MAKING SEN$E -- February 21, 2011 at 3:14 PM ET
What Do Wisconsin Protests Say About Organized Labor?
It's easy to understand in retrospect. After World War II, America was the non-communist world's lone power. Sagely, we handed out billions to revive the economies of Japan and Europe (remember the Marshall Plan?), billions that were spent by them to buy what WE made. The great fear had been unemployment for the flood of returning soldiers. Instead, our factories ran multiple shifts; prosperity took off and fed on itself.
Organized labor went after a portion of the bounty. It threatened strikes, which would hobble the money machine. So, albeit grudgingly, industry shared the wealth. "Blue-collar" became "middle class." At a visit to a GM plant in Framingham, Mass., in the mid-'70s, I wondered aloud at the repetitive, mechanistic nature of the work.
"Good pay, good benefits and no heavy lifting," was the guide's good-natured reply.
At about the same time, conservative commentator Ben Wattenberg hosted a PBS series in which he argued, if I remember correctly, that, despite the criticisms of America's Big Three - Big Business, Big Unions and Big Government - he believed in them all, even unions, conservative as he is. But two inexorable economic forces were already back at work: automation and globalization. Neither was good for Big Unions, grounded as they were in the manufacturing sector.
By the 1980s it was already a commonplace, -- a journalistic cliche, even: manufacturing was going the way of agriculture. Ben Franklin wrote somewhere that in his day, 99 of 100 Americans worked the land. By the time of early Ben Wattenberg, the number was in the low single digits. Today, the number of American farmers hovers around one in a hundred.
What would happen to the "low-skilled" middle class, organized labor wondered, as manufacturing became ever more productive, i.e., as labor-unintensive as agriculture? The fact of globalization compounded the problem -- a world where far-flung cheaper labor elsewhere could run the same machinery far less expensively. What would be the response of a union movement, dedicated to ensuring a middle class income for "low-skilled" Americans in an increasingly services-driven economy?
The answer: Organize the service sector. Who was the biggest employer of service sector workers? Government. Ergo: organize government workers. Done.
Next question: what to bargain for? Higher wages, of course, but there was a limit to how much governments could afford or, more accurately, how much taxpayers were willing to fork over. Thus was a Fram Oil Filter deal was struck: "we'll pay you later." Want more wage hikes? How about a healthy, secure pension instead? Sold.
Meanwhile, a related economic trend was proceeding apace, spurred significantly by our dynamic duo, automation and globalization. That trend: economic inequality - an ever-widening gap between those at the tippy top (5%; 1%; .1%; .01%) and everyone else. But service jobs were less vulnerable to foreign competition or even, it appeared, to technology. Thus, went the thinking, service wages were protectable.
Skip ahead to 2011. Where are we? Most Americans have experienced little to no real economic growth for decades. The American Assumption - my kids will do better than I did - is no longer operative for the vast majority. In fact, workers I've been talking to lately say they're not even living as well as their parents.
As a result, people feel pinched. In straitened circumstances, they tend to pinch in response: pinch pennies. Largess gives way to parsimony. When it comes to unpopular disbursements like taxes, yes gives way to no. The standoff in Wisconsin, then, should come as a rude awakening only to those who've dozed off ala Rip Van Winkle.
One partisan interpretation of events: Wisconsin is about political power, pure and simple -- a Republican governor and legislature trying to break Democratic unions and in so doing, deny the Democratic Party funds to which it has long since become accustomed. As evidence, it is noted that the police and firemen, supporters of the new governor, haven't been touched.
Another broader view from the left: pinched taxpayers are being exploited, egged into resentment against their fellow middle-classmates, while those at the top of the economy will disproportionately benefit from the political consequences: lower taxes.
Responds the governor: unionized Wisconsin state service workers have gotten a free ride relative to their fellow Americans. But regardless of which side you're on, the anti-union fervor in Wisconsin reflects a sentiment that's been stirring for years in increasingly unequal America: I've got less to share, and therefore less inclination to share it.
Paul's stories on economic inequality and the state worker pension crisis in Rhode Island will run soon on the NewsHour.