September 21, 1998
by Tim Costello & Jeremy Brecher
Organized labor, awakening from its quarter-century “era of stagnation,” finds itself, Rip Van Winkle-like, in a world transformed. While labor slept, corporations restructured, markets globalized, the postwar “class compromise” broke down, labor-endorsed economic policies failed and the working class itself was reconfigured. Labor will have a future if and only if it can respond effectively to these changes.
So far, discussion of labor’s current revival has focused less on these new challenges than on how adequately organized labor is addressing its longstanding problems, many of which go back to the days of John L. Lewis or even Samuel Gompers. Some, like racism, sexism, corruption, separation from the community, isolation from immigrants and inattention to organizing, are being addressed, to a greater or lesser extent, today. Others, like the power of bureaucratic political machines within unions and labor’s acquiescence in “management’s right to manage,” continue to fester unaddressed. But now that Rip has awakened from his slumbers, it is none too soon to start asking how he will have to change in order to thrive in a radically altered world.
That question needs to be discussed openly by people at every level in unions, allies outside of unions and intellectuals interested in labor. Ultimately the answers are most likely to emerge from hundreds of experiments conducted by the complex and often conflicting institutions, traditions and activists that make up the labor movement–and by the millions of unionized and not-yet-unionized workers who face these new realities in their daily lives. But such experimentation should be guided by an ongoing dialogue. The purpose of this article is to engage that dialogue.
Restructuring Labor
At least since the “merger movement” at the start of the twentieth century, US corporations like General Motors, DuPont and Anaconda have aimed to integrate the process of production and distribution from raw materials to the consumer into one centralized enterprise. Until recently, a handful of such integrated enterprises dominated each major American industry.
The modern US labor movement was shaped in the era of the centralized national industrial corporation. Union power was based on the ability to organize the major plants of the major companies and then force them to negotiate. After bitter straggles, corporations came to accept industrial unions — as long as those unions forced all companies competing in an industry to adopt equivalent labor costs. So unions developed a highly centralized structure, in which power lay predominantly in national union offices suited to negotiating and enforcing corporate- and industry-wide contracts. The public sector largely mimicked the structure of the private sector, and so did public-sector unions.
Today, organized labor confronts a transformed corporate structure. Faced with increasing global competition, corporations are reorganizing into what Bennett Harrison calls “networked production.” They pursue “lean production” by downsizing in-house operations to “core competencies” and farming out work to “rings” of outside suppliers. Corporations construct “strategic alliances among one another, both within and, especially, across national borders.” Harrison describes this “emerging paradigm” as concentration of control combined with decentralization of production. “Lean production, downsizing, outsourcing, and the growing importance of spatially extensive production networks governed by powerful core firms and their strategic allies, here and abroad, are all part of businesses’ search for ‘flexibility,’ in order to better cope with heightened global competition.” A perfect example is GM’s announcement in the wake of this summer’s strikes that it would spin off its Delphi Parts unit as a separate company and replace existing factories with new ones designed to make far more use of subcontractors. In the public sector, privatization is leading in a similar direction, with many government functions parceled out among a ring of private subcontractors, which are generally nonunion and pay lower wages.
Yet as corporations have diversified, downsized, subcontracted and replaced permanent workers with contingent ones—putting workers in increasing competition with one another–labor’s response has been almost entirely ad hoc. Unions have amalgamated shrinking locals and signed up any new members they could find, regardless of whether those workers had any relationship to each other. The UAW, for example, represents workers as diverse as farm implement assemblers, writers and university clerical employees. While organizing the unorganized is a laudable goal, random recruitment has limited strategic value, since it does little to take workers out of competition. So far, national union mergers have often aggravated the jumble. Even union “locals” may represent dozens of different workplaces in several different industries. A large Teamsters local in Boston includes dozens of workplaces, representing not only track drivers but factory workers and even police officers.
