posted September 4, 2011
Emerging Labor Responses to the Economic Crisis

On August 2 the Teapublicans achieved their number one short-term objective, forcing Obama and the Democrats to agree to a nearly $1 trillion immediate cut in the federal deficit and debt in exchange for allowing the debt ceiling to be raised. The Teapublicans also achieved their second most desired short term objective: no tax revenue increases as part of the deal. It was all spending cuts. They also got their third priority demand: no defense cuts. What did the Democrats get? Obama and the Democrats got what they obviously thought was their number one demand: an agreement not to use the debt ceiling issue as a hammer for more spending cuts until after the November 2012 election. For that they were willing to cut a deal, raise the debt ceiling so bondholders could continue to get paid on time, and to agree to forego cutting defense spending or including tax hikes on the rich and corporations as part of the deal of August 2.

Of course, Democrats (aka Timidcrats) will soon be disappointed, despite what they think is an ‘agreement’ with the Teapublicans on the matter of no ‘hostage taking’ of the government again before the 2012 election. By the end of the week, August 5, the Teapublicans were already declaring they intended to do it over again. After all, it worked last spring. It worked again this summer. Why not keep at it.

The next blackmail event will likely be the October 1, 2012 deadline date for next year’s general budget. After that there’s the December 23, 2011 deadline for deciding on the recommendations due by that date by a bi-partisan committee of Congress created as part of the August 2 deal.

The bi-partisan committee was created as part of the August 2 debt ceiling deal. The bi-committee members will be appointed by leaders of both parties of Congress by the time this article appears in print. The bi-partisan committee’s members will no doubt be composed of conservative Democrats plus ultra conservative Teapublicans. Isn’t this been the pattern? We saw it with the President’s appointment of the Bi-Partisan Deficit Reduction Commission, chaired by ultra conservatives Simpson and Bowles. It recommended $4 trillion deficit cuts last November 2010, giving cover to radical Teapublicans and setting in motion the current deficit cutting binge. And we saw ‘commission stacking’ in the equally conservative Congressmen appointed by Obama to provide recommendations for his Health Care bill in 2010, who refused to even mention the option of universal health care in their recommendations. No reason to think it will be any different this time with the bi-partisan commission emerging from the August 2 debt ceiling deal.

To ensure the bi-partisan committee’s almost certain conservative recommendations will be adopted, the August 2 debt deal requires the committee’s recommendations are voted simply “up or down? by the rest of Congress. No amendments. No changes. In other words, as the crisis deepens democracy weakens.

The bi-partisan committee’s forthcoming proposals represent a ‘reopener’, as they say in union negotiating circles. Before the end of the year another $1.2 to $1.5 trillion will have to be cut. That’s part of the August 2 debt ceiling deal as well. That’s a total of between $2.2 and $2.5 trillion. The committee will recommend a minimum of $1.5 trillion in deficit reduction in spending cuts and tax hikes. If Congress can’t agree (and there’s little evidence it will) to cut $1.5 trillion with tax hikes, then the $1.2 trillion in deficit reduction automatically will go into effect before year end. The August 2 deal language specifies the $1.2 trillion cuts will be distributed proportionally between defense and non-defense spending. It has no reference to tax hikes.

Meanwhile, ‘Rome is Burning’, as they say.

Fictitious Debt Crisis vs. Real Jobs Crisis

The U.S. economy has been declining well before all the debt debate charades that began last spring. We now know GDP, Gross Domestic Product, fell to only 0.4% in the first quarter of 2011, and less than 1.0% for the first half of this year. It will be worse for the second half. Housing continues at depression levels with no recovery in sight. Manufacturing has flattened out. Services are slowing. And jobs are now experiencing a ‘triple dip’. Contrary to all the desperate hype about job creation by the government the facts are dramatically clear: Jobs are in freefall for the last four months. Here’s some facts from the US government’s own Bureau of Labor Statistics; that is, the other jobs database that isn’t being reported by the press.

Since March of this year, non-agricultural jobs in the economy have declined every month, for a total of 911,000 jobs lost since March 2011, including a decline of 198,000 last July. That number virtually wipes out the number of jobs created in the preceding year. More disturbing, jobs for full time workers fell by 926,000 over the last four months. So why didn’t the unemployment rate shoot up if this happened? Because 595,000 workers—the discouraged and marginally attached as they call them—gave up finding jobs and left the labor force altogether in just the past three months. And part time employees increased by nearly 500,000 in the past three months. What’s going on is a massive ‘churning’ of lost full time jobs—going out of the labor market or into part time employment. And that’s before announcements of mass layoffs that once again began to appear in late July hit the jobs numbers in September-October.

It is becoming increasingly clear in the weeks following the August 2 debt ceiling deal that much of that was ‘managed theater’. Not only did the Teapublicans create a crisis in order to extract trillion dollar spending cuts from the US budget, but the Obama team played the ‘sky will fall’ card as well. John Q. Public was sandwiched in between. In stark contrast, the jobs crisis is anything but artificial.

When the debt ceiling deal passed on August 2, the pundits argued the stock market and business confidence would once again boom. After all, cutting the deficit and debt, conservatives and business interests argued, was necessary in order to restore business confidence. The debt deal would restore that confidence. But within 24 hours there was no stock boom. In fact, the stock market sagged seriously. The reason? Reports on August 2 showing global and US manufacturing had plummeted the previous month. Then the next day, consumer spending went negative. Both were back to mid-2009 recession lows. The stock markets fell precipitously, not only in the US but globally. In short, ‘real’ economic conditions—not phony debt ceiling debates—were the determinants of business confidence. The terrible ‘DD’ word was beginning now to appear: Double Dip recession. Smothered by the phony debt debates was the real problem of jobs, housing, and consumer income stagnation. With no job creation, continuing falling home prices, rising foreclosures, and wages (and payroll tax cuts) eaten up by escalating oil, gas, food, healthcare premiums, and other prices—there was insufficient income to buy things. That’s the source of failing business confidence and the refusal of business to invest the $2 trillion hoard in cash they’ve been sitting on for a year now in jobs in the US.

