The Economic Cure That Dare Not Speak Its Name

If you don’t know Gordon Lafer, you should. He’s an associate professor at the University of Oregon,  a research associate at the Economic Policy Institute, and in 2009-10 was a Senior Labor Policy Adviser to the House of Representatives. He’s also one of the leading experts in the country on the labor movement and labor politics. I asked him over the weekend to comment on a new report, just out in the American Sociological Review, that’s getting a lot of play in the mediaThis is what he had to say.

Last week a new report came out showing that economic inequality is largely caused by not enough people having unions.  For a dry statistical study, this one got a remarkable amount of press—with everyone from the New York Times to Salon to Daily Kos weighing in.  Even Science Daily ran a story.

The findings aren’t new—the question is what to do about them.

But these stories all have a weird quality.

Obviously, people are paying attention to this because the country’s going down, and we all know that one way or another we’re going to have to take something back from the rich if things are going to get better.

But none of these stories end by calling for support of current organizing drives, or for Obama to support organizing even in the ways that the administration can do unilaterally.  Instead, they all tiptoe around these obvious conclusions and then back away, content simply to give articulate descriptions of the country’s demise.  In part, this represents the triumph of right-wing propaganda.

For decades, the right has been hawking the line that unions are anachronistic and Americans just don’t like them anymore.  Despite the seriousness of this year’s Tea Party-fueled attacks, the right is wrong.

The same facts these professors proved with statistics are understood by non-academics just by looking around at the job market.  And people are not stupid.  Polls show that about 40 million non-union workers wish they had a union at work.  Whatever the right may say about the culture of individualism, the truth is that Americans still want collective power in the workplace.

The popular desire for unions is almost entirely invisible because it’s not translated into actual new unions being organized—though 40 million may want a union, less than 100,000 people a year are able to get one through the current Labor Board process.  But this doesn’t reflect a lack of interest on the part of workers.  Rather, it reflects the lengths to which employers go to stop them from getting a union—and thus the seriousness with which employers still take the threat of unions.

The decline of unions is primarily due to two things.  First, employers systematically and aggressively punish those who try to organize.  Every year, close to 20,000 American workers are fired, demoted or otherwise financially penalized for union activism.  Second, the process workers have to go through to form a union is heavily stacked against employees, and would be condemned as undemocratic if practiced in any foreign country.

These problems are not a fact of nature or an immutable characteristic of the globalized economy.  They are simply laws and regulations, and could be changed through normal politics.

Oddly enough, some on the left seem to be joining the corporate right in declaring that unionization is irrelevant.  Smart bosses have long practiced the line that unions might have been great for sweatshop workers and turn-of-the-century coal miners but have no place in the modern economy.  Their voices are now complemented by people like Mother JonesKevin Drum, who notes the impact of deunionization but declares it a lost cause: “Mass unionization is gone, and it’s not coming back,” Drum tells us. “This means we still need something to take its place, and we still don’t have it.  Until we do, the progressive movement will continue to tread water.”

It’s possible that Drum’s historical vision will turn out to be right—it’s certainly hard to be optimistic right now.  But why pick this time to preemptively declare defeat?  There is certainly no easier path waiting for us. Whatever alternative might take the place of unions will face no less ferocious opposition from the business class. And the corporate lobbies clearly think unionization is still sufficiently potent that it’s worth pouring tens of millions of dollars into preventing their employees from organizing.  In this context—and with no alternative plan—Drum’s declaration functions as an invitation for lefty intellectuals to feel justified in doing nothing while they float around in the pool.

The truth is that there is no physical, economic or historical reason to declare unions a thing of the past.  Millions of manufacturing jobs have been lost due to global trade, and most are not coming back.  But manufacturing only accounts for about 15% of the economy.  The rest of the economy includes big industries that are immobile and profitable enough to pay decent wages—health care, education, construction, tourism, transportation, mining, agriculture, real estate, even a lot of retail.  This is the economy that’s not susceptible to globalization and where most Americans make their living.  There is no natural or economic reason that these workers couldn’t form unions and these jobs couldn’t be better paying.

The corporate lobbies are aware of this—and that’s why they are pouring big resources into preventing even modest improvements in workers’ ability to organize at the workplace.

Most recently, the National Labor Relations Board has proposed making a few small changes to the rules governing how workers can form unions—changes that would make it easier to organize, and would make the process look more like elections to Congress and less like the phony elections of totalitarian regimes abroad.