To deal effectively with decentralized corporations, any union structure will have to set common standards for wages, conditions and social protections for workers who would otherwise be in competition. Workers scattered through decentralized workplaces need to be able to fight for those standards on their own initiative; otherwise, contracts, even when won, will be unenforceable. And they will have to be able to cooperate with other workers in the same company, occupation and industry throughout the world.
What new structures might allow workers to empower themselves and pursue their interests in the world of the “virtual corporation”? At first sight, the solution might seem obvious: Get all workers in a company, occupation or industry into the same union — for example, all healthcare workers. But today’s companies generally operate in many industries and employ many different kinds of workers. Unions organized industry by industry would divide workers in multi-industry companies. Unions organized company by company, conversely, would divide those who work in the same industry among different unions. Many occupational categories even cut across the line between public and private sectors. If all hospital workers belonged to the same union, public-sector hospital workers would be separated from other government employees. Conversely, if all government employees belonged to the same union, hospital workers in the public and private sectors would be divided. Of course, all workers could be organized into “one big union,” but the same paradoxes would reassert themselves within such an organization –not to mention the nightmares of bureaucratic centralization it would entail.
These seeming paradoxes require a rethinking of how the individual union functions as the basic unit of labor organization. Workers at any one work site need to be able to coordinate their actions not only with one another but with others in the same company, industry and occupation elsewhere. This might require a system of councils representing workers from different unions in the same industry or company or occupation. Such a structure could serve as a vehicle for workers to cooperate along the multiple and overlapping lines that already connect them, willy-hilly, because of the way their work and society have evolved. (This approach is explored further in our article, “Labor and the Challenge of the `Dis-Integrated Corporation,'” in the Spring 1998 issue of New Labor Forum.)
There are precedents for such a form, whose applicability to American labor ought to be examined seriously. As conglomerate corporations emerged in the sixties and seventies, some of the AFL-CIO sectoral departments, such as the Industrial Union Department, which included most manufacturing unions, developed coordinated bargaining councils through which unions bargained jointly with multi-industry corporations like General Electric. Shop steward councils in British workplaces bring together representatives of the different unions in each workplace. In most of Western Europe, legally mandated works councils bring together the elected representatives, both union and nonunion, of all workers in a company. While US unionists have long feared that such an arrangement here would lead to “company unions,” the works councils have provided European workers with forms of influence over corporate decision-making that American workers sadly lack — notably a voice, albeit a limited one, in decisions about investments and layoffs. The European Union has now mandated Europe-wide works councils for transnational corporations.
New structures could be initiated by national unions and the AFL-CIO, but they are as likely to emerge from below. Groups that link workers across union lines, like Jobs with Justice and other labor/community coalitions, could be one starting point. The mass strikes that have shaken France over the past three years developed from and were directed by newly emerging workers’ assemblies that not only include employees from different unions but demand that rival unions cooperate to support the rank and file.
A restructuring of unions is only one pan of the solution to the problems posed by decentralized employers. The trend toward replacement of regular jobs with temporary, part-time or contract jobs — usually with no union representation, job security or benefits — affects not only those who are now working on a contingent basis but also those whose employers may threaten to convert their jobs to a contingent status. To deal with this, labor will have to move beyond collective bargaining with employers to create new social standards for all workers. Legislation is the usual way to establish such standards, such as legal rights to job security and fair benefits for part-time workers, but when legislatures are dominated by capital, labor must take a page from the national anti-sweatshop campaigns of the past and the international ones of today, which have imposed codes of conduct through direct action.
Going Global
The US labor movement grew in the womb of the nation-state. Its structure evolved to deal with national corporations acting in national industries and markets. Its right to exist was guaranteed by national labor laws. Its power depended on a national legal, political and cultural environment in which it could exercise significant influence.
While in a sense the economy has been global for 500 years, in the seventies corporations began to develop an unprecedented ability to move capital around the world with little regard for national boundaries. Goods and services were increasingly produced by a global assembly line in which different phases of production occurred in a series of locations in different countries. Corporations promoted the creation or expansion of global economic institutions, like the WTO, World Bank and IMF, and regional ones, like the EU and the structures set up by NAFTA, to protect and further their interests.
