On Labor Day, Here Are 5 Ways To Help Labor

On Labor Day, Here Are 5 Ways To Help Labor

Something to think about when you fire up the grill this weekend.

Jonathan CohnSenior National Correspondent, The Huffington Post

Posted: 09/06/2015 07:33 PM EDT

Labor Day isn’t simply a time to fire up the grill and enjoy one last weekend of summer. It’s a day to think about the challenges facing American workers.  And, these days, that means there’s a lot to think about.

The economy is recovering, and unemployment, according to estimates that the federal government released on Friday, is falling. It’s now down to 5.1 percent, which is lower than at any time since 2008. But the employment-to-population ratio, the economic measure many economists prefer, still hasn’t returned to its pre-recession levels. Wages aren’t rising that quickly, either.

Put it all together and you have a workforce that is doing better than it was, but not as well as it could be -- particularly for those households struggling with child care, medical bills or other costly necessities.

It doesn’t have to be this way. If lawmakers want to help workers, they have options. Here's a quick rundown of five steps they could take -- each with drawbacks and trade-offs, for sure, but also strong merits:

Raise the minimum wage. The simplest case for a higher minimum wage is that its value has fallen, relative to productivity. You can see it in the graph below, from the Center on Economic Policy Research. The wage and productivity rise in tandem through the late 1960s. Then they diverge and, today, the minimum wage is actually lower in real terms than it was back then. 

The usual counter-argument to raising the minimum wage is that it would reduce employment. And it's surely possible to raise the wage high enough that it would truly mean a significant loss of jobs. Economists will be watching data from cities like Seattle, which recently raised its minimum wage to $15 per hour, to see if anything like that happens. 

But the case for more modest wage increases is less ambiguous. A large body of research has shown that raising the wage doesn’t have large effects on employment, for reasons that economist and New York Times columnist Paul Krugman explained a few weeks ago:

The market for labor isn’t like the market for, say, wheat, because workers are people. And because they’re people, there are important benefits, even to the employer, from paying them more: better morale, lower turnover, increased productivity. These benefits largely offset the direct effect of higher labor costs, so that raising the minimum wage needn’t cost jobs after all.

Provide paid family leave. In pretty much every developed country, every worker has the right for an extended paid leave in order to deal with a serious medical problem, to take care of a newborn, or to take care of a sick family member. The exception is the U.S. 

The only protection the federal government offers workers is up to 12 weeks of unpaid leave -- and not everybody has access to that. The protection applies only to firms with fewer than 50 employees. If two parents work for the same company, they must share the allotted time between them.

How big an outlier is the U.S.? Take a look:

Large companies frequently offer the benefit, and the list of companies doing so is growing. But according to a recent White House report, just 39 percent of workers say they have access to paid leave for newborns. 

One of the best arguments for paid family leave is public health. Studies have shown that when parents have more time at home with newborns, those newborns end up healthier. Paid family leave, properly structured, can also bolster gender equality (since the job of caregiving still falls disproportionately on women) and even boost productivity.  

“Paid leave allows more families to fully contribute to our nation’s economic growth and actually boosts household income by enabling parents, especially mothers, to sustain their careers while caring for their kids and elderly parents,” Heather Boushey, president at the Center for Equitable Growth, noted earlier this year.  

One argument against mandatory paid leave is that it’s expensive for the firms that don't provide it now. But advocates argue, plausibly, that the price isn’t that high, particularly since more generous leave policies can attract better workers and improve retention. Besides, firms don't have to bear the financial burden independently. California financed a paid leave law through a payroll tax. 

Stop the assault on unions and start allowing “card check.” Union membership in the U.S. is athistoric lows. The wealthy are getting a disproportionate share of the nation’s income. There’s a reason these things have happened simultaneously. Unions, whatever their failings, give workers more leverage to demand higher wages. 

“There’s little point in even discussing how to solve the inequality problem if you won’t consider ways the government could help rebuild — really, stop suppressing — unions," Timothy Noah, author of The Great Divergence and now an editor at Politico, observed a few years ago. "If you graph a line charting the decline in union membership and then superimpose another line charting the decline in middle-class income share, the lines will be nearly identical. That is not a coincidence.”

