For unions today in old economy industries like airlines, steel and autos, the harsh reality is that labor contracts are, to paraphrase Lenin’s view of treaties – like pie crusts made to be broken. In case after case, bankruptcy courts have applied Congressional intent favoring long-term rehabilitation to sweep aside wage and benefits concessions won at the bargaining table.
Organized labor is beleaguered – a fraction of their former strength in the private sector, divided by inter-generational warfare between retirees and current employees, with fewer friends on Capitol Hill, and facing the harsh reality that the victories won by legendary figures like the UAW’s Walter Ruether are unsustainable in today’s economy. Indeed, unions in these core sectors of the economy are facing threats to their institutional survival.
The new world order in bankruptcies such as United Airlines, Northwest Airlines and Delphi is doubtless a bitter pill to swallow for union leaders, employees and retirees, who clearly believed their companies made solemn promises on wages and benefits, and now have no place to go. Strike threats ring hollow when the company can show the entire enterprise will crater without a new deal. A more labor-friendly Congress or President might help, but even new laws cannot change the economic reality of unsparing global competition. Others call for greater imagination on the part of both management and union leaders, to think beyond the duration of a short-term labor contract.
In the face of a harsh bargaining climate, where the steady gains over the past five decades are at risk, what can unions do to counter these pressures? What are the prospects for the middle-class with organized labor in retreat? And what of the future for the growing segment of service workers who now predominate over union workers in manufacturing and transportation? These are the critical questions defying easy answers in this brave new world of the new economy.
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