Unions are struggling as the American Midwest bears the brunt of globalisation.
By Richard C. Longworth
There is historical resonance in the fact that the Battle of the Statehouses, the struggle over the attempt by newly-elected Republicans to kill off public service unions, broke out in the American Midwest.
Once upon a time, before the Rust Belt era and globalisation destroyed most of its factory jobs, the Midwest was the industrial core of America. The region embraces the nation's heartland, parts of 10 states stretching from western New York and Pennsylvania to eastern Iowa and Minnesota, wrapped around the Great Lakes and the Mississippi River watershed. Because the nation's mightiest industrial corporations rose here, so did its biggest and strongest unions. The great labour battles, from River Rouge to Republic Steel, took place in the Midwest, and gave union members a ladder to climb.
The result was a proud moment in America's economic history—the creation of an industrial middle class. These workers toiled on blast furnaces and assembly lines and carried their lunch in lunch boxes, but they owned their own homes and a car or two, had a cottage by the lake and took holidays. In short, they were middle class.
That is history. Most of those corporations are gone, decamped to the American South and then to Mexico and China, all largely non-union territories. The unions couldn't follow, so they are shrunken: only 6.9 per cent of American workers now belong to unions, only 10 per cent of those in manufacturing.
Not surprisingly, the industrial middle class is gone, too. The Midwest's old factory towns are wastelands where these workers once lived, pocked with vacant lots, rusting mills, empty stores. The Midwestern wage structure today is an hourglass, with quite a lot of well-educated and skilled employees at the top, many more destitute workers at the bottom, and not much in between. Those middle-class workers may still be there, but their jobs aren't.
All Midwesterners know this history. This includes the bulk of workers who are still unionised. These are mostly public service workers—teachers, firemen, policemen, state and local government workers.
If private-sector union membership is only 6.9 per cent of all workers, public-sector union membership is 36 per cent. Among local government, the figure rises to 42 per cent. For the first time, there are more union members employed by government now than by private business, even though the private sector has six times as many jobs.
Not surprisingly, public-sector wages are considerably higher than private-sector wages—an average of $917 per week, exactly $200 more than the $717 taken home by private-sector workers, not counting benefits such as pensions and healthcare.
This is the background to the battles that raged in state capitals in Wisconsin, Ohio and Indiana. In each state, governors or legislative leaders tried to wipe out or limit the power of public sector unions. In each state, the government workers looked at what happened to private-sector workers when their unions collapsed, and decided to fight.
But why now? The new labour battles result from the confluence of two events—generally huge and intractable state deficits and the sudden rise to power of the most conservative members of the Republican Party, including the far-right Tea Party faction.
Of the two events, the rise of the Tea Party is the most important. None of the three states in the firing line—Wisconsin, Indiana or Ohio—has an especially big deficit, at least compared to other states such as California or Illinois, where Democrats rule and where no union battles have broken out: Illinois, in fact, became a refuge for Democratic legislators from Wisconsin and Indiana, who fled their states to deny Republicans the legislative quorum they needed to defeat the unions.
The new governors of Wisconsin and Ohio, Scott Walker and John Kasich, are longtime foes of unions. They are funded by anti-union businessmen, such as the Koch brothers. The suspicion is that both Walker and Kasich, like the Republican legislative leaders of Indiana, are using their state deficits as an excuse to cripple unions. (The Indiana governor, Mitch Daniels, is also a Republican and a possible 2012 Republican presidential candidate who has publicly denounced his legislative allies' attacks on the unions.)
The mid-term elections of last November brought these new Republicans to power, as they did the Tea Party members of Congress determined to cut the federal government's deficit. Once again, it's easy to suspect that these deficit hawks are more devoted to crippling the federal government and returning power to states than they are to trimming the deficit itself.
Ford City, Pennsylvania, late 19th century
The Tea Partiers won, in the Midwest and elsewhere, on the wave of public angst over the recession, genuine worries about the deficit and the waning support on the left for President Obama. All the Midwestern states are genuine swing states: none is reliably Democratic or Republican. All went for Obama in 2008. Most, including Wisconsin, Ohio and Indiana, went Republican last year.
There's more to this than union rights. The Midwest, having lost its industrial economy, desperately needs to invent a new, 21st-century, post-industrial economy. This means investment especially in education and infrastructure. Both Walker and Kasich propose cuts in exactly these areas.
For a region heading into the new knowledge economy, declaring war on one's teachers and their unions looks a lot like economic suicide.
The American writer H.L. Mencken once commented that "democracy is the theory that the common people know what they want and deserve to get it good and hard". The Tea Party won last year fair and square and is moving fast to turn its wishes into law.
Too fast? The Democratic hope is that the new Republican leaders over-estimated their power and under-estimated the continuing support for unions, even in this post-industrial era. Polls show that Americans, most of them non-union members themselves, still support the union rights of government workers by a solid two-to-one margin.
So the Tea Party may be sowing the seeds of its own defeat, in the nation and in the Midwest. But that defeat, if it comes, is still two years away. By then, public sector unions may have joined the industrial unions on the scrapheaps of the Midwestern economy.