Monday, September 5, 2011

Labor Day 2011

Today is Labor Day, and it's always been one of those funny little "second tier" holidays like Presidents' Day or Columbus Day that people feel obligated to take notice of, but if for some reason it would go away, no one would care a whole lot. Get rid of Christmas or Thanksgiving and yeah, people would go nuts. But Labor Day, not so much.

Originally created to honor the hard work and contributions of workers, Labor Day started off with good intentions but seems to have gotten derailed somewhere along the way. Maybe they needed some kind of holiday to mark the end of summer, something to break up the monotony of the long stretch between Independence Day and Halloween. I think that's how most people view Labor Day, as the end of the summer season. We should be so lucky here in Phoenix, because summer is still in full force for at least another month, maybe longer. The old-timers around here will tell you it doesn't really cool off until the end of October, and after 18 years I can vouch for that.

The connection of Labor Day to actual labor is diminishing, reflecting the fading influence of labor on the national scene. Time was, back in the day, when 25% of American workers were in some kind of union. Now it's very much less. When I was young my father was an officer in the local Steelworkers' Union and it was always a big deal. They wielded political clout and a lot of power. When they spoke, politicians listened. Pundits are always bemoaning the fact that America doesn't "make anything" anymore, that we've moved from a manufacturing economy to a service economy. It's true that the unions have suffered, because making cars and steel carries a lot more influence than nursing or waiting tables.

Now, the unions are being attacked from all sides. Governors in a number of states - Wisconsin and Ohio to name a few - are actively and blatantly going after the public worker unions and stripping them of their collective bargaining rights. Candidates for the highest office in the land criticize and bad-mouth unions as being behind-the-times at best and greedy bloodsuckers at worst. How did this major change in perception happen over just a couple of decades?

First of all, times have changed, a lot. Unions were powerful back in the 70s and 80s and negotiated some very lucrative contracts for their members in many fields of work. In particular, public workers in major American cities got some very cushy deals regarding salaries, pensions and benefits. During boom times, that is not perceived as excessive or out of line. These labor contracts got locked in at high rates and were rarely adjusted downward. Now, with the economy in the tank and money a great deal tighter than ever, the labor contracts are viewed as insane, greedy and excessive.

Another thing is that decades ago, many unions negotiated full health care benefits for their members and retirees. These days, health care costs are through the roof and these full benefits have become a severe and substantial drain on the resources of the companies who must pay them. Companies are just no longer able to provide full health care benefits for everyone who does or used to work for them. Just today, the news had a story of the U.S. Postal Service drifting toward insolvency, and if Congress does not do something to help they will default on some of their obligations by the end of this month. The Postal Service is running an annual deficit of over $9 billion, and they have a $5.5 billion payment for retiree benefits due soon which they do not have the cash to cover. To be sure, a lot of the Postal Services woes are because of reduced revenue due to the overwhelming popularity of email and online shopping, but they said that unless they are able to curtail some of their services (such as Saturday delivery), close literally thousands of small-town post offices across the country and make changes to retiree benefits, which the Postal Service Employees Union will frown upon, the Postal Service will be broke very soon.

To be sure, unions are at least partially to blame for this seismic shift in public opinion. Everybody became aware of union workers who could not be fired no matter how incompetent they were. They got very liberal pay and vacation benefits for their members, usually unmatched by the private sector, and they fought back ferociously if anyone tried to adjust these benefits to fit changing financial realities. Unions were gradually perceived as bloated, overreaching and standing in the way of progress.

A cultural shift occurred in the 1980s which proposed that if earning a fair amount of profit was a good thing, then earning a huge amount of profit was a better thing. This shift was encapsulated in the famous line from the 1987 movie "Wall Street," when iconic character Gordon Gekko delivered his famous line, "Greed ... is good!" Stockholders put pressure on major corporations to show enormous profits all the time. Something that corporations had to do to achieve this was to reduce costs and overhead, and one of the biggest, fastest rising costs was labor. Unions were perceived as standing in the way of reducing labor costs and subsequently, higher profits.

More recently the surge in outsourcing meant the same amount of work could be done by offshore workers who worked for a small fraction of what American workers were paid and cost the corporations nothing in terms of expensive benefits. Unions were caught asleep at the switch when outsourcing became prevalent and found themselves pretty much powerless when it came to staunching the critical hemorrhage of jobs overseas.

Throw into this toxic witches' brew of rising costs and changing times, the political climate in this country has shifted far to the right in the past decade. A number of states, particularly those in the South, have always been antagonistic to unions and have declared themselves as "right to work" states, curtailing the power of the unions to organize employees. Republicans and their obnoxious little lap dogs the Tea Party have managed to increase their hold on government at every level, from local school boards to the House of Representatives. Unions have long been strong supporters and financial backers of the Democrats, and have thus come under unrelenting, merciless attack by the Republicans. Cripple the unions and you cripple the Democrats, the Republicans reason. Hurt the unions, and turn off the money spigot to the Dems. Amazingly, this line of action, coupled with completely idiotic and spineless moves by the Obama administration, seems to be working.

Political bickering aside, getting rid of the unions would be a really bad thing to do. Unions have always been an opposing force, a check-and-balance system against the greed and avarice of Corporate America. Corporations make no effort to hide the fact that they choose profit over the best interests of their workers. The unions were a counterbalance to this, advocating the good of the worker over the singular pursuit of profit. Just the way that divided government used to ensure that neither political party would gain too much power and go off the deep end, unions served to be defenders of the interests of the middle class. But now that the middle class is being marginalized into extinction, and the majority of this country's wealth gets concentrated in the top 1% of the population, unions are finding it very difficult indeed to stand against greedy, rampaging corporations.

So this Labor Day finds the state of unionization in the country to be deeply in peril. A hostile and very polarized political climate, weak economy and out of control health care costs, have conspired with the unions' own bloated and anachronistic sensibilities to sap them of almost all of their political and bargaining powers. If the unions do essentially disappear from the scene, which is completely possible, then the corporations and the wealthy will indeed have won, and it will be a very bad thing for the people in this country who don't make over a million dollars a year.

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