UNIONS, ECONOMIC POWER, AND THE STATE
Kuttner, Robert
Labor unions, most progressives believe, are essential institutions of a democratic industrial society. Particularly in the social democratic model that emerged after World War II unions played...
...The best example of power sharing as a grand strategy is the Eastern Airlines bargain with the Machinists union.* The Eastern model trades wage restraint and work-rule flexibility for 25 percent worker ownership and real day-to-day empowerment...
...The understandable instinct of individual workers to resist industrial rationalization is offset in many countries abroad by creative retraining and labor-market policies...
...The value of this approach transcends merely a concessionbargaining situation...
...33 The situation of unions is particularly grim in the United States, for a variety of reasons...
...As a result, unions played only a limited role in the CETA public-service employment program when their role might have been central, and the failure to broker such a deal seeded the flaws in the program, which proved politically fatal...
...For lack of a better term this strategy might be called power sharing, and it needs to be understood primarily as a capital strategy...
...In auto, the major firms have frankly played off one plant against another, warning that as plants are phased out, only the most productive ones will be retained...
...The committee published its first report, "The Future of Work," in August 1983, and a final report, "The Changing Situation of Workers and Their Unions," in February of 1985...
...it is possible for management to manipulate an ESOP in order to take a company private...
...In the 1960s, with a friendly Congress, labor had narrowly missed winning repeal of the Taft-Hartley provision allowing individual states to opt for "right-towork" laws...
...The key test, I would suggest, is whether a co-determination bargain reflects a union-designed strategy that leads to real empowerment...
...But unionists soon saw that in health and safety, as in other arenas, knowledge is power...
...Tom Donahue, though personally committed to the idea, also acknowledges its limits...
...In the 1930s, this was accomplished through "organizing committees" such as the Steelworkers Organizing Committee, which soon matured into full-fledged unions...
...III The top leadership of the labor movement has responded to this impasse in several ways...
...Men such as John Dunlop, essentially business-oriented conservatives, could conclude that unions were simply part of the modern landscape, and spend their talents lubricating the industrial-relations machinery...
...There is one loophole in the Taft-Hartley Act's ban on secondary boycotts...
...There is no legal structure for co-determination in American labor law, and such deals as the Eastern Airlines contract with the Machinists must be handcrafted, one company at a time...
...The labor movement sought not only gains for organized workers but embodied a broader moral authority as the advocate of society's nonrich, as the constituency for universalistic social insurance, full-employment policies, and distributive justice...
...In the terminology popularized by Richard Freeman and James Medoff, unions enhanced not only workers' bargaining power over wages but also workers' collective "voice...
...This social contract—business unionism— depended on the neutrality of government, the tolerance of business and, above all, on the stability of the American economy, especially in basic industries...
...Most of the attention paid unions, in scholarly and in ideological literature as well as in the public mind, emphasizes unions simply as interest groups, not as servants of democratic aspirations or forces to counterbalance the political influence of capital in a market-oriented democracy...
...V Let us assume, based on the foregoing, that business unionism is dead...
...With this approach, the union becomes a virtual comanager, and sometimes a co-owner, of the company...
...Whiting, a former Ford Foundation executive, suggested using some public money to increase labor's competence and sophistication in health and safety matters 40 as an alternative to more policing...
...This amount of tax subsidy, if it is continued, ought to be used to promote authentic worker ownership, preferably with direct union involvement...
...There is an intriguing precedent for this approach, limited to the area of occupational safety and health, which was pioneered during the Carter administration...
...reform is indicated...
...This strategy, in some cases, seems to pay off handsomely, and it is one of the hopeful rays brightening an otherwise gloomy scene...
...The "duty of fair representation" doctrine places the unionist who serves on a company board in a conflict of interest, and actually makes him vulnerable to worker lawsuits...
...But under a more venturesome and prolabor administration, one could imagine a program of grants to support pilot labor-management arrangements whose frank purpose would be to increase the managerial and financial sophistication of unions and to devise home-grown models of co-determination...
...The study finds that 5,395 people who earned more than $1 million paid less than a 10 percent federal income tax in 1983...
...Yet the re-creation of a social contract between industry, labor, government, and society is essential, not just to build industrial democracy, but to assure that industrial nations remain democracies...
...In fact, 2,225 millionaires—one out of every nine— had a tax liability of less than 5 percent...
...As the unions become more isolated, and necessarily more inwardlooking, the perception becomes a self-fulfilling prophesy...
...Particularly in the social democratic model that emerged after World War II unions played a crucial, dual role...
...Under the sort of social contract brokered by the John Dunlops, unions renounced more radical goals, such as ownership or direct control of production, in exchange for a rising real wage, a secure, predictable set of work rules, relative job security, and industry's grudging tolerance of organized labor as a social partner...
...The law is also very murky on the issue of how unions may wield their economic power...
...The Steelworkers have tried to organize grocery clerks, to the indignation of the UFCW...
