Article — From the July 2009 issue
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Article — From the July 2009 issue
Before dispatching the Arkansans to their lobbying mission on the Hill, Zook made a forceful declaration: “It is critical that we take the view that our beef is not with organized labor but with a terrible piece of legislation.” This is a central talking point — cooked up by Navigators Global, the chief public-relations firm for the anti-EFCA coalition — but it is not convincing on even a cursory examination of the coalition’s leadership and its prehistory.
Indeed, the campaign to defeat EFCA is best seen as the latest onslaught in a business crusade to destroy the labor movement, one that began in the early twentieth century but has been waged with increasing intensity only since the mid-1970s. During 1974 and 1975, with the specter of stagflation looming — and amid the twin political crises of Vietnam and Watergate — top corporate officials held a series of meetings under the auspices of The Conference Board. The climate was dark. Feeling pressured by the unions, as well as by the demands of an ungrateful citizenry, the assembled CEOs feared a popular revolt might be imminent. “We have been hoist with our own petard,” one executive said. “We have raised expectations that we can’t deliver on.” Another executive complained, “One man, one vote has undermined the power of business in all capitalist countries since World War II.”
With profits down and debt up, business determined that the rules of the game had to be changed in its favor. “[I]t will be a hard pill for many Americans to swallow — the idea of doing with less so that big business can have more,” Business Week stated bluntly in 1974. “Nothing that this nation, or any other nation, has done in modern economic history compares in difficulty with the selling job that must now be done to make people accept the new reality.”
A key part of the sales job was an ideological attack on unions. In order to target universities, intellectuals, and the media, corporations shoveled cash into conservative think tanks. They also vastly increased their lobbying efforts — as Kim Phillips-Fein recounts in her new book, Invisible Hands, most Fortune 500 firms didn’t have Washington public-affairs offices in 1970, but 80 percent did by 1980 — and poured money into the political system as well. Justin Dart, chairman of California’s Dart Industries and a major financial backer of Ronald Reagan, was an early champion of corporate political-action committees. “I don’t advocate that business buy a legislator,” he said in 1978. “Rhetoric is a very fine thing; a little money to go with the rhetoric is better. They listen better.”
Around the same time, unions sought to push through a labor-law reform bill that shared many features with EFCA. The legislation would have made it easier for workers to organize, by streamlining the process of holding elections under the oversight of the National Labor Relations Board and imposing stiff fines on companies that fired activists. The Business Roundtable, the traditional political leader of major corporations, had generally hesitated to take anti-union positions in public, and some members initially declined to oppose the bill. The group ultimately joined the fight, however, as did a number of major trade associations and the newly revitalized U.S. Chamber of Commerce, which represented smaller businesses and took a much harder line toward labor.
As with EFCA today, the business interests in the late 1970s mounted a multimillion-dollar campaign that included a massive lobbying effort by CEOs from around the country to pressure Congress, as well as the formation of “grass-roots” coalitions and the purchase, from friendly economists, of research concluding that the bill would all but destroy the U.S. economy. As with EFCA, the Dem ocrats controlled both houses of Congress and the White House, and the legislation had overwhelming support in the House of Representatives. Yet the unions couldn’t get it through; in the end, it was filibustered to death by Senators Orrin Hatch and Richard Lugar. “For the first time in twenty years, the business community had vanquished organized labor in a fight over a ‘gut’ issue for labor,” the New York Times observed at the time. No significant revision of union-organizing laws has taken place since then, as labor’s ranks, and influence, have steadily dwindled.
In 1954, there were 17 million union members, which then meant 35 percent of the workforce. This was the high point of unionism in the country and also was, not coincidentally, when the American middle class was created. The decline of the union movement since then has been accompanied by growing social inequality, slashed salaries, and, for the first time in American history, a de-linking of rising productivity from rising wages. Labor has had almost no voice in any administration since 1980, including that of Bill Clinton, whose White House political director, Rahm Emanuel (now Obama’s chief of staff), was a chief operative in passing NAFTA over the strenuous objections of labor; moreover, Clinton’s chief of staff, John Podesta (who led Obama’s transition team), spearheaded the campaign to pass Permanent Normal Trade Relations with China, which further decimated union jobs.
Under George W. Bush, all the key agencies were stacked with anti-union appointees. Bush’s labor secretary, Elaine Chao — the wife of Senate Minority Leader Mitch McConnell, and now a “distinguished fellow” at the Heritage Foundation — worked openly against EFCA, saying in 2007, “A worker’s right to a secret-ballot election is an intrinsic right in our democracy that should not be legislated away at the behest of special-interest groups.” The attorney Robert Battista, whom Bush appointed chairman of the NLRB, had during the 1990s counseled Detroit’s newspapers on union-breaking and now works for a law firm that advises companies on how to keep unions out.
Although the business lobby has framed its opposition to EFCA around the issues of the “secret ballot” and labor “coercion,” the current rules give management a chokehold over union elections. Employers can require that workers attend “captive audience” meetings, that is, anti-union presentations during the workday at which union supporters are forbidden to speak. Firing of union activists and intimidation of employees during organizing drives are routine practices and have been encouraged by lax enforcement of the law: according to the NLRB’s most recent annual report, it took an average of about eighteen months for administrative-law judges to rule on charges of unfair labor practices. In the uncommon cases where an employer is found guilty of illegally firing or demoting a worker, the firm typically needs only to reinstate the worker and pay back wages, minus any income the worker may have earned in the interim. With delays so long and penalties so minor, as the group Human Rights Watch noted in a recent report, companies often regard fines as “a cost of doing business — a small price to pay for defeating worker organizing efforts.”
Ken Silverstein Ken Silverstein is the Washington editor of Harper's Magazine.
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