America Is Growing Fast And Workers Are Demanding Their Share
Many years ago I took a Canadian contingent of ‘connected vehicle’ experts on a field trip to Clemson University ; it included a tour of the nearby VW factory in Chattanooga, TN. The plant was huge and spotless, robots were swinging giant arms overhead, and when workers took their breaks, they ate with managers.
That was revolutionary in North America: the workers and managers chatted with one another and shared their experiences.
Just last week, these same workers voted overwhelmingly to join the United Autoworkers Union.
And their management felt that they had earned the right to do that. Its push-back against the union was mild; it said it left the decision to the workers.
Those managers are smarter than their politicians; the governors in six southern states warned workers that joining the union could cost them their jobs and threaten the region’s economic progress. The UAW is already at two Ford and two GM plants in the south, and nothing dire has happened, so their warning lacks credibility.
Further, their warning lacks any economic sense. The governors are Republicans. Perhaps I repeated myself there. But paying people more means that local incomes rise. The southern states are the poorest in America because they pay poorly, have low-class education and minimal social support programs.
In fact, if we could recapture the days when unions were strong, America would grown even faster.
In an excellent article called “The Rebirth of American Labor”, Robert Reich points out that we have had more than four decades of near flat wages, even though the United States economy is now more than three times the size it was four decades ago. The middle class has continued to shrink. Most of the economic gains went to the top.
Workers were hit with “right to work” legislation (read: right to be exploited for less) while Wall Street was deregulated (right to be rich) and the rich had the freedom to bring America to its knees with frantic profit-seeking which cost millions their jobs and homes but left the rich even richer.
“Corporate raiders got the right to mount hostile takeovers of companies and then demand bigger profits,” writes Reich. “And since payrolls comprise about two-thirds of corporate costs, the raiders forced corporations to limit wages and benefits.
“To achieve this, corporations sought to bust unions — outsourcing jobs abroad and moving to “right-to-work-for-less” states. They also illegally fired workers who tried to organize…With this decline came a shrinkage of the American middle class. It’s estimated that between 1979 and 2017, the typical U.S. worker lost out on $3,250 in pay every year due to the decline of unions.”
In their heyday, from the 1950’s to the 1970’s, one-third of all workers were unionized and hundreds of strikes each year showed their power. In the past forty years, the number of strikes has dropped to a few dozen per year.
But now the unions are coming back, and their power is showing. New contracts provide significant pay increases and more job security. Last year they provided significant first-year pay increases of 7.3% - a record high. They also built in more job security.
Some 70 percent of Americans now support unions, according to Gallup, up from about 50 percent a decade and a half ago. Filings for union elections were up 35 percent in the six months. Conversely, trust in business is at a corresponding low.
Reich speculates that the pandemic may have been partially responsible, spotlighting how easy it is for the rich to keep getting richer while everyone else treads water or goes under. Perhaps not coincidently, Biden is the most pro-union president in decades.
Corporate union-busting efforts continue, but they face an upsurge in the number of non-union workers who want to have a union at their work-place.
The Volkswagen vote to join the United Auto Workers union, for example, might trigger the union’s growth in other auto manufacturers throughout the South, which is the least unionized region of the country. Not unrelated, it is also the poorest region in the country.
The next test will come in mid-May with a vote at a Mercedes-Benz plant in Alabama. And at least 30 percent of workers have signed cards authorizing the U.A.W. to represent them at a Hyundai plant in Alabama and a Toyota plant in Missouri, according to the NYT. The union has yet to petition for representation in either place, but good wage raises in Chattanooga could push acceptance quickly.
Employees in other plants in diverse industries will be leaning forward as well, as the news spreads through social media. Successful campaigns at companies like Starbucks, Amazon and Apple are other positive indicators.
Unions have been necessary for American prosperity, because they force the wealth-owners to share the fruit of their labor.
In the fifty years of relatively strong union presence, the wealth of the top 10% was held down; when unions dropped, the wealth balloon soared. The decline of unionism corresponded with a shrinkage in the middle class and a rise in the lower-income ranks.
Children with unionized parents end up with better earnings, higher educational attainment, and fewer health issues than those without.
The spill-over effect of unions is huge: the effect of unionism shows up in higher incomes for all children from a union area regardless of the union status of their parents.
The businesses in the south may not want to share their wealth, and their puppets in the governors’ mansions nod their heads, but overall everyone is better off.
A growing economy does no good for the nation if it only grows the bank assets of a few wealthy people – people, I never tire of pointing out, who largely do not deserve their wealth.
Strong unions help grow the economy by reducing inequality and raising incomes. The historic recent rise union activity has led to a growth in real wages and a decline in inequality.
All this has helped push the US to the top of the global economic growth charts.
It will be only with even more unionism that we will see that growth continue to push upward! The next big marker will be the mid-May vote at the Mercedes plant…