economics as if workers mattered
Tag Archives: class warfare
A golden age for workers?
The front page of the Sept. 20 New York Times Business Day section has headlines suggesting workers are doing well, but when you read the stories things look quite different.
Eduardo Porter’s column headline trumpets “Labor Shortage Gives Workers an Edge.” It takes him until the fourth graf to tell us that average hourly pay for production and nonsupervisory workers has almost reached 1973 levels (after adjusting for inflation). Less, of course, after 44 years of speed-up, but close. Of course, that doesn’t take account of lost benefits. We’re paying a lot more out of pocket for our health care. Time off is harder to get. Pension plans are but a distant memory. And right next door, “Cost of Employer-Based Plans Remains Stable, a Study Finds.”
Good news, right? Well, it’s good news for the bosses. Average premiums for family coverage are up 3 percent, to $18,764 a year. The cost is rising faster than wages, and far fewer small employers are offering health benefits at all. Out-of-pocket costs are higher, as employers switch to insurance companies that restrict access to doctors and hospitals. But “deductibles rose only slightly this year.” Why? “Companies are recognizing that they have reached the limits of what they can ask their workers to pay, said Michael Thompson, the chief executive of the National alliance of Healthcare Purchaser Coalitions, which represents employers. ‘We’re running out of runway to keep cosh-shifting to employees,’ he said.”
But at least we’re seeing the promise of new jobs? Same page’s “A Manufacturing Model Tough to Export” notes that FoxConn, which is promising 13,000 new jobs in Wisconsin, has a history of breaking such promises once it gets its government hand-outs.
In Brazil, FoxConn promised nearly 100,000 jobs in exchange for billions in subsidies. Six years later, the plant site sits empty – only 2,800 jobs ever materialized. In Pennsylvania, FoxConn promised to hire 500 workers in a $30 million plant it has yet to break ground on.
Wisconsin officials have promised $3 billion in tax breaks and other subsidies. If FoxConn hires all the workers it promises, it would take until 2042 before the state could hope to recoup its money. (Of course, the deal would have run out by then, and so FoxConn would have long since demanded more payments.)
Back to the looming labor shortage. Employers profess to be worried that they’re going to run out of workers (though there are tens of millions of folks frozen out of the labor market – far more than the jobs employers say they can’t fill). The Times quote “experts” who suggest slashing disability benefits, expanding government assistance for workers paid so little they can’t afford childcare or rent, and holding down the minimum wage because higher wages “could price some workers out of jobs” even in the face of the “looming labor shortage” the column is fretting about.
Over in Arts, the same issue reviews a book, Nomadland, about tens of thousands of older workers forced to trade in their homes for vans and old school buses, traveling from part-time job to part-time job – sometimes working for little more than a place to park their vehicles. Their ranks include “retired” teachers and aged-out software engineers. Amazon hires lots of these desperate workers, getting federal tax credits for 25 to 40 percent of the paltry wages it pays them for working in dangerous sweatshops where the company distributes free painkills to keep them working as long, and as fast, as possible.
Too many still look to “national liberation” struggles (as if some unitary “nation” exists, rather than exploiters and exploited, oppressors and oppressed) or reforms within the system. In South Africa we can see every day the folly of trusting those who would act in our behalf, or who seek to accommodate our urgent needs to the constraints of the system.
“The struggle of the black working class majority of Freedom Park, South Africa, is not just for land on which to build housing – although that is obviously a central issue and key demand; nor is it just against the accompanying political and police violence and intimidation. It is a struggle against the injustice, violence and corruption of a system that puts the power, privileges and profits of a few before the lives and wellbeing of the majority.” (click on the link below for the full report)
The New York Times’ resident liberal economics columnist, Paul Krugman, illustrated in his Monday column why the Democrats have little hope of persuading the Trump voters – and, more importantly, the tens of millions who refused to vote for either candidate – that they have any understanding of the lives of working people, let alone any ideas of how to improve them.
Krugman takes understandable exception to the Trumpster’s long litany of lies, about the empty stands at his inauguration, the epidemic of crime allegedly sweeping our country (Trump is of course not referring to his refusal to pay his workers, his fraudulent University, and the like), etc. Then Krugman gets to the point:
Listening to Mr. Trump, you might have thought America was in the midst of a full-scale depression, with ‘rusted-out factories scattered like tombstones across the landscape of our nation.’ Manufacturing employment is indeed down since 2000, but overall employment is way up, and the unemployment rate is low…
And it’s not just one number that looks pretty good. Rising wages and the growing number of Americans confident enough to quit their jobs suggest an economy close to full employment…
And perhaps they do, to an economist so mired in mainstream thinking that he can not look out the window at the real lives of working people.
