Radical Philosophy is a UK-based journal of socialist and feminist philosophy. The journal appears 6 times a year and features major academic articles, commentaries, news and a large & diverse reviews section.
Class warfare in the USA
Anti-unionism and the legislative agenda of the 1%
RP 172 (Mar/Apr 2012)
Gordon Lafer
The past year has brought an
unprecedented series of attacks on public employee unions in state
legislatures across the United States. The most dramatic such assault
came in Wisconsin, where newly elected governor Scott Walker pushed
through legislation that effectively eliminated the right to collective
bargaining for his state’s 175,000 public employees.1 Yet while
Wisconsin became the crucible through which much of the population
viewed these issues, it was part of a much broader legislative pattern.
In 2011, bills restricting the collective bargaining rights of public
employees were introduced in twenty-eight of the fifty states, and
adopted in twelve. Ohio, for instance, prohibited employees from
bargaining over anything but wages, and from striking. New Jersey
eliminated public employees’ right to negotiate over health insurance.
Idaho abolished tenure for schoolteachers. Michigan established
unelected ‘emergency managers’ with the power to nullify union contracts
in cities facing budget deficits. Furthermore, while media attention
focused on the struggles of public-sector unions, the year also brought a
host of initiatives aimed at restricting the rights of private
employees – both union and non-union – as well as cutbacks in social and
economic protections for the poor and working class.
In what follows, I will describe the
broad agenda that frames the attacks on government unions and will try
to explain why these initiatives came at this particular historical
moment, before describing the actors and interests that have been most
central in advancing this agenda.
Fiscal crisis as opportunity
In Wisconsin and elsewhere, attacks on
public employee unions were justified as a necessary response to the
fiscal crises facing state governments. Commentators regularly suggested
that budget deficits were the fault of unions that used their political
clout to pad government payrolls and extract exorbitant benefits from
hard-working taxpayers. Wisconsin’s Governor Walker explained that the
union-busting law was needed because ‘our people are weighed down paying
for a larger and larger government’ and ‘we can no longer live in a
society where the public employees are the haves and taxpayers who foot
the bills are the have-nots’.2
But this characterization does not fit the facts of economic reality. Public employees generally make slightly less than their private-sector counterparts.3And
both the number of public employees per capita and the proportion of
state budgets devoted to employee compensation have been flat for the
past decade.4
The budget shortfalls
of 2011 were actually the product of sudden economic crisis. In 2007,
state budgets were in balance, with several states reporting surpluses.5 Three years later, the states faced a combined shortfall of almost $200 billion, by far the largest on record.6
What changed in that short time span was no increase in state spending,
but a dramatic fall-off in revenues caused by the collapse of the
housing market and the onset of the Great Recession.7
Budget deficits struck nearly every
state in the country, regardless of employees’ union status. Statistical
analysis shows no correlation whatsoever between the presence of public
employee unions and the size of state budget deficits.8
Indeed, the state of Texas – which prohibits collective bargaining for
nearly all public employees – faced a massive shortfall of $18 billion,
or 20 per cent of state expenditures.9 If
unions didn’t cause the deficits, it’s also true that eliminating unions
is not a realistic strategy for addressing fiscal problems. Employee
concessions in certain circumstances may be a legitimate part of closing
budget gaps, but this has nothing to do with the abolition of
bargaining rights. This was made painfully clear when Wisconsin’s unions
agreed to 100 per cent of Governor Walker’s economic proposals –
including significant reductions in benefits – only to have Walker
declare that no deal was acceptable as long asworkers retained the legal
right to bargain. Under questioning by members of Congress, Walker
conceded that many of the most anti-union provisions in his legislation
‘wouldn’t save [the state] anything’.10 So,
too, the governor of Ohio – which adopted a law similar to Wisconsin’s
only to see it overturned by a subsequent voter referendum – conceded
that his law ‘does not affect our budget’.11
Eliminating collective bargaining rights was not a fiscal strategy; it was a political power play.
