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How to escape from a money rut

April 26 ,2024

Sometimes, climbing out of a money rut starts with a pep talk — to yourself.
:  
Kimberly Palmer, NerdWallet

Sometimes, climbing out of a money rut starts with a pep talk — to yourself.

“I like affirmations and speaking out loud,” says Giovanna Gonzalez, a financial educator and author of “Cultura & Cash.” Her favorite affirmations are statements like, “I am not a reflection of my money mistakes,” “I can improve my financial situation,” and “My finances are within my control.”

If you find yourself repeating frustrating money patterns, such as overspending or struggling to pay off debt, that kind of attitude shift can help get you on a different path, Gonzalez says. “Mindset is so important, and sometimes we end up being very hard on ourselves for making bad money choices. If we don’t forgive ourselves, it can be a barrier to doing better.”

Financial experts also recommend using the following methods to climb out of a money rut:

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Pick an exciting goal


Sometimes, our money goals can inspire us to think bigger and more creatively about our financial lives. Elaine King, a certified financial planner and founder of the firm Family and Money Matters in Miami, says she finds people often need a “money motivation” or an exciting goal to inspire them to adopt better financial habits.

“It has to be something you really want, like traveling. Maybe you really want to go to Europe or get a car or a graduate degree or start a business,” King says. Give yourself a dollar amount and a goal date, and then you can start working toward it by setting aside small amounts of money from each paycheck.

Gonzalez recommends making the objectives visible in your home. When she was planning for a trip abroad, she put a large map on her wall to keep the goal front and center. She says changing the background on your phone to represent the target, such as a screenshot of a debt payoff sign or a dream home, can also work well.

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Break big tasks into smaller ones


If your goal is overwhelming, divide it into smaller pieces, suggests Don Grant, CFP and partner at Sabre Wealth in Wichita, Kansas. If you have $30,000 in high-interest consumer debt, for example, then break it into smaller wins of paying off $5,000 at a time by different dates, for example.

“If you’re wondering, ‘How am I ever going to pay it off?’ that would be the definition of being caught in a rut,” Grant says. “It helps tremendously to break it into small chunks and celebrate the small wins that you have.”

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Unload debt that’s dragging you down


With some progress under your belt, you can settle on a sustainable approach to knock out the debt, says Sharon Lechter, author of “How Money Works for Women.” She suggests selecting either the snowball method, where you first pay off the smallest debts and work up the momentum to tackle the bigger ones, or the avalanche method, where you pay off the debt with the highest interest first.

“You will feel empowered because you took the first step,” Lechter adds.

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Take a close look at spending patterns


Examining your current spending habits can inspire some small tweaks that lead to increased savings, Lechter says. She suggests categorizing how you spend your money over the last 12 months and then comparing those averages with ballpark recommendations. For example, the 50/30/20 budget suggests spending 50% of your after-tax income on needs, including minimum payments on debts; 30% on wants; and 20% on savings and debt payments beyond those minimums.

If you notice habits that lead to overspending, such as going to a weekly happy hour that turns into a multihour expensive meal, then Grant suggests starting a new routine instead. Taking yourself out of pricey situations and replacing them with other activities makes it easier to spend less, he says.

King recommends trying “a couple months of detox and just buy the things you need. Subscriptions, gym membership, extra clothes, shoes, restaurants — you don’t need them.” Severely restricting your spending for a short period can help you reset going forward, she adds.

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Find someone to encourage you


“Don’t be afraid to reach out for help,” Grant says. That help might come from a financial professional such as a CFP or a trusted friend or family member who can motivate you along the way. “If you tell people who care about you, they will help you and encourage you,” he adds.

Lechter suggests surrounding yourself with people who also want to make a positive change in their own lives. “Those friends and family will be proud of you,” she says, versus feeling threatened or envious.

And they can also help you celebrate when you reach a milestone, like paying off the last credit card or saving enough to go on a big trip.

State takes aim at charter schools

April 26 ,2024

The Michigan State Board of Education passed a resolution earlier this month that could regulate charter schools out of existence.
:  
Molly Macek, Mackinac Center for Public Policy

The Michigan State Board of Education passed a resolution earlier this month that could regulate charter schools out of existence. The resolution was prompted by false claims about lack of charter school transparency. And this could have dire consequences for these public schools, which are already subject to strict oversight.

