There is power in a union. Photo: Justin Sullivan/Getty Images
On January 26, 2018, Eric Levitz writes in New York Magazine:
The GOP understands how important labor unions are to the Democratic Party. The Democratic Party, historically, has not. If you want a two-sentence explanation for why the Midwest is turning red (and thus, why Donald Trump is president), you could do worse than that.
With its financial contributions and grassroots organizing, the labor movement helped give Democrats full control of the federal government three times in the last four decades. And all three of those times — under Jimmy Carter, Bill Clinton, and Barack Obama — Democrats failed to pass labor law reforms that would to bolster the union cause. In hindsight, it’s clear that the Democratic Party didn’t merely betray organized labor with these failures, but also, itself.
Between 1978 and 2017, the union membership rate in the United States fell by more than half — from 26 to 10.7 percent. Some of this decline probably couldn’t have been averted — or, at least, not by changes in labor law alone. The combination of resurgent economies in Europe and Japan, the United States’ decidedly non-protectionist trade policies, and technological advances in shipping was bound to do a number on American unions. Global competition thinned profit margins for U.S. firms; cutting labor costs was one of the easiest ways to fatten ’em back up; and breaking unions (through persuasion, intimidation, or relocation) was one of the easiest ways to cut said costs.
Nevertheless, there was lot that Democrats could have done — through labor law reform — to shelter the union movement from these changes, and help it establish a bigger footprint in the service sector. At present, employers are prohibited from firing workers for organizing or threatening to close businesses if workers unionize — but the penalties for such violations are negligible. Further, while they must recognize unions once they are ratified by workers in an election, employers can delay those elections for months or even years — and, even after recognition, face no obligation to reach a contract with their newly unionized workers.
Democrats could have increased the penalties for violating labor law, enabled unions to circumvent the election process if a majority of workers signed union cards (a.k.a. “card check”), and required employers to enter arbitration with unions if no contract was reached within 120 days of their formation — as Barack Obama promised the labor movement they would, in 2008.
Or, if they were feeling a bit more radical, they could have repealed the part of the Taft-Hartley Act that allows conservatives states to pass “right to work” laws. Such laws undermine organized labor by allowing workers who join a unionized workplace to enjoy the benefits of a collective bargaining agreement without paying dues to the union that negotiated it. This encourages other workers to skirt their dues, which can then drain a union of the funds it needs to survive.
And that has the effect of draining the Democratic Party of the funds — and grassroots organizing — that it needs to thrive. As Sean McElwee writes for The Nation:
“In a new study that will soon be released as a National Bureau of Economic Research working paper, James Feigenbaum of Boston University, Alexander Hertel-Fernandez of Columbia, and Vanessa Williamson of the Brookings Institution examined the long-term political consequences of anti-union legislation by comparing counties straddling a state line where one state is right-to-work and another is not. Their findings should strike terror into the hearts of Democratic Party strategists: Right-to-work laws decreased Democratic presidential vote share by 3.5 percent.
The study found that impacts persist in down-ballot races, and have given Republicans more power in the Senate, House, and governors’ mansions, as well as in state legislatures. This leads to a vicious cycle wherein the GOP can use that power to further suppress votes, gut union rights, and gerrymander legislatures—in other words, embark on a fundamental retooling of American political mechanics.
The decimation of the blue wall in 2016 may have been driven by Trump’s unique candidacy, but right-to-work laws had been weakening the foundation for years. In 2014, Republican Governor Rick Snyder’s narrow victory against Democratic opponent Mark Schauer may well have gone in a different direction were it not for the state’s 2012 right-to-work law. It’s not impossible to imagine that progressive Senate candidate Russ Feingold would have beaten Tea Party–backed incumbent Ron Johnson in 2016 if only Wisconsin private- and public-sector unions had not been completely gutted. The effect of right-to-work laws, according to this research, are large enough that it could have easily cost Hillary Clinton Wisconsin and Michigan—two states that went right-to-work before the 2016 elections.”
These findings will surprise no one in the Republican leadership. Since 2010, six GOP state governments have passed “right to work” laws. Last year, Kentucky and Missouri joined the club (the latter development will make Senator Claire McCaskill’s already difficult reelection bid all the more challenging). Republicans prioritized these regressive labor law reforms because they understood how devastating they would be for the unions — and thus, to the Democratic Party. Last year, anti-tax crusader Grover Norquist argued that if right-to-work reforms are “enacted in a dozen more states, the modern Democratic Party will cease to be a competitive power in American politics.”
This could have been a golden age for American liberalism. The Democratic Party — and the progressive forces within it — have so much going for them. The GOP’s economic vision has never been less popular with ordinary Americans, or more irrelevant to their material needs. The U.S. electorate is becoming less white, less racist, and less conservative with each passing year. Social conservatism has never had less appeal for American voters than it does today. The garish spectacle of the Trump-era Republican Party is turning the American suburbs — once a core part of the GOP coalition — purple and blue.
If the Democratic Party wasn’t bleeding support from white working-class voters in its old labor strongholds, it would dominate our national politics. Understandably, Democratic partisans often blame their powerlessness on such voters — and the regressive racial views that led them out of Team Blue’s tent. But as unions have declined across the Midwest, Democrats haven’t just been losing white, working-class voters to revanchist Republicans — they’ve also been losing them to quiet evenings at home. The NBER study cited by McElwee found that right-to-work laws reduce voter turnout in presidential elections by 2 to 3 percent.
