What the Ohio vote means
By Gerald W. McEntee The views expressed are his own.
The voters of Ohio sent a clear message on Tuesday. They overwhelmingly defeated Gov. John Kasich’s radical attempt to end collective bargaining for public employees in Ohio and brought an end to one of the most flagrant “bait and switch” efforts seen in recent American history.
Last November, voters in states such as Florida, Ohio, Maine, Michigan and Wisconsin elected governors and legislators who campaigned on the issue of jobs. Yet in state after state, and in the nation’s capitol as well, these newly elected politicians launched an unprecedented assault on the basic rights of working Americans. Instead of creating jobs, they sought to eliminate public sector collective bargaining, restrict the rights of citizens to vote, provide unneeded tax cuts to the wealthy, privatize vital services and promote public employee layoffs. All of these efforts were designed more to reward their Wall Street-backed campaign donors than to serve the public who had every reason to expect that the focus would be on jobs.
Ohio and Wisconsin were the breeding grounds of these anti-worker campaigns. Newly elected governors Scott Walker and John Kasich both rejected federal high-speed rail funds that cost their states tens of thousands of new jobs. Both put through unwise tax cuts for the wealthiest businesses and individuals in their states and then sought draconian cuts in services to make up the difference in lost revenue. Both signed highly restrictive voting laws, designed to keep seniors, minorities and students from participating in the political process. And both targeted public employees and the rights of workers to collectively bargain for wages, working conditions and safety on the job. They claimed these changes were needed to promote economic growth, but voters rightly saw the proposals as small-minded efforts to silence workers and reward the Wall Street backers who bankroll political campaigns.
Rather than putting people to work and revitalizing their state economies, Kasich and Walker attempted to falsely paint a picture of police, teachers, nurses and firefighters bankrupting their states with high salaries and lavish benefits. They sought to divide workers, suggesting that private sector workers were making all the sacrifices during the economic downturn. “Public employees can’t be haves, while private sector employees are have-nots,” Scott Walker told reporters. But this fiction proved hard to sell. Public employees had not caused the economy to tank, and the public has come to sense that Walker and Kasich were less interested in creating real solutions to the problems facing their states than in targeting unions for political reasons.
Governor Kasich, a former member of Congress, Fox News personality, and managing director at Lehman Brothers, pushed through massive tax giveaways in his first days in office – including an end to the inheritance tax for millionaires – and then slashed $3.1 billion in aid to Ohio’s cities and public services to make up the difference in lost revenues. In Wisconsin, Governor Scott Walker followed the same pattern, cutting taxes for the businesses and individuals at the top and then claiming cuts in public programs were necessary because of the need to balance the state’s budget.
In response, both governors inspired massive protests, the largest in the history of both states, with tens of thousands of citizens turning out to reject policies designed to reward the few at the expense of the public at large. These public demonstrations were a precursor of the Occupy Wall Street movement, as Wisconsin and Ohio working men and women took decisive action to alert the nation to the attack being made on working families and their ability to achieve the American Dream.
China hits a welcome turning point
China’s massive supply of cheap labor may at last be drying up, a development that in time will bring higher wages, inflation, a stronger yuan and help to right dangerous global imbalances.
If these trends hasten financial liberalisation they could eventually set the stage for a broader Chinese bubble. The formerly extremely unequal balance of power between workers and employers in China appears to be shifting.
Workers for a Chinese company which supplies Honda with auto parts have struck and successfully won large wage increases. Other strikes have followed, and firms have often been quick to compromise.
Hon Hai’s Foxconn, an electronics unit that supplies many leading western brands, moved to more than double many salaries as part of a series of reforms after a spate of suicides among workers at its highly regimented factories. Several regions have implemented or are debating increases to the minimum wage, a standard which didn’t even exist in China as recently as 2004.
Much of China’s economic development in the past 25 years has been built on the back, or backs if you like, of rural workers who were desperate to relocate to coastal manufacturing centers, wave upon wave of whom kept wages in check even as the economy boomed.
The one child policy and rapid development of the manufacturing base may finally be about to collide. A US Census Bureau analysis of Chinese data estimates that the number of 15-24 year olds joining the work force will fall by 29 percent over the next decade.
“Yes wages there do need to rise but when they do, watch the flood of companies relocating back to the West when wages for the lowest paid worker reach parity with the same workers in the West.”
This will never happen. At most, it will dilute the extremes. Parity? Never. It’s not just about economics. It’s about work ethics as well. And this will never change.
Migration statistics: our biggest weak spot
– Angel Gurría is Secretary-General of the Organization for Economic Cooperation and Development; Nancy Birdsall is President of the Center for Global Development. The views expressed are their own. —
All financial crises end. The question is not if we will recover, but how we can build a resilient global economy to speed and bolster that recovery. While many immediate dangers remain, now is the time to look beyond the exigencies of today.
We must take a hard look at weaknesses in the international system that might stand in our way as we rebuild. There are several, but we take this opportunity to highlight one weakness in our ability to build a resilient global economy for the future: the inadequate state of comparable data on international migration.
