AlterNet Special

AlterNet:
The Undeclared War on America's Middle Class

By Thom Hartmann, AlterNet
Posted on September 6, 2006

This excerpt is reprinted with permission from Screwed: The Undeclared War Against the Middle Class by Thom Hartmann; Berrett Koehler Publishers, 2006.

You can't be middle class if you earn the minimum wage in America today.

The American dream and the American reality have collided. In America we have always said that if you work hard and play by the rules, you can take care of yourself and your family. But the minimum wage is just $5.15 per hour. With a 40-hour workweek, that comes to a gross income of $9,888 per year. Nobody can support a family, own a home, buy health insurance, or retire decently on $9,888 per year!

What's more, 30 million Americans - one in four U.S. workers - make less than $9 per hour, or just $17,280 a year. That's not a living wage either.

The U.S. Census Bureau's statistics for 2004 show the official poverty rate at 12.7 percent of the population, which put the number of people officially living in poverty in the United States at 37 million. For a family of four, the poverty threshold was listed as $19,307. If the head of that family of four were a single mother working full-time for the government-mandated minimum wage, she couldn't even rise above the government's own definition of poverty.

Becoming middle class in America today is like scaling a cliff. Most middle-class Americans are clinging to the edge with their fingernails, trying not to fall. In the 1950s middle-class families could live comfortably if just one parent worked. Today more than 60 percent of mothers with children under six are in the work force. Not only do both parents work but often at least one of those parents works two or more jobs.

Middle class at 80 hours per week

In a 2005 article in the Chicago Tribune, reporters Stephen Franklin and Barbara Rose introduce us to Muyiwa Jaiyeola. Jaiyeola, who is 33 years old, works a 40-hour week as a salesman at a Sears store, then works another 20 hours in the stockroom of a Gap store in downtown Chicago. When Jaiyeola pulled two all-night shifts at his stockroom job in late August, he was able to sleep only two hours in the afternoon, then two more in the morning before going back to his sales job. He hoped to nap during his break in the middle of the night.

Jaiyeola is not hoping to get rich - he's just trying to pay his bills. Working two jobs at this wage level is what it takes to be middle class these days. And he's not alone. According to Franklin and Rose:

Nearly 7.6 million Americans straddle two or more jobs and must find time to work, sleep and live somewhat contorted lives in a very full 24 hours. According to a 2001 U.S. Labor Department survey, most workplace moonlighters do it because they want or need extra money to pay bills ...

Those who specifically need the extra work to pay bills are most often women who take care of their families, and divorced, widowed or separated workers. For a quarter of the American work force, not only is the American dream not a reality, no part of it is.

Low wages are being paid not only to entry-level workers at places like Wal-Mart and McDonald's but also to adults like Jaiyeola who have work experience. The people being forced to work two jobs to make a living are the heartbeat of our society. They are child-care workers and nursing home workers, janitors and security guards, salespeople and stockers. They often have the most hazardous jobs, the late-night jobs - the jobs that rarely include benefits.

Americans have traditionally believed in an economy where those who make a contribution are rewarded. A man like Jaiyeola should be able to work eight hours at Sears and then go home.

Low prices, low paycheck

Cons argue that we have to choose between having high wages and having low prices. They are wrong.

Take the case of Wal-Mart. According to the United Food and Commercial Workers union (UFCW), Wal-Mart could pay each employee a dollar more per hour if the company increased its prices by a half penny per dollar. For example, a $2 pair of socks would then cost $2.01. This minimal increase would add up to $1,800 annually for each employee.

I wouldn't mind paying more for a pair of socks if it meant that my fellow Americans would be able to pay for good health care. That would save me money because right now Wal-Mart's uninsured employees run up hundreds of thousands of dollars in bills at emergency treatment centers when their problems often could have been solved more cheaply and with better results had they been caught earlier at a doctor's office.

And I wouldn't mind paying one cent more for a pair of socks if it meant that parents could be home at night and on the weekends spending quality time with their kids. That's a real family value.

Here's what all this talk about wages really comes down to: Would you rather pay 10 percent more at Wal-Mart and get 30 percent more in your paycheck, or would you rather have lower prices and an even lower paycheck? That's the real choice: We're either spiraling up into a strong middle class, or we're spiraling down toward serfdom.