The unemployment rate is indeed down (officially 4.7%, which economists – who draw healthy pay checks opining about such things – consider full employment, even though it means tens of millions are deprived of access to the necessities of life); but primarily because the job market is so dismal that huge numbers of people have given up looking for work. This is particularly the case in industrial and mining regions, where finding work often means scrambling for part-time hours in a minimum wage job that won’t bring in enough to put food on the table (not that these workers can afford a table, or a house to put it in).
Employers claim they’re having trouble finding “qualified” workers. This is partly a reflection of computer screening programs that reject people with too much experience, but also those with not enough; if a resume’s language doesn’t exactly match the criteria some coder who never worked the job put in, into the discard pile it goes. And of course anyone accustomed to earning a living wage with benefits won’t get a second look. But it also reflects a fundamental shift in how employers hire. A few decades ago, they figured they’d hold onto workers for several years, and so were willing to invest a few days or a few weeks training them to do the work. But now, workers are disposable; hired by the gig, or the shift, or the week. So the bosses want them to be ready to be 100% productive the instant they step on the shop floor (and, of course, to squeeze extra productivity out of them by making them work off the clock, do the work of 3 or 4 people, etc.)
If there were jobs on offer at which it was possible to earn a living, there are millions and millions of workers who would jump at them. Ironically, offering such jobs would cause the unemployment rate to skyrocket. More people would have jobs, of course, but this hint of prosperity would encourage others to look for work, like the former student I bumped in today who graduated college eight months ago but figures there’s no point looking for work – in part because he (not incorrectly) believes there’s no good jobs out there, and in part because he’s trying to get a criminal conviction off his record so that he has a shot of getting past the application screening to an interview.
Krugman says things are likely to get worse – much worse – before they get better, and absent a lot of organization and struggle he’s probably right. But things are plenty bad already, and when these liberal pundits try and sell their Pollyanna stories about how great things are they only remind people how out of touch those at the top really are.
Things are going well for those at the top. Not only the infamous 1 percenters. The 5 percenters are doing pretty well too. But half the population is struggling to hold on to the standard of living they “enjoyed” back in the mid-1970s (it wasn’t that enjoyable; there were lots of strikes by workers demanding to be treated like human beings), and a fairly large number of our fellow workers are substantially worse off than they were five decades ago. Telling them that things have never been better (for those at the top) just won’t cut it.
In “The Labor Party Illusion,” Sam Dolgoff notes the enormous practical difficulties facing any effort to reshape the government in the interests of the majority through electoral action. The system is quite literally rigged, through artful drawing of electoral districts, restrictions on the franchise (even today, millions of Americans are denied the “right” to vote based on lack of a drivers’ license, legal status, lack of a fixed address, or past criminal convictions), a governmental structure deliberately designed to restrain the majority (the Federalist Papers are quite clear about this), and of course the role of money. (He also points out that even were it practical to place workers’ “representatives” in charge, this would neither bring about a democratic society nor result in fundamental social transformation — the state is an organ for controlling the majority, and as long as a few control society’s wealth, the politicians will do their bidding.)
Lest anyone think this is a historical problem, the Sept. 26 Business Week notes that were presidents elected the same way Congressional representatives are, Mitt Romney would have won the White House in a landslide in 2012 (instead of losing by 3.5 million votes). Congressional districts have been carefully drawn to minimize the influence of workers and racial minorities. Although both houses of Congress are firmly in Republican hands, Democrats (not that they’re much better) routinely receive far more votes for their candidates.
Although it seems she’s doing her level best to lose (like Al Gore before her), it still seems likely that Hillary Clinton will be elected president. This will mean a larger military budget, more bombs dropped on the heads of our fellow workers around the world, more people in prison, and a continuation of the all-out assault on the tattered remains of our social safety net. (Trump offers a more reckless version of the same, flavored with lightly veiled promises to reinforce white supremacy.) But there is practically no chance of the Democrats taking over the House, and so the political struggles of the next four years will be between Hillary’s ruthless conservatism and the even-more-violent reactionaries in Congress.