The resolution calls for greater financial transparency, and many additional regulations, for Michigan’s charter schools. But as public entities subject to the Freedom of Information Act, charter schools must comply with the same transparency laws as conventional public schools.

According to Steve Delie, director of labor policy and FOIA coordinator at the Mackinac Center for Public Policy, “The State Board of Education appears to misunderstand the current state of the law. Michigan charter schools are subject to FOIA, just like traditional public schools.”

But even though the resolution’s premise – that charter schools are not held to the same transparency standards as other district schools – is inaccurate, it is used to justify additional charter school regulations.

To be fair, the management structure of charter schools, and how it impacts their transparency requirements, can be confusing. Most charter schools are operated by a management company that provides certain services, such as teaching, food and custodial. Most conventional public schools also contract with private companies to provide some of these same services. Whether they provide services for charter or conventional public schools, these companies are not subject to FOIA because they are private.

Even so, the resolution calls for all for-profit charter management organizations to be transformed to nonprofit management organizations. Since conventional public schools also contract with for-profit private companies for some of their services, the impetus for this provision is unclear. It would, however, be a significant hurdle for charter schools to navigate because most of them are operated by for-profit management companies.

The resolution also calls for the Michigan Department of Education, with input from local districts, to approve or deny applications for new charter schools. This would amount to a transfer of power from public universities and community colleges — the public oversight bodies that currently decide whether to approve new charter schools — to the Department of Education. Districts tend to oppose the opening of charter schools because they don’t want the competition for families that these schools would bring.

While competition might be an inconvenience for conventional district schools, it leads to more diverse opportunities for the students. Many students, especially those from low-income backgrounds in urban areas, perform better in charter schools, compared to their peers in the local district schools. Limiting educational options would place these students at a greater disadvantage.

Detroit charter schools give many city residents a learning advantage over students at their local district schools. The top open-enrollment middle schools in Detroit are charter schools, according to U.S. News and World Report’s rankings of the best Michigan schools. The best elementary schools are charters, too – even when compared to selective schools in the district.

According to Delie, “Regulating charters out of existence is a poor response, particularly given the pressing need to recover from COVID-era learning losses. With more and more parents choosing educational options outside of the public school system, the state should be encouraging more options and improving existing ones, not forcing students into a one-sized fits all solution.”

The regulations imposed by the resolution would severely limit access to new charter schools and impede the operations of existing ones. If they want to do what’s best for students, state board members ought to adopt policies that support – not hinder – the diversity of educational opportunities available to Michigan families.

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Dr. Molly Macek is the director of education policy for the Mackinac Center for Public Policy.

TikTok fears point to larger problem: Poor media literacy in the social media age

April 26 ,2024

The U.S. government moved closer to banning the video social media app TikTok on Apr. 24, 2024 after President Joe Biden signed into law a $95 billion foreign aid bill.
:  
Nir Eisikovits, UMass Boston

(THE CONVERSATION) — The U.S. government moved closer to banning the video social media app TikTok on Apr. 24, 2024 after President Joe Biden signed into law a $95 billion foreign aid bill. The law includes a provision to force ByteDance, the Chinese company that owns TikTok, to either sell its American holdings to a U.S. company or face a ban on the app in the country.

TikTok has said it will fight any effort to force a sale.

The proposed legislation was motivated by a set of national security concerns. For one, ByteDance can be required to assist the Chinese Communist Party in gathering intelligence, according to the Chinese National Intelligence Law. In other words, the data TikTok collects can, in theory, be used by the Chinese government.

Furthermore, TikTok’s popularity in the United States, and the fact that many young people get their news from the platform – one-third of Americans under the age of 30 – turns it into a potent instrument for Chinese political influence.

Indeed, the U.S. Office of the Director of National Intelligence recently claimed that TikTok accounts run by a Chinese propaganda arm of the government targeted candidates from both political parties during the U.S. midterm election cycle in 2022, and the Chinese Communist Party might attempt to influence the U.S. elections in 2024 in order to sideline critics of China and magnify U.S. social divisions.

