What unions did for America. We should miss them.

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by Fabius Maximus

Summary: Americans consider a prosperous middle class to be our just due. We forgot how generations of union activists helped create it. The middle class existed for only a few generations, and survived the crushing of unions by only a few decades. On this Labor Day let’s remember the lost history of the union movement, learn from it – and do better in the future.

Union: bargain or beg


The rise and fall of unions.

In the mid-1970s Cornell’s School of Industrial and Labor Relations (ILR) was a key part of the labor movement. Its graduates were the vanguard of the labor movement – trained to continue the progress of the previous 110 years. The progress that had played a large role in building America’s large middle class. The ILR students I knew were idealistic, hard-working, and confident they were on the winning side (it was the 1970s).

The ILR students were trained in the social and political sciences, and in business. They did not know they should have been studying strategy and tactics from the West Point curriculum. Corporate leaders had decided to roll back the New Deal, and breaking unions was a key part of that. War, of a sorts, had been declared – an undeclared war, lavishly financed by patient capital, and one executed by people as talented as those from Cornell’s School of Industrial and Labor Relations.

Forty years later the union movement is broken, with the last bastions – such as government employees – now under attack. It was one of the first institutions to fall in the ongoing collapse of America’s institutions (see A new, dark picture of America’s future).

Labor Unions

The rise of America’s middle class

“To remember the loneliness, the fear and the insecurity of men who once had to walk alone in huge factories, beside huge machines. To realize that labor unions have meant new dignity and pride to millions of our countrymen. To be able to see what larger pay checks mean, not to a man as an employee, but as a husband and as a father. To know these things is to understand what American labor means.”

— Adlai Stevenson’s speech to the American Federation of Labor in NYC on 22 Sept. 1952.

The middle class was not a gift to us from the Blue Fairy. Instead of “Bibbidi-Bobbidi-Boo”, workers mobilized against their employers. It took generations after the Civil War to build America’s middle class, and unions were a large factor making it happen. They provided organization, political muscle, money for research, and trained people to counter the massive institutional power of corporations.

It was a long bloody struggle, For a blow-by-blow of unions’ rise see this series by Erik Loomis (Assoc. Prof of History, U RI). The toll paid by union members – in time, work, and often blood – is as much a cost of building America as that paid by the members of our armed forces. Here are some of the battles in this long struggle.

Struggles during the long decline.

In response corporations organized cartels to fight their workers and raise prices for their customers. They bought politicians in bulk. This was part of their plan to roll back the New Deal. It has been very successful

Labor Stands for All Who Work - Vote Labor

Throwing away the gains from 110 years of struggle

Gains from generations of struggle were lost carelessly in a generation. Many unions were internally weaker than they looked at their peak, with widespread corruption, stupid and greedy leaders, and infiltrated by organized crime. This made the successful counter-revolution by corporations much easier.

As a sign of their brazen return to power, mega-corps have re-instituted illegal wage cartels: such as those reveal among technology companies and entertainment companies – plus those we don’t know about (these are easy to hide if done informally). What will America look after another generation of corporate attacks on workers?

The fall of unions was a major factor undermining the middle class.

Since 1970 wages have been falling as a share of Gross Domestic Income (GDI); since 1990 profits are rising. See the graphs below. The reasons are complex, the result has by now become unmistakable: a shift of our national income from return on labor to return on capital. Since the nation’s wealth is so highly concentrated, the result is rising inequality of income.

The actual decline of workers’ pay is worse than shown in this graph, since these “wages” include the vast sums paid to senior corporate managers – sums beyond anything seen until 1980s. Click to enlarge.

Compensation of employees as share of GDI

Profits as a share of Gross Domestic Income fell for generations, reversing after 1990. Since then every day is Christmas for plutocrats! Click to enlarge.

Corporate Profits as percent of Gross Domestic Income.





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