May Day worries

May 4, 2009

Today (or Friday, May 1 itself) is a bank holiday in most of Europe to celebrate May Day, a slightly more explicitly socialist version of America’s Labor Day. And it happens with unions increasingly involved in strategic business decisions around the world: the UAW is soon going to control Chrysler and have a very large stake in GM; the German autoworkers effectively have a veto over whether Fiat’s Sergio Marchionne can fulfill his ambition of creating an intercontinental automaker spanning Italy, Germany, the US, and Latin America; and the outcome of tense negotiations with its biggest union will determine whether or not Boston still has its own daily newspaper come next week.

I’m happy that the pendulum is swinging back towards labor and away from capital, after having swung far too far in the direction of the plutocrats. But the pendulum carries a poison tip: as the world sinks deeper into the worst global recession in living memory, unions are going to have to be much less antagonistic and much more helpful and strategic if they’re going to preserve the long-term sustainability of their industries.

What are the chances of that happening? It probably varies from industry to industry; when it comes to autos, it’s almost unthinkable that the UAW could manage things more disastrously than the people who have been in charge until now. But unions in general, and large, powerful unions in particular, tend to be lumbering and conservative beasts at the best of times; there’s precious little evidence these elephants can dance, either alone or in concert with the likes of Marchionne. Governments can try their best to chivvy things along, but ultimately it’s going to have to be up to the unions’ membership and leadership to recognize that radical internal change is required to turn things around. I’m not hopeful.


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