To these worries, proponents of the legislation have appended two more arguments: It’s only right to curtail TikTok because China bans most U.S.-based social media networks from operating there, and there would be nothing new in such a ban, since the U.S. already restricts the foreign ownership of important media networks.

Some of these arguments are stronger than others.

China doesn’t need TikTok to collect data about Americans. The Chinese government can buy all the data it wants from data brokers because the U.S. has no federal data privacy laws to speak of. The fact that China, a country that Americans criticize for its authoritarian practices, bans social media platforms is hardly a reason for the U.S. to do the same.

I believe the cumulative force of these claims is substantial and the legislation, on balance, is plausible. But banning the app is also a red herring.

In the past few years, my colleagues and I at UMass Boston’s Applied Ethics Center have been studying the impact of AI systems on how people understand themselves. Here’s why I think the recent move against TikTok misses the larger point: Americans’ sources of information have declined in quality and the problem goes beyond any one social media platform.

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The deeper problem


Perhaps the most compelling argument for banning TikTok is that the app’s ubiquity and the fact that so many young Americans get their news from it turns it into an effective tool for political influence. But the proposed solution of switching to American ownership of the app ignores an even more fundamental threat.

The deeper problem is not that the Chinese government can easily manipulate content on the app. It is, rather, that people think it is OK to get their news from social media in the first place. In other words, the real national security vulnerability is that people have acquiesced to informing themselves through social media.

Social media is not made to inform people. It is designed to capture consumer attention for the sake of advertisers. With slight variations, that’s the business model of all platforms. That’s why a lot of the content people encounter on social media is violent, divisive and disturbing. Controversial posts that generate strong feelings literally capture users’ notice, hold their gaze for longer, and provide advertisers with improved opportunities to monetize engagement.

There’s an important difference between actively consuming serious, well-vetted information and being manipulated to spend as much time as possible on a platform. The former is the lifeblood of democratic citizenship because being a citizen who participates in political decision-making requires having reliable information on the issues of the day. The latter amounts to letting your attention get hijacked for someone else’s financial gain.

If TikTok is banned, many of its users are likely to migrate to Instagram and YouTube. This would benefit Meta and Google, their parent companies, but it wouldn’t benefit national security. People would still be exposed to as much junk news as before, and experience shows that these social media platforms could be vulnerable to manipulation as well. After all, the Russians primarily used Facebook and Twitter to meddle in the 2016 election.

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Media and technology literacy


That Americans have settled on getting their information from outlets that are uninterested in informing them undermines the very requirement of serious political participation, namely educated decision-making. This problem is not going to be solved by restricting access to foreign apps.

Research suggests that it will only be alleviated by inculcating media and technology literacy habits from an early age. This involves teaching young people how social media companies make money, how algorithms shape what they see on their phones, and how different types of content affect them psychologically.

My colleagues and I have just launched a pilot program to boost digital media literacy with the Boston Mayor’s Youth Council. We are talking to Boston’s youth leaders about how the technologies they use every day undermine their privacy, about the role of algorithms in shaping everything from their taste in music to their political sympathies, and about how generative AI is going to influence their ability to think and write clearly and even who they count as friends.

We are planning to present them with evidence about the adverse effects of excessive social media use on their mental health. We are going to talk to them about taking time away from their phones and developing a healthy skepticism towards what they see on social media.

Protecting people’s capacity for critical thinking is a challenge that calls for bipartisan attention. Some of these measures to boost media and technology literacy might not be popular among tech users and tech companies. But I believe they are necessary for raising thoughtful citizens rather than passive social media consumers who have surrendered their attention to commercial and political actors who do not have their interests at heart.

Senate approves nearly $61B of Ukraine foreign aid - here’s why it helps the U.S. to keep funding Ukraine

April 26 ,2024

The Senate overwhelmingly approved a US$95.3 billion foreign aid funding package for Ukraine, Israel and Taiwan on April 23, 2024, following months of political infighting that stalled the bill in the House of Representatives.
:  
Tatsiana Kulakevich, University of South Florida

(THE CONVERSATION) — The Senate overwhelmingly approved a US$95.3 billion foreign aid funding package for Ukraine, Israel and Taiwan on April 23, 2024, following months of political infighting that stalled the bill in the House of Representatives. About $61 billion of this aid package will be spent on Ukraine, while $26 billion will go to Israel. Another $8 billion is designated for Taiwan.

