Truthout

The Betrayal of America’s Middle Class Was a Choice, Not an Accident

On October 3, 2012

Originally posted on Truth-Out.

The outsourcing of good jobs, the elimination of pensions, rampant home foreclosures; skyrocketing higher education costs and mounting debt: Given these stark realities, the American middle class seems to be sinking fast. The renowned reporting team of Donald Barlett and James Steele insists it is no accident.

Trade policy, tax cuts and other incentives that have been implemented in Washington since the Reagan era have allowed corporations to score record profits at the expense of the American workforce. Donald Barlett and James Steele, recipients of two Pulitzer Prizes and two National Magazine Awards, powerfully advanced this thesis in their 1992 bestseller, “America: What Went Wrong?”

Now, in a new book, “The Betrayal of the America Dream,” they return to the same topic to examine what has happened in the two decades since. Having first come across Barlett and Steele’s work in the early 1990s, when they were writing the Philadelphia Inquirer newspaper series that ultimately became “America: What Went Wrong?”, I was excited to talk with the duo about the problems now facing our middle class – and about how we can pull ourselves from the abyss.

I started by mentioning their 1992 book and asking how things have changed for the middle class since then.

“Well, the easiest way to answer that question is it has been straight downhill,” Barlett responded. “If we made one mistake in that book, it was that we underestimated the speed with which the country would unravel – thanks in large part to the ruling class, which is having its way.” “When we wrote America: What Went Wrong?”, a lot of it was very controversial at the time,” Steele added. “We said wages were stagnating and going down, benefits were jeopardized or disappearing and our country was being divided into a nation of have-mores and have-lesses. We were accused of being alarmists. People just said, ‘This is a recession. Everything is going to be fine after that.’ We said, ‘Don’t believe it, because all of these forces are entrenched, and they’re going to make things increasingly worse for the middle class.’”

I asked the authors if they have seen any other developments in recent years that they did not expect.

“Back in ‘America: What Went Wrong?’ we talked very heavily about manufacturing jobs – blue-collar jobs,” Steele remarked. “Some of our critics at the time said, ‘Well, that’s okay. Those are dirty jobs. Let’s save the brain jobs, the knowledge jobs, here for America.’ One of the biggest findings in the new book is that the forces that eroded so many blue-collar jobs are now well into the service economy. A study by the Bureau of Labor Statistics a couple of years ago estimated that basically 25 percent of the entire service workforce, or roughly 30 million jobs, [are] in danger of being off-shored and outsourced. That’s a huge number. And, if anything, the Labor Department has underestimated the impact of globalization on the American workforce over the years.”

I noted that at the time that “America: What Went Wrong?” was published, I was working with the labor movement in Silicon Valley. From my vantage point as a labor leader in that setting, one of the book’s points that most interested me was that not all high-wage, high-skill countries were losing their manufacturing jobs or running massive trade deficits. It wasn’t simply wage structures that were won by unions that were driving jobs offshore and overseas. Instead, public policy in the US gave incentive to corporations to outsource and globalize. I asked Barlett and Steele to comment on this point from the perspective of today.

“You’re absolutely right on this basic issue,” Steele said. “One of the myths out there is that high wages paid to union workers are driving these jobs offshore. We make the point that in a whole series of key manufacturing sectors – like the auto industry – workers in places like Germany and Japan make more money through wages and benefits than autoworkers in this country. The idea that just high wages are the reason that companies are going offshore is complete malarkey. The main reason is the incentives provided by foreign governments; and then, when companies bring their product back to this country, there’s essentially no tariff on it. So there’s a tremendous incentive for big corporations to go abroad and not pay any penalty for it.”

Barlett made an additional point: “An integral part of this is the success that the elite have had in focusing attention on the budget deficit,” he said. “While it’s important in the scheme of things, it should be at the bottom of the list, the absolute bottom. At the top should be … and you never hear these two words uttered together … the trade deficit, because it is the trade deficit that results in lost jobs. In the decade of the 90s, the trade deficit was close to 8 trillion dollars. Each year it gets bigger and bigger. We haven’t had a trade surplus since the mid-1970s. Since then, it’s been annual trade deficits. Every one of those annual deficits translates into lost jobs. Yet no one talks about ending the trade deficit.”

In their writing, Barlett and Steele distinguish between global corporations and domestic corporations. I wanted to ask about this because I have seen many domestic companies that are still manufacturing in the United States. They rely on regional and national distribution. They produce jobs. They still remain unionized. Yet they barely stay in business. Government does nothing to help them. I asked what we can do to lift them up and emphasize the value they create for our country.

