The Union Way Up
January 26, 2009 7:27 pm

Robert B. Reich, The Los Angeles Times

Why is this recession so deep, and what can be done to reverse it?

Hint: Go back about 50 years, when America's middle class was expanding and the economy was soaring. Paychecks were big enough to allow us to buy all the goods and services we produced. It was a virtuous circle. Good pay meant more purchases, and more purchases meant more jobs.

At the center of this virtuous circle were unions. In 1955, more than a third of working Americans belonged to one. Unions gave them the bargaining leverage they needed to get the paychecks that kept the economy going. So many Americans were unionized that wage agreements spilled over to nonunionized workplaces as well. Employers knew they had to match union wages to compete for workers and to recruit the best ones.

Fast forward to a new century. Now, fewer than 8% of private-sector workers are unionized. Corporate opponents argue that Americans no longer want unions. But public opinion surveys, such as a comprehensive poll that Peter D. Hart Research Associates conducted in 2006, suggest that a majority of workers would like to have a union to bargain for better wages, benefits and working conditions. So there must be some other reason for this dramatic decline.

But put that question aside for a moment. One point is clear: Smaller numbers of unionized workers mean less bargaining power, and less bargaining power results in lower wages.

It's no wonder middle-class incomes were dropping even before the recession. As our economy grew between 2001 and the start of 2007, most Americans didn't share in the prosperity. By the time the recession began last year, according to an Economic Policy Institute study, the median income of households headed by those under age 65 was below what it was in 2000.

Typical families kept buying only by going into debt. This was possible as long as the housing bubble expanded. Home-equity loans and refinancing made up for declining paychecks. But that's over. American families no longer have the purchasing power to keep the economy going........

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Tell the NYT: Highly Paid People Wrecked the Banks and the Economy
January 26, 2009 9:51 pm

Dean Baker

The NYT is worried (in a news analysis) that if the government took over bankrupt banks that it wouldn't be able to attract good people at government salaries: "and how would the government attract the best talent if it demanded that they take minimal pay."

I guess they didn't notice that the "best talent" is the reason that the banks are bankrupt and the economy is crumbling. At this point, the economy can't afford the best talent, even if they would work for free.

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Two Santa Clauses or How The Republican Party Has Conned America for Thirty Years
January 27, 2009 9:14 pm

by Thom Hartmann

This weekend, House Republican leader John Boehner played out the role of Jude Wanniski on NBC's "Meet The Press."

Odds are you've never heard of Jude, but without him Reagan never would have become a "successful" president, Republicans never would have taken control of the House or Senate, Bill Clinton never would have been impeached, and neither George Bush would have been president.

When Barry Goldwater went down to ignominious defeat in 1964, most Republicans felt doomed (among them the then-28-year-old Wanniski). Goldwater himself, although uncomfortable with the rising religious right within his own party and the calls for more intrusion in people's bedrooms, was a diehard fan of Herbert Hoover's economic worldview.

In Hoover's world (and virtually all the Republicans since reconstruction with the exception of Teddy Roosevelt), market fundamentalism was a virtual religion. Economists from Ludwig von Mises to Friedrich Hayek to Milton Friedman had preached that government could only make a mess of things economic, and the world of finance should be left to the Big Boys – the Masters of the Universe, as they sometimes called themselves – who ruled Wall Street and international finance.

Hoover enthusiastically followed the advice of his Treasury Secretary, multimillionaire Andrew Mellon, who said in 1931: "Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate. Purge the rottenness out of the system. High costs of living and high living will come down... enterprising people will pick up the wrecks from less competent people."

Thus, the Republican mantra was: "Lower taxes, reduce the size of government, and balance the budget."

The only problem with this ideology from the Hooverite perspective was that the Democrats always seemed like the bestowers of gifts, while the Republicans were seen by the American people as the stingy Scrooges, bent on making the lives of working people harder all the while making richer the very richest. This, Republican strategists since 1930 knew, was no way to win elections........

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Bailout Recipients Hosted Call To Defeat Key Labor Bill
January 28, 2009 10:09 am

Sam Stein, Huffpost

Three days after receiving $25 billion in federal bailout funds, Bank of America Corp. hosted a conference call with conservative activists and business officials to organize opposition to the U.S. labor community's top legislative priority.

