Norm Blumenthal – an attorney for workers and consumers. Selected as one of the Top Attorneys in Southern California. Norm was inducted and recognized as one of America’s Most Trusted Lawyers in Employment Law.
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Bert Martinez: On the show today, Norm Blumenthal. Norm Blumenthal is an attorney for workers and consumers. He kinda protects the average working man. He’s selected as one of the top Attorneys in Southern California, Norm was also inducted and recognized as one America’s most trusted lawyers in employment law.
Norm Blumenthal, welcome back.
Lawyer Norm Blumenthal: Nice to be here, Bert. Thought we’d do the show today on, the changing paradigm as to now labor is king, And, used to be the management was king for quite a number of years, in the past when you and I were fighting, See if we could get minimum wage of $10, and it was a big deal. $10. Oh my god. That’s just a huge sum. And now I feel like we’re at minimum wage of $25 an hour, $50,000 a year. It’s Kind of across the board, California just enacted for fast food workers $20 an hour minimum. That doesn’t include all the tips that are handed out.
So it’s about 25 across the board, but if you think back, when I first started working, which was in the sixties and that is the 1960’s, the minimum wage was a dollar to 25¢. So if you can believe that, and, it’s all a product of inflation.
And, first, we had inflation on products, and then we had inflation on management’s, piece of the pie and profits and the Stock market’s soaring, and now it’s labor’s turn. You know, the pendulum swings back and forth. It goes too far one way, then it comes back too far the other way. And What ended up happening is, companies just went too far in their compensation for management, as a result of increased profits across the board.
And now the pendulum’s coming back the other way. We see our president, You know, on the picket lines with the UAW. So that kinda tells you something
Bert Martinez: And the deal is this. Look, you and I are entrepreneurs. We wanna keep our costs as low as possible. We wanna make our profits as high as possible. But I think you and I also have a consciousness about our capital.
There’s no point in a lot of companies that are like this, but unfortunately, there’s even more companies that are not like this. And what I mean to say is there is no point in paying your employees so poorly that they Have to get assistance from the government. Walmart does this.
Wells Fargo started doing this a few years ago where they cut everybody’s hours to 32 hours a week so they could get away with the bare minimum, not pay any benefit. What is the point of crushing the most important people in your business? Because if your employees are unhappy. They’re gonna do a crappy job. They’re gonna call in sick more. There’s not gonna be any loyalty there. And so, yes, as entrepreneurs, as small business owners, we wanna keep our costs low, we wanna make our profits high, But we also have to be aware that our employees make or break our business.
Lawyer Norm Blumenthal: It’s interesting how it works. It used to be, unions had no power at all, and now we have the United Auto Workers. They’re threatening to go on strike. We have hotel employees. They’re threatening to go on strike. We have the hospital workers from Kaiser. They’re threatening to go on strike.
And they’re all in unions, And they’re all organized and unions are now at, their popularity is in the 60 to 70% people believe in them and that’s that’s a change in the paradigm where unions actually have some power and can do some things to protect their employees.
So that’s what we’re seeing, and it’s a good thing. I mean, they have to share the wealth With their employees, these companies have made a lot of money. Inflation has yeah. Okay. Products cost We get that, everybody has that. But by the same token, everybody wants to make more. And I think that’s what we’re seeing.
And the auto workers, Same thing. They’re gonna come up with an agreement, you know, and they’re and that will be what they’re, you know, making. Same thing with casino workers. You know, 60,000 of those, 75,000 health care workers. So it’s a backlog of the unions. And then once the unions get these salaries, it trickles down to the companies that are not do not have union employees, and they’ll get an increase in wages. So it’s gonna it’s like a tidal wave. It’s running across the country.
Companies do good, management does well, management does well, employees do well. And so that’s where we’re now we’re at the level as this pendulum swings in favor of the employees. Today, President Biden announced that he is in the medic, Drug companies have agreed to meet with, government to set lower prices on the first 10 drugs that have market prices which are way above what’s needed to make a profit.
