Friday, February 18, 2011

The Final Relic of the American Middle Class


Government bureaucrats.  Overpaid government workers.  Pensions bankrupting state coffers.  Can't fire bad teachers.  Public workers shouldn't have unions.

I haven't heard a lot of praise for public workers these days.  Now with the news from Wisconsin, the resentment against public workers has reached its predictable conclusion.  Essentially, it's an attack on unions.

Labor unions were never welcomed by big business and violence marked much of early labor history.  Union leaders were demonized early on.  In the 1940s and 1950s they were associated with Communists.  But gradually workers gained rights and union membership grew from the 1890s through the 1970s.  It then began a decline that continues today.


1920:  12%
1930:    7%
1940:  16%
1950:   25%
1960:   26%
1970:   23%
1980:   21%
1990:  16%
 2000:  13% 
  2010:  12%  

While there appears to be a decline as early as the 1970s, union membership actually increased but the rate of entry of young baby boomers into the workforce eclipsed the gains.  (Young workers are the least likely to belong to unions.) Then Ronald Reagan fired the Air Traffic Controllers, breaking their union in 1981.  That was a pivotal point in popularizing anti-labor sentiment.

Even more telling is the make-up of union membership today.  Only 7% of private sector workers belong to labor unions while 36% of government workers do.   What has changed?  Several things.

American jobs have been decimated by the "free trade" movement.  Manufacturing specifically has few remnants left in the US.  Manufacturing made up 53% of the US economy in 1965.  By 2004, it contributed just 9%.  That's a substantial fall.   When factories closed shop here and moved to China or elsewhere, 80% of the jobs lost were union jobs.  What's left of union work in America are public sector jobs.  So far, the anti-labor crowd hasn't figured out how to outsource government.  But give them time.

At the same time, the difference between what the typical Fortune 500 CEO makes and what the average worker makes has grown astronomically.  From the 1960s through the 1980s, CEOs made 30-40 times more than workers did.  Then came the demise of middle class manufacturing jobs, deregulation of various money-making schemes, cuts in upper income tax rates and the latest anti-labor movement.  In 2001, the typical CEO made 525 times more than his workers. 525 times more.  And worker pensions and medical benefits, once the mainstay of middle class employment, have eroded in the past 30 years.

So who is to blame?  Why, those public school teachers with their health and retirement benefits of course.  In our rural area, median household income is just $35,000.  Compare this to the average teacher salary of $60,000 and the discrepancy is stark.  What's rarely published though is a comparison of salaries for jobs requiring a master degree.  Only 14% of Josephine County adults hold a bachelor's degree or higher.  The earnings of that portion of the population are not available.  But the generalized comparison is made frequently with the end conclusion that teachers (and all public workers) are overpaid.

I've been management for the past 13 years and not part of any union.  I've certainly shared frustration on occasion over the difficulty of disciplining or removing union-protected staff.  But the means were still there and I did remove some.  (More important is how we hire, not how we fire.  See:  Wrong Focus)  And I sometimes question whether professionals like teachers should have a union or a professional organization like doctors and lawyers.  (Most doctors and lawyers aren't employed by entities as large as school districts.)  I have my concerns.  But I've also seen administrators remove good teachers for political or personal reasons, good teachers whose unions couldn't protect them.

Beating up on government work is in fashion.  I get that.  But could we spend just a tenth of the energy addressing the problem of private sector work and compensation?  In 1992, Ross Perot warned of the "giant sucking sound" when American jobs left for Mexico if NAFTA passed.  He was right.  The demise over the past 20 years of private sector work and wages is our most serious issue.  If we continue placing the target on unions and encouraging factories to close up shop and move to China or Mexico, the middle class will shrink still further.

Instead, let's take the burden of providing employee health care off of employers.  Let's remove tax incentives for shipping your business overseas.  Let's actually support small businesses (most so-called "small business" programs direct payments to larger firms).  Let's reinvest in our infrastructure.  Let's restore some tariffs and so-called trade barriers.  And let's not attack the last bastion of the American middle class.  I'm embarrassed to say it but it's the folks who work in government.

9 comments:

  1. One point you are aware of is the fact that most teachers, after 6 years of college start out at about 30 grand a year. Other professions usually much higher. And they don't see the "big money" until into their 25th or 30th year. Then the retirement can be barely half of that. And no SS. And I've seen my share of great teachers let go because of pure vindictiveness. Yes, there are bad and lazy ones out there, but experience is that they get what is coming to them.
    Yes, there are some bad or lazy teachers out there but I would trade those few for the great ones that got away.

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  2. Thanks. I well remember my early years of teaching and the gap between what a beginning teacher makes and what an experienced one does. My first two years of teaching, I needed food stamps to get by.

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  3. Thank you for the intelligent discourse about a complicated situation.

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  4. I assume you are in administration (haven't read all your info). It is heartening to hear your views. I'm a retired art teacher from Ohio who is watching this whole bit of theater play out with dread. I was a member of a union and frequently disagreed with their take on issues but understood the political necessity of a counter-weight to would-be oligarchs. We're going to have to be as clever as the Republicans are on this one because I firmly believe public education is the real target here.

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  5. I am a retired union activist RN and spent many hours at the negotiating table and advocating for my peers. They were nurses that I new personally and under the same working conditions. The union gave a legitimate right to be heard. Now, because we have finally negotiated a salary commensurate with our education and skills, the health care industry is replacing nurses with lesser educated caretakers and in some cases replacing them with MD's and PA's. Has anyone noticed that the medical profession is witnessing a gender change and that new physicians are receiving less. This is only one part of an all out attack by those who are invested in keeping this country a patriarchal society.

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  6. thank you for your informative and insightful posts.

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  7. From the Economic Policy Institute: Including medical and retirement benefits, private sector workers with a Bachelor's degree earn $91,000 on average. Public sector workers with Bachelor's degrees earn $68,000. Most teachers have Masters' and the difference is still greater -- $119,000 private vs. $82,000 public. (http://epi.3cdn.net/8808ae41b085032c0b_8um6bh5ty.pdf)

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  8. I very much agree with you when it comes to teachers. On the other hand, growing up in Detroit gave me a different perspective on unions.

    I would constantly run into people with a blue-collar skill set and a white collar salary. I'm not talking about well-paid, highly-skilled technicians. I'm talking about people who clean the wrenches at the factory and earn a six-figure salary (yes, there were such people in Detroit not too long ago).

    As much value as unions can have for the laborer, they can also legitimize and promote greed. They upset the core functionality of a business, they can drive companies to bankruptcy. Unions, like any powerful force, can be used for good or evil...

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