Participants on the October 17 call -- including at least one representative from another bailout recipient, AIG -- were urged to persuade their clients to send "large contributions" to groups working against the Employee Free Choice Act (EFCA), as well as to vulnerable Senate Republicans, who could help block passage of the bill.......

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Our Other National Shamelessness: Needless Job Layoffs
January 29, 2009 10:37 pm

Lee Stranahan

We've seen over 100,000 job losses this week alone. In some cases, those companies had no choice. In other cases, they are examples of what Barry Diller called "throwing people onto the unemployment heap for frankly no good reason."........

.......Some of these executives and their defenders may see their actions as a sort of noble selfishness ripped from the pages of a bloated Ayn Rand paperback. The self delusion has proven too dangerous to our country to let stand. The American businessman on display lately isn't John Galt from Atlas Shrugged; he's Gollum from The Lord Of The Rings - so focused on his precious shiny baubles, $87,000 office makeovers and quarterly dividends that he's lost his sense, soul and mind..........

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The Republicans' Fatal Misreading of FDR -- and How It Would Worsen The Depression
January 31, 2009 7:31 am

Johann Hari, Columnist, London Independent

.....It's almost forgotten now, but FDR ran for election promising a balanced budget and big spending cuts. By the time he assumed the Presidency, however, public protests against the economic collapse were so huge that he was forced to change course and launch his public spending push. The result? Unemployment began to slide down from its 25 per cent peak.

But then, in 1936, FDR wobbled. He listened to the people making the fiscally conservative case and slashed spending. Unemployment rose again - producing the spike in unemployment that people like Osborne now perversely cite as evidence that the New Deal didn't work. But the reality stands. When FDR spent, unemployment fell. When FDR cut back, unemployment rose......

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Watch Senator Claire McCaskill's speech about the "idiots" on Wall Street, which she delivered on the Senate floor yesterday.
January 31, 2009 5:32 pm

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New Ad Refutes the Myths About Employee Free Choice
February 1, 2009 9:39 pm

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SEIU Calls on Bank of America to Oust CEO Over Executive Bonuses
February 1, 2009 9:48 pm

The SEIU wants Bank of America to kick CEO Ken Lewis to the curb because the company approved $4 billion in bonuses for Merrill Lynch executives after accepting $25 billion in bailout funds last October. Is there any wonder why Bank of America is bad for America? While the nation's largest bank was handing out hefty bonus checks, they were drawing up plans to layoff 35,000 of their 247,000 employees; investing billions in overseas banks and Washington lobbyists; flying executives around on corporate jets; foreclosing on homes; cutting credit to consumers; and refusing to pay employee health care. To top it off, they had the nerve to request $20 billion more from our Treasury.

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Who Will Be the First Female US President?
February 1, 2009 10:06 pm

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The Big Con Back to the Seventies (2)
February 1, 2009 10:32 pm

by Rick Perlstein

Anyone who follows my work closely knows that one of my obsessions is conservative zombie lies about Vietnam: stories made up, often at the highest levels, by right-wing moutebanks to spread the propaganda that VIetnam was a noble and successful venture until liberals in Congress came along and screwed it up. The granddaddy of the lies is the one about how South Vietnam could have survived as a free and independent country after the American withdrawal in 1973, but for a vote by Congressional liberals denying aid to Saigon in 1974. This decision to deny military aid to Vietnam has been blown up in the wingnut imagination as a world-historic stab in the back, an event on par in historic importance with D-Day, Agincourt, the signing of the Declaration of Independence, possibly all rolled into one.

Actually, as the facts demonstrate, that decision was bi-partisan, uncontroversial, overwhelmingly popular, led by Barry Goldwater and tacitly endorsed by Nixon and Kissinger, who understood that South Vietnam could never survive as an free and independent country no matter how much money we shoveled them.

So it was rather with delight that I stumbled across on Proquest Historical Newspapers the New York Times's "News Summary and Index" for August 7, 1974, which advertising on the paper's inside pages a welter of such earth-shattering political news as "Ford appears solemn and preoccupied" (page 16), "Weicker presses for curbs on tax data" (page 18), and "Tristate G.O.P. officials fear election losses," the following teaser for what the stab-in-the-back right considers The Most Important Event In The History Of American Wars:

"House cuts gas and Vietnam funds" (page 7)

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