The corporate counterattack has been predictably ferocious. Calling the proposed changes a “blatant attempt to give unions the upper hand,” the US Chamber of Commerce announced it will file suit to block the rules from going into effect. Congressional Republicans moan that the changes will drive jobs out of the country.

What these corporate whores are really opposed to, of course, is not some bureaucratic policy change but the awful prospect of regular old Americans actually having a bit of power. As Republican Congressman Jeff Landry explained to Fox News, the new rules are like putting “a big old sign out in America that says ‘Listen, employers beware – employees will run your company!’”

From his mouth to God’s ear.

But if the specter of organized workers is powerful enough to trouble corporate lawyers and Fox talking heads, it should be enough to stop those on the left from taking early retirement to their armchairs.


  1. Stephen Zielinski August 7, 2011 at 8:45 pm | #

    ‘Unions, Norms, and the Rise in American Wage Inequality’ can be read here:

    • Corey Robin August 7, 2011 at 8:48 pm | #

      Thanks for this, Stephen. I’ll change the hyperlink. Corey

  2. seth edenbaum August 8, 2011 at 11:14 am | #

    “Whatever the right may say about the culture of individualism…”

    Libertarianism is not conservatism it’s an extremist economic liberalism. You have a peculiarly American sense of right and left- and of seeing self-definition as arbiter. The blurb for your book reads the same way.

    Modern conservatism began as aristocratic anti-bourgeois and anti-capitalist. The contradictions of bourgeois conservatism (and of the Catholic Buckley) are of the modern financial elite, the nouveau riche, styling themselves the inheritors of the landed elite.
    European left intellectuals Foucault et al. see the irony in this, American liberals ignore the contradictions in their own worldviews. Modern liberals, especially those in academia, are concerned individualists. That’s not enough.

    Blurb- “Robin argues that the right is fundamentally inspired by a hostility to emancipating the lower orders. ”

    Conservatism originated in the opposition to the “emancipation’ of anyone and everyone.
    It began in an opposition to the modern notion of individual freedom. The root of its hypocrisy lie in the role of the elite as the guardians of all under god. But there’s a long history of an anti-modern left. Liberals still defend “progress” without being able to define it. And they are wary of unions because they are seen to put a break on that progress. Unions are are anti-individualist. Individualists make for lousy defenders their opposition.

    Modern liberal intellectuals don’t defend formal relations. Adversarialism makes them nervous because it’s based on contradiction and a sort of semi-consciousness on the part of those on both sides. Defense attorneys are advocates not truth-seekers. It amazes me how many philosophers (professional truth-seekers) have no understanding of their importance as a model. I’ve sparred endlessly with pseudo-scientists in the humanities who are contemptuous of the irrationalism in culture: “Art-forms and clear exposition are orthogonal.”

    The adversarial systems of justice and of divided government are defined by the orthogonal. Unions are orthogonal to “progress.” Democracy is a formal system of decision-making. Truth production is secondary: laws define process, not result. The focus on result weakens democracy. The road to hell…

    We need a Burkean left, one that defends community not equality. Equality is the language of individualism.

  3. Derryl Hermanutz August 10, 2011 at 1:07 am | #

    Unionization can never be a universal solution. Unions can only gain better incomes and benefits for workers if their employers are able to charge more for their products or services. This works for big corporations who enjoy market pricing power and simply pass along higher labor costs to the consumers of their products. But a plumbing contractor, for example, cannot afford to pay high wages and worker health care and pension benefits because he is not able to charge customers $500 to unplug a toilet. If he tries, other plumbers who aten’t unionized will perform the same service for $100 and the union contractor will go out of business and his high paid workers will be unemployed.

    Much of the modern economy has been collectivized by big business and big government, both of whom can pass on high labor costs to captive customers and taxpayers. But most workers and small businesses still exist in a free market where price competition limits how much “loot” there is to share between the owner and the crew.

    If you think consumers will support $15 hamburgers and $500 plumber service calls, then by all means unionize everybody. But back here in reality prices still matter and most businesses are not big corporations or governments whose monopoly power permits them to charge to the moon
    and pay their workers and managers accordingly.

    • Gordon Lafer August 10, 2011 at 2:30 pm | #

      there’s something to this comment, but not as much as you might think.

      First, the idea that wage and benefit improvements must mean higher prices for consumers is a fiction of undergrad economics textbooks. Back here in reality, there are things called profits, shareholder returns, and rising compensation for management and executives. This is the whole starting point — that the economy has gotten so much more unequal over the past several decades; the point of unionization is to enable employees to get a fairer share of the firm’s earnings. Your math only works if you think there are no significant profits (as neoclassical economics fantasizes).

