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Published On: Thu, Jan 31st, 2013

Robert Reich calls for massive Wal-Mart, McDonalds and hospital labor unions

Robert Reich, the former Clinton labor secretary turned MSNBC contributor, targeted some of America’s largest companies calling for a massive union of their forces and argues that these companies should embrace a labor union.

Sally Field Norma Rae Union sign photoIn the Jan. 29 Huff Po piece, Reich writes:

“Almost a quarter of all jobs in America now pay wages below the poverty line for a family of four,” wrote Reich. “The Bureau of Labor Statistics estimates 7 out of 10 growth occupations over the next decade will be low-wage — like serving customers at big-box retailers and fast-food chains.”

“Wealthy Americans,” he continued, “would do better with smaller shares of a rapidly-growing economy than with the large shares they now possess of an economy that’s barely moving.”

As a result, they should “support public investments in education and job-training, a world-class infrastructure (transportation, water and sewage, energy, internet), and basic research — all of which would make the American workforce more productive.”

Reich continues.

“If they were rational they’d even support labor unions.”

In Reich’s view, employers should support unions coming in and assisting or coordinating how much they should pay their employees.

After discussing how union membership has plummeted in this country in recent years, Reich made a bold request.

“Walmart is a microcosm of the American economy,” he said. “It has brazenly fought off unions. But it could easily afford to pay its workers more. It earned $16 billion last year. Much of that sum went to Walmart’s shareholders, including the family of its founder, Sam Walton.”

The Clinton aide points out that “the wealth of the Walton family now exceeds the wealth of the bottom 40 percent of American families combined.”

In Reich’s view, this is at risk due to the condition of today’s economy and he has this solution.

“Walmart should be unionized. So should McDonalds. So should every major big-box retailer and fast-food outlet in the nation. So should every hospital in America.”

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About the Author

- Writer and Co-Founder of The Global Dispatch, Brandon has been covering news for Examiner, starting and writing for several different websites including the diverse blognews site Desk of Brian. To Contact Brandon email [email protected] ATTN: BRANDON

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  1. Frank Crowe says:

    Reich should face up to economic realities, including the fact the unions themselves have caused many of the problems they are facing today. First, flipping burgers at a fast food chain is a starter job. One intended to help low skilled, no experience workers get that first job. Learn what it is like to report on time every shift, how to work with others, develop a work ethic, etc. And in this way they perform a valuable function. These jobs are low skill jobs, and therefore low pay, they were never intended to provide a wage that would support a family of four. If they did, the dollar menu would be a five dollar menu, and thousands of restaurants would close. Who benefits from that?

    As a former HR Director for a large corporation, I can attest that wages are often not the issue that makes employers avoid unions. It is the arcane work rules and their insistence in defending employees who are rule offenders. Insisting on narrow job descriptions designed to force employers to hire more workers than they need, defending those who should be fired, may get a union steward re elected, but is just the thing that pushes companies to Right to Work states. Our public schools are failing us not because of a lack of funding. There is no positive correlation between dollars per pupil and graduation rates or scores on standardized test scores. D.C. Spends more per pupil than almost any state in the nation, and has some of , if not the worst schools in the country. Does anyone think even more money would help? The reality is good teachers make the school. We do not pay the many good teachers enough because the money is going to the incompetent ones who cannot be fired thanks to teachers unions. Check with your local school board and ask how many teachers have been fired in the last five years got “failure to perform at an acceptable level” the answer will be none. If you were a smart young person would you want to enter a profession where you are not rewarded for your success in the job, instead paid just for showing up? Look at the recent teacher strikes in Illinois, they refused any contract that based ratings on performance in any way. Unions and our current political leadership are failing the country because they are designed to punish good behavior (success/strong performance) and reward poor behavior. Reich is a socialist who wants equal results for all, with no corresponding demand for equal effort. He never meet a problem that could not be solved by spending more of someone else’s money.

  2. Tom Perkins says:

    I have no problem with Wal-Mart giving all their employees an x% wage increase across the board. But it should be for the same reasons that Costco chooses to pay above average wages for comparable work, not because some union extorted the increase out of them. Union leadership is rarely interested in a partnership sharing concerns for the long-term financial security of the “host”.

