Transcript Prevailing Wage Laws

GLOBALIZATION UNIONIZATION AND
ENVIRONMENTAL PLAS
A Brief History of American Unions
Great Upheaval
– Railroad strike of 1877
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First nation-wide strike
Breaks localness of labor-management conflict
Reflects rise of big corporations
State governments play role in breaking strike
Comes during deep depression of the 1870s
May Day
• Effort to Create the 8-Hour Day through countrywide strikes
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May 1, 1886
Typically workers worker 10-12 hours per day
May Day came during booming economy
Working day shortened in some industries
• Typically industries using skilled labor
– Becomes international working class holiday
• Not in US—associated with anarchy (pre-communist radicals)
Pullman Strike
• First industrial strike
– Craft organization versus industrial organization
• Skilled workers in separate unions versus all workers in one union
– Railroad unions = craft unions
• Eugene Debs formed the National Railway Union
– Along with United Mine Workers, NRA = first industrial union
– Pullman strike lost when Federal government intervened
on behalf of employer
• President Cleveland’s reason = keep the US mail moving
Homestead Strike
• First major strike precipitated by management
to break a craft union
– Issue: who controlled production
• The boss or the skilled workers
• Involved Andrew Carnegie and the skilled iron workers
(steel makers)
• Technological change favored Carnegie (the Bessemer
Process)
Post World War I Strikes
• Reflect the rising power of labor unions
– Not the craft unions of the 1800s but the first real
signs of industrial unions
– Inflation of the war had cut real wages
– Revolution in Russia created the Red Scare in the
US (fear of radical unions)
– Federal government played active role in breaking
strikes (anti-immigrant politics)
The Great Depression
• Causes of the Great Depression
– Over-production (excess manufacturing capacity)
– Under-consumption (limited wage growth due in part to a
broken union movement)
– Government policy (Federal Reserve kept money supply
relatively tight during downturn)
– Stock market speculation (huge speculative bubble in stock
prices bursts in Fall of 1929)
– Restriction of international trade (Smoot Hawley tariff)
Early Efforts to Fix the Economic Slump
• Republican Herbert Hoover (1929 to 1933)
– Public works construction projects
– Prevailing wage law for public works
– Balance the federal budget
• Democrat Franklin Roosevelt (1933-1945)
– Industrial Recovery Act
• Set prices and wages industry by industry
• Declared unconstitutional
1934 Strikes
• San Francisco General Strike (longshoremen)
• Minneapolis General Strike (teamsters)
• Textile strikes (South)
– These strikes indicated that the issues of high
unemployment, employer wage cuts and lack of
democracy at the work place would not go away
by themselves
National Labor Relations Act 1935
• Gave workers the right to organize into unions
– Established election procedures whereby unions
could be elected by workers and employers had to
bargain with these unions
– Identified unfair labor practices that employers
could not use to keep out unions
– Outlawed company unions
Other Labor Oriented New Deal
Legislation
• Fair Labor Standards Act
– Created federal minimum wage
• Agriculture exempted to win vote of rural legislators
– Required overtime to be paid after 8 hours in a day or 40
hours in a week
• Culmination of May Day movement but did not establish the 8
hour day as an absolute limit
• Social Security Act
– Provided old age income
– Pay-as-you-go system
Formation of the CIO
• Congress on Industrial Organization
– Led by John L. Lewis of the United Mine workers (Coal)
• An industrial union within the craft-oriented American Federation
of Labor (AFL)
– Aimed at organizing all workers within an industry
• Manufacturing was the key target
• Problem of Dual Unionism
– Competition between unions for the following and
membership of the same workers
Sit-Down Strikes
• Auto, Steel and Rubber
• How do you have a successful strike when
unemployment is high?