So how do you boost union membership? There’s no single, easy answer. But one big step would be to make organizing easier. U.S. firms are famously hostile to unions, and U.S. labor law famously lets them get away with it. Implementing a card-check system -- in effect, allowing workers to vote for a union by petition, before getting formal ratification through a vote -- is one way of addressing that.Canada has the same system and, not surprisingly, union membership there remains much higher than in the U.S.

The best argument against card check is that it would work -- that, if union organizing were easier, more people would belong to unions. Critics, particularly but not exclusively on the political right, say unions impede innovation, are prone to corruption and ultimately hurt workers more than they help. Labor supporters argue that unions can co-exist with a thriving economy, as they long have overseas, and that they are ultimately a net benefit to workers. 

Bring the Affordable Care Act’s Medicaid expansion to the whole country. Medicaid is the government health insurance program for low-income people. It’s been around since 1966, but most states restricted eligibility pretty narrowly until 2014, when the Affordable Care Act offered states a deal: Make the program available to all households where income is below or just above the poverty line, and the feds would pick up most of the cost. As of today, 30 states plus the District of Columbia have said yes.

That means 20 states haven’t. Among them are Florida, Georgia and Texas. If just those three states embraced the expansion, more than 2 million people would become eligible for coverage. And while some of them would be unemployed, about half are in families with at least one part-time or full-time worker. The problem -- again, most acute in low-wage industries like fast-food -- is that these jobs frequently don’t provide health insurance.

Insuring these people through Medicaid costs money, even if it comes primarily from the federal government rather than the states. And Medicaid is an imperfect program: Beneficiaries can struggle to find specialists willing to see them, since the program pays doctors very little. But studies have shown unambiguously that people on Medicaid get critical economic protection. Research also suggests, albeit less conclusively, that people on Medicaid end up healthier than if they had no insurance at all.

Expand the EITC to childless workers. One of the most successful programs to fight poverty is theEarned Income Tax Credit, which basically acts as a wage booster. If you work, but your income is low, then the government will give you some extra money. In other words, it turns low-paying jobs into not-so-low paying jobs.

One of the program’s shortcomings is that it does very little for childless workers. The formula is complicated, but for a single childless adult with an annual income right around the poverty line, the value of the tax credit works out to a little more than $200 a year. A parent of one child with household income around the poverty line would get more than $3,000.

Reducing the credit's eligibility age to 21 and raising the maximum value of the credit could provide relief to millions of low wage workers -- in ways that could benefit the rest of society, too. For example, it could boost employment by making low-wage jobs more attractive. 

The main trade-off to a higher EITC is that the money comes out of the federal treasury. An increase would likely cost between $5 and $10 billion dollars a year, depending on the details of the proposal. But the EITC has a bipartisan pedigree, going back to the days of Ronald Reagan, and in recent years at least some Republicans have endorsed calls for its expansion -- in part, perhaps, because it's a tax cut. 

As Robert Greenstein, president of the Center on Budget and Policy Priorities, has noted, “When you look at these young workers or middle-aged workers who are single individuals, if they’re paid low wages, they’re the one group whom the federal government today literally taxes into poverty or deeper into poverty. That should be something that both parties can say, that’s not a good idea. And both parties want to encourage these people to work more, and the Earned Income Credit does that.”

MORE: Labor Day, Labor, Unions, Organized Labor, Minimum Wage, Eitc, Paid Maternity Leave, Paid Leave,Sick Days, Medicaid, Card Check, Poverty , Living Wage

Why unions are essential

The Progressive Review AN ONLINE JOURNAL OF ALTERNATIVE NEWS & INFORMATION

Why unions are essential

by Sam Smith Progressive Review

If you came of age in the past ten years and don't belong to a union or come from a family of union members, chances are most of what you've heard about these labor organizations has been, on balance, negative.

Which helps to explain why as late as a decade ago, two thirds of Americans approved of unions while today, less than half do. Go back to the 1950s and you'll find three-quarters of Americans liking unions.

The membership decline in unions has been as bad. Between 1973 and 2007, for example, the percent of private sector workers in unions declined from nearly a quarter to 7 percent.

In a 2007 Paul Krugman of the New York Times explained what happened:

||||| It's often assumed that the U.S. labor movement died a natural death, that it was made obsolete by globalization and technological change. But what really happened is that beginning in the 1970s, corporate America, which had previously had a largely cooperative relationship with unions, in effect declared war on organized labor.