  3. Michael says:

    Its unfortunate Mr. Reich didn’t consider the impact on income disaprity when he and other Democrats supported NAFTA and sought/seek MFN status with China. Having assisted the relocation of many skilled and semi skilled jobs (with decent wages) in manufacturing – hello Norma Ray – he now wants unskilled workers, largely p/t, in those service industries where relocation is impossible, to earn a decent wage.

    Why not raise the minimumm wage to $15.00/hr.? Same effect, but without the growth of union officers, business agents, and workrules – none of which add value to the economy.

  4. scribble73 says:

    Unions should be lead by their memberships (not by a corporate-style Executive board) and have permanent seats on the Walmart/Target/McDonalds/CVC/Safeway/WholeFoods Boards of Directors.

    What’s with the first two crazy-long posts? Who do those two guys think they are?

  5. Mr. Reich,
    Although I am advert supporter of unionization, however your reasoning concerning low wages in America is not the primary cause of large corporations such as Walmart, McDonald’s, and low wage hospital personal. It is the direct influence, possibly the worst legislative bill any president has ever signed under your watch as Secretary of Labor for the Clinton administration. You of all people, as secretary of labor during the Clinton administration has allowed President Clinton to sign the North American Free Trade Agreements between Mexico and Canada. As secretary of labor, you were supposed to look out for the needs, concerns, hardships, and triumphs of the American people first. You weren’t supposed to look out for the interest of corporate America. By doing so , you in essence has achieved the award as being the greatest NASCAR DRIVER this country has ever had as secretary of labor.

    THIS IS NO WAY TO TREAT AMERICANS!!!

    Dear Mr. Reich,
    Concerning our Nations Economic problems, I am addressing a solution that I believe will aid in reigniting our country into an engine of prosperity for us and our children’s future.

    After seeing our Nation on the verge of collapsing economically, all while passing a 16 trillion dollar National Debt, and knowing that millions of Americans are facing the worst calamity since the great depression, I am writing this essay after the failed passage of “The Bring Jobs Home Act., S.3364

    The following is my suggestion and views as a businessman in the town of Astoria, borough of Queens, and the great State of New York in bringing American Manufacturing and American Industry back to the United States of America.

    I cannot understand how our political leaders, on both sides of the isle, are not putting the interest, concerns, hardships, and triumphs of the American people first.

    42 Senators blocked the S.3364: Bring Jobs Home Act on July 19, 2012. This bill would have banned tax deductions for companies that move their businesses overseas. It also would have given a 20 percent tax credit for companies returning from overseas. It would have created millions of jobs across our Nation, thus, igniting a fire of independence among millions of Americans, returning our Nation into an engine of prosperity.

    The bill failed by a 56-42. A count of 60 was required to end discussion and move to a final vote.

    Instead of owning up to what they done, the Senate swept it under the rug. This short 10 page bill addressed the problem of nearly 24 million Americans out of work, nearly 49 million Americans on the poverty line, badly damaging our economy.

    Their are those politicians who are riding the waves of the unemployed and poverty lines. Then their are those politicians who are riding the waves of the affluent. All while the economic work force of America, America’s Middle Class, is on the road of uncertainty.

    Its not that our leaders have been neglecting what their responsibilities and duties are, but their indirect paths and course of actions for which they are pursuing, is the direct cause of mass unemployment, extreme poverty, loss of one’s self esteem; as well as this nation’s generation being dependent upon one’s government.

    Their inept ability to control our expenditures should be reason for termination from public office.
    They had to be sleeping @ the wheel

    Not too long ago, our forefathers left a nation that was guided by the crown of Imperialism to a land envisioned by FREEDOM.

    Freedom, a gift from our forefathers, paid for by their blood, sweat, and years (tears) of hard work, only to be “laid to rest” by the stroke of a pen.

    Imperialism has led our forefathers to leave a Nation guided by its Crown, settle in a new land, envisioned by FREEDOM, now only to have its children abandon by the “Wings of Capitalism.”

    Industrialization, once the fuel of our Nation’s Economy, only to leave our shores in pursuit of “The Almighty Dollar”.

    Its not that Industrialization has abandoned our nation directly, but indirectly, our legislatives has given it wings to settle and prosper on foreign land.