Unless, of course, we organize a real movement in our workplaces and communities, and use direct action to get the goods.
Last year, one of my daughter’s teachers worked as a waitress on the side, in order to keep up with the bills and student loan payments. When the administrators pushed her around one time too many (they closed our neighborhood school so the state could sell the building, so we’re in a charter and the teachers aren’t in the union, which has gone years working under an expired contract with no pay raises), she quit, figuring she could make as much waiting tables as teaching, and with a lot less aggravation.
This week’s Nation has an interesting article about teachers spending their evenings and weekends driving for Uber and Lyft, so they can make their rent and car payments. (Alissa Quart, “Driven to Extremes,” Sept. 26, pp. 22-25) Many are veteran teachers unable to make ends meet in some of the country’s wealthiest cities. They grade papers and prep classes while waiting for calls.
Uber has a division focused on reaching out to underpaid teachers, allegedly as an act of “civic altruism.” Teachers can’t make ends meet, and so Uber offers them a chance to work longer hours at even less pay! A teacher on Uber’s website puts it this way:
Every day teachers are asked to do more with less, constantly faced with new challenges and limited resources. Uber opens the door for more possibilities and delivers a meaningful impact to the communities we serve.
And as Uber cuts payments to drivers, they can always give up the apartment, move their stuff into the car trunk, and keep taking fares all night long. For the bosses, it’s a win-win situation. For the rest of us, it’s a sign of the times…
The current issue of Business Week includes an interview with AFL-CIO President Richard Trumka in which he says he trusts Hillary Clinton:
I’ve talked to her. I’ve looked into her eyes. I think I know people pretty well… I don’t have any concern that she’s going to double back on us after the election…
It’s this kind of discernment and judgment and respect for authority that’s gotten the American labor movement where it is today. (A chart accompanying the interview notes that U.S. union membership has dropped from 29% of the U.S. workforce to 11% over the past 50 years — which masks a much steeper drop in private sector union membership, offset to some extent by greater organization of government workers.)
Meanwhile, the Democratic Party platform doesn’t even promise to block the Trans-Pacific Partnership trade sell-out, which Trumka trusts Hillary to jettison (not that such pledges mean anything; I remember when the Dems used to promise to repeal Taft-Hartley, but even when they controlled all branches of government they lifted not a finger to do so – indeed, I remember “friend of labor” Jimmy Carter Taft-Harleying the coal miners, for all the good it did [they ignored the injunction, wielded their industrial power, and won their strike, proving once again that direct action gets the goods]). Since both Hillary and Bernie claimed to oppose the TPP, the fact that the platform is mum on the issue says something about who really runs the Democratic Party…
We’re also promised immigration reform, a higher minimum wage, environmental protections, and a host of other things that, if delivered, might actually incrementally improve people’s lives. But anyone who holds their breath waiting had better hope they keel over unconscious before irreversible brain damage sets in. Case in point: the deporter in chief (who during his first run for president pledged that he would put on a comfy pair of shoes and walk the picketline, should workers face attack, but somehow hasn’t managed to find even a single strike worth supporting since taking up residence in the White House his wife aptly notes was built, in part, by slaves) continues imprisoning women and children at record rates, and deporting our undocumented fellow workers at rates that make the Bushes look downright friendly. It’s gotten so ugly that even crazed xenophobe Glenn Beck organized a convoy to deliver teddy bears and toys to the imprisoned toddlers.
But Trumka trusts the Democrats. Perhaps he trusts the bosses as well (after all, they own the Democratic Party lock, stock and barrel). Nothing worth winning was ever accomplished by groveling before the polytricksters, or listening to their lies. Direct action gets the goods.
Today is “Fat Cat Tuesday” in Britain, the day when CEO annual pay overtakes what ordinary workers can expect to earn in an entire year of (much harder) labor. It took just 22 work hours for the heads of the 100 largest British corporations to hit the mark. If I do the math right (I’m not finding a directly comparable calculation for the U.S.), it took about 16 hours for U.S. CEOs to do the same. (Based on a study of CEO pay at the top 350 U.S. companies; there is company by company data on CEO to worker pay that shows a ratio as high as 1,951 to 1 at Discovery Communications [owner of the Animal Planet cable channel]. Chipotle was second, at 1,522, and CVS drugstores came in third at 1,192.)