Further, the notion that grassroots organizing cannot make a non-woke white man prioritize his class interests over his racial resentments — and thus, that the Democratic Party’s refusal to bolster union organizing was irrelevant to its failure to fend off Trump — is unsupportable. In 2008, labor invested a quarter-billion dollars into Barack Obama’s election, allocating the bulk of those funds into burnishing the candidate’s support among union voters in the Midwest. That year, unionized white men backed Obama by an 18 percent margin; while nonunionized ones went for John McCain by 16.
If right-to-work laws alone cost Democrats roughly 3.5 percent of a given state’s vote share, how many votes has the party lost since 1978 by refusing to prioritize progressive labor reforms?
What kind of country would we live in today, if they hadn’t?
Gary Reber Comments:
Worker and political action is required to form a new vision for a labor union movement,
The labor union movement should transform to a producers’ ownership union movement and embrace and fight for this new democratic capitalism. They should play the part that they have always aspired to — that is, a better and easier life through participation in the nation’s economic growth and progress. As a result, labor unions will be able to broaden their functions, revitalize their constituency, and reverse their decline.
Unfortunately, at the present time the movement is built on one-factor economics — the labor worker. The insufficiency of labor worker earnings to purchase increasingly capital-produced products and services gave rise to labor laws and labor unions designed to coerce higher and higher prices for the same or reduced labor input. With government assistance, unions have gradually converted productive enterprises in the private and public sectors into welfare institutions. Binary economist Louis Kelso stated: “The myth of the ‘rising productivity’ of labor is used to conceal the increasing productiveness of capital and the decreasing productiveness of labor, and to disguise income redistribution by making it seem morally acceptable.”
Kelso argued that unions “must adopt a sound strategy that conforms to the economic facts of life. If under free-market conditions, 90 percent of the goods and services are produced by capital input, then 90 percent of the earnings of working people must flow to them as wages of their capital and the remainder as wages of their labor work… If there are in reality two ways for people to participate in production and earn income, then tomorrow’s producers’ union must take cognizance of both… The question is only whether the labor union will help lead this movement or, refusing to learn, to change, and to innovate, become irrelevant.”
Unions are the only group of people in the whole world who can demand a real Kelso-designed ESOP, who can demand the right to participate in the expansion of their employer by asserting their constitutional preferential rights to become capital owners, be productive, and succeed. The ESOP can give employees access to credit so that they can purchase the employer’s stock, pay for it in pre-tax dollars out of the assets that underlie that stock, and after the stock is paid for earn and collect the capital worker income from it, and accumulate it in a tax haven until they retire, whereby they continue to be capital workers receiving income from their capital ownership stakes. This is a viable route to individual self-sufficiency needing significantly less or no government redistributive assistance.
The unions should reassess their role of bargaining for more and more income for the same work or less and less work, and embrace a cooperative approach to survival, whereby they redefine “more” income for their workers in terms of the combined wages of labor and capital on the part of the workforce. They should continue to represent the workers as labor workers in all the aspects that are represented today — wages, hours, and working conditions — and, in addition, represent workers as full voting stockowners as capital ownership is built into the workforce. What is needed is leadership to define “more” as two ways to earn income.
If we continue with the past’s unworkable trickle-down economic policies, governments will have to continue to use the coercive power of taxation to redistribute income that is made by people who earn it and give it to those who need it. This results in ever deepening massive debt on local, state, and national government levels, which leads to the citizenry becoming parasites instead of enabling people to become productive in the way that products and services are actually produced.
When labor unions transform to producers’ ownership unions, opportunity will be created for the unions to reach out to all shareholders (stock owners) who are not adequately represented on corporate boards, and eventually all labor workers will want to join an ownership union in order to be effectively represented as an aspiring capital owner. The overall strategy should assure that the labor compensation of the union’s members does not exceed the labor costs of the employer’s competitors, and that capital earnings of its members are built up to a level that optimizes their combined labor-capital worker earnings. A producers’ ownership union would work collaboratively with management to secure financing of advanced technologies and other new capital investments and broaden ownership. This will enable American companies to become more cost-competitive in global markets and to reduce the outsourcing of jobs to workers willing or forced to take lower wages.
Kelso stated, “Working conditions for the labor force have, of course, improved over the years. But the economic quality of life for the majority of Americans has trailed far behind the technical capabilities of the economy to produce creature comforts, and even further behind the desires of consumers to live economically better lives. The missing link is that most of those unproduced goods and services can be produced only through capital, and the people who need them have no opportunity to earn income from capital ownership.”
Walter Reuther, President of the United Auto Workers, expressed his open-mindedness to the goal of democratic worker ownership in his 1967 testimony to the Joint Economic Committee of Congress as a strategy for saving manufacturing jobs in America from being outcompeted by Japan and eventual outsourcing to other Asian countries with far lower wage costs: “Profit sharing in the form of stock distributions to workers would help to democratize the ownership of America’s vast corporate wealth, which is today appallingly undemocratic and unhealthy.
“If workers had definite assurance of equitable shares in the profits of the corporations that employ them, they would see less need to seek an equitable balance between their gains and soaring profits through augmented increases in basic wage rates. This would be a desirable result from the standpoint of stabilization policy because profit sharing does not increase costs. Since profits are a residual, after all costs have been met, and since their size is not determinable until after customers have paid the prices charged for the firm’s products, profit sharing [through wider share ownership] cannot be said to have any inflationary impact on costs and prices.”
Unfortunately for democratic unionism, the United Auto Workers, American manufacturing workers, and American citizens generally, Reuther was killed in an airplane crash in 1970 before his idea was implemented. Leonard Woodcock, his successor, nor any subsequent union leader never followed through.
The union movement should also expand beyond representing corporate employees and represent capital ownership empowerment for all propertyless citizens.