This is our biggest weak spot on globalization. While many countries collect and publish detailed data on who legally enters or leaves their territory, they do not do it in the same way. In consequence, it is difficult to know clearly and to compare across countries how many persons immigrate and emigrate, for how long and for what reason. Strangely, it is much easier to get a good picture of global movements of textiles and Treasury Bills than global movements of human beings. Vast disparities in income per head between countries mean that small changes in labor mobility may have large effects on the global economy. But we cannot begin to manage such changes well if the community of nations is not counting even legal migrants in the same, systematic way.
The main obstacle to good statistics is not that labor mobility is such a hot-button political issue. That would tend to raise interest in better data. Rather, the main obstacle is that statistics are a classic “public good”: the benefits are generalized, but the costs are localized. Everyone would gain from better statistics, but the individual governments that must bear the cost of compiling them have competing priorities. Result: decades of international recommendations for better and more comparable migration data have gone largely unheeded. The Organization for Economic Cooperation and Development (OECD), the United Nations, the World Bank, and many others have made great strides towards compiling better public global data, but much more is needed.
That is why, last year, the Center for Global Development in Washington convened a blue-ribbon commission to tackle this issue. It was co-chaired by Patricia Santo Tomas, a former cabinet minister of the Philippines and current chairwoman of the board at the Development Bank of the Philippines, and Lawrence Summers, a Professor at Harvard University prior to joining the Obama administration. The commission brought together a small, stellar group of some of the world’s top experts on migration data. It asked the group to name five ways to improve international migration data in the short term, within existing institutions, at the lowest cost.
The resulting report, Migration Counts: Five steps toward better international migration data, starts with the simple recommendation that every census on earth include a small number of questions relevant to migration. These include, “In what country were you born?” Answers to this simple question, asked in every country, can be a powerful tool in systematically tracking all types of international movement. The 2010-11 round of censuses is already beginning, but this basic question is still not even asked in many countries where migration is important and growing—including Japan, Mexico, Korea, the Philippines, and Egypt.
“Implementation of all of the Commission’s recommendations will require international collaboration and national support” I suspect is where this ideal will succeed or fail.
I’m not entirely convinced that the various governments around the world will collaborate and at least in the UK the government will need to rebuild it’s credibility to get national support.
I’m sure there will be lots of people who will look with suspicion for ulterior motives behind a political system that has blotted it’s copy-book and wants information on your ethnicity.
(I left the country I was born in, Australia, when I was 1.5 years old, and have lived in quite a few different countries for forty something years, so how would that fit in? My mum was born in the Argentine and has lived in many different countries, my dad was born in the UK and has lived in many different countries… although I must admit that possibly wouldn’t be the experience of the majority of the world’s citizens. I’m not too worried by say the US, UK wanting my ethnic info, but what about in say 15 years time when a different world may exist? Would I want an Adolf Hitler type leader having my ethnic info?)
>>”When a company with union labor goes out of business, you attribute this as evidence of “management failure” or “luck”.
Hear this. It doesn’t MATTER! It’s history! Management is “on the stree” and the union hall has permanantly lost ALL associated jobs FOREVER! Lose-lose! Guess who winds up alone on the stage grinning like Charlie Sheen saying “Winning” when everyone is losing?”
This is utterly bizarre. I honestly don’t know the answer to this one. Who is it that you think ends up grinning?
And yes, it does matter: you are trying to make a case against unions by claiming that “greedy” unionized employees are somehow — and for some unknown reason — driving otherwise healthy and well-run firms out of business left and right. The fact is that firms actually fail because of either mistakes their managers make (including negotiating unsustainable deals with suppliers) or circumstances beyond their control (luck – e.g., changing market conditions making them obsolete or unable to compete). Or both. I’d be astonished if you had figures showing that unionized firms failed more frequently than non-union ones (controlling for similar size, industry, etc.).
>>”An educated well paid middle class is an excellent goal for a developing country, but your point is not clear because such people are not typically union members…they are management (with the exception of government unions, which hold a special place of outrage in my mind).”
Facts are not your friends, are they?
I mean, seriously? You think the middle class is made up of either managers or government workers? Bizarre.
Historically, the US middle class was made up of large numbers of blue collar — mostly unionized — workers. People in trades or with good factory jobs. That’s in decline, obviously, but in addition to managers, the middles class still has a lot of non-management white collar workers and professionals (writers, engineers, analysts, assistants, accountants, salesmen, etc.)
And that’s true of developing countries as well, as far as I know.
Note also that:
(1) Managers are not, and should not ever be, a large enough segment of the workforce to produce anything like a broad based middle class – I mean, if your country’s workforce is running 40%, 50%, 70% management, you have serious problems (I suppose it depends on how you define it, but if you’re defining practically everyone as a manager, the distinction is meaningless).
(2) As we’ve already covered, government workers, including union represented ones, typically make less than private sector workers in comparable jobs. So to whatever extent government workers are in the middle class, it is because those government functions require high-skill workers meriting middle-class wages. If you could somehow effectively privatize some or all of those functions, average wages would, if anything, *increase*. (Note also that the extent to which unionized government workers are in the middle class is quite limited. For example, the average worker represented by AFSCME makes only about $20k/yr.)