Looking at the arc of U.S. history, we discover we've been on a downward spiral ever since Ronald Reagan declared war on working people in 1981. Companies cut prices and then cut wages so they can still turn a hefty profit. Folks whose wages have been cut can't afford to shop at midrange stores like Macy's, so they have to buy at "low-wage" discount stores like Wal-Mart. That drives more midrange stores out of business and increases pressure on discount stores to send their prices even lower. To compensate for lower prices, they lower wages so they can still turn a hefty profit. On and on it goes - until the people working those jobs are no longer middle class and have to work two or three jobs to survive.

Our choice is not between low prices at Wal-Mart and high prices at Wal-Mart. It's between low prices at Wal-Mart with lousy paychecks and no protection for labor, and the prices Wal-Mart had when Sam Walton ran the company and nearly everything was made in the United States and people had good union jobs and decent paychecks.

The choice is ultimately about whether we want to have a middle class in this country.

Why unions?

Unless you are a CEO, you don't have a lot of leverage to demand benefits at your workplace. Every year or two, you might go to your boss and ask for a raise or an extra day of vacation, but usually you can't do much about what hours you work, what health benefits you receive, or how your retirement benefits are structured. Unions give workers that leverage.

Unions are designed to give workers a voice in decisions that affect their jobs. They allow workers to negotiate with their employers for wages, health benefits, retirement benefits, and good working conditions. In the best circumstances, unions partner with companies - both have an interest in satisfied, happy workers.

Unions create a middle class by allowing you and me to ask for the wages and the benefits we need to become or remain middle class. Unionized workers earn higher wages, have better benefits, enjoy greater job stability, and work in a safer environment. In 2003 union workers earned an average of 27 percent more than nonunionized workers. Seventy-three percent of union workers received medical benefits compared with just 51 percent of nonunion workers.

And 79 percent of union workers have pension plans. Cons have slandered unions for more than a hundred years. Professional people have bought the line that it is unprofessional to be in a union, that only blue-collar workers unionize. People worried about their status and legitimacy - like nurses - tend not to join unions.

But it's not true that unions are just for blue-collar workers. Unions are for anyone who wants to be middle class. Teachers are almost all unionized. Actors - most of whom are not Sean Penn or Charlize Theron and don't get paid big bucks - are almost all unionized. Anyone who works needs the rights that unions can provide.

Democracy in the workplace

Most of us don't think about workplace rights. We assume that because we live in America, we have all the rights we need.

There are no constitutional protections in the workplace. Most people are at-will employees, which means they can be hired or fired at will. Federal law protects you from being fired because of race, age, gender, or disability, but it doesn't protect you from being fired for saying that the boss is overworking you or the company's actions are immoral. You can't say that sort of thing in the workplace because the workplace is not a democracy.

Why does that matter?

If you can't talk freely about your working conditions, you can't negotiate changes to those conditions. If you're afraid the boss will fire you if you complain about overtime, you have no way to prevent your boss from requiring you to work extra hours.

We have a democracy in this country because the founders realized that they could not change the king of England's lousy taxation system unless they had representation in government. Democracy gives us the power to create a society that matches our needs. Democracy in the workplace allows us to negotiate the conditions of our work. It ensures that honest working people like Muyiwa Jaiyeola can be middle class without having to work 60 hours per week.

According to Thea M. Lee, assistant director of public policy for the American Federation of Labor and the Congress of Industrial Organizations (AFL-CIO), for there to be democracy in the workplace, workers must have fundamental rights. These rights include freedom of association - which means the right to organize and bargain collectively - and prohibitions on child labor, forced labor and discrimination in employment.

You may think that we have all of these rights now. We don't. U.S. workers have almost no right to organize. Every 23 minutes in the United States, a worker is either fired or harassed for trying to unionize. Our president goes around the world, talking about the importance of bringing democracy. We loved Lech Walesa and his union movement in Poland. But today, if the middle class is to survive, we need a Lech Walesa in the United States - or at least some honest education about our own country's labor history.

Labor in America

Labor goes back a long way in U.S. history. In 1874 unemployed workers were demonstrating in New York City's Tompkins Square Park. Riot police moved in and began beating men, women and children with billy clubs, leaving hundreds of casualties in their wake. The police commissioner said: "It was the most glorious sight I ever saw."

Three years later, on June 18, 1877, ten coal-mining activists were hanged. That same year a general strike in Chicago - called the Battle of the Viaduct - halted the movement of U.S. railroads across the states. Federal troops were called up, and they killed 30 workers and wounded more than a hundred. In September 1882, 30,000 workers marched in the first-ever Labor Day in New York history. In 1884 the Federation of Organized Trades and Labor Unions was established, and it passed a resolution stating that eight hours should constitute a legal day's work. Hundreds of thousands of American workers began following that rule.

