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Why We Need Stronger Unions, and How to Get Them
Why is this recession so deep, and what can be done to reverse it?
Hint: Go back about 50 years, when America's middle class was expanding and the economy was soaring. Paychecks were big enough to allow us to buy all the goods and services we produced. It was a virtuous circle. Good pay meant more purchases, and more purchases meant more jobs.
At the center of this virtuous circle were unions. In 1955, more than a third of working Americans belonged to one. Unions gave them the bargaining leverage they needed to get the paychecks that kept the economy going. So many Americans were unionized that wage agreements spilled over to nonunionized workplaces as well. Employers knew they had to match union wages to compete for workers and to recruit the best ones. Fast forward to a new century. Now, fewer than 8% of private-sector workers are unionized. Corporate opponents argue that Americans no longer want unions. But public opinion surveys, such as a comprehensive poll that Peter D. Hart Research Associates conducted in 2006, suggest that a majority of workers would like to have a union to bargain for better wages, benefits and working conditions. So there must be some other reason for this dramatic decline. But put that question aside for a moment. One point is clear: Smaller numbers of unionized workers mean less bargaining power, and less bargaining power results in lower wages.
It's no wonder middle-class incomes were dropping even before the recession. As our economy grew between 2001 and the start of 2007, most Americans didn't share in the prosperity. By the time the recession began last year, according to an Economic Policy Institute study, the median income of households headed by those under age 65 was below what it was in 2000.Typical families kept buying only by going into debt. This was possible as long as the housing bubble expanded. Home-equity loans and refinancing made up for declining paychecks.
But that's over. American families no longer have the purchasing power to keep the economy going. Lower paychecks, or no paychecks at all, mean fewer purchases, and fewer purchases mean fewer jobs.
The way to get the economy back on track is to boost the purchasing power of the middle class. One major way to do this is to expand the percentage of working Americans in unions. Tax rebates won't work because they don't permanently raise wages. Most families used the rebate last year to pay off debt -- not a bad thing, but it doesn't keep the virtuous circle running. Bank bailouts won't work either. Businesses won't borrow to expand without consumers to buy their goods and services. And Americans themselves can't borrow when they're losing their jobs and their incomes are dropping.
Tax cuts for working families, as President Obama intends, can do more to help because they extend over time. But only higher wages and benefits for the middle class will have a lasting effect.
Unions matter in this equation. According to the Department of Labor, workers in unions earn 30% higher wages -- taking home $863 a week, compared with $663 for the typical nonunion worker -- and are 59% more likely to have employer-provided health insurance than their nonunion counterparts.
Examples abound. In 2007, nearly 12,000 janitors in Providence, R.I., New Hampshire and Boston, represented by the Service Employees International Union, won a contract that raised their wages to $16 an hour, guaranteed more work hours and provided family health insurance. In an industry typically staffed by part-time workers with a high turnover rate, a union contract provided janitors with full-time, sustainable jobs that they could count on to raise their families' -- and their communities' -- standard of living.
In August, 65,000 Verizon workers, represented by the Communications Workers of America, won wage increases totaling nearly 11% and converted temporary jobs to full-time status. Not only did the settlement preserve fully paid healthcare premiums for all active and retired unionized employees, but Verizon also agreed to provide $2 million a year to fund a collaborative campaign with its unions to achieve meaningful national healthcare reform.
Although America and its economy need unions, it's become nearly impossible for employees to form one. The Hart poll I cited tells us that 57 million workers would want to be in a union if they could have one. But those who try to form a union, according to researchers at MIT, have only about a 1 in 5 chance of successfully doing so.
The reason? Most of the time, employees who want to form a union are threatened and intimidated by their employers. And all too often, if they don't heed the warnings, they're fired, even though that's illegal. I saw this when I was secretary of Labor over a decade ago. We tried to penalize employers that broke the law, but the fines are minuscule. Too many employers consider them a cost of doing business.
This isn't right. The most important feature of the Employee Free Choice Act, which will be considered by the just-seated 111th Congress, toughens penalties against companies that violate their workers' rights. The sooner it's enacted, the better -- for U.S. workers and for the U.S. economy.
The American middle class isn't looking for a bailout or a handout. Most people just want a chance to share in the success of the companies they help to prosper. Making it easier for all Americans to form unions would give the middle class the bargaining power it needs for better wages and benefits. And a strong and prosperous middle class is necessary if our economy is to succeed.
Hint: Go back about 50 years, when America's middle class was expanding and the economy was soaring. Paychecks were big enough to allow us to buy all the goods and services we produced. It was a virtuous circle. Good pay meant more purchases, and more purchases meant more jobs.
At the center of this virtuous circle were unions. In 1955, more than a third of working Americans belonged to one. Unions gave them the bargaining leverage they needed to get the paychecks that kept the economy going. So many Americans were unionized that wage agreements spilled over to nonunionized workplaces as well. Employers knew they had to match union wages to compete for workers and to recruit the best ones. Fast forward to a new century. Now, fewer than 8% of private-sector workers are unionized. Corporate opponents argue that Americans no longer want unions. But public opinion surveys, such as a comprehensive poll that Peter D. Hart Research Associates conducted in 2006, suggest that a majority of workers would like to have a union to bargain for better wages, benefits and working conditions. So there must be some other reason for this dramatic decline. But put that question aside for a moment. One point is clear: Smaller numbers of unionized workers mean less bargaining power, and less bargaining power results in lower wages.
It's no wonder middle-class incomes were dropping even before the recession. As our economy grew between 2001 and the start of 2007, most Americans didn't share in the prosperity. By the time the recession began last year, according to an Economic Policy Institute study, the median income of households headed by those under age 65 was below what it was in 2000.Typical families kept buying only by going into debt. This was possible as long as the housing bubble expanded. Home-equity loans and refinancing made up for declining paychecks.
But that's over. American families no longer have the purchasing power to keep the economy going. Lower paychecks, or no paychecks at all, mean fewer purchases, and fewer purchases mean fewer jobs.
The way to get the economy back on track is to boost the purchasing power of the middle class. One major way to do this is to expand the percentage of working Americans in unions. Tax rebates won't work because they don't permanently raise wages. Most families used the rebate last year to pay off debt -- not a bad thing, but it doesn't keep the virtuous circle running. Bank bailouts won't work either. Businesses won't borrow to expand without consumers to buy their goods and services. And Americans themselves can't borrow when they're losing their jobs and their incomes are dropping.
Tax cuts for working families, as President Obama intends, can do more to help because they extend over time. But only higher wages and benefits for the middle class will have a lasting effect.
Unions matter in this equation. According to the Department of Labor, workers in unions earn 30% higher wages -- taking home $863 a week, compared with $663 for the typical nonunion worker -- and are 59% more likely to have employer-provided health insurance than their nonunion counterparts.
Examples abound. In 2007, nearly 12,000 janitors in Providence, R.I., New Hampshire and Boston, represented by the Service Employees International Union, won a contract that raised their wages to $16 an hour, guaranteed more work hours and provided family health insurance. In an industry typically staffed by part-time workers with a high turnover rate, a union contract provided janitors with full-time, sustainable jobs that they could count on to raise their families' -- and their communities' -- standard of living.
In August, 65,000 Verizon workers, represented by the Communications Workers of America, won wage increases totaling nearly 11% and converted temporary jobs to full-time status. Not only did the settlement preserve fully paid healthcare premiums for all active and retired unionized employees, but Verizon also agreed to provide $2 million a year to fund a collaborative campaign with its unions to achieve meaningful national healthcare reform.
Although America and its economy need unions, it's become nearly impossible for employees to form one. The Hart poll I cited tells us that 57 million workers would want to be in a union if they could have one. But those who try to form a union, according to researchers at MIT, have only about a 1 in 5 chance of successfully doing so.
The reason? Most of the time, employees who want to form a union are threatened and intimidated by their employers. And all too often, if they don't heed the warnings, they're fired, even though that's illegal. I saw this when I was secretary of Labor over a decade ago. We tried to penalize employers that broke the law, but the fines are minuscule. Too many employers consider them a cost of doing business.
This isn't right. The most important feature of the Employee Free Choice Act, which will be considered by the just-seated 111th Congress, toughens penalties against companies that violate their workers' rights. The sooner it's enacted, the better -- for U.S. workers and for the U.S. economy.
The American middle class isn't looking for a bailout or a handout. Most people just want a chance to share in the success of the companies they help to prosper. Making it easier for all Americans to form unions would give the middle class the bargaining power it needs for better wages and benefits. And a strong and prosperous middle class is necessary if our economy is to succeed.
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Everything you say here makes perfect sense. After reading this, I wonder why I haven't seen it put so succinctly many times over.
Interesting article including audio tape from a phone call about the Labor Bill at Huffpo's "Bailout Execs Plot Against Labor Bill": http://www.huffingtonpost.com/2009/01/27/bank-of-america-hosted-an_n_161248.html
January 27, 2009 10:50 PM | Reply | Permalink
Yes, yes, YES! Unions are the cornerstone of a thriving middle class.
Dr. Reich, you didn't mention the provisions of Taft-Hartley that allow states to ban closed shops (in so-called "right to work" states), but repealing those parts of T-H would go a long way to getting Southern workers into unions.
Bonus: Unionizing the South (which is where most of the "right to work" states are) it would get Southern working-class voters voting for the Democrats, reliably, every single election.
Imagine grateful Alabamans, Georgians, Mississippians all voting gratefully for the party that helped them organize and improve their lot in life.
January 27, 2009 10:54 PM | Reply | Permalink
In theory this is great, but in reality unions have stymied advancement for capable individuals and foster mediocrity in the ranks. There are some industries - teachers, for example - that should NOT be unionized.
