Wednesday, 16 March 2011

American trade unions under attack... Could it happen here?

Keen America-watchers among you (this certainly includes me) will have noticed the furore in Wisconsin, where the Republican Governor Scott Walker has secured the passage of a new bill to take away most of public sector unions' negotiating rights. Weeks of tens of thousands protesting in the streets of Madison had little legislative effect in the end. In future state employees will only be able to bargain collectively over below-inflation pay rises. The measure passed in committee, via a procedural dodge, while thousands of aggrieved public employees tried to storm the chamber - while Democratic State Senators hid out to try to prevent their opponents reaching a quorum. Cries of 'betrayal' rang out - for good reason.

Now Wisconsin, like most American states, faces a financial crisis and a huge black hole in its finances, especially as the Federal government's stimulus is being progressively withdrawn this year - and as anti-spending Republicans have just taken over the House of Representatives in Washington. There did need to be public sector pay restraint - and possibly even falls if jobs were to be preserved.

But this is taking a great big axe to a sapling. All of the mechanisms whereby stagnating or even lower pay can be negotiated - shorter hours, days off, flexible working, job shares - depend on negotiation in these types of jobs, which rely on the goodwill, productivity, and unpaid overtime of teachers, policmen and firefighters. So of course employers, for instance School Boards, are now scurrying to put wage and conditions deals in place while they can still negotiate with familiar faces who can deliver. Perhaps that stuff's all too 'soft' for self-appointed hard men such as Governor Walker to take on board. Compare Germany, a country that's grown much faster than the USA for the last five years (surmounting the financial crash with ease), and its greater level of social effort and activism in the workplace. Sagging American productivity? Perhaps it's the fragmented, low-cost, low-effort equilibrium of pushing people round all the time. It's an economic history argument that so-called 'new institutionalists' introduced into the British literature during the 1980s. I haven't seen much more convincing work since. Certainly the bombastic literature so prevalent at the turn of the century, condemning 'sclerotic' Europeans and praising 'flexible' Anglo-Saxons, seems to have disappeared. I wonder why?

Could the assault on collective bargaining happen here? Certainly some Conservatives would like to see ballots requiring more than half of all workers in a union - not members returning their polling card - before strikes can be launched. Even that wouldn't be as draconian as the Wisconsin experiment, but it will still be another step forward for anti-union legislation that was slightly eased during the New Labour years.

In practice, all this is rather unlikely to jump the Atlantic, at least in this Parliament. The Liberal Democrats probably wouldn't wear it, and neither would the European or British courts under the European Convention on Human Rights. A government fighting on so many fronts at once just can't take the strain of another policy war. Last night's Newsnight focus group battering of David Willetts, Minister for Higher Education and Skills showed how much middle-class and white-collar workers are hurting. They're in a mood to ally with anyone else getting trampled in the rush to the deficit altar, and Downing Street insiders can see the tough battle that faces neo-liberal 'reformers' even in union-lite America. The last thing the Government wants is another bare-knuckle fight to go alongside the universities, Child Benefit, the NHS, Disability Living Allowance, and on ad infinitum.

But yet again people who played no part in making the crisis are having to pay for it. This process is reminiscent of the 1930s, when a stock market crash, commodity price falls and consumer flight froze the world economy - only for governments to whack more taxes on investors and consumers by raising government revenue and slashing spending.

It didn't work then, and it won't work now.

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