So Everything is is coming into line, and goods will come, you know, will level off the cost, and in Drug cases will come down. Services will go up, but people will make more. When my first job I took as a law clerk, I was making $16,000 a year. If $16,000 a year is about, you know, $15 an hour, and I that’s with a law degree in 1970, 19 73.
So It it you know, everybody just needs to get used to it. We’re and that’s why you need wherever you go and whatever you work for, you need the current salaries, the current rates, you know, to get that job and and get what you’re entitled to.
Bert Martinez: Well, and here’s the thing, let’s be real. Costs are gonna go up anyway. That’s what companies do. So they do it in a couple of different fashions. Sometimes they will raise the prices just straight across the board, very obviously, and and, you know, they don’t give you an excuse or anything. They just raise their prices because they can’t. It’s called, the, what do you call it? Law of demand. Right? So if demand rises, if demand goes up, they’re gonna raise their prices because they can.
Whether or not it costs them more money, whether or not they’re paying their employees more, they’re gonna raise the prices. Another way that they do it, this is really below the radar, kind of, covertly, they reduce the amount that’s in the purchase. So if you’re used to you know, if you’ve ever bought a big bag of chips and then you open it up, it’s half empty, boom, they just raised their prices by putting less in that bag and it’s very, like I said, covertly.
There’s a couple of ways they do it. So Regardless of what they pay their employees, they raise their prices and the pharmaceutical industry does it all the time. In fact, one of their favorite things to do is that, they will buy a pharmaceutical company, a smaller one, And, this happens very much. I think if there’s a recent case, where, I think it was senator, what’s her name is Katie something. She’s very, very good about slapping these guys around. So this large pharmaceutical company bought a smaller one. The smaller one was making a really hefty profit as it was. They took over that company and they immediately We doubled or tripled the price of the medication because they could.
It didn’t cost them anymore. They’re still gonna profit if they leave the price alone, but no. Because this is a cancer, hearing type medicine, they doubled or tripled the price in this senator, she’s famous for doing this, Katie something, took him to task. My thing is they’re gonna raise their prices anytime they can regardless of their profit or their cost?
Lawyer Norm Blumenthal: That’s why this is a good thing for the drug companies to come in and start negotiating with the government on price because, obviously, the government is the biggest buyer out there. We’re very fortunate in this country because we have more openings for jobs, than we have employees. We have 8,000,000 jobs right now that we need employees to work.
In China, On the other hand, it’s completely the opposite. They have all these trained technicians and, people that do work and manufacturing jobs, really, where there’s no job available. And there’s millions of Chinese that are not working. And what they’re ending up doing is they’re going back to live with their parents.
I mean, we’ve seen that story before in this country. But that’s where China is. So China’s a real mess. And we’re very fortunate now because there are all these jobs and because there’s a greater demand for employees, and there are jobs right now.
There’s more jobs than eployees there would then we can fill. To get the employees, you have to pay more. And this is a good paradigm to be in for the employees, and we’re taking advantage of it in this country. And we’re fortunate that we’re able to do that because our dollar’s strong, And, we’re in really good shape in the marketplace.
So we’ll see where we go. There’s issues obviously in the government. They need to get their act together. So the federal government and state governments are doing what’s best for their citizens and they’re companies, and, not what’s, what’s destructive. And so we’re we’re we’ve got that issue to deal with right now, but that’s kind of the last little bit of problems that we have is figuring that out and and starting in a time like this, this is a time when the government is supposed to pay down its debt. When, we Have a strong economy, strong wages, lots of money coming in from income taxes. We have to get our Our government in order, and right now, it it it’s not there. I don’t, you know, I don’t pretend to know what the answer is to it, but we’re spending Way too much more than we bring in.
So, you know, 2 things have to happen. We have to bring in a little more, and we have to spend a little bit less. Where that comes from is, you know, where the rubber meets the road. The trouble is that’s all politics, and no one wants to be the one to get less money.
