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- [00:10]
A
Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives. Jobs, incomes, debts, ours, our children's. I'm your host, Richard Wolff. I want to begin today's program with a comment that many of you have asked me to make about the economic team that has now been announced by President Elect Biden. And I'm going to comment honestly because that's the purpose of the program. This is best described as the same old, same old. Some of the people named are literally the people held over from Obama or previous administrations, such as Janet Yellen, the new designated Secretary of the Treasury. Others were in the Obama administration or come from the same circles with the same perspectives. They seem to believe that a return to the pre Trump normal is a reasonable objective for what they plan to do. I don't see or hear of any dramatic plans for changing the inequality that afflicts this country, for changing the business cycle instability that afflicts this country. I don't see any of it and I don't hear it. And these people have no history of doing anything like that or even speaking about it in anything other than the usual liberal tones of concern. So what am I saying? I'm saying to you that this is an economic team that probably will reconstruct what existed before Trump. And what is that? Neoliberal government, minimum intervention, Globalization. Telling the American people that helping corporations is the best way to help everybody else. You know, you're familiar with it. It's what happened under Clinton, it's what happened under Obama. It is the same old, same old. But here's the problem. It was exactly neoliberal economics, laissez faire, let the private sector govern globalization. All those things led to the creation of the base and movement that brought Mr. Trump to power. And here's my honest opinion. If you do with this team what it looks like you're doing, you're recreating the conditions that produced Mr. Trump, only you have a grave risk that the next Mr. Trump or whoever replicates what he did will be less crude, less gross, less offensive, and thereby all the more effective than Mr. Trump was able to be. Could I be wrong? Of course. Is it possible that somehow, after the 20th of January, once these people are in power, they will change and become in a willing and able to make the economic changes that the depth of our current crisis requires? It's possible, but I don't expect it. Why not? Because the comparison with the 1930s, when that happened, has a fundamental flaw. What existed in the 1930s that made the government step up after Franklin Roosevelt was elected so that he would become much more progressive than he had ever been before. Was a movement from below. The greatest unionizing drive in the history of America. The cio. Very strong socialist parties, two of them, and a Communist party all working together, mobilizing millions of working class Americans. They made that happen. I don't see Mr. Biden's team of moderatesand I'm being polite doing anything comparable. Nor Mr. Biden, given his history, because there isn't yet that kind of pressure from below. If that were to emerge, if the Bernies and the Ocasio Cortez's and the DSA and the labor movement, et cetera, et cetera, et cetera, if they got together, if they mobilized, then who knows. But other than that, no. This team is a remarkable failure to come to grips with, to even admit how serious the crisis and the divisions of this country are. My next update has to do with an overlooked document. The National Bureau of Economic Research, one of the most respected economic think tanks in the country, issued a paper in November of 2020 authored by a well respected bank specialist, Lawrence Ball. For those of you who might look beyond it. This paper looked at whether or not the biggest banks in America were adequately covered with capital, could handle a crisis. And he looked at the six largest US Banks in terms of the stress tests that they are subjected to and that have been reported. If I had more time, I'd go through his paper. But I want to just present you with a conclusion based on his research covering the fourth quarter of 2019. The tests he thinks would have to be maybe now under current conditions, to see if the banks could handle a crisis. Suggest, and I'm now quoting from the abstract of that paper, it is unlikely. I'm quoting. It is unlikely that any of the six biggest banks in America would survive a liquidity crisis for 30 days. This negative finding is most clear cut for Goldman Sachs and Morgan Stanley. Those are the two biggest banks in the country. They couldn't survive for 30 days if we had a crisis of the dimensions we have now. That was a finding last month. When you are told that our government has its financial house in order. Please keep this in mind. My next update. I want to take my hat off to the people of India and I want to tell you about what happened on November 26 in India. Because the coverage in the mainstream media of the United States was somewhere between laughable and abominable. 250 million people went on a general strike. That's three quarters of the American population 250 million. They mobilized 250 million farmers and workers together. Many farmers organizations, many labor union federations. The only union federation that didn't participate was the one allied to the Modi government. And that's not a surprise because the Modi government was the target of the general strike. Wow. The government has been using, said the strikers, the COVID catastrophe which they have mismanaged. India is ravaged by Covid as an excuse to attack labor protection, labor regulations and and labor rights. So they made a demonstration against all of this. Protesting the Indian economic catastrophe, the Indian COVID 19 catastrophe and a government not responding to those catastrophes, but in fact attacking. And of course they were furious at the effort of the Modi government to deflect upset by having war with China on the border and particularly demonizing. Yeah you guessed it, Muslims. Again, convenient scapegoat. What did the protesters want? Here's the interesting thing. I want to read to you some of the demands of this general strike which was stunningly a direct cash transfer of 7,500 rupees to every family below the poverty income. Cut off 10 kg free food ration per person every month to all in need. Wow. Expansion of the Rural Employment Guarantee act to provide jobs from the current 100 days to 200 days in both rural and urban areas. Withdrawal of all anti worker labor code changes and likewise anti farmer laws. Stop privatization of public sector corporations. Withdraw the draconian forced premature retirement of government and public service employees and provide a pension to all restoring earlier pension cuts.