...Government inspectors continue as a backup...
...Nothing in the act may interfere with free speech, and the "corporate campaign," so far, has been able to crawl through this loophole...
...The situation today is entirely different...
...Let me begin, however, by recapitulating labor's impasse...
...The power to peer into company books, to remove a whole layer of supervisors, to make sure that production is organized and capital is invested in the interest of production workers as well as stockholders is a far more durable power than the power to make life miserable for the boss...
...They create a kind of affirmative power that proves far more durable and liberating than the negative power of traditional unionism...
...The more severely they are undercut, the more difficulty they have playing their outward-looking role as vehicles of democratic citizenship...
...Deals like Eastern admittedly arise because labor is weak, not because it is strong...
...A wide range of professional associations serves members' interests by promoting communication, helping to define common concerns, offering training opportunities, publishing wage data, and so forth...
...My mother didn't raise me to be an insurance salesman," he says...
...Again, this exercise is probably useful...
...According to Whiting, the initial reaction of some union officials was: "If the government has a spare $10 million to spend on health and safety, why don't they hire another 100 inspectors...
...Unions sought to reinforce worker solidarity and to "take wages out of competition" via industry-wide master contracts, and to defend workers' immediate interests via grievance machinery...
...As one sometime adviser to the AFL–CIO puts it, "Politically, the AFL–CIO has been like a compulsive gambler playing for a higher and higher stakes...
...Remarkably enough, it closes with a quote from one Eugene Victor Debs: "Ten thousand times has the labor movement stumbled and bruised itself...
...A further problem is the American labor movement's structural inability to transfer resources from unionized, established industries to emerging industries with little labor presence...
...Thus, allowing the union to play an expanded role in health and safety enforcement is a version of what Andre Gorz has called a "nonreformist reform"— a seemingly incremental step whose logic fundamentally changes power relationships...
...Management, by and large, adopted a course of peaceful coexistence...
...It recognizes that being bought off with periodic wage increases is no longer in the cards and that business unionism no longer even guarantees job security...
...VI 0 bviously, most of the rejuvenation of the labor movement will begin in that movement itself...
...The collapse of that social contract has left the labor movement vulnerable on all fronts...
...That tax preference will cost the other taxpayers $2.5 billion in 1986, and an estimated $4.4 billion by 1991...
...To take just one example, the report acknowledges that the labor movement needs a mechanism to draw in the majority of wage-earners who are not represented by collective-bargaining agreements...
...Otherwise, they are sometimes feared as sources of cheap, surplus labor...
...The office's resources are very meager at present, thanks to the Reagan budget priorities, and its work must be cloaked in a Republican-sounding version of collaboration...
...and of business unionism...
...If service and high-tech workers were unionized, industrial transitions would still be disconcerting to individual workers but not devastating to organized labor as a movement...
...As other such opportunities, like the UAW– Saturn deal, present themselves, it remains to be seen whether unions will have sufficient power and imagination to take advantage of them...
...Thus a period of rapid industrial transition means not only distressing personal dislocations for individual workers and communities but a transition from union to nonunion work forces...
...First, the government could use its influence to embolden labor's tentative reassertion of what used to be dismissed as management prerogatives...
...In his own rhetoric, Mondale loyally pressed labor's narrow legislative goals, but in doing so he failed to articulate a plausible case for the broader worth of a strong labor movement as a democratic voice...
...Although the semblance of industry-wide wage standards remains, concessions are extracted plant by plant...
...At the time, Lane Kirkland was concerned lest labor splinter its political influence by having some unions back Walter Mondale and others back Edward Kennedy...
...And even the most militant sort of business unionism requires a company healthy enough to generate profits to bargain over...
...In recent years, only the Farm Workers followed this approach...
...But labor's more establishment consultants, such as Victor Kamber, have put their own spin on Rogers' idea—Rogers at one point sued Kamber for appropriating the term "corporate campaign" —and the AFL–CIO has the beginning of a corporate-campaign capacity, in-house...
...It is now headed by Deputy Undersecretary Steven Schlossberg, a former UAW official who was brought in to rebuild the Reagan administration's shattered bridges to the labor movement when William Brock replaced Labor Secretary Raymond Donovan...
...Several innovative training initiatives, which might have involved unions, do not...
...One must be very careful to define and 37 qualify this approach, because, superficially, it resembles the "American Plan" of the 1920s, with its profit sharing, suggestion boxes, and company unions...
...Let us look at "corporate campaigns," labor's growing interest in pension-fund power, worker buyouts, and co-determination deals like Eastern, as all of a piece...
...In America, labor's instinctual defensiveness is reinforced by the reality that every shift from low-tech to high-tech, or from industrial to service sector, not only dislocates individual workers but depletes the unionized share of the work force...
...Moreover, most unions believe they need the prospect of better fringe benefits as an attraction for full-fledged unionism...
...In the 1980s, unions find themselves in a terrible quandary...
...Both of these campaigns failed, too...
