Why unions and the private sector should work together as partners in job creation
September 26, 2017 by Dave Regan
(Photo Credit: Michael SpotUS/Flickr)
Elevate CA is a conversation about how to increase upward mobility in California -- the overarching theme of the 2017 California Economic Summit in San Diego on Nov. 2-3. Many thoughtful leaders have expressed how to lift the 18 million Californians who live or near poverty into the middle class. Dave Regan, president of the SEIU-United Healthcare Workers West offers his prescription for expanding middle class jobs in California.
Five million Californians earn less than $12.50 per hour whereas 2.5 million of us are members of a union. Ominously, for those who are concerned with economic justice, California union membership is expected to drop by over a half million people following next year’s U.S. Supreme Court ruling in Janus v. Illinois, a case about membership obligations in public sector unions. Given that 53 percent of California’s union members are public sector employees, it is likely the effects of the Janus decision will include reducing the overall level of unionization in California from today’s 16 percent to about 12 percent by the end of 2019. Less than nine percent of private sector workers are currently members of unions and even that level of organization will be harder to maintain once overall union membership is reduce by a quarter.
In other words, the future of unionization in California and our country is grim. The key question is why should anyone outside of organized labor care?
The answer is straightforward and has everything to do with the common good, notions of a healthy and just society and the future of the American experiment in self-government. Simply put, there is no evidence, whatsoever, to suggest that a basic level of economic equality – necessary to the stability and effective functioning of a healthy democracy - can be achieved, let alone sustained, absent strong worker organizations. The American workforce – all 160 million of us – is arguably the single, largest constituency in the country and it is increasingly, and intentionally, losing influence in political, social and industry level decision-making forums across our society. Eroding the collective influence of workers by eliminating unions may enhance the ability of elites to achieve short term goals such as eradicating defined benefit pension plans or maximizing short term profits, but we are all witnessing, in real time, the consequences of historic income inequality, ever rising economic anxiety and insecurity, and the unprecedented volatility and ugliness of a profoundly angry and disaffected populace. This is not only morally wrong and unjust in the extreme, it is also dangerous and entirely predictable.
In short, if our society generally, and California specifically, want to pursue a path that includes broader, and more durable, shared prosperity for the whole of the population then a decision must be taken to share power with the workforce. There is simply no substitute for strong, effective and growing unions and worker organizations in constructing a fair, just and humane society. We have created a society in which the fundamental economic desires of the workforce and majority of the population are continually denied. If issues such as raising the minimum wage, universal pre-kindergarten, universal healthcare, paid-family leave, free public higher education or the elimination of predatory lenders could be put to national referenda we would be living in a very different world.
Our democracy and our economy are viewed, justifiably, with an enormous amount of cynicism and disdain by a majority of the population. The decline of unions has precisely tracked the divergence of productivity gains and real wage gains across all sectors of our economy. Since the late 1970s a new reality has replaced the previous “social contract” in which workers shared proportionately in a common prosperity and were viewed as the legitimate beneficiaries and partners in a growing and dynamic economy; the new reality, a product of diminishing economic and political power for workers, includes stagnant or declining real wages, longer hours to maintain a given standard of living, far more insecurity and constant awareness of the gargantuan wealth produced by the new economy. Our political economy is rigged and everyone knows it.
In this environment, healthy and growing unions and worker organizations are a necessary, but insufficient, ingredient in reforming our economy and democracy. To be sure, unions are deeply flawed organizations that have done little over the last 35 years to render themselves relevant to the growing crisis for working people. The strategic, tactical and cultural mistakes and shortcomings of organized labor are numerous and worthy of separate discussion and inquiry. Yet, unions are “popular” organizations that, by definition, are dedicated to the interests of ordinary workers. There is no substitute for large scale “agency” on the part of the workforce in our political economy. Neither employers nor the Democratic and Republican parties are the rightful representatives of workers; nor are policy experts or philanthropists. Working people alone are the rightful custodians of their own interests and to assert or presume otherwise is misguided, at best, and condescending at worst.
Many things distinguish California’s 21st century economy from the 19th or 20th century versions. Yet, the amount of inequality, deprivation and poverty looks remarkably similar. The internet may allow us a type of access to anything in the world but it is decidedly non-judgmental. It has nothing to offer us regarding the moral and ethical choices associated with the presence or absence of inequality, deprivation and poverty. Those are choices for people. The people of California have chosen to lead the nation in many social, cultural, political and economic ways. On balance, these choices have tended to adopt the “broad-minded” perspective of a state with a relatively short history but a large number of Latin American and Asian-Pacific immigrants.
In the same way that California has historically set the pace on so many fronts, I believe it is now in the interest of the business community, the political community, the entrepreneurial community and the advocacy community writ large and the workforce – the whole state in other words - to come together around the goal of creating the conditions for one million new union and worker organization members to be created. At first blush, this may seem counterintuitive or even naïve. After all, why would business leaders and political leaders, in particular, want to willingly cede some amount of power to workers? The answer is, of course, that unless they do inequality, in the form of a declining standard of living for most people, accelerating homelessness, deeply entrenched poverty and dangerous political instability will not be overcome. California and the United States as a whole do not lack the resources or policy ideas to solve our problems; what we lack are effective allocation and distribution mechanisms in both the economic and political arenas to effectuate known solutions. Effective economic and political decision-making power has become so skewed and concentrated toward elite interests that its continuation now threatens the fundamental stability of our society.
