The struggles in Madison have understandably focused attention on the wages and working conditions of public sector workers. Thankfully, it appears that these struggles have helped to promote greater solidarity between public and private sector workers. Now, we must build on this new solidarity to focus our collective energies on the bigger challenge: transforming a system that demands that workers (in both the public and private sector) accept ever worsening living and working conditions.
As many involved in the Wisconsin struggles have pointed out, there is plenty of wealth being produced—the problem is that those who are doing the producing are being increasingly denied access to it, both collectively and individually. For example, as the Economic Policy Institute points out:
U.S. productivity grew by 62.5% from 1989 to 2010, far more than real hourly wages for both private-sector and state/local government workers, which grew 12% in the same period. Real hourly compensation grew a bit more (20.5% for state/local workers and 17.9% for private-sector workers) but still lagged far behind productivity growth.
The chart below highlights this development. As one can see, the real issue isn’t whether public sector workers make more or less than private sector workers (and the chart covers compensation which includes pay and benefits). Rather it is that workers together have been increasingly productive but receving an increasingly smaller share of the fruits of their labor. Those who are well place to benefit, those at the very top of the income scale, have of course done quite well. For example, the richest 1% received 56% of all the income growth between 1989 and 2007 (before the start of the recession). By contrast the bottom 90% got only 16%.
If we want to change this we are going to have to build a powerful political movement, one that is prepared to take on the powerful interests that are determined to keep spending on the military; privatizing our educational, health, and retirement systems; promoting corporate mobility; weakening labor laws; and confusing us all about the causes of existing trends.
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Comments 18
pduggie — March 28, 2011
I wonder what increasing productivity means for workers.
For an unskilled worker, does it mean that technology makes his job even easier and require less skills to perform? If so, then he becomes even more interchangeble in the system than if he were less productive.
Is it really a worker who is more productive, or a worker plus the more productive capital she is using that is more productive.
If bob uses a hand tool to make a widget, he can make 100 widgets.
If he's given a power tool by his employer, he can make 1000 widgets in less time.
Why would he be paid more? there is even less need for his particular services.
Jen — March 28, 2011
Frankly, we have got to move this beyond the ballot box, beyond recall elections and judicial campaigns.
We need a rebord labor movement. Strikes and all - we can't really scare the boss if we don't have a willingness to put our hands in our pockets and cease to produce wealth for him.
Remember the Bayview Massacre, the Haymarket, the Triangle Shirtwaist Factory. POWER CONCEDES NOTHING WITHOUT ACTION. We don't get decent working conditions, overtime pay and weekends off because the company we work for is generous and nice and loves us. We have those things (for now) because of people who dared to take risks - and sometimes died - for those things.
AlgebraAB — March 28, 2011
It doesn't make sense to me to discuss changes in dollar-denominated wages or productivity (however they're measuring that in this particular paper) without analyzing the macro conditions that dollar exists in first.
I'm extremely skeptical of any claims about gains in the productivity of American workers simply because the dollar's status as the world's reserve currency gives the American economy a great deal of privilege that no other economy really has. The Federal Reserve can issue trillions of dollars in new money through quantitative easing, allowing a great deal of American debt to be wiped out and propping up the federal government's deficit spending, while shielding itself from the inflationary pressures and austerity that any other country would face under those conditions because the rest of the world HAS to absorb those new dollars if they want to keep their trade with the U.S. stabilized. On top of that, corporations and banks are making untold amounts of wealth off of the carry trade/arbitrage with foreign currencies and bonds. I consider it straight-up highway robbery of the Third World, but there is not much those countries can do without either an extremely traumatic break from the U.S. consumer market or incurring the U.S.'s military wrath.
I'd be willing to wager that if the dollar were replaced as the world's reserve currency, not only would the deficit spending that allows Milwaukee teachers to make $80,000 a year be simply physically impossible but the standard of living of almost every American, including the very poorest, would be substantially diminished. And, all of the claims about productivity gains would go up in smoke as being as illusory as home prices were after the bubble. Just because the Federal Reserve is loaning out money at 0% interest, allowing corporations to make 12% profit instantly simply by performing arbitrage with the Brazilian real or whatever, does NOT mean that the workers of said corporation are 12% more "productive." If American unions do believe that their workers are as productive as they think they are and they do believe that China is enacting "currency manipulation" (apparently quantitative easing isn't) then the solution is simple: stand behind the creation of a global reserve currency, probably a basket. It's that simple - put your money where your mouth is!
Unfortunately there is practically no one on the left who is willing to challenge the Greenspan-Bernanke status quo. People either have no clue or they aren't willing to turn over the gravy train.
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