Pity the Millionaires: Killing Unions, the Public Sector, and the Middle Class from Indiana to San Diego – America’s Finest Tourist Plantation

San Diego Labor rally in front of the County Admin building, Feb. 26, 2011.

In response to last Wednesday’s kick-off press conference for the Millionaires Tax Initiative here in San Diego, Channels 6 and 10 were careful to give well over half of the time in their stories to local right-wing libertarian anti-tax nut Richard Rider.

Rider, the chairman of the San Diego Tax Fighters, opined that:

“If people think that rich people are greedy, why would they think that they wouldn’t move out of state if the taxes got too high? . . . It’s a very interesting conflict in their reasoning.”

Richard Rider.

Other than mischaracterizing a call for the top 1% to pay their fair share to help support education and vital public services as an ad hominemattack on the greedy rich and making the evidence-free claim that an extra 3% in taxes will force Hollywood stars and CEO’s to strap their hot-tubs on their Mercedes and head for Arizona, he was spot on.

For those who are wondering, there is zero evidence to support the claim that higher individual or corporate tax rates in the past hurts job creation or forced a mass migration of afflicted plutocrats. Indeed as Warren Buffet has pointed out, there was actually more job creation when taxes were higher on the rich than they are now.

Other than observing the sadly predictable fact that almost all of the San Diego media are addicted to giving factually challenged right wingers like Rider and the omnipresent fabricator Carl DeMaio seemingly unlimited free air and press time unencumbered by fact-checking, what was most important about the report on 10 News was the last line of the story:

“Rider said a better solution would be to privatize everything from prisons to libraries and reform the California pension system.”

This is where we are now: the advocates for radical privatization who are seeking to roll back the twentieth century have been blithely mainstreamed. Some readers may think that Rider’s lust to bust all the unions and “privatize everything” combined with his pity for the blighted rich are so extreme as to take him out of the mainstream of American politics, but this is simply no longer true.

 Broadcasting Live from Shit Work Nation

Recently, with far less fanfare than the Madonna halftime show during the Super Bowl received in Indianapolis, Hoosier Republicans jammed through a bill that made Indiana a “right to work” state, the first in many years.

Despite the fact that there is no empirical evidence whatsoever to support the argument that “right to work” laws create jobs, the GOP in Indiana marched forward nonetheless citing job creation as their ultimate end. Interestingly, there is plenty of empirical evidence that the kinds of non-union jobs that will follow from this legislation will be lower paying than the union jobs that preceded them and that busting unions actually may hurt job creation while weakening the middle class.

In a recent report, “Weak Unions, Weak Economy: Why the Decline of Organized Labor Makes it Harder to Revive Growth,” the nonpartisan public policy group Demos notes:

To understand how a decades-long legacy of union busting is making our recovery harder, consider the role that organized labor has traditionally played in ensuring that working people – who make up most consumers — receive a larger share of the economy’s gains and thus have money to spend consuming.

Unions bargain collectively for better wages and benefits for their members. But unions also raise compensation for workers they don’t represent: a recent study by professors Bruce Western and Jake Rosenfeld finds that by scaring non-union employers into raising wages to avoid unionization, promoting norms of fair pay, and lobbying for public policies that raise wages, unions substantially boost compensation for non-union employees in addition to their own members.

In short, high unionization boosts the share of economic growth going to working people rather than to corporate profits or the very highest earners. That is good for consumer spending given that Americans of moderate means are more likely to spend additional money than the wealthy, who already are consuming at their desired level, or corporations, which may just pile up more cash.  Unfortunately, though, unionization rates have been in decline for decades and the share of national income going to the middle class has fallen too.

Meanwhile, the proportion of pay held by the highest-income Americans has shot up dramatically: in 2007, the top ten percent of households earned 49.7 percent of the nation’s income.

Factors like globalization, technological change, and especially the demand for highly skilled workers that has put a premium on the value of a college education contribute to the divergence between the middle class and the wealthy, but Western and Rosenfeld make a powerful case that the decline of union representation was also a major influence – contributing as much as third to the growth of income inequality among working men since 1973.

Without unions or any other organized force to fight for workers’ share of economic gains, the middle class is dwindling – and so is its purchasing power. This trend was obscured during the early 2000s as Americans tapped credit cards and rising home equity to support their consumer spending. The disempowerment of working people is so complete that American workers have received just over one percent of income growth since the recession technically ended in the second quarter of 2009.

Meanwhile 88 percent of real national income went to corporate profits. “The absence of any positive share of national income growth due to wages and salaries received by American workers during the current economic recovery is historically unprecedented” pronounced economists at Northeastern University who analyzed the numbers. No wonder corporations are sitting on tremendous cash reserves and working people can’t generate enough demand to give businesses a reason to hire.