- [10:19]
B
Wow.
- [10:21]
A
Across the board transformation focused on the mass of the Indian people. I bring it to your attention basically to ask one question with you. Why has nothing like that been done here? Why is our labor movement, afl, CIO and others not demanding jobs for the unemployed? Ending of anti labor and anti farmer regulations. Use of the COVID disaster as a cover for doing damage to existing labor laws. We have more unemployment than any other advanced country in the world as our way of dealing with the crisis. And yet our labor movement does not stand up and say and it would get the support of the American people. We don't want millions of our fellow workers to be unemployed. That's not an acceptable way to handle a health crisis and and a capitalist crash. Who would oppose a protest march making that point? Where is the comparable energy, imagination and focus? Look what the people of India have been able to achieve. My last update I call how capitalism handles a crisis of Capitalism. The New York Times on 2 December carried the reports of a study, a study made by the Small Business Administration in Washington, the administration that focuses government support for small businesses. And what the SBA Small Business Administration did was to study the more than 5.2 million companies that received loans from the Paycheck Protection Program. This is the first full accounting of who got that money. And by the way, hefty chunk, $523 billion were distributed already by the Paycheck Protection Program. Here's what the SBA found. More than 25% of that $523 billion, that is more than a quarter of the money went to 1% of the borrowers. That's right, big business screwed medium and small business out of the help designed for medium and small businesses. That's how capitalism usually works. And what I want you to understand is it extends to when the government is trying to help a society beset by an economic crash and a public health failure of gargantuan proportions. It never stops the unfairness, the inequality and the injustice. Capitalism is the sickness that needs a cure. We've come to the end of the first part of today's show. Before we proceed, our new book, the Sicknesses the When Capitalism Fails to Save Us From Pandemics or Itself, is now out and available@democracyatwork.info books. I want to thank our Patreon community for their invaluable support. And if you haven't Already, go to patreon.com economicupdate.com Please sign up and you will get access to exclusive content and more. Please stay with us. We'll be right back with our special guest, Sarah Nelson. Welcome back, friends, to the second half of today's Economic update. I am proud and pleased to welcome to our microphones and our camera Sarah Nelson, the international president of the association of Flight Attendants, CWA and AFL cio. Sarah Nelson is that president, as I've said, and she played a key role in helping to end the government shutdown in 2019 and to secure federal payroll grants to keep aviation workers employed and connected to healthcare workers during the coronavirus pandemic, while also making sure that they did not engage in stock buybacks and also in capping executive compensation. She began this phase of her life as a union flight attendant at United Airlines in 1996. Sarah, welcome very much to Economic Update.
- [15:41]
B
Thank you. I'm happy to be here.
- [15:43]
A
All right, let's jump right in. Your name, for better or worse, has been associated with the notion of using the labor strategy of a general strike, something that we a couple of weeks ago saw used in India when they were able to mobilize 250 million people in a general strike to confront the Modi government there. Modi government having been characterized often in India as Trump or light. But in any case, I want to know what you think about the use of that particular weapon of the labor movement both in the past and whether you can imagine uses for it with the new administration.
