The Day After Labor Day

Labor Day must be the one holiday the Republican Party leadership hates the most. They are forced to get out amongst the working class and give speeches extolling what they have done for labor. They pull up every statistical trick they learned in the class “How to lie with Statistics”. Just take one example; President Bush cites the 4.7% unemployment rate, while ignoring the fact that millions of Americans have just plain given up looking for work. I know for a fact they aren’t counting one of my close relatives who was laid off last year, collected unemployment for six months, and basically stopped looking for work in his field. He now sells parts he makes on E-Bay. I guess you could say that the Republicans did turn him from a worker to an entrepreneur.

And if you’re lucky enough to have a job, many experience the daily anxiety of getting the dreaded lay off notice or being told you have a job, but you will have to move a thousand miles away where wages are lower. In Harold Meyerson’s excellent article “Just what are we celebrating,” published in the Contra Costa Times on Sunday, he reports that the median hourly wage for Americans declined by 2% since 2003, even though productivity rose handsomely. He cites the New York Times article “Real Wages Fail to Match a Rise in Productivity”, dated August 28 that wages and salaries now make up the lowest share of gross domestic product since 1947. In contrast, corporate profits have risen to their highest share of GDP, since the mid ‘60’s – a gain that has come chiefly at the expense of American workers. A Goldman Sach’s report is also reported on that shows “the most important contributor to higher profit margins over the last five years has been a decline in labor’s share of national income.

If you think all of these wage issues can be attributed to the economic globalization occurring in the world, you would only be partly right. As the article cites, “Since 1973 productivity gains have outpaced median family income by 3 to 1. Clearly, the war of American employers on unions, which began around that time, is also substantially responsible for the decoupling of increased corporate revenue from employee’s paychecks. But finger a corporation for exploiting its workers and you’re trafficking in class warfare.” Meyerson reports that his fellow columnists “have charged that Democratic politicians concerned about the further expansion of Wal-Mart are simply pandering to unions. Wal-Mart offers low prices and jobs to economically depressed communities, they argue. What wrong with that?” Plenty, if you read “Breaking the Chain: The Antitrust Case Against Wal-Mart by Barry C. Lynn, published in the July 2006 Harper’s Magazine. It turns out that because Wal-Mart controls 20% of all retail transactions in the U.S., it all by itself drives down wages and benefits across the economy. Another dirty little secret is how Wal-Mart ruthlessly treats it suppliers. Four of their top ten suppliers were forced to file for bankruptcy because of predatory purchasing practices. The article in Harpers is a real eye opener about Wal-Mart and how it has used its massive size to intimidate companies such as Kraft Foods and Proctor and Gamble. It is a case study on what happens when a company truly becomes a monopoly. In the past, the Department of Justice would have come down hard on such companies as they did on A&P Grocer’s. However times have changed. According to Barry Lynn, when the Republicans came back into power with Reagan they re-wrote the anti-trust provisions to significantly weaken them. It now has to be shown that company practices truly put the consumer at risk. What they left out are all of the safety valves to protect other companies that can be severely harmed by companies like Wal-Mart. What is bad is that while Republicans have been anti-union since William Howard Taft, the Democrats under Clinton became more pro-corporation. It’s no coincidence that Wal-Mart headquartered in Arkansas had little to fear from the Clinton Administration Justice Department. In fact at one time Hillary Clinton was on the Wal-Mart Board of Directors. And of course the Bush Administration is not any time soon going to go after a major corporation like Wal-Mart.

So as we celebrate another Labor Day, we should all ponder how it is workers in this country became Republicans for the most part. Maybe it’s because they felt Democrats now longer represented them either, so they may as well turn to the party who promises to keep their taxes low, and keep gays from marrying. Until that changes, get used to continued declines for the lower 90% of workers who are less and less participating in the American Dream. As Fox News reported on Sunday, there were 25 thousand applicants applying for the 300 low paying job openings at the new Wal-Mart opening in a suburb of Chicago. Fox wondered aloud, if Wal-Mart was so unpopular, where were their so many applicants applying to them for work? They were asking the wrong question. What they should have asked – If the economy under the Bush Administration is so great, why are 25 thousand people applying to Wal-Mart for work?