Permanently downsizing the state
The
fiscal crisis facing state governments has been nearly universally
invoked as requiring steep cuts in public services and the sell-off of
public assets. But upon close examination, legislators seem to have been
driven less by urgency to close budget gaps than by the opportunity to
advance long-held goals of shrinking the state and undermining the
political and economic leverage of working people.
These political priorities were first
made evident in the choice of many conservative governors to extend new
tax breaks to corporations and the wealthy even as they forced drastic
cuts in public services. Wisconsin itself, for instance, was one of the
few states not facing a budget crisis going into 2011. The state’s
nonpartisan legislative research service reported that the government
was in line to enjoy a budget surplus; the budget went into the red only
after the governor, as one of his first acts in office, enacted new
business tax cuts.12 Likewise, the state of
Ohio repealed its inheritance tax, and Michigan cut corporate taxes by
80 per cent, all while slashing essential services.
If elected officials were simply
concerned with closing budget gaps, they had many alternative methods
for achieving this end. For instance, the deficits in all fifty states
could have be erased entirely through two simple policy
changes: undoing the Bush tax cuts for the top 2 per cent of income
earners, and taxing capital gains at the same rate as ordinary income.
Yet none of the Republican governors advocated this road to fiscal
balance. Instead, state after state enacted steep cuts in employee
compensation and safety-net programmes for those suffering through the
Great Recession. All told, nearly 600,000 state and local government
jobs have been eliminated in the past three years.13 Funding for schools, child care, public transportation, and care for the elderly infirm have all suffered dramatic cuts.
Similarly, recent legislation will also
make life harder for those unlucky enough to be without a job. Florida,
Indiana, Michigan, Missouri and Wisconsin, among others, all reduced
unemployment insurance benefits. In Indiana, employer contributions to
the state’s unemployment insurance fund were cut by more than 25 per
cent, with workers’ benefits reduced by a similar amount. Wisconsin now
requires unemployed workers to go a full week with no benefits
whatsoever before they are eligible for state support, and several
states promoted new eligibility requirements for recipients, including
increased pressures to take any job offered, no matter how low the wage,
rather than continue searching for a position in one’s field or closer
to one’s previous wage rate.
It is telling that these cuts were not
generally presented as unwanted but temporarily necessary acts. Cuts
were not structured as temporary measures that expire when the economy
rebounds and state coffers are replenished. On the contrary, many states
enacted new structural impediments to increasing revenues even after
the economy recovers – requiring supermajorities to raise tax rates, or
prohibiting the budget from ever increasing faster than the rate of
inflation – that aim at locking in the newly shrunken size of government
as the new high-water mark of public-sector activity. In all these
states, then, the agenda for the public sector is not merely to get rid
of unions and cut employees’ pay; it is to shrink permanently the
capacity of the state to provide essential services or to regulate
corporate practices.
Beyond public employees
While policy debates have been largely
framed around the need for fiscal austerity, the year also saw
widespread attacks on the legal rights and economic standards of
private- sector workers. Eighteen states introduced so-called ‘right to
work’ laws, aimed at undermining private-sector unions. This Orwellian
named policy does not guarantee anyone a job. Rather, it makes it
illegal for a union to require that employees who benefit from a
collective contract contribute their fair share of the costs of
administering that contract. By weakening unions’ ability to sustain
themselves financially, such laws aim to weaken the bargaining power of
organized workers, and ultimately to drive private-sector unions out of
existence.
So, too, a dozen states introduced bills
restricting the ability of both public- and private-sector unions to
participate in the political process, by requiring unions to obtain
annual written authorization from each member in order to spend dues
money on politics. Since both federal and state law already allow anyone
covered by a union contract to withhold dues from political uses, such
laws provide no new rights to employees, but consume considerable union
resources in the bureaucratic activity of collecting annual
notifications, and aim to muzzle the political voice of organized
workers.14 Similarly, thirteen states
introduced bills banning public employees from having union dues
deducted through the state payroll system – even for employees who
voluntarily choose to pay dues. Since there is virtually no cost to
states for electronic payroll deductions, the sole purpose of such
legislation is to cripple unions financially and limit the ability of
organized labour to participate in electoral politics.