Globalization has had drastic effects on unions and workers. It has allowed business to pit workers, communities and whole countries against one another, establishing what has been called a global hiring hall and outflanking labor organizationally.
AFL-CIO president John Sweeney recently told corporate honchos at the World Economic Forum in Davos, Switzerland, that the global economy is a fait accompli; now national labor movements must come together to insist on minimum international labor standards and a seat at the table when the IMF negotiates bailout agreements that fall hardest on workers. “We will demand coordinated efforts to stimulate growth, to regulate currency and capital speculation, to extend labor and democratic rights,” he said.
At the rank-and-file level there has been considerable growth of local-to-local contacts among workers in the same industries through tours and “sister local” affiliations, especially with Mexico and Central America. Last year the San Francisco Labor Council and the California Labor Federation convened 400 union and community delegates from twenty countries for the Western Hemisphere Workers’ Conference Against NAFTA and Privatization. There has also been a growing involvement in combating sweatshops and supporting strikes and labor rights abroad. The cross-border cooperation seen in the struggle for union recognition at the Han Young subsidiary of Hyundai in Tijuana is one example of growing grassroots solidarity. (Major US industrial unions were asked to take a leading role in supporting this struggle but declined.) The AFL-CIO and its affiliates could further such networking and mutual support by facilitating e-mail and Internet communication among workers in the same companies, industries and occupations worldwide.
At an institutional level, the International Trade Secretariats, which include unions in major industry groups around the world, have been increasingly active in coordinating labor struggles internationally. They have helped form international union councils for particular corporations–for example, a council that coordinated the struggle to rehire locked-out US workers of Bridgestone/Firestone, and the ITF Word Council of UPS Trade Unions initiated by the Teamsters a year before last year’s strike.
These initiatives provide some possible starting points for redefining labor as a global movement. But relative to a capitalism that has spent the past twenty-five years elaborating global institutions and practices, labor’s effort has barely begun.
Beyond Class Compromise
After the intense class conflict of the late thirties and early forties, a large part of US business accepted the need to deal with workers organized in their own unions. Unions accepted “management’s right to manage” and restrictions on the right to strike in exchange for a share of the benefits of rising productivity. Full employment and union seniority systems provided considerable job security. While traditional victims of discrimination, notably women and people of color, did not benefit equally from this system, living conditions for most people improved substantially. The dominant wings of both major political parties also accepted this system and made no effort to dismantle it.
In response to the economic crisis of the early seventies, corporations began to reject the class compromise that characterized the period 1947-72. As UAW president Douglas Fraser put it in 1978, “The leaders of industry, commerce and finance in the United States have broken and discarded the fragile, unwritten compact previously existing during a past period of growth and progress …. leaders of the business community, with few exceptions, have chosen to wage a one-sided class war.” That war is most evident in the hiring of permanent replacement workers and the firing of 10,000 workers a year for attempting to organize.
John Sweeney has repeatedly called for “business and labor to see each other as natural allies.” But it is difficult to see under what conditions “the business community” — or, more aptly, global capital –will be interested in returning to a partnership with organized labor. Indeed, we are now seeing a burgeoning business counterattack in response to labor victories at UPS and on fast track. Such attacks are likely to increase. The challenge for labor is to find ways workers can empower themselves. Such a strategy requires a delegitimization of corporate power, the construction of a broad supportive coalition, the development of political independence and a mass mobilization of popular power.
From Growth to Sustainability
Since the New Deal, organized labor has promoted an economic strategy based on conventional economic growth. In this “Keynesian” approach, companies operating in the market are allowed to do their thing, but government fiscal and monetary policies maintain economic demand, insuring that companies do enough of their thing to provide full employment. Full employment, in turn, strengthens the hand of organized labor at the bargaining table. While conservative economic policy has for the time being marginalized this approach, it remains the centerpiece of organized labor’s economic program.
