Week In Review

A Weekly Column by Bill Onasch
July 5, 2010

Returning to Schedule
My break is over. Tomorrow (Tuesday, July 6) updating of the
Daily Labor News Digest will resume.

While some of my leave was devoted to personal business, that was sandwiched around a four-day trip to the Twin Cities to speak at events sponsored by the Socialist Action and Climate Crisis Coalition monthly forums. Old friends made my visit pleasant and the chance to speak to a fresh audience as well was gratifying. I was also pleased that the venue for both meetings was perhaps the last remaining brick-and-mortar independent working class bookstore in the USA–MayDay Books.

Deal In Sudbury
The Globe & Mail reports today,

“One of the longest and most acrimonious labour disputes in Canadian history may finally come to an end after the union representing former Inco nickel miners in Sudbury struck a tentative deal with the company’s Brazilian owner.”

These Sudbury Steelworkers were among the group of miners from four countries honored at the Labor Notes Conference in April. So far no details of the tentative agreement have been made public. A smaller unit of Inco-Vale remains on strike for now in Labrador.

...and In Minnesota
Tomorrow 12,000 members of the Minnesota Nurses Association will vote on a tentative agreement with Twin Cities hospitals recommended by their bargaining team. The deal, which avoided an open-ended strike already authorized, eliminates the many give-back demands previously advanced by the employers.

However, the proposed settlement does not include the union’s demands for contract language that would guarantee adequate staffing levels. You can find details of the tent, along with a video statement, and some reactions from the ranks, on the MNA Official Blog. We’ll have more to say next time.

The Dip Stick Is Dry
As you have no doubt heard, the latest BLS jobs report released Friday was bad news, confirming what all workers already feel in our bones:

• Counting the “unemployed,” “involuntary part-time,” and “marginally attached to the workforce” categories, there are nearly 26 million who want full-time jobs and can’t find them.

• Work hours fell once more.

• Hourly wages again declined.

Earlier in the week a Pew study showed that since the beginning of the Great Recession fully half of the working class has experienced either loss of a job, reduced hours of work, or cuts in pay and benefits.

The present crisis is quite unlike the cyclical, boom-bust-recovery recessions that have always been a part of capitalism since the Industrial Revolution. There was a time when laid-off workers could usually expect to be called back to their jobs after “inventory adjustment.” Not any more. More than 45 percent of the jobless have been out of work for more than 27 weeks, many much longer. Most of the eight million jobs lost in the last two years are not ever coming back in the communities where they were once performed, at the wage rates they once paid.

That’s because, in addition to usual temporary cyclical drops in customer demand, there is also substantial structural unemployment through offshoring, outsourcing, and technology. These methods have been supplemented by plain old speed-up of those workers remaining on the job--further extending “jobless recovery.” And workers with jobs are being pressured to give-back wages, benefits, and working conditions as the price for continued employment.

Never mind “double dip.” These economic dip sticks are coming out dry–meaning there is insufficient lubrication to prevent further wearing down of the present bleak job market. One CNBC commentator noted the only economic “bright spot” was that corporate profits have begun to rebound.

Massive unemployment, reduced hours, and falling wages not only mean hardship for those directly impacted. The frontline victims of the jobs crisis are now contributing far less in income, sales, fuel and other taxes--upon which budgets for government at all levels depend. Since the recession began the federal deficit has risen from 40 percent of the Gross Domestic Product to a projected 62 percent by the end of this year. So far, China has remained willing to let Washington borrow to meet the shortfall. States, cities, school districts, and transit agencies have no such options.

The recent G20 gathering in Toronto–protected by a massive security force that cost about a billion dollars–decided jobs were not the biggest problem they face. They reached consensus that the deficit crisis–that is the money owed by governments to banks and bond holders–is the overarching priority. President Obama pledged there that the USA will halve the budget deficit no later than 2013.

This not only precludes more stimulus spending; it also requires even more draconian cuts in useful government services than those already being carried out. Those 26 million jobless in the USA will soon have their ranks swollen by teachers, firefighters, transit workers, public health employees, child care workers, school bus drivers, library workers, etc.

This same process is already under way in Europe where job security and social benefits have long better protected workers than their counterparts in North America. Unlike American workers so far, the Europeans are not passively accepting these attacks. This will be a long, hot summer indeed for class battles in places such as Greece, Spain, and France.

Unfortunately, on this side of the Atlantic the labor movement has developed no independent program for dealing with the jobs crisis. In this area, as in all others, they defer to their “partners” in the workplace and “friends” in government.

Right now, the Missouri legislature is in a special session called by Democrat Governor Jay Nixon. The sole purpose is to enact a grant worth many millions of tax dollars to Ford in an effort to maintain two assembly lines at the Claycomo plant in suburban Kansas City.

This corporate welfare proposal comes after a billion dollars was slashed from the state budget--which included the elimination of 2500 state jobs and cuts in education. It has strong bipartisan support and has been endorsed by the Chamber of Commerce–and all organized labor.

While favoring such handouts to selected employers, too many union officials, and former officials, also buy in to the deficit plea of the bosses, bankers, and the White House. Since Andy Stern resigned as president of SEIU he has not only brought his health care expertise to the board of directors of a pharma making drugs to counteract biowarfare pathogens. He is also making new friends among CEOs rubbing shoulders with him on the President’s White House Commission on Fiscal Responsibility and Reform. Their main targets in reducing debt will be Social Security, Medicare, Medicaid, and federal worker pensions.

Nobody worried much about the much larger deficit run up during World War II. The invigorated economy that extended beyond the end of that war eventually retired that debt through economic growth. But those holding current public debt have no expectation that the globalization era of capitalism will bring a return to prosperity in Europe and North America. They see growth mainly in the “developing” countries. The old industrial powerhouses will be picked clean of entitlement programs and deferred worker compensation set aside for our promised pensions and health care in retirement.

“Government spending prevented the U.S. economy from tipping into a depression. But beyond that, the government cannot, short of war, get private companies to increase hiring if they don’t want to.”

So said Bernard Baumohl, chief global economist at the Economic Outlook Group, a Wall Street firm specializing in economic forecasts. Actually, Washington is spending an enormous amount on two long-running wars as well as maintaining sufficient nuclear capacity to destroy the planet several times over. But I get the point he is trying to make. Only during the mobilization for World War II did the government brush aside atrophied markets to take charge of production. It was that government directed mobilization–that also ran up an astronomical fiscal deficit–that decisively ended the Great Depression and created full employment.

Clearly, since we can’t “get private companies to increase hiring if they don’t want to,” we cannot afford to leave them private. World War II is not a perfect model for us–war spending is one of the things we need to eliminate, not expand. But it is an instructive example of how government control and planning can work well and provide good jobs for all who want them.

As mentioned above, a week ago I had the opportunity to speak to a forum sponsored by the Climate Crisis Coalition of the Twin Cities. That talk focused on this question of taking control over key sectors of the economy both to provide jobs and to tackle climate change. I invite you to read it by clicking here.

That’s all for this fortnight

Alliance for Class & Climate Justice

KC Labor Home Daily Labor News Digest Past Weeks In ReviewSign Up For E-Mail List

Site Meter