...38 business unionists find it too radical a departure...
...The AFL was skeptical about a welfare state, and it did not even endorse unemployment insurance until the depths of the Great Depression...
...without the fundamentally adversarial relationship that Riesman and Compa cherish, class consciousness and worker solidarity melt away...
...For years, unions have looked at their latent economic power, and wondered how to mobilize it...
...And some 300 Americans paid zero income tax despite incomes in 1983 above $1 million...
...Unions have occasionally owned banks...
...In the press accounts, "industrial policy" (which is to say, planning) was interpreted as a benny for Lane Kirkland, not as an economic strategy for America to be weighed on its merits...
...The ACTWU and ILGWU have a joint program with industry to develop automated apparel technologies...
...A special assessment was voted at the AFL–CIO's 1981 convention to create a Labor Institute of Public Affairs (LIPA), to sharpen labor's media skills...
...By becoming more knowledgeable about health and safety, trade unionists inevitably found themselves tackling not just palliative issues like safety equipment and ambient toxic levels, but issues of plant design, work organization, and capital investment...
...Even in industries with weak labor presence, having a labor seat to fill demonstrates that a union or a preunion organization has a useful function...
...This has the immense value of putting the union on the side of productivity, and of reminding both the labor rank and file and public opinion generally that the worker often does know more than the boss...
...was free from low-wage foreign competition, as long as real productivity increased, and as long as wage increases could be passed along to the public rather than taken out of profits, the bargain worked...
...The task today is harder...
...From People & Taxes, August 1985 q are directly involved in the structuring of labor markets and the training of workers...
...as a second best he suggests that unions experiment with different strategies for representing worker interests, some of which simply ignore the structure of labor law altogether...
...In the middle and late 1970s, labor threw substantial resources into legislative battles to gain common site-picketing legislation, offering to sacrifice wage gains in exchange for better organizing access, and for labor-law reform, in order to put some mild teeth back into the Wagner Act...
...The New Directions budget was $10-15 million a year...
...This is also the model of some local high-tech workers' committees, and of the feminist Nine to Five...
...Some unions, such as the Steelworkers, have explicitly pursued a strategy of increasing their financial sophistication...
...In western Canada an election is held to certify the union as bargaining agent, within a week or two once the cards have been filed...
...LIPA produces television programs, conducts polls, and trains local unionists in lobbying and piblic relations...
...Like some other employeeinvolvement bargains, the Eastern/Machinists contract has improved productivity and helped put the company in the black, leading to wage restorations and profit sharing...
...The AFL–CIO report endorses "multiple models for representing workers...
...The federal government ought to devote some resources toward creating labor-management experiments that allow the hidden competence of the work force to come to full flower, and in the process to rebuild unionism as an institution...
...Masons did not go after carpenters, and carpenters did not go after boilermakers...
...Most of the labor movement is not yet comfortable with capital strategies...
...In the concession-bargaining climate, unions have been forced to give up the bedrock institution of worker solidarity, the industry-wide master contract...
...This is a point made repeatedly by many labor scholars: Wagner Act-style collective bargaining is not the only sort of collective representation one might imagine...
...The Labor Department has a small division on cooperative labor-management programs...
...Labor law in Canada is administered at the provincial level...
...As Randy Barber, a consultant to the Machinists and one of the most astute advocates of a "capital strategy" observes, "the Eastern deal transforms what it means to defend a contract...
...In contrast, the Trade Readjustment Act of the 1970s, which paid workers idled by imports, turned into a buy-off rather than a retraining program...
...If a union saw a problem, its only recourse was to call the cops...
...Carter-style tripartism failed, in part because industry wouldn't deliver its part of the bargain, in part because the Carter administration itself was divided on the wisdom of the approach...
...When one thinks of Dunlop, who epitomizes a whole generation of collective bargaining, one thinks of a brilliant broker with a very large rolodex, trusted by the captains of both industry and labor, functioning as a one-man substitute for the institutionalized tripartism that never quite took root in America...
...Elsewhere, mostly at the grass roots, the pressure of concession bargaining, paradoxically, has led some unions to move well beyond business unionism, and to grope toward a wholly different conception of unionism that could solve some of labor's problems in the larger society as well as at the workplace...
...At best, union presidents have been able to negotiate cooperative, multiunion campaigns, in which several unions mount coordinated organizing drives against different local units of a large national company, such as the Beverly nursing homes or Blue Cross/Blue Shield, and negotiate a common set of goals, a pooling of resources, and a division of targets...
...Finally, there is a whole range of laws that function as de facto obstacles to co-determination and capital strategies on the part of labor...
...But there are also many other things an administration might do to enhance the sophistication of labor, particularly in this new economic era in which capital strategies will matter as much as traditional bread-and-butter unionism...
...the weaker they become, the more they look like just another narrow interest group...
...If nothing else, circumstances are forcing experimentation...
...If this be "enterprise unionism," let us make the most of it...