In May 1, 1886, the Knights of Labor took to the streets to call for an eight-hour day. Eighty thousand workers shut down the city of Chicago. On May 4, 3,000 workers gathered in Haymarket Square. A bomb was thrown that killed seven policemen. Eight of the people present were rounded up, tried for murder, and sentenced to death. The Haymarket riot became the symbol of labor injustice in America.

This is but a fragment of the history of the labor movement in the United States.

Matters improved when labor got organized - but not much. In fact, by the 1920s things looked a lot like they do today: The robber barons were in charge, and the situation for working people was bleak. The rich were incredibly rich, and the few middle-class workers were deeply in debt. The labor movement appeared virtually dead.

It took the Republican Great Depression to wake people up. It took Franklin D. Roosevelt to speak the truth. If a politician said the same things today that Roosevelt did in the 1930s - openly accusing big business of being anti-American and antiworker - he'd be accused of socialism and communism. Very few national figures have the courage to speak out today the way FDR did back then.

Roosevelt provided courageous leadership. In his first term, he had sent to Congress the National Industrial Recovery Act, which set standards for wages and working hours and established the right of laborers to organize. This set the stage for labor groups to bargain for wages and conditions. Thanks in large part to FDR's work on behalf of labor, in the 25 years after World War II the real incomes of the middle class doubled.

Why we need a labor movement today

Today America is regressing. Middle-class income has stopped growing. The net worth of those who earn less than $150,000 per year (which includes everybody from the working poor to the highest end of the most well-off of the middle class) is down by 0.6 percent.

The problem isn't the economy. Corporations are making more money than ever. The real income of people whose net worth exceeds $100 million is doubling.

What's happening is simple: The rich are getting richer and the entire spectrum of the middle class is disappearing.

We can easily trace this decline to Reagan's first public declaration of war on the middle class when he went after the Professional Air Traffic Controllers Organization (PATCO) in 1981. He broke the back of the air-traffic controllers' union and began the practice of using the Department of Labor - traditionally the ally of workers - against organized labor and working people.

Reagan liked to say he was against "big government." What he really meant was that he was against Roosevelt's New Deal. He was against Social Security, the minimum wage, free college education (he ended that in California as its governor), and programs like the WPA. He believed in the discredited concept of "trickle-down" economics - the theory that if you create a corporatocracy, the rich will nobly spend some of their money to help the rest of us. The American people don't need handouts. Our workers just want to be paid a living wage for a fair day's work. We can't count on the corporatocracy to give us what we earn, so we need a strong labor movement to give us the power to negotiate our wages and benefits. Ultimately, it's all about power.

Workplaces are not democracies - in the United States they're run more like kingdoms. Employers have the power to hire and fire, to raise or lower wages, to change working conditions and job responsibilities, and to change hours and times and places. Workers have only the power to work or to not work (known as a strike). The strike - a tool that can effectively be used only by organized labor - is the only means by which workers can address the extreme imbalance of power in the workplace. And because organized labor is a democracy - leadership is elected and strike decisions and contracts are voted on - unions bring more democracy to America. We spend about half our waking lives at work - at least we can have some democracy in the workplace, and a democracy means a strong middle class. ...

To-do list

The cons have almost succeeded in throttling American democracy by screwing over the middle class. To fight back we must battle on two fronts.

First, we must recognize and reclaim the government programs that create a middle class:

* Return to the American people our ownership of the military, the prison system, and the ballot box.
* Fight for free and public education that encourages critical thinking, historical knowledge, and a love of learning in each child. Combat the No Child Left Behind Act and the belief that education is a commodity that can be tested.
* Fight for a national single-payer health-care system based on Medicare.
* Fight for Social Security - do not let it be privatized or co-opted.
* Fight for progressive taxation: reinstate a rate of 35 percent on corporations and a rate of 70 percent on the wealthiest 5 percent of Americans - and use the money to pay back the Social Security system and to fund an economic investment program.
* Fight for a living wage and for the right of labor to organize.
* Fight for a national energy program that puts people and the planet - not Big Oil - first.

When America has a strong middle class, democracy will follow. The opposite is also true. To fight back, we must also make use of the ballot box. We can achieve the economic programs that make the middle class possible by using the power of our democracy to vote for those politicians who support the middle class. We've been conned for long enough. It's time to take back America.

Thom Hartmann is an author and nationally syndicated daily talk show host.

