Income inequality is perhaps the largest roadblock limiting the ability of everyday wage earners from attaining the American Dream.
In 2014, U.S. Sen. Marco Rubio observed that “From 1980 to 2005, over 80% of the total increase in income went to the top 1% of American earners.” And the impact of the Great Recession and its recovery has only made income inequality worse.
Has it always been this way? In a word, NO. In the nation’s peak period of union membership following the end of WWII, income inequality was greatly reduced from the earlier period of the Roaring Twenties and the Great Depression.
In the postwar period ending in 1973, our nation’s economic might was never more broadly and fairly shared. Each quintile of the workforce saw its real spendable income roughly double. No wonder some people think of this period as the “Good Old Days.”
What’s the most effective tool for reducing income inequality? Organized labor. History shows that a mutually negotiated collective bargaining agreement (CBA) is the single best tool for narrowing the wage gap, especially for marginalized earners, thereby insuring dignity, respect and civility in the workplace. And since 1935 with the passage of the National Labor Relations Act (NLRA), it is the policy of the federal government to encourage union organizing and the negotiation of legally binding CBAs.
Sadly, the NLRA was celebrated by Martin Levitt, a union avoidance attorney, as being “his friend” in helping employers keep unions out of their workplaces! Why? As Levitt explains in his book, “Confessions of a Union Buster,” there are no significant penalties for employers who violate the law to thwart union organizing drives.
That means that the Protect the Right to Organize Act (PRO Act), which amends the NLRA and is currently for consideration by Congress, is perhaps the most significant legislation empowering everyday wage earners since the Great Depression!
And predictably the employers, employer associations and their allies in elected office are recycling the same arguments against the PRO Act that they used in opposing the NLRA back in 1935.
We are living through a period where Gallup Polling shows a 65% approval rating for unions, and an MIT study says 60 million people would join a union if given the opportunity.
And what wage earners achieve through a union, employers should already be doing: making the workplace safe and healthy; ensuring employees get the training needed to do the best job possible; achieving fair pay and benefits; and treating its workforce with decency, civility and respect. Sadly, the way the economy is organized encourages employers to think 24/7 about maximizing quarterly profits.
Unions are vital to the nation’s economy. How? The “Best Friend” of Main Street merchants is a well-compensated workforce. Millionaire investment broker Nick Hanauer put it this way, “The fundamental law of capitalism is: When workers have more money, businesses have more customers. Which means middle-class consumers — not rich business people — are the true job creators.”
What would the PRO Act do? Empower the National Labor Relations Board (NLRB), which administers the NLRA, to support the national policy that promotes unionization and collective bargaining.
It addresses the inadequacy union avoidance consultants use by allowing the NLRB to levy fines against employers who violate the law. It would eliminate the employer’s ability to have forced meetings of the employees to hear hours of anti-union propaganda. It would guarantee mediation of a first contract after a union is recognized and negotiations hit an impasse. It would make it illegal to permanently replace union workers when they choose to strike over wages, hours and terms of employment. It would end the employer practice of misclassifying employees as supervisors or independent contractors (as often happens in our “gig” economy) to keep them from the protection of a CBA.
With enactment of the PRO Act, a return to the “Good Old Days” becomes possible.
John Kretzschmar is director of the William Brennan Institute for Labor Studies at the University of Nebraska at Omaha.