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Inequality cannot be remedied without trade unions

Workers-Rights-are-Human-Rights-e1363086471974Since 1979, when trade unions numbered 13.5 million members, trade union numbers have halved and the inequality ratio between top and bottom has trebled or even quadrupled. This is no coincidence.

Thatcher’s 6 anti-trade laws were designed to incapacitate union influence by hobbling their ability to recruit and organise effectively. The destruction of the nationalised industries in the 1980s removed a major source of union power. Illicit paramilitary tactics were used by the State to break the two epic strikes of the miners and the printworkers at Wapping and to establish, both symbolically and physically, the dominance of the employers over labour.  The welfare system was fundamentally altered from its Beveridge roots of assisting people in distress through no fault of their own, to be reconfigured as a means of pressurising people back into work. And globalisation – the internationalisation of market forces – has further increased the power of employers over labour.

Where is this leading for the future? As it happens there is some highly relevant evidence on which to base an answer.   The US went down the ‘flexible’ (i.e. free-wheeling hire and fire) labour market route some time earlier than Thatcher-Blair subjected the UK to it. What has happened in the US is therefore instructive. There has been a relentless squeeze on wages for decades to such a degree that average wages adjusted for inflation have not altered since 1980. Over the same period the benefits of growth have been almost wholly monopolised by the extreme rich –  the top 1% and proportionately even more by the 0.1% and 0.01%. What is disturbing for the UK is that these trends which are now being played out in the UK have persisted in the US and show no signs of diminishing, indeed show every sign of intensifying.

Of course it may be argued, and is being argued by the OBR and the Bank of England, that wages will recover in Britain as unemployment falls and productivity recovers.   But both of those assumptions are distinctly dubious.   Unemployment is falling very modestly from its peak of 2.5 million – it is still nearly 2.3 million – and productivity has been noticeably absent despite the economic upturn.   It is nearly lowest in the G7 and one of the lowest in the OECD; Britain remains a low-wage, low-skill and low productivity economy, and Tory policy is precisely aimed to keep it there.   What’s worse, even if productivity did recover its previous growth trend of 2% a year, there is no guarantee it would be evenly distributed between capital and labour.   Under today’s conditions it is all too likely that capital will pocket the lion’s share, if not almost all, of the proceeds.

Why is the injustice of the last decade persisting and why has the broken economic model that led to the 2008-9 crash not been discarded and a new model adopted.   A big part of the answer is that the countervailing force to the power of capital has largely been eviscerated, and until the trade unions can be rebuilt to provide the foundations of that countervailing power, the trend of widening inequality will not be reversed.

5 Comments

  1. Robert says:

    What can you say labour had the chance to end all the Thatcher anti labour laws they did not and poor old Miliband is a puppet of the Progress group.

    I’ve been in a Union since I started work July 1966 I’ve paid my political levy to labour and joined labour, but Falkirk ended my levy and my links to the labour party, the One nation group is now taking the labour party to the right not to the left and lets not kid our selves Cameron and Miliband the bed room tax is the difference and it’s not enough.

  2. swatantra says:

    Trade Unionists may well have to take to the doorstep and persuade all workers of the benefits of being in a Union. They need the same passion as Jehovah’s Witnesses, to knock on doors and be prepared to accept rejection. I had a couple of Jehovah’s Witnesses turn up on my doorstep on Sunday. I told them I’m a Hindu, so I couldn’t very well take their pamphlets. But I gave them full marks for trying.

  3. Matty says:

    A good article, pretty similar to that of Larry Elliott in The Guardian the other day. See http://www.theguardian.com/business/economics-blog/2014/jun/22/uk-unions-us-real-wages-higher-productivity

  4. David Ellis says:

    The unions are key but if they do not take up the grievances of the unemployed they will find them being used against them. Where are the unions on draconian benefit sanctions that are often imposed by union members and where are they on the question of employment? Wages and conditions for their members are one thing but they ignore these others at their peril.

  5. Robert says:

    Union to day are only powerful where the leaders are good and where all employers are union members look at the Underground the railways .

    Bob Crow may not have suited everyone he took the wages of the railway workers and the underground to new highs.

    Sadly the building trade are now mainly immigrants Polish people and sadly self employed.

    The slave labour of the old coal mining of course is not the massive retailers who make billions pay very little tax and see the min wage as the starting pay, sadly the Union are poor and have leader who main aim is to see how much they can earn from the labour party, I was sick of seeing and hearing of the top table of the Union making double their high wages for being on sodding committees.

    My Union the GMB was happy to see me and others like me going to ATOS they even tried to Unionize A4e for god sake. Union love money sadly not members.

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