President Joe Biden has said he would sign the bill into law within days.

The Senate voted for the aid package with a 79-18 vote late on Tuesday evening, while the House approved the bill on April 20 with a rare bipartisan coalition that voted 311-112 in favor of aid to Ukraine.

“Today’s outcome yet confirms another thing we’ve stressed from the beginning of this Congress. In divided government, the only way to ever get things done is bipartisanship,” Senate Majority Leader Chuck Schumer, a Democrat, said on April 23, before thanking House Speaker Mike Johnson, a Republican, for moving the legislation along.

The new legislation means that U.S. military supplies could be moved to Ukraine in a matter of days.

In early April 2024, Ukrainian President Volodymyr Zelenskyy laid out the stakes for the U.S. support saying, “If the Congress doesn’t help Ukraine, Ukraine will lose the war.” Russia had increased its bombing of Ukraine in recent months, and the battle lines between Russia and Ukraine have moved little in the past year.

Pressure increased on lawmakers to pass the aid package after Iran’s drone missile attack on Israel on April 14, 2024.

The U.S. has been the largest single donor backing Ukraine since Russian troops invaded the country in February 2022. Since then, the U.S. has sent Ukraine approximately $113 billion in a combination of cash, military supplies and machinery, as well as food and other humanitarian supplies.

As a scholar of Eastern Europe, I think there are a few important reasons why the U.S. has a lot at stake in supporting Ukraine.

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Republicans divided over Ukraine aid


Since February 2024, Johnson had delayed initiating a vote on the Ukraine foreign aid bill in the House of Representatives for a few reasons. One major factor was fighting between Republicans, who hold a slim majority in the House.

While some centrist Republican politicians supported Ukraine funding and pushed for a vote on the foreign aid package, others – hard-right Republicans – wanted a bill that prioritized what they said are American interests, meaning more of a focus on domestic U.S. problems.

Another issue was a threat of other Republicans trying to remove Johnson from his leadership role.

Rep. Thomas Massie of Kentucky called on Johnson to resign and joined Rep. Marjorie Taylor Greene of Georgia, a Republican who filed a motion on March 22, 2024, to prompt a vote that could push Johnson out of his House leadership position.

Eventually, Johnson reportedly settled on the idea that supporting the legislation was the right decision – and reached out to Democrats across the aisle to help him see the bills through.

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Delays on Ukraine benefit Putin


As the House was stalling on a vote, Ukraine was rationing ammunition and supplies. This, in turn, provided an opportunity for Russia to strengthen its arsenal.

Delays with foreign aid to Ukraine give Putin time to move forward with plans to purchase ballistic missiles from Iran. National Security Council spokesperson John Kirby expressed concerns in early January 2024 that Russia was close to acquiring short-range ballistic weapons from Iran.

Russia already buys drones from Iran and ballistic missiles from North Korea.

In February, U.S. national security adviser Jake Sullivan pointed out that Ukrainian forces lost a major center of resistance in the east of Ukraine called Avdiivka to Russia because of a shortage of ammunition.

Without foreign aid from the U.S., Ukraine faces a strategic disadvantage that could lead to Russia winning the war. That could lead to Russia increasing its threats on nearby NATO countries.

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The US needs Europe to compete with China


There are other reasons why many experts think it helps the U.S. to back Ukraine. One factor is U.S. global power competition with China.

Russian and Chinese leaders declared a military and political partnership days before Russia’s invasion of Ukraine in February 2022. They announced on April 9, 2024, that they want to find ways to strengthen their joint security work across Asia and Europe.

U.S. political and military leaders have noted that supporting Ukraine and pushing back against Russia is one clear way to deter China from strengthening its global political power and military reach.

Navy Adm. Samuel J. Paparo said in February 2024 that Russia’s potential loss in Ukraine is “a deterrence in the western Pacific and directly reassures partners.”

The admiral said that China is studying the Ukraine invasion for its own purposes, in order to “effect a short, sharp conflict that presents a fait accompli to all of the world.” He called for the U.S. to continue to fund Ukraine’s war.