– Solution—strike but don’t leave the plant
– Police attack on strikers threatens property of
owner
– Popular support necessary
Private Property Redefined
• NLRA
– Union organizers could come on property
– Employers had to bargain in good faith
• Sit-down strikes
– Workers trespassing but police failed to evict them
• “Property” reflected the evolving power of
capital and labor
Labor and World War Two
• No-strike pledge
• War Labor Board
– Forced union recognition
– Set wages and conditions
• Pent-up demand associated with full
employment and rationing
• War profiteering
Key Post War Economic Situation
• Bretton Woods Agreement
– Fixed exchange rates between countries
– Dollar an informal international currency
– Gold not an important international currency
• US dominant economy with a dominant position in
manufacturing worldwide
– But export economy not central to the overall US economy
(exports + imports = small share of overall US production,
GNP)
Post War Strikes
• Rosie the Riveter went home
• Male workers and returning veterans sought
the good life through he exercise of union
power
• Roughly one in three workers was a union
member
• Manufacturing = heart of the economy
• US economy dominated the world
Republican Congress Reacts
• 1947 Taft Hartley Act
– Weakens unions, strengthens employers
– Right-to-work states
• Closed shop, union shop, open shop
• Change in the members of the National Labor
Relations Board
– Really a labor court
– Judges now favor employers
Slow Decline in Unions
• Post war victories
– Higher wages
– Health and pension benefits for the first time
• But shift from manufacturing reduces union
membership relative to overall employment
• Slowly, other countries recover from the war
• Cheaper foreign imports heighten competition and
create employer antagonism against unions
Vietnam War
• War reduced unemployment and stimulated
inflation
• US began running a trade deficit
• Eventually (1971) dollar goes off the fixed
exchange system and floats (markets
determine the value of the dollar)
• 1973 first “oil shock” as price of oil doubles
– Doubles again in 1978 (second oil shock)
Stagflation in 1970s
• After the Vietnam War and the first oil shock,
economy stagnates, unemployment rises,
inflation heats up and stock market stagnates.
– Housing prices soar (baby boom grows up)
– 1974 recession
– 1982 recession
Reaganomics
• President Reagan cuts taxes a lot, cuts spending a
little, government deficit and debt rises
• Unemployment falls slowly (partly associated with
aging of the labor force)
• Great bull market in stocks begins
– Panic of 1987 short-lived (Federal Reserve pumps dollars
into the market)
• 1991 recession relatively mild
High Tech Boom of the 1990s
• Unemployment falls
• Real, inflation-adjusted wages rise after 1995
– Had been falling since 1973
– Family real income rose only because women entered the
labor force in large numbers
• Stock market rises dramatically
– Mutual funds and retirement funds feed the mania
Bubble Bursts
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Nasdaq falls by 2/3rds
Bear market
Unemployment still low but rising
Government deficits re-emerge
The Great Recession
Opening the Door to Trade
p. 34
Opening the Door to Immigration
13%
2012
13%
1920
5% 1970
p. 27
Opening the Door to Capital Flows
& Technology
Finance
Up 600%
Tech
Transfer
Up 180%
Trade
Up150%
p. 40
Open Door=Weaker Labor
Trade competition
Immigration
Falling
Wages
Rising
Profits
Runaway shops and
runaway technology
Attacks on
Labor
Wages No Longer Tied to Productivity
p. 46
Wages & Salaries as a Share of GDP Fall
Profits Rise
1947
2013
p. 49
Construction: Open Shop
Goal is Union-Free Construction
Repeal Prevailing Wage
Outlaw PLA’s
Create Construction
Guest Worker Program
Break
Unions
Merit
Shop
Universe
Political Efforts to Weaken
Construction Unions
Prevailing Wage Laws
• Repeals (1979-1995):
– AZ, UT, CO, ID, KS, FL, LA, AL,
OK, OH (schools)
• Current attacks
– WI, MI, KY, CN
Project Labor Agreements
• 10 states passed laws
outlawing or restricting the
use of project labor
agreements on public works
in 2011–2012
– Arizona, Idaho, Louisiana,
Maine, Michigan, Tennessee,
Kansas, Oklahoma, and
Virginia
Plus Construction Guest Worker Program (ABC, Chamber of Commerce) and
ALEC’s “Economic Civil Rights Act” prohibits any and all occupational licenses
Political Attack on Unions
ABC
Chamber
of
Commerce
Company
Unions
Construction
Unions
Fox News
ALEC
Think
Tanks
Tea Party
Koch
Brothers
Decline of Unions Worldwide
p. 62
US Construction Union Decline Faster
p. 64
All Trades Losing (US Data)
p. 69
Fraternal Discord
• Jurisdictional disputes
• Company unions
• Breakaway unions
Deunionization and inequality
http://www.newyorker.com/online/blogs/johncassidy/2012/04/income-inequality.html
The horizontal axis shows a measure of income inequality: the Gini coefficient. A higher Gini
indicates more inequality. The vertical axis shows a measure of social immobility The
intergenerational-earnings elasticity gauges how closely an individual’s earnings are tied to the
earnings of his or her parents. A higher elasticity indicates less social mobility.
http://www.newyorker.com/online/blogs/johncassidy/2012/04/income-inequality.html
Solution Requires Unity