And, you know, no one wants to be cut off from that money source. So it’s and no one wants to pay more taxes. So where do we go from here? Because we’re now reached the point in the story where we’ve got wages up. You and I have been fighting for an increase in wages now for well over 5 years, maybe closer to 10, and we won that battle.
And we’ve been fighting for a reduction in drug prices forever, and we’ve won that battle. So now we’re down to the point where you just can’t keep printing money and having debt, and still expect to be the number one economy in the world.
We need to figure out a way that we can harness the income. Where, it’s not an excess burden on the employees, and it’s not an excess burden on companies, and it’s not an excess burden on capital. and the one way that I’ve seen, from my experience to do it is the payroll tax. Right now, the payroll tax is 15%. 7 a half percent paid by the employer And 7 a half percent paid by the employee. No one and people look at their wage statement, they see Medicare, Medicaid, You know, you always see the deduction for that. That’s what it is.
And no one really says boo about it. I mean, it just comes out. The government takes it. You never touch it, and you don’t you don’t count it in your money that you need to spend to make ends meet, you know, the ones who are living paycheck to paycheck, or to put in your, in your IRA or your retirement account or Just your bank account to have for for a rainy day.
So this is the place where the most painless, let me put it that way, place you can increase revenues for the government, while at the same time not changing the, anything that you take out of your pocket that you’ll miss. So if it went up to 8 a half percent each, which, you know, is 17%. no one, no one’s gonna miss that difference, but it’s a huge sum when it comes out of your payroll. So and now that payrolls are going up, it could become a larger sum, and that’s the place to go.
Hopefully the government will see that, where they can take in some extra dollars.
Bert Martinez: Right. You know, backing up the health care workers, I know, That, we hear all the stuff about we have a nursing shortage, which is probably true, but here’s what’s happening. And I know this from first experience because I have several, short term rentals that I rent quite regularly by traveling nurses.
So if you are a traveling nurse, they pay you almost double what a local nurse gets paid per hour and they pay you a living Stipend to cover your rent, they pay all of your travel expenses. So this doesn’t make sense to me. If you can afford to pay a nurse because she’s willing to travel $100 an hour, why don’t you pay her $50 or $60 an hour and keep her at home where she wants to be anyway. Now again, if I look, a lot of the people that I’ve interacted with, these are young people and they want to travel a little bit and see the world. Great. I get that, but it just goes to show you how, messed up it is that we’re going to pay a traveling nurse what equates to about $200 an hour when it’s when you factor in everything, but you’re not willing to pay a nurse, a local nurse, 50, 60, $70 an hour, and nurses are super vital.
Without a good nurse, everybody knows. Everybody’s been if you’ve been to the hospital a few times for delivering a baby or for other reasons, A good nurse makes that experience a wonderful experience. A good nurse builds that confidence. It’s just a wonderful experience to have versus a bad nurse. So anyway, yeah, we have to take care of our nurses.
Lawyer Norm Blumenthal: There’s, you know, there’s clearly a shortage. That’s part of the 8 million jobs we need to fill in In the hospitals. That’s why the Kaiser workers are walking off either this week or next week because there’s a shortage of workers. And what they’re fighting for is not higher wages. They’re fighting for hiring More nurses, exactly what you’re saying, to take care of the patients because the patients aren’t getting the kind of care that they’d be entitled to. The nurses are saying they’re doing the jobs of 23 people, and it’s not fair to the patients. So everything you’re saying is correct.
And what you need is and what we have in California, which really helps are community colleges. Everybody doesn’t have to be a doctor or a lawyer or an Indian chief as that used to say. You can be, I have a technician’s job as a nurse and make a very good living wage, and you go to community college, a 2 year college, and you learn to be a nurse. And this is, and California has a great community college system. And if you want to advance on it, after you go to a community college, you can go to a 4 year college. From there, transfer right over for additional education. But that’s what you needed.
The starting point is it’s not gonna happen in a day. It’s gonna be like we worked on raising wages. Now we have to work on filling these jobs, and there’ll come a time, Bert, you and I will talk, and you’ll say, well, we can’t find people, we can’t find jobs for everybody, and, you know, it goes the pendulum goes back and forth.
