest companies in the Midwest, and global powerhouse, you might not know its low-keyCEO, Jim Skinner. A much more recognizable name in Chicago is Penny Pritzker, the founder and CEO of Pritzker Realty, and a major philanthropist.
The top 10 list also includes Eric Lefkofsky, a Southfield, Mich., native who is co-founder and chairman of GroupOn (its CEO, Andrew Mason, comes in at No 11).
Sports: In a sports-mad city, it’s no surprise to see two people associated with Chicago’s teams on the list. They are Rocky Wirtz, chairman of the Chicago Blackhawks, and Derrick Rose, the star point guard with the Chicago Bulls.
Food: Chef Grant Achatz, whose restaurant Alinea is considered to be one of the best in America, is the leading chef on the list. He’s another native of Michigan whose family is in the pie business back home.
Read the complete Chicago Magazine list here. Did they leave anybody off that you feel should have been included?
Normally, everyone at GM would be celebrating. The automaker said Thursday that it earned $7.6 billion last year, the most ever, less than three years after receiving a federal bailout and going through bankruptcy protection.
But the 2011 performance masked a disappointing fourth quarter for the Detroit-based auto company. GM’S fourth-quarter profit was flat with 2010. It earned about $500 million, or 28 cents per share before special items.
With those charges accounted for, GM earned 40 cents per share, two cents below what analysts forecast. And the worst headache for GM came in Europe.
It lost more than half a billion dollars during the fourth quarter on its European operations, bringing their loss for the year to more than $700 million. The crisis is escalating: as recently as November, GM was saying it might break even in Europe.
GM has been working on a European restructuring for more than two years. It says its plan “did not go far enough. This is simply unacceptable,” the company said Thursday. GM wants to move “rapidly and decisively” there, and plans to work with European unions and countries in order to bring down its costs.
Due to the difficulties overseas, GM’s net income came primarily in North America. But there is some good news: its hourly workers in the United States will receive profit sharing checks of about $7,000 apiece.
NPR’s Sonari Glinton and I talked about what lies ahead for the auto industry on WBEZ’s Afternoon Shift with Steve Edwards on Tuesday. Listen to that lively conversation.
February 15th, 2012
Although the political spotlight is on Michigan’s Feb. 28 primary right now, there’s another good political story bubbling in the Great Lakes states.
Richard Lugar, who turns 80 in April, has been one of Indiana’s U.S. senators as long as a lot of people have been alive. He was first elected to the Senate in 1977, and he’s served as chairman of the Senate Foreign Relations Committee twice. Before he was elected to the Senate, he was mayor of Indianapolis.
But Lugar, a Republican, may face a stiff challenge from within his own party. The Chicago Tribune reports that the Club for Growth, an influential conservative group, is endorsing Lugar’s primary opponent, Indiana State Treasurer Richard Mourdock.
The Club’s president, Chris Chocola, questioned some of the votes that Lugar has taken on fiscal issues in Washington.
Lugar voted in favor of a Congressional bailout for Detroit automakers, and more recently, the Indiana senator opposed a ban on earmarks that was pushed for by Republicans in the Senate.
Lugar’s internal polling shows him well ahead in the Indiana race, according to the Tribune. But if he were to face a tough challenge, or even lose the Senate race, it could be a blow to President Barack Obama. He has cited Lugar as one of his good friends when he was in the Senate, even though the pair are from different parties.
February 15th, 2012
In many ways, the headquarters for Eastern Floral in Grand Rapids, Mich. is like a factory. It’s in an old building with brick walls. The floor is smooth, cold concrete. A noisy printer rattles off new orders.
But of course, it smells amazing in here. Designers stand at long wooden tables, primping and pruning flowers. Red tulips. White daisies. Yellow roses. And just about any other flower you can imagine.
Bing Goei, the owner, says this work is more like artistry.
“I think you have to be born with that.” he says. “I was not. I admit it.”
Goei says this with a laugh.
But he was born with something else that turned out to be its own asset. He was born with a foreign birth certificate. His parents were Chinese. He was born in Indonesia, then moved to the Netherlands. From there, they moved to Grand Rapids, like a lot of Dutch people before them. Except, they have a Chinese name.