...The two reports are more encouraging for what they acknowledge than for what they have yet accomplished...
...This approach turns business unionism on its head...
...A tripartite committee on steel performed useful work for a time, but industry refused to agree to reinvest substantial capital in steel modernization as its part of the deal...
...II M y main purpose here is not to go into great detail about the travails of the labor movement, which I have done elsewhere (see "Can Labor Lead...
...Arguably, even an Eastern agreement that includes substantial ownership and real empowerment pushes workers to identify their interests with those of the company rather than with other machinists...
...A * See Donna Sockell, "The Legality of EmployeeParticipation Programs in Unionized Firms," Industrial and Labor Relations Review, July 1984...
...Similarly, the Reagan administration's new Job Training Partnership Act (JTPA), the onthecheap successor to CETA, is advertised as a partnership...
...Labor renounced any claim to influence the organization of production, the investment of capital, the marketing and design of products, or other aspects of governance or ownership of capital, all of which were reserved as "management prerogatives...
...This is labor's version of a frequent-flier program, and it is one more reflection of labor's habit of trying to build solidarity on economism...
...Millionaires, of course, aren't the only ones who twist the tax code to personal advantage...
...And they may not have another play to make...
...Labor unions, understandably, are ambivalent about training programs...
...it acknowledges its problem with jurisdictional rivalries in organizing campaigns...
...The CIO had a rather different view...
...but in most communities it is just bipartite—business and government—not tripartite...
...and that unions are in a period of their history when they will do better emphasizing their function as an agency of democratic worker "voice" rather than as a force for narrow wage gains...
...It gives the union a constructive avenue to prove what unions have always contended— that the worker really is smarter than the supervisor, and a whole lot smarter than the accountants...
...New Republic, March 12, 1984), but to suggest some avenues of recovery, with particular attention to the role that might be played by the state, in a future progressive national administration...
...The apparel project, which also dates to the Carter administration, has a small Commerce Department grant, and this is another practical case of tripartism that allows labor to play an outward-looking role, and increase its sophistication about producing technologies, capital investment, and industrial strategies at the same time...
...Unlike ordinary concession bargaining or ordinary profit sharing and quality-of-worklife programs, Eastern has undergone a substantial shift in the distribution of power...
...It also can be confused with some modern versions of employee involvement used to keep unions out or to weaken those that exist...
...It is another case where the union must do the job, but the state must provide extra resources...
...The strategy proved disastrous—not only because Mondale lost badly, but because the whole endeavor reinforced the public image of "labor bosses" attempting to compensate in a smoke-filled room for their dwindling appeal at the workplace...
...Today it is more militant —and more effective...
...Looking back 20 years, it is evident that most union leaders initially saw their problem as largely political and largely external: the hal35 ance of power in the nation had shifted against the labor movement...
...There were a grand total of six industrial hygienists in the entire labor movement...
...At the same time, the committee report is guardedly receptive to some of the more farreaching innovations that have bubbled up from labor's base...
...They are increasingly seen as a selfish special interest, retarding industrial innovation, serving only union members rather than the wage-earning citizenry in general...
...Tripartite institutions are immensely useful, because they allow labor a seat at the table and, even more important, they force labor to play a forward-looking role...
...In eastern Canada, certification of the union is automatic once 55 percent of workers have signed cards...
...The New York City bailout can be understood as a strategic use of labor's capital power...
...they invite labor to 41 become better informed about industrial policy issues...
...Historically, the AFL solved this problem by rigidly delineating turf...
...The basic problem with the ESOP legislation is that it was never intended to bring about broad worker ownership, let alone worker empowerment, but only a very mild form of token profit sharing coupled with a tax preference to lower management's cost of capital...
...There is of course a third actor, with a much greater interest in the long-run health of the enterprise, and that is the work force...
...District 100 of the Machinists was always a fairly militant union...
...The AFL–CIO has been creeping up on the potential of pensions...
...Business had taken off the gloves...
...Writing in the Harvard Business Review, Barbara Riesman and Lance Compa, both veterans of the militant United Electrical, Radio, and Machine Workers (UE), warned that the adversarial character of American labormanagement relations is organic to an economic system propelled by hard-driving managers seeking to maximize profits...
...At the time, OSHA suffered from a terrible reputation of being bureaucratically onerous to industry, and too myopically afflicted with a rulebook mentality to be very effective for labor...
...Many international unions are skittish about retaining Ray Rogers, the maverick organizer credited with inventing the corporate campaign...
...Unions—throughout the industrial West—are facing declining membership, a context of high unemployment and rapid industrial transition, and diminished public support for their moral authority...
...On the other hand, union pension funds are subject to strict "prudent-man" rules under the Employee Retirement Investment Security Act (ERISA), and unions are not supposed to use pension funds for purposes other than maximization of return...
...But Swedish unionists find that their own highly trained health-andsafety teams are far more reliable than an army of bureaucrats...