But right now, we have a tremendous number of jobs that are going unfulfilled, and it requires this education in California. You can go to community college, you know, and you Spend $40 a semester. I mean, it’s just for semester credit. It just doesn’t cost much to go to community college and they’re working towards making it free. That’s the magic part of the formula, And in time, we’ll have all the nurses we need, but that’s not where we are right now.
And so we’ll get there. But, right, and you have to pay them more. You’re right. You can’t pay a traveling nurse disproportionately more than someone that lives there. But there’s no one in the area that is willing to take those jobs because they don’t have the training. You know, you and I cannot go into a hospital and be nurses. That’s for sure. And so there’s the same thing with all the Restaurant help. They can’t go in and be nurses. They need a couple years of training, at a minimum, So that they can do just the monitoring that’s involved in people. You know, they don’t keep people in hospitals very long anymore if they can help it. So the people that are there, they need constant monitoring, and the nurses job. To make the rounds and monitor the people and make sure what they need, they’re getting. And what they don’t need, they’re not getting. So, yeah, that’s what’s happening.
And, you know, on the same level, casino workers. I mean, it’s just, you know and, of course, that’s completely different. No one needs to be gambling in a casino, but people do it. And to service them, they need to pay the casino workers more. Correct.
Do you know they’re working long hours and they aren’t getting paid more than auto workers? Everybody is switching over to electric, and hybrid cars. And there’s a huge demand and there’s, you know, there’s jobs. Buy as many as you want to build these cars in America, which is a great thing, you know, with all the auto jobs here. So it’s a plethora of of good jobs, hard paying jobs that people can get, And they should take advantage of it, and take advantage of these higher wages that are out there, and take advantage of the lower cost of of tech school, education to qualify themselves for these jobs that, that are out out there and need employees to work in.
Bert Martinez: Absolutely. Look. I’m glad you brought it up. The tech schools, the trade schools, super important, I would say, it’s a balancing act because, yes, in one sense, doctors, lawyers, CPA might have a higher status in our society. They are certainly important, but, we also need those plumbers, we need our cars fixed, you know, we need our homes remodeled, all of those things, and if everybody, Ignore these very important trade, jobs. Before you know it, You’re gonna be paying more for the plumber than you are for the doctor.
Lawyer Norm Blumenthal: You can’t find a plumber today. I mean, once you have one, you just pay him whatever he says, happy to have a plumber fix your plumbing. Let’s face it. And, you know, a good plumber I mean, there’s a lot of people that say they’re plumbers, but, you know, a good plumber is hard to find. It’s that, I say when you buy a piece of property, make sure you have a good plumber on hand, when you buy a piece of property, because that’s the most important thing. There’s nothing worse than a plumbing problem in anybody where anybody lives. Tenant, owner, whatever it’s gonna be.
And so there’s not enough plumbers out there that are qualified. You can and, What do you know? You’re a contractor. You wanna make yourself a plumber. I don’t know what you look for in finding someone. If you go in the yellow pages, you get a company and someone shows up, he’s an independent contractor. Who knows what his experience is? But that’s just the way it is, because there’s just more jobs out there than there are people to fill them. And that’s where we are right now. And it’s a good thing because everybody’s getting higher wages.
You know, we’re not talking about $10 an hour or $12 an hour or $15 or fighting. Remember that fight we had. Or we’re rolling right through 20 to 25, but we gotta take care of our house. We gotta keep it in order. We gotta get our budget on track to eventually balance it like we did when Clinton was president, and we gotta do it in the least painful way. And, the and it’s gotta go across the board. I mean, everybody can pay a little bit more.
Bert Martinez: Absolutely. And here’s the other thing, because you mentioned, you know, we need to get our congressional house in order. It’s really simple. Let’s vote out those individuals that aren’t working, which is most. Vote voting is the power that has been given to us. Don’t ignore it.