I'm in a fight with my union right now. Problem? I want a raise. My boss wants to give me a merit raise. I have a job description that is a little different from the other union employees and industry-wide this job is usually paid more than I'm getting. But the union won't approve it because then EVERYONE would have to get a (more than the cost of living) raise. So, I asked if my position could be re-classified as non-union. Nope. They can't lose membership. This, despite the fact that even though they garnish my wages every month for dues, I don't pay the extra amount they ask for so I can't even vote, thus I'm really just a number, not a member.
Other friends have been offered promotions that they can't take because the union won't release them until a replacement is hired, but management won't hire someone until the position is actually vacant. So, all the management jobs are filled from the outside. Fun!
My students wanted to get their work room painted. It's not a large room, but it hasn't been painted in 15 years. I asked my boss if we could, and he asked us to get an estimate first. Now this is not a huge room - we could do two coats with a gallon and a half of paint. Union estimate? $2500 and two weeks. When I asked if they got much business on campus, they said, (not surprisingly) no, but if we tried to paint it ourselves there would be fines and punishment because that would be taking food from "their children's mouths." I told him their pricing took food from their children's mouths, but he just said, "don't paint yourself."
Then there are teachers unions which allow lazy, mediocre (sometimes) abusive teachers to retain tenure at the expense of good education.
Unions are a great idea for some industries and yes, they have done great work for wages, but they are not a universal solution.
January 28, 2009 8:46 AM | Reply | Permalink
This is apparently not the case with you, but it is a standard anti-union tactic to argue particular cases where unions don’t perform very well or get in the way, and ignore the ruth that a well-unionized labor force is over all a very good thing for a labor force.
It sounds, by the way, that you need to shake up your local – have you considered running to lead it?
January 28, 2009 5:50 PM | Reply | Permalink
Well, you didn't really respond to any of my particular complaints, and I'm not just talking about one union. We have at least a half-dozen on our campus and they all function to obstruct work and drive up prices rather than produce it.
And, no, I have no desire to run our lousy local. I have a job. All I want is to do this job at the salary I could earn at nearly any other university in the country. My union, unapologetically, makes this impossible.
Initially, unions actually did useful things for workers, but these days all they serve to do is protect themselves and drive up prices. I'm not saying that some workers don't experience needed protection when unionized, I just don't think that unions are the silver bullet this over-generalized blog post makes them out to be.
January 28, 2009 9:12 PM | Reply | Permalink
In a recent post I proposed, tongue somewhat in cheek, that Wal*Mart could provide significant economic stimulus by unilaterally raising to $16 per hour the average wage paid to its 1.4 million workers. You have made the point directly and much more forcefully.
The erosion of middle class wages, even as productivity continues to increase, points to the astonishing inability of American business to take the long view on an issue of critical importance to its own economic health. An economy that generates over two-thirds of its GDP from consumer spending cannot be sustained with the purchasing power of 100 million households in terminal decline.
The day employers see this on their own is the day unions will lose their relevance. Clearly that day has yet to arrive.
January 27, 2009 11:15 PM | Reply | Permalink
I have seen you make this point before and it makes perfect sense.
For a variety of reasons, we have seen union membership fall from it's highest of 30 percent or so to now. As both a former union carpenter and the son of a retired union tinner, one of those reasons is that power corrupts, despite good intention.
Organizational dynamics makes two very damaging realities inevitable in the union framework - pursuit of self interest and isolation from other industries. I am actually surprised the unions didn't band together across industries and try to get these rights for everyone at the federal level, fixing most of our current problems a long time ago.
Pensions and health care and pay equity and a living wage would have all made America more competitive on our now global playing field. We wouldn't still be having this conversation if unions had either evolved to meet our changing demands or succeeded at putting their common sense solutions into federal law.
There are many industries with no unions that enjoy steady and growing wages as well as killer benefits. What are they doing right? Perhaps their looser associations focused on advocacy at the federal level is a more affective tactic?
I'll give Unions a lot of credit for having taken the American worker as far as they did for their first 100 years, but calling for more unions is like calling for more cow bell.
January 28, 2009 7:47 AM | Reply | Permalink
You've prompted me to refine "relevance." You're also correct that it is probably inaccurate to a blanket statement about the failure of industries to take a long view.
The BMW plant in Spartanburg, S.C. is a good example. Wages are lower than UAW scale, but not dramatically so, and certainly competitive regionally. I don't know much about the benefits package, but based on what I've heard it is also competitive. Jobs there are much sought after and turnover is low. Even with EFCA, I foresee no real effort to unionize the plant. I'm almost certain any such effort would fail.
I share your view that unions will have to evolve to properly and fully serve their members in a employment marketplace that has radically changed. My sense is this evolution is underway.
Even fully loaded with caveats, I think the broader issue still stands. Regardless of whether unions are the solution or part of it, our economy will not prosper long if the middle class continues to see its standard of living and opportunity erode.
January 28, 2009 11:11 AM | Reply | Permalink
No doubt. That's why I advocate for more permanent and systemic solutions than unions have seen fit to offer or deliver.
I suspect they will emerge from the changing dynamic as a more typical member-based association pushing for change in their individual silos vice worrying about big ticket items like health care, pensions and salaries.
Timely discussion to be having, though, as it will be key to building a secure floor under the middle class that is much more effective than the "safety net" we've settled for up to now.
January 28, 2009 11:55 AM | Reply | Permalink
I'd distinguish associations that lobby on behalf of their members from unions that attempt to achieve specific objectives through collective bargaining. But I don't want to distract from your larger point, which I intend to consider further. Thanks.
January 28, 2009 12:35 PM | Reply | Permalink
That is the distinction between the two types of organizations today.
However, once unions no longer need to collectively bargain for individual concessions because we institute systemic solutions, I suspect they will become more like trade associations are today. Or, they will simply go away as a vestigial appendage to our body politic when special interests are finally subsumed and trumped by the common interest.
Either outcome is fine by me.
January 28, 2009 12:56 PM | Reply | Permalink
We're in perfect agreement, Jason.
January 28, 2009 1:01 PM | Reply | Permalink
This presentation is necessary for me so that I can have better documentation for a position I have held all my life.
Whatever happened to:
LOOK FOR THE UNION LABEL
Now its
LOOK FOR THE CHINESE LABEL
Right to work laws. Ha.
Like w's Clean Air Act.
Subterfuge.
I am trying to keep up with your fine presentations, as well as Dr. Kruger's. Some bloggers here have cited links to progressive economic sites and periodicals.
Very helpful to have your writings reproduced here.
January 28, 2009 12:54 AM | Reply | Permalink
Great post!
I've been thinking recently about the effects of increased globalization on Unions. Unions need to look at globalizing themselves to counter a "lowest common denominator" effect of unfairly cheaper outsourced labour.
January 28, 2009 1:44 AM | Reply | Permalink
You're exactly right about this Prof. Reich and I can attest to the antiunion lawlessness of businesses. I passed out a union organizing pamphlet in a copper wire factory I worked in. I slipped it into everyone's locker while no one was around and I was supposedly going for a bathroom break. I only put the pamphlet in the day shift lockers and not the night shift which is what I worked. We worked three days on/three days off and 12 hours every day or in my case night (7 pm-7am). The night I dropped the leaflet was our last night and then we had three days off. Within 48 hours 5 guys were fired on the day shift because they were suspected to be part of the "secret' union organizing committee. The company made sure everyone knew exactly why these guys were fired. 3 of the guys were involved, but they didn't drop the fliers. I did. I always kept my mouth shut so was never a 'suspect" but had I been I would have been instantly fired. Once you're fired you can try and complain and go before some labor board but the deck is stacked against you, the process takes years on end and is expensive and on top of that, even if you win it doesn't matter to the employer because there is little or no real price to be paid for violating the rights of workers like that and maintaining and atmostphere of fear and intimidation. I quite two months later after being injured and figuring it just wasn't worth it.
Without unions, workers in this country (white and bluee collar alike) wouldn't have squat and we've been losing ground ever since the business world gained the upper hand and began systematically destroying unions whenever possible. Time to rewrite the laws and favor the workers so we don't have to have a repeat of the killing and violence that workers had to go throug in the 30's.
January 28, 2009 2:05 AM | Reply | Permalink
Thanks
January 28, 2009 4:14 AM | Reply | Permalink
Robert,
This is reflective of the bigger picture where fundamental constitutional protections have been eroded and infringed upon. Our congress and government in general is thoroughly conflicted in this regard. Corporate America has grown way too powerful to have a different outcome and until this is recognized and resolved nothing will change. Only one in ten Americans is truly represented under the current scheme. Until congress is isolated from the influence of corporate America the nine out of ten Americans who are not represented will remain a fact of life. Most Americans are not old enough to recognize how this has changed over the last fifty years and Americans very much need to be made aware of how the governance of our country has altered over that time. Virtually everything we have had happen over the years is a result of government having failed to contemplate and act upon what is good for the majority. You just cannot understate how our formula of governance has changed. And this is no accident.
January 28, 2009 2:07 AM | Reply | Permalink
Any news on Solis for Labor sec?
These discussions tend to make me think about paradoxes that go unmentioned. They include the question of how all could be owners of businesses in a modern civilization. Clearly some have to be labor, or there would be no manufactured goods, only artisans making custom items for nobility.
Another question is whence the reflexive disdain for tariffs. Who has ever been helped by free trade? The importers, of course. Not having any involvement in production, importing companies have modest employee rolls, and require little skill from them. Who is hurt? All indigenous trade and skilled labor.
Unions are as legitimate as the spreading of ownership across shareholders, and the diffusion of responsibility into the vague entity called a corporation. But unlike the latter, the union members are wholly public, and each exerts exactly one vote at meetings or when approving a contract or strike.
