A recent article by business columnist Eduardo Porter in the “New York Times” was titled “Americanized Labor Policy Is Spreading in Europe.”
This is what the “Americanization of labor policy” means:
“In 2008, 1.9 million Portuguese workers in the private sector were covered by collective bargaining agreements. Last year, the number was down to 300,000.
“Spain has eased restrictions on collective layoffs and unfair dismissal, and softened limits on extending temporary work, allowing workers to be kept on fixed-term contracts for up to four years. Ireland and Portugal have frozen the minimum wage, while Greece has cut it by nearly a fourth. This is what is known in Europe as “internal devaluation.”
“Tethered to the euro and thus unable to devalue their currency to help make their goods less expensive in export markets, many European countries — especially those along the Continent’s southern rim that have been hammered by the financial crisis — have been furiously dismantling workplace protections in a bid to reduce the cost of labor.”
Cutting back on workplace protections is sure to increase income inequality while shrinking the middle class.
Porter writes that “These policy moves are radically changing the nature of Europe’s society.”
“The speed of change has certainly been very fast,” said Raymond Torres, the chief economist of the International Labor Organization in Geneva. “As far as I can tell, these are the most significant changes since World War II.”
“While most of the debate over Europe’s response to the financial crisis has focused on the budget austerity enveloping the Continent, the comparatively unheralded erosion of worker protection is likely to have at least as big and lasting an impact on Europe’s social contract.
“It has a disastrous effect on social cohesion and a tremendous effect on inequality,” argued Jean-Paul Fitoussi, an economics professor at the Institut d’Études Politiques de Paris. “Well-being has fallen all across Europe. One symptom is the rise of extremist political parties.”
“Europe’s strategy offers a test of the role played by labor market institutions — from unions to the minimum wage — in moderating the soaring income inequality that has become one of the hallmarks of our era.
“Inequality across much of Europe has widened, but it is still quite modest when compared with the vast income gap in the United States.
“The question is whether relative equity can hold as workplace institutions that for decades protected European employees’ standard of living give way to a more lightly regulated, American-style approach, where the government hardly interferes in the job market and organized labor has little say.”
This is a model that will ill-serve Europe and which should shame our political and economic leaders. Translated, it means that the rich get richer, the middle class shrinks, and the poor feel hopeless.
The 1% say that charter schools and Teach for America will close the gap that their policies created. They know it isn’t true, but it changes the subject enough to allow them to keep enlarging their share of the pie.
Reblogged this on Roy F. McCampbell's Blog.
In Spain they are dealing with 50% youth unemployment. They have figured out that agreements that make it difficult to fire anyone result in firms being reluctant to hire anyone new.
Of couse, the fact that the banks in Spain are truly insolvent and now are zombies living the ECB, and therefore not lending, while commercial economy, driven largely by the often illegal speculation in housing prices before the 2008 crash, has nothing to do with this.
Please, teaching. Try making your comments consistent with the facts and not neo-classical economic dogma.
If you are making a decision to hire someone that you must employ for the next thirty years, you will take fewer chances than if you are hiring a person that you can fire if things don’t work out. It is nothing to do with neoclassical economics, just logic.
But there’s no point in hiring when the economy is fundamentally broken. That’s logic too.
You both have good points. But TE and the author of the article need to explain that the labor agreements in Spain were/are more excessive than most other places in Europe. 33 (used to be 45 a few years ago) days of severance/redundancy pay for each year of employment for almost all workers whom are fired is very expensive for employers and unsustainable in a declining population and recession. They also failed to mention that employers in Spain used to benefit from making more excessive temporary contracts which ultimately are stable-job killers and keep the young out of the loop for jobs–that is, until the older, more experienced people retire or die. “Softened limits” means that they are curbing the benefits for employers making these temporary contracts.
There are probably a few other factors, too, like a serious population decline. We should probably “never give simplistic explanations [for] complicated” problems. Right?
I would certainly say labor agreements in Spain contained excessive job protections, but I have doubt that opinion would be shared by many who post here.
Spanish law has indeed created a two tier labor market, much to the determent of those who must be classified as temporary workers because the government has made it so expensive to hire permanent ones.
Indeed there are many causes for high unemployment in Spain and the rest of the world for that matter. I was not setting out to explain all of these causes, just pointing out that unemployment is made worse by insulating the employed from competition by the unemployed.
In Finland, the overall unionization rate is about 75% and its economy is doing pretty well. But according to teachingeconomist, Finland should be an economic basket case because of all those evil unions that protect lazy thuggish union workers. Germany has a strong union movement, the unions even have a seat at the table of the boards of directors of the big corporations, they have a direct voice at the seat of power of the big companies and yet Germany’s economy is in good shape. Germany’s auto companies are unionized and thriving. But according to teachingeconomist’s assumptions about unions, German auto companies should be bankrupt and out of business because of all those lazy thuggish mollycoddled union workers protected by the evil gangster unions.
