America used to be in love with its unions. In recent times however, their power and support has been chipped away. The volatile conflict between Wisconsin's Governor Walker and union supporters earlier this year represented the change that has occurred in the American psyche.
The whole way we work is undergoing a transformation in the U.S and around the world. France, Germany and the UK are reexamining worker entitlement programs amidst continuing economic stress. Americans and Europeans are asking what should governments provide for working people and the unemployed? And what should entrepreneurs and employers provide?
Among non-union members, there is little or no job security in the U.S. If you are a C-Suite corporate employee and have been lucky enough to negotiate a lucrative exit package -- good for you. On Wall Street, in media, tech and the corporate world, you often receive several months' severance when laid off. But without a well-heeled employer or a union rep behind you, most Americans are relegated to the unemployment lines. If you are self-employed, you don't even have that.
In New York, it doesn't matter whether you earned $40,000 or $400,000. You will still receive the same $400 unemployment insurance check each week. In Seattle, you might receive $650. Each state makes its own rules on how much to add to federal and employer contributions. You receive nothing in terms of health insurance except the opportunity to pay for it yourself for a year under COBRA. The unemployment extension of 99 weeks is about to end this January despite the fact that the nation's new job numbers remain dismal.
Bad Hair days: 20th Century
Anyone over the age of five in 1981 will probably remember the catchy television jingle: Look for the union label. A smiling group of matronly seamstresses with bad hairdos and men in polyester leisure suits sang the harmonic praises of American-made clothing. They sang that their wages went "to feed the kids and run the house." They assured us they worked hard and didn't complain; they were simply "paying their way" as citizens. A spokeswoman defended the exalted union label this way: "It tells you that we are able to do what every American wants to do, have a job doing honest work at decent wages."
The concept of "an honest job for honest wages" is almost quaint these days. In the wake of the enormous displays of gluttony and greed from Enron on, the past decade has thrown our hard day's work ethic under the bus. Entitlements? Out. Hard labor? Only if you can get $40 an hour plus benefits.
Making a living became so much more challenging in the Flat world for Americans. That is one of the primary reasons that mortgage money became the economic lifeline for a homeowning middle class. Manufacturing jobs, once the backbone of the U.S. economy, have been transferred out of the country in massive quantities since 1978 according to Thomas Geoghegan, author of Infinite Debt .
Few would question the amazingly challenging jobs that firefighters and police do. Their pension contracts are secure due to large public support. Yet the declining state of education and government dysfunction makes teacher and public worker contracts more expendable. The superb documentary, "Waiting for Superman" reveals the heart-breaking abuses of New York City teacher union laws at the expense of adequate education for children.
New Jersey Governor Christie's message of eliminating gold-plated health programs and runaway entitlements for public school teachers hit a resonate chord among a large unemployed and entrepreneurial population. NJ teachers with less than 20 years on the job will pay slightly more in health premiums, increase pension contributions from 2% to 7.5%, and retire at 65, not 60. Not such a bad deal when observed from the outside. If you earn $50K, instead of contributing $1000 a year for life-time support, you will pay $3,750 annually. To taxpayers and entrepreneurs' ears, this sounds reasonable. To union supporters it is "an attack on middle class values." Yet isn't self-reliance one of the most basic of American middle-class values?
This is a country of individuals who constantly reinvent ourselves. In 2011, America is shedding old ideas and re-evaluating who we are and what we believe as a society. The entire question of entitlements hangs in the balance in the coming decade.
Forty three years before collective bargaining was officially sanctioned by the 1935 National Labor Act, union workers had virtually no rights. To strike was illegal. Employers were allowed to break strikes any way they needed and garnered Federal support to that end. Violent employer-employee conflicts erupted frequently in America's industrial age. The Homestead Strike in 1892 was one of them.
Steel workers at Andrew Carnegie's mill in Homestead, PA endured long hours at subsistence level wages. In the early 1890s, America was experiencing a deep and prolonged recession. Steel prices had fallen from $35 to $22 per ton. Carnegie, the richest man in America at that time, and his rather ruthless business partner Henry Frick, did not want to lose market share so they looked to reduce costs. Frick devised a plan to cut wages for the already starving 3800 steel workers and to get rid of the rambunctious 700 member union once and for all.