America's Fading Union Presence

New figures from the Bureau of Labor Statistics document that union members, in most of the private sector, have just about disappeared. Be afraid for America's future. Be very afraid. Here's why.

February 5 , 2007

By Sam Pizzigati

Back in the glory days of the American middle class — the 1950s and 1960s — two institutional realities served to keep the gap between the nation’s rich and everybody else relatively modest.

The first of these, the progressive income tax, lowered high incomes. The second — a strong union presence in America’s workplaces — took average incomes higher.

These two realities no longer define the American scene. America’s very richest, under Dwight D. Eisenhower, paid half their incomes in federal taxes, even after exploiting loopholes. Their counterparts today, after exploiting loopholes, pay less than 20 percent of their income dollars in tax.

Their counterparts today also don’t have to stare across bargaining tables at unions. A half-century ago, about 35 percent of workers in the private sector belonged to unions. Last year, the U.S. Bureau of Labor Statistics reported late last month, only 7.4 percent of private sector workers held union cards.

In the 1950s, union contracts set standards that helped all workers, even workers who didn’t belong to unions. Retail giant Sears Roebuck, for instance, operated nonunion but offered union-level wages and benefits. For Sears, that approach made business sense. In a United States where unions stood tall, companies that conspicuously short-changed workers simply could not prosper.

In today’s “union-free” America, by contrast, major corporations — Wal-Mart, most notably — short-change workers to prosper.

The new Congress could change this dynamic. The Employee Free Choice Act, legislation advanced by Rep. George Miller (D-Calif.), would, as labor lawyer Thomas Geoghegan notes, “let employees get unions just by signing cards — without having to run what can be a four- to five-year gauntlet of lawsuits, firings, intimidation, and all the bells and whistles of union-busting campaigns.”

Geoghegan, one of America's top commentators on the labor movement, last week called the Miller bill America’s “last chance to rein in the plutocracy and curb inequality.” But the bill faces tough sledding in Congress — and a sure veto from President Bush.

Still, Geoghegan remains hopeful. He thinks Corporate America just might be ready to make a deal, because top execs now have something they “really, really” want: repeal of the provisions in the 2002 Sarbanes-Oxley corporate reform act that subject CEOs to jail time if they sign corporate financial statements later found to be fraudulent.

“CEOs and CFOs have grown up in a culture where people don’t so much cook the books as lightly sauté them every year,” observes Geoghegan. “They want to go back and do what they used to do before. And they want to be able to do it without doing federal time.”

Would corporations, in exchange for Sarbanes-Oxley “reform,” accept legislation that helps workers unionize? Today’s CEOs, quips Geoghegan, may have seen enough executive perp walks to realize “there are worse things in life than dealing with a union.”

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Sam Pizzigati edits Too Much, an online weekly on excess and inequality.