While it is irksome to be required to join a union, it is no better to be unable to enjoy wholesale discounts, or even hold a purchasing account with a company, if you are not another business. But it is the way businesses are run, and not illegal.
Consider that many businesses require stringent restrictions like non-disclosure and non-compete from prospective hires. They may also require various paycheck deductions for this or that. Why having to pay union dues to an organization that will defend the worker bothers that worker is not clear. It may be due to the propaganda put out by owners, such as Mr. Reich's mention of corporations claiming "Americans don't like unions." Why such biased sources should be heard at all is another paradox.
January 28, 2009 2:19 AM | Reply | Permalink
Your comment is succinct and broad in its' content, (as usual), Tom. Regarding "Why such biased sources should be heard at all is another paradox", I would suggest that those sources are one and the same, (in fact or by proxy, vis a vis advertising revenue), as the media outlets who convey the message to us.
January 28, 2009 2:46 AM | Reply | Permalink
Dunno. EFCA looks like it is an attack on businesses. It's just a stick. Where's the carrot? It shifts the balance of power slightly to those who would agitate for unionization, while raising fears of unfairness to workers. It trades stories of intimidation by employers for stories of intimidation by zealous unionizers.
I favor the right to unionize. And I believe that treating labor like a commodity is wrong outside of academic exercises; workers are people, neither cattle nor chattel. I also believe that excess concentration of wealth, and excess concentration of net income, is a problem for society and is a genuine player in our recent history. But I don't know the actual cash flows for various wage-based labor industries - if the rich are getting richer while workers in real terms are barely holding their own, where is that coming from? How much of that occurs in publicly traded companies, privately held companies, small or medium sized businesses, etc?
It seems odd to call for upward pressure on wages when we have a huge trade deficit largely due to lower labor costs abroad, and are entering a recession which will be hard on many businesses. This trade deficit seems more likely the major cause of wage weakness over the past 8 years, than some fine points of union formation. It's not right to point to post credit bubble or post housing bubble effects on individuals who speculated or borrowed excessively, as a reason to support this bill.
I don't know the truth behind why so few workers (8%) in non-government business are in unions, nor do I know how many of them truly want whatever union affiliation might be available. It seems that some auto plants have managed to not have unions by paying close to union wages. And unionized auto companies are having a very hard time, not that it's only the fault of higher pay and benefits which come with a union.
January 28, 2009 2:51 AM | Reply | Permalink
Imagine there were no other countries, no foreign markets to sell to, or to buy from. (We'll ignore raw materials for now.) Why should it be impossible to make cars or tractors, or to grow food and deliver medical care, at a living wage for the worker? Given that until fairly recently, the vast majority of manufactured goods we used were made here it is of course entirely reasonable to imagine.
What changed? Reduced import tariffs, for one, which exposed American manufacturers and workers to imports that did not reflect meaningful pricing. By this I mean the apparent lower cost was more of an accounting trick than a physical truth. It takes the same energy inputs, materials, and labor, (often rather more labor), to make those jeans in Thailand, or that car in Korea. It is only an artifact of currency exchange and standard-of-living differences that yield the profit.
Since profit is supposed to reflect actual efficiencies, doing something better and with less waste, this is not really profit, but a cheat. Cheap imports are like invasive species, kudzu, that lack adapted competition. They are successful only in the short term
But there is a deeper problem, in that chasing maximal efficiency (even if it were real) makes the system brittle, with no forgiveness. In evolution, the maximally adapted species are the first to go when conditions change. Less-than-perfect adaptation is better for surviving and evolving.
January 28, 2009 4:04 AM | Reply | Permalink
Tom, it's late here so maybe that's why your interesting post doesn't seem to have a topical point. Could you summarize the point?
If a cheap labor pool opens up, or a manufacturing efficiency improvement suddenly hits part of an industry, that tends to increase profits for those who have access and it tends to decrease consumer prices overall. That's pressure towards efficiency. And it's downward pressure on wages in the old labor pool, while upward mobility occurs in the new pool (same as upward pressure on wages in the pool). How is it a cheat?
And you started out by talking about ignoring non-domestic, but almost instantly went back to including it, so that's muddled too. ??
No question that rich people who started factories where labor is $1/day vs. $200/day here (roughly) can reap great profits and probably drive local labor use out of business.
How are our times different from 1929-1930 in re tariffs?
January 28, 2009 4:13 AM | Reply | Permalink
I was sort of answering your question about trying to lift wages in a recession. Guess I failed.
You're not convincing me you do accept unions if you trot out ridiculous numbers like 1$ vs 200$. You either throw in too many costs in the latter or ignore costs in the former.
January 28, 2009 5:26 AM | Reply | Permalink
$25/hrx8hr = $200/day.
I'm not talking about the whole picture, and you're copping out.
January 28, 2009 5:39 AM | Reply | Permalink
Point to you, I missed the per-day for the $200.
But how is it not some kind of cheat to have someone receive one dollar for a work that adds up to hundreds' worth? Please address my imaginary example of what-if there were no Sri Lankas to make our jeans.
Remember patching jeans? How am I better off now that the jeans are a bit cheaper, but there are few decent-paying jobs here? I admire and respect someone inventing a better loom or computerizing precision machining, but finding suckers to work for free is not something I want to promote.
January 28, 2009 5:53 AM | Reply | Permalink
As I said, your earlier comment was muddled as I read it. First you said in effect "forget non-domestic" and then you immediately talked about non-domestic factors. I asked in effect for you to clear up your point for me.
I said "cheap labor pool open up". It's not a cheat to take advantage of labor cost differentials, unless you directly somehow manipulated the labor pools to create that. You mentioned different standards of living, and I would point out the obvious: Different costs of living count, regardless of whether the standards are the same or not. So I asked about "cheat". You ignored that. You cannot assume blanket uniformity in the real world even if underneath it all we are all humans and all living on the same planet. Some people want to work, others don't. Some want to invest, others don't. That makes for trade of labor for investment, thus capitalism and other "economisms" as a result of different values (diversity of interest).
You also brought up tariffs (indirectly or directly) so I asked if you had a view on tariffs now as different from the early years of the Great Depression (or any other time for that matter). Some have hinted that "free trade" has hurt wages, and some have hinted that tariffs might be what we need. I see problems on both "sides", so I'm curious.
I hope that gets us back on track re my original reply to your early comment.
January 28, 2009 2:42 PM | Reply | Permalink
I said let's exclude raw materials, not non-domestic factors in general.
"(We'll ignore raw materials for now.)"
I asked why we could not have a self-contained economy, and answered my self that we used to have such. I know we imported tea and spices, etc., and some raw materials, but while imports may have enriched a few in the 19th and early 20th centuries, most activity was local, from food through manufacture. We did not lack domestic sources of wood, or metals, or grains, or meat.
And I do support tariffs.
January 28, 2009 4:45 PM | Reply | Permalink
You said that in this context:
"Imagine there were no other countries, no foreign markets to sell to, or to buy from."
That's the first thing you said, and it sets the context. You then muddled by invoking foreign competition.
It's still not at all clear what if any point you had back then.
We cannot have a self-contained economy if we trade with others. That's why. Don't confuse containment with sufficiency, relative or absolute.
January 28, 2009 6:12 PM | Reply | Permalink
That was Keynes' mature position (see Skidelsky's abridged Life of Keynes, page 495)reached after a life time brilliantly defending the "classical" position on free trade.
Whatever its applicability for less self sufficient countries free trade-as defended in Reich's "Supercapitalism"-combined with the containership and satellite communication revolutions- is a time bomb for US workers of all classes.
If you accept the Adam Smith/Max Weber view of the power of greed doesn't it follow that all economic activity will move to the least developed countries with the "outsourcing" profits here monopolized by the "Lords of the Universe" resulting in the widening income gap now occuring ?
Friedman's claim that the transfer of low skilled job leaves the US free to exploit the knowledge trades is directly contradicted by his own observation of the "Bangalore" phenomenem ,the migration of software to the low- not hourly but annual- wage countries where college graduates will work for $2000/year.
We're moving down the road towards a drastically unequal society with frightening social consequences. Who remembers that the fastest growing economy in the first decade of the 20th century was.....Russia?
January 28, 2009 5:03 AM | Reply | Permalink
You are right on all counts, flavius.
What is perhaps most troubling is that this greed dynamic is unsustainable. How long can the economy suffer the disconnect between the non-existent wealth of the workers manufacturing the products and the inability to attain family supporting jobs for those who are the intended consumers of those products? This dynamic allows for some pretty tremendous short-term profits, but it ain't going to be pretty when the economy eventually grinds to a halt with nothing in the fuel tank to drive it.
Check that. Perhaps we are already there?
January 28, 2009 11:52 AM | Reply | Permalink
We are already there.
January 28, 2009 1:02 PM | Reply | Permalink
co-sign!
January 28, 2009 1:12 PM | Reply | Permalink
"We're moving down the road towards a drastically unequal society with frightening social consequences. "
Wait a minute. You're talking locally about global society. The spread of American wealth to Bangalore represents an *equalization* trend, not a move towards drastically unequal societies. This is the global promise of globalism. You're arguing provincially. While as a provincial myself I can understand that, I feel we should not ignore the larger picture.
What might be scary is that US society may have to reduce its standard of living towards what the standard of living used to be in those formerly "third world" countries and markets. The success of education is working against the US (to some extent).
Decades ago it was called "brain drain".
Is the current recession a harbinger of massive dislocations in the domestic economy (with flight of capital growing)? Is the US headed quickly towards the worst side of where England is?