And like many of those immigrants before him, Goei worked hard. He started in the flower business in high school. Now, Eastern Floral has seven locations, about 60 year-round employees – twice that around Valentine’s Day – and the company has over $5 million in annual revenue.
Goei says being an immigrant, and being an entrepreneur, there’s a connection there.
“Almost every immigrant that comes to this country has come because they see America as that land of opportunity,” he says. “So immediately, their drive is to fulfill that dream.”
The data on this backs Goei up.
The Kauffman Foundation reports that immigrants are twice as likely as people born in America to start a business.
Richard Herman is an immigration attorney in Cleveland. Herman and Cleveland Plain Dealer reporter Robert Smith wrote a book called Immigration, Inc.
Herman could go on all day with stats about how entrepreneurial immigrants to the U.S. are.
“Immigrants are filing patents at a two-to-one ratio [compared to] American-born,” he says. “Immigrants are more likely to have advanced degrees than American-born.”
And there’s more:
- In Silicon Valley, half of the tech companies were founded by immigrants. In Ohio, that rate is about 14 percent. It’s 17 percent in Indiana, 27 percent in Illinois and 33 percent in Michigan.
- Nationwide, 40 percent of today’s Fortune 500 companies were founded by immigrants, or the children of immigrants – like Steve Jobs.
Immigration is controversial in this country right now, because of added social service and enforcement costs, and because many believe unemployed American-born people could fill some of the jobs taken up by immigrants.
But in study after study, the data all points in one direction: Immigrants create more jobs than they take.
In the Midwest at least, policy makers are starting to take notice.
“I’m not into the politics of immigration, says Michael Finney, who heads up the Michigan Economic Development Corporation. “The facts of immigration says it’s good any place in the United States. The politics of it, obviously, says something different. And I think there’s just an awful lot of confusion with regard to the kind of immigration that’s really good for the United States.”
Finney says his office does work to increase opportunities for people born here.
“But we’d be remiss if we decided to ignore or work against the immigrant population,” Finney says. “Particularly those that are educated at our universities, and in many cases, they’re earning advanced degrees. And after completing those advanced degrees, we’re requiring them to leave the United States and go back to their country, and compete against us.”
Retaining and attracting immigrants has become a major focus for Finney, and the man who hired him, Michigan Governor Rick Snyder. They’ve started an initiative called Global Michigan.
More programs like it are popping up in the Midwest. In the next story for our series, we’ll look at some of those efforts.
The hope is, investing in immigrants will pay off, like it has many times before in this country.
Yesterday, we told you that Michigan’s native son, Mitt Romney, has fallen behind former Pennsylvania Sen. Rick Santorum in two pre-primary polls. Now, Romney is firing back in the Detroit News. not at his rival, but at union leaders and Obama administration officials.
Romney touches on many themes about the 2009 auto industry bailout. You can read the entire op-ed here. We picked out three things and provide some context.
1) The UAW. Instead of standing up to union officials, Romney says President Obama “rewarded them” with stakes in General Motors and Chrysler.
The stakes he refers to are held by the health care trust fund that administers benefits for UAW members. But the UAW did not get the terms it wanted. The union originally sought a greater share of GM, only to accept a counter offer from the Treasury Department.
Meanwhile, the Treasury also owns about 33 percent of GM, out of an original 61 percent stake.
2) Sell GM shares. Romney calls on the government to divest itself of its ownership position in GM. “The shares need to be sold in a responsible fashion and the proceeds turned over to the nation’s taxpayers,” Romney says.
Treasury officials say they are acting responsibly. The department holds roughly 500 million GM shares. It made its initial sale when GM went public in 2010, but has waited to sell the rest, presumably expecting the share price to rise.
At the time, GM shares traded at $33. On Monday, they closed at $25.34.
That means the Treasury would get even less for GM shares than it did in 2010 if it sold them now. There would be no profit for American taxpayers, since the stock needs to sell around $50 a share for Treasury to break even on what GM received in bailout money.
3) Car company founders. Romney, writing about auto pioneers like William C. Durant, Henry Ford, and Walter Chrysler, says, “These giants never envisioned a role for government in their business, but relied on the hard work and commitment of private individuals.”