      Second, unionization is the perfect free-market policy precisely for the reasons — I mean the more sophisticated version of the reasons — you point to. The economy is full of companies with a wide variety of profit margins and abilities to pay decent wages and benefits. Unionization is the opposite of a one-size-fits- all government mandate that sets what compensation each firm must pay. What it does is just enable workers at a given company to negotiate with their employers, to try and get the best deal that is possible that both improves peoples’ lives and keeps the company financially solvent. There is no one more concerned with the long-term financial health of a company than the people whose livelihoods depend on it. So unionization lets workers find the right level — maybe their company can’t make a big increase in wages but can make a small one, or provide childcare benefits but only a mild pension. It’ll be different at each place — that’s why it’s a private-sector response to the economic crisis, cause it’s a supple, sophisticated market tool. That’s how the real world works.

      • seth edenbaum August 11, 2011 at 11:25 pm | #

        There’s are fair among of wishful thinking BS in your pitch.
        You’ve worked for unions in the building trades. I appreciate the effort.

        But non-union crews are cheaper. How many liberal college professors will spend the extra money to hire a union crew to work on their house or apartment?

        I’m a non-union carpenter in NYC.

      • Gordon Lafer August 12, 2011 at 8:42 am | #

        @ Seth – it may be wishful that people will be able to organize in the face of the vicious opposition of their bosses. but there’s no economic wishful thinking involved here. You want to talk construction? Ok, let’s talk construction. First of all, like I said before it’s a big economy and not every type of work has good profit margins, but many do. Long before you start thinking bout individual homes, there is a huge amount of the construction industry that used to be union in most places and is no longer. In most cities what’s still union is just the biggest commercial and industrial projects. In between those and single-family houses are millions of slightly smaller scale or suburban office complexes, malls, public buildings, huge apartment and condo complexes. Many of these things have enough profit in them to pay decent wages and benefits — and they used to. Second, I think you’re making a mistake by trying to turn this into a question of whether individual consumers will be moral heroes by choosing to pay more than they need to in order to support the principle of unions. Of course most people, given the choice, will pay the least they can for anything. If we get to the point where individuals can lease prisoners to build their houses for 50 cents an hour, everyone will do that. That’s the whole idea of union organizing — that you need to organize a whole sector in order to take wages out of competition. Unionization is not about making a moral appeal to kind-hearted people. It’s about getting together a wide enough chunk of the people who do a certain kind of work so that people can’t be played off one against the other and cut each other’s throats. It’s based on an understanding of market mechanisms, and that’s why it works. I can see someone feeling defeated by how hard it is to do this, but the defeatism of pretending that it’s economically unrealistic is childish and makes no sense.

  4. seth edenbaum August 12, 2011 at 11:44 am | #

    I’m not anti~union I’m pro-guild. Skill is worth more than money.
    More later, I’m at work.

  5. seth edenbaum August 12, 2011 at 11:58 pm | #

    The problem with unions, especially the skilled trades, is that they reduce everything to economic terms. The legal triumphs of liberalism from the New Deal to the civil rights movement did no more than transform what had one been seen as private life to public economic life. If your actions have an effect on economic life the logic goes, then fundamentally they are economic. Liberalism is instrumentalism.

    With very specific exceptions, union tradesmen in the US aren’t the best you can get. The exceptions are in jobs where the technical knowledge is such that they those who have it command respect. Union steamfitters with high school diplomas can tell engineers with graduate degrees that their numbers are wrong and the engineers will listen. Mistakes can kill. The important relation is not monetary but proprietary: of a skilled tradesman to his knowledge and experience. Outside of Ironworkers and steamfitters the best tradesmen in NY are non-union, but of course so are the worst.

    German roofers are famous and the rules used to state that you couldn’t open your own shop until you’d apprenticed for 7 years. Under EU regulations this was attacked as unfair.

    I don’t defend the physical trades I defend tradecraft, not for spooks but in the general sense that the contemporary academic model of intellectualism does not accept. Philosophy teaches the primacy of theory; democracy is founded on the primacy of practice. Lawyers are craftsmen. Writers are craftsmen. Musicians are craftsmen. Politicians are crafty. LIfe is Shakespearean before it’s Platonic and your “ideas” about trade are not a trade. As I pointed out before, European intellectuals haven’t lost this necessary sense of irony: they never imagined it was possible to separate ideas from desire and art. If you told Foucault that you thought liberalism was instrumentalism he’d credit you with reinventing the wheel. But liberals love their assumptions: they call them “objective” and say they’re based on “reason” and “science”.
    Forget Foucault, read Derrick Bell on Brown v. Board of Education.