    Because of the passage of these legislation’s, millions of America’s children, as well as their parents are now facing the worst economic times since the Great Depression.

    What is the sense of getting an education, racking up our children debt, only to find out America’s jobs are no longer within one’s reach.

    Jobs are not a God given right, although, it may be an earned right, especially when our parents and forefathers worked a life time building a Nation for their children’s future.

    Concerning our nations job market, “Free Trade” along with a so called “Global Economy”, has led Americans to a road block. Capitalism progressive strides to globalization is inevitable, although, it shouldn’t be at the behest of American labor, and especially its children.

    Since the signing of the free trade agreements, America’s Industries have been leaving in droves. It left Americans on the unemployment and poverty lines.

    What a horror to know millions of Americans can no longer afford basic essentials.

    The signing of NAFTA (1992), implemented January 1st., 1994, perhaps the single worst legislation this country has ever passed, along with CAFTA, (2006), the icing on the cake, pushed forward the inevitable, manufacturing plants leaving our country and settling abroad.

    It left behind towns and local municipalities across our nation, along with their citizens, unemployed and helpless.

    Revenue has stopped flowing for
    local municipalities. Business closed, people out of work, people loosing their homes, health insurances, unable to pay their bills.

    Americans, all across our nation, especially, a town in Georgia, Millen, @ a 21 percent unemployment, became The Town That Jobs Forgot.

    Americans are resilient and tough. They can cope with change. But when change takes away the dream of owning your own business, your own home, your job, unable to pay your bills, raise your family, your way of life, thus, the American dream is all broken up, taken away by the stroke of a pen. A legislation signed by our leaders, hoping to change and improve the world, but leaving behind a country (USA) “without jobs”.

    One (1) thing I do know, and this is a no brainier. If our nation would bring our manufacturing plants home, millions of Americans will be employed. Tax revenue will be generating once again. A fire of wealth, (taxes) would be ignited.

    Americans would be generating goods and services. Americans would once again be dependent upon themselves rather to depend on the government and outside resources.

    Its been nearly 20 years, “where are our current elected officials on this most important subject”. “Can’t anyone see that Nafta, Cafta, and now the signing of the “Asia America Free Trade Agreement” doesn’t work”.

    Its great for the foreign countries who picked up our slack after thousands of American Corporations went out of business or moved abroad. And It’s great for the executives and shareholders who invest in American Corporations that is based on our homeland while the manufacturing plants are housed overseas.

    The free trade agreements must be revamped, along with its loopholes allowing American corporations to leave our home land, settling on foreign land, manufacturing goods, re-directing its merchandise back to the United States of America.

    As an American manufacturer my-self, I truly believe, if you want to sell a product here, it should be made here in America. If an American manufacturer decides to settle its wings abroad, then they should be outlining a method to cater to that particle geographic area regarding its consumers. Let them open up manufacturing plants abroad for the sole purpose of catering to the area’s geographic consumers.

    Its not that I am against free trade, I am against the unfettered free trade.
    American corporations leaving our home land, making deals with foreign governments, throwing Americans on the street, for the sole reason of cheap labor, avoiding labor laws, escaping regulatory regulations, and the “greed and pursuit” of the “almighty dollar.”

    I also believe if these American Corporations who seek the support of our elected officials, our servicemen in uniform, and the American consumer, then I believe, for the good of our country, If you are an American Corporation, with a corporate seal of the United States, and you are in the manufacturing business, than that plant should be housed within the 50 states of our country, “employing Americans”.

    “The future for tomorrow’s leaders, (America’s future leaders), concerning our children today, is probably the most important issue any parent, political and / or labor leader should be addressing today.”

    Did we not learn how our nation became the greatest country ever? It was thru hard work, ingenuity, innovation, and a vision…..everyone pitching in; building our nation thru the sweat of our ancestors merits. Thru the sweat of our ancestors, came a nation that future generations were supposed to thrive on.

    Instead, we are giving away our resources, technology, and most important American Ingenuity.

    What good is free trade when millions of Americans are left on the unemployment and poverty lines.

