Monday, December 12, 2011
Thomas Shevory, Ithaca College
A fair amount of attention has recently been given to Republican Governor Mitch Snyder of Michigan’s move to place a number of Michigan cities under emergency financial management. This possibility has long existed in the state, but it has been strengthened as Public Act 4, under which appointed managers have the authority to void union contracts, dismiss elected officials, and dissolve municipalities entirely.
Four cities, including Flint and Pontiac, have already been subject to the law's provisions, and Detroit, the largest city in Michigan, may be next. If Detroit were to subjected to a takeover, more than 50% of the African-American population of Michigan would no longer have democratic control over their local governments.
The equal protection ramifications of this are obvious, and the Justice Department is taking a look at the state's actions. At the same time, an attempt is under way to have the law repealed under referendum, with nearly all of the necessary signatures having now been collected. Given this threat, the state legislature is drawing up a new version. The governor's popularity, it is worth noting, has fallen to less than 20%.
Reading about his recently, I was reminded of an excellent film by Liz Miller, that we screened as part of the Finger Lakes Environmental Film Festival a few years ago, about the earlier version of the law as applied in Highland Park, Michigan.
Henry Ford bought 160 acres in Highland Park in 1907 to construct his first automobile plant, and in 1913 it became home to the world's first conveyor-based assembly line. The birthplace of mass production has fallen on hard times in the last couple of decades, as jobs left, population declined, the the tax base eroded. The Waterfront tells the story of the appointment of Emergency Financial Manager Ramona Henderson-Pearson to oversee the city's budget.
Henderson-Pearson looked around to see what of value the city had to offer and decided to sell the city's public water supply to a private operator. As with most privatization schemes, the two-fold aim was to raise money and to apply private sector "efficiency" principles to formerly public sector operations.
The result was a version of Cochabamba on Lake Erie. Rates were raised, and draconian measures were implemented to collect bills. In some cases, residents were sent bills as high as $10,000. Given leakages and aging water meters, the accuracy of readings was highly suspect. If residents didn't pay, they were subject to losing access to water and, in some cases, foreclosure.
The community's citizens rose up, under the leadership of, local-resident-turned-activist, Valery Johnson. And when it was learned that she was being paid $250,000 a year for her services, Henderson-Pearson was forced to resign. The city regained public control over its water works.
Under the old statute, city officials kept some oversight, so there was a check on managers, as well as a democratically elected structure that could retake control when the managerial system collapsed. In the new regime, elected officials may simply be fired.
The Waterfront is a cautionary tale about what occurs when local citizens are deprived of their democratic rights in favor of supposed managerial expertise and efficiency. The problems of the rust belt are deep and long-running, but they can best be solved by more democracy, not less.
Monday, October 10, 2011
The accolades for Steve Jobs have been non-stop, coming from all quarters. This strikes me as especially interesting, given that business leaders aren’t generally in favor at the moment, as is evidenced by the Occupy Wall Street demonstrations.
Jobs was praised on MSNBC as a “populist” business leader, and as an “artist.” He was hailed on Public Radio as someone that took ugly, albeit practical, computers, and made them beautiful and user-friendly. There have been some dissenting voices, but not many. My guess is that this can be partly accounted for by the fact that cultural elites tend to be Apple users.
Jobs' capacities for creating beautiful consumer goods cannot be denied. I say this as a MacPower Pro user (on loan from my workplace) and an iPod owner, who has never been completely bitten by the Apple bug. The MacBook is smooth, sleek, and very expensive. Yet my Toshiba netbook works equally well for most functions. Unlike the MacBook, when I wanted to upgrade the operating memory, I just popped the bottom off, and slid in the card. And I still can't use WordPerfect on my Mac.
Personal preferences aside, was Apple as transformative for the American economy as the Jobs accolades suggest? No doubt, Apple had a huge impact on a segment of the consumer market, and indirect effects that ricocheted through the entire personal computing industry. One of Apple’s most significant contributions was through iTunes, which, along with heavy-handed copyright enforcement, contributed to the decline of free music download services, and may have saved what's left of the recording industry.
