After federal authorities raided seven chicken processing facilities in Mississippi last week evidence is now surfacing (within probable cause affidavits – full pdf below) of willful and intentional illegal hiring practices.  But don’t look for all the employers to be prosecuted.

The Washington Post has an excellent outline of the seven facilities citing dozens of instances where evidence shows each company knew they were hiring people who were not legally eligible for work.

In a surprising number of cases the illegal employees were arrested by Border Patrol in California, Texas, New Mexico and Arizona and released on electronic-monitoring programs, including ankle bracelets, to await court dates.

According to the affidavits federal authorities tracked the GPS locators on some of the employees and found they were illegally working in all of the facilities.  During interviews with the workers they stated how friends and family members in Mexico and Guatemala told them where to go for work in Mississippi.

Apparently the ability to gain illegal employment at the Mississippi facilities, and specifically where to go to get hired, was widely known throughout the home communities of the migrants.  After they were detained at the U.S. border, they were processed, received monitors, allowed to leave, and then immediately went to Mississippi to begin work.

They were not allowed to work legally in the United States while wearing the ankle-bracelets and monitored.  However, they just went to the chicken plants because that was all just part of the anticipated program.

The hiring examples include the customary use of multiple aliases, forged paperwork and ID’s, and using social security numbers of deceased people.

The Washington Post article is really quite remarkable:  SEE HERE.

[Excerpt] … The records detail how ICE linked undocumented immigrants to the companies. Investigators found some employees via GPS coordinates at plants operated by all five companies. The employees previously had been arrested by Border Patrol agents in California, Texas, New Mexico and Arizona and released on electronic-monitoring programs, including ankle bracelets, to await court dates. In each case cited, the individuals listed addresses in small towns in central Mississippi where they could be located.

An undocumented Mexican woman working in a Peco Foods plant in Bay Springs, Miss., told immigration officials that she had come to the state because people in Mexico had told her that jobs were available at the chicken plants there.

In cases cited in the affidavits, people on ICE’s electronic-monitoring programs were not authorized to work. But according to the affidavits, dozens of employees in such programs were found working at the seven chicken plants in 2018 and 2019. One successful job applicant was told by a supervisor during her interview that she would need to keep her ankle monitor charged while she worked. (read more)

Now, at first review it might sound like the plant employers would be in big trouble; however, buried deep in the article is this statement from one of the employers (Koch Foods), that everyone should pay attention to:

Koch spokesman Jim Gilliland told The Post that Koch Foods risked violating federal law that bans discrimination on the basis of national origin for requesting documents beyond what an applicant provides, if those materials appear authentic.

I can tell you with 100% certainty that what Mr. Gilliland says there is absolutely accurate.  There are two sets of laws in conflict with each-other; and you can be sued, and/or fined, by the United States Department of Labor and/or the U.S. DOJ Civil Rights Division for not hiring illegal aliens.

If you question the authenticity of any applicants identity; and that applicant is one of a legally protected category (think “ethnicity” or “origin”); and the employers authenticity challenge results in a “disparate impact” of non-eligibility for employment – as determined by ethnicity (Latino); then you are in violation of U.S. labor laws.  This happens regardless of it being unlawful to hire illegal aliens.

If you challenge the presented documents, and all the outcomes of those challenges result in non-eligibility of Hispanics as a greater percentage than non-Hispanics, you are violating employment law under the DOJ (Civil Rights Division) definition of “disparate impact.”   In this example, and it is common (believe me), additional employment eligibility checks due to suspicions of false ID’s, is unlawful and legally risky.

It’s also completely stupid.

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If you needed any empirical evidence to prove the doomsday proclamations by the financial pundits are false claims, just look at the July consumer spending results. July spending more than doubled expectations.

July results were +0.7 percent, against the economic forecast of +.03 percent.   Consumer spending makes up over two-thirds of the U.S. GDP and overall economy. Doesn’t exactly sound like Main Street is on the precipice of a recession. Oh my.

Average wage growth remains +3.5% year-over-year.  The growth of overall income for American workers exceeds +5.4 percent year-over-year.  Unemployment is a low 3.6%and U.S. consumer inflation remains low at 1.4 percent.  Meaning: the middle-class has more disposable income to save or SPEND; and that’s what is happening….

• Reminder #1: Consumer spending is two-thirds of the U.S. economy.
• Reminder #2: We consume more than 80 percent of our own production (products created in USA).  We do not rely on exports.
• Reminder #3: Because of #1 and #2, the “Main Street” U.S. economy is self sustaining -much stronger- and more protected from the negative impacts on the global economy.
• Reminder #4: Who/What is at risk from global contraction? The Wall Street economy (compromised primarily of multinationals).  What is not at risk, the Main St economy.
• Reminder #5:  Because of #3 and #4, Wall Street can drop while Main Street thrives.

This is the fundamental disconnect. These Main Street results, this dynamic, is the space between two economic engines that CTH has been describing for three years.  The investment class on Wall Street can go through pain, while the middle-class on Main Street thrive.  We are in the space between.

Wall Street Journal: WASHINGTON—American shoppers gave the U.S. economy a solid boost in July, a counter to weakness in the manufacturing sector and Wall Street jitters about faltering growth.

Retail sales, a measure of purchases at stores, restaurants and online, climbed a seasonally adjusted 0.7% in July from a month earlier, the Commerce Department said Thursday.

White House trade and manufacturing policy advisor Peter Navarro appears on Fox News to discuss the status of the U.S-China trade negotiations and the reason for a USTR delay on some product tariffs.

Peter Navarro confirms what we noted from the office of USTR Robert Lighthizer yesterday.  On December 15th “the tariffs will go on.”   While the statement flies over the head of Stuart Varney, Navarro confirms the “next step” process that Lighthizer implied.

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More below

The U.S. stock market continues reacting to an unusual dynamic. 50% of all companies manufacturing in China are U.S. owned multinational corporations. Those companies don’t want tariffs to succeed in disrupting their supply chain. As a consequence those Wall St. Corps also don’t want lower U.S. Fed interest rates designed to combat China’s currency devaluation.

Normally Wall St. would like lower rates (cheap money), but in this dynamic the U.S. multinationals are against it. Wall Street is schizophrenic. Domestic U.S. companies benefit from the lower rates; however, now, lower rates are adverse to the interests of the multinational companies.

It was Albert Einstein who aptly stated:

“The significant problems we have cannot be solved at the same level of thinking with which we created them.”

The same basic principle applies to those who are trying to understand and evaluate current economic activity yet failing to disengage themselves from their historic economic frames of reference.

Minds who are framed around thirty years of financial/monetary political policy; intended to influence the U.S. economy and created by vested interests who were building out the legislative priorities based on Wall Streets’ best interests; will struggle to understand the new landscape which is entirely formulated to benefit Main Street.

There are two economic engines: Wall Street and Main Street.

The two economic engines are divergent and detached. Time (30+ years), along with monetary focus only on Wall Street interests (multinationals), pushed those two economic engines further apart. The same monetary policies which worked in the immediate past will not work in the immediate future.

We are now in the economic space between both engines. The traditional cause and effect (Fed) is now uncoupled.  The administrators of the economy are perplexed; this is unfamiliar terrain.

The exact same areas of the country which have gone through three decades of economic contraction are now seeing economic expansion and revitalization. The Fed policy which influences Wall Street was not, and is not, domestic centric. The fed policy was corporate driven monetary policy and globalist in influence.

Until the two economies gain parity in value – any fed activity, taken as a consequence to their familiar traditional measurements (interest rates etc.), will have minimal to negligible impact on Main Street.