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B
Well, look, let's be really clear. In this country and around the world, we have shied away from saying the word strike. And if we could just get back to a place of actually saying the word strike, embracing that, embracing the fact that this is labor's power, this is working people's power to change our workplaces, to change the political dynamic. It all comes down to defining the problem, defining the urgency around fixing it. So that's making clear our demands, and then defining what we're willing to do to fix it. So we've got to be able to talk about a general strike at any time, but frankly, we've got to be able to talk about a strike in the workplace. You have to have people thinking about labor's power. Too often, we outsource our power to relationships, to thinking of unions as HR solutions, as opposed to who unions really are. And that's the working people who make up the union. Where does our power come from? If you're not talking about the strike, if you're not talking about the willingness to withhold your labor when things are not going right for working people, then we're not really accomplishing what we need to for working people. So I think it's bigger than just a general strike. People have not been using the word strike at all. People have not been talking about labor's power. And, you know, in recent years, we have seen real solutions take place when working people rise up together. Take the West Virginia teachers strike, for example. All 55 counties striking together. And when the teachers were deciding whether or not to strike, the bus drivers said to them, well, you guys decide what you want to. Those buses will not be driving to the school. That's the idea of solidarity. And what happened in that strike was not only did the teachers have better contracts for themselves, but they raised the standards for all public employees. So this is about getting results. And we can get results as working people very, very quickly if we understand where our power comes from. So we've got to be able to talk about the strike as the means to get to a resolution in collective bargaining and to wrap our arms around the idea that collective bargaining is really the way to get the best solutions, because you bring every voice to the table and you don't allow capital to just run away with all the ideas, all the cash, all the control.
- [19:01]
A
All right, wonderful. Thank you for the clarity of what you've just said. Let me jump to the other side of this same basic coin, the labor movement, I think it's fair to say, and please correct me if you disagree, but the labor movement has been remarkably quiet over the last four years of Mr. Trump's administration, and particularly over the last nine months of this combination of public health catastrophe and a crash of our economic system happening together and worsening one another. Why is that? Why has the labor movement been, if you agree with that assessment, why has it been relatively quiet?
- [19:46]
B
So I don't agree with it in aviation. And in aviation, we're 80% unionized, and we are at the table in everything, in every aspect of safety and health. In aviation, we don't always get exactly what we want, but we're integrated into that, both in terms of how we're working with our airlines. We have contracts that require the airlines to have to work with us on these things. And also in terms of federal regulation, we're at the table. We're at the table because we have that kind of political power. And we have made real changes. We got relaxed sick leave policies. We got covered pay for quarantine. We got certain rules, like people having to wear masks in our workplaces and enforcement around that even when the government wasn't acting. We've been able to also step up and call out the government on not taking action here and speak up. The main thing that we did, though, was when coronavirus came crashing down and you have public health colliding with the economic catastrophe that came with it, we said we are not going to approach this moment in time as though labor has a list of priorities on the side that we're hoping can be included in any sort of relief Bill. No, no, no. If there's going to be relief for the airline industry, we know what it's like. We know what crisis looks like when capital takes control. We've been through the bankruptcies. We know what it's like when they turn the tables and they use this opportunity to squeeze us like we've never been squeezed before. We lost our pensions. We lost 30 to 40% of our pay. We lost a lot of. They gained a lot of our productivity. So that in order to run the airlines, just like any other industry today, if they don't have those overtime hours they can't make it work. So workers are working more to make more rather than getting a fair pay for a full time job. And so when coronavirus hit immediately, what happened was aviation workers and many other workers, workers took a hit right away because our hours were dropped. We no longer had access to those overtime hours. And so we took a hit and pay right away. But we said, if we're going to have relief here for the airline industry, it has to be focused on the workers. And so we went to Congress with a plan. Luckily, we have a chairman of the Transportation and Infrastructure Committee who was the committee of jurisdiction over relief for the airline industry, Peter DeFazio. And he said to the airlines, I'm not going to talk to you until you talk to labor. And so we had our negotiations outside of the legislative process, and we said to the airlines, the public doesn't like you. You've squeezed us, you've squeezed them, and you have no goodwill. And so you're going to have to come to our plan if there's going to be any relief. And we got them to agree that the relief from the government would go in the form of a payroll support. It could only be spent on workers pay and benefits. And in addition, they were going to have to agree to cap their pay for two years even after the relief expires, and ban stock buybacks and