...The Treasury study concludes that tax shelters in oil and gas and in real estate are the major reasons for the large-scale tax avoidance among America's wealthy...
...But it reflects the same widespread view that labor's woes were mainly external to the labor movement...
...Second, and just as important, unions served as a prime constituency for a social democratic conception of society, whether that conception was explicitly socialist or reformist...
...Elsewhere in the industrial world, unions have relied on the state to give them some institutional legitimacy but not to do their bargaining for them...
...Essentially conservative honest brokers such as John Dunlop could no longer deliver...
...This role of unionism, both in the workplace and in the larger society, has never quite received adequate notice in democratic theory...
...Even fairly modest qualityofworklife programs risk falling afoul of the Wagner Act, whose prohibition of company unions limits management involvement in any "labor organization...
...When the Steelworkers, for example, as part of the campaign against Phelps Dodge, urged other unions to fire Manufacturers Hanover as their pension-fund manager, brother and sister unions were advised by counsel not to declare they were replacing Manny Hanny because of the bank's ties to Phelps Dodge...
...But here unions find themselves up against a decade-long tilt in the structure of labor law against unions and in favor of management, combined with a new militance on the part of business...
...Advocates of labor-law reform point to the Canadian experience...
...The union gets full access to all company financial data and investment plans, and has something very close to a veto...
...What might such an administration do to help the labor movement reinvent itself...
...The trade-offs arise in a context not of domesticating a labor movement but of reinventing one...
...Certainly, labor-law reform should be a central goal of the next progressive administration...
...that the remedy is a better articulation, not a radically different movement...
...Power sharing reclaims all of the concerns that were bargained away as "management prerogatives," and it empowers the rank and file to become intimately involved in management...
...During the period of double-digit inflation, when labor costs were seen as a major ingredient in price increases, it was thought that government could help broker a "national accord," in which labor would trade off some wage gains for other institutional objectives, such as job security, enhanced collective-bargaining access, trade protection, and industrial policies for industries in transition...
...Labor Department grants went to train and subsidize industrial hygienists on union staffs, to sponsor joint labor-management reviews to improve health and safety, and to pay the cost of union "Cosh" (Committee on Safety and Health) initiatives...
...Fifty years ago, when President Roosevelt signed the Wagner Act, it provided an already resurgent labor movement with legal standing and political running room...
...The symptoms of this vulnerability include not only a decline in the unionized share of the work force but an equally serious weakening of solidarity in the labor movement itself...
...Apprenticeship in America, however, has been limited to a relatively small number of skilled trades, and it receives little public subsidy...
...It equates the union, in the minds of the rank and file and a broader public, with innovation, productivity, and good management...
...They could only point to the bank's pension-fund management performance, which was conveniently mediocre...
...He was seen as nothing but a toady for the AFL–CIO, which prompted his Democratic opponents most of whom, ironically, had prolabor voting records, to bait labor...
...Not surprisingly, such contracts leave younger workers cynical about unionism...
...It will involve a new generation of trade unionists, and there are some hopeful signs that the entrenched leaders in at least some unions are making room for new leadership...
...Yet enterprise bargaining is here anyway...
...As long as the U.S...
...management can also use an ESOP to give different classes of shareholders different voting power, and even to terminate a regular pension plan...
...The UAW (United Automobile Workers) and the Hotel and Restaurant Workers both go after university employees...
...John- L. Lewis could say, with only slight exaggeration, "President Roosevelt wants you to join the union...
...At the time, the expertise was all one-sided," Whiting recalls...
...Although a few unions, such as the AFT (American Federation of Teachers), are experimenting with associate membership as a way of reaching individual teachers in states that prohibit collective bargaining for public employees, most unions are lukewarm to the idea...
...A more venturesome labor movement might have looked at a labor insurance company the way most of the insurance industry does—as a strategic pool of capital...
...Given the desperate need to organize new workers, it might be said that the present version of labor federation represents the worst structural aspects of both industrial and craft unionism...
...In the auto industry, the UAW has pioneered joint labor-management programs, both to upgrade the skills of workers and to train workers for new nonauto jobs in anticipation of the industry's further automation...
...Politically, the unions served as the most loyal voting-bloc backing and financing for the left-of-center party, and as an ideological counterweight to both the claims of the market and the influence of capital in a political democracy whose economic institutions remained fiercely capitalist...
...This effort, too, began with a Labor Department grant (in 1979), but funds have dried up under the Reagan administration...
...In the nearly eight years since the Carter administration failed to reform labor law, the situation has been worsened by the Reagan NLRB, which is overtly antiunion...
...Until the 1930s, the "voluntarist" AFL was quite wary of state involvement...
...If nothing else, they legitimate internal self-criticism, and during the committee's two-year life this process provided a forum for a fundamental debate about strategies and tactics...
...The social contract that began in 1935 has in effect collapsed...
...The report, however, has the most enthusiasm for some new kind of associate membership status, whose initial benefits would be economic: discount insurance policies, cut-rate travel, and other such premiums...
