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Fighting for a High-Wage America

24 October, 2017

Politicians talk endlessly about jobs, but few seem to understand what UE members know from our own workplaces: good jobs do not come from the generosity of bosses, but from the hard work and creativity of working people, organized into strong unions and backed up by good public policy.

The progressive, nonpartisan think tank The Century Foundation aims to change the national conversation about jobs, especially in manufacturing, with their new “High-Wage America Project.”

Launched in June, the project starts from another lesson that UE members have learned from hard experience, that corporate and political elites in the U.S. have made deliberate choices since the 1970s to turn our nation into a low-wage society.

Last week, the High Wage America project held their first regional summit, “Manufacturing a Better Paying Pennsylvania,” in Pittsburgh.

Progressive economist and High Wage America Project director Jeff Madrick denounced mainstream economists who talk about the destruction of good jobs and increasing inequality as somehow “inevitable.” Instead, he said, inequality is increasing because the Federal Reserve deliberately kept the unemployment rate high, and because the federal government, in the grips of “free market” ideology and faith in “free trade,” has abandoned any attempt to create a coherent, pro-worker industrial policy for the U.S.

The premise of free market ideology, Madrick said, is that workers will get paid fairly because of “market forces.” As any UE member who has ever been in negotiations knows, workers rarely get paid fairly unless they organize and demand it.

One of the results of basing policy on these flawed economic ideas, Madrick pointed out, is that while manufacturing workers in the U.S. earn more than other U.S. workers, they earn significantly less than manufacturing workers in Europe.

Madrick suggested that, in order to transform the U.S. into a high-wage society, the government at all levels should develop a robust program of public investment in infrastructure, improve the quality of K-12 education, and increase access to college and job training. Importantly, he stressed that labor policies — increasing the minimum wage and strengthening collective bargaining — are just as important as investment and education in creating high-wage jobs in manufacturing.

The conference was also addressed by several labor leaders, including Steelworkers President Leo Gerard, who spoke about the importance of “holding on to what we’ve got” by preserving existing union jobs, and director of the AFL-CIO Industrial Union Council Brad Markell, who reminded attendees that 40% of U.S. manufacturing workers make less than $15 per hour, and 11% are temporary workers. He also pointed out that “health care costs are the monster” in terms of costs in the manufacturing sector, which underscores the point that UE has long made, that a single-payer, Medicare for All healthcare system would be good for the economy as a whole (The Century Foundation’s program for Building a High-Wage America includes support for Medicare for All).

An “Industrial Commons”

The notion of a commons is rooted in the historical practice of community members benefiting from the common use of shared town lands to graze their animals. The modern-day equivalent of a commons for industry includes sharing of specific resources: the research and development and manufacturing infrastructures, including the know-how, process development skills, and engineering capabilities, as well as access to suppliers of advanced materials, tools, production equipment, and components necessary for retaining, restoring, and growing new industrial capacity in specific sectors and geographical locations.
—from Revitalizing America’s Manufacturing Communities, Joel S. Yudken, Thomas Croft and Andrew Stettner, The Century Foundation, 10/16/2017

Tom Croft, the director of the Steel Valley Authority, spoke about how the current focus on jobs and manufacturing is an opening to talk about industrial policy. He declared that Pennsylvania has been devastated by “man-made disasters,” driven by decisions made on Wall Street, in Washington and in corporate boardrooms. He suggested that strengthening and creating regional jobs authorities like the SVA could provide an “Industrial Commons” of shared resources and capacities that would sustain a revived manufacturing base in Pennsylvania and other heartland states.

He also recognized former UE Local 610 Chief Steward Charlie McCollester, who helped found the SVA in the 1980s.

Economist Stephen Herzenberg, the director of the progressive Keystone Research Center, described the man-made disaster of deindustrialization that hit Pennsylvania in the 80s in stark terms. Working people in Pennsylvania suffered a collective wage drop of $3.50 per hour during that decade. Mainstream economists, he charged, are “deaf to the destruction” that their theories cause in working-class communities and “blind to the market failures” that wreak havoc on working people’s lives.

“It’s just crazy,” said Herzenberg, describing the prevailing approach to economic development, in which local and state governments try to lure jobs away from other localities with tax breaks and subsidies. Governments are spending money writing checks to individual companies while “massively under-investing” in the kind of infrastructure that has been demonstrated to be more effective in supporting small and medium manufacturing enterprises. “We’re chasing instead of building,” he said.

Companies’ location decisions, he said, are often based on fads. While there are ways to change policies to make “reshoring,” or moving manufacturing jobs back to the U.S., more financially attractive, the U.S. also needs to make a values-based decision to produce goods in the country.

Shaping Our Own Society

Harold Meyerson, editor of The American Prospect, contrasted the “growing sentiment that American capitalism isn’t working very well” with the decreasing power that working people have to shape the economic structure of society. The decline of worker power, he noted, is not just limited to the fact that 93.6% of private-sector workers are now non-union and thus can’t engage in collective bargaining. 65 million American workers, he said, can’t even bargain over wages individually because they have been forced to sign “non-competition” agreements, are temps, or are misclassified as “independent contractors.”

This decline of worker power has led to a redistribution of wealth from labor to capital, from working people to wealthy bosses and shareholders.

Madeline Janis, the director of Jobs to Move America, emphasized the importance of exerting democratic power over the private sector. She described the ways cities such as Los Angeles have used public procurement policies to create good manufacturing jobs locally. Public procurement, she noted, is over $2 trillion per year, and makes up 12% of gross domestic product. The purchasing and bidding processes for public procurement, she suggested, can be used to enact progressive and pro-worker policy goals.

One of the themes running through the conference, especially in remarks by Janis, Pittsburgh City Councilwoman Natalia Rudiak and Allegheny County Council Member DeWitt Walton, was the importance of ensuring that jobs in manufacturing go to people, especially women and people of color, who have often been excluded from good jobs. Markell, from the AFL-CIO, noted that the decline in manufacturing employment in recent decades has disproportionately hurt African-American communities, and numerous speakers addressed the challenges faced by women seeking employment in manufacturing.

As UE members expressed at the recent 75th convention, “We are at a critical juncture in U.S. history where the working class faces both tremendous challenges and tremendous possibilities.” The work of The Century Foundation and others points the way towards a progressive, pro-worker industrial policy that, if enacted, could preserve and expand UE jobs in manufacturing, and provide prosperity and economic security in working-class communities across the country.

Further Reading

Op-ed: “How to revive manufacturing in Pittsburgh,” by Stephen Herzenberg of Keystone Research Center and Andrew Stettner of The Century Foundation.

An Agenda for Growing High-Wage Pennsylvania Manufacturing Jobs, by Keystone Research Center

Research and Commentary from The Century Foundation: