Week In Review
A Weekly Column by Bill Onasch
June 6, 2011
Note: Certain strange abbreviations and awkward formulations are necessary to comply with e-mail riles of some ISPs.
Recovery and Ours
The embargo of the Bureau of Labor Statistics monthly jobs report is more secure than most diplomatic and military communications. Those predicting this key economic indicator risk embarrassment. The Administration was optimistically talking about job growth in the range of 120,000 while most on the Street thought perhaps as few as 80,000 new hires would be reported. All were shocked Friday morning to hear the number 54,000.
The official unemployment rate crept back up to 9.1 percent. If you put together those counted as unemployed; marginally attached to the workforce; and involuntary working less than the standard work week; there are still more than 25 mln who want full-time jobs and can’t find them–a number that has remained more or less constant for over a year. The average private sector workweek remained at 34.4 hours in May. Average private sector wages increased by a scant 0.3 percent to 19.43 an hour.
Now it takes at least an average of 150,000 new jobs a month just to accommodate population growth. If you added an additional mln jobs on top of that every month for a steady year you still wouldn’t put all the 14 mln officially unemployed back to work–not to mention the mlns more “discouraged” and “involuntary short hours.” Worse yet, previous reports of job growth in March and April were revised downward by 30,000. And, we haven’t forgotten that the 62,000 hired with much fanfare by McDonalds are included in these May figures. So 54,000 is bleak indeed.
Diane Stafford–one of the few journalists so far surviving job cuts at the emaciated Kansas City Star–examined some responses to the news,
“Among the suggestions Friday from politicians, economists, business leaders and regular folks: cut taxes; send federal stimulus aid to the states; freeze regulations on small business; cut government spending; pass international trade agreements to expand export markets; create a federal jobs program like the ones in the 1930s....
“In a visit Friday to a Chrysler plant in Toledo, Ohio, President Barack Obama emphasized the turnaround in the U.S. auto industry, saying the government recouped more money than expected from its investment two years ago in Chrysler and General Motors. The president didn’t directly address the lackluster jobs report or offer a specific job-generating plan.”
While the President may have recouped more than he expected from the now again profitable automakers , tax-payers are still out 14 bln for their bail-out. A White House spokesman said the jobs report signified a “bump in the road of recovery.”
Except for a New Deal-style make-work program, all the suggestions quoted have been tried throughout the Great Recession and Jobless Recovery. Some are clearly counterproductive. Cuts in government spending have directly led to substantial unemployment in the once growing public sector. 446,000 local government jobs have been lost since September, 2008.
The Chamber of Commerce whined that the White House is responsible for “failing to alleviate the uncertainty businesses are feeling” about taxes and regulations. The President has in fact not only ordered numerous boss-requested eliminations or postponements of EPA and OSHA rules; he has also appointed the CEO of General Electric to head the government’s task force on “competitiveness,” and has assigned Vice-President Biden to negotiate enormous fiscal concessions to the Republican House. And, let’s don’t forget these timid corporations championed by the Chamber continue to sit on a mountain of cash amounting to two trln dollars–much of it left over from stimulus money handed out and never used to create jobs.
An emergency public works program providing some relief for the blue collar long-term jobless has merit. Similar programs for unemployed professional and white collar workers would be more challenging but possible. But, just like the much over-rated WPA during the Great Depression, such projects are meant to be temporary until the economy recovers and are not sustainable over the long haul. In the case of the Depression that recovery came in the form of a war that claimed the lives of seventy mln.
But we keep coming back to the fact that we are already well in to a recovery. The GDP has grown–as have corporate profits and CEO compensation. The employers have succeeded in imposing unprecedented increases in productivity of the existing workforce. Cutting their taxes or eliminating regulations may make them richer but does nothing to motivate private sector hiring.
Not all is rosy for the ruling class, however. In a post-Peak Oil world, fuel prices will, with intermediate up and down spurts, continue overall to soar. A combination of climate change, and market diversion of agriculture away from food to fuel and fiber, will mean more and more of consumer spending will be required just for people to eat. Even global capital’s recovery can’t survive those threats for long.