Don't take my word for it; read Business Week, which published an article in 2002 titled How Wal-Mart Keeps Unions at Bay. The article explained that "over the past two decades, Corporate America has perfected its ability to fend off labor groups." It then described the tactics - some legal, some illegal, all involving a healthy dose of intimidation - that Wal-Mart and other giant firms use to block organizing drives.

These hardball tactics have been enabled by a political environment that has been deeply hostile to organized labor, both because politicians favored employers' interests and because conservatives sought to weaken the Democratic Party. "We're going to crush labor as a political entity," Grover Norquist, the anti-tax activist, once declared. |||||

Then the disastrous Ronald Reagan signed the White House up for the war against unions and it wasn't long before the corporate media was lending a hand, which has continued right to the present.

For example, in 2006 the Progressive Review checked on the number of paragraphs you had to read about the Delphi buyout before finding labor's view on the matter. The results:

New York Times - 26 paragraphs

Detroit News - 22 paragraphs

Washington Post -11 paragraphs in the news section and 27 in the business section.

Newspapers used to have labor reporters; they rarely do anymore. Instead even liberal public radio is filled with Marketplace but not a single program offering the other side.

And the news bias continues right down to coverage of the Wisconsin protests, as Dean Baker pointed out, citing a New York Times news article that referred to the "need for public employees to sacrifice."

And when the House Republicans tried to defund the National Labor Relations Board - a key agency founded by the New Deal - the story got covered by the Wall Street Journal and a few others (Google only lists 5). 176 Republicans had voted to support Policy Committee Chairman Tom Price (R., Ga.), who said that cutting the agency’s funding “can save taxpayer dollars and help protect American job creators from an out-of-control agency.” And most of the media just ignored it.

Further there has been a growing separation between union workers and the lifestyle and culture of an increasingly elitist liberal class that was once strongly pro-union but now can hardly get itself involved in basic economic issues.

That said, it is also true that unions have done far less than they should have to prevent their own demise.

Like every large American institution - from government to universities to non-profits - unions have become self-centered, more responsive to the needs of their leaders than of their constituents, unimaginative, bureaucratic, corporatized and stuck in the mud. And, yes, you can add in corruption.

They have failed to adapt to changing economics and culture. For example, they could have used non-union approaches to organize, educate and inspire the growing number of non-union workers, much as the AARP has done with senior citizens, using a combination of social action and social benefits. True, the Wal-Mart employees are not in the union but they won't even know how to begin without someone leading the way. Traditional unions have failed them.

One of the few labor leaders to even discuss this was Ed Ott, executive director of the New York City Central Labor Council, as the NY Times' Steven Greenhouse described in 2008:

|||| [Ott] has an unexpected and unnerving warning for New York’s more than one million union members. He warns that their wages and living standards will be threatened unless the city’s unions do far more to lift the incomes and living standards of the city’s nonunion working poor, including restaurant workers, supermarket cashiers and taxi drivers. . .
“For a working class that is going to be making minimum wage or slightly above, what’s going to happen is that as taxpayers, that will create a social base for an attack on our own standards.”. . .
Mr. Ott sees two working classes in New York: a unionized one that is doing well and a nonunion one that is struggling to get by.
“You see a working class on the subway at 6:30 in the morning and you see them at 8:30 at night heading home,” he said. “They work in the back of restaurants, they clean buildings nonunion, they’re child care workers, they’re in retail. Frankly, I marvel that these guys can find a way to live in this city." ||||

Labor unions have also been largely indifferent to non-traditional relationships such as those of cooperatives, worker ownership, and worker participation at the board level. Too often, labor just seems to be trying to recreate the 1930s all over again.

A rare exception was news that the Mondragon Cooperative Corporation, a multi-billion dollar cooperative based in the Basque region of Spain, formed an alliance with the United Steelworkers, the largest industrial trade union in the U.S. The two announced that they would develop Mondragon manufacturing cooperatives in the United States and Canada that would "adapt collective bargaining principles."

Yet despite such faults and weaknesses, at the end you are left with one indisputable fact: nothing has been invented that has been as successful and positive in representing the needs and rights of workers as labor unions. Nothing. Even the lawyer in Washington or the stock broker on Wall Street should - if both decent and knowledgeable - give considerable thanks to labor unions for their weekends and vacations.