    Today we have a debt that passed the 16 trillion dollars threshold. (16 thousand billion). That number is absurd. How can a nation of so called educated leaders allow this horrific debt to incur on us and especially our children. What was the sense of building a nation, especially thru industrialization, and then allowing thousand of corporations along with its investors and shareholders to close up shop in our country, throw Americans on the street, for the sole purpose of escaping regulatory regulations, cheap labor, benefits that are associated with labor, and most important, revenue taxes.

    All this is destroying our nation. How can corporate individuals, who love this nation, live and thrive here, allow our nation to go into default. How can they expect our political leaders, our military, and especially the American consumer to support them. Free trade needs to be revamped. Again, I am not against free trade, but allowing Americans to be thrown onto the streets, so the wings of capitalism can settle on foreign land is “just not American”.

    We need Americans to stand on the sweat of their own merits. Jobs, economy, and the right to make a living should be our politicians 1st. concern.

    We need to mobilize our economy again. We do not need a tune-up. We need to overhaul our economy. We need to bring American Manufacturing and American Industry back to our nation.

    Since the signing of these free trade agreements; enacted and signed by our former legislators, the loopholes allowing American Corporation to settle on foreign land, for the sole purpose to manufacturer goods, re-directing it’s merchandize back to our home land, is not free trade. That is American Corporations selling our country out for the sake of “The Almighty Dollar”.

    What good is cheap, when millions of Americans can’t afford cheap. I truly believe the loopholes that allows thousands of American Corporations to leave our homeland because of the enacted free trade agreements need to be revamped.

    A good example are the US Olympic Uniforms being manufactured in China. For more than 45 years Ralph Lauren has built a brand that embodies the best of American quality and design rooted in the rich heritage of our country. There longstanding relationship with the United States Olympic Committee by serving as an Official Outfitter of the US Olympic and Paralympic teams should have meant that our Olympic Uniforms should have been “Made In America”. Instead, the “Greed and Pursuit” of the Almighty Dollar has led Ralph Lauren & Co. to “OUTSOURCE” the uniforms.

    In the meantime, we need to enticed American Corporations that left our homeland to come back to the United States of America.

    Our Goal should be as follows:

    A) To bring American Manufacturing / American Industry back to the United States, we need to………..,

    1) Have taxes cut domestically for American Manufactures, Industries, Corporation, “based and housed” here in the United States, including real estate taxes. This will definitely enticed corporation to move back home. There are thousands of plants across our nation that are no longer occupied, perhaps abandoned, where real estate taxes are not collected anyway.

    2) Tariffs on outsourced labor and products.

    3) Regulations streamlines.

    4) Bureaucratic clutter eliminated.

    5) Trade barriers for exports knocked down.

    6) Building trade unions recognizing “American Manufacturing as a main source of American building products for installation. Today, building trade union members are installing products from other countries for the sole purpose of keeping members working. These products are being manufacturing abroad, escaping regulatory regulations, labor laws, taxes that were to be generated here, and most important, American Jobs in “Rural America”. As a signatory member of a Union my-self, I personally believe we should be putting in American goods manufactured here made by Americans, before installing products manufactured abroad, thereby escaping revenue that would have been generated if it was “Made In America.”

    7) Install in the Presidents Cabinet a Secretary Of Industry / Manufacturing. This new post will entail a “mission”; to entice American Manufacturer Corporate Leaders to return back to the United States. His / Her “mission” will work with corporate leaders to inform them the benefits in returning American plants from overseas back to the United States. This “mission” would also entail working with political leaders in each state, working out the best possible tax breaks for these corporations that will come with bringing these jobs home. This position should not be mistaken as any job, but as a “mission” in “bringing American Manufacturing and American Industry home.”

    8) Put in place in each State of the Union a Commissioner of Industry / Manufacturing. This new post will entail a “mission”; to entice American Manufacturer Corporate Leaders to set up shop in their own state. His / Her “mission” will work with corporate leaders, political leaders as well as labor leaders to inform them the benefits in returning American plants from overseas back to their own state. This “mission” would also entail working out the best possible tax breaks for these corporations that will come with bringing these jobs home. This position should not be mistaken as any job, but as a “mission” in “bringing American Manufacturing and American Industry home.”

    I believe “If you want to sell it here………THEN MAKE IT HERE.”

