Submitted 1 year ago by heavyladder63@lemmy.world to workreform@lemmy.world
https://lemmy.world/pictrs/image/7256a14f-249d-467a-81ff-e14e214bb07e.png
It started with Ronald Reagan going after PATCO, the air traffic controllers’ union. They had supported him in the 1980 election, one of the few Unions to do so. When they went on strike, he fired them all, and refused to rehire. The FAA was left scrambling for controllers.
Whenever you look at the death of the American dream, you see Ronnie Reagan.
Reagan signed a contract so bad that even arch-conservative Bob Hope called it a ‘give away.’ He made it possible for talent agencies to become producers, so the guy negotiating your contract was also your employer. On top of that he spied on his members for the FBI.
Interesting comparison, but I don’t think the correlation is enough here. There’s every likelihood that the reduction in union membership and the reduction in pay are both the result of some other factor.
Saying that though, unions are a good thing.
Yay, correlation ≠ causation gang!
IDK let’s see.
Other countries finally starting to pull out of the rubble of ww2.
The massive influx of the baby boomers into the workforce devaluing labor. Couple this with boomer women demanding jobs instead of being house wives, further adding to supply of available labor.
Come 1980 we add in trickle down economics which encourages the hoarding of wealth.
Then there’s computerization, automation and globalization that have been rapidly bringing up per capital productivity. Weirdly this devalues labor, because you need fewer people.
That’s just off the top of my head.
Unions are important and can be a force for good, but the data doesn’t fully support the claim.
Simple solutions to complex problems are usually being sold as a way to manipulate people… Don’t buy in to simple solutions.
It was around the 70s that the key shift likely happened. This is where productivity (I think measured in money) continued to grow while wages stagnated. So showing some time before this would be beneficial.
The chart also only plots union membership from 1973. Given the US’ history of unions, I think it would be far more interesting to go back to 1900, in particular to track membership numbers across events like the Battle of Blair Mountain 1921.
In general this graph seems to show a nice correlation but really doesn’t dig in enough to say anything meaningful.
Especially given that union memberships mirrors but lags a few years behind the fall in income share.
Was going to note that too. I suspect workers are not willing to participate in unions because unions are less able to deliver higher pay (which is a big disincentive for participation). This could be a result of changing labour laws which reduce the fundamental efficacy of unions but regardless the outcome is lower willingness to participate.
I just got my second cola this year from my union.
What the actual F? How is such a small % in a union? In my country 94% of employed 25-54 year olds are in a union.
I have literally never met anyone (aside from self-employed people) who told me or indicated to me that they weren’t in a union.
the people I work just very strongly believe union are bad. The union fees cost to much, strikes only hurt other people, we con’t unionize because people need us to do our job, you can’t unionize unskilled labor, My husband/wife works for and they hate it, What do they do for us nothing.
I don’t know how to change people minds all I know is show them facts and they don’t believe them.
There’s so many idiots that are in unions and bitch about them, but for some reason refuse to leave the union.
People are really really dumb
The union fees part is hilariously silly. Better salary from collective bargaining more than makes up for a membership fee.
40 years of propaganda
What op should do it take a country like yours and put it on the same graph. If average wage goes down for your country too then it’s highly likely not to be a union factor and instead something else.
www.tylervigen.com/spurious-correlations
It’s more likely WW2 effects, immigration and increasing competitiveness of the world.
This is why I slack the fuck off at work.
CEO have to advertise there pay publicly. This caused the huge increase in there salaries.
If you want pay to go up one of the best things the government can do is force everyone’s pay to be public.
Economics works on the assumption all information is available to make rational decisions and this will impact supply and demand.
Fix your axis.
As Kochevnik81 wrote 10 months ago:
I just wanted to speak a bit towards that website. I think that specifically what it is trying to argue (with extremely varying degrees of good arguments) is that all these social and economic changes can be traced back to the United States ending gold convertibility in 1971. I say the arguments are of extremely varying degrees because as has been pointed out here, some things like crime are trends that stretched back into the 1960s, some things like deregulation more properly start around the 1980s, and even something like inflation is complicated by the fact that it was already rising in the 1960s, and was drastically impacted by things like the 1973 and 1979 Oil Shocks.