Let's review the bidding. Here, with the help of several sources, is a list of things that have been large part of significantly the result of labor union organizing and action:

The labor movement in the United States led the struggles to:

- The end of child labor

- The right of workers to negotiate with their employers over wages, benefits and working conditions

- The 8 hour work day and paid overtime

- Compensation for workers injured on the job.

- Unemployment insurance.

- A minimum wage

- Pensions

- Healthcare insurance

- :Paid sick leave, vacations and holidays

- Elimination of job discrimination by ethnicity, color, religion, sex or national origin

- Family medical leave

Further, if you look at the countries with the highest union membership - 57% to 82% in Scananvian countries, for example - you find that only a few - such as Ireland - that also make the list of countries in deep financial trouble.

While it would be difficult to draw a strict correlation, it is fair to say that nations that respect their workers are least likely to give the sort of freedom to rip everyone off that the American government has given Wall Street. At the very least, strong union membership exists because of values towards which any decent nation should strive.

AFL-CIO

Finally, there is that most tangible virtue, money, and as well as less tangible virtues - as :Paul Rosenberg discussed in Open Left last year:

|||| We all know that unions aren't as strong as they used to be. But how many of us realize that they are still creating America's middle class? The difference between a union and a non-union job doing exactly the same sort of work averages more than 25%. And for Latinos it's double that: 50%.

This is just a taste of the tangible difference that unions make. The tangible difference is the easiest to measure. But it's the intangible differences that are the greatest. Without the strength, unity and security that union solidarity provide, everything a working family has is always at risk, even the bonds of family. Parents can work all their lives providing for their children, only to see everything swept away by forces beyond their control. This happened repeatedly to millions of families throughout the 19th century, even though it was a century of fantastic economic growth overall.

Unions have helped to make that world utterly foreign to us--even for non-union workers, who enjoy many benefits and protections that organized workers helped to secure... such as Social Security and Medicare. And yet, that world of radical insecurity could well return again, if we forget what it took to put an end to it, what it took to create the world we know now.|||||

We have developed an economy in which an extraordinary proportion involves nothing but the manipulation of capital and in which another extraordinary proportion creates that capital without jobs for American workers.

Until we revive our respect for labor - and its right to organize, be treated fairly, participate and agitate - then our downhill slide will simply accelerate. A country that invites its CEOs to the White House yet bans its labor unions from bargaining rights has no future.

It is as Abraham Lincoln said, long before the era of either unions or rogue capitalism: " Labor is prior to, and independent of, capital; that, in fact, capital is the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital and deserves much the higher consideration."

Membership in unions

Why Unions Still Matter

Al Jazeera America News

Opinion

 

MPI / Getty Images

Unions still matter

New evidence suggests that unions may be more important than Democrats in reducing inequality

April 15, 2015 2:00AM ET

 

by Sean McElwee @SeanMcElwee

 

This year the Republican war on unions has returned with a vengeance. In former labor stronghold Illinois, GOP Gov. Bruce Rauner is pursuing right-to-work legislation — which allows workers to gain the benefits of union representation without paying dues — and looks likely to succeed. Wisconsin became a right-to-work state last month, and its Republican Gov. Scott Walker looks set to ground a presidential bid in union busting, recently saying his political fight with unions prepared him to take on the Islamic State in Iraq and the Levant. The Supreme Court appears ready to overrule its Abood v. Detroit Board of Education decision, which allows unions to collect dues from nonmember public sector workers who nonetheless benefit from collective bargaining.

With the enemies at the gate, the liberal elite seems to have finally learned to love unions. Nicholas Kristof writes that, contrary to his earlier opinion, “we should strengthen unions, not try to eviscerate them.” Former Treasury Secretary Robert Rubin, a key architect of Bill Clinton’s finance-friendly economic policy, recently argued, “Measures that facilitate collective bargaining can result in a broader participation in the benefits of productivity and growth.” And in “The Report of the Commission on Inclusive Prosperity,” which is likely to become the centerpiece of Hillary Clinton’s presidential campaign, the commission, co-chaired by Ed Balls and Lawrence Summers, concludes that “we need to support the growth of unions.”

