America has now entered what has been variously called the “on-demand economy” or the “Uber economy” or the “Amazon economy.” It’s also been called the “knowledge economy,” which is Darwinian without intending to be. Well-educated workers can get ahead, but getting that good education is more expensive than ever and those without it become chum.
Labor practices in the new economy look quite a bit like those before labor got organized in the early 19th century. In too many places, exploitation is not seen as a bad thing. It takes the form of low wages, ever-shifting schedules, and like-it-or-lump-it work rules. At Amazon, as the New York Times reported last month, even for white-collar workers, labor practices are ”soulless and dystopian.” That was the description of company founder and CEO Jeff Bezos, who professed to be shocked, shocked that this sort of exploitation was taking place.
Low-wage workers, shown how to organize by the Service Employees International Union, have had some success in a few cities (including St. Louis) getting the minimum wage increased. Stung by publicity over how much their low wages cost American taxpayers in the form of subsidized benefits, Walmart and McDonald’s increased wages in a few places. But Walmart has begun cutting hours and McDonald’s is still in a kind of slow-growth funk.
The minimum wage was $1.60 in 1971, and had the same buying power that $9.43 has today. Ask somebody at a Chamber of Commerce if he could afford to pay $9.43 minimum wage, you’ll get a litany of horrors. The economy has become dependent on exploitation.
Labor has had some successes since Labor Day 2014. President Barack Obama’s Labor Department issued new rules in May that will ensure people entitled to overtime actually are paid overtime.
Last month the National Labor Relations Board ruled that Browning-Ferris Industries, a California waste management company, was a “joint employer” of people it hired through a temp agency. If the workers want to unionize, Browning-Ferris has to negotiate with them instead of claiming it’s the temp agency’s problem.
By itself, this is small potatoes. But it strikes at the heart of a gimmick in widespread use, particularly in the fast-food industry. Companies like McDonald’s sell franchises to independent business people. If you want to organize McDonald’s workers, you have to deal with hundreds of franchisees. Now McDonald’s is recognized, rightly, as co-employer if it has a “direct and immediate impact” on job rules.
And this week in San Francisco, a federal judge granted class-action status to a group of Uber drivers who want to be regarded as employees, not independent contractors. If the drivers prevail in their lawsuit, Uber would be responsible for such niceties as health insurance, workers’ compensation and work-related expenses.
Proponents of the “Uber economy,” including Uber itself, say that drivers enjoy the “flexibility” of being able to work when they want. This may well be true, particularly for drivers who are students or are supplementing incomes from another low-wage job. But the flexibility comes at a price, one that the drivers themselves pay.
What’s surprising is how acceptable this kind of wage slavery has become. Using Uber is so convenient, and has such cachet, that the social costs associated with it have been ignored. And to be sure, taxi companies left the door open to competition with poor service and slow adaptation to technology, just as corruption and an unwillingness to adapt made trade unions complicit in their own demise. Liberals are not above cashing in; Uber’s chief organizer is David Plouffe, President Obama’s former campaign manager. Amazon’s chief spokesman is Jay Carney, Mr. Obama’s former press secretary.
Indeed, in today’s economy, the virtues of collective action by organized workers barely register. The triumph of the Reagan Revolution is that “every man for himself” is rarely questioned. “Liberty” is too often conflated with selfishness.
Next year could be even rougher for labor. The Supreme Court, in a widely overlooked decision on June 30, 2014 (the same day that the Hobby Lobby contraceptive case was getting all the attention) set the stage. In Harris v. Quinn, the court ruled that Illinois home health care workers who didn’t wish to join a union had a First Amendment right not to be forced to pay “agency fees” in lieu of dues to the union.
This is the “right to work” argument cast in a different light. So-called “free riders” who get the benefits of union bargaining would be free not to join the union. It is a special cause of Justice Samuel Alito, who wants to get rid of agency fees altogether.
The court has already agreed to hear Friedrichs v. California Teachers Association, possibly as early as this fall. It is a direct challenge to the 1977 decision that allowed public workers unions to collect payments in lieu of dues. It’s hard to imagine that the justices won’t give teachers the same “opt-out” rights that they gave home health care workers.
You can blame conservative justices. You can blame immigrants or outsourcing or technology. But fundamentally, when they fail to organize and take direct political action, or even vote, American workers become their own worst enemy. Happy Labor Day.
(Excerpted from St. Louis Post Dispatch 9/3/15)