That didn’t work out so well for Durant. He went to East Coast bankers for help shortly after he founded GM in 1908. They agreed to provide financing, on the condition that he resign. Although Durant later regained control of GM, he was kicked out yet again by investors in 1920.
February 8th, 2012
In a Michael Jackson music video, or an episode of Soul Train, Michigan governor Rick Snyder and Indiana’s Mitch Daniels might challenge each other to a dance off over Right to Work.
Instead, we have Snyder’s latest interview, in which he says Indiana ought to be worrying more about Michigan’s comeback.
Some context: Indiana and Michigan have been competing for years to land factories and convince businesses to locate in each state.
One of the biggest reasons why Snyder sought reform of Michigan’s business taxes in 2011 was so that the state could be on a more level playing field. It didn’t help that Indiana won a corporate headquarters formerly located in Michigan right after the state’s tax package was signed.
Now, Daniels has upped the ante by signing Right to Work legislation, which prevents unions from charging mandatory dues even if they represent a workforce. Many experts have said Michigan could be the next state to get such a law.
But Daniels, in an interview with Stateline.org, continues to oppose Right to Work for Michigan — and gives his neighboring state an elbow.
Asked if he’s worried about the new Indiana law, Snyder replies,
“If anything, Indiana was probably getting more concerned that Michigan’s back. We’re doing a lot of good things for our employers, with workers comp reform, unemployment insurance reform, having a balanced budget, education reform.”
Snyder goes on to say that he’d like everyone in the region to get along. “I think a lot of the Midwest should all want to come back together, so that it’s not one state versus another state. In many respects, the Midwest was treated as flyover territory and we’re a great place to be, for quality of life and everything else.”
As for the Right to Work fight, the Michigan governor says, “…I view it as a divisive issue. If you look at what’s gone on in the states, you have to ask the question, now what’s going to get done in Indiana for the next year or two? The fight isn’t truly over. It creates an environment where people are not working together.”
Read the Stateline.org interview with Snyder here. And enjoy some classic Jackson moves.
Niala Boodhoo · Originally Exempt From State Cuts, Wisconsin Police And Firefighters Now Face Changes Too
February 8th, 2012
This is the second in a two-part series about what’s changed for public workers in Wisconsin, one year after labor protests gripped the state (part one is here).
The Capitol building in Madison is amazing – anyone can just walk in. And in Madison, people often do just visit, like Brian Austin, who often brings his children here.
Austin is a detective with the City of Madison’s police department. He was also one of the tens of thousands who packed this building in protest when Gov. Walker proposed limiting union rights for public workers. The law – Act 10 – passed anyway. So Austin says when he goes into the building now, he can’t help think of it as a “completely different” building – and he means that in both a positive and a negative way.
His ambivalence is because he says Walker has brought the Wisconsin workers together – even though they’re suffering now.
The Wisconsin state worker’s union estimates that some 22,000 public employees are taking home 13 percent less pay since the law has taken effect. As it was written, public safety workers like police officers were supposed to be exempt.
But now, police and firefighters are finding, they, too, are facing increased pension and health care costs.
“We knew there was going to be a slippery slope,” says Jim Palmer, executive director of the Wisconsin Professional Police Association, the state’s largest police union.
“Economic conditions that are impacting Wisconsin aren’t going to go away,” Palmer says. “And we knew that if municipalities in this state continue to see a shortfall, and if police and firefighters are the only ones with collective bargaining rights, we would be next.”
Last fall, the city of Madison saved more than $2 million when the mayor asked police and fire unions to renegotiate their contracts. Now, workers are contributing three percent more to their pensions and are paying for their own uniforms. In return, no one was laid off or furloughed.
Palmer – the union rep – says that’s how collective bargaining is supposed to work. But it’s hasn’t been so agreeable elsewhere.
In a decision that’s yet to be announced, the Wisconsin police union and Eau Claire County have gone before the state labor board over police contracts there. Eau Claire’s corporate counsel, Keith Zehms, says the county is simply following the law.
“Our position is based on the change that the state legislature made in the law last summer,” Zehms says.