The decision on August 15, 1971 is often referred to in this context as removing the US dollar from the gold standard, and that’s true to a certain extent, but a very specific one. It was the end of the Bretton Woods system, which had been established in 1944, with 44 countries among the Allied powers being the original participants. This system essentially created a network of fixed exchange rates between currencies, with member currencies pegged to the dollar and allowed a 1% variation from those pegs. The US dollar in turn was pegged to $35 per gold ounce. At the time the US owned something like 80% of the world’s gold reserves (today it’s a little over 25%).
The mechanics of this system meant that other countries essentially were tying their monetary policies to US monetary policy (as well as exchange rate policy obviously, which often meant that US exports were privileged over other countries’). The very long and short is that domestic US government spending plus the high costs of the Vietnam War meant that the US massively increased the supply of dollars in this fixed system, which meant that for other countries, the US dollar was overvalued compared to its fixed price in gold. Since US dollars were convertible to gold, these other countries decided to cash out, meaning that the US gold reserves decreased basically by half in the decade leading up to 1971. This just wasn’t sustainable - there were runs on the dollar as foreign exchange markets expected that eventually it would have to be devalued against gold.
This all meant that after two days of meeting with Treasury Secretary John Connally and Budget Director George Schultz (but noticeably not Secretary of State William Rogers nor Presidential Advisor Henry Kissinger), President Richard Nixon ordered a sweeping “New Economic Policy” on August 15, 1971, stating:
““We must create more and better jobs; we must stop the rise in the cost of living [note: the domestic annual inflation rate had already risen from under 2% in the early 1960s to almost 6% in the late 1960s]; we must protect the dollar from the attacks of international money speculators.””
To this effect, Nixon requested tax cuts, ordered a 90-day price and wage freeze, a 10% tariff on imports (which was to encourage US trading partners to revalue their own currencies to the favor of US exports), and a suspension on the convertibility of US dollars to gold. The impact was an international shock, but a group of G-10 countries agreed to new fixed exchange rates against a devalued dollar ($38 to the gold ounce) in the December 1971 Smithsonian Agreement. Speculators in forex markets however kept trying to push foreign currencies up to their upper limits against the dollar, and the US unilaterally devalued the dollar in February 1973 to $42 to the gold ounce. By later in the year, the major world currencies had moved to floating exchange rates, ie rates set by forex markets and not by pegs, and in October the (unrelated, but massively important) oil shock hit.
So what 1971 meant: it was the end of US dollar convertability to gold, ie the US “temporarily” suspended payments of gold to other countries that wanted to exchange their dollars for it. What it didn’t mean: it wasn’t the end of the gold standard for private US citizens, which had effectively ended in 1933 (and for good measure, the exchange of silver for US silver certificates had ended in the 1960s). It also wasn’t really the end of the pegged rates of the Bretton Woods system, which hobbled on for almost two more years. It also wasn’t the cause of inflation, which had been rising in the 1960s, and would be massively influenced by the 1970s energy crisis, which sadly needs less explaining in 2022 than it would have just a few years ago.
It also really doesn’t have much to do with social factors like rising crime rates, or female participation in the workforce. And it deceptively doesn’t really have anything to do with trends like the US trade deficit or increases in income disparity, where the changes more obviously happen around 1980.
Also, just to draw out the 1973 Oil Shock a little more - a lot of the trends around economic stagnation, price inflation, and falls in productivity really are from this, not the 1971-1973 forex devaluations, although as mentioned the strain and collapse of Bretton Woods meant that US exports were less competitive than they had been previously. But the post 1945 world economy had been predicated on being fueled by cheap oil, and this pretty much ended overnight in October 1973: even when adjusted for inflation, the price essentially immediately tripled that month, and then doubled again in 1979. The fact that the economies of the postwar industrial world had been built around this cheap oil essentially meant that without major changes, industrial economies were vastly more expensive in their output (ie, productivity massively suffered), and many of the changes to make industries competitive meant long term moves towards things like automation or relocating to countries with cheaper input costs, which hurt industrial areas in North America and Western Europe (the Eastern Bloc, with its fossil fuel subsidies to its heavy industries, avoided this until the 1990s, when it hit even faster and harder).
" I know the gold standard is not generally regarded as a good thing among mainstream economists,"
I just want to be clear here that no serious economist considers a gold standard a good thing. This is one of the few areas where there is near universal agreement among economists. The opinion of economists on the gold standard is effectively the equivalent of biologists’ opinions on intelligent design.
I’m not an economist, and definitely not a gold bug. I mostly reference that website as confirmation that something really did shift in the American economy. I don’t necessarily think it’s related to the gold standard.