But it may be too little, too late. Democrats did little to defend unions when it counted. Under President Jimmy Carter, Alfred Kahn began deregulating the airlines. Carter then signed into law legislation deregulating railroads and trucking (both hobbling powerful unions). President Bill Clinton pushed for the North American Free Trade Agreement against union opposition and deregulated finance, greatly empowering capital. To be fair, some of these pressures came from global trends, but public policy played a key role in tilting the field against labor. Now Republicans are fighting to drive a final spike in the heart of the most effective anti-inequality movement in history. If liberals do nothing to shore up unions, their decline will only continue. That will have important implications for inequality.

What unions do

Unions not only give their members a voice at work but also can have much broader political effects. By mobilizing voters and contributing to campaigns, organized labor is in effect the only lobbying group operating in the interest of ordinary Americans.

In a 1998 study, political scientists Benjamin Radcliff and Martin Saiz found that “the relative strength of the labor movement across the American states is one of the principal determinants of policy liberalism.” They found that the rate of unionization has a dramatic effects on spending for Aid to Families With Dependent Children and education as well as on tax progressivity and that these effects are stronger than Democratic governors and Democratic legislatures. As Radcliff told me, “strong labor unions are able to influence public policy, so as to create programs … that benefit everyone in society, not merely organized workers.”

Unions are the most important institution in the fight against inequality.

One way unions reduced inequality was by boosting voter turnout, which gave them political leverage. It’s rarely noted, but the campaign for Seattle’s $15 minimum hourly wage could not have succeeded without a massive, union-led voter registration drive. Many studies have confirmed that unions boost voter turnout and that their Election Day mobilizations push candidates and parties to the left.

Percent reported voting, union and non-union households

Source: ANES, 1948-2008.

In a country where few politicians come from a blue collar background, unions have often been a conduit for workers to enter politics. Political scientist Nicholas Carnes found that “a 10-point increase in the percentage of the state that belonged to labor unions was associated with a 1-point increase in the percentage of state lawmakers from the working class.” Given that politicians’ occupational background and wealth influences their voting behavior, this is another important way unions can promote policies beneficial to the working and middle classes.

The right-to-work revolution

But unions have always faced deep opposition, especially in the South, where many of the first right-to-work laws were passed. Historian Elizabeth Shermer writes, “The central message in the Southern right-to-work campaigns was preserving the Old South’s racial order.” Southern elites feared that an organized working class would be a threat to the racist social and economic practices that had long defined the region. They successfully kept collective bargaining at bay with laws that forbade unions from requiring beneficiaries of its negotiations to become members and pay dues. These right-to-work laws appealed to non-elites by channeling widely held anti-government individualism. But labor law expert Raymond Hogler notes that the question has often been posed in deceptive terms:

Many polls show a strong majority of Americans are against making workers pay union dues to keep a job. That’s the wrong question. When workers in a union are asked whether anybody benefitting from a collective bargaining agreement should pay dues to support the agreement, they say yes.

As right-to-work laws spread from the South to the rest of the country, the results have been devastating. A paper by Holger, Steven Schulman and Stephan Weiler shows that right-to-work states have seen an 8.8 percent decrease in union density and that these laws account for slightly more than three-quarters of the difference in union density across states.

Another study found that from 1989 to 2002, whether a state had a right-to-work law was more important than partisan control of the state government in determining the progressiveness or regressiveness of the state’s taxes. This conclusion holds up at the global level, according to a recent International Monetary Fund study showing that lower unionization rates were associated with an increase in the share of income going to the top 10 percent of the population.

Political actors

The importance of these studies is clear: Unions are the most important institution in the fight against inequality. But for too long, many liberals seemed happy to watch unions disappear. Part of the problem is that they misunderstood unions as primarily economic institutions, interested in parochially negotiating wages and benefits for their members. In reality, unions are far more important as political actors promoting policies that benefit the working class and middle class as a whole. As legendary United Auto Workers leader Walter Reuther put it in 1970:

"There’s a direct relationship between the ballot box and the breadbox, and what the union fights for and wins at the bargaining table can be taken away in the legislative halls."

It’s nice that the Kristofs and Summerses of the world have finally caught up with Reuther. We can only hope it is not too late.

Union membership and share of income going to the top 10%

Source: Economic Policy Institute, 2015.

Sean McElwee is a research associate at Demos.

The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera America's editorial policy.