The assault on wage standards extends to
non-union as well as unionized employees. Most states uphold
‘prevailing wage’ laws, for instance, which ensure that publicly funded
construction doesn’t serve to undercut local wage standards. Such laws
benefit union and non-union employees alike, but have long been opposed
by non-union contractors who believe they could make higher profits with
lower wage standards. This year they saw their chance to advance this
agenda. Legislation weakening or eliminating prevailing wage standards
was introduced in fourteen states and passed in five, severely eroding
construction pay scales.
Similarly, minimum wage and overtime
laws were scaled back in multiple states, undermining the most important
wage protections available to non-union workers. Both Maine and
Wisconsin adopted laws relaxing child labour protections. Meanwhile,
budget cuts weakened the ability of states to police even those
regulations that remain on the books. In Missouri, for instance, the
governor’s budget eliminated all funding for labour investigators
charged with policing minimum wage, child labour and similar violations.
This package of lower wage standards, less enforcement and reduced
benefits for those out of work combines to render employees more
dependent than ever, with fewer options but to accept whatever job they
may be offered, on whatever terms employers choose to provide.
A coordinated assault on labour standards
One of the most striking aspects of the
past year is not only the extent to which these legislative initiatives
appeared simultaneously in so many states, but also the extent to which
such a disparate array of proposals were promoted as components of a
coherent policy agenda. Michigan, for example, not only restricted
public employees’ union rights and reduced corporate taxes, but also cut
unemployment benefits, prohibited the regulation of repetitive-motion
injuries at work, instituted a new tax on pensions, privatized school
support services, and may well abolish its prevailing wage law. The
commitment to this range of proposals is not based on the specific needs
of the local economy. Pension ‘reform’ did not arise organically in
states with particularly large unfunded liabilities; nor was school
privatization the particular domain of states with underperforming
schools. These laws were not home-crafted responses to local problems;
they were part of a long-standing agenda driven primarily by national
business organizations.
The attacks on workers have been
promoted by a coalition of anti-union ideologues, Republican Party
operatives, and corporate lobbies. Republican strategists have long
identified labour unions and government employees as key ‘pillars’ of
the Democratic Party – unions contributing funds and public employees
providing the army of volunteers knocking on doors in support of
big-government Democrats. It’s no mistake that the hardest fought
anti-union campaigns have taken place in states that are also political
battlegrounds for the presidential election. If Republicans can cut off
union funds and volunteers in key swing states, this may alter control
of the federal government.15 Partly for this
reason, when the 2010 elections swept Republicans into power in these
states, a host of anti-union initiatives that had long lingered on
policy wish-lists suddenly became top legislative priorities.
But behind the network of Republican
operatives, the most important forces spurring this agenda forward are a
cluster of extremely wealthy individuals and corporations, including
traditional corporate lobbies such as the Chamber of Commerce and the
National Association of Manufacturers, along with newer and more
ideologically extreme organizations such as the Club for Growth and the
Koch-backed Americans for Prosperity. Recent trends have conspired to
endow this coalition with unprecedented political leverage. As the US
economy has grown dramatically more unequal over the past few decades,
it has produced a critical mass of extremely wealthy conservative
businesspeople. At the same time, elections for public office have
become dramatically more expensive, leaving politicians ever more
dependent on those with the resources to fund campaigns. Finally, the
Supreme Court’s 2010 Citizens United decision opened the door
to unlimited corporate spending on political campaigns. In this way,
dramatically unequal distribution of wealth has been translated into
equally outsized political influence for those at the top. The 2010
elections were the first ever conducted under the new rules, and they
saw record levels of spending by business political action funds.16 The series of anti-union attacks launched in 2011, in large part, reflect the success of that strategy.