UK’s Trade Union Group is not pleased:
Ultimately, these figures show the complete failure of this government in tackling inequality and Britain’s low wage economy. By prioritising tax cuts for the very millionaires raking in such high salaries while actively pursuing policies, like cuts to tax credits, which hit the most vulnerable in society, they could not have made it clearer whose interests they prioritise.
This has to stop. For top earners to surpass the average salary for UK workers in under two working days is frankly unacceptable. In order to change this, it is clear that we need to shift the balance of power from the boardroom to the workers.
“Free trade” is increasingly like “free time”; they’re still stealing from you, but now it’s on your dime (or your time).
They’ve finally released the text of the Trans-Pacific Partnership deal, and it’s every bit as bad as expected. As Human Rights Watch says, it’s a “win-win” — unless you care about the environment, labor rights, growing inequality, human rights, access to life-saving medicines, and similar minor issues.
The Obama administration points to “protections” such as provisions “guaranteeing” Vietnamese workers the right to form independent unions, strike, and work with labor organizations around the world. But while corporations have the right to bring legal claims if environmental or labor (or health, human rights, and other measures) negatively impact their profits under the deal, workers have no enforcement mechanisms available to them under the agreement. Corporations have equal status with the governments that signed this deal on their behalf. Both can bring complaints to the TPP disputes panel (comprised of corporate attorneys and their ilk); workers have only those rights they are able to enforce through our own direct action — through strikes, boycotts, refusal to handle scabby goods and the like. Most such actions are severely restricted by existing legislation, and since any improvements to labor rights are certain to negatively impact profits the bosses are likely to bring TPP complaints should any effective protections be implemented.
“Are trade unionists who actually produce all the capital that we’re talking about here allowed to bring compalints against a country for violations?” asked John Sifton, Asian advocacy director for Human Rights Watch. “No, of course not.” Instead we are asked to trust the U.S. government (an implacable foe of workers in this country) to protect the rights of our fellow workers abroad. Similar provisions exist under the Central American Free Trade Agreement and NAFTA, and we can see how those have turned out.
The Obama administrations touts TPP’s strong environmental protections; the Sierra Club and the Natural Resources Defense Council — both solidly mainstream organizations that would never dream of opposing capitalist exploitation — say the provisions are even weaker that those negotiated by the George W. Bush administration’s trade deals.
Candidate Obama talked quite a bit about the devastating effects of NAFTA back when he was trying to get votes. Now that he’s angling for his “legacy” (read high-paid corporate boards, lectures, and the other accoutrements of loyal service to the bosses), “free trade” deals rain down from the sky like a plague of locusts. When she was secretary of state, Ms. Clinton never saw a free trade deal she didn’t like; now that she’s out campaigning she has suddenly seen the light. But when she returns to the White House, or to the Clinton Foundation, we’ll see just how long this sudden concern for the plight of the working class and the devastation of the environment lasts.
The AFL-CIO and kindred organizations will fuss and moan, some Republicans will object to the TPP’s rhetorical restraints on the “freedoms” of corporations to despoil and exploit, and a few Democrats needing votes (but not enough to block the treaty) will speechify about environmental protections and workers rights. But all this is in the realm of shadow puppetry. Only direct action and organized action can create and enforce real protections for our planet or for the workers who create all the world’s wealth.
The July 6 Business Week reports on a proposed rule change, cracking down on companies that give low-paid staff “manager” titles so as to avoid paying overtime. If the rule goes through (and business is fighting it hard), workers in the bottom 40% of wage earners would be automatically entitled to overtime pay, even if they are bona fide managers. (There are a great many low-paid “managers,” following a 2004 rule change that declared that even workers whose primary duties entail stocking shelves, running a cash register, etc., can be classified as managers and so excluded from overtime pay as long as their duties include “supervision” of at least two employees at some point during the work week.)
A former economic advisor to VP Joe Biden is quoted saying this rule change will reach “more middle-class workers” than anything else the Obama administration has done. And it appears that 4.7 million U.S. workers (all earning less than $970 a week) would be entitled to overtime pay for extra hours under the proposal. How such paltry wages justifies calling someone “middle class” just goes to show how flexible the concept is. For Republicans, “middle class” tax cuts benefit millionaires and their ilk; for Democrats, anyone earning minimum wage has entered the ranks of the “middle class.”