Like the others, I have only a long standing suggestion to repeat. I see no acceptable future for working people other than to use our potential economic and political power to restructure our economy, to tackle the increasingly combined jobs and climate crises. The tasks required to rebuild for a sustainable biosphere will produce a sustainable full employment economy as well. All other roads lead to dead-end or disaster.
There was good reason for President Obama to appoint GE’s CEO Jeffrey R. Immelt to chair the President’s Council on Jobs and Competitiveness. The man is a credit to the class they both serve. Few companies have been so adept at using both increased productivity and offshoring to eliminate good union jobs in the USA. When GE’s unions won a 102-day national strike in 1969-70 they represented 150,000 workers. Current union bargaining at GE is for about a tenth of that number.
GE’s profits have not shrunk with their unionized American workforce. Quite the contrary, they are the most profitable manufacturing company headquartered in the USA. Still, they are demanding major give-backs from their workers up and down the line on health care, pensions, wages, and work rules. The GE Workers United website summed up the present state of negotiations, “Rocky week. It’s getting testy. And it’s still early.”
If GE thought workers would be cowed and demoralized by their demands they got another think coming Saturday when workers rallied in the UE stronghold of Eire, Pennsylvania–home of GE’s locomotive works. The Erie Times-News reported,
“So many union workers showed up for Saturday's labor rally at Gannon University's Hammermill Center that they overwhelmed the school's security system. Lines of people, many dressed in brightly colored union T-shirts, snaked up and down Peach Street just before the rally began at noon. ...UE Local 506 hosted the rally as a show of solidarity. It is one of 10 unions, representing about 15,000 workers, that are negotiating a new national labor contract in New York City with the General Electric Co....A near-capacity crowd of about 3,500 waved signs, blew horns and cheered loudly during the two-hour rally. ‘Many of you have been turning it loose in your shops,’ UE Local 506 President Roger Zaczyk said, referring to the union's motto. ‘I'm telling you that New York City is hearing you loud and clear.’”
A media advisory from National Nurses United opens,
“Hundreds of registered nurses from 31 states, joined by labor and community allies, will gather outside the White House, picket the U.S. Chamber of Commerce, and rally near Congress Tuesday, June 7 to call for a new, ‘Main Street Contract for the American People.’
“The gathering, sponsored by National Nurses United, the nation’s largest union and professional association of nurses, will propose a program for rebuilding American communities with jobs, healthcare, education, and other urgent needs, funded through a fair tax policy targeted at those on Wall Street who created the economic crisis. Nurses will emphasize that theme with a spirited protest at the U.S. Chamber of Commerce headquarters.”
Among the speakers joining the nurses will be AFL-CIO president Rich Trumka and Senator Bernie Sanders.
Also new from the NNU is a Nurses Open Letter to Wisconsinites – Carry on! from co-president Jean Ross.
¶ Now on the front line of the fight against austerity, the 50,000-member Canadian Union of Postal Workers launched a series of rolling one-day localized strikes against Canada Post. They began in Winnipeg, shifted to Hamilton, and today are shutting down Montreal.
¶ The next KC Labor Forum is this coming Sunday, June 12, 2-4PM, at the North Kansas City Community Center. The topic is--Ozarks: Front Line Of Climate Change? Can We Do Anything About It? I’ll kick off a discussion about how extreme weather events are a sign that climate change has begun and what’s needed to stop it. You can view/print a PDF version of the Forum leaflet here or give me a call at 816-753-1672 for more details.
¶ I was never a jock in high school but I was captain of the Ruskin debate team that made the state finals three years running. So I was quite disappointed to see this headline in this morning’s Kansas City Star, “Budget cuts by KC School District silence debate teams.”
¶ An Atlantic City news hub reported, “Members of [UNITE HERE] Local 54 handed out leaflets Wednesday morning outside Resorts, offering advice on how workers can apply for food stamps. ...Resorts' new owners have cut pay so drastically that employees may be eligible for other types of public assistance as well.”
Much more of interest appeared in our Daily Labor News Digest, updated by 9AM Central, Monday-Friday.
That’s all for this week.
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