Brian Cooney: In Memory of Labor Day

A BUZZFLASH READER CONTRIBUTION
by Brian Cooney

For most people, Labor Day means the long weekend at the end of summer, picnics, and sales at the mall. This Labor Day also marked the start of the GOP convention and the landfall of Hurricane Gustav. It was especially easy to forget the original meaning of this holiday. As the U.S. Department of Labor explains on its Web site, Labor Day is "a creation of the labor movement. . .and a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country."     

Despite these contributions, American workers are not being treated well in our economy. In Bureau of Labor terminology, "production and nonsupervisory workers" comprise about 80% of all nonfarm private-sector employees. From 1947 to 1973, the average weekly earnings of this group rose 161%. From 1973 to 2005, they declined by 6.5%.             

Growth in labor productivity (output per worker) and median family income kept pace with each other from 1947-1979. Since then, labor productivity has grown much faster than family income. An increasing share of the wealth that labor has created over the past 25 years now goes to capital income (corporate profits and shareholder dividends).

Since capital income goes mostly to wealthy households, wealth inequality in the United States is going from bad to worse. In 2007, the richest 1% of households owned more of the nation's private wealth than the bottom 90%.

Why is American labor in such a bad situation today? Part of the answer is declining union power. Since 1945, union membership in the private sector has declined from a historic high of 35% to 7.4% today.

The quarter-century after WWII was, in some ways, the golden age of the American labor movement. Union workers earned 20% more than comparable nonunion workers did. Contracts included promotion and layoff regulations, grievance procedures, and substantial health, pension, and other benefits. Capital and labor seemed to be creating a progressive social contract.

But all was not as it seemed. The strength of the union bargaining position during the postwar period came from a strong demand for factory labor at a time when U.S. manufacturing capacity was much greater than that of the war-ravaged economies of Europe and Japan. As those economies recovered, demand for American industrial labor slackened, and unions lost much of their bargaining power. They were further weakened by an increasing migration of population and industry to the anti-union South.

The European labor movement has been much more successful in securing a better life for workers. After WWII, European unions had the political power to bring about a dramatic rise in the share of national budgets devoted to social services, and in the share of national income going to the working classes. Furthermore, European unions got their governments to extend the provisions of union contracts to all workplaces within an industry, whether unionized or not. In these ways, they were able to avoid the American problem of costly union contracts imposing a competitive disadvantage on unionized firms.

Perhaps the greatest weakness of the American labor movement was that it never achieved the numbers and unity that would enable it to pressure the federal government to enact its social and economic agenda. Unlike their European counterparts, American unions relied on decentralized negotiations with corporations to provide benefits such as pensions and healthcare that lasted only as long as a contract. The lack of centralized union pressure on government is one of the main reasons why the United States is the only advanced capitalist society without national health insurance.

Although union membership has declined drastically, a survey conducted by Peter D. Hart Research Associates in December 2006 revealed that 60 million American workers would join a union if they could. However, when workers attempt to organize, they face harassment and intimidation by management. Employers get behind-the-scenes advice in their anti-union drives from lawyers and "labor consultants" in the $4 billion union-busting industry.

In our public discourse, it is considered almost impolite to speak of classes or class conflict in American society. But Labor Day is about the working class, the "production and nonsupervisory workers" in the private sphere, and their counterparts in government service. Labor Day is a reminder that in a capitalist society, there is a division between a working class and a class that controls capital through outright ownership or managerial control. The stagnant wages, job insecurity, inadequate vacation time, nonexistent or overly expensive health insurance, "free trade" agreements that put our working class into competition with exploited workers all around the world, are all effects of the victories won by American capital over labor during the past three decades.

A BUZZFLASH READER CONTRIBUTION

Brian Cooney

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