    With the support of our political leaders along with labor leaders of this great nation; we look forward in your support bringing our nation together. We can continue to sit on the side lines and do nothing and hope for the best; or we can come together with a common goal; to reverse the destruction of our economy….

    The more interest we can generate to the American public will benefit our Nation’s cause for a brighter future.

    I hope we will be able to “brainstorm new and creative ideas” to further educate the public the importance and needs of bringing American Manufacturing, American Industry along with American labor back to our country.

    What this country needs (USA) is an army of workers, employees, employers, united, generating goods and services, igniting a fire of wealth, thus turning our nation into an engine of prosperity.”

    Admirers of globalization contend that free access to foreign markets and cheap labor increase corporate profits and thereby benefit the U.S. economy. While this argument may superficially sound compelling, it ignores the dangerous long-term effects of manufacturing losses. In reality, outsourcing makes Americans poorer over time, because America’s wealth and technology slowly migrate to other nations.

    If America does not manufacture and sell goods, then money only leaves the country. The U.S. now imports twice as much as it exports. This has resulted in a trade deficit that has ballooned to an unprecedented $800-850 billion on an annualized basis. Unfortunately, this trend shows no signs of abating.

    Every time an American manufacturer closes and then reopens abroad, that foreign country gains American technology. Not having to spend resources developing technology, foreigners can focus on improving or beating it.

    The importance and need of American Manufacturing is a vital part of our country’s economy. I believe it is the blood flow of any nations revenue. We are a fortunate and blessed Nation. I believe, if we start to manufacturer goods once again in this country; merchandise that we use everyday, whether it’s clothing, appliances, machinery, household goods, the clothing on our backs, the items American people uses everyday, then, I believe our Nation can put millions of Americans back to work, generating goods and services, igniting a fire of wealth, ONCE AGAIN turning our Nation into an engine of prosperity.

    The Executive branch and Congress must make “job creation” there most important task, “bringing our jobs home”, I believe our nation’s debt may be cut in half and on the ROAD to a BRIGHT FUTURE.

    I believe it’s time to get on with our country main objective; “JOBS.” Creating jobs in America should be out politicians 1st. concern, on both sides of the isle.

    After nearly 4 years of bickering, and millions of people on the unemployment and poverty line, it’s time to start building our nations economy and putting Americans back to work.

    “All that serves labor serves the nation. All that harms is treason. If a man tells you he loves America, yet hates labor, he is a liar. There is no America without labor, and to fleece one is to rob the other.”
    Abraham Lincoln

    God bless The United States of America;

    Frank J. Spotorno
    Alliance of Americans for America
    http://www.bringourjobshome.org

  6. Gary Reber says:

    Relying on his boxed-in one-factor labor value economic thinking, Robert Reich continues to espouse the “full employment” “more pay for less work” creed of Keynesian conventional economists. The Keynesian model, which is widely taught, falsely presumed that the only way to balance mass productive power with mass purchasing power is through a wage system––ignoring the possibility of democratizing future ownership of labor-displacing productive capital technologies and rising ownership incomes as a market-generated means of eliminating wage slavery, welfare slavery, debt slavery and charity slavery for the 99 percent of humanity. Kelso argued that the Keynesian model fails to recognize that “when capital workers replace labor workers as the major suppliers of goods and services, labor employment alone becomes inadequate because labor’s share of the income arising from production cannot provide the progressively better standard of living that technology is making possible. Labor produces subsistence at best. Capital can produce affluence. To enjoy affluence, all households must engage to an increasing extent in capital work [capital ownership]”

    As for unionizing workers, the labor union movement should transform to a producers’ ownership union movement and embrace and fight for this new democratic capitalism. They should play the part that they have always aspired to––that is, a better and easier life through participation in the nation’s economic growth and progress. As a result, labor unions will be able to broaden their functions, revitalize their constituency, and reverse their decline.

    Unfortunately, at the present time the movement is built on one-factor economics––the labor worker. The insufficiency of labor worker earnings to purchase increasingly capital-produced products and services gave rise to labor laws and labor unions designed to coerce higher and higher prices for the same or reduced labor input. With government assistance, unions have gradually converted productive enterprises in the private and public sectors into welfare institutions. Kelso stated: “The myth of the ‘rising productivity’ of labor is used to conceal the increasing productiveness of capital and the decreasing productiveness of labor, and to disguise income redistribution by making it seem morally acceptable.”