“You make a really good point here,” Barlett said, “because sometimes we forget this, especially in interviews, and speak about corporations generically. There is no comparison between the big international companies and the domestic businesses that are based in the US and cater to the US market. These people are being absolutely hammered by the tax code, by regulatory policies that are really not necessary, and they have no one speaking for them. They almost need to have a separate voice saying, ‘Look, we are really working for the best interest of American workers here, and we need some help.’ You’re absolutely right. They are being killed.

“Let me give you an example. We didn’t get to it in time to get it into the book, but you have this World Trade Center tower going up. The original design called for a special kind of glass sheathing around the base, because it’s really a bunker and the glass is to conceal the bunker. They issued a contract. A New Jersey glassmaker responded. New Jersey was one of those states with a major position in the glass industry for years. This was an old family company that dates back a hundred years. We went to see the factory floor. You could eat off of it. They’re struggling like crazy to stay in business. It’s third generation family ownership.

“They put in a bid and, naturally, they were beaten by the Chinese. It’s a unionized workforce. They love their workforce. They’re certainly not paid outrageously, but they couldn’t beat the Chinese wages. They lost the contract. What happens in the next year? The Chinese send in the result of their work and the glass is unusable – absolutely unusable. They have to abandon that whole project and come up with a new glass that didn’t require quite the same amount of work to refine it. The irony was that the New Jersey glass company has been making that glass, and has been using it, and was perfectly capable of delivering on the contract, but the United States is so hidebound in its trade policies and in its manufacturing that this company got no help. It’s an absolute disgrace.”

I wondered why these domestic manufacturers don’t have their own business associations, as do other segments of the business community.

“Well, a lot of them do have associations,” Steele said. “The problem is, you’ve got this mindset in Washington, in Congress and basically with almost every administration, that trade should be unrestricted.”

Barlett took a slightly different tack on the question: “This a sophisticated process. It really is,” he explained. “To get the kind of representation you need in Washington costs a ton of money. The domestic corporations just don’t have access to the kind of money that the multinationals do. Many domestic companies pay corporate taxes at a rate five, six, seven, eight times higher than the international companies. Some of the internationals don’t pay any taxes at all. The domestic companies get no comparable break whatsoever. That’s just wrong. It’s morally and ethically wrong. Congress takes care of the people who take care of them. It’s as simple as that.”

Playing devil’s advocate, I asked how the authors responded to people who would characterize their position on trade as being a rehash of old-school isolationism. In a world of global interdependence, I suggested, isn’t it unrealistic to think we’re going to go back and insulate our borders again?

Steele jumped in: “Anytime you talk about something other than the trade policy the US has now, somebody says, ‘Oh my goodness, you can’t throw up walls around the country.’ Well, we are not advocating that. We are simply saying that, from time to time, you need to tell our trading partners that they’re going to have to play by the same rules as we do, or they’re going to face some tariffs, taxes or barriers to some of their goods. “The best example of this is that every year or two the US Trade Representative’s office publishes a manual that’s called basically, ‘Trade Barriers to US Products,’” Steele explained.

“If you read this manual, you find out that Japan has had the same trade barriers up for 20 to 30 years. We’ve been negotiating agreements to end them. But, in fact, they don’t end, because the Japanese have figured out various ways to take care of their own industries.

“Unless at some point one of these trading partners knows that you’re going to be willing to get a little tough, nothing will ever happen. We’re the only country that runs these massive trade deficits, which impact jobs domestically. None of our other major trading partners do. The Japanese have a surplus, the Germans have a surplus, the French have only a small deficit. Nobody has this trade imbalance like we do, and that alone tells you there is something wrong with our trade policy.”

Barlett added, “The definition of insanity is doing the same thing over and over and expecting a different outcome. After 37 consecutive years of trade deficits, all accompanied by lost jobs, I don’t care what anybody says about throwing up walls. You don’t have to throw up walls, but you do need to do something different. If something isn’t done, this country is going to go down the tubes.”

New “Unity Unions” Self-Organize to Confront Workplace Abuses

On October 24, 2011

Originally Published on Truth-Out.

The last five years have been grim and isolating ones for immigrants and working people, right? Overall, this may be the case, but if you talk with organizers at Fuerza Laboral, an independent workers’ center in Rhode Island founded in 2006, you might get a different impression.

Despite difficult times, the group has taken on some bold and determined organizing. And they have some important victories to show for their efforts.

“Fuerza’s roots are really and truly the essence of what the labor movement is: workers organizing themselves and getting together with their communities to identify some real injustices that are systemic throughout the country,” says Josie Shagwert, the group’s executive director. “They got together to say, ‘How can we put a stop to this? Because the system is failing us.’”

