Decent Wages And Benefits For Workers Essential In Free Enterprise System
But Monday, Oct. 17, Krugman had a column which should not be ignored. He pointed out that the bankruptcy at Delphi, formerly the parts division at General Motors, could provide the impetus or an excuse for a new round in wage and benefits cutbacks at General Motors itself. GM just obtained concessions on medical care benefits from the auto worker's union, the UAW.
The lead story in the L.A. Times today, by David Streitfeld, also summarizes these trends and is thoroughly alarming.
What is happening in the airlines, in too many of the big manufacturing industries, everywhere we look these days is that American business, pleading foreign competition and rising costs, is forcing the unions to abandon hard-won labor contracts and accept what amounts to a lower standard of living.
If this continues, one of the essential foundations of the American system, namely the ability of the workers to buy the products they produce, is going to be eroded.
It was Henry Ford, who, with the $5 dollar day, began paying his workers enough for them to be able to afford to buy Model T's. This brought about a revolution in living standards and made most Americans prosperous.
Now, that is all being eroded. And at the same time, the big companies are paying their executives more and more and entering into outrageously high severance agreements, such as Mark Willes got after he allowed Times-Mirror to collapse.
Krugman wrote yesterday, "There was a time when the American economy offered lots of good jobs -- jobs that didn't make workers rich but did give them middle class incomes. The best of these good jobs were at America's great manufacturing companies, especially in the auto industry.
"But it has been a generation since most American workers could count on sharing in the nation's economic growth. America is a much richer country than it was 30 years ago, but since the early 1970s the hourly wage of the typical worker has hardly kept up with inflation...
"Now the last vestiges of the era of plentiful good jobs are rapidly disappearing. Almost everywhere you look, corporations are squeezing wages and benefits, saying that they have no choice in the face of global competition. And with the Delphi bankruptcy, the big squeeze has reached the auto industry itself."
It's a good argument. Krugman concludes, "America's working class has been eroding for a generation, and it may be about to wash away completely. Something must be done."
One thing to be done is to return the Democrats to control of Congress next year. Ineffective and confused as the party often is, Democrats will still do a better job of protecting American workers than the Republicans.
And, of course, in the special election here in California, the electorate should reject the Schwarzenegger trick, backed by the foolish editorial page of the L.A. Times, to disarm the public employee unions.
The time may come for a general strike of a day or two by working people in this country. That would send a powerful message.
Many of the current bad trends stem from evil globalization. This is having the effect of leading many working Americans back to being peasants.
Yes, we have to defend ourselves in the War on Terror. But in doing that, the Bush Administration often seems willing to throw out the baby with the bathwater, and let American workers lose the resources they have had since Henry Ford and Franklin D. Roosevelt.