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Posts Tagged ‘U.S. Economy’

How the McEconomy Bombed the American Worker

Think of it as a parable for these grim economic times. On April 19th, McDonald’s launched its first-ever national hiring day, signing up 62,000 new workers at stores throughout the country. For some context, that’s more jobs created by one company in a single day than the net job creation of the entire U.S. economy in 2009. And if that boggles the mind, consider how many workers applied to local McDonald’s franchises that day and left empty-handed: 938,000 of them. With a 6.2% acceptance rate in its spring hiring blitz, McDonald’s was more selective than the Princeton, Stanford, or Yale University admission offices.

It shouldn’t be surprising that a million souls flocked to McDonald’s hoping for a steady paycheck, when nearly 14 million Americans are out of work and nearly a million more are too discouraged even to look for a job. At this point, it apparently made no difference to them that the fast-food industry pays some of the lowest wages around: on average, $8.89 an hour, or barely half the $15.95 hourly average across all American industries.

The hardest hit industries in terms of employment now are finance, manufacturing, and especially construction, which was decimated when the housing bubble burst in 2007 and has yet to recover. Meanwhile, NELP found that hiring for temporary administrative and waste-management jobs, health-care jobs, and of course those fast-food restaurants has surged.

The Slow Fade of Big Labor

The big-picture economic changes described by Autor and others, however, don’t tell the entire story. There’s a significant political component to the hollowing out of the American labor force and the impoverishment of the middle class: the slow fade of organized labor. Since the 1950s, the clout of unions in the public and private sectors has waned, their membership has dwindled, and their political influence has weakened considerably. Long gone are the days when powerful union bosses — the AFL-CIO’s George Meany or the UAW’s Walter Reuther — had the ear of just about any president.

The GOP, of course, has a long history of battling organized labor, and nowhere has that been clearer than in the party’s recent assault on workers’ rights. Swept in by a tide of Republican support in 2010, new GOP majorities in state legislatures from Wisconsin to Tennessee to New Hampshire have introduced bills meant to roll back decades’ worth of collective bargaining rights for public-sector unions, the last bastion of organized labor still standing (somewhat) strong.

The political calculus behind the war on public-sector unions is obvious: kneecap them and you knock out a major pillar of support for the Democratic Party.  In the 2010 midterm elections, the American Federation of State, County, and Municipal Employees (AFSCME) spent nearly $90 million on TV ads, phone banking, mailings, and other support for Democratic candidates. The anti-union legislation being pushed by Republicans would inflict serious damage on AFSCME and other public-sector unions by making it harder for them to retain members and weakening their clout at the bargaining table.

And as shown by the latest state to join the anti-union fray, it’s not just Republicans chipping away at workers’ rights anymore. In Massachusetts, a staunchly liberal state, the Democratic-led State Assembly recently voted to curb collective bargaining rights on heath-care benefits for teachers, firefighters, and a host of other public-sector employees.

Bargaining-table clout is crucial for unions, since it directly affects the wages their members take home every month. According to data from the Bureau of Labor Statistics, union workers pocket on average $200 more per week than their non-union counterparts, a 28% percent difference. The benefits of union representation are even greater for women and people of color: women in unions make 34% more than their non-unionized counterparts, and Latino workers nearly 51% more.

In other words, at precisely the moment when middle-class workers need strong bargaining rights so they can fight to preserve a living wage in a barbell economy, unions around the country face the grim prospect of losing those rights.

All of which raises the questions: Is there any way to revive the American middle class and reshape income distribution in our barbell nation? Or will this warped recovery of ours pave the way for an even more warped McEconomy, with the have-nots at one end, the have-it-alls at the other end, and increasingly less of us in between?

American Workers Got What They Deserved

Are you an American employee? If so, today’s column will likely offend you. If you’d rather not be offended, read no further. If you continue and then complain, I’m sorry, but that simply proves you’re, well, stupid. But then again, stupidity plays a large role in today’s topic.

Still reading? OK. You’ve had fair warning.

So you’re an American employee. Maybe you make car parts. Maybe you’re an engineer or designer. Maybe you’re an accountant, store clerk or tradesman. Whatever you do, you’re probably stupid or lazy. Yes, I wrote it, and I mean it. You are either stupid or lazy. Maybe both.

Now, I’m not referring to your work ethic or job performance. No, most of you are competent and devoted to your profession or vocation. I’m addressing the way you view economics and employment. I’m challenging your gumption to advocate for yourself and your fellow Americans.  Here’s what I mean.

Remember the Reagan standard? Are you better off today than you were a decade ago? Two decades? Three? Unless you make more than $380,000 a year, the answer is no. In fact, your standard of living over the last quarter century has actually decreased while millionaires have added 30 percent to their net wealth. Why? Two reasons.