The U.S. needs its long-standing allies in Europe to help push back against China – and deterrence is only as effective as the size of the force doing the deterring.

Ely Ratner, the U.S. assistant secretary of defense for Indo-Pacific security affairs, recently explained this principle and how it relates to China: “We believe deterrence is real and deterrence is strong, and we’re working every day to keep it that way.”

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Foreign aid benefits US arms industry


Most of America’s military aid to Ukraine consists of arms and ammunition from existing U.S. stockpiles. More than one-third of the $61 billion spending includes $23 billion dedicated to replenishing weapons and ammunition systems for the U.S. military.

In December 2023, Biden signed a U.S. defense policy bill that authorizes a record-high $886 billion in spending from July 2023 through June 2024. This includes a 5.2% pay raise for troops, $11.5 billion in support of initiatives to help deter China and $800 million to support Ukraine’s counteroffensive war.

But it also allows for the purchasing of new ships, aircraft and other types of ammunition. For defense stocks, that means a promising start to 2024, as the military will be likely to boost defense contractors’ revenues looking to restock supplies shipped to Ukraine.

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Americans continue to support Ukraine aid


A majority of Americans still favor U.S. support of Ukraine, though about half of Republicans said in December 2023 that the U.S. is giving too much money to the country.

Even though politicians do not always follow public opinion, there are clear reasons why it is in the U.S.’s best interests to keep funding Ukraine.

Are race-conscious scholarships on their way out?

April 26 ,2024

The fate of hundred of millions of dollars in scholarship money is up in the air in Ohio after seven state universities put race-conscious programs on hold to check their legality.
:  
By Jeffrey C. Sun
University of Louisville
and Charles J. Russo

University of Dayton

(THE CONVERSATION) — The fate of hundred of millions of dollars in scholarship money is up in the air in Ohio after seven state universities put race-conscious programs on hold to check their legality. The review comes after Dave Yost, the state’s attorney general, advised administrators in a call that using race as a factor to award funds may be unconstitutional.

Yost’s guidance was based on the U.S. Supreme Court’s June 2023 decision in Students for Fair Admissions v. Harvard, which banned consideration of a student’s race in college admissions, except under limited conditions.

Yost’s interpretation of the court’s opinion should not have been a surprise. The day after the Supreme Court’s decision, he had signaled that schools should clamp down on race-conscious programs. He warned that “disguised” race-conscious admissions policies are still race-conscious admissions policies.

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Targeting racial criteria


Although Ohio did not consider race-conscious scholarships right after the Supreme Court decision came down, other states acted quickly to place such scholarships on the chopping block. Missouri’s attorney general immediately banned the use of race in financial aid decisions. Officials at the universities of Kentucky and Missouri eliminated consideration of race in scholarships and grants.

This raises a question that goes beyond Ohio: Are scholarships that use race as part of their criteria a thing of the past? The short answer is “no.” But based on a review of the 2023 Supreme Court decision and other precedent, such programs will have to pass a tough judicial test. Even then, race can’t be the only factor.

Campus leaders have some guidance on what to do. In August 2023, for example, the federal departments of Justice and Education provided advice on how schools could keep a diverse student body without considering race in admissions decisions. Factors such as socioeconomic status, ZIP codes, high schools attended, academic achievements and demonstrated contributions to society could become more important in admissions decisions.

But the federal agencies were silent on how the court’s ruling would affect scholarships and financial aid. To figure that out, administrators may have to go back to the source: the 2023 Supreme Court decision.

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Diversity and the ‘strict scrutiny’ test


When the Supreme Court reviewed the admissions programs at Harvard and the University of North Carolina, it used a strict scrutiny standard, the highest level of legal review under the 14th Amendment’s equal protection clause. To pass muster, rules or laws that affect fundamental rights must serve a “compelling state interest” and be written to minimize their effect on such rights.

In 2003 and again in 2016, the court ruled that a diverse student body is a compelling interest. But in 2023, Harvard and UNC weren’t able to pass the strict scrutiny test. Both schools claimed their programs promoted diversity.