California’s commitment to fundamental change and a reinvigoration of the California Dream must include a formal commitment to the rapid expansion of unions and worker organizations in the state. However, I do not believe this is a task primarily connected to public policy. Rather, I believe leaders across all sectors of our state are positioned to create the informal, but utterly essential, conditions of a new “social contract” for our state.
At a minimum, this requires leaders of all kinds to accept, and be willing to act on, the principle that unions and worker organizations are legitimate entities with intrinsic value, the same as businesses and employers. If this can be done, I believe that there are large-scale opportunities to expand or create unions and worker organizations (including co-ops) in a manner that enhances our ability to generate a rejuvenated, broad, durable and unprecedented prosperity that will continue to attract capital, workers, students, businesses, entrepreneurs and immigrants while, simultaneously strengthening our democracy and demonstrating to the rest of the country that California’s historic bias toward broad-minded, high-road, dynamic prosperity is grounded in actual practice and experience.
In particular, I believe California leaders should look for immediate opportunities to formally “sponsor”, “facilitate” and “promote” specific endeavors between workers, employers and the public to contribute to a new wave of unionized jobs that, at the same time, are also responsive to other social imperatives like the under-representation of women, Latinos, Asians, African-Americans and workers with needed language skills across the state. The demand exists for this solution. What does not exist is the belief on the part of private sector industry that sharing power with workers and their organizations produces superior outcomes for everyone. And what also does not exist is a cohort of unions that are prepared to re-evaluate their assumptions, re-engineer their organizational forms and commit to serving the macro common good rather than the micro, zero-sum conflict tradition of a bygone era.
Specifically, California employers should reconsider their bedrock belief that workers organizing is always problematic and should always be vigorously opposed. Far too many employers, in a broad range of industries, are producing products and services that are deeply flawed in terms of quality, price, utility and social and environmental costs. So long as this is true these firms are vulnerable and the workforce is a potential adversary. Done properly, constructive engagement is not only good business it can be a strategic advantage. Every industry has a trade association to represent their interests to government and the public. No industry, to my knowledge, organizes the voices, networks and communities of their workforce on an ongoing basis to their strategic advantage; this activity is undertaken only in response to crisis or a major scandal. One need look no further than Wells Fargo; it is inconceivable that millions of fraudulent accounts could be created if the Wells Fargo workforce had a legitimate, effective organization to represent the views and values of the majority of employees. Contrary to popular mythology, markets, directors and executive management teams routinely produce outcomes and pursue strategies that most people disagree with. Strong unions and worker organizations don’t eliminate problems like this but they do make them less likely to occur.
As for traditional unions, we are on the verge of irrelevance and need to act like it.
Going forward, unions need to do many things differently including de-emphasizing the primacy of the micro-workplace (unit, department, shift, immediate supervisor) and substitute an emphasis on the macro-workplace (firm, employer, industry, revenue streams, regulatory environment), which has far more to do with the standard-of-living and employment security of members. Unions should seek to be strategic assets (not micro-workplace liabilities) for principled employers. Traditional unions that lack a clear and compelling answer to the question of how they can contribute positively at the strategic level will simply not survive much longer. The future for traditional unions is likely to be large-scale strategic partnerships, focused on the macro-level with willing employer partners who can overcome traditional, reductionist thinking about what a union is and could be if engaged constructively on the strategic dimension. Unfortunately, the state of federal labor law virtually ensures that unions will only take root where they can either demonstrate a scaled ability to be a valuable strategic partner (and are welcomed) or an expensive strategic opponent (and are resisted until resolution). There is no longer any middle ground.
However, as long as there are workers there will be a desire and a demand to create organizations that can advocate specifically for the workforce. Again, due to the anachronistic nature of labor law it may well be the case that different forms of worker organizations will replace the traditional union in the 21st century. Worker owned co-operatives, particularly ones with clear strategies around creating the trained workers needed at an industry, not an employer, level hold promise. These endeavors, particularly in California, offer the possibility of genuine partnership between workers, employers, educational institutions and the general public. The fact that California has large and identifiable shortages of trained workers for good paying jobs creates the “market”; and the fact that a focus on the industry level allows solutions with portable health and retirement benefits, the obligations of which do not reside on an individual employer’s balance sheet, makes the business case a slam dunk.
This is only one possibility. There are more. However, the common thread is that workers and their organizations can offer different and superior solutions to the challenges faced by private industry. If one accepts the notion that any union or worker organization must have a compelling and persuasive answer to the strategic value question; and if one further accepts the notion that unions and worker organizations are legitimate entities with intrinsic value, the same as businesses: then all that is left, at the macro level, for those who want to oppose worker organizations is ideology. Irrational ideology.
California and Californians are better and smarter than that. We can create the conditions, support the engagements of potential partners and create one million more workers, with great jobs, serving the common good of deep, shared durable prosperity.
Hope springs eternal!
Dave Regan is president of SEIU-United Healthcare Workers West