Where did I say the Finish economy should be a basket case?
Geez, teaching, you can’t be as dumb as you pretend. According to you, iIf employers can’t get rid of people, it hurts the employment rate because employers are reluctant to hire. Unions make it more difficult for employers to get rid of people. Finland is highly unionized. Ergo, by your logic, Finnish employers should be reluctant to hire and they should have mass unemployment.
Dienne, don’t forget that our top scoring states are also the most unionized.
One might ask if unions create prosperity or prosperity creates unions. It is likely to be difficult to find which way the causal arrow goes.
No doubt Finish employers are reluctant to hire if it is difficult to fire people, but I never give simplistic explanations to complicated questions like the determinants of wealth and poverty in a society.
You might want to look at the labor practices in Denmark for an interesting system of labor support without forcing employers to hire workers in perpetuity.
Ann Ryand carpert sniffer,
You ever think that profit margins affect hiring, which is primarily determined by purchasing power coupled with supply and demand? Hiring personnel is not a ‘gift’ from the ‘supermen’ to the lowly ‘consumer.’ The only G8 country that follows your tripe economic theory is the U.S. and every indicator, save ‘financial instruments’ is rock bottom.
You have much nerve to inject this site with your drivel when teaches in this country are having to deal with the whole profession being diminished through greed in the face of destruction of learning.
If you have nothing to offer to the discussion, please refrain.
Short of legislation requiring all employers to hire more employees, I see no way to increase employment if the employers have no wish to hire more. Perhaps you have another plan?
If people are paid well, paid more than a subsistence wage, they will spend it, This will create demand. Demand should create more production, thus requiring more workers to be hired. More well paid workers creates even more demand. It is productivity, not austerity, that can revive our economy.
This is one of the last places I thought I would run across Say’s law that supply creates its own demand. I think that Keynes was basically correct. Interest rate changes are not enough to encourage people to increase spending when they become concerned that they might be unemployed. Unfortunately this increases the chances that they will be unemployed.
So we are danged if we do and danged if we don’t/ Are there no solutions? I wonder. If greed is the only motive … what else can trump that? Obviously, not conscience.
Unions are not perfect. But union-busting in US will be disastrous. FedEx and Subaru need to rethink their support of TFA…while countless classrooms and students need supplies, books, after-school programs– all kinds of help that could make a difference–TODAY.
Sadly, the answer is “yes”. We forget that the period of respect for labor rights (and other human rights) really lasted from about 1935 to about 1975, or between the Depression and the stagflation of the ’70s. Before FDR, labor rights were hard to obtain and enforce, even during the so-called Progressive Era. After ’75, the laissez-faire backlash began and is reaching a peak today.
Americans have a long history of being blood-thirsty capitalists, often recasting the Gospels to make even Jesus look like Gordon Gecko. The only time this has changed is when we’ve faced total social chaos.
I would hardly point to the period between 1935 and 1975 as the high point for human rights in the country. That is the period where things started to change, but today we enjoy far greater respect for human rights than during that transition period.
My point was that respect is deteriorating rapidly. We enjoy far less today than we had 40 years ago. Just read the newspaper.
I disagree. There has been significant progress with respect to human rights since the early 1970s. IDEA would not be passed until 1975, and implementation is still an ongoing process. Title 9 has just been passed, requiring women to be treated fairly by institutions of higher education. The Oglala Lakota and AIM are planning to take over the Pine Ridge Indian Reservation. It will decades before member of the GBLT community will be treated with anything close to full human rights.
You are resourceful, Ann Rand carpet sniffer: using the liberal civil rights movement against Western progressives on this site to denigrate the modicum of social democracy the industrial states enjoyed during the 20th century. There are many sycophants in economics departments. You should reconsider your prospects–there may not be enough right-wing think tank tits to draw nourishment from you selling-out.
I am not trying to denigrate anyone, just pointing out that the “good old days” were not good for many of our fellow citizens.
The Europeans will be fine; they have all that prior experience with serfdom and feudalism to fall back on.
No need for union busting, the unions are going down all by themselves in this neoliberal world. They are toothless. Seems that the elected officials, that they endorse always lose. Voters see that they do not stand on principle, which was their key asset.
Agreed. In many cases, and this is true in Germany as well, union management quietly joined hands with the owners.
It is a shame that most of life has to be a constant struggle between labor and management, between giving and taking, between compassion and indifference, between common sense expectations and false goals of absolute “efficiency”.
For the most part “workplace protections” are designed to protect current employees of a company from other potential employees of the company. Typically it is not a companies management that is dehumanized and made into the other, it is the “scab” .