© 2006 Independent Media Institute. All rights reserved.
View this story online at:
http://www.alternet.org/story/41192/

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The Slow Death of the Middle Class

By Laura Barcella, AlterNet
Posted on September 6, 2006

In his new book, Screwed: The Undeclared War Against the Middle Class, Air America host Thom Hartmann provides an exhaustive argument that America's backbone and lifeblood - its middle class - is vanishing. (Or being cast out, set aside, and methodically destroyed, depending on your perspective.)

Hartmann blends current affairs with a vital crash course in history to demonstrate the ways in which - under 25 years of right-wing wonkery - working people, once treasured as the foundation of our economy, are now neglected to the point of extinction. Through concrete examples of laws passed, unions busted and programs dismantled, Hartmann reminds us how, since Reagan's 1980 ascension to the throne, conservative policiticans have done little except "conserve" their own wealth- and power-grubbing interests.

But it wasn't always like this, as Hartmann makes sure we remember. With the creation of post-Depression initiatives which benefited everyone, such as Social Security, antitrust laws and the minimum wage, America's most forward-thinking politicians helped revitalize the economy and make the country a more unified whole.

Why can't it be like that again? In an AlterNet telephone interview, Hartmann explains that it can - but that it will only happen when more Americans get out and elect the few politicians who actually give a damn about the rest of us.

Laura Barcella: What are the three biggest hurdles currently affecting the middle class?

Thom Hartmann: Free market ideology; a variety of practices to drive down the cost of labor - from destruction of the union movement to encouragement of immigration, both legal and illegal; and the promotion of the idea that democratic institutions are an aberration, that vast wealth is the natural order of things in the human and animal kingdoms.

LB: In Screwed, you write about the "Golden Age" of the middle class. Can you remind us of what a healthy middle class looks like?

TH: Teddy Roosevelt was the first in the modern era to identify what it would mean to [have a] middle class in a society that wasn't propped up by slavery and land taken from the Native Americans (which was largely responsible for the first middle class, in the 1700s).

The Republican Roosevelt realized that without government intervention clearly defining the rules of [business] to serve society as well as capitalism, there couldn't be a middle class.

[Roosevelt] suggested that the hallmarks of a "living wage" (he was the first person to use that phrase), were that with an honest week's work, a single family's wage-earner would be able to support their family, raise their children, provide education for those children - including college, care for all their health needs - even in times of sickness (quoting Roosevelt), take an annual vacation, and set enough aside that retirement and old age would be comfortable and secure.

Franklin Roosevelt set about putting that vision into place 30 years later with the Wagner Act in 1935, which established the right to unionization, and the Social Security Act providing a safety net for old age (and for people incapable of working due to 'circumstances of birth'). ... All of this led to the strongest middle class this nation has ever seen, in the '50s, '60s, '70s and the beginning of the '80s.

LB: And then what happened?

TH: Then in the 1960s and '70s, a group of worried ideologues saw the social upheavals of that era - women demanding equal pay and reproductive rights, African-Americans demanding voting rights, working people demanding [fair wages], activists demanding a clean environment - and the ideologues thought what they were seeing were symptoms of society melting down.

It confirmed their fear, which echoed a fear of the early founders (John Adams and Alexander Hamilton), that too much democracy would lead to social anarchy. A ruling elite operating under the guise of democracy was the most stable form of government, and if we had a strong middle class like we had in the '60s and '70s, people had too much time on their hands and too little fear. ...

These folks (who comprised Ayn Rand's objectivists, libertarianists, and old-line segregationist conservatives who agreed with Edmund Burke that in order to be stable, society must have "classes and orders") set out to restore a more hierarchical, more "stable" America. They didn't believe in democracy; they thought they were doing the right thing. ...

Special interest groups, like the NRA, joined forces to roll back the healthy middle class and the dissent associated with it, and replaced it with a Dickensian reproduction of Victorian-era society, where there's a small powerful ruling class, a small mercantilist middle class, and a large class of working poor who are sufficiently afraid of losing what little they have that they aren't going to engage in social or workplace protest.

LB: So when, in your opinion, did the middle class officially begin to start falling apart?

TH: Nixon's Southern Strategy brought the racists into the fold in 1972, and George Bush's courting of the Christian right brought the fundamentalists into the fold.

But Ronald Reagan officially launched the [war on working people]. He kicked it off with busting PATCO. We are now 26 years into that war, and papers no longer have labor sections - they only have business sections, and most workers no longer have pensions.