January 28, 2009 3:31 PM | Reply | Permalink
Eds, you said: “It seems odd to call for upward pressure on wages when we have a huge trade deficit largely due to lower labor costs abroad, and are entering a recession which will be hard on many businesses.”
Isn't what is being suggested here about an upward pressure on wages to the extent that such pressure squares with more fairly sharing wealth created (recession or not) by all those who participate? Won't that create a more stable economy? That is quite different from workers or policy makers unfairly promoting random wage increases. Many average workers have been taking out second mortgages to just pay their bills while corporations, big investors and execs raked in record profits. And at the very same time, average taxpayers are looted for unnecessary wars & secretive bailouts and encouraged to participate in a housing bubble.
I met a worker with experience and a graduate degree unsure he'd get any monetary return on his investment in higher education. He took a few years off to be with his baby and because of uncertainty about this new economy, accepted an editing job in his area of expertise, despite that it paid ½ (35k or something) of what he had made before. (He took a job with one of the big publishing companies that service university libraries with journal article databases) Turned out the company he worked for was still growing with increasing profits that did not trickle down. He felt they took advantage of the problems facing other industries and the economic climate to unnecessarily cut wages and underpay their own workers. He could afford to take his chances and quit --and he did. Interesting to note that the very schools who buy the services of companies that exploit educated workers do so at their own peril.
It's seems the majority of white and blue collar workers are at risk the way the system has been perverted in a favor of a few. If we do nothing to increase fairness, will we just end up with a burnt out economy run by a few less than visionary fat cats and the rest in servitude?
January 28, 2009 2:01 PM | Reply | Permalink
"it seems odd" is important, and the question of timing is important. You said "(recession or not)" but that's part of the timing question.
I do understand the general idea that investors might do better than labor in some situations, and not just in this or that company, but over a sector or even over a large part of an economy. But I'm hard pressed to grasp the necessity of this "nice idea" (nice as it supports the idea of making labor stronger).
Let's also not forget that a very large fraction of the population is technically not working. Kids, some students, and a growing number of retirees (who might take small jobs anyway) and people who just cannot (disabled, elderly, etc.). Baby boomers who truly retire will be living off prior investments, not off wages. If we take from investors to give to labor, we take from them not just from the very rich.
Anyway, as another comment of mine said, Reich doesn't make a case for "stronger unions", he makes the case for more weak unions.
January 28, 2009 3:01 PM | Reply | Permalink
PS to my previous comment:
"Stronger Unions"
Reich's title proclaims that we need stronger unions. But EFCA does not make for *stronger* unions that I've heard. It makes for more *weaker* unions, or at least more weaker unionized locations.
Was Reich's irony intentional?
January 28, 2009 4:05 AM | Reply | Permalink
I have read some of your posts and they are truly uninformed regarding unions, history (why is their low unionization rate and the EFCA).
For example, this post regarding "stronger unions" is a red herring. Obviously, if workers have a "free choice" to join the union compared to the current corporate practice of workplace intimidation, closed door meetings and outright firings of pro-union employees with no recourse--the employees would have the opportunity to weild some power.
Therefore, any organized union will provide the employees with power (strength) compared to not having a union. Just by having a union does provide strength at the workplace. The more unions that become organized provides bargaining power for that unionized occupation, but also the non-union employees with similar jobs are given almost exact pay and benefits (as a way for the companies to keep unions out).
Just the threat of joining a union will have the companies making concessions to the workforce. So, unions provide power to both those within and without the union. That is one reason that companies and Republicans have been trying to destroy the labor movement since the 1930's.
January 28, 2009 6:00 AM | Reply | Permalink
Who might need help are weak workers who cannot or will not organize to form a union in the first place. But the strength of a union doesn't come from making it easier for unions to form, it comes from the determination of the people in the union. If they are not determined, the union will be weak. You cannot blithely assumes that unions are an end in themselves here and expect no challenges.
You can call it a "red herring" if you like (tho' it's not) but it was clearly a comment on Reich's rhetoric and the implications of the irony in his post which followed from the title, and as such it remains right on, untouched by your reply to my comments.
January 28, 2009 3:18 PM | Reply | Permalink
Unions are one of the primary causes of the current economic distress. The main reason union membership has declined is where they were able, they've priced the industries they were involved in either overseas, or out of business.
The domestic auto industry is a good case in point. Non union plants, mainly in the right to work, non socialistic South, are flourishing. The big three, once the undisputed kings of the world, have been union contracted to death.
The main obstacle to union organization is not intimidation, but worker intelligence. At least in the South, most workers are too aware of it's consequences to allow unionization. Lower IQ workers in the North, however, cling to the idea there is such a thing as a 'free lunch'.. Hence the longer unemployment lines in these areas.
The innocuous 'card check' voting system you advocate is exemplary of the degree of prevarication you find necessary, Mr Reich, to make your case.
The secret ballot is sacrosanct. How could a secret ballot be intimidating? The most intimidating voting method imaginable is the 'card check' system. As an employee casts his/her ballot, two union goons stand behind them, billyclubs in hand. If the employee votes against unionization, the goons beat the dog-living shit out of them. This is how desperate the unions, and socialists like you, Mr. Reich have become.
January 28, 2009 9:23 AM | Reply | Permalink
There is no relationship between IQ and lunch, free or otherwise.
I might add that one of the major challenges manufacturers confront when relocating to the South is a shortage of skilled labor.
January 28, 2009 11:17 AM | Reply | Permalink
You can add what you wish. Fact of the matter is, these economic entities in the south are flourishing as the rust belt continues to rust.
Industries continue to locate in the south, fleeing the tyranny of organized and unfortunately, legal thuggery.
January 28, 2009 5:34 PM | Reply | Permalink
I think it has less to do with thuggery than with tax incentives. And even that doesn't always work. Steve Katz blogged on this topic last month. Sorry to drag you into this, Steve.
January 28, 2009 6:19 PM | Reply | Permalink
Your post relies on some common misconceptions of current labor organizing rules and what "card check" means. As of now, for most industries, what happens is:
a) employees fill out a form asking for a union election
b) they submit them to the NLRB, or some other neutral third party, which then verifies them,
c) if a majority have asked for an election, the union and the employer have a set time to campaign to organize (or, in the case of the employer to campaign against organization)
d) after that period ends, a "secret ballot" election is held.
If EFCA passes, this process will end at (a). If a majority of the employees say they want to form a union, then that decides things - unless as few as 30% of the workers at the workplace request an election, in which case the process will follow the earlier pattern.
In other words, the legislation does not introduce any invasion of privacy that doesn't already happen under the current system. And by avoiding elections, EFCA cuts out the stage in the process that employers have abused most.
None of this would be necessary if employers had either a) submitted to the law and not harassed workers in illegal ways, or b) worked effectively to get the law changed so that they could intimidate workers with impunity. The bottom line of EFCA is that too many employers abused the system, and so now most Democrats agree it needs reforming.
January 28, 2009 4:53 PM | Reply | Permalink
What is EFCA?
January 28, 2009 5:39 PM | Reply | Permalink
2nd to last para of the blog post we're discussing.
January 28, 2009 6:31 PM | Reply | Permalink
Thank you.
This must become the mantra for EFCA: It's the ONLY way to get us out of this economic mess in a long-term, sustainable way. The ONLY way to start expanding the middle class once again. The ONLY way to ensure broadly-shared prosperity. The ONLY way to provide our economy with the purchasing power to grow consistently without taking on too much debt and going back to the bubble-burst cycle of the past few decades.
January 28, 2009 9:37 AM | Reply | Permalink
Yep. And anyone who reads "The Work of Nations" will see that America's corporations were actually more powerful when they had to bargain with unions than they are now, even if the executives are now far wealthier.
America's workers have been tricked into turning out more product for less money. They call it the miracle of productivity and give credit for it to technology but it's really people working harder for less.
January 28, 2009 9:38 AM | Reply | Permalink
Substitute "outsourced," "automated" and a few other words for "tricked," and I second.
January 28, 2009 11:21 AM | Reply | Permalink
A distinction must be made between private sector unions and public sector unions.
As long as there is a large number of private sector unionized employees they then can support public sector union member's wages and benefits.
Unfortunately, what appears to have been happening is a drop in private sector unions and a rise in public sector unions. This is not sustainable.
In our area, as in many others, the schools, in particular are funded by real estate taxes. The teacher's take upwards of 75% of the school budget leaving all other entities; maintenance, cafeteria, bus drivers, debt service, supplies, construction, etc. to scramble for the remaining 25%. These real estate taxes have become oppressive to many, especially those on fixed incomes.
The police dept, paid with township taxes takes up to 70% of the township budget. Both entities, police and teachers, have much better health care, salary, pension, sick leave, etc., than many in the private sector which pays the bills.
We have now gotten to a point where public sector employees have it better than many in the private sector.
My point is that unless something changes, like a surge in private sector union membership, the private sector that appears to be in retrograde cannot continue to support the public sector union members.
I once had a debate with a teacher who claimed he paid taxes too. I claimed he did not pay taxes, I paid them for him since his gross pay from which the taxes come, was paid for by the private sector.
January 28, 2009 9:38 AM | Reply | Permalink
John 1W1141 -
Do you think we should go back to the days when teachers earned less than bank tellers? Before the NEA and NFT got tough in their negotiations that was the state of teaching. Teaching was a 'female' profession - women brought home 'extra' income. Didn't matter if she was the only breadwinner - women were told they didn't need to earn as much as men.
Things got better in the late '60s because teaching was a profession that kept men out of the draft. As more men entered the profession, wages went up and the unions got stronger.
I'm sick of people who don't think teachers and other civil servants earn their salaries - remember that the next time you look forward to the end of summer vacation - we have your kids all year!