So if the economic reasoning of the Indiana Republicans doesn’t hold water, what is their real agenda?

It’s simple: if they gut unions’ ability to collect dues, they hurt the political base of their opponents, plain and simple. If it screws the middle class, so be it. The folks at GOP central know that they get a lot more campaign cash from the rich, thus the cries of angry union workers are drowned out by the cha-ching! of incoming cash. Those in the plutocrats’ club also know that (surprise!) the corporate media is doing an awful job of reporting on the real agenda of the right, so the average American doesn’t know ALEC from Adam. So don’t worry, be happy, billionaires.

Out West similar union-busting policies are being pressed by Arizona Republicans who are rushing forward to pass four bills that make Scott Walker’s assault on workers in Wisconsin look meek. Three of them would restrict the way unions collect dues and change the way workers get paid for doing union work. The last bill bans collective bargaining for all state and local workers, including cops and firefighters. Why?

According to the bill’s sponsor, state Arizona Senator Rick Murphy, “It seems as though those employees or at least the unions that represent them don’t care what the burden is on the taxpayer as long as they get theirs.”

Murphy got help crafting these bills from Nick Dranias of the Phoenix-based Goldwater Institute, a libertarian /conservative think tank. Dranias’s complaint: public-sector workers in Arizona make about 6 percent more in salary and benefits than their private-sector counterparts. Thus, the impact of this legislation will not be to bring the pay of all workers up, but rather to drag the pay of public sector workers down. And with no upward pressure on wages, it’s much more likely that non-union workers’ wages and benefits will either stagnate or decline. Take that, middle class! Hey at least the librarians and firefighters are eating shit too, right?

At the Federal level, the Republicans in Congress just held out on reauthorizing the Federal Aviation Administration until it included changes in federal labor law that make it harder to organize unions and easier to decertify them. As Labor Notes, reported:

Two years after President Obama and Democrats abandoned labor’s much-anticipated Employee Free Choice Act, they have refused to block Republicans intent on making life miserable for airline and rail workers. A bill reauthorizing the Federal Aviation Administration, voted up 75-20 in the Senate, changes federal labor law to make organizing more difficult for railroad and airline unions. New rules will make it easier to decertify unions and harder to win elections when employers merge. Only 14 Senate Democrats stood with labor to oppose the measure in a February 6 vote. One independent and five Republicans also voted against the bill. Democrats hold 51 Senate seats.

As this report observes, while the GOP drove this effort, those looking for profiles in courage from the Democrats and/or Obama have had very slim pickings. It should be said, however, that San Diego mayoral candidate Congressman Bob Filner, a senior member of the House Transportation and Infrastructure Committee, voted against the bill in committee.

Welcome to America’s Finest Tourist Plantation

Finally, our local mayoral race is crucially important if you’d like to halt the sprint toward privatization at the local level. As I have pointed out in multiple columns, frontrunner Carl DeMaio is the pure product of the right wing think tanks at the local, state, and national level and is in line with the exact kind of radical privatization that Richard Rider espouses. And if you don’t want to believe me, check out dirtydemaio.com for other sources.

Unfortunately, because of our largely barren local media landscape, DeMaio has been able to promote himself as a populist reformer rather than the tool of monied interests that he is and always has been. From his constant demonization of city workers to his assault on the living wage to his attacks on the very notion of the public sector, nobody loves kicking people when they are down more than Carl DeMaio. His history with Newt Gingrich, his time with the K Street crowd in Washington DC during the halcyon days of the Abramoff scandal, and his intensive tutelage in the halls of the corporate-funded right wing think tanks has prepared him well to bring the dream of the draconian Social Darwinist free marketeers to fruition.

While there are plenty of problems with the Democrats, locally and nationally, any political analysis with even the slightest bit of nuance would suggest that this is a race that Filner has to win or we’ll go from Enron by the Sea to the Wisconsin of the West or perhaps better yet, America’s Finest Tourist Plantation—the utopia of the libertarian right where union busting and privatization will always be on the top of the agenda and creating good paying jobs for working people or doing much of anything to help the middle class is off the table. In DeMaio’s San Diego, profit will be privatized and remain in the hands of a few while risk and responsibility will be socialized. This guy really wants to sell the commons, San Diego. It’s time to get a clue.

As of this writing, San Diego Democrats are displaying their historically predictable lack of cohesion with some, like the brain dead Democrat Lyn Schenk, shilling for local GOP establishment favorite Bonnie Dumanis or others pining after the Ken Doll of the Tea Party and Grover Norquist crowd, Nathan Fletcher. The alternative is to elect the most progressive mayor in the history of San Diego, Bob Filner. If local Democrats and progressives can’t get behind that, we’re all going to pay a very steep price.