Week In Review

A Weekly Column by Bill Onasch
January 10, 2011

Hype the Predictions–Bury the Results
All last week we were hearing how the U.S. economy is surging as experts predicted the monthly jobs report from the BLS would show a growth of at least 150,000 new hires. Even that would be pretty modest considering on average 125,000 new job seekers enter the market every month. But it turns out new hiring fell far short of that–only 103,000.

Most of that was in the hospitality, leisure and healthcare industries where new employees typically wind up in part-time or temporary low wage jobs. Only 10,000 new manufacturing jobs opened up while construction continued to fall. Work hours remained static at a private sector weekly average of 34.3.

This was the month for the BLS to make their annual year-end “statistical adjustment.” I am not a trained statistician and must accept the result that somehow unemployed workers fell by 556,000 to 14.5 million and the official rate plummeted to 9.4 percent. But any way you look at it, when you add 8.9 million “involuntary part-time” workers, and 2.6 million “marginally attached to the workforce,” there are still 26 million workers in this country who want a full-time job and can’t find one.

Hiring comes not only from increased demand for goods and services but also attrition. Just as there are 125,000 newbies entering the market each month some are leaving jobs for a variety of reasons–the best being retirement.

There are over seventy million Americans in the loosely defined demographic group Sylvia Porter dubbed “Baby Boomers.” The oldest of them are already eligible for retirement and a steady stream will follow over the next 15 years. Many of them are in decent paying jobs. Will this bring relief to the jobless?

The Boomers are not rushing in to their Golden Years. This is not because they are, as a group, greedy. Many took hits on their savings and IRAs during the financial crisis. Past Social Security “reforms” in the 1980s lifted the age for receiving “full” benefit payments to around age 67. Obama’s bipartisan Deficit Commission is having success in selling the lie that Social Security is doomed. The younger Boomers–I’m married to one–are resigning themselves to working until they drop.

Even when well paid private sector union workers decide to retire and make room for the next gal or guy, it may not be a plus for the economy. When a UAW member at one of the Big Three automakers hangs it up their replacement gets only half of their wage and few of the benefits. Two- and multi-tier wages and pensions have become widespread. Recent deals at Harley-Davidson and Kohler have even incorporated casual labor in to union workplaces.

While the President continued to exude optimism about the stealth recovery, he made some significant moves in the West Wing.

Bill Daley was brought in as his new chief-of-staff. Daley is, of course, son of the legendary Mayor of Chicago, forever remembered for his hosting of the 1968 Democrat convention that figured prominently in the award winning film, Born On the Fourth of July. His brother is the current Chicago Mayor, stepping aside to be replaced (they hope) by Obama’s first c-o-s, Rahm Emmanuel. Daley served as Bill Clinton’s Secretary of Commerce and played a key role in driving through NAFTA. He was Al Gore’s campaign manager in the 2000 election. Since then he served a stint as president of SBC, and more recently as a top executive with JPMorgan Chase. He also sits on the boards of Boeing, Merck & Co., Boston Properties, Inc., Loyola University Chicago, and the Council on Foreign Relations.

In another musical chairs move, Clinton-era retread Gene Sperling replaced Larry Summers as head of the National Economic Council–a post he held from 1996 to 2000. Sperling was the lead negotiator that brought China in to the WTO and secured Beijing’s favored nation trade status. During the Bush days he was advising and speaking. According to Bloomberg News, Sperling earned 887,727 dollars from Goldman Sachs in 2008 and 158,000 for speeches to financial companies. In the current administration he has assisted Treasury Secretary Geithner.

This reinforcement of connections with the very top rungs of the ruling class was approvingly noted by the Wall Street Journal in an article headlined, Obama Moves to Make Peace With Business,

“The president has been reaching out directly to U.S. companies, meeting with 20 chief executives last month to ask for ideas on policies that would inspire them to invest and hire. And on Feb. 7, Mr. Obama will cross Lafayette Park from the White House to the headquarters of the U.S. Chamber of Commerce, his longtime political nemesis, to discuss working together on job creation.

“‘The administration took some positive steps recently, striking a bipartisan agreement to extend current tax rates, moving the ball forward on the U.S.-Korea free trade agreement, and reaching out to the business community,’ says Thomas J. Donohue, the chamber's president. ‘We're not going to agree on everything, but there's a lot we can get done for the American people.’”