January 28, 2009 4:58 PM | Reply | Permalink
Powkat,
I never said teachers or other public servants don't earn their keep. You need to re read my comment as you missed my point entirely.
January 28, 2009 5:57 PM | Reply | Permalink
Cheap education is part of the downfall of the American economy. Ironic, huh.
Education at one time was something capitalists did not want. An uneducated worker can be trained to do a narrow job cheap. An educated worker makes trouble and generally costs more. But somehow education became important, and the idea of a broad (if often shallow) education replaced the idea of learning a trade in the narrow sense.
Now non-Americans can take our knowledge and use it to their own benefit, costing us jobs and domestic profits!
January 28, 2009 6:07 PM | Reply | Permalink
I am a member of the NEA and I am thoroughly embarrassed by the NEA. The NEA refuses to allow merit raises while maintaining that teachers who are not only BAD at what they do, but also HATE it, are given the same salaries, protections and privileges as teachers who are both talented and passionate. While I don't think that teacher retention should be left to demented parents, I also don't think that demented and disgruntled teachers (or any public servants for that matter) should be given tenure. I also think that if a worker has earned a raise and their boss wants to give them the raise then the union should back the F*** off. And forcing workers to pay dues to a union that refuses to help them is insanity. The NEA is one of the stupidest organizations in existence, and should be dismantled as part of fundamental education reform. First, the NEA, then the Dept. of Education. That's the only way we can get anything done for our kids.
January 28, 2009 9:22 PM | Reply | Permalink
Not only have unions helped with wages for workers, but to my mind one of their most important functions is in protecting workers from unfair workplace practices or supervisors. It gives the worker an assurance that they are not alone in facing supervisors or management in general. Whether it is in negotiating wages or in everyday problems, which any worker might encounter, related to hours and work conditions and so on.
Thank you, Mr. Reich!
January 28, 2009 10:06 AM | Reply | Permalink
TheraP,
truly. I once had a friend, now deceased, who was in the Teamsters Union for more than 30 years. He worked for a major trucking company who had a terminal in Philly.
He once told me there used to be a big turnover of Terminal Managers and because of that he worked for "the good, the bad, and the ugly."
He said some of those managers felt the need to make labor's life miserable and felt almost elated when they could "get somebody" (fire a worker). He told me it was this type of manager that made going to work everyday depressing.
From a humanitarian viewpoint, there is no doubt that many companies need to be unionized.
January 28, 2009 10:54 AM | Reply | Permalink
You know something, I'm beginning to think that some of us Boomers - especially here on this board - who recall a day and age when people cared about each other and our government was structured in view of serving We the People - us Boomers, who now have time to devote to serving our nation and writing about the ideals from which we have strayed - may in part help to restore what has been lost. I note the number of posters and commenters here "of a certain age" and of a "mighty power of the pen" - using the power inherent in We the People - on behalf of those who cannot speak as loudly for themselves, those who have been beaten down by unjust laws and regulations.
I feel a powerful solidarity building. And I think we Boomers can become a powerful voice in the service of Justice.
January 28, 2009 11:24 AM | Reply | Permalink
Another great comment. I agree with you 100%. It seems as though there are two age groups with the time and circumstances to commit to making a difference for "we the people". Young adults and those of us of "a certain age". Those in the middle are too busy making a living, paying mortgages and raising kids.
I have many young friends in their 20s and I must say I am encouraged by who they are being. It reminds me of us boomers when we were that age.
January 28, 2009 12:00 PM | Reply | Permalink
I'm cogitating a blog on this. It kind of blows me away to see the banner of our ideals held high by a younger generation. I really feel energized by that. And yes, we have TIME on our hands. Nothing like Time and Ideals combined! As in our youth. :)
January 28, 2009 12:07 PM | Reply | Permalink
I'm in the middle, trying to both and probably not doing the best job of either.
But I continue to hold fast to the belief that change is made by quiet people doing ordinary things.
January 28, 2009 1:07 PM | Reply | Permalink
Kudos for all your hard work, then! :)
January 28, 2009 1:11 PM | Reply | Permalink
Labor of love, TheraP. Labor of love.
January 28, 2009 2:13 PM | Reply | Permalink
I know just what you mean. :)
January 28, 2009 2:19 PM | Reply | Permalink
TheraP,
I'm not a Boomer, I'm a creator of Boomers. :-)
January 28, 2009 12:20 PM | Reply | Permalink
WoW! How old are you, then?
January 28, 2009 12:25 PM | Reply | Permalink
I'm old enough to have fought in WWII. :-)
January 28, 2009 3:10 PM | Reply | Permalink
Well, then you sure are a hero bigtime! Fought for our values in every possible way. And still fighting! :)
January 28, 2009 3:17 PM | Reply | Permalink
John Rawks and he has a nice voice, too. He called Josh on CSPAN
=D
January 28, 2009 3:54 PM | Reply | Permalink
That was me that called Josh on C-SPAN. I identified myself as JohnW1141 the WWII paratrooper and suggested he mention The Golden Duke Awards.
January 28, 2009 4:29 PM | Reply | Permalink
Yes, I heard you. Twice. (I watched it online twice.)
You're a treasure on TPM, as far as I am concerned. You're even right most of the time.
=D
January 28, 2009 4:43 PM | Reply | Permalink
Thanks, mom. :-)
January 28, 2009 5:59 PM | Reply | Permalink
As I see it, our trade policies present the biggest impediment to Unions and to the ability of the American Worker to gain a living wage in this economy. We will never recover our manufacturing jobs or our earning potential until such time we quit treating labor as a commodity (Human Resource) to be purchased on the world market. The U.S. worker simply cannot be expected to compete with sweatshop labor, prison labor, and other exploited workers throughout the world.
Instead, we should have trade policies in place that let our corporations know they are welcome to build manufacturing plants overseas if they wish, but they will NOT be allowed to bring those products back into our domestic economy for sale.
I can almost hear the free-traders squeal at such a suggestion. Such regulations would be protectionist, they will complain.
And they would be right.
Such regulation would protect the American Worker from losing ground in his earning capacity out of necessity to compete with foreign labor. Just as importantly, such regulation would also protect foreign workers from being exploited by corporations who would pay them little or nothing to make products destined for consumers in other markets.
Sensible trade policies will protect workers in this economy while encouraging the healthy growth of a consumer economy in foreign markets by providing to laborers a wage sufficient to participate as consumers of the products they manufacture.
January 28, 2009 11:10 AM | Reply | Permalink
I think the biggest impediment is the concept of "corporate personhood." Not that I disagree with your analysis, SJ.
But I find that so many companies could be unionized, not just the ones that manufacture, where jobs have gone offshore.
I think if we get rid of corporations have rights of citizenship, so to speak, the people's rights will come to the fore - as they should.
Any thoughts?
January 28, 2009 11:28 AM | Reply | Permalink
You are absolutely right in pointing out "corporate personhood" as a vital issue. There are so many ways in which this has affected the worker's ability to participate as "owners" of this economy, and none of them are any good for us workers OR for the economy at large.
And what is most galling is that the "free marketeers" consider these corporate "persons" to be "The Untouchables" when it comes to regulations and accountability, and yet they often provide nothing in terms of taxes paid or benefits provided to the domestic economy overall.
I get angry just thinking about it, and could rant for days on the topic. You are absolutely correct in pointing this out as a topic that is germane to this discussion. Thanks for raising the issue!
January 28, 2009 11:42 AM | Reply | Permalink
YES! You've voiced my own concerns with a wonderful passion! Thanks, SJ. :)
January 28, 2009 12:12 PM | Reply | Permalink
Passion? Some have been known to call it "curmudgeonly crankiness." ;O)
January 28, 2009 12:18 PM | Reply | Permalink
It's nice to be old enough that any names they might call us bounce off us - cuz we're made of steel! We've steeled ourselves over many years. And we're proud to stand firm to protect what we know is Right and Just! Emotion in the service of those two can be called any name in the book, but it will not deter us one iota! We're on the right side of history. We'll march, even in wheelchairs!
January 28, 2009 12:24 PM | Reply | Permalink
This is why I believe we will see more and more people forming nonprofits.
Coming out of these economic dark times, I also think we will see an increase in sustainable employment practices as companies -- not all, but some -- begin to see it as a matter of enlightened self interest. Right now, in the main, "corporate citizenship" is a PR strategy.
January 28, 2009 1:23 PM | Reply | Permalink
I hope you're right. I love that idea!
January 28, 2009 3:17 PM | Reply | Permalink
I wonder if anyone has ever tried to have a corporation declared insane? I'm sure the case could be made that some corporations are a danger to themselves [see GM] and others [see the middle class].
If corporations have the same privileges as humans, they should have the same risks, i.e. involuntary commitment to the institution of OUR choice.
January 28, 2009 12:37 PM | Reply | Permalink
Some political parties could be accused of the same. Indeed, being a "danger to others" might be more of a qualifier in both cases!
Brilliant suggestion. In the court of public opinion, we might win.
January 28, 2009 12:42 PM | Reply | Permalink
There are only two ways to really create new wealth. One is to manufacture a product and the other is to grow something from the soil. All other industries are a transfer of wealth. Now that the manufacturing is gone from the United States we have a really bad economy,no shit. We are becoming a nation of consumers only. The demand for my cattle and grain has fallen off mainly because of unemployed workers.
I believe low interest rates that attracted money from bank savings accounts and into the stock market helped further our problem. Stockholders received some very high returns on their investments originally. Double digit returns year after year after year are unrealistic. A four percent return in farming would be pretty darn good.
As manufacturers looked for ways to cut costs overseas labor got way more attractive.
I believe you have to protect agriculture and manufacturing because without that what have you got.
January 28, 2009 11:58 AM | Reply | Permalink
No argument here, MoFarmer.