At the centre of this coalition is the
American Legislative Exchange Council (ALEC), a national network that
brings state legislators together with the country’s largest
corporations – including Wal-Mart, Coca-Cola, ExxonMobil and leading
tobacco and pharmaceuticals firms – to promote business-friendly
legislation. Thanks to an exposé by a disgruntled member, the inner
workings of the organization have recently been brought to light (see www.alecexposed.org). ALEC’s 2,000 member legislators include
a large number of Senate presidents and
House speakers. Legislators are invited to swanky conferences where
committees composed of equal numbers of public and private officials
develop model legislation. ALEC’s staff convert these into legislative
language and produce supportive policy reports. Thus state legislators
with little time, staff or expertise are able to introduce fully formed
legislation. Ultimately, the ‘exchange’ that ALEC facilitates is between
corporate donors and state legislators: the corporations pay
ALEC staff’s expenses, contribute to
legislators’ campaigns and fund the think-tanks that promote
legislation; in return, legislators carry the corporate agenda into
their state houses. Over the past decade, ALEC’s leading corporate
backers have contributed more than $370 million to state elections and
over one hundred laws a year are adopted based on ALEC’s model bills.17
In many cases, ALEC pursues initiatives
that directly benefit the bottom line of its corporate patrons. For
instance, ALEC gets money from energy companies and lobbies against
environmental controls; it gets money from drug companies and advocates
prohibiting cities from importing discounted drugs from Canada; it gets
money from technology companies and works to stop cities from providing
free broadband Internet to their residents. But ALEC also promotes a
broader economic and deregulatory agenda that is not directly tied to
the profitability of specific donors. Virtually all of the initiatives
described here reflect model statutes promoted by ALEC; these are not
aimed at immediately enhancing donors’ revenues, but at fundamentally
reshaping the balance of power between workers and employers.
Unions: first on the chopping block
Long-term economic decline in the USA
has produced widespread economic anxiety. The broad popular sympathy for
both the Tea Party and the Occupy movement points to the volatility of
this sentiment, and its capacity to manifest itself in either
progressive or reactionary directions. Those at the top of the economy
work hard to channel this combustible mix of fear and resentment in
directions that are benign for the elite. In this context, public
employees are an easy and obvious target. Yet while both Republican and
corporate operatives have focused on anti-union legislation, it’s clear
that the ultimate goal of these organizations is an economic
transformation that extends far beyond the labour movement. Unions are
the primary target largely because their elimination will make the rest
of the corporate agenda much simpler to achieve.
For the corporate lobbies, the attack on
unions has multiple appeals. On average in the United States, an
employee with a union makes about 15 per cent higher wages, and has a
20–25 per cent better chance of getting health insurance and pension
through their job, than a similarly skilled non-union employee in the
same industry.18 Naturally, corporate lobbies
would like to eliminate unions in order to pay less and profit more. No
doubt many firms also simply resent having to negotiate with their
employees, regardless of what such a process may ultimately cost. In
addition to these personal motives, the corporate lobbies correctly
identify labour unions as the single most important obstacle to a broad
agenda of neoliberalism. The labour movement is much shrunken, but its
14 million members remain by far the largest and most potent force in
progressive politics. When the US Chamber of Commerce pursues its goals
for health care, child care, paid sick leave, unemployment insurance,
international trade, capital gains and inheritance taxes and school
funding, the labour movement is its most powerful opponent on every
score. If the business lobbies could abolish unions, they’d have a free
hand to design the country’s economic policy more or less at will.
Why now, and what next?
