How many readers of this newspaper noticed a few lines on last week’s front page praising labor unions? This was in a Labor Day statement from the U.S. Catholic bishops. It came at the same time we heard and saw news about low-wage fast food industry workers picketing in several cities for better pay and for unionization.
Last week also saw a 50th anniversary remembrance of the 1963 March on Washington, with a focus on the “I have a dream” speech of the Rev. Martin Luther King Jr. What was little noted about that long-ago event was its full meaning. The “march” was about racial injustice first, but its full call to action included economic justice. The complete title of the event was a March on Washington for Jobs and Freedom.
Among its demands was a raise in the minimum wage to $2 an hour, the equivalent of about $15 today, considering inflation over the years. What we actually have today is a federal minimum wage of $7.25. This is far from what Catholic social teaching has called a living wage, one that will support a family in modest circumstances.
According to a living wage calculator developed by the Massachusetts Institute of Technology, it requires pay of $16.93 an hour in Iowa to sustain a family of 2 adults and 1 child. This would cover only the basic necessities of life – food, shelter, clothing, transportation, education – and leave little or nothing for emergencies or savings.
What has this to do with unions? When workers can organize in unions to gain some degree of equality in power with employers, both their dignity and their economic well-being are protected. This is why the Catholic Church for over a century has “consistently affirmed the right of workers to form a union,” in the words of that Labor Day statement from Stockton, Calif., Bishop Stephen Blaire, chairman of the bishops’ Committee on Domestic Justice and Human Development.
When workers can be treated simply as individual cogs in a business machine, their dignity and their income are at the mercy of an employer’s good will, or lack of it. With power concentrated in the hands of the employer, it shouldn’t be surprising when the economy shows workers losing in the balance. As Bishop Blaire noted, “The rise in income inequality (in the U.S.) has mirrored a decline in union membership.”
When the union movement was strong in this country, in the middle decades of the 20th century, average pay was rising and the difference between high and average incomes was around 35 to 1. Now a common difference is over 100 to 1. At the very top, chief executive officers last year earned a typical 380 times what average workers took home.
To show what Bishop Blaire meant by the dramatic rise in inequality, that pay gap between CEOs and average workers was only 42 to 1 in 1980. Around that time, only 33 years ago, Peter Drucker, an influential management guru, proposed that CEO pay should not go beyond a 20 to 1 difference. The reason behind his view? Workers feel devalued and resentment builds when the differential is higher. This was confirmed more recently in a 2010 study by Northeastern University’s business school showing that worker productivity falls as the difference rises between their pay and that of executives.
It’s not that top bosses shouldn’t be well compensated. The issue is equitable sharing of the nation’s wealth. Currently, too much is concentrated in high incomes. This is what happened in the 1920s, just before the economic disaster we know as the Great Depression. The union movement pushed into mainstream American life after that, and the more equal power between management and workers led to a period of rising incomes and greater equality.
Critics of unions like to point out the faults of greed and corruption in their history. But union over-reach never led to an economic collapse like the financial industry greed that produced our recent Great Recession. The answer to poor behavior on both sides has the usual two elements: people with better morals, and relationships with a better balance of power. We need a revival of the union movement to revive a sense of solidarity.
This is why, in the words of Bishop Blaire, “The Church … wishes to collaborate with unions in securing the rights and dignity of workers.”
Frank Wessling