You raise another issue as well, that being the realities of our stock market. Stockholders are the "owners" of the companies in which they hold stock. They can be expected to act - like any business owner - in the best interests of the company, right?
Should be the case, except that more and more of these shares are managed through mutual fund agents and other intermediate money managers. Their primary interest - in fact, sole interest - is in the short-term profits to be gained from the shares, which are treated more as betting tickets rather than ownership shares. This results in the corporations' need to always look to improve the next quarter profit report, regardless of the impact these decisions might have on the long term health and viability of the company.
Needless to say, it's not a very effective way to run a railroad. A Casino? yes. But a business enterprise? no.
Yet another dynamic that has impact on the farmer is the manner by which our commodity markets have become the riskiest of casinos for the high rollers on Wall Street. Anymore, you can expect the entity that bids for delivery of corn, for example, to be a hedge fund manager or other gambler who has no intention of actually taking delivery of so much as a single bushel of corn. This commodity market as gambling house greatly perverts the market for those whose livelihoods depend on the market (farmers and consumers) to regulate their profit/loss exposure. It is simply shameful the way in which it works - and I suspect criminal in many cases for the strong potential it provides for insider trading abuses and the like.
January 28, 2009 12:15 PM | Reply | Permalink
We WERE a nation of consumers. Now that the consumption process has nearly ground to a halt, and everybody realizes we can consume food and the gas needed to get the food (I'm counting work insofar as that is needed), and the housing needed to cook the food and rest the weary, there's enough stored up consumption to last us quite a while. Given the uncertainties, few among us will go out to shop for anything other than necessities.
We are a nation in search of an economy, I'd say.
January 28, 2009 12:19 PM | Reply | Permalink
"We are a nation in search of an economy, I'd say."
Very nice. May I offer you your own advice, and suggest you do a blog on this? :-)
January 28, 2009 3:41 PM | Reply | Permalink
How kind of you to suggest that. But I'm not sure I have a whole lot to say that I haven't said right here.
However, if you like the idea and want to run with it, be my guest. All my ideas are "open source." I'd be pleased to have you follow up yourself. :)
January 28, 2009 3:54 PM | Reply | Permalink
Ok, I'll just take that one comment and put up a blog and see where it goes. If you've already done that, I'll take mine down.
See how affect me, eds? :)
January 28, 2009 4:12 PM | Reply | Permalink
You say:
"I believe you have to protect agriculture and manufacturing because without that what have you got."
My grandmother, who came of age during the Depression, used to say:
"They will make more cars; and other things...but they will never make more dirt" when telling me why I might wish to consider staying on the remains of the family farm.
It wasn't much; but if you had nothing else, you could at least grow your own food.
So perhaps a stimulus bill could include aid to relocate to small farms for those interested. Nah, that's too much like thinking different and outside the box.
January 28, 2009 1:52 PM | Reply | Permalink
Not much difference between this:
"The way to get the economy back on track is to boost the purchasing power of the middle class."
and this:
http://blogs.wsj.com/economics/2008/10/07/
Should Bush Tell America To Go Shopping Again?
(Mr. Bush in late Sept. 2001 urged the American public: “Fly and enjoy America’s great destination spots. Get down to Disney World in Florida. Take your families and enjoy life, the way we want it to be enjoyed.” He’s even asked consumers to spend during better times. “I encourage you all to go shopping more,” he said in December 2006.)
Nevertheless I shall with gladness of heart purchase the recommended bill of goods because I'm going to help you whether I want to, or not. I shall pay you on Tuesday.
I just wonder if I will be declared an apostate by this church: http://www.revbilly.com/ as well as the others to which I am apostate.
Seriously, though: I have to wonder how much longer people like me will be (must be?) viewed through a lense that outlines us as consumers.
There is something here that I cannot quite verbalize. It has to do with lack: lack of role; lack of definition of role; lack of concept of role; something about what we do.
Don't get me wrong: Unions? Hell yeah!
January 28, 2009 12:00 PM | Reply | Permalink
Thom Hartmann has been singing this song forever.
January 28, 2009 12:40 PM | Reply | Permalink
(I appologize in advance: the following comment is quite long, I'll be posting it in other more appropriate places soon)
The United States has only one governing principle: Free Contract. In such a society bargaining power means everything. What you earn is a function of your bargaining power. Concentrated wealth renders a society unstable and an economy brittle. To avoid such concentrations, individuals bargaining power has to be enhanced.
The founding generation thought they had found the key to this in democracy. Indeed, even with 3 million people in servitude, the United States had the broadest distribution of wealth in history right up to the start of the Civil War - when we went to war over the issue of empowering the remaining 3 million slaves with equal rights, privileges and bargaining. Despite the success of the civil war, 25 years after its conclusion the United States suffered from concentrated wealth and widely disbursed squalor.
Between 1860 and 1890 what went wrong? How could wealth be so concentrated in a democracy set up to do the opposite? The invention of the modern limited liability corporation in 1862 (in England first) changed everything.
The founding generation hadn't conceptualized this institutional arrangement.
Corporations are an ownership collective. They are granted a massive concession by society, limited liability. As a collective they have massive bargaining power leverage over individuals. This bargaining imbalance contributed greatly to the concentration of wealth.
19th century America was prone to booms and bust, perhaps in part, some economist believed, because of a lack of a central bank. However, the busts kept getting worse and deeper as wealth concentrated. The creation of the Federal Reserve system was intended to address this problem, but as an institutional arrangement it could not address the imbalance of bargaining power in American society.
Finally, after the great depression, collective bargaining in the form of industry unions, emerged to address the imbalance. As an institutional innovation they worked fine - until they collided, in international trade, with more sophisticated institutional arrangements from overseas.
There are some basic problems inside the American Unions system. It works fine for industries, trades and economic activities that don't have to compete internationally: All of Robert Reich's examples are ones in which the workers here don't compete with workers over seas. But for industrial corporations the American model has created anti-competitive industrial oligopolies (steel, autos) that suffered from industrial sclerosis - making those industries easy pickings for more competitive foreign corporations.
We need to look hard and deep at the institutional arrangements that foreign societies have implemented and implement some adjustments to our own institutional arrangements.
First and foremost has to be Japan: Japan has the most competitive industrial corporations in the world AND the broadest distribution of wealth in the world - broader than even Scandinavian countries. (See "Time Almanac 2007 with Information Please" [hard back] p.670, [note Japan Gini index 24.9, Denmark 24.7, Sweden 25.0, Finland 25.6, Norway 25.8, Canada 31.5 the U.S. 40, Brazil 60.7])
Clearly Japanese institutional arrangements need to be studied and considered.
I studied, as much as possible, in Law school, the Japanese corporation. Americans on both the left and the right want to sweep the Japanese model under the rug rather than study it - but it is understandable and quite revealing.
The Japanese system is based upon company unions: one company, one union. Traditionally in the United States company unions have proven feckless and ineffective. As a result the U.S. has industry unions: one union many companies. In this arrangement the bargaining power advantage is reversed and so, it can be argued - especially in cases like autos, the workers are too successful, rendering their companies uncompetitive. This institution arrangement is acerbated by American anti-trust law, allowing for mergers and greater consolidation within an industry. Also, workers loyalties are split between employer and union.
The complete collection of American institutional arrangements has proven uncompetitive against foreign models, providing Republicans and the like the pretext for assaulting the Unions as a credible institutional arrangement. This in turn has lead to the demise of the labor movement and collective bargaining and a return to concentrated wealth, rendering our society and our economy brittle and unstable, and sending us back to 1929 all over again.
This forces us to analyze, with greater thought and circumspect the institutional arrangements we use for level bargaining power in society. Again, American unions work great for industries that aren't subject to international competition, so it's only those industries subject to foreign competition that we need to examine.
The question is, if company unions are feckless in the United States, how has Japan been able to achieve it's startling broad distribution of wealth while remaining competitive in industries that participate in international competition. I spent a lot of time in Law school studying the Japanese corporation trying to figure this out.
The answer appears, to me, to be that company unions are augmented by another institutional arrangement: widespread tenure of employees.
Tenure changes everything.
Tenure forces the company to change its primary directive (to borrow a term from Star Trek). In the U.S. as in Japan, under corporate law and legal theory, corporations are run under "the shareholder primacy rule." That means that directors and managers must consider shareholders well being first in making corporate management decisions. That's the formal and theoretical rule. However in reality, in the United States, the corporation's executives have primacy. In Japan, because of tenure, employees have primacy.
This appears to be the main institutional difference. The reason, I suspect, is under Tenure, it's easier to fire one executive than it is to fire several employees.
The idea that tenure creates primacy got a little test at my law school while I was attending (and debating these points with my Japanese Law professor). At the time, there was a minor scandal: the military JAG corp was being barred from interviewing on campus as a protest against it's open discrimination against gays. The Newspapers got a hold of it and it became a big deal - this was, post 9/11 in the spring of 2002 - about discrimination against the military at a time of war. Through out this whole crisis at the Law School, the Dean was frequently quoted as saying that he was consulting with the faculty to solve the problem. The Dean wasn't stressing his consultations with the University's board of Regents, or with the administrative employees, he stressed his consultations with the tenured employees.
For years Business Hierarchy and punditry in this country has said that the Japanese system couldn't last. That sooner or later they would have to adapt to the American system. But one only has to look at the automobile industry to realize that this claim is absurd on its face. Toyota recently overtook GM, and Toyota's market value was roughly 10 times GM's before the recent SubPrime melt down, today it might even be 20 times. GM's survival isn't based upon the success of its model, except for the size and importance the firm holds for the U.S. economy. The arguement is over: Japan has the superior institutional arrangements and corporate model:greater competitiveness, broader distribution of wealth.
