If Labor Dies, What's Next?

October 19th, 2012

This election is about many important issues, but one of the most important is the future of American workers and their co-workers around the global village. It is very clear that we must take our future into our own hands, organize, fight for our rights, educate ourselves and the public and get our message across in as many ways as we can. This helps to counteract the daily anti-worker, anti-union message of the corporatacracy.

This article, from the American Prospect, needs to be read and understood by anybody fighting this battle. Just a few paragraphs from this great article are below:

"I. A Union-Free America

Here’s what happens if the dinosaur dies.

When unions vanish, ordinary Americans lose their right to bargain collectively for their pay and benefits. Even those who have never bargained collectively will feel the loss. Some years ago, when unions were big enough that their effect on the larger economy could be measured, Princeton economist Henry Farber concluded that the wages of nonunion workers in industries that were 25 percent unionized were 7.5 percent higher than they’d be if their industry were union-free. When unionized companies were common, firms that were nonunion had to mimic the wages and benefits of their unionized counterparts for fear that their employees would leave or, worse, organize. That was certainly the practice at General Electric and other largely nonunion giants.

Nonetheless, union workers generally maintained a 20 percent wage advantage over nonunion workers. The key to the wage advantage is the percentage of union membership in a given industry or market. In cities where nearly all the class-A hotels are unionized, as they are in New York and San Francisco, housekeepers make more than $20 an hour. In cities where roughly half of such hotels are unionized, such as Los Angeles, their hourly wage is about $15. In cities where all the hotels are nonunion, such as Phoenix, housekeepers make little more than the minimum wage, if that.

From 1947 through 1973, when union density in America was at its peak, real wages for nonmanagerial employees rose by 75 percent. From 1979 through 2006, as union density collapsed, real wages for nonmanagerial employees rose by only 4 percent. Unable to get a raise, American households maintained their standard of living during those years by women entering the workforce and by going into debt.

 Density is just one element of unions’ ability to raise wages, however. The other is strikes. We look back now at the three decades of broadly shared prosperity that followed World War II as a time of union-management concord, when executives made their peace with unions and unions didn’t rock the boat. In fact, more strikes occurred from the late 1940s through the early 1970s than before or since. When union contracts expired, workers and managers fought pitched battles over the terms of the next contract. The largest strike in American history came in 1959, amid the sleepy Eisenhower years, when 500,000 steelworkers stayed off the job for 116 days. It was through such expedients that workers compelled management to let them share in their company’s proceeds. But as density declined, unions’ ability to win strikes declined with it. By the late 1970s and early 1980s, unions were striking less to win raises than to resist management proposals to freeze wages and cut benefits. The weaker unions grew, the fewer their strikes. In the early 1950s, there were roughly 350 strikes in the United States every year. Over the past decade, there have been roughly 10 to 20 per year.

As unions shrank, inequality grew. From 1947 through 1972, productivity in the United States rose by 102 percent, and median household income rose by an identical 102 percent. In recent decades, as economists Robert Gordon and Ian Dew-Becker have shown, all productivity gains have accrued to the wealthiest 10 percent. In 1955, near the apogee of union strength, the wealthiest 10 percent received 33 percent of the nation’s personal income. In 2007, they received 50 percent.

Profits have been growing at wages’ expense. Michael Cembalest, J.P. Morgan’s chief investment officer, has calculated that reductions in wages and benefits were responsible for about 75 percent of the increase in corporate profits between 2000 and 2007.

Today, wages and benefits make up the lowest share of America’s gross domestic product since World War II. Wages have fallen from 53 percent of GDP in 1970 to 44 percent today. Profits have been growing at wages’ expense. Michael Cembalest, J.P. Morgan’s chief investment officer, has calculated that reductions in wages and benefits were responsible for about 75 percent of the increase in corporate profits between 2000 and 2007.

What’s causing this decline in workers’ ability to claim more of the nation’s wealth? It’s not that they’re less productive. According to a Wall Street Journal survey of the S&P 500, the nation’s largest publicly traded companies, revenues per worker, which were $378,000 in 2007, grew to $420,000 in 2010. Businesses now produce more with fewer employees, but even those workers who’ve kept their jobs haven’t seen their wages rise."

There is a reason this is such a slow recovery and neither side is clearly telling the American public why this is so. Without decent union jobs, wages drift lower and lower and it is almost impossible for enough purchasing power to develop to bring this economy back to life. The GOP knows this, but it works just fine for them. The Democrats want to have it both ways - so they never really clearly connect the dots.

Read the whole article here: http://prospect.org/article/if-labor-dies-whats-next