I guess having to work 16 hour days under dangerous conditions for barely enough money to eat with (forget about doing anything else) doesn’t count as “dehumanization”.
Knock off the revisionist history, TE – I think people on this blog know what life was like before unions.
What revisionist history? I am just pointing out that the biggest threat to someone currently working in a job is that someone else will take the job. An important goal of job protections is to prevent the outsider from being able to threaten the insider.
If your interested in revisionist history about labor union history and the “other”, you might read The Wages of Whiteness: Race and the Making of the American Working Class by David Roediger or “Myth-Making as Labor History: Herbert Gutman and The United Mine Workers of America” by Herbert Hill.
During the 1950s, the unionization rate was at about 34% and the economy was doing just fine. According to the union haters, America should have been an economic basket case because of the relatively high unionization rate (the current unionization rate is at about 11.3%). Unions have been smashed, destroyed and suppressed and guess what? Wages are stagnant or low, good full time jobs have been replaced with part time low wage jobs, or low wage full time jobs and benefits have been slashed or eliminated with the virtual demise of unions in the PRIVATE sector (about 6.9% unionized). There is an all out war, a very well funded war, on unions, it’s no accident that there are far fewer unions today. The growing number of right to work states make it almost impossible to form unions and the Taft-Hartley Act is certainly no ally of unions.
If you don’t realize this, then you haven’t had to deal with the governors and legislators in Michigan, Wisconsin and Ohio. I am sure there are others. They perpetually SAY they are busting unions. And, jobs are pathetic. If you are victimized or were victimized by the mess in 2008 … you have a life no one would want. It still hasn’t picked up for us here. And, teachers are disrespected and under attack. They are lobbying for making Ohio a “Right to Work” (for nothing) state. It isn’t pleasant.
Most of the world’s productive capacity outside the United States was blown up in the 1940’s. This might be part of the explanation for the relative prosperity of US industry during that time.
There’s a good article in the current issue of Mother Jones about how the billionaire Devos family (founders of the Amway Ponzi-scheme) used its money to bully moderate Michigan Republicans into turning Michigan into a “right-to-work” state. Thereby smashing one of the last obstacles to Walmartizing the working class. Billionaires are becoming our de facto rulers.
The Republicans in Michigan have turned the party into a bunch of kooks. They do nothing but attack teachers and public ed and women’s rights.
until workers move into the streets and start to actually threaten with mass
strikes and riots , the system that keeps making life unbearable for them and their
families, will continue to become worse and make life more miserable.
I believe that current circumstances prevent taking things to the streets today. In past generations most people had nowhere to go but financially upward. Today, we have so many disenfranchised, college educated, ex-middle class people who have lost lifestyle, lost homes, lost retirement, unpaid bills, fear, disappointment, broken dreams. There is a huge difference in dealing with being a part of a society that is BECOMING middle class than one that is BECOMING poorer by the week.
The dynamic now is heading downward. Prosperity is leaving. Hope is waning. Those who never experienced poverty are less equipped to deal with it, to fend for themselves, to remain hopeful because they have fallen in purchasing power and self-esteem.
I don’t know anyone who would want to spend years going to college and wind up with a job that can’t pay the rent. Even fewer people can deal with earning a middle to upper middle class wage and to have the rug pulled from beneath them.
Our society is endangeredcfrom many perspectives.
The character of school faculty culture is changing as corporatization proceeds. I started my career in the East alongside an eclectic crew of free-thinking intellectual teachers, many of them steeped in union culutre. When I started working in suburban California I noticed a distinctly more corporate feel amongst the faculty, as if Silicon Valley ethos had infected the schools. I think NCLB and now Common Core are accelerating this shift. It’s harder to “let your hair down”, to sound cranky, or iconoclastic –in short, to be free –in schools these days. That same fearful, vigilant demeanor I see in Google and Oracle workers –that clipped way of talking, the watching of every word so as not to seem eccentric or stupid –is infecting teachers. One must cultivate an image of maximal efficiency and “effectiveness” (conveniently measurable in test scores). Bantering about education philosophy or politics marks one as a hindrance to the efficiency project. But schools need to be places where thinking and speaking can be messy, incomplete, broad and vague. If one restricts oneself to the crisp, measurable and neat, the Big Questions can never be addressed.
Ponderosa, I definitely agree with you and especially with this idea… “But schools need to be places where thinking and speaking can be messy, incomplete, broad and vague. If one restricts oneself to the crisp, measurable and neat, the Big Questions can never be addressed”. Since I’m a 60’s kid and a liberal I still risk speaking and writing my mind quite often to the principal, parents, and fellow staff, but in reality even I have lightened up as I need to work for at least another 5 to 6 years before retirement.
I’d like your name Ponderosa to use with your sentence above. Until then I will place your sentence in quotes giving the name of Ponderosa credit to my facebook wall.
