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The fall in union representation and the increase in inequality. A history of the USA

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Translation from Politikon – This is a graph that never gets enough attention: the percentage of workers in private companies in the United States who belong to a union.

The evolution of unionism and the labor movement in the United States is one of those stories that were born partly at random and that have had a huge impact on the country’s economic structure in the last 80 years. Let’s see why.

The Wagner era

In this chart, we have three different eras, each marked by a legal change. The first, from 1935 to 1947, is the years of National Labor Relations Act 1935 (the Wagner Act), one of the key parts of the New Deal . The NLRA was designed explicitly to facilitate and favor the creation of unions, seeking to equalize the bargaining power between workers and companies. The law created a mechanism to allow the founding of unions and a federal body, the National Council for Labor Relations , dedicated to overseeing the process.

The law formalized the basic guiding principle of relations union and business, the contract, the final product of a negotiation between the two agents that produces a document of full legal value. It also formalized something that would be a constant component of the American labor movement and that would become its Achilles’ heel: contracts are valid for companies or cover a certain professional category within a company. They are not sectoral.

During the years that the legislation was in force, however, this detail was not very important. The massive mobilization of World War II gave workers tremendous bargaining power. This, combined with an administration clearly on the side of employees, contributed to a massive expansion of unionism in the country.

In 1945 and 1946, this also caused a great wave of strikes and labor unrest. When the Republicans regained Congress in 1946, they decided that things were getting out of hand and that communism was imminent, so they pushed the Taft-Harley Act to pierce that balloon.

Taft-Harley: Communist Fighters

Taft-Harley it is one of those laws that apparently are not very aggressive, but that their implementation and legal development end up making them crucial. In principle, all TH does is to prohibit several “unjust union practices”, such as solidarity strikes, wild strikes (one of my favorite expressions) and mass pickets. He also banned so-called closed shops, union contracts that made unionization mandatory to work in a company.

The two most significant changes, however, were more subtle: banning direct donations to federal political campaigns and allowing states to pass “right to work” laws. The first part is significant because it eliminates the possibility for unions to articulate with candidates in something like a labor party. While they have continued (and continue to) intervene in politics, they have to do so with independent political action committees, not officially endorsing candidates.

The second part focuses on an important detail. Until 1947, unions could negotiate contracts that included a clause that required all employees included in the contract to pay a union fee, regardless of whether or not they were members. Taft-Harley allows states to ban such a clause, allowing employees to choose not to pay, but still receive the benefits of collective bargaining. This creates situations in which a union in theory may try to represent workers, but has no resources to cover the costs of a negotiation that employers inevitably try to make as expensive as possible, weakening their bargaining power.

At laws of right to work spread rapidly, especially in the southern states. The idea that black and white workers could share a union was something that seemed so reprehensible to many who preferred to end unionism before mixing races.

The Taft-Harley impact, however, was not immediate. During the 1950s, the height of American imperial power, the unemployment rate was so minuscule that workers still had considerable bargaining power. In a world where America’s industrial power was unquestionable, companies could afford to be patronizing. In addition, regulators were still new negotiators , so the NLRB continued to not be too hostile. There was some drop in membership, especially in the South, but the power of the union movement remained.

Nixon, again

The change came, as in so many other things, due to an old acquaintance: Richard Milhous Nixon. The oil crisis interrupted the uninterrupted sequence of decades of full employment in the United States, just when the national industry started to have to compete with Germans and Japanese. Due to the historical accident of corporate health insurance that we talked about once, labor costs per worker, especially in companies with strong unions, were higher than in countries with welfare states. Social activism in the 1960s also made unions more militant, expanding their bases to include women, Latinos and blacks.

Nixon did not change a comma at Taft-Harley. What it did do was appoint five reactionaries to the NLRB, allowing companies to act much more aggressively against any attempt to form a union.

For example, one of TH’s provisions allows employers to set up anti-union advertising campaigns when someone is trying to organize one in the company. In the weeks leading up to the unionization vote, an employer can force workers to attend briefings about the horrors of unionism and how, if they vote badly, they may have to close the factory and go to China. Changes in jurisprudence in fact eliminated the traditional method of collecting signatures (card check) to unionize, forcing voting with ballot boxes, where the employer can press much more.

Most significantly, the federal government simply stopped penalizing companies that violated union rights. In theory, it is totally illegal to fire a worker who is trying to form a union, which regulates the type of “anti-union education” that companies can promote. In practice, the federal government approved everything and, when it acted, the penalties for violating these rights were and are ridiculous. The NLRA was originally an agency that had to defend workers’ rights in labor disputes, when a company did something atrocious, it was the NLRA that represented the worker. Nixon first, and Reagan later, simply stunted the agency to the point of being inoperable.

Companies were quick to notice these changes. As this great EPI article shows, from which I got much of what you are reading, in the United States there is an industry of consultants, lawyers and MBAs who make a living helping companies to suppress any union attempt. They are people who know the tactics, strategies and legal limits in detail and apply them with energy. If you want to see them in action, the fantastic documentary American Factory (Netflix) has a perfect example of one of those legal battles.

Opportunity and inequality

Here we are today, in a country where private sector workers have little or no ability to negotiate anything with companies on an equal footing. We know (because there are dozens of studies that prove it) that the drop in union representation is one of the main causes of the brutal increase in inequality in the United States. This Nixon-era regulatory shift and its continuation under Reagan was virtually invisible and required no law in Congress. Its effects, however, were enormous.

It is worth mentioning, as a final note, how accidental has been the evolution of the American union movement. The European tradition of negotiation and sectoral agreements does not exist in the United States not because of a political decision, but because of a judicial decision. O National Industrial Recovery Act of 1933, the predecessor of the NLRA, included something similar to this structure, but the Supreme Court declared it unconstitutional in 1935 and Roosevelt changed course.

A significant part of the huge economic inequalities in the United States, therefore, is the result of a court decision on a matter adjacent to union representation and five regulators appointed by Richard Nixon. So that later they say that politics doesn’t matter.

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Economy

Argentine President contaminated by covid-19 and fulfills isolation

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São Paulo – The president of Argentina, Alberto Fernández, informed on social media that he tested positive for covid-19, after showing symptoms of the disease. He said he is in isolation and has warned people with whom he has had contact in the past 48 hours. And he also reported that he had 37.3ºC of fever, in addition to feeling a slight headache.

The announcement was made this Saturday (3), the day after Fernández turned 62. “For everyone’s information, I am physically well and, although I wanted to end my birthday without this news, I am also in a good mood,” said the president.

He received the first dose of the vaccine (Sputnik) in January. The second, the following month. “I’m fine, I don’t have any symptoms. Only this fever from yesterday that I reported ”, he declared to the newspaper Clarín. “It is a very complicated virus, and the demonstration is that I got infected, even though I was vaccinated with both doses and with extreme care,” he added.

Former President Luiz Inácio Lula da Silva, who received the second dose of the vaccine today, sent a message of support to “Daqui do Brasil I send good energy, hoping for its prompt recovery. May soon overcome this disease to continue caring for the Argentine people. Hugs, mate! ”He wrote.

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