The first platform committee meeting for the 2016 Democratic National Convention, featuring representatives from both campaigns as well as DNC neutrals, took place on Wednesday. Their deliberations will likely feature tough negotiations on a range of issues — a $15 minimum wage, fracking, the legitimacy of giant banks — that were points of contention during the campaigning, helping clarify the political and ideological shift that has taken place in the party since the mid-1990s when Robert Rubin was its intellectual lodestar.
One proposal that fits the stated agendas of both candidates is the call for a “model employer” executive order — a move the next president (or, indeed, the current one) could take to promote the kind of higher-wage, union-friendly economy that both Hillary Clinton and Bernie Sanders say they want.
The model employer executive order, explained
The union-funded organization Good Jobs Nation developed the proposal, which has two key planks:
- Preference in federal contracts and some subsidies to “model employers” who pay at least $15 per hour and meet a standard package of benefits, including health insurance and sick leave, and provide stable, full-time hours.
- Contractors would have to affirm, rather than impede, the right of their employees to unionize in return for a no-strike or “labor peace” pledge by the employees.
The liberal think tank Demos calculated in 2013 that there are at least 2 million low-wage workers earning less than $12 an hour who work for companies that benefit from federal contracts.
These workers range from home health care aides whose jobs derive from Medicare and Medicaid to janitors in the federal buildings, such as the US Capitol. The hope is that the federal government would use its leverage to promote union organizing and construct a model of labor management relations for the rest of the private sector. The basic idea has gathered considerable steam at the municipal level, where 120 localities have already issued similar orders — but the federal government’s reach is clearly much further.
Public policy profoundly shapes labor markets
Today we take for granted that federal law promotes nondiscrimination norms in the workplace in matters of race and gender, while an active political debate is ongoing about extending this principle to LGBTQ and transgender Americans.
At past moments in history, the state similarly put its weight firmly behind the promotion of labor unions as a means of structuring labor markets.
The National Labor Relations Act, held constitutional in 1937, was, as its critics charged and its supporters hoped, not a neutral law. It explicitly encouraged unionization as a method of protecting the living standards of working people and thus stimulate the larger economy; defend their First Amendment right to free association; and protect, as its preamble said, “the free flow of commerce” by limiting strikes and other industrial actions by workers seeking the very right to organize that the law enshrined.
Federal courts and the National Labor Relations Board (NLRB), for several years thereafter endorsed these goals. As early as 1940, for example, in connection with American support of the British war effort, the government sought to limit federal contracts to companies that abided by federal labor law.
Then in 1942, facing the imperative to fight fascism on a worldwide scale, Franklin Roosevelt issued an executive order that consolidated the gains of the labor movement: It established the War Labor Board, which effectively compelled companies to recognize and negotiate with unions in return for a promise not to strike by unions. Each side sometimes broke the pledge, but the order succeeded in buttressing the extraordinary economic dynamism behind the war effort and established the macroeconomic conditions that carried forward into the postwar years.
The fate of unions depends on politics
But while the economic legacy of wartime pro-union efforts persisted for decades, thepolitics that shaped those policies collapsed almost immediately due to the United States’ uniquely union-hostile business community. Unions themselves, fearful of government intrusion, have often preferred a voluntary relationship between labor and management. But in the United States labor must, to some extent, rely upon the state to ensure the rights of workers to organize and collectively bargain.
As the historian Nelson Lichtenstein writes, “In every other capitalist nation, a strong bureaucratic state either preceded or simultaneously emerged with the multi-division firm, but this pattern was reversed in the United States.”
In other words, in America, big business — complete with a “desperate sense of individual autonomy” among owners and managers — precedes the existence of big government, leading those owners and managers to fiercely resist unionization during the New Deal era and afterward.
Moreover, the fragmentation of the business sector across a heterogeneous, continental-size nation favored decentralized economic development rather than the cooperative triad of business, labor, and government that emerged in much of Western Europe. The more disaggregated capitalist production was in the United States, the more essential it was for each firm to sustain flexible labor costs and to fight union efforts to standardize those costs across industries.
Consequently, there is absolutely no consensus in the United States in favor of the shared legitimacy of business and unions. One result is that federal labor policy oscillates wildly depending on which party controls appointments to the NLRB.
Given these structural and historical circumstances, only a national political party sympathetic to unions is able to give them a fighting chance. Given their tenuous, always contested position in the American political economy, absent the active support of the federal government for unions, they wither. And when unions wither, wage inequality rises, and civil society is impoverished as well.
Unions could be the key to working-class woes
American political culture is currently immersed in a debate about the white working class — its economic decline, its lowered life expectancy, its increased suicide rates, its increased levels of drug and alcohol abuse, and its cultural and racial resentments. The varied anxieties of white Americans without a college degree have made Donald Trump the nominee of a major political party, even as the objective economic circumstances of working class African Americans and Latinos look even worse.
Unlike any other public policy or institution, unions address this entire range of concerns. They ensure wage gains that match overall productivity growth, integrate members into a supportive social ecology essential to civil society, and, crucially, connect workers across ethnic and racial lines in a common project of collective improvement. This act of working together, within institutions supported by the dues payments of all of its members, regardless of race, gender, or ethnicity, mitigates cultural fear and, sometimes, even racism and other bigotries.
So far, the proposed model employer order hasn’t gained enough visibility to attract formal criticism from the business community or the conservative movement. But as in the case of other federal requirements, they will presumably lament “endless red tape” and claim that most businesses with federal contracts are good employers and that the government shouldn’t burden them.
Provisional evidence suggests, however, that such a program might either increase contracting costs only nominally or possibly even reduce them. A 2010 report by the Center for American Progress asserted that state examples of the policy “increased contracting costs only modestly, if at all” by, for example, in Maryland encouraging many more bids from contractors attracted to an even playing field.
A 2013 report by the National Employment Law Project further argues that hidden costs of a low-wage, contracting workforce that taxpayers currently bear — reliance on public benefits and workforce instability, which leads to high retraining costs and higher absenteeism — actually reduces costs in many local and state model contracting programs.
A 2014 report from Demos suggests that, depending on the number of workers covered, reducing costs of programs like the earned income tax credit, SNAP, and Medicaid could save several billion dollars while increasing the tax revenues the government takes in from the higher wages that would be paid to workers.
Clinton and Sanders have a fair amount to disagree over, but in principle they ought to be able to unite on this. Sanders spent the entire campaign arguing he was fighting for the working class, and he walked the picket line in support of striking Verizon workers. And Clinton, the “establishment” candidate, has claimed vociferously that she supports unions, and of the two she was the one who put a labor official on her platform delegation — Paul Booth, the executive assistant to the president of AFSCME.
Over the course of the campaign, in part due to pressure from Sanders, Clinton has positioned herself substantially to the left of where her husband’s administration ended 16 years ago. Along with Occupy, Fight for $15, and Black Lives Matter, Sanders’s campaign has helped to transform the Democratic Party. But it’s been difficult for either candidate to identify concrete means by which to advance their economic and political goals in the face of what’s likely to be a Republican Congress. A model employer executive order could do the trick.
As Hillary Clinton might say, someday, about her tenure in the White House: To rejuvenate civil society, it takes a state — or, at least, a president.
Rich Yeselson is writer living in Washington, DC. He worked in the labor movement for 24 years.