    • seth edenbaum August 13, 2011 at 11:25 am | #

      Unions will never be strong enough if all they do is negotiate better terms for slaves, or mandate factories designed by Temple Grandin. And the contemporary vogue for what philosophers call “embodied cognition” is not enough, since disembodied cognition is impossible.
      The riots in London are the rebellion of those raised to be managed. Is the answer better managers? I mentioned Derrick Bell because his arguments are founded not in disembodied liberalism but his experience as a black man. Where else would be get such skepticism?

      Academic discussion of the lives of working people is like Jewish discussion of Palestinians, art critics talking about art and the feminism of men: it may or may not be well intentioned but either way it’s not enough.

      • Gordon Lafer August 13, 2011 at 12:22 pm | #


  6. seth edenbaum August 13, 2011 at 3:20 pm | #

    Construction trade unions should become contractors, beginning on small jobs that union shops would be priced out of, eliminating the middleman. Contractors are overpaid secretaries. Whatever profit should be returned to the union. Unions should work with architecture schools, offering summer apprenticeships at union training facilities. At time point certificates from such facilities should become mandatory for graduation from any architecture school, but start with one. As it is most architects don’t know how to build shit.

    I’ve seen a 22 year old Mexican homeboy give a gentle swirl to a glass with a thimble-full of wine with more understanding of why than I’ve come to expect from yuppie slacker assholes with something to prove. It was two in the morning and the kid had just left work. Do I have to telegraph that he worked in a restaurant? And probably a very good one. Someone had made the effort to teach him and he had made the effort to learn.

    You’re concerned that people employed in soul-killing work get better pay. I’m concerned with the nature of soul-killing work.

  7. Derryl Hermanutz August 14, 2011 at 11:20 pm | #

    Gordon wrote,
    “That’s the whole idea of union organizing — that you need to organize a whole sector in order to take wages out of competition. Unionization is not about making a moral appeal to kind-hearted people. It’s about getting together a wide enough chunk of the people who do a certain kind of work so that people can’t be played off one against the other and cut each other’s throats. It’s based on an understanding of market mechanisms, and that’s why it works.”

    You are making my point, that much of the economy has already been collectivized by big business and big government, both of whom employ anticompetition to extract higher prices from consumers and taxpayers so they can pay themselves more. You advocate big labor as the third monopoly sector, protecting workers from price competition so labor can get paid more.

    Hey, I’m a contractor and I work so I consider myself a “worker”, and I’m all
    in favor of workers being paid our fair share of the value we create. But for small business, which employs a very large portion of the total labor force, unions just add an additional layer of bureaucracy between the worker and the work. And independent small businesspeople highly resent being told how to run our businesses by bureaucrats who neither know nor care about the financial straits small business often operates in. I would opine that the whole small business sector is too unprofitable to be unionizable, which is the same reason these kinds of work have not been taken over by big business. There is no “surplus profit” for unionists or capitalists to capture. There is just workers trying to earn a living as independent men and women.

    And if you think unions are going to have more success grabbing a share of corporate profits than Congress has trying to tax these multinational tax avoiders, good luck. The reality, under current world trade deals, is union jobs get offshored, or else union companies make high profits by charging high prices to consumers.

    By the way, I didn’t say there was no place in the economic pantheon for collectivized labor. I only said it’s not a universal solution, from the perspective of a guy who has made a living in small business for over 30 years.

    • Gordon Lafer August 14, 2011 at 11:30 pm | #

      I believe that what you object to is not “bureaucrats” but having to negotiate with your own employees — who know plenty and care plenty about your business — because you’d rather have unlimited discretion and autocratic authority over the people who make your business work. Nothing unusual about that, but don’t dress is up as something finer. There’s no sector that “is too unprofitable to be unionizable,” because there is no cost per se to workers’ organizing. Cost only comes if a contract is signed off on by both sides. I bet if we ask your employees, they could come up with at least some modest ideas of ways that might make life better for them and keep the company financially solvent, but take a bit of a bite out of your own profits or your autocratic authority. That’s what you want to call “bureaucracy” in order to disguise the reality of what your’e doing — nothing novel, and nothing noble.

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