We've gone from 25 percent of the work force being unionized - when Reagan came into office - to about eight percent of the private work force being unionized. The small sliver that's still unionized is under aggressive attack, and they represent the last bastion of the classic middle class.

The conservatives can't allow them to survive; [unions] bring democracy into the workplace, so they represent a threat to conservative wealth and power. ... The only thing that will allow unionization to happen is force of law; to elect public officials who are willing to enforce the Wagner Act and repeal the Taft-Hartley Act of 1947. This requires [politicians] who represent the will and needs of the middle class, instead of the wealthy, powerful gentry.

LB: Who are a few of the politicians you feel are up to this task?

TH: Bernie Sanders. Byron Dorgan. Peter DeFazio. There's not a shortage of good people in politics; they are just not a majority.These aren't radical positions, they are ones that Eisenhower held. And there are good, honest Republicans like Kevin Phillips and Paul Craig Roberts out there, pointing out [the ways the GOP has been corrupted], but their voices are a distinct minority.

LB: Talk a little about George W. Bush, and how his politics and presidency have affected the plight of the middle class.

TH: G.W. Bush is the most toxic president we've had against working people in the U.S. since [William] McKinley. Bush absolutely believes in a ruling elite - into which he was born, by the way - and serfdom. It wasn't a slip at that Town Hall meeting a few months ago, when he asked a woman what she did and she said she worked three jobs, and he patted her on the head and said, "Isn't that great? That's an all-American story."

Her working three jobs means she won't be out in the street demanding economic, reproductive or social rights - which is exactly the way he would like it.

LB: And what about the war's effect on working people?

TH: The war in Iraq's impact on the middle class has been extremely corrosive. I wouldn't [even] call it a "war;" I'd call it a successful invasion that took only a few months, and the subsequent occupation. All illegal, by the way.

The occupation of Iraq has been financed by borrowing money in our names - and in the names of our children and grandchildren - from China, Saudi Arabia, Japan, and a few very wealthy families, like the Bushes. Those creditors will be beneficiaries of the war, and the middle class will pay the bill eventually, just like the economic difficulties Jimmy Carter suffered after the bill was due for Vietnam. The next generation will have to confront some very difficult times as a result of Bush's $9 trillion debt.

This year, over $300 billion of the federal budget is interest on a debt that Reagan ran up in order to make the economy look good, on borrowed money, to get himself reelected. That's enough money to provide full scholarships to public universities for over 15 million students.

LB: Talk a bit about the impact of the minimum wage.

TH: The minimum wage can be thought of in two ways. One, it provides a floor for workers, and should be set at a level matching Teddy Roosevelt's' criteria which we discussed earlier. We are a wealthy-enough country that if you play by the rules and work hard, you should be able to have a decent life.

The other thing the minimum wage does is provides a warning flag [about] the fiscal health of working Americans. In that regard, the fact that the minimum wage is the lowest it's been since the1940s, when the middle class was just emerging, tells us that conservatives have been successful in producing a large, terrified class of working poor, who can be easily manipulated and who don't have enough time to be politically active.

LB: What can people do to help stop the death of the middle class?

TH: The thing so few people get about why the middle class is vanishing is that it's not just [driven by] greedy industrialists. It's not just about money. In fact, it's not even half about money. It's about power. It's about reestablishing the world Dickens described in "A Christmas Carol," where Bob Cratchit had to beg for a lump of coal and health care for his child. Conservatives look at that time in that world and they see a time that was comfortable, stable and predictable. Those are higher values, to them, than freedom and egalitarianism and social justice.

When America gets it that these are ideological issues - not just economic - then it will translate into the political realm, and something might be done about it.

LB: But how can more Americans "get it"?

TH: In my book, I reproduce a 1936 speech by Franklin Roosevelt about this issue - how royalists were trying to seize control, how allegiance to democracy requires the overthrow of such corporate power.

Ever since the '80s, since Reagan conservatives started [insisting] that communism was being taught in school civics classes, we have had a generation of people who came of age in the '90s who have no recollection of what was conventional wisdom in 1936: that there is an economic and class war going on. As Warren Buffet said, "Of course there's a class war, and my class is winning."

We need to reawaken people under 30 and 40, to remember what the ideals of this country traditionally have been, and how healthy that is for the world - not just the U.S. [We need to] keep telling stories of how it was in the old days. The conservatives are doing everything they can to strip American history.

Laura Barcella is an associate editor at AlterNet.

© 2006 Independent Media Institute. All rights reserved.
View this story online at:
http://www.alternet.org/story/41305/