This attempt to revive the close collaboration between White House and Big Business that brought Globalization to North America under Clinton is a far greater threat to the working class than the Tea Party shenanigans being allowed to act out in the new GOP-led House. While Boehner directs the clowns Obama’s team deals with the ringmasters.

And Outside the Beltway...
We’ve heard a lot about the reactionary attacks on working people by new Governors swept in to power by the “shellacking”of Democrats in the Midterm elections. In addition to cuts in Medicaid and schools, and plans to introduce so-called “Right-to-Work” laws, they are also targeting their own employees. Their attacks on public sector unions are framed as a revolt by tax-payers against overpaid and unproductive workers hiding behind shields of seniority, tenure, and “antiquated” civil service rules.

Of course, we need to mobilize working class solidarity in support of those who have a bulls-eye imbedded on their backs by the new right-wing GOP administrations. But not all the Dems got shellacked. How are our “friends” helping?

Democrat Andrew M Cuomo, another son of a long time Establishment politician, also accepted the nomination of the Working Families Party in his election as Governor of New York. The New York Times headlined this description of his first State of the State address Speech Suggests Pro-Business Approach by Cuomo. Following the lead of the White House, Cuomo is freezing wages of state workers and wants to reduce the number of state agencies by twenty percent. He is sympathetic to the call by New York City’s billionaire Republican Mayor, Michael R Bloomberg to gut civil service rules covering 300,000 highly unionized city employees.

Unlike the false scare around Social Security, the outlook for public worker pensions is truly and painfully bleak. In some states politicians stole pension contributions to pay for other public services without raising taxes. Now those services are collapsing anyway and the thieves demand the victims of state theft go without or restore their own pension funds. Illinois was perhaps the most outrageous example.

The pension issue was top priority for the Chicago Federation of Labor in their interviews of candidates for Mayor of Chicago conducted a few weeks ago. Three of the candidates--Miguel del Valle, Carol Moseley Braun and Gery Chico–favor shafting the next generation of new hires with a sub-tier pension while preserving promised benefits to present workers. But even that betrayal was insufficient for Rahm Emmanuel who calls for slashing benefits for all. Which friend will the CFL choose?

In California, yet another son of a political powerhouse, Jerry Brown prevailed over billionaire Republican Meg Whitman for Governor only because of a big mobilization of labor voters. He too is promising “tough love” for his labor friends.

Public sector unions represent the majority of unionized workers in the USA. Now that the main bastions of private sector unions appear to be largely housebroken–at least for the moment--the public will bear the main brunt of class war in the coming period. It’s not just their problem–it’s a challenge to all workers. We’ll be following these developments every week in this column as well as posting news stories on our Daily Labor News Digest.

Another Taunton Alert
Our old friend UE legislative director Chris Townsend forwarded us a message from UE Local 204 in Taunton, MA about their fight to save a plant and jobs abandoned by Esterline–a story we have written about several times. The new message says in part;

“Esterline continues to schedule the previously postponed auction of Haskon presses and equipment in Taunton, MA on January 19. Presses and equipment that have provided thousands of Taunton area families with decent union manufacturing jobs for decades.

“UE Local 204 members continue to fight for justice and jobs. We continue to plan to ‘STOP THE AUCTION’ at Haskon on January 19 and ask that supporters come to Taunton to help us. If the action is, again, postponed for any reason we will let everyone know through email and the UE Local 204 ‘Keep Haskon Jobs in Taunton!’ Facebook page here:
http://www.facebook.com/group.php?gid=111653108846718
or if you have a Facebook page type in: Keep Haskon Jobs in Taunton!”

In Brief...
¶ An AP headline read, “Health Cost Rise Slows.” The more realistic Wall Street Journal bannered the same statistics as, “Health Spending Eats Up Record Chunk of GDP.” That chunk was 17.6 percent of the U.S. economy in 2009.
¶ That big chunk doesn’t go very far in Arizona. The New York Times reported from Phoenix, “A second person denied transplant coverage by Arizona under a state budget cut has died, with this death ‘most likely’ resulting from the coverage reduction, a hospital spokeswoman said Wednesday.”
Made in Dagenham, a film based on the real 1968 story of women Ford workers in Britain battling for equality on the job, has finally made it to Kansas City and most likely is playing near you. While I haven’t yet seen it I definitely plan to make room in my schedule this week. Steve Early writing in the Labor Notes blog compares it favorably to such classics as Bread and Roses and Norma Rae.

That’s all for this week

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