Bucking the paid labor trend

Over the past few years, headline writers at City Business and The Times-Picayune have promoted a pet myth of a recession-proof New Orleans "recovery" economy "bucking the trend" of national hard times. The loosely implied thesis is based on two ideas. The first part of the theory holds that since the local job market is heavy on T-shirt & booze pedaling and light on manufacturing or technology or finance it isn't as vulnerable to the kinds of shocks that have affected other parts of the country. Or, since there aren't many real jobs around here in the first place, there aren't that many to lose either. And while that may be kind of true, it seems an inappropriate cause for cheering in the business pages.

The second major tenet of trendbuckery asserts that because the Federal Flood left us with so much shit to either knock down or rebuild (but mostly knock down) we're in the midst of an unparalleled construction boom. This is also partially true but, again, less than cheering when one takes into account the degree to which it relies on a system of slave labor.

About 80 percent of wage laborers in New Orleans, mostly Hispanic, report they have been stiffed. New Orleans has the highest incidence of wage theft by far in the South, according to a survey by the Southern Poverty Law Center.

"This isn't a few bad apples," Gonzalez said. "It's systematic."

Neither does it affect only the 30 or so members of the Congress of Day Laborers, affiliated with the Center for Racial Justice, who showed up to the council meeting in work clothes and boots, wearing Spanish and English "Stop wage theft!" stickers over their hearts.

Darnell Parker, a black U.S.-born day laborer, said one contractor waited until a grueling job was finished to tell him he was being paid less than expected. The only explanation offered by the contractor was that he changed his mind.

Licensed union contractors also lose out: They are at a disadvantage if they have to compete against freelance contractors who can underpay laborers without facing penalties from a union or the police, experts said.

Wage thieves drive "honest businesses out of business," said Ted Quant, director of Loyola's Twomey Center for Peace through Justice. Homeowners lose out at that point because the pool of contractors available for jobs thins, Fielkow said.

Thanks should go to Councilman Fielkow for hosting that hearing, by the way.

Meanwhile, also not magically insulated from the national recession is the local financial sector.

NEW YORK — Continued problems with repayment of mortgage loans in Whitney Holding Corp.’s Florida markets has led Fitch Ratings Service to downgrade the company's ratings, and its forecast is that the situation is not likely to improve in the near future.

Investors refer to Fitch ratings to gauge the perceived health of the company.

Fitch lowered Whitney’s long-term Issuer Default Rating to BBB from BBB+ to reflect the bank’s increased level of nonperforming assets.

Whitney Bank is a subsidiary of Whitney Holding Corp. It's unclear to me just how insulated Whitney is from its parent's investments but suffice to say there's almost no such thing as a local bank anymore. If you're a lending institution, chances are you've been affected by "troubled assets" in one way or another.

Now if Whitney happened to have a friendly Senator or two lying around someplace, things might be a bit different.

Sen. Daniel K. Inouye's staff contacted federal regulators last fall to ask about the bailout application of an ailing Hawaii bank that he had helped to establish and where he has invested the bulk of his personal wealth.

The bank, Central Pacific Financial, was an unlikely candidate for a program designed by the Treasury Department to bolster healthy banks. The firm's losses were depleting its capital reserves. Its primary regulator, the Federal Deposit Insurance Corp., already had decided that it didn't meet the criteria for receiving a favorable recommendation and had forwarded the application to a council that reviewed marginal cases, according to agency documents.

Two weeks after the inquiry from Inouye's office, Central Pacific announced that the Treasury would inject $135 million.

Now there's how you go about bucking a trend.