Not long ago, workers’ centers were seen as service providers, staff-driven organizations where individuals could go to have caseworkers help with their problems. That has changed over the past decade, and the Rhode Island group is part of the transformation. “Fuerza Laboral builds worker power,” the organization’s web site explains. “[We] organize to end exploitation in the workplace. We train workers in their rights, develop new community leaders, and take direct action against injustice to achieve real victories.”

This work sounds a lot like what unions do. And, yet, Fuerza Laboral is not formally affiliated with the labor movement. Instead, it is an affiliate of National People’s Action (NPA), and shares with other NPA members an organizing model rooted in communities. Fuerza Laboral’s campaigns show two things: why organizing among workers remains essential, and how the labor movement still has work to do in bridging the gap between its traditional practices and new groups doing cutting-edge organizing, especially among immigrants and low-wage workers.

What Good Are Laws Without the Power to Enforce Them?

When Fuerza Laboral first started organizing, it focused on the abuses of temp agencies in Rhode Island, “employers who were underpaying, not paying, taking illegal deductions,” Shagwert says. Having first coalesced around this industry, the group soon moved to take on other businesses with unjust labor practices – notably a local manufacturer called Colibri. On a cold morning in January 2009, some 280 workers showed up for work at the Colibri jewelry factory, a nonunion shop in East Providence. They found a handwritten sign taped to the factory door reading, “Plant Is Closed. Go Home.”

“Shock turned to anger pretty quickly,” says Shagwert, “with people asking, What kind of treatment is this? People had worked there for 5, 15, 20 years.” One of the workers called a local Spanish-speaking radio station and complained on the air about the closing. The radio host suggested that he get in touch with Fuerza Laboral.

“For the first meeting they had 12 people,” Shagwert says. “By the time they got together for a second meeting there were 60 people in the living room of one of the workers, crowded in to talk about what to do and what an organizing campaign would look like.”

The group discovered that Colibri’s closing violated the federal Worker Adjustment and Retraining Notification Act (WARN), which mandates that any business with 100 or more employees must give 60-days notice before closing. (The WARN Act was in the news during the December 2008 occupation of the Republic Windows factory by the Chicago company’s laid-off workers, which Kari Lydersen chronicles in her book “Revolt on Goose Island.”) The law affords an important protection for employees. Unfortunately, there is no federal agency to enforce it. The Colibri workers decided that they would take it upon themselves to make the company obey the law.

“The vast majority of those workers had never organized before,” Shagwert says. Yet, in the course of the campaign, they pulled together a 250-person rally at the Colibri site and also began engaging in direct action. “The workers practiced civil disobedience at the auctions [of company assets],” says Shagwert, “which resulted in 13 people getting arrested.”

During the action, one observer told the local NBC affiliate, “I’d like to see them get justice … This is another AIG deal. The rich get richer, and the workers get the shaft.”

The activists subsequently brought 100 people to the headquarters of the private equity firm in New York that had purchased the company, and workers held a sit-in in the firm’s lobby. “As a result of all those actions,” Shagwert explains, “a prominent labor lawyer in Rhode Island, Marc Gursky, felt inspired by this grassroots surge of energy. He stepped forward and said, ‘I know that to enforce the WARN Act you are going to need a lawyer.’”

For two years, Fuerza Laboral pursued the case in court, and it ultimately reached a settlement. The precise terms of the agreement have not yet been made public. Nevertheless, Shagwert notes, “I will say that the workers felt really happy that after two years they were vindicated.”

“Unity” and Unions

Fuerza Laboral’s efforts show why, even with only 7 percent of workers in the private sector of the American economy covered by traditional unions, there is no substitute for organizing among working people. Even with pro-employee laws on the books, there is little hope of justice without a grassroots demand. Prior to the labor laws enshrined in the New Deal, mutual aid among workers was the very essence of union life. With collective bargaining in decline, the revival of this type of action may be important for labor’s future as well.

Asked what Fuerza Laboral takes from the organizing model of National People’s Action, the national coalition of which it is a member, Shagwert says, “Networking and constantly building leadership. It’s a real belief that everyone who belongs to your organization, or wants to belong, has the potential to take leadership.”

In addition to developing leadership through their campaigns, Fuerza Laboral has also actively pursued a program of political education. “The essence of Fuerza Laboral is having the passion to develop leaders who will confront social injustice,” says Heiny Maldonado, a community organizer at the group. “We have a year-round calendar of trainings for our members and leaders.”