Why was 2011 the year that brought such a
ferocious assault on labour standards? At the most macro-level, the
legislative battles of the past year must be viewed in the context of
the long-term economic decline experienced by working- and middle-class
Americans. For the past thirty-five years, wages for non-professional
employees have been on a steady, if gradual, decline, while the number
of hours one needs to work in order to make ends meet has increased
significantly. At the same time, the elements of a secure life – health
insurance, a pension, a reasonable chance at owning a home or putting a
child through college – have become unattainable for a growing swathe of
the country. We are witnessing the first generation of Americans that
expects to do worse than their parents. If the country continues in the
broad policy directions of neoliberal trade, privatization,
de-unionization and deregulation, there is no possibility but that
living standards for most Americans will continue to decline, as the
country is slowly but inexorably competed down to the level of less
wealthy trading partners. This broad reality provides the fundamental
background framing contemporary politics. For the economic elite, the
primary political challenge is how to manage the politics of decline –
that is, how to advance an ever-more-radical neoliberal agenda without
provoking a popular backlash.
In part, conservative business elites
have encouraged a revolution of falling expectations. When people come
to feel lucky just to have a job with health insurance (and then just a
job even without health insurance, so long as they can pay the rent);
when 25 or 35 kids in a class comes to seem fortunate because others are
in classes of 50; when retaining fully funded Social Security and
Medicare even without a pension from one’s job seems lucky – all these
shifts serve to lower people’s expectations of the economy and their
demands of employers. In this sense, the draconian cuts in public
services may serve a long-term political strategy, quite apart from
their material impact on taxes or government regulations. Most of the
time, expectations decline gradually. But occasionally there are crises
that legitimate a sudden redefinition of what is reasonable to expect
from government or employers.
This was certainly the case in the years
following the September 2001 attack on the World Trade Center, when
dramatic tax cuts for the wealthy, budget cuts for the poor, and
roll-backs of union wage standards were all presented as a necessary
part of patriotic belt-tightening in a time of war. The fiscal crises of
2011 offered another such moment, when the normally gradual degradation
of the state could suddenly be sped up in a frenzy of dismantling
public services; when the public could come to accept a quantum step
downwards in its expectations.
Whether this strategy succeeds remains
an open question. The Wisconsin legislation sparked the largest
sustained labour mobilization in many years, and Governor Walker will
likely face a recall election later this year. Several of the governors
who spearheaded the most aggressive anti-union initiatives have watched
their popularity ratings plummet, and voters in Ohio resoundingly
rejected the anti-union statute enacted by their legislature.
Nevertheless, conservative politicians retain the backing of extremely
powerful supporters who appear willing to spend almost unlimited sums to
ensure their allies remain in office. In the 2010 federal elections,
labour unions were outspent 13:1 by corporations, and this imbalance is
certain to increase under the new regime of unlimited corporate
spending.
The great unknown in this drama is how
the vast majority of anxious, insecure, non-union American workers will
make sense of these issues. To this end, it is critical to understand
clearly the past year’s legislative battles for what they were: the
leading edge of an ambitious agenda that extends far beyond
anti-unionism and that, if successful, will transform the nation to the
detriment of almost everyone.
Notes
1. While not
technically outlawing unions, the bill is likely to lead to the same
end. Public employee unions are prohibited from negotiating about
anything other than wages; wage increases for local government employees
are limited to the rate of inflation and must be approved by referendum
of local voters; unions can no longer require those who benefit from
contracts to pay their fair share of the costs of administering them,
and even those who volunteer to pay union dues cannot have those dues
deducted through the state payroll system; all unions are presumptively
decertified every year, and must win support in an annual employee
referendum in order to remain in existence; and participation in any
type of job action is grounds for immediate dismissal. The bill also
completely strips unionization right from faculty and graduate student
employees in the state university system. Roger Bybee, ‘After Proposing
Draconian Anti-Union Laws, Wisconsin Governor Walker Invokes National
Guard’, In These Times, 15 February 2011. Number of employees affected is from Losses to the Working Families of Wisconsin, Wisconsin State AFL–CIO, August 2011.
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