Staring Into The Abyss With Organized Labor

Posted by Bob Lord

Shadegg and his stooges called me Big Labor Bob four years ago. It may have won him some votes, but it never bothered me. I spent many hours meeting with union members, some of that time selling myself, but a lot of it listening to them. I listened to hotel workers who hadn't seen a raise in eight years. I listened to flight attendants who earned a whopping $13,000 per year. I listened to stories about management tactics to thwart efforts to organize. Calling me Big Labor Bob was meant as ridicule, a way of suggesting I was in labor's pocket. But I wasn't. I just totally believed in their cause. 

And I still do. Now more than ever. Organized labor is on the ropes right now. If they lose, we lose. In the long run, even the filthy rich plutocrats and their Republican puppets who seek to destroy organized labor would lose, although they're too short-sighted to understand that. 

Two developments today reveal the desperate situation for workers in America. Although they don't appear to be connected, they absolutely are. 

First, Hostess announced today that it would be closing its doors, thereby eliminating 18,000 jobs. Hostess, in Chapter 11 bankruptct proceedings, blamed the closing on striking workers from the Bakers and Confectioners Union. The media largely has regurgitated the company's line, although there was some coverage by the San Francisco Chronicle that mentions poor management decisions. But the media spin has been consistently "striking workers caused shutdown."

I had to dig a little, but I was able to find that Hostess was demanding the workers take cuts in pay and benefits of up to 32%. Given that the company already has been through one recent reorganization, the workers undoubtedly were not paid well prior to the 32% cut. So where would they have been if they accepted the cut? Minimum wage? And management? Well, they gave themselves a 70% raise the previous year, when they already had engaged bankruptcy counsel.

But the mentality in America, for 30 years, has been that unions are to blame for faltering companies. And no matter how large a pay cut management demands these days, labor routinely is depicted as the cause of a company's failure if the demand is not met. In the case of Hostess, if management's demand had been a 70% pay cut rather than a 32% pay cut, the story would have been reported the same way, and most Americans still would be blaming those greedy workers. 

Thirty-two percent off an already low number is a huge hit. If union members are supposed to accept a subsistence wage, there's really no point in being organized. But the American public blindly goes along with the idea that unions are the root of all evil, that if those greedy workers stopped demanding wages and benefits we'd all be better off. 

Except we wouldn't, as evidenced by today's story about Walmart, a notorious non-union shop. If you haven't read the story yet, click on the link. It's enough to make you hurl, if you have a shred of decency. The bottom line is Walmart has about one million employees, and has rigeed its procedures to ensure the wages of those employees never stray too far from the minimum wage. In order to make sure they don't overpay, Walmart limits most of those employees to part-time. The employees of course, live in poverty, as the story describes:

Two years ago, when she started working at the deli counter of a Walmart in Illinois, Lisa hoped that her job would amount to the beginning of a career, one that would pay enough to cover her bills and enable her to stay current on her student loan debt.

But despite one raise since, Lisa, who asked that only her first name be used, now earns just $9.10 an hour, or about $13,000 a year on part-time hours. Seven months pregnant, she recently filed for bankruptcy. With no alternatives at hand, Walmart now seems like a dead-end to poverty, she says.

"I don’t have underwear without holes in them," she said. "Everyone at work wears T-shirts that are threadbare. I have just enough to eat and get gas to make it to work for the next two weeks."

And it would take so little to improve their lives. Assume those Walmart workers average 1500 hours per year. That's 1.5 billion hours. It would cost $3 Billion to give each of them a $2 per hour raise, and $3 Billion is less than one percent of Walmart's annual sales, an amount it easily could pass on to customers. Does anyone stop to think of this trade-off — a three quarters of a percentage point savings to customers, versus a 20% pay increase to poverty level workers?

Better yet, if our labor laws were strengthened to allow those Walmart workers to organize, those workers could bargain, collectively, for fair wages. But our rigged system won't allow that. Management will win every time under current rules. And you really don't want to be one of those workers who leads the effort to organize. 

We're at a crossroads. If unions are allowed to die, it won't be long before all workers will lead the lives that Walmart workers lead now. It's up to all of us to stand with them, and hopefully force the Democrats to show some spine on labor issues, something they've been won't to do for decades now. If we leave it to the unions to fend for themselves, they likely won't prevail and, as I said, if they lose, we lose.

UPDATE: I was able to find a detailed explanation of the concessions management sought to force on the Bakers union. You can read it here.

0 responses to “Staring Into The Abyss With Organized Labor

  1. Thanks. You’re spot on regarding the tax code. In fact, one of the express purposes of the estate tax, when it first was enacted, was to curb massive accumulations of wealth. Capitalism is sustainable only if it is constrained by a strongly progressive tax code, appropriate regulation, a social safety net, and active enablement of the rights of labor to organize and bargain collectively. We know where the Republicans stand on all four of those fronts, but the Democrats are falling down on the job as well, just not as visibly and obnoxiously as the Republicans.

  2. Bob;

    I could not agree more!

    One of the major, big-picture problems facing the country is income and wealth inequality. The tax code can and should be used to address these problems but another approach would be to strengthen unions. I don’t mean just playing defense against “Right to Work—-for less”, or “Paycheck Protection” but rather an aggressive campaign to empower workers. Let’s push Congress to move forward on this.

    Bill Astle

  3. Hell yeah! I wish even one nightly news broadcast featured a ‘labor news’ feature – every one has a ‘business news’ which is reported by MBAs based on press releases from companies and interviews with management – any wonder America gets a biased view of economic news?

  4. Great article, Bob. Growing up in Northern Ohio, nearly every Dad in the area was in a union– including mine, who was in the Steel Workers.

    Hostess should look at its products and changing American tastes. Twinkies are a joke… Literally. Why do vampires like Twinkies? Because they have no expiration date. They are so full of chemicals that they never go bad.

    Walmart… Don’t get me started. Walmarts in Germany are unionized. Somehow, being one of the most unionized countries in the world has not hurt the German economy. I support the Black Friday Walmart strike.