dividends for a year after the relief expires, so it couldn't be funneled in that way. And then they would have to agree to no cuts in hourly rates, continued jobs for everyone, keeping us connected to our healthcare and continued service to all of our communities. So there's a jobs and infrastructure plan. And that was the trunk of the relief. We built that relief from the ground up for the workers. And it was the first ever in the United States history that it was actually a workers first relief plan, not a corporate bailout. And so we had that power to be able to do that. In terms of your question, back to your full question, though, about the Trump administration, don't forget that when in the first few days with the Muslim ban that was in our workplace, and we pushed back on that. We were a part of pushing back. At the same time those court cases were happening, when the family separations happened, it was flight attendants who stood up and said, we're not going to work those flights. And within 48 hours, we had them backing off of that. When coronavirus happened and they wanted to put people on our commercial jets who were coming from the cruise lines where there had been Infections on coronavirus. We said we weren't going to work those flights either, and we got to change CDC policy within 36 hours, and we kept them off our flights. So where you have workers organized in their workplace and can push back and actually push back on capital. And let me give you one more example. LGBTQ rights. We negotiated some of those rights in our contracts before they were in any city ordinance, before they were in any state law, before there was any decision from the Supreme Court. And. And what we did was we negotiated in the United Airlines contract domestic partner benefits. And then we testified in San Francisco, and we got the first city ordinance for domestic partner benefits. And guess who we brought with us? We brought United Airlines to the table on that, arguing that other businesses should have to comply with this, too, because now, all of a sudden, they didn't want to have to compete on an uneven scale. So when workers organize in their workplace, have clear demands, and get those contract improvements, that's about improving public policy. And social issues are tied up directly with economic issues. That's a prime example. There are examples all through the Trump presidency where aviation workers pushed back, where aviation workers made things better, where aviation workers took a stand on what looked like social issues for everyone, but were in our workplace. And we had a way to push back. It was aviation workers who ended the government shutdown because we defined what was at stake for us and for the whole public and what we were willing to do about it. And think about that. A few flights started to stop in LaGuardia, and all of the sudden, Capitol Hill had a deal after 35 days of not having one, and the day before, voting against the solution that they voted for that day to approve, when a few flights just started to stop because we had explained that we were willing to stop the whole system. They didn't want us to get a taste of our power as workers. And that's why that deal came together faster than anything you've seen before. Because if that had gone on much longer and the public had had an opportunity to really take in and understand the power that working people had in putting our hands in our pockets, the whole thing would have been over. And they know that. So I want to push back a little bit on labor being quiet here. Where we have made advances, it has been when labor has stood up, and we've got to do a lot more of that. And it shows the potential of what the labor movement could be, and it shows the potential of what we can do now on a different playing field. Because let's Face it, Biden's rhetoric around labor unions is some of the best that we've heard in 100 years. But if we're not organized and working to make the most out of it, we're not going to get anything out of this. No politician is going to do this for us. We have to be organized, clear about our demands and work in solidarity to get it done.
- [26:46]
A
All right, let me push back just at you a tiny bit. Do you see this kind of attitude that you've just articulated very clearly? Is this spreading in the labor movement? Are other unions picking up this attitude, this view? Do you see that happening in the near future?
- [27:06]
B
Look, I think that what I'm seeing is that this next generation understands very clearly, really that collective action is the only way that we're going to improve things. So we have two things going for us. We have a generation of workers who are starting to understand the value of being organized, the value of standing with the people next to them. And we have, coming out of coronavirus, a shared experience that we can organize around the way. If we simply think that we're going to have the labor movement as it exists today change the political narrative here, it's not going to happen. It is going to require organizing in mass numbers. It is going to require spreading this good message that there's actually power to be had in the labor movement, not just as being a part, thinking of ourselves as a part of the political process, but actually understanding our power in the workplace where we can come together and be the only place where we are not a self selecting organization, but people from all different backgrounds where we can come together, build consensus and have real power.
- [28:13]
A
Sarah Nelson, thank you very, very much for sharing your time and your perspective. And as someone who has admired your activities already, this is very wonderful to hear and gives me a sense that we're ending a difficult year, maybe looking up. And so I commend you for what you've done. Thank you for being with us and I hope that our audience will listen and think about all, all you've had to say. Thank you. And to all of our audience. Thanks to Sarah. Thanks to you. And I look forward to speaking with you again next week.