    Kelso argued that unions “must adopt a sound strategy that conforms to the economic facts of life. If under free-market conditions, 90 percent of the goods and services are produced by capital input, then 90 percent of the earnings of working people must flow to them as wages of their capital and the remainder as wages of their labor work…If there are in reality two ways for people to participate in production and earn income, then tomorrow’s producers’ union must take cognizance of both…The question is only whether the labor union will help lead this movement or, refusing to learn, to change, and to innovate, become irrelevant.”

    Unions are the only group of people in the whole world who can demand a real Kelso-designed ESOP, who can demand the right to participate in the expansion of their employer by asserting their constitutional preferential rights to become capital owners, be productive, and succeed. The ESOP can give employees access to credit so that they can purchase the employer’s stock, pay for it in pre-tax dollars out of the assets that underlie that stock, and after the stock is paid for earn and collect the capital worker income from it, and accumulate it in a tax haven until they retire, whereby they continue to be capital workers receiving income from their capital ownership stakes. This is a viable route to individual self-sufficiency needing significantly less or no government redistributive assistance.

    The unions should reassess their role of bargaining for more and more income for the same work or less and less work, and embrace a cooperative approach to survival, whereby they redefine “more” income for their workers in terms of the combined wages of labor and capital on the part of the workforce. They should continue to represent the workers as labor workers in all the aspects that are represented today––wages, hours, and working conditions––and, in addition, represent workers as full voting stockowners as capital ownership is built into the workforce. What is needed is leadership to define “more” as two ways to earn income.

    If we continue with the past’s unworkable trickle-down economic policies, governments will have to continue to use the coercive power of taxation to redistribute income that is made by people who earn it and give it to those who need it. This results in ever deepening massive debt on local, state, and national government levels, which leads to the citizenry becoming parasites instead of enabling people to become productive in the way that products and services are actually produced.

    When labor unions transform to producers’ ownership unions, opportunity will be created for the unions to reach out to all shareholders (stock owners) who are not adequately represented on corporate boards, and eventually all labor workers will want to join an ownership union in order to be effectively represented as an aspiring capital owner. The overall strategy should assure that the labor compensation of the union’s members does not exceed the labor costs of the employer’s competitors, and that capital earnings of its members are built up to a level that optimizes their combined labor-capital worker earnings. A producers’ ownership union would work collaboratively with management to secure financing of advanced technologies and other new capital investments and broaden ownership. This will enable American companies to become more cost-competitive in global markets and to reduce the outsourcing of jobs to workers willing or forced to take lower wages.

    Kelso stated, “Working conditions for the labor force have, of course, improved over the years. But the economic quality of life for the majority of Americans has trailed far behind the technical capabilities of the economy to produce creature comforts, and even further behind the desires of consumers to live economically better lives. The missing link is that most of those unproduced goods and services can be produced only through capital, and the people who need them have no opportunity to earn income from capital ownership.”

    Walter Reuther, President of the United Auto Workers, expressed his open-mindedness to the goal of democratic worker ownership in his 1967 testimony to the Joint Economic Committee of Congress as a strategy for saving manufacturing jobs in America from being outcompeted by Japan and eventual outsourcing to other Asian countries with far lower wage costs: “Profit sharing in the form of stock distributions to workers would help to democratize the ownership of America’s vast corporate wealth, which is today appallingly undemocratic and unhealthy.

    “If workers had definite assurance of equitable shares in the profits of the corporations that employ them, they would see less need to seek an equitable balance between their gains and soaring profits through augmented increases in basic wage rates. This would be a desirable result from the standpoint of stabilization policy because profit sharing does not increase costs. Since profits are a residual, after all costs have been met, and since their size is not determinable until after customers have paid the prices charged for the firm’s products, profit sharing [through wider share ownership] cannot be said to have any inflationary impact on costs and prices.”

    Unfortunately for democratic unionism, the United Auto Workers, American manufacturing workers, and American citizens generally, Reuther was killed in an airplane crash in 1970 before his idea was implemented. Leonard Woodcock, his successor, never followed through, nor has any other subsequent labor leader.

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