Up to moosensquirrels at 10:09 AM & the ensuing discussion: yes, the timeline is right. We are talking 40 years. You all know, don’t you, that ALEC just celebrated its 40th birthday this past summer? The fruits of their labors? What we have here, today, 40 years later.
Oh, and in answer to the question posed in the title of this post:
No, not the American way. The American Legislative Exchange Council way.
There is a solution to all of this but every time I suggest it, I get comments like, “I only have so much time for making calls to congress. I am choosing to fight against high stakes testing. I can’t get into economics.” Although our congress is mostly made up of cowardly self interested do as little as possible type people, they are still required to answer their phones. If everyone who has ever visited this blog would call their rep in the House to demand that they cosponsor HR 129, and their senators to demand that they cosponsor Elizabeth Warren’s bill S. 1282, to REINSTATE THE GLASS STEAGALL ACT, we could begin to reclaim our country. It would immediately put an end to what Gordon Gecko described as the ultimate evil – speculation.
It is international bankers speculating with money obtained at 0%, with a 0 risk factor because they are too big to fail and will be bailed out by taxpayers that are demanding austerity in Greece and Spain and Portugal and Detroit. The bankers want their pound of flesh even though they are lying, cheating scumbags who deserve nothing. Glass Steagall wipes their speculative garbage off the books and leaves them holding nothing but the lint in their pockets. De-fund the billionaire boys club. That will put an end to the Common Core and the charters and ALEC. We are allowing them to proceed with the looting of our assets. We are allowing them to destroy our unions and our pensions. We should be talking about Detroit on this blog. That is the crime of the century.
The bankers should not be paid for their swindle while the workers of Detroit get paid 10 cents on the dollar in pensions. Outrageous. They can’t do it, if we don’t allow it. We outnumber them tremendously. That is why they are trying so hard to implement the Common Core because they can’t put everyone in prison but they can imprison people in their own minds. Imagination = Freedom. The CC does not allow imagination. It kills it. And it kills freedom right along with it. This nation has a unique Constitution. The CC is reducing it to an ELA cold reading of informational text with no historical context and no appreciation for the rights it grants us.
Spending time arguing about the importance of unions (which obviously brought prosperity to the people) is a waste of time. Better you discuss your plans for coordinating everyone you know to call congress and demand Glass Steagall NOW.
Congressional switchboard: 202 224 3121
I honestly don’t think they listen. They answer to the people who have bought their campaigns. Gates and Broad bought Obama and look at the result. No one is listening to the people on the ground who know what is going on. Teachers in this country have been beaten down, dismissed, and ignored.
“. . . who know what is going on.”
Or perhaps, a la 60s “What’s goin down”.
Does this mean you will not make the call? And you won’t tell anyone else about GS?
You are correct that they will not listen to one person. But when their phone lines are jammed with people all saying the same thing…. they hear and they act…not because they have been persuaded by any moral arguments but because they understand they will be tossed out next election if they do not do something. (They are all being blackmailed because the NSA has been spying on them too for years. Trust me they have a lot of good stuff on these guys. We have to become more overwhelming than that.)
Congressional switchboard: 202 224-3121
To Reinstate the Glass Steagall Act (to stop the looting and the speculation, to save our economy from the largest bubble implosion ever…700 trillion in worthless derivatives)
Luckily this bill has already been introduced in both houses:
HR 129 in the House
S.1282 in the Senate
Diane, I like to see your coverage of ours (West Contra Costa Unified School District) and other teacher unions in California which seem to be cutting their own throats, weakening themselves for the sake of siding with the administrations rather than with their members, the teachers. I’ve been teaching for 25 years and I’ve been a union rep in which ever school I’ve worked in. I’ve never run for office because I don’t see my skill in public speaking (unless it’s with my students), but none the less, I’ve been very active at rep council. Twenty years ago our union was a union to be reckoned with, a beacon for how unions should be run, but no longer. In party I also blame CTA for they are sending to us very weak links.
Well, the NEA has always been a “professional” organization that accepts administrators and teacher as members. Sometimes it seems that the administrative perspective wins out and therefore prefers “cooperation” to “confrontation”. But we should heed the words of the Temptations in “Smiling Faces”: http://www.youtube.com/watch?v=tlzyQSIm8AU
The NEA has been a corrupt institution exercising a corrupting influence on education since it was founded with Rockefeller money.
David Rockefeller, Chase Manhattan Bankster, says in his book, Memoirs on p. 405:
For more than a century, ideological extremists at either end of the political spectrum have seized upon well-publicized incidents such as my encounter with Castro to attack the Rockefeller family for the inordinate influence they claim we wield over American political and economic institutions. Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure – one world, if you will. If that is the charge, I stand guilty, and I am proud of it.