First, hundreds of thousands of manufacturing jobs went overseas while the politicians you elected did nothing to stop them. Yet you continue to elect leaders who offer nothing but tax cuts, as if that would stem the flow of disappearing jobs.

Did you demand your leaders address America’s trade imbalance or continuous outsourcing of jobs? Did you demand your leaders require foreign countries to buy a dollar’s worth of American goods for every dollar of goods they sell here?

No and no. You didn’t bother. You simply crossed your fingers and prayed, “I hope my job’s not next.” You made concessions to your employer and hoped that would stem the exodus of jobs, or at least yours. How did that work for you?

Second, you bought into the myth that unions are the cause of America’s demise. You didn’t bother to learn America became a world power when union membership was at its peak. You didn’t bother to learn America became the envy of the world while 1 of every 3 Americans was a union member.

So, how are things going for you? How do your benefits compare to a quarter century ago? Are you paying a higher or lower percentage of your income for health insurance? Does your company offer a pension plan, or do you now fund your own 401(k)?

Maybe you’re thinking, “I’m not a union worker, so this doesn’t affect me.”

Stop being stupid. Union benefits provide a standard other companies have to match, or at least come close to. When those benefits are cut, yours are, too. Or do you think you operate in your own little employment vacuum?

To make matters worse, you’re again being played for a chump. The same puppets who did nothing while your standard of living decreased are now using the oldest gimmick in the book — jealousy — to continue their assault on American workers. Rather than protect Americans’ jobs, they deflect your attention through jealousy.

“Cut the pay of government workers,” they cry. “Increase their health premiums. Decrease their pensions. Break their unions. After all, you’ve suffered so they should suffer too.” And in your misery, you buy their argument while more jobs head oversees. Pretty stupid, eh?

If their antics weren’t so pathetic, if the consequences weren’t so dire, if they didn’t prey on your stupidity, and if you didn’t buy into their convoluted reasoning, this whole situation would be laughable. But of course it’s not.

I warned you I’d likely offend you, and I suspect I did. But once you overcome your anger, consider my analysis. Then, either wise up and do something about it, or resign yourself to a lower standard of living for the next decade.

Wisconsin Union Bill Passes State Assembly

MADISON, Wis. — Wisconsin lawmakers voted Thursday to strip nearly all collective bargaining rights from the state’s public workers, ending a heated standoff over labor rights and delivering a key victory to Republicans who have targeted unions in efforts to slash government spending nationwide.

The state’s Assembly passed Gov. Scott Walker’s explosive proposal 53-42 without any Democratic support and four no votes from the GOP. Protesters in the gallery erupted into screams of “Shame! Shame! Shame!” as Republican lawmakers filed out of the chamber and into the speaker’s office.

The state’s Senate used a procedural move to bypass missing Democrats and move the measure forward Wednesday night, meaning the plan that delivers one of the strongest blows to union power in years now requires only Walker’s signature to take effect.

He says he’ll sign the measure as quickly as possible, which could be as early as Thursday.

Walker’s plan has touched off a national debate over labor rights for public employees and its implementation would be a key victory for Republicans, many of whom have targeted unions amid efforts to slash government spending. Similar bargaining restrictions are making their way through Ohio’s Legislature and several other states are debating measures to curb union rights in smaller doses.

In Wisconsin, the proposal has drawn tens of thousands of protesters to the state Capitol for weeks of demonstrations and led 14 Senate Democrats to flee to Illinois to prevent that chamber from having enough members present to pass a plan containing spending provisions.

But a special committee of lawmakers from the Senate and Assembly voted Wednesday to take all spending measures out of the legislation and the full Senate approved it minutes later, setting up Thursday’s vote in the Assembly.

The measure forbids most government workers from collectively bargaining for wage increases beyond the rate of inflation unless approved by referendum. It also requires public workers to pay more toward their pensions and double their health insurance contribution, a combination equivalent to an 8 percent pay cut for the average worker.

Senate Passes Unemployment Extension Bill

Democrats on Tuesday broke Republican-led opposition to a bill that would extend unemployment benefits to 2.5 million jobless Americans, but the vote only hardened the political divide and almost assured that any further domestic aid before November will be all but impossible.

Though the Senate reached the 60 votes needed to end a GOP filibuster and force a final vote on the legislation, prospects for the next spending bill — enabling states to avert teacher layoffs — appeared doomed.

A vote that would send the unemployment benefits legislation to the House could come as soon as Wednesday. The House is expected to pass the bill and send it to President Obama for swift approval.