...It has commissioned reports, and it has begun to computerize data on pension funds...
...Traditional * See the author's "Power Sharing at Eastern Airlines," Harvard Business Review, November—December 1985...
...On the other hand, the crippling limitations in CETA (the Comprehensive Employment and Training Act) were the result of the failure of the Congress, the Carter administration, and the public-sector unions to agree on a formula that would both help new workers and protect career public employees from low-wage competition...
...How indeed could a version of concession bargaining, no matter how well disguised, lead to a strengthened union...
...Under Labor Secretary Ray Marshall and Basil Whiting, assistant administrator of OSHA (Occupational Safety and Health Administration), the Labor Department devised a program of "New Directions" grants...
...The result was the grand strategy of entering the Democratic primaries, playing the role of kingmaker, and collecting substantial IOUs from the man who, it was hoped, would be the next Democratic president...
...Today, there is no "high-tech organizing committee," and there is little interest on the part of established unions in pouring massive financial support into campaigns that will not benefit the sponsoring union as an institution...
...Some professional associations, such as nurses' and teachers', have evolved into full-fledged unions...
...The combination of these twin approaches will produce something very different from the business unionism that flourished for three decades after World War II...
...Lately the incompetence and the short-run, quarterly-balancesheet mentality of American management has been widely acknowledged...
...In asking whether such deals as Eastern are good for labor solidarity, one must ask, Compared to what...
...ESOPs are now notoriously unregulated with regard to their governance structure...
...One could imagine a pool of public money reserved for joint labormanagement projects of career upgrading and lifetime learning...
...Instead, there has been a series of costly jurisdictional battles as established unions with declining memberships each rush toward the same occasional "targets of opportunity," such as public-sector workers in states with laws that permit full-fledged collective bargaining...
...in the Wheeling/Pittsburgh lockout, where an essentially healthy company declared bankruptcy to force wage concessions, the Steelworkers hired Lazard Freres, and fought the company to a standstill...
...They fought to democratize the one major institution of modern society to which the revolution of democratic citizenship never extended—the workplace...
...The New Directions program died with the Carter administration, before it had a chance to take the next logical step...
...Another response of the Kirkland era was to bolster the labor movement's public-relations capacity...
...As Quinn Mills, a labor specialist at the Harvard Business School, observes, "In 1978, the political center warmed to the idea of a 'national accord' in the context of a concern about how we domesticate union power...
...Workers may be suspicious of some aspects of unionism, but they know unions can deliver benefits," says Charles McDonald, the AFL– CIO's energetic deputy director of organizing and the man in charge of developing the program...
...that the problem was the appearance and not the reality...
...Most labor leaders would say that the single most important thing the state owes the labor movement is a level playing field—that the 39 only thing that needs to be reinvented is the Wagner Act...
...Paul Weiler, a Canadian teaching labor law at Harvard, is the most prominent advocate of a Canadian-style system as the remedy to the holes in the Wagner Act...
...There is no substantial tradition of tripartism, or of an incomes policy, of works councils, or of other legislated labor-management systems other than collective bargaining itself...
...The new job-training and retraining programs have not gone out of their way to involve unions as institutions...
...The report likes the "corporate campaign," a technique of putting pressure on an offending company's financiers, which was invented out of the necessity of the J. P Stevens organizing drive...
...Workers in heavily unionized industries are under heavy pressure to cut wages in the name of competitiveness, whether competitiveness against low-wage foreign producers as in auto, or against nonunion domestic firms as in steel...
...Weiler, who was a consultant to the AFL—CIO Committee on the Evolution of Work, likes the professional-association model, which at some point simply grows into a union...
...Obviously, the long-term solution to this isolation is the old CIO slogan, "Organize the Unorganized...
...The labor left is also deeply skeptical of this approach because it seems to defy a basic law of physics—that you can't get more power out of a situation than you can bring into it...
...Some Job Corps camps were actually run by unions...
...The Bricklayers co-sponsor a masonry institute...
...In the United States there is a long delay before the election, during which prounion workers can be harassed, intimidated, bought off, or fired...
...Workers in industry after industry have accepted "two-tier" contracts, which grandfather established workers but create an underclass of new, younger workers who may never reach previous wage and benefit levels...
...As they watched their influence ebb, they kept betting bigger pots...
...The structure of the National Labor Relations Act was no longer serving union interests...
...The first fruit of this concern was the blueribbon Committee on the Evolution of Work, whose members included the presidents of the major unions and the heads of the AFL–CIO's main departments...
...To continue to play their broader role, unions desperately need to regroup and recast a grand strategy, for it is evident that the conception of unionism operating in America since the 1930s is in deep trouble...
...It will include both new strategies for organizing the unorganized, and for strategically wielding the economic power that labor has but does not use...
...More affirmatively, a union "contractingin" committee is involved in all aspects of production, and lead mechanics have regained substantial control over the organization of work...