The court ruled that the universities’ race-conscious admissions programs involved racial stereotyping, lacked “sufficiently focused and measurable objectives warranting the use of race” and “unavoidably employ race in a negative manner.”

The programs violated both the equal protection clause of the Constitution and Title VI of the Civil Rights Act of 1964. Title VI bars discrimination based on race, color, or national origin in programs or activities that receive federal assistance, such as student loans and Pell Grants.

Some legal scholars, not unreasonably, say the court’s decision bans the use of race in awarding scholarships, as well as in admissions. But this overlooks two important facts: The Supreme Court did not rule that diversity can never be a compelling state interest or that race can never be considered.

True, the use of race in many programs receiving federal assistance is now restricted, but it has not been completely outlawed. Even race-conscious admissions aren’t completely off the table – if programs can pass the strict scrutiny test. Consideration of a student’s race might be allowed if there is “an exceedingly persuasive justification that is measurable and concrete enough to permit judicial review,” the court said.

For example, the Supreme Court OK’d race-based policies at U.S. military academies on the theory that a strong national defense – a compelling state interest – requires a diverse officer corps. But after the Harvard and UNC decision, even these programs will need to explore other ways to achieve diversity.

Strategies for diversity in admissions that don’t take race into account, like those suggested by the departments of Education and Justice, can serve as a guide for school administrators. MIT and Stanford Law are among the programs already using criteria such as income, ZIP code and civic engagement to maintain diversity.

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More challenges ahead


The use of race in scholarships and admissions is just one legal challenge race-conscious programs face. In July 2023, 13 state attorneys general – from Alabama, Arkansas, Indiana, Iowa, Kansas, Kentucky, Mississippi, Missouri, Montana, Nebraska, South Carolina, Tennessee and West Virginia – sent a letter urging Fortune 100 CEOs to eliminate all such programs at their companies.

Critics of these programs also questioned the use of race in scholarship and financial aid programs funded from outside a university, including fellowships that consider race when helping underserved students.

In contrast, some campus leaders and lawyers argue that the court’s decision should be limited to race-conscious admissions. They argue it should not include other programs where race might be used as a factor.

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Tips for prospective students and their parents


Students who want to improve their chances of obtaining scholarships can start by considering the list of permissible criteria for admissions decisions and follow up with their own research. Students can also take the following steps:

• Stay informed: Follow the news to find out whether changes in state laws or policies will affect scholarship opportunities.

• Talk to financial aid administrators: Connect with advisers in the school’s financial aid office to learn how they interpret the Harvard/UNC decision.

• Don’t rely exclusively on financial aid from the college: Investigate and apply for scholarships and financial aid that are not administered by a college. The Supreme Court decision applies only to institutions that receive public funds.

Supreme Court appears open to Starbucks’ claims in labor-organizing case

April 25 ,2024

What factors must a court consider when the National Labor Relations Board requests an order requiring an employer to rehire terminated workers before the completion of unfair labor practice proceedings?
:  
Michael Z. Green, Texas A&M University

(THE CONVERSATION) — What factors must a court consider when the National Labor Relations Board requests an order requiring an employer to rehire terminated workers before the completion of unfair labor practice proceedings?

That’s the central question that the Supreme Court considered on April 23, 2024, during oral arguments in the Starbucks Corp. v. McKinney case. The global coffee shop chain is challenging the NLRB, the federal agency responsible for enforcing U.S. workers’ rights to organize, saying that the agency used the more labor-friendly of two available standards when it asked a federal court to order the company to reinstate workers at a Memphis, Tennessee, store who lost their jobs in 2022 amid a nationwide unionizing campaign.

The Conversation U.S. asked Texas A&M law professor Michael Z. Green to explain what’s behind this case and how the court’s eventual decision, expected by the end of June, could affect the right to organize unions in the United States.

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What is this case about?


Seven baristas who were attempting to organize a union at a Starbucks shop in Memphis, Tennessee, were fired in February 2022. Starbucks justified their dismissal by asserting that the employees, sometimes called the “Memphis 7,” had broken company rules by reopening their store after closing time and inviting people who weren’t employees, including a television crew, to go inside.

In June of that year, the shop became one of more than 400 Starbucks locations since 2021 that have voted in favor of joining Workers United, an affiliate of the Service Employees International Union.