Let’s Use it. Some of these people honestly, I don’t wanna sound ages, but some of these people are too old. They’re barely functioning. It’s time for them to retire. Orrin Hatch, who I met several times. Personally, I liked him. But come on. He stayed there too long.
And you have the other politicians that spent all of their time bickering and arguing and road blocking anything that the other side doesn’t know, it is trying to promote. I wanna get rid of these people too, and it’s on both sides of the aisle. If our politicians cannot work together for the betterment of America, Then we need to find others that can. That to me, that’s like the simplest way to fix it. I don’t expect them to agree on everything, But I don’t need a bunch of disagreeable people because all of this chaos and all of this contention isn’t making America.
Lawyer Norm Blumenthal: You don’t need to be a Democrat or a Republican. You need to be a problem solver. And people on the fringes on both ends were, you know, everything has to be given or when nothing has to be given Isn’t working. There’s a problem there’s what’s called the problem solver caucus in congress. And that’s, persons on, Democrats and Republicans who came together, in the end to pass, you know, a budget referendum to get it passed at least to keep the government open. I don’t know what the big deal is keeping the government open.
My god. That’s the craziest thing you’ve ever heard. But there’s people In government, that’s what they’re there for. They’re Trump accolades that what they wanna do is burn the house down, Literally. And, you know, that’s what they wanna do. So why would anybody ever wanna put somebody that wants to destroy the country into congress. It’s nuts. They should be shown the door, quickly. And I mean, being in this small group, they shouldn’t be heard from. They should be put in the corner and get back that little office with no windows and leave them.
Bert Martinez: Right. And the situation has become unsustainable. Bottom line is if there are some people in the house there that if the Republicans come up with a good idea, They’re going to oppose it just because they’re the Republicans who came up with it. If a Democrat comes up with a good idea, same thing.
The Republicans are gonna oppose it because they didn’t think of it, and we see this all the time. This government shutdown thing is done all the time to embarrass whatever party is in power. And again, You know what? It’s great.
It’s great to be able to help people, but at the same time, we can do a better job balancing our budget. You and I’ve spoken several times about the fact that there are some multi billion dollar companies that are highly profitable. They’re making billions of dollars in profits a year, And guess what? They get millions and millions of dollars of welfare from our government, the corn industry, the dairy industry, The beef council, you name it. All of these big industries are being subsidized by our government. Why? They’re they’re profitable. I mean, this has gotta stop.
Lawyer Norm Blumenthal: And there’s an issue there. They’re, across the board, tax on revenues for companies, period 15% minimum, tax for companies across the board. Why not? I mean Right. It’s and then you start there. It’s just like the payroll tax. You have a minimum payroll tax. No one knows about it. Same thing with the minimum corporate tax.
You go into your accountant. These companies have the best accountants in the world, And he can pull every string, but at the end of the day, he can’t you can’t you gotta have a tax that they can’t get rid of. And because everything else is, you know, fungible, they can get rid of it. So if you had a corporate minimum tax, same idea. You know, you put it in there and it’s paid, and we can get you know, it won’t hurt people so much. You increase the payroll tax, it won’t hurt so much, and give a little bit here and a little bit there.
We’re not gonna get rid of the lobbyists, and we’re not gonna get rid of that but all things being equal, you’re just not gonna get rid of these, handouts for agriculture oil and other, companies that are just not gonna go, but you can do something across the board. And that’s what we have to think about, getting done.
Because at the end of the day, you gotta pay your debts off or have a way to pay them off Somewhere, somehow. And people are making a lot of money, so now is the time to, and companies are making a lot of money To put a little little little more tax across the board to get this thing, get the country this house in order.
Bert Martinez: Absolutely. Norm, we’re out of time. Always good to have you on the show. I’m looking forward to having you back and seeing, what do you call it? What else can we move forward.
Lawyer Norm Blumenthal: It’ll be an interesting year. You know, we’re going into an election year, so it’s gonna start to get exciting.
Bert Martinez: Absolutely. I’m glad you brought that up, and again, get out there and vote folks.
This is your chance to make a change.