...In Germany, where works councils are a well-established part of the industrial system, it would be inconceivable for public debate to recognize only two parties to a takeover dispute, management and shareholders...
...In addition, as established unions find themselves with shrinking memberships, unions locked into declining industries have wandered into other unions' supposed territory...
...they are called in when labor and management reach an impasse, and they occasionally do spot checks...
...But I am attracted to bargains like Eastern precisely because they defy the laws of physics * Barbara Riesman and Lance Compa, "The Case for Adversarial Unions," Harvard Business Review, May— June 1985, p. 22...
...To be sure, there is justifiable skepticism of this approach, and criticism is heard on both the labor right and the labor left...
...In practice, the government's job-training programs have been a hodgepodge, and some have involved unions, while others have not...
...it suggests more rank-and-file involvement in organizing, and taken as a whole it suggests a movement open to change...
...43 national administration serious about a new unionism would reform the law to allow greater union use of union economic resources, and would use public resources to help engender a broader labor role...
...After the defeat of President Carter, who had failed to deliver legislatively and had never been seen as labor's own man, the AFL–CIO's top leadership concluded that nothing would succeed until labor had a real friend in the White House, a goal that had eluded labor since the New Deal...
...And to the extent that labor can do so without violating the Taft-Hartley provision outlawing secondary boycotts, labor has begun to use the leverage of the capital it controls as an organizing tactic—as it did in the J. P Stevens, Phelps Dodge, Litton, and other "corporate campaigns," where pension-fund managers were warned to sever affiliations with companies that were not bargaining in good faith...
...By comparison, the average American family pays a federal income tax of 13 percent...
...The source of power, in this view, is shop-floor struggle...
...And of course union responsibility for health and safety adds to the union's authority and stature generally...
...Here the picture is quite mixed...
...An industrial revitalization bank was proposed, but was killed by the Administration's own officials at Treasury, OMB, and the Council of Economic Advisers...
...The Employee Stock Ownership Plan (ESOP) tax preference allows companies to set up ESOPs that nominally confer a degree of worker ownership, without passing through voting rights in the stock...
...some retraining contracts have been union-directed...
...As the AFL–CIO's Committee on Work Organization hints, the next Democratic administration should experiment with a wide variety of tripartite institutions...
...In other industrial nations, with Sweden pioneering, trade unionists are the front line of health and safety enforcement...
...There are other examples of pioneering "lifetime learning" and career upgrading programs directly 42 sponsored by unions, such as the SEIU's (Service Employees' International Union's) Lifelong Education and Development program, which is designed for relatively low-level health-care, clerical, and janitorial employees...
...In general, American labor law presumes an adversary relationship that precludes unions playing a role in management...
...In Ohio, where new state legislation allows full unionization of public employees, the CWA (Communications Workers of America), AFSCME (American Federation of State, County and Municipal Employees), The National Union of Hospital Workers, and the UFCW (United Food and Commercial Workers) all poured scarce energies into campaigns against each other...
...First, of course, unions served as direct instruments of industrial democracy...
...It is a dynamic sort of power that breeds more power...
...But to read the mainstream debates about how to remedy this, one would think that the choice is either to tolerate managerial ineptitude or look for redress to such corporate raiders as Carl Icahn and T Boone Pickens...
...This, of course, will be even more difficult during a period when labor is on the defensive...
...Some jointly administered pensions, mainly in the building trades, have created investment pools to finance construction projects for union contractors...
...But the view that the state ought to play a minimalist role in industrial relations, except as honest broker, remains the mainstream view in America...
...I know of one worker-run enterprise that actually managed to get some JTPA training slots, but this was because of some clever local grantsmanship, not thanks to a policy priority...
...To ask workers to loosen their bonds to the union and tighten those to the company under the rubric of labor-management cooperation is to ask them to break faith with one another.* Power sharing is suspect because it turns the worker into a petit bourgeois, and at best it accepts something labor has always opposed— enterprise unionism...
...In several of the nations with the most effective union movements, such as Sweden, Austria, and West Germany, unions have preferred to work out their bargains with industry directly, without a strong bargaining role for the state, which enters only when there are bargaining impasses...
...The Communications Workers, once closely tied to the Bell System, have gone after public employees, annoying AFSCME and SEIU (Service Employees' International Union...
...that to flourish in the current economic climate unions must acquire much greater economic influence both as an organizing strategy and as a representational strategy to defend organized workers...
...Which is to say, "management prerogatives...
...During the same period, however, some of the AFL–CIO's top leadership, notably SecretaryTreasurer Tom Donahue, began urging more fundamental changes in labor's own strategy...
...A few unions, such as the Bricklayers, ACTWU (Amalgamated Clothing and Textile Workers' Union) and the ILGWU (International Ladies' Garment Workers' Union), have perceived the potential of working with their industry counterparts to develop new technologies...
