Jerry Jasinowski, president of the Manufacturing Institute at the National Association
of Manufacturers, warned U.S. workers last year, “From airline pilots to
auto assembly workers, employees need to help reduce their costs.” Economist
Peter Morici, a Clinton-era trade negotiator, likewise pronounced, “Companies
cannot provide gold-plated health care benefits and open-ended pension commitments.”
Yet employers have eagerly granted themselves “gold-plated”
increases in compensation while terminating pension and health benefits for
As United for a Fair Economy reported in August 2005, “The ratio of average
CEO pay (now $11.8 million) to worker pay (now $27,460) spiked up from 301-to-1
in 2003 to 431-to-1 in 2004. If the minimum wage had risen as fast as CEO pay
since 1990, the lowest-paid workers in the U.S. would be earning $23.03 an hour
today, not $5.15 an hour.”
Working-class incomes have fallen dramatically in the industrial Midwest over
the last six years. Median family income fell by 18 percent in Michigan and
12.2 percent in Illinois between 1999 and 2004. Illinois lost 220,000 manufacturing
jobs by 2004, and median income fell by $6,383 per household.
Declaring bankruptcy (with a wink and a nod) has developed into a corporate
trend, allowing multinationals to force U.S. workers into direct competition
with low-wage labor around the globe.
Delphi, the world’s largest auto-parts manufacturer, demanded wage cuts
of up to two-thirds when it entered Chapter 11 in October--while offering its
executives cash and bonuses estimated at $500 million.
United Airlines received cuts totaling $2.56 billion from its workers in each
year of a six-year contract when it declared bankruptcy in 2002. Now, having
reneged on employee pensions, United plans to offer 400 of its executives $115
million in company shares, on top of their already bloated salaries.
Profitable companies have also been emboldened to demand drastic wage and benefit
cuts from their workers to remain “competitive” in the global economy.
IBM, for example, recently jumped on the pension-bashing bandwagon--not because
it needed to, but just because it could.
The arrogance displayed by today’s employers rivals that of their
“robber baron” predecessors more than a century ago--when cutthroat
capitalists fought ruthlessly against every attempt by workers to raise safety
standards and wages, or to form unions.
Then, as now, the government aided and abetted in this project, whichever of
the two main parties happened to be in power. As historian Matthew Josephson
recalled of the late 19th century Senate, “the opposing party [the Democrats],
the ‘outs,’ were like the Republicans, who were usually the ‘ins,’
also led by masters of business or corporation lawyers.”
Shipping owner Cornelius Vanderbilt famously declared on one occasion, “Law?
What do I care about law? Hain’t I got the power?”
The early January Sago mine disaster highlighted a similar arrogance. In its
wake, the mainstream media suddenly “discovered” that many mines
still use century-old techniques, including underground explosives, while routinely
flouting safety laws without repercussion. Despite major advances in technology
in recent decades, many operators failed to update life-saving oxygen canisters
and underground communications, which could have saved the 12 Sago miners’
When confronted with these facts, Bruce Watzman, vice president of safety,
health and human resources at the National Mining Association, informed reporters
that coal operators are not responsible for updating miners’ safety equipment.
“We’re not in the self-rescuer manufacturing business,” he
Some things, of course, have changed in the last 100 years. Significantly,
today’s cutthroat capitalists are fighting ruthlessly to reverse all the
gains that unions won in the class battles of the 1930s.
With class inequality now comparable to the 1920s, it is worth noting that
the massive union struggles of the 1930s finally succeeded in shifting the balance
of forces between capital and labor. Corporations have been hell-bent on shifting
the balance decisively back toward capital ever since.
As Warren Buffett, the world’s fourth-richest man, noted in his 2004
annual letter to Berkshire Hathaway shareholders, “If class warfare is
being waged in America, my class is clearly winning.” If history has any
relevance, this won’t remain true for much longer.