Shagwert adds: “Since 2006, we have put at least 3,000 workers through a really aggressive popular education model within which our members and leaders get trained to teach basic workers rights. We also hold democracy schools: a multi-week school that teaches about organizing, the history of the labor movement, and the history of immigration. Many of our leaders have come through those courses. They take a course, get fired up, and then we look for ways to plug them into the regular organizing we do. That feels like a huge victory.”

If there’s going to be a progressive revival in this country, having a broadly inclusive approach to worker education and developing community leadership will be just as important to traditional unions as they are to workers’ centers. Currently, the labor movement is engaged in efforts to reach out beyond its established membership in shops covered by collectively bargained contracts. From the AFL-CIO’s Working Americaprogram to Service Employees International Union’s (SEIU)Fight for a Fair Economy, labor organizations are seeking to expand their reach into working-class communities at large, recognizing that if they are perceived as a narrow special interest that benefits only a few workers, the movement will be destined to permanent decline.

Operations such as Fuerza Laboral represent another strain of organizing among workers that is taking place outside of traditional labor structures. A decade ago, the relationships between emerging workers’ centers in different parts of the country and traditional labor unions tended to be mistrustful – if not outright hostile, as Janice Fine discussed in her book “Worker Centers: Organizing Communities at the Edge of the Dream.” Few ties existed in most cities. Since then, both sides have made inroads into this challenge and have strengthened their relationships with one another. In the past five years, the AFL-CIO has formed partnerships with the National Day Laborer Organizing Network (NDLON) and with Interfaith Worker Justice.

Yet, gaps in organizational cultures and strategies still remain. The relationships between traditional unions and workers’ centers are continually being redefined, and the interaction of the groups represents a vital ongoing conversation.

As for Fuerza Laboral, Shagwert says: “Our board president has started calling us Unity Union. Which is what we are doing: Representing people in terms of grievances, doing a lot of the things a union would do for its members. But we’re not a union. We don’t identify with workers based on where they are working, we identify with them based on the abuses they are experiencing.”

While she cites alliances with unions such as SEIU and labor groups like Jobs with Justice as crucial to Fuerza’s work, she views her organization differently: “It’s the way I compare working on human rights to working on the rights of one small minority,” she says. “It doesn’t feel right to throw our hat in the ring and fight for one particular group of people. We are fighting for all of us because we are fighting for the most vulnerable.”

She adds, “I want to find a way to say this that isn’t critical of unions. Without unions what would our country be? But I see Fuerza as able to be a little more flexible than a union can be because we don’t represent one particular group of workers.”

Fuerza Laboral at once embodies an impulse toward mutual aid that has deep roots in the history of workers’ struggles and represents a new breed of organization that is expanding in areas where traditional union structures have not been able to reach. For a labor movement that desperately needs to make clear its relevance for all Americans, the task of deepening partnerships with such community allies could not be more urgent.

Tagged with: activism • AFL-CIO • America • Democracy • Fuerza Laboral • Labor • middle class • National People's Action • Occupy • protest • recession • rights • temp agency • union • unity • wall street • Worker Adjustment and Retraining Notification Act

What Role for Labor in the Progressive Uprising? A Conversation With Stephen Lerner

On October 6, 2011

This article was originally published on Truthout.org for Amy’s Walking the Walk series.

No force did more to build the American middle class than organized labor. In recent decades, however, unions have been decimated. Despite concerted efforts to turn the tide, the movement now represents only 7 percent of workers in the private sector. Never have working people in this country been more in need of a collective voice. Yet, we must ask, can labor alone create the change we need? If it can’t do it by itself, what role can unions play in supporting a wider progressive uprising?

Few individuals are offering more interesting, credible and challenging views on this question than veteran labor strategist Stephen Lerner. Ezra Klein recently wrote in The Washington Post: “Ask union types who the smartest labor organizer is and they’re likely to point you towards [SEIU] organizer Stephen Lerner, who planned the legendary Justice for Janitors campaign.” In the most recent issue of New Labor Forum, Lerner has an essay titled “A New Insurgency Can Only Arise Outside the Progressive and Labor Establishment.” It is a must-read for all those who wish to think seriously about creating change in this country.

On a recent trip to Washington, DC, I had a chance to sit down with Lerner on his back porch and have a conversation about his article. I walked away with the resolve that never before has it been so important for labor to have an inside-outside strategy. This means that unions can’t just work to get better politicians elected, but must also help foster a wider grassroots insurgency that can directly challenge the forces that have undermined the American middle class.

We are about to enter an election year, a time when we would normally put all our eggs in the basket of electoral campaigning. But Lerner makes a compelling case that it is necessary for the labor movement to maintain a dual focus. And that will mean changing the way we usually operate.