...Much of the management personnel literature concludes that few companies pay systematic attention to their "internal labor markets," that is, efforts to encourage their low-level employees to advance...
...And if unions are in trouble, then a democratic left politics is in deep trouble, too...
...A union campaign against an insurance company that is financing a law-breaking employer is not considered a secondary boycott under Taft-Hartley...
...Unions in America are concentrated in older manufacturing industries and in the public sector...
...these banks have sometimes been abused, as have a few union pension funds...
...Government funds might be used to train unionists to play a variety of management roles, going far beyond health and safety, and in the process make labor a genuine social partner...
...It is significant in this regard that the AFL–CIO Committee on the Evolution of Work studied the insurance industry, with an eye to benefits for workers in their role as consumers, not producers...
...The building trades, in particular, are appalled at the prospect of the AFL–CIO offering a nice, union-sponsored package of fringe benefits—to nonunion "associates...
...Eastern, two years after a "concession contract," once again has the highest-paid machinists in the industry, though thanks to substantial productivity gains it does not have the highest labor costs...
...But the state does play a crucial role, via public policy and legal framework, in creating institutions that allow labor to function as a fruitful social partner...
...When Kennedy pulled out of the race, the AFL–CIO was left, by default, with Mondale, a loyal legislative friend but a far less exciting candidate...
...At first, the grand strategic response of the AFL–CIO nationally was to redouble its efforts in the political arena, in order to right the power imbalance...
...Unions have only limited authority over pension funds...
...JTPA, at least, allows unions and companies to obtain funds for jointly designed programs...
...The state, I have argued, also has a very important role to play, as a midwife...
...In effect, the penalties for harassing or firing workers who sign union cards have become so light and the delays so long that the Wagner Act and the National Labor Relations Act are, on balance, impediments to union organization...
...Let us further suppose, if this doesn't strain credulity utterly, that a progressive administration will eventually regain the White House...
...Under that social contract, as legislated by the Wagner Act, enforced by the militance of industrial unionism, refined by wartime labor-management collaboration, and then reined in by the 1947 Taft-Hartley Act, unions limited their struggle to highly ritualized and legalistic collective bargaining for shares of corporate profits...
...the left finds it too collaborative...
...Where the union can control them, they are welcome...
...A generation of corporate managers came to terms with business unionism...
...There is little support on the AFL—CIO council for either CIO-style arbitration or AFL-style territoriality...
...Weiler acknowledges that the political prospects of such a reform are presently slender indeed...
...Another area where the state might help the labor movement to play a more important role is the now fashionable arena of job training and retraining...
...But you can't have good health and safety just by relying on the cops, and you'll never have enough cops...
...The Carter administration did experiment with tripartism in a number of guises...
...The final report opens the door to radical 36 change, but cautiously...
...Workers own but do not control hundreds of billions of dollars of pension funds...
...Since business unionism was sold to its membership mainly as a force for better wages, benefits, and job security, the sudden inability of unions to deliver any of these objectives has 34 left the labor movement unsure of its raison d'être and ideologically disarmed with both the general public and with its own rank and file...
...The report also proposes a pilot project to try out 1930s-style organizing committees...
...It also provided some breathing space for the young Turks in the labor movement, useful sources of labor energy who are often dismissed as mere "dissidents...
...Nearly 30,000 households with incomes above $250,000 managed to pay a tax of less than 5 percent, and 1,900 such households paid no tax whatsoever...
...In some future administration, one could also imagine job-training money being targeted to employee-run ventures, or used to teach codetermination to trade unionists...
...Unions conventionally are seen as enemies of automation, but in this case the needle-trades unions have perceived that if advanced technologies and higher productivity can keep some jobs in the U.S., it is preferable to losing the entire industry to cheap labor...
...One might say, after Churchill, that if Eastern was an opportunity in disguise, it was certainly well-disguised...
...it is not to legally recognize and channel a power that has established itself de facto, but to help rebuild the movement itself...
...It gave the labor movement a stake in oligopoly...
...Although Article XX of the AFL—CIO constitution prohibits "raiding" of established bargaining units, it has no formal process for awarding one union new organizing territory and keeping rival AFL— CIO affiliates out of each others' way...
...Not surprisingly, it enabled workers in such heavily organized industries as auto and steel to win wage increases that far outstripped the average gains...
...Apprenticeship offers a model in which unions One out of every six millionaires pays little or no income tax, according to a new study by the Treasury Department...
...The CIO solved this by creating new unions for new industries, and insisting on compulsory arbitration in the case of jurisdictional disputes...
...Associate membership raises jurisdictional worries (associate member of what...
...Fulfilling this function is a very natural role for trade unions, one that can improve both their image and the substance of their activities with the broad public and the rank and file...
...Mass layoffs have undercut unions' ability to defend the most basic right of all—job security...
...Management's ability to retaliate, almost at will, against workers who sign union cards has amounted to a de facto repeal of the Wagner Act...
Vol. 33 • January 1986 • No. 1