The questions then, is, how does tenure create a competitive edge?
Well, because of employee tenure, corporations can't lay off people - this forces them to focus on long term pursuit of market share. Furthermore, Employees are interested in long term market share growth to secure their employment and their retirement after that. Towards this, in the 1990s, while gas was cheap, Toyota and Honda invested in fuel saving hybrid technologies. They did this because fuel consumption had been market drivers in the past, and they might be again in the future. To secure market share in the future, in the advent that fuel consumption might become a market driver in the future, they felt they had to invest in hybrid technologies.
Contrast that with the American companies, driven by Executive primacy. The average tenure for a CEO is around 4 years. Their time horizons are very short minded. In the 1990s Ford made a now infamous and highly publicized decision to concentrate only on trucks and SUVs. Ford's profits were up, the executives all got great bonuses, and by now those senior executives are in retirement while current management scrambles to adjust to the new reality.
Another example has to do with consolidation: Japan with less than half the population and one tenth the paved roads, has eight car companies the U.S. has three (depending upon definitions). There is less consolidation in Japan. This is because employees don't like consolidation. This is the one area where shareholder and employee's interest don't align because shareholders love consolidation (they get a one time 'contol primacy premium on the value of their stock when consolidation occurs). However this is better for society: less consolidation means more companies competing in the same market which creates for more competitive industries.
There is another benefit for society: more firms in an industry means that their is less likely to be a single firm 'too big too fail' that must be bailed out during and economic crisis.
Another consideration: the combination of fragmentation and company unions means that employees don't have split loyalties between company and union. This sharpens competitiveness. It also makes it likely that employees find communitee in their work place and not from their union.
These are anecdotal examples of how widespread tenure creates competitiveness. There are other down stream effects - the whole perspective changes on a range of issues: the employees themselves become long term assets that must be invested in. To understand the dynamics I would suggest read "The Evolution of Cooperation" by Univ. of Michigan Economist Robert Axelrod (a conceptual explanation of game theory - hint: in Game Theory the parties are in a perpetual unending game that has no perceivable end and so civility and cooperation ensue).
The next question is: why should shareholders prefer employee primacy? The short answer is to ask a shareholder which stock they rather have held over the last 20 years - GM's or Toyota's? As it turns out, for long term shareholders, the employee is a better proxy then American style board of directors (who tend to be controlled by the executives): both shareholders and employees are interested in the long term market share growth of the corporation. For the employee this means economic security, for the shareholder, because stock markets highly value market share, the value of their stock goes up over the long term.
Of course there are other ways, other institutional arrangements that can be considered. In Germany, unions and even communities where companies are located sit on the board of directors. This helps ensure that decisions reflect long term interests and competitiveness.
All of these things are missing in today's American model.
It all goes back to the governing principle in American society: free contract. Free contract means that bargianing power is everything.
Everything that goes on around us reflects this: from advertisements on T.V. to politics in Washington to personal grooming habits, it's all about individuals or groups trying to gain added bargaining power.
What you earn is a function of your bargaining power. CEO pay has gone up because their bargaining power has been enhanced.
Since 1978 the median per hour wage has remained flat while GNP has more than doubled: With a 13 trillion dollar economy that means trillions and trillions of dollars flowing to a very narrow percentage of the economy year in and year out. On top of that, Bush's policies over the last 8 years may have pushed as much as another 10 trillion dollars from the 'demand-side' of the economy to the 'supply-side' of the economy (we are starving ourselves of feed corn for the want to increase the amount of seed corn).
Economic history, and it's a history that goes way back, has shown that for a society, concentrated wealth is like standing up in a dugout canoe, it's prone to sudden catastrophe.
Concentrated wealth (and power)(i.e. caused the collapse of: Ancient Egypt's New Kingdom, Rome (See Nobel Laureate Douglas North's "Structure and Change in Economic History" pages 100-115), Pre-Islamic Mecca (Islam being a reaction, in part, to concentrated wealth), Byzantium (the before the battle of Manzikert in 1071 triggering the loss of the Anotolian heartland), Medieval Japan, Hapsburg Spain, Bourbon France, Romanov Russia, Coolidge/Hoover America (triggering the Great Depression, the rise of Hitler, militarized Japan, World War II and the Holocaust), and now the Subprime Loan Melt down.
The later two collapses were brought to you courtesy of the Republican party. In the case of Rome and Japan, multicenturied dark ages followed. (Oh, I forgot to mention in that group the collapse of Nationalist China).
Concentrated wealth triggered the Great Depression, which triggered World War II. In his "Finest Hour" speech, Churchill suggested that if Britain lost the Battle of Britain a new dark age would descend over Western Civilization, but if they succeeded the world might enter a new golden age. Indeed, the English won, and after the war, the combination of widespread collective bargaining and liberal economic policies world wide (and low energy prices), global productivity doubled between 1945 and 1973. In less than 30 years the global economy grew more than it had the prior 11,000 - creating history's most golden of golden ages in almost every human endeavor, from politics, to art, to science, culminating in man's landing on the Moon.
The median wage has remained flat in the United States since 1978 because of the decline in collective bargaining. The decline in collective bargaining has been exasperated by decline in international competitiveness of America's unionized industries.
We need to make it easier for companies to be unionized so that we have broader distribution of wealth creating a more stable society and economy.
But it's not a one size fits all situation.
For industrial corporations we should look for a modified, enhanced institutional arrangement. American society is not the same as Japan, nor Germany, but we can an ought to look at what they've done and come up with our own innovation for providing for greater competitiveness and broader distribution of bargaining power and therefore wealth, thus making our society and economy more stable and families and individuals protected from unnecessary suffering and squalor.
January 28, 2009 2:22 PM | Reply | Permalink
Except for the very last point (Wilson was at least as responsible for the depression as Hoover and Coolidge and Clinton was at least as responsible for the Sub Prime mess as Bush. We have a history of the little guy getting screwed in a bipartisan manner.) this comment provides a lot to chew on and much that I agree with.
I actually think we need to simply make all those items that unions typically bargain for (living wages, pensions, health care) a function of the state and let companies concentrate on making whatever widget they were formed to make. We have lost sight of the common good as every conversation of this nature is couched in a narrative of competing special interests.
Collective bargaining has never made up more than 30 percent of the workforce, yet we enjoyed many decades of consistent wage growth in many industries post World War II, both union and non-union. What we need is collectively bargaining at the federal level on behalf of the 99.99% of us who will never have a trust fund, regardless of who we work for.
That was supposed to be the point of our democratic ideals, yet never quite found a way to live up to.
January 28, 2009 3:02 PM | Reply | Permalink
A big Thank You for addressing my nagging question about what can be done to sustain industries that compete directly with cheaper labor abroad.
For someone with little expertise in business structure and labor issues, this is the most informative thread I've read on the topic. I have a much better feel for the big picture now.
January 28, 2009 3:27 PM | Reply | Permalink
This is one of the most educational comments I have ever read on a TPM thread!
It makes so much sense to me. Indeed, as a psychologist, it looks like you're trying to see how we can set things up so that the groups jockeying for power are encouraged to use delay of gratification in view of long term common goals.
Thanks for the long, educational comment. Kudos!
January 28, 2009 3:37 PM | Reply | Permalink
There's another psychological perspective as well, that I only allude to: Community.
First, there's a need for most humans to live in some degree of community. For most people healthy community is conducive to healthy psychology - (though healthy community is quite a trick in itself - one for psychologist to pursue - I rely upon M.Scott Peck's work on community, or for a short fix on what healthy community might look like I might just watch the movie "Dances With Wovles").
I've even read once, in the NYTimes several years ago, where scientist have found that being in community and working cooperatively triggers pleasure impulses in the brain. I would argue though, that this probably varies from person to person. Nevertheless, I've was quick to pick up upon the possibilities, and being single, when I start dating someone knew, try to create situations where my date and I are working on a pressured project together collectively - it's paid dividends when it works - like putting on and preparing a dinner party for several other couples. But I've strayed far afield.
The point I wanted to make is that the Japanese combination concentrates and aligns communal loyalties. In the U.S. white collar employees at Ford might feel more in common and therefore more in community with white collar employees at GM, and blue collar employees at Ford might feel more in community with blue collar employees at GM. This never happens in Japan: because union and company coalesce, so does the sense of community. As i recall, Peck said an important attribute of community is commitment - and Tenure bakes that aspect into their model. As a result the company is a community. This, I believe sharpens, even more, the competitive attributes of the firm.
As a side note: I don't want to attribute these positive things to Japanese corporations. It is a function of the Japanese system and Japanese law: when in the United States Toyota functions differently, as in Mexico and so on - only in Japan do they function like a Japanese company. The function this way because the law and other systems force them to. If Toyota's and GM or Fords execs traded places tomorrow, the day after tomorrow they would all suddenly be behaving the way the circumstances dictate. It's the system, imprinted by law, that matters.
January 28, 2009 8:32 PM | Reply | Permalink
Here's what I'd add, Tim, to your concept of community - which certainly enlarges it beyond Japan. I think community includes a sense of working for something larger than yourself. That could be a common task, to which you commit. It could be values and so on. You're seeing it in terms of "no end in sight" and I'm seeing that sense of "we-ness" in terms of common goals, values, commitments.
There's a lot to chew on here. I'm glad I came back to this thread. And thanks again for all your insights and information. I found your initial comment so helpful, that I actually came back here to post a link to that on a short blog I've got up now.
I hope we see more of you, Tim! :)
January 28, 2009 10:27 PM | Reply | Permalink
Yes, the whole communitarian concept is like an onion, with many layers of meaning, and I would say, virtues, but also some vices - I see Communitarianianism and libertarianism (small l) as two parallel philosophical strains of thought, or a double helix even, that are best lashed to gether to form a check and balance on the excessiveness of the other. So yes it is very complicated.