I think of it more like a tipping point, the wheels of capitalism started mining the prosperity of the American citizens faster than it was being produced. The harder we’ve worked to try and catch up, the more wealth was generated to take away. Everything is pushed to the point of failure. The entire economy runs on borrowing money, so there’s no incentive to have Americans save anything ever.
Behind everything that’s causing people misery there is an industry making record profits. As time goes on the machine just seems to get more cruel and more efficient. We’re all one healthcare disaster away from losing everything.
I definitely don’t think that’s the fault of the gold standard. I blame the Cold war. At some point we decided that capitalism is defined as anything that makes money and communism is anything the government does to help people. Capitalism is always good, communism is always bad. And here we are 50 some years later.
The people living in tents exist as a warning to the workforce. Keep working for whatever you’re offered, or you will lose everything. You will lose your health care, you will lose your home, you will lose anything you have managed to save or build and be despised by society for having a moral failing. Rent keeps going up, food prices keep going up, but there’s no money in the record profit producing budget to give you a cost of living raise.
Anyway, I think the website is a good tool for demonstrating how the world no longer works to benefit people. But I blame the Cold war rather than the gold standard.
i wonder what happened in the last decade that gave western countries a much bigger and less discerning workforce to select from that enables them to dump wages ... ?
Deregulation, mostly.
The joys of mass migration.
Immigration is a very good thing for economies prepared to handle it.
now combine this with deregulation and you got a big corps wet dream utopia. guess who's not joining unions?
This is where UBI payments could come from
That huge HR team won’t support itself. /s
How much of the great decoupling is just due to big tech and the investment landscape around it?
considering this started in the 70s… no.
Big tech started before the 70s. IBM was founded in 1911. Hewlett-Packard in 1939. The 60s and 70s were when computers as a business tool (mainframes) really took off.
Also strongly correlating with advancement in technology.
not really, once you look at this over a longer time span you can see that no it does not correlate with technology, unless you think that technology basically stagnated between ww1 and the 80s
(to complete the comment above) … and that you assume the technology is also mostly stagnant in the last 2 decades, which it certainly wasn’t, especially in the computer science world. Though it could’ve got much much faster if people were paid more relative to what they produce.
While it is certainly plausible that there are diminishing productivity returns from technology, there is little evidence that paying people relative to their production increases production at all.
Most people in America don’t make things, and their productivity is an intangible concept.
what alternatives to unions exist that might be better in the modern day
alternative? you think that union membership has declined just because they were bad and not because of a concerted effort to try and destroy them?
union membership has declined just because they were bad
kind of, they can be coercive and also can be taken over and not represent what people want, and also haven’t certain laws neutralized them a bit?
I mean some alternatives that come to mind are people just switch jobs, or create businesses I guess
People could organize without it having to be a “union”, and I guess some have
uphillbothways@kbin.social 1 year ago
Remember: Workers make the machinery. Then, workers use the machinery to make more things. It may be different workers at different stages, but workers are the only means of production. Everything is produced by someone working to do so.
Join a union.
nikt@lemmy.ca 1 year ago
Keep in mind most of that machinery nowadays is made by workers elsewhere in the world, primarily in China, where the union membership rate is something like 45%.
Omniraptor@lemmy.blahaj.zone 1 year ago
If workers rights in China improve capital may simply move on to idk Mexico, India, lots of places with cheap labor and pliable governments.
BigNote@lemm.ee 1 year ago
There is no universe in which Chinese labor unions are even remotely the same thing as labor unions in the western-style industrialized democracies. China is an authoritarian top-down quasi-capitalistic system which means that there is no management for workers to negotiate with apart from a single massive structure that’s ultimately controlled by Xi’s government.
Contrast that to western-style industrialized democracies wherein unions are meant to use organized labor as a ballast against the power of privately owned industrial management.
It’s just not the same thing at all.
Furthermore, while virtually all modern machinery contains Chinese-made parts, it’s just a fact that in the western-style industrialized democracies, tradesmen vastly prefer power-tools made in places like the US or Germany or Japan because they tend to be much better in terms of quality and reliability and lifespan then are their Chinese-made counterparts.
Go to any big construction site in the US and you’ll immediately see that the workers prefer brands like Milwaukee, DeWalt, Makita, Hilti, Husqvarna and Bosch over the cheaper Chinese-made alternatives, for example.