Posts Tagged ‘labor unions’

Honoring Our Workers With a Knife in the Back

Monday, September 6th, 2010

Labor Day may be our most hypocritical holiday in the U.S.

Here is Harold Meyerson on the state of our working class:

Consider: As of this year, U.S. gross domestic product is about 1 percent beneath its 2008 peak, compared to a drop of roughly 2 percent in France and Germany and 5 percent in Britain and Japan. But U.S. unemployment has increased roughly 5 percentage points since 2007, compared to just 1 point in France and Japan and 2 in Britain. In Germany, unemployment has actually dropped a point since the recession began. […]

As Andrew Sum and Joseph McLaughlin of Northeastern University’s Center for Labor Market Studies have documented, pretax corporate profits increased $388 billion from the low point of the current recession, the second quarter of 2009, to the third quarter thereafter, while wages increased just $68 billion. […]

A survey, released Thursday by the Kaiser Family Foundation and the Health Research & Educational Trust, shows that employee premiums rose 13.7 percent over last year, while the amount that employers contributed dropped — dropped! — 0.9 percent.

Only a purblind ideologue could miss the pattern here. American employers — more than employers in other nations and more than American employers in earlier downturns — have imposed the costs of the recession and, increasingly, the costs of doing business, on their workers, and kept for themselves damn near all the proceeds from doing business.

[…]

…the U.S. private sector is almost entirely — 93 percent — nonunion. Unlike European workers, unlike their own parents and grandparents who lived in a much more heavily unionized America, U.S. workers are now powerless to stop their employers from pocketing all the change.

Enjoy your Bar B Q.

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Lessons Unlearned

Monday, August 23rd, 2010

Economics professor Teresa Ghilarducci reports:

The shocking story in this week’s Financial Times had this lead: “Call center workers are becoming as cheap to hire in the U.S. as they are in India.” High unemployment in the U.S. has forced down wages for low-paid workers in the U.S. so that in many cases Americans are cheaper to hire than those in a country where most people live on less than $8.00 per day.

She links this story to another about an ongoing strike at a Dr. Pepper/Snapple factory in upstate New York where workers are attempting to prevent cuts in wages and pensions despite healthy company profits.

Unlike other companies that have gotten drastic pay cuts from union members when they opened their books to prove their economic distress—GM, Ford, Chrysler, Goodyear tire company—Dr Pepper Snapple admits they can afford to pay; but they argue (I imagine some with some smugness) that unemployment is so high that competition between desperate workers will boost profits further as workers accept less pay to get and keep a job.

Of course, if you are a free market fundamentalist you will find nothing wrong with this scenario. Workers deserve only those wages that the market will bear. If an increased supply of labor suppresses wages so be it.

But as Ghilarducci argues:

Falling wages is a bad thing, a very bad thing. Even if you are channeling gilded age Jay Gould—who said, “I can hire half of the working class to kill the other half”—you must concede that if workers don’t buy stuff, there is more unemployment, which means even lower wages, leading to more unemployment, in a spiral downward of recession and depression that eventually means you won’t be able buy stuff, no matter how cheap it is.

The only antidote to downward pressure on wages is a strong union movement. But most Americans hate unions and the power of unions has steadily eroded.

We have been through all of this before. Capitalism nearly destroyed itself in the early 20th Century because the business community refused to pay workers enough to create demand for their products. One of the reforms that helped produce mid-20th Century prosperity was laws that protected the right of workers to organize. But anti-union sentiment and globalization have conspired to take that option off the table.

Will capitalism have to learn the hard way again?

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Posted in Economics, Labor | No Comments »

Behind the Oil Spill Disaster

Thursday, April 29th, 2010

The British Petroleum oil rig that blew up last week, killing 11 workers, is now spreading oil over a massive area in the Gulf of Mexico… “Drill Baby Drill”,one of the campaign slogans from McCain’s presidential campaign, is not looking quite so catchy. It’s too bad Obama caved into oil interests recently and authorized more off shore drilling.

This comes on the heels of the Massey Coal Mine explosion that killed 29 miners a few weeks ago.

What do these two events have in common? Both British Petroleum and Massey Coal were nonunion work sites.

As economist Teresa Ghilarducci writes:

In 2009, four years after a BP explosion in a Texas refinery that killed 15 workers and injured 170, the Occupational Safety and Health administration imposed the largest fine in its history—$87-million on British Petroleum. BP also paid billions in criminal charges and civil claims for the accident: $50-million in criminal fines for violating the Clean Air Act and over 4,000 claims from a $2.1-billion claims fund.

Why does this company still operate in this country? How many more workers does it have to kill?

In my economics classes, I teach the economics of health and safety. The two-minute version has the same conclusion as the two lecture version: If it is cheaper for the company to kill workers than it is to safeguard the workplace so they are not killed, workers will be killed. Unions and hefty government fines would raise the price of killing workers. Both Massey and BP work sites were nonunion. And the rate of unionization in this nation is at a all time low: 7.2 percent.

No other developed nation has a weaker labor movement than the United States and this country kills more workers per year than most.

Even these numbers are suspect. And the United States, unlike other rich countries, does not count fatalities due to occupational disease as a fatality. Seven countries impose safety obligations upon either directors or senior managers of companies—Germany, France, Italy, Sweden, Japan, Canada, and Australia—while the United Sates imposes none.

The U.S. Department of Labor classifies on-the-job fatalities as misdemeanors, even if the employer was negligent by willfully failing to follow OSHA safety standards. The maximum civil penalty OSHA can levy for a safety violation is $70,000,  and the maximum prison sentence for a willful violation of a safety standard that leads to a worker’s death is six months. Six months.

Check out Fair Warning for direct commentary on corporate health and safety practices.

These workplace fatalities are not accidents of nature; they are caused by the Congress’s and the president’s failure to regulate and protect workers who attempt to unionize

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Posted in Environmental Issues, Labor | 11 Comments »