Nel's New Day

September 7, 2015

Good News, Bad News from Labor Day, 2015

Republicans love to blame the Democrats for destroying the coal industry, but conservatives are the people who decimated the economy in the South through their eradication of the unions. For a century, union organizers were shot, beaten, and stabbed in their fight to get reasonable pay and safe conditions underground, but now the last union mine in Kentucky has been closed. Younger workers took their wages for granted, and now not one working miner belongs to a union, the only protection that mine workers have had.

Conservatives curse the unions but fail to realize that they are responsible for the rise of the middle class.

union_density_middleclass 2

union_density_inequality 1

High income inequality has correlated with low union membership for over 100 years in the U.S. As union membership shrinks, money and power shift upwards. Data from 2010 show that all workers make more money in a pro-union state.

workers do better

Today is Labor Day, established as a federal holiday 121 years ago to celebrate labor. Oregon declared it a holiday 17 years earlier. If you have today off, thank unions. If you are working today, thank unions for other benefits such as shorter work weeks, weekends off, expanded health care through employer-provided health insurance, and the end of child labor except within religious groups. Unions also brought paid vacation, breaks, sick leave, Social Security, overtime pay, worker’s compensation, and more. If you don’t have these benefits, thank the Republicans.

In some states, union attacks brought “right-to-work” laws, which block collective bargaining for higher wages, better benefits, and protections. The “freedom” created by these laws gives corporations and the wealthy the “right-to-underpay” and “right-to-cheat” employees. In Wisconsin, the latest state to adopt this law, “right-to-work” will cause workers and families to annually lose between $3.89 billion and $4.82 billion. Workers in “right-to-work” states make $1,560 less per year than in states without the law. Women in union jobs earn $212 per week—30.9 percent—more than women in non-union jobs. The gender wage gap is also smaller for women in unions, 88.7 cents for every dollar a man makes compared to 78 cents for all workers. Men in union jobs make $173 more per week than non-union workers.

President Obama celebrated this year’s Labor Day by mandating all 300,000 government contractor employees be granted seven paid sick days per year starting in 2017. That leaves another 44 million workers without paid sick leave because the United States is the only developed nation without a paid sick leave policy. The president’s executive order adds to other orders that move toward higher minimum wage and equal pay for men and women.

Other good news comes from the job market. Republicans swore to bring jobs back when they were elected in masses, but they’ve done nothing to help workers. GOP presidential candidate Mitt Romney said he would reduce the unemployment rate to 6 percent by 2016 if he were elected in 2012. Right now, it’s 5.1 percent after 66 consecutive months of private sector job growth—13 million jobs—during President Obama’s six and a half years in office. Many of these jobs came from the health care job growth after Republicans called the ACA the “job killing health care law.”

The bad news comes from the loss of wages for everyone except the top echelon. Oregon is an example of this: in the past 35 years, the bottom income bracket has lost 30 percent of income in the state while the top 1 percent gained 88 percent of the income. Republicans refuse to increase the federal minimum wage, one-third lower when adjusted for inflation than in the 1960s. They also consider the Keystone Pipeline bill a “jobs bill” although it employs only 4,200 people for one year while wiping out other permanent jobs by taking over and destroying land. The GOP’s “Hire More Heroes Act” to employ veterans doesn’t count veterans as employees so that companies with more than 50 employees can avoid the ACA mandate to provide health care. Up to one million workers would lose health insurance with the redefinition of “full-time employment” as 40 hours a week in the GOP’s “Save American Workers Act.”

Another piece of bad news is the growing divergence between salary and productivity. During the 25 years prior to 1973, wages and productivity grew together, but between 1973 and 2014, hourly wages went up 8.7, adjusted for inflation, and productivity increased by 72.2 percent. The change is a major reason for the rapidly growing income inequality during the past 40 years as payment for employees went to owners of capital. Workers generate the income but don’t get an increase in hourly pay. The last four years has been worse as worker productivity increased by 21 percent while wages rose only 2 percent.

wages by bracket

Republicans claim to support a “trickle-down” economy but instead push an economy that is “gush-up.” Unregulated free-market capitalism is a “winner-take-all” wealth over the common good, and billionaires buy politicians and design education and health systems to control the bottom 99 percent of people in the United States. The average CEO earns 204 times what average workers earn, and two-thirds of the poor in the United States—68 percent—have jobs.

Hedge fund billionaires are not required to pay their fair share of taxes receive awards yet are praised. For example, John Paulson, noted for “Outstanding Contributions to Society,” got $3.7 billion by conspiring with Goldman Sachs to create risky subprime mortgages. He used other people’s money to bet against his sure-to-fail financial instruments. As U.S. wealth grew from $52 trillion to over $83 trillion between 2007 and 2014, six million more children were forced onto food stamps. Forty percent of households are food-insecure while 40 percent of the food in the United States is wasted.

Despite the decreasing unemployment rate, taxpayers fund the movement of many jobs overseas while technology eliminates others. Kodak once employed 145,000 people to do the same photo processing that Instagram does with 15 workers. Three-fourths of faculty at colleges and universities are now “adjunct” instructors, paid a pittance for part-time work. One-fourth of these teachers, almost 20 percent of college and university faculty, are forced into food stamp or other public assistance programs to survive.

Republicans claim that they want to return to the 1950s, and economically this would benefit almost everyone. In 1956, the GOP platform supported an increase in the minimum wage, an expansion of Social security, adequate coverage for the unemployed, better housing, and health care for all. “Government must have a heart as well as a head” and “America does not prosper unless all Americans prosper” were included in the GOP belief system. According to the GOP platform, “President Eisenhower’s administration brought the highest employment, highest wages, and the highest standard of living ever experience in any country.”

Today’s GOP portrays people on unemployment as leeches, but the GOP of 1956 called for “providing assistance to improve the economic conditions of areas faced with persistent and substantial unemployment.” Republicans in the 1950s also wanted to strengthen “the rights of labor unions” and protect “the right of workers to organize into unions and to bargain collectively.”

In 1954, President Dwight Eisenhower looked forward to today’s GOP when he wrote:

“Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are…a few…Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid.”

He may have been right.

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