In his essay, Lerner argues that, amid efforts by the super-rich and major corporations to restructure the economy for their own benefit, unions have not been able to formulate a response by themselves. “Unfortunately,” he writes:

organized labor can be as much of an obstacle as it is a solution to mounting a movement for social justice that might reverse this trend and offer hope for the future.

Unions have the money, members, and capacity to organize, build, and fuel a movement designed to challenge the power of the corporate elite. But despite the fact that thousands of dedicated members, leaders, and staff have worked their hearts out to rebuild the labor movement, unions are just big enough – and just connected enough to the political and economic power structure – to be constrained from leading the kinds of activities that are needed.

Lerner cites examples in which unions have called off high-profile protests or acts of civil disobedience because they were worried that the actions would be perceived as too confrontational, or concerned that such protests would have negative legal, economic or political ramifications.

“If our goal is not to offend anyone,” Lerner told me, echoing a point he makes in his essay, “we might as well not do anything at all.”

I agree with one of his central points here: The more labor is seen as a narrow special interest group, representing the small pools of workers who have union contracts, the more its power will continue to decline. It will be left fighting defensive battles to hold on to the remaining vestiges of the New Deal, even as these are successively whittled away.

In order to change this, labor needs to address the issues that are of central concern to working people in this country, even if those issues fall outside the workplace. This means taking on the big banks, fighting foreclosures, pushing for public investment in our neighborhoods, reversing efforts to strip the state of revenue so that we can pay for essential social services.

I talked with Lerner about the groups that are doing this. A variety of national and regional networks – including National People’s Action, the Alliance for a Just Society and the Alliance of Californians for Community Empowerment - are organizing in communities around just such issues. They are making savvy decisions about which specific lenders, employers and politicians they target. They are coordinating with other community groups across state lines to share best practices for campaign strategy and leadership development.

The labor movement has an urgent need to engage such allies and join in community-wide campaigns in cities across the country. Housing justice, predatory lending, transportation, immigrant rights, the elimination of public services: these are the issues that a huge number of Americans – including those who are union members – are confronting on a day-to-day basis. Efforts such as Service Employees International Union’s (SEIU) Fight for a Fair Economy are starting to join with community allies on such fights, recognizing that labor needs an outspoken progressive movement bigger than itself if it is to succeed.

“One day protests won’t do it,” Lerner told me. “We need actions that escalate, that really grow and gain intensity over time.” In his New Labor Forum essay, Lerner argues that unions should financially support – but not exercise control over – “a new wave of direct action and mass activity.” He uses this year’s protests in Madison, which linked unions with community allies and embraced militant tactics such as building occupations, as an example. More recently, in The Washington Post, he discussed the Occupy Wall Street movement as part of the same model.

Talking with Lerner about how labor might fund, but not control, such protest movements, I expressed some skepticism. Practically speaking, I asked, isn’t it unrealistic to expect local union leaders to hand over resources to community mobilizations without being able to mandate any clear outcomes?

“It’s not a blank check,” Lerner said. “Unions should be engaged with the movement. They should be encouraging their members to join broader efforts and sharing information. But labor sometimes has too much at stake, economically and politically, to take the lead itself.”

As the election year approaches, I believe that Lerner’s argument has profound implications for how unions approach their political program. Now more than ever, labor needs to revive an inside-outside strategy by marrying its political muscle with engagement in community organizing.

In the past decade, unions have developed more sophisticated electoral field campaigns than ever before. This gives the labor movement sway among elected officials, particularly on the local and state levels. The problem is that, in most parts of the country, we are not holding politicians accountable to any concrete agenda. These lesser-evil politicians have no real stake in helping to expand our ability to build up an institutional counterbalance to the power of corporate America. To hold them accountable, we need a progressive movement that applies pressure from the outside.

“People in this country know that the economy is rigged and it’s not working for them,” Lerner said. “They are angry about it, and they are ready to mobilize in ways we haven’t seen in generations. I think unions can play a part in this process.”

What is important about the community mobilizations that Lerner discusses is that they are gaining steam at the same time that labor’s electoral machinery is gearing up. Instead of letting the election cycle distract us from the broader fights we need to be having, the mobilizations can allow unions to be working on both inside and outside tracks. Being engaged with community allies who are undertaking escalating public actions makes labor part of a wider progressive insurgency that is articulating an agenda for how to make the economy fair again, and that is putting that vision out in the street.

“I understand why unions sometimes can’t risk their relationships with certain employers or politicians,” Lerner said. “But that can’t stop efforts to create accountability for corporations and for politicians. Unions need to take a leap of faith and support the uprisings that are working to rebalance power in our country.”

A PDF of Lerner’s article can be found on the New Labor Forum web site here.