In this Keynesian approach, government fiscal and monetary policies aim to insure full employment without otherwise “interfering” with the market. Yet when workers were able to defend their conditions, such policies led to escalating inflation. Now that workers are virtually powerless, even relatively full employment doesn’t necessarily raise wages or reduce inequality-witness the current US economy. Further, while stimulation of national economies still increases jobs, in a global economy they are too often jobs in other countries. Finally and most important, conventional economic growth is leading to environmental degradation. Destruction of the environment hurts workers as human beings; it is also a central concern of most of the public and of the progressive social movements that labor needs as allies.
The challenge for labor is to develop an alternative economic strategy based on directing work to meeting social needs in environmentally sustainable ways. For example, when energy-related corporations mobilized against an international climate change treaty limiting greenhouse gases, they found a willing ally in much of labor. That split the labor-environmental alliance, which has been so crucial in the struggles over NAFTA and Fast Track — not to mention putting the future of the biosphere at risk. Organized labor instead could have presented an alternative program for reducing greenhouse gases while creating new, environmentally sound jobs for those displaced. An effort to develop such alternatives could benefit from engagement with those in the green tradition who have sought economic strategies for a genuine sustainable development that improves real conditions of life for the majority without destroying the environment.
The Reconfigured Working Class
For the first half of the twentieth century, US corporations concentrated their operations in urban centers. There grew the large ethnic communities that provided the base for the labor movement. That base has gradually been eroded by suburbanization and deindustrialization. From the fifties to today many middle-income people — mostly white — have moved to suburbs; so have most large modem workplaces. This geographical reorganization has been intensified in the era of corporate decentralization. Whole metropolitan regions are now divided into zones of different classes and ethnic groups. In Silicon Valley, for example, the homes, labs and offices of engineers and scientists occupy the northwest near Stanford University, while unskilled, largely immigrant production workers are concentrated around San Jose. The working class is now divided geographically, racially and economically between those with low-paid, insecure jobs centered in inner cities or other ghettos with staggering unemployment rates and those with substantially better-paid and more secure jobs.
Unions are among the few organizations with significant membership across this divide. The challenge for labor is to develop an alternative strategy for metropolitan regions that incorporates the needs of both urban and suburban working people — needs that are interdependent but not necessarily identical. Elements of such a strategy might include reorganization of transportation, land use, housing, employment and governmental systems. For example, plans for metropolitan reorganization that locate jobs in central cities while preserving open spaces on the fringe, and that provide public transit while concentrating housing and services at transit stops, could draw together a working-class constituency across the urban/suburban boundary. Such an approach has been spelled out by groups like Sustainable America, and preliminary efforts to implement it have been made by the labor-backed coalition Campaign for a Sustainable Milwaukee. These models could be adopted by the AFL-CIO’s Union Cities program.
The Good News in the Bad News
This is not the first time labor has had to adapt to a changing reality. When capitalism developed mass production, the integrated corporation and the national economy, craft unions were virtually banished from industrial America. It took labor half a century to create the industrial unionism that re-established union power. The good news is that when external conditions have forced labor to remake itself, the resulting transformation has ultimately created a movement far better able to meet workers’ needs.
The same could be true today. A labor movement that meets the challenge of the decentralized corporation will also have to be one that empowers workers in the workplace, links them across many boundaries that now divide them, and protects the most vulnerable as well as the most powerful. A labor movement that deals with globalization will overcome the national divisions that have long allowed workers to kill one another in wars that serve the interests of their employers. A labor movement that does not depend on partnership with capital will be freer to challenge capital’s power over economic and political life. A labor movement disentangled from the politics of growth will be able to propose alternatives to the inequality and crisis-and-stagnation cycles of market-driven economies and the threat they pose of further environmental devastation. A labor movement that links working-class interests across race, gender, cultural and other divisions without denying them can create a new governing majority that transforms politics at a local, a national and even a global level.