I'm sure my many Republican friends on this email list are going to take issue with my thoughts in this email, but that's OK -- we can agree on school reform but will probably have to agree to disagree on a lot of other things.
Once upon a time, back when America had a strong middle class, it also had a strong union movement.
These two facts were connected. Unions negotiated good wages and benefits for their workers, gains that often ended up being matched even by nonunion employers. They also provided an important counterbalance to the political influence of corporations and the economic elite.
Today, however, the American union movement is a shadow of its former self, except among government workers. In 1973, almost a quarter of private-sector employees were union members, but last year the figure was down to a mere 7.4 percent.
Yet unions still matter politically. And right now they’re at the heart of a nasty political scuffle among Democrats. Before I get to that, however, let’s talk about what happened to American labor over the last 35 years.
It’s often assumed that the U.S. labor movement died a natural death, that it was made obsolete by globalization and technological change. But what really happened is that beginning in the 1970s, corporate America, which had previously had a largely cooperative relationship with unions, in effect declared war on organized labor.
Don’t take my word for it; read Business Week, which published an article in 2002 titled “How Wal-Mart Keeps Unions at Bay.” The article explained that “over the past two decades, Corporate America has perfected its ability to fend off labor groups.” It then described the tactics — some legal, some illegal, all involving a healthy dose of intimidation — that Wal-Mart and other giant firms use to block organizing drives.
These hardball tactics have been enabled by a political environment that has been deeply hostile to organized labor, both because politicians favored employers’ interests and because conservatives sought to weaken the Democratic Party. “We’re going to crush labor as a political entity,” Grover Norquist, the anti-tax activist, once declared.
I think Krugman is right about the reasons for the decline in unions (the most compelling statistics in the book showed that in 1960, the U.S. and Canada had roughly the same percentage of unionized wage and salary workers (30.4% and 32.3%), yet by 1999, the U.S. was at 13.5% vs. 32.6% for Canada) and want to be clear that my criticisms of the teachers unions does not mean I'm anti-union -- though the teachers unions cleverly like to accuse their critics of this. I'm against bad union behavior, but am very supportive of the role unions play in raising wages, protecting workers, providing health care and other benefits, shaming companies that pay CEOs egregious amounts, etc.
I think there needs to be a healthy balance between the power of employers and the power of labor, and I think the pendulum has swung way too far toward the former. I'm looking forward to a Democratic President who can help restore this balance.
More general thoughts on the book:
Krugman traces how the United States went from having huge inequality and a weak middle class from the Gilded Age (1870s-1900) up through the 1920s, then the rise of a strong middle class and relatively low income inequality in the 1950s and 1960s, to a reversion to the 1920s today. He attributes these shifts to government policies, mainly highly progressive taxes and New Deal programs (http://en.wikipedia.org/wiki/New_Deal) that emerged from the Great Depression. He decries the fact that government has been backing away from these policies in the past 20-30 years, driven largely by the rise of the radical right -- what Krugman calls "movement conservatism" (more commonly called neoconservatism: http://en.wikipedia.org/wiki/Neoconservatism).
I think Krugman is right that the rise of extreme income inequality (though I've personally been the beneficiary of it) and the fraying of the safety net is very bad for our country, that it's absurd that I (and many other high-income Americans) pay a lower tax rate than my secretary, and that it's an outrage that the wealthiest country in the world, alone among developed countries, doesn't guarantee basic health health care to its citizens. Despite spending roughly double what any other nation spends on health care, 15% of Americans have no health insurance and one study showed that among "moderate income" Americans ($20-35,000/year), more than 40% were uninsured at some point over a two-year period.
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