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Welcome to the McJobs Recovery

How the McEconomy hollowed out the middle class.

| Mon May 9, 2011 2:28 PM EDT

The distorting effects of the barbell economy aren't lost on ordinary Americans. In a recent Gallup poll, a majority of people agreed that the country was still in either a depression (29%) or a recession (26%). When sorted out by income, however, those making $75,000 or more a year are, not surprisingly, most likely to believe the economy is in neither a recession nor a depression, but growing. After all, they're the ones most likely to have benefited from a soaring stock market and the return to profitability of both corporate America and Wall Street. In Gallup's middle-income group, by contrast, 55% of respondents claim the economy is in trouble. They're still waiting for their recovery to arrive.
 

The Slow Fade of Big Labor

The big-picture economic changes described by Autor and others, however, don't tell the entire story. There's a significant political component to the hollowing out of the American labor force and the impoverishment of the middle class: the slow fade of organized labor. Since the 1950s, the clout of unions in the public and private sectors has waned, their membership has dwindled, and their political influence has weakened considerably. Long gone are the days when powerful union bosses—the AFL-CIO's George Meany or the UAW's Walter Reuther—had the ear of just about any president.

As Mother Jones' Kevin Drum has written, in the 1960s and 1970s a rift developed between big labor and the Democratic Party. Unions recoiled in disgust at what they perceived to be the "motley collection of shaggy kids, newly assertive women, and goo-goo academics" who had begun to supplant organized labor in the Party. In 1972, the influential AFL-CIO symbolically distanced itself from the Democrats by refusing to endorse their nominee for president, George McGovern.

All the while, big business was mobilizing, banding together to form massive advocacy groups such as the Business Roundtable and shaping the staid US Chamber of Commerce into a ferocious lobbying machine. In the 1980s and 1990s, the Democratic Party drifted rightward and toward an increasingly powerful and financially focused business community, creating the Democratic Leadership Council, an olive branch of sorts to corporate America. "It's not that the working class [had] abandoned Democrats," Drum wrote. "It's just the opposite: The Democratic Party [had] largely abandoned the working class."

The GOP, of course, has a long history of battling organized labor, and nowhere has that been clearer than in the party's recent assault on workers' rights. Swept in by a tide of Republican support in 2010, new GOP majorities in state legislatures from Wisconsin to Tennessee to New Hampshire have introduced bills meant to roll back decades' worth of collective bargaining rights for public-sector unions, the last bastion of organized labor still standing (somewhat) strong.

The political calculus behind the war on public-sector unions is obvious: kneecap them and you knock out a major pillar of support for the Democratic Party. In the 2010 midterm elections, the American Federation of State, County, and Municipal Employees (AFSCME) spent nearly $90 million on TV ads, phone banking, mailings, and other support for Democratic candidates. The anti-union legislation being pushed by Republicans would inflict serious damage on AFSCME and other public-sector unions by making it harder for them to retain members and weakening their clout at the bargaining table.

And as shown by the latest state to join the anti-union fray, it's not just Republicans chipping away at workers' rights anymore. In Massachusetts, a staunchly liberal state, the Democratic-led State Assembly recently voted to curb collective bargaining rights on heath-care benefits for teachers, firefighters, and a host of other public-sector employees.

Bargaining-table clout is crucial for unions, since it directly affects the wages their members take home every month. According to data from the Bureau of Labor Statistics, union workers pocket on average $200 more per week than their non-union counterparts, a 28% percent difference. The benefits of union representation are even greater for women and people of color: women in unions make 34% more than their non-unionized counterparts, and Latino workers nearly 51% more.

In other words, at precisely the moment when middle-class workers need strong bargaining rights so they can fight to preserve a living wage in a barbell economy, unions around the country face the grim prospect of losing those rights.

All of which raises the questions: Is there any way to revive the American middle class and reshape income distribution in our barbell nation? Or will this warped recovery of ours pave the way for an even more warped McEconomy, with the have-nots at one end, the have-it-alls at the other end, and increasingly less of us in between?

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