But what I wanted to note, is to imagine the situation where you are working on and towards something that is bigger than your self, but also where that something is largely aligned with much of the interests that serve the self - a situation where one's work both norishes ones self, and others, and then something bigger than one's self, in fact bigger than all the parts of all those somethings.
I think those situations are more likely to pop up when one factors communitarianism (as well as libertarianism) into the architecture of new, innovative institutional arrangements. And there, lies, great virtue.
January 29, 2009 1:26 PM | Reply | Permalink
Very well said and quite thought provoking.
One hears from many, primarily on the right, "Who could have seen this coming?"
In the early 80s I met a German economist who was taking a year to travel around the US with his family.
He told me that it was against the law for CEOs in Germany [at least at that time] to own stock or options in the companies they headed.
He told me that because the executives are human beings, they would make decisions based on their wallets and not on the futures of their companies.
I have been sharing that conversation with my conservative friends ever since then. I have consistently been told that he [and I] didn't have a clue what we were talking about.
I would love to run into him again.
It is one of those times I take no joy in being right
I believe that Sony has a 500 year plan. How shortsighted.
The unions might have more protection if our free trade was a bit more like the European Union. Where we would have free trade with a group of countries who have attained descent levels of human rights, environmental protections, workers rights, union friendliness and have tariffs on the ones that don't measure up.
January 28, 2009 5:39 PM | Reply | Permalink
What I can take from that long essay is simply that bargaining power is power. I agree that when negotiation determines outcomes, those who negotiate best tend to do better in the long run. Once a person has a job, bargaining power shifts. Salaries and perks are not renegotiated daily, or even monthly, in general.
One problem with Japan's model as you outline it is that it doesn't respond well to changes. Employees tend to be locked in to one company just as the company as you make it out is locked in with its employees.
Are these times where we need flexibility of employment, or should we offer more security of employment?
In what ways is bargaining power simply a matter of leverage and in what ways are there other factors? In this current time of "deleveraging" in the financial markets, I keep find 'leverage' to apply almost universally to economic and political questions.
January 28, 2009 5:56 PM | Reply | Permalink
I would say, that the arguement you make is similar to the one the Business Hierarchy Establishiment and its accompanying punditry make: the Japanese system cannot flourish because it locks the companies into long term commitments that it cannot manage given short term variations. As a result the Japanese system cannot survive intact.
They've been making this claim for 50 years.
But it has survived. This is why it deserves close and careful and thoughtful scrutiny, way beyond anything I represented in the above.
First: Locking in the Employees.
How many employees at GM or Ford, or other big, blue chip, well paying companies migrate away, on their own volition, from their current employers. Some, I'm sure, but not many. For starters their are only three car companies. Second, their can be secondary reasons for not migrating, privileges, perks, and seniority and also early exit penalties.
Another aspect of this, is choosing the right % of non-tenure employees. Toyota only has 8,000.
Then there's game theory. As long as you can perceive an end to a relationship, no matter how far off into the future, it encourages adversarial relations (again, see Axelrod's "The Evolution of Cooperation" the first 13 pages will be the most powerful reading you've ever experienced).
The problem with the current situation, because of a lack of Tenure, the relationship between parties isn't cast as perpetual. If you read Axelrod you'll find that that makes all the difference in the world. If you have a perceived perpetual relationship, the parties will work cooperatively, if you perceive the relationship breaking down at any point, even far into the future, Axelrod's studies say it pays to quit cooperating immediately and in fact their are many real world situations that bare this out. Though it's not my favorite, I view his book as the single most important book in the Social Sciences, ever.
Second: Flexibility
The Japanese companies have found ways to handle fluctuations in company fortunes without laying off workers. First starters, cuts come at the top first. Second, the wage system is based upon bonuses. Bonuses go first. Reduction in time and pay happen across the board. Everyone suffers, everyone thrives, the corporation is a collective community.
How does this address our current situation?
Well, in the short term it doesn't. This but in the medium and long term we need to have industries that are competitive on an international level, of course, and we need wages to float with growths in productivity.
January 28, 2009 7:47 PM | Reply | Permalink
I don't believe I made an argument. Perhaps my analysis or criticism is familiar. But I'm not against something like what Japan has. I asked leading questions.
January 29, 2009 1:56 AM | Reply | Permalink
Oh, look; I lament the lack of a role or a concept for a role and lo I am answered.
This has been an interesting day: aptly named Republicans at which I can laugh 'til my sides hurt and now this.
January 28, 2009 9:04 PM | Reply | Permalink
Sadly, Mr Reich leaves out the fact that socialist unions are one of the main reasons for the collapse of numerous companies, driving many overseas. Driving wages higher than are found anywhere else in the world can only last so long. Limiting more and more freedoms and providing for more and more socialism never promotes hard work. Look at most government workers, and members of unions that you know. It promotes laziness and a loss of productivity. Sadly we live in a country where everyone now thinks they are entitled to have everything free when they work minimally. Lazy idiots who choose facts to support liberalism that is now a polite way of describing dirty socialism....and steps away from communism.
January 28, 2009 3:57 PM | Reply | Permalink
The problem with your analysis is that Unions are thriving overseas - EVERY imported car was made by a person in a union - be it Korea, Japan, or Germany.
So the problem isn't unions, per se.
Also, you leave out the fact that corporations are socialist as well. Corporations are ownership collectives, comrad. This country is based on one concept: Free Contract. It's only fair if one party is negotiating as a collective that the other part negotiate from the same stand point.
The real problem with our system is that corporations in this country are run by executives who average only 4 years at the helm, trying to make a big score for themselves and their progeny. Their time horizons are so short sighted that they compromise their firms ability to compete long term. Foreign countries have other institutional arrangements to blunt this executive instinct.
January 28, 2009 7:56 PM | Reply | Permalink
Surely you are not speaking of American workers when you say people who "think they are entitled to have everything free when they work minimally" and use the word "lazy."
The United Nations International Labor Reports show that Americans work more hours (and that trend keeps going up) than any other group in the industrialized world. The studies also show that Americans are also more productive per person. But guess what? We are LESS efficient per hour than workers in France and Belgium who have much longer vacations, shorter working hours. (They pay half as much for health care and live longer, too.)
Communism and Socialism have always been slippery concepts for me. But my cold war era vision of the Soviet Union was depicted a stale, boring place where a few control freaks had all the special priveleges and the rest were in a sort of dismal servitude. I could imagine a Walmart chain as the only store available in a place like that. So maybe you are right and we are well on our way.
"We have heard of the impious doctrine in the old world, that the people were made for kings, not kings for the people. Is the same doctrine to be revived in the new, in another shape — that the solid happiness of the people is to be sacrificed to the views of political institutions of a different form? It is too early for politicians to presume on our forgetting that the public good, the real welfare of the great body of the people, is the supreme object to be pursued; and that no form of government whatever has any other value than as it may be fitted for the attainment of this object."
James Madison, Federalist No. 45, January 26, 1788
January 28, 2009 8:37 PM | Reply | Permalink
I'm a member of Council 5 , A.F.S.C.M.E. , in Minnesota. I worked in Minnesota prisons for 20 years as a Corrections Officer. Because of our negotiated contract I was able to retire at 55. I would challenge anyone to work with "clients" like I did for twenty years and past the age of 55. It's hard working with inmates.
Corrections officers work in very challenging and sometimes depressing environments. Besides the defiant personalities of our "clients" we work amongst many diseases that can be contracted because of our having to work in very close and intimate contact with inmates. I guarantee you that I am not the only Corrections Officer in America who contracted Hepatitis C in a Corrections environment. I probably got it because I was in a union and lazy like BORNEO is referring to.
The truth is Corrections Officers in Minnesota are very committed and courageous in dealing with their job. I just whish that I could take BORNEO into a real prison and walk amongst some of the most dangerous people that you will ever met. Those "lazy" Corrections Officers , all part of a union , would guarantee your safety.
I was able to retire at 55. It's called early retirement because, like the police officers , the reality is that you can only deal with this type of environment for so long; it takes a toll on you that's different then other jobs.
I receive a check from the State of Minnesota and I get my medical paid to Medicare at 65; my wife is also covered. I pay $164.00 a month for my medical coverage and it only went up four dollars this year and it's one of the best medical plans in the country. I earned this negotiated retirement and I feel that it is fair. And when you consider the real price I , and other Corrections Officers , really pay for it it's even more fair then.
I appreciate and thank my union for what they offered and the organizational help that they gave to our group of American employees; we would have never been treated fairly without the Union. Does this story sound like Socialism? What do ya think BORNEO.
January 28, 2009 6:48 PM | Reply | Permalink
Mr. R, I am a big union guy from a big union state and dying union town – Detroit. If unionism was so great for everyone how do you explain the state of Michigan, and more importantly, the City of Detroit? If you know how to fix Detroit then I would appreciate any advice you can give us.
January 28, 2009 9:05 PM | Reply | Permalink
You may have missed this very long comment way above yours, but it's a fascinating analysis of unions in the context of our national history and the way they function elsewhere:
http://tpmcafe.talkingpointsmemo.com/talk/blogs/robert_reich/2009/01/why-we-need-stronger-unions-an.php#comment-3354827
January 29, 2009 12:09 AM | Reply | Permalink
Detroit had Coleman Young, Lodge, Hoffa - all the big names and big companies. We still have all the big name Democrats like Levin, Granholm, & Dingell but where is Detroit? Right at the bottom sucking wind. Everyone in Michigan is the same - BROKE
January 29, 2009 7:48 PM | Reply | Permalink