On September 4, 2017 Sharon Block writes on Newsweek:
Labor law in our country is profoundly broken.
The National Labor Relations Act is the federal statute that protects the right of employees to join a union, engage in collective bargaining or just stand together with coworkers to have a say in what happens at work.
Congress passed the law in 1935 to “ encourage collective bargaining.” But the NLRA is failing to fulfill this purpose.
Its failure can be summed up in one surprising statistic : the percentage of American workers who are members of unions is lower now than before the NLRA passed.
Think about that; workers were more likely to be union members (13.2 percent) when they had no right to do so than they are now (10.7 percent) after more than 80 years of having a federally protected right.
This decline is having a dramatic effect on all American workers – because the decline in union density suppresses wages for all workers, it accounts for about one-third of income inequalityover the past several decades.
The NLRA needs a major overhaul. Recent efforts to amend it have been more in the category of tinkering with than rewriting the rules.
The last major effort to amend the NLRA came at the beginning of the Obama Administration with a push to pass the Employee Free Choice Act, a bill which would have changed how workers choose a union but that left the basic structure of the law intact.
Looking back on it, EFCA was the legal equivalent of bringing a knife to an Uzi fight.
I don’t come to this conclusion easily. During the EFCA fight, I worked for Senator Edward M. Kennedy, who led the ultimately unsuccessful legislative battle for the bill. But changes in the American economy and the growing willingness of employers to flout the law dictate that we now look for bigger, bolder solutions.
One big way to change labor law would be to allow states and even cities to enact their own rules for the future of the labor movement.
As it stands now, the NLRA bars – or in legal jargon “ pre-empts ” – any state or local law that even arguably affects the rights covered by federal law.
For example, the Supreme Court in 2008 invalidated a California law that prevented employers from using state money, such as proceeds from government contracts, to pay for anti-union campaigns. The Court found that the state statute reflected a different judgment about the right of employers to speak out against unions than that embodied in the NLRA.
The debate over preemption can sound a lot like having an argument over whether that classic optical illusion is two faces or a vase. Some people see preemption as a floor that prevents states dominated by opponents of unions from further degrading workers’ rights and others see it as a ceiling that condemns any efforts at reform to either political impossibility or some inadequate, lowest-common-denominator outcome.
This debate has heated up as we have seen exciting innovations in other areas of worker rights where there is no federal preemption, such as the first-in-the-nation fair scheduling law in Oregonand the $15 minimum wage wave across the country.
I don’t know the answer to whether or not we should do away with preemption. But I do know that we can’t be afraid to have that debate. That’s why we’ve invited leading scholars, union leaders, worker advocates and others who care about worker rights to Harvard Law School later this month to dive into this discussion.
To give us ideas about the realm of the possible in a world without preemption, we will look at experiments already underway at the state and local level to reimagine collective bargaining rights for workers who are not covered by the NLRA and therefore outside the constraints of preemption.
But to keep in mind what the risks are, we also will look at how state legislatures in primarily red states are waging vicious attacks on workers’ rights, such as the effort in a number of states to block minimum wage increases at the city level, including in St. Louis and Birmingham and the evisceration of collective bargaining rights for public sector workers in a number of states since the recession.
Anyone who cares about the continuing viability of the middle class should care that we fix the law to empower workers because history teaches us that a healthy labor movement is essential to the existence of a healthy middle class.
As the percentage of American workers who belong to unions has plummeted, so has the middle class share of our national income. Under current law, the labor movement is not healthy; it is in critical condition.
Thus, it is time to do the hard work of figuring out what the next generation of labor law reform should be, including asking the hard question “to preempt or not to preempt.”
Gary Reber Comments:
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. 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.”
Historically and in its present form, the labor movement is destructive in that it agrees with the idea that propertyless people should exist to serve those who own property. The labor movement doesn’t seek to end wage slavery; it merely seeks to improve the condition of the wage slave. If it actually cared about human rights and freedom, it wouldn’t call itself the “labor movement.”
Binary economist Louis O. 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 capital credit so that they can purchase the employer’s stock, pay for it in pre-tax dollars out of the new assets that underlie that stock, and after the stock is paid for earn and collect the capital earnings income from it, and accumulate it in a tax haven until they retire, whereby they continue to be productive capital earners receiving income from their capital asset 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.