Zehms isn’t talking about Act 10. He’s referring to the state budget. It contained language allowing municipalities leeway in negotiating health care contracts for all of its workers – including public safety.
And that’s why some local governments are saying police and firefighters have to pay more on health care costs – regardless of what the union says. So the unions are fighting back. As of now, there are at least three court cases going on in Eau Claire, but also Milwaukee and Green Bay.
At issue is whether the unions have the right to bargain over health care costs – how much workers pay for deductibles and premiums.
Back at the capitol building in Madison, Detective Austin walks outside to where about one hundred people were singing. It’s a noonday protest that has occurred every day since last Feb. 14, when the protests really began. Austin isn’t the only public safety worker in the crowd.
Madison firefighter Cory Roberts says he’s there because even though his union has reached an agreement with his city, he’s worried about his colleagues elsewhere.
“People say you have amazing benefits,” Roberts says. “but, you know, those were negotiated in lieu of wages at some point.”
Roberts is holding a sign that says “Recall Scott Walker.” Last month, Wisconsin Democrats turned in one million signatures to recall Walker. His Republican supporters have until the end of this month to challenge the signatures.
Austin and Roberts both said something you hear echoed more than a few times by public safety workers in Wisconsin. Before last year, they stayed out of politics. But now, they’re actively engaged – trying to get the governor voted out of office.
February 7th, 2012
Yesterday, we told you about a program in Detroit that’s meant to keep homes occupied.
Now we’d like to know how you feel about it. Should cities cut deals in order to keep homes occupied?
We’re especially interested in views from home owners all over the Great Lakes.
Some people have struggled during the to pay their taxes (or have stopped paying them completely). Others dutifully write their checks.
If you don’t own a home, we’d like to hear your views. Would you be inclined to buy a property if you could get it for a super-low price, like Detroit’s $500 deals?
Please weigh in with your thoughts, and we’ll summarize them in a future story.
February 6th, 2012
On Friday, Caterpillar’s Progress Rail Services said it was closing its 62-year-old Electro-Motive Canada operation in London, Ontario, the subject of a union lock out since the beginning of the year. Now, it looks like some of the plant’s 475 jobs could be headed for Indiana, reports the Globe and Mail in Toronto.
Caterpillar held a jobs fair in Muncie, Ind., over the weekend, that drew thousands of applicants. Some job seekers showed up at 4 a.m., five hours before the company began letting people in the door. In all, about 3,000 people turned out, according to the Muncie Free Press.
The New Year’s lock out of the Canadian Auto Workers union came after the CAW refused to accept deep concessions that would have cut hourly pay in half.
The move comes just as Indiana is implementing its new Right to Work law, signed by Gov. Mitch Daniels last week. The law prevents unions from charging mandatory dues, even if they represent a workforce.
In explaining the shutdown, Billy Ainsworth, the CEO of Progress Rail, said in a letter to employees that all the company’s facilities “must achieve competitive costs, quality and operating flexibility to compete and win in the global marketplace, and expectations at the London plant were no different.”
February 3rd, 2012
Politics is front of mind here in the Midwest. We’re also thinking about what to wear, watch, and where our friends went. Here’s a roundup of our top Changing Gears stories this week.
WiSCONSIN: Niala Boodhoo went to Madison, where she showed us how union members are still protesting a year after Gov. Scott Walker eliminated public employee collective bargaining rights. She reported on how they’re faring.
RIGHT TO WORK: Indiana is now the nation’s 23rd Right to Work state, only two months after Gov. Mitch Daniels made the legislation one of his top priorities. Will Michigan be next?
MIDWEST MIGRATION: Our Public Insight team has been tracking the stories of people who’ve left our states. There’s still time for our exiles to call us and leave messages for the folks back home. Meanwhile, read much more on our dedicated page.
T-SHIRTS: If you seek a Midwest t-shirt, look about you. Dustin Dwyer found our states are chock full of small companies making t-shirts that represent our region.
DIY DETROIT: Have you found that all those documentary films about Detroit are starting to look the same? Dustin offers you a how-to kit for making your own Detroit documentary.
Finally, a shout out to Troy “Trombone Shorty,” who sings the Changing Gears theme. He’s been immortalized by the New Orleans Jazz Fest.