While a complaint over the mass dismissal was pending with the NLRB, Kathleen McKinney, the NLRB director for the region that includes Memphis, sought an injunction in a federal district court to force Starbucks to give the Memphis 7 their jobs back while the case proceeded. The company must “cease its unlawful conduct immediately so that all Starbucks workers can fully and freely exercise their labor rights,” she said.

By August 2022, a judge had ordered Starbucks to do that, and in September the baristas were back on staff.

Although the seven baristas got their jobs back and the union vote prevailed, the company has appealed the case all the way to the Supreme Court because it believes the court should not have ordered the company to reinstate the workers while NLRB proceedings were still pending.

But the NLRB argues, and the lower courts agreed, that the terminations chilled further union activities at the store even after the election.

Nevertheless, Starbucks argues that firing the seven workers had no effect because employees at that coffeehouse still voted in favor of unionization.

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What’s being challenged?


The justices will have to decide which approach federal courts should use when they consider requests for injunctions like this one.

Currently, five appeals courts, including the one where this case arose, base their decision on a two-part test.

First, the courts determine whether there is “reasonable cause” to believe an unfair labor practice has occurred. Second, they determine whether granting an injunction would be “just and proper.”

Four other appeals courts use a four-part test.

First, the courts ask whether the unfair labor practice case is likely to succeed on the merits in establishing that labor violations occurred. Second, they look to see if the workers the NLRB is attempting to protect will face irreparable harm without an injunction. Third, after showing likelihood of success and irreparable harm, they ask whether those factors outweigh any hardships the employer is likely to face due to compliance with the court’s order. Fourth, they ask whether issuing the injunction serves the public interest.

Two other appeals courts use a hybrid test that appears to have components of both of the tests. They ask whether issuing an injunction would be “just and proper” by considering the elements of the four-part test.

In its Supreme Court brief, Starbucks argues that having to give workers their jobs back in these circumstances can cause “irreparable injury” and that it’s an “extraordinary remedy.”

The NLRB, in its Supreme Court brief, says that the injunction was proper in this case because Starbucks terminated 80% of the union organizing committee at the Memphis store and the evidence showed the chilling effect this action had on the “lone remaining union activist.” According to the NLRB, this chilling effect “harmed the union campaign in ways that a subsequent Board ruling could not repair.”

A labor reporter discussing Starbucks’ unfair labor practice cases, including the one involving the Memphis 7, determined that NLRB administrative law judges had found labor violations in 48 out of 49 cases.

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What’s the potential impact of the court’s eventual ruling on this case?


While the case may sound like it’s only about seven people employed at a single coffee shop, the scope is wider than that.

Although the NLRB issues hundreds of unfair labor practice complaints against employers every year, it usually doesn’t turn to the courts to force the rehiring of employees. It only sought these types of injunctions 17 times in 2023, for example.

And seven of those efforts involved Starbucks. Despite the small number of overall injunctions, the large number of unfair labor practice complaints – and the eventual 48 out of 49 findings of violations – might support the rare use of injunctions in this case.

If the Supreme Court rules in favor of Starbucks, the overall impact seems unclear.

For one thing, the court will have picked one test over another without any proof that one is more likely to result in an injunction or not. In addition, the underlying unfair labor practice case has been resolved, since the workers have gotten their jobs back and their workplace has joined a union.

What’s more, Starbucks has agreed to negotiate collective bargaining agreements with the union, which has continued to make inroads at the company’s coffee shops.

Because the NLRB rarely seeks injunctions, the fact that this issue has obtained enough importance for consideration by the Supreme Court seems odd considering its valuable time and the limited number of cases it can consider each year. But let’s see what the court’s majority decides.

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What do you expect based on the justices’ questions during oral arguments?


You can’t always tell where justices are heading by their questions alone.

But, based on the questions asked and the justices who asked them, I anticipate that a majority will rule in favor of Starbucks by saying that all district courts must rely on a four-part test in these instances.

Whether that would make it harder for union organizers to preemptively get their jobs back in cases like this isn’t clear. But it’s at least theoretically possible if this ruling provides new guidance on how courts should apply that four-part test when the NLRB asks for an injunction.