But Apple, itself, did very little to contribute to the overall American economy in terms of job creation. One study found that the manufacturing of iPods created 41,000 jobs globally. Practically nothing in the grand scheme of things. Most of these jobs, 27,000 of them, were created offshore, while the remaining 14,000 were in the U.S. itself. (By contrast, General Motors, still employs over 142, 000 people in the United States alone, with millions of others connected through networks of support services.)
Granted most of the income generated, by Apple, was in the U.S. But that indicates the reverse side of the equation, that most of the offshore jobs were under poor working conditions, with low pay. Yet, even in the U.S., the division of labor was pronounced, between high skilled technical jobs and managerial positions, and low end retail jobs, with less than 6,000 are in the former category. While relatively few people actually work at Apple, many of those that do are well-compensated.
Apple then intersects with deindustrialization in a couple of ways: The company did very little to reverse the decline of reasonably well-paying manufacturing jobs U.S. In this respect, it mirrors the digital economy in general, which often creates great wealth, while doing little to redistribute it through job creation. Also, Apple would not have been possible without deindustrialization. Apple products would not have been affordable, even to high-end consumers, without the low-wage manufacturing infrastructure that preceded it, and set the stage for, the digital revolution.
The Apple aesthetic, and Steve Jobs flair for public relations, certainly served the company well. In the 1990s, Nike came under heavy attack for its use of sweatshop labor, which led to a decade long battle with anti-globalization and labor groups. While criticisms have been leveled at Apple for its labor practices, it never experienced anything like Nike’s problems.
My intention here is not to speak ill of the dead, but to point out that the focus on one individual to the exclusion of the structural economic features, diverts attention from larger trends. And keeping an eye on the latter is especially important during a period of economic dislocation, as we are currently experiencing.
We should all celebrate Steve Jobs creativity, imagination, determination, and his equanimity in the face of death. We should recognize and appreciate the important contributions that Apple has made to digital culture. But I think we should also maintain a sense of perspective.
Thursday, February 24, 2011
What’s happening in Wisconsin could be seen as the final blow of deindustrialization. Deindustrialization was after all closely connected to undermining union power and undercutting labor costs. The global flight of capital began its movement from the North into the American South, because unions there were either weaker or non-existent.
As deindustrialization took hold in the 70s, union membership dropped markedly. Former union members lost their jobs, and others were cowed due to the lack of worker protections and took lower paid jobs. The retail sector grew as cheap goods flooded the U.S., but it was difficult to organize, partly due to extreme and effective resistance on that part of management.
As a result, the gap between the non-unionized and unionized workforces expanded, not just in terms of wages and benefits, but in terms of a cultural understanding of the necessity of unions. Support for unions has declined, as they have been seen by many non-union workers as ineffective, irrelevant, or privileged. Private sector union membership is now below 7%.
The exception to union membership decline was the public sector. In the 80s and 90s, in spite of Republican hostility, as manifested by Ronald Reagan’s successful attempt to break the air traffic controllers’ union (PATCO), public sector union membership remained relatively strong, especially at the state level. The public sector was an island of stability in an unstable economic world. Public employees held job security, health benefits, and pensions, as those things became increasingly scarce within the private sector workforce.
Of course everything has its costs. Local and state governments had to pay the salaries and benefits for unionized state workers. But, in return, the public received essential services, from health care to education to bridge repair. Public sector jobs kept people from poverty, gave them the resources to send their kids to college, and, as a form of public spending, had a counter-cyclical influence during periods of economic recession.
One question raised by the Wisconsin case is whether an existential threat to this last bastion of labor stability will bring people together, in recognition of a common enemy, or whether it will create resentment and fragmentation, as in, “I don’t have mine anymore, so why should you have yours?”
According to a recent New York Times article, the politics of resentment is ascendant. The Times quotes several private sector employees, some members of labor unions, who are supporting Governor Walker in his attempts to dismantle the public employee unions. In the words of one woman, "I don't get to bargain in my job either."
But it’s not clear that the article is an accurate representation of what’s happening. There are other indications that solidarity between workers is expanding rather than contracting, not just within the leadership, but among the rank and file. Public support in Wisconsin, in general, seems to be moving to the side of the state employees.
It’s hard to reverse a downward spiral. When people start to lose, there is a tendency to lash out. And it’s hard to be optimistic, given the past forty years of labor history. But Governor Scott Walker may have actually crossed a line.