The Emergency Labor Network and Conference

Anticipating these events as far back as January 2011, a number of local union activists began exploring how to take action to do something about it.

About 100 of local union activists met in Cleveland in early March to discuss possible public responses to the growing crisis. A coordinating committee was established, and an invitation sent out to other union and worker circles in the US to have a broader conference to carry on the work. This conference was held this past June 23-25 in Kent, Ohio.

Representatives came from all over the country, including longshore union officers from both coasts, large contingents of public workers from Wisconsin and Ohio, building trades workers from the Midwest and south, immigrant rights groups sent representatives, some came as delegates from labor councils, organizers from several unions and community groups, and even some State federation level union officials attended. This was no ‘left intellectual’ gathering. Nor some far left radical grouping. These were solid, grass roots, local union people concerned about doing something.

Agreeing they could not substitute themselves for the trade union movement, nor speak in its name, the agreed upon purpose of the conference was to start a process with the ultimate goal of promoting mass actions on behalf of progressive demands; to define that set of progressive demands to take back to central labor councils, their unions, their immigrant organizations, their communities; and to go back home after the conference and try to build a national network for purposes of communicating with each other, to build labor-community fightback committees, and to get public actions and demonstrations going in their respective communities and unions.

Some of the Emergency Labor Network (ELN) demands included the following:

1. Launch a national campaign for ‘No Concessions, No Cuts’ and to Defend and Expand Social Security, Medicare, and Medicaid; to Tax the Rich and Corporations; Single Payer healthcare via Medicare for all; launch a Federal Public Works Jobs program; End the Wars and Bring Home War Dollars for human needs; Protect and Expand Immigrant Workers’ rights; and Defend and Expand Collective Bargaining.

2. Promote and support strike actions around the above demands, such as defending the strike by Longshore Workers’ Local 10 against the Pacific Maritime Association in solidarity with Wisconsin workers and their unions on April 4. Support mass actions such as recently called by SEIU’s ‘Fight for a Fair Economy’ and National Nurses United’s ‘Main Street Contract for America’ campaign, as well as other unions and community organizations calling mass actions opposing concessions or attacks on Social Security, Medicare, and Medicaid.

3. To refuse to support, and actively oppose, candidates for office at all levels who vote for ‘cuts and concessions’ in public services, jobs, Social Security, Medicare and Medicaid.

4. To organize the unemployed, repeal repressive labor laws like Taft-Hartley, and help promote and build a Southern Alliance for Collective Bargaining and organizing.

5. To oppose the criminalization of immigrant workers, reform immigration laws, immediately legalize undocumented workers, demand their right to organize, repeal employer sanctions, oppose guest-worker programs, and strengthen family reunification.

6. To support and help build October demonstrations against the wars in cities across the country, bring home the troops now, close foreign bases, and use the money for jobs and education.

7. To demand that their unions withdraw financial support for politicians that demand concessions, and use the money to build mass mobilization in the streets and workplaces around the above ELN demands, which will include running labor’s own independent candidates for office.

Citing AFL-CIO President Trumka’s recent statement for a more independent labor movement, the conference noted “The time has come for the labor movement to promote a discussion on what it will take to build a real labor party in this country? and that the ELN will undertake efforts to advance this goal.

The conference concluded by issuing letters of support to Fedex workers’ organizing efforts, Greek and Haiti workers under attack, and proposed to issue an Open Letter to the US Labor Movement, with model resolutions to submit to union bodies nationwide calling for a National Day of action in the fall to jumpstart a national organizing campaign around ELN demands.

Following the conference, in just the month of July the San Francisco central labor council and the New Jersey Industrial Union council adopted the ELN demand for defending Social Security, Medicare, and Medicaid—as did the Communications Workers of America’s 56,000 member national retirees’ organization at its recent national convention. Public rallies to defend social security and medicare have been held in New Jersey by ELN conference participants with members from CWA, Teamsters, AFT, SEIU and various community groups together. Demonstrations have also been organized at unemployment offices. Other ELN conference participants have organized public demonstrations scheduled for October 8 in Washington DC around ‘saving our social insurances’. Others are planning public actions with faith and community groups. Still other union retiree groups in the San Francisco bay area are in the process of organizing union pensioner groups and supporting public demonstrations on October 1 in support of jobs and on October 8 in solidarity with Washington DC.

A national communications website has been set up by the ELN and may be accessed at, where contact information, endorsers, the ELN action program, its ‘Open Letter to the Labor Movement’, sample resolutions, reports on actions, and articles of interest are available. The ELN secretary and coordinators may also be contacted by email from the site or at

National Nurses Union Steps Out

At a more national level, opposition to the debt and deficit cuts and the forthcoming major attack on Medicare-Medicaid is being organized by the 170,000 member National Nurses United union of nurses. The NNU has called for a coast to coast national day of action on September 1. Many of its regional unions have already begun actions in July and August in a build up to the national event. The Nurses Union event on September 1 will also demand national legislation to tax Wall St. financial transactions—stocks, bonds, derivatives, and futures contracts. It has proposed a ‘Main Street Contract for the American People’ and has asked supporters to take the ‘Main Street Pledge’. For more actions planned, readers can visit

The NNU has also recently taken a lead by demanding Congress vote ‘No’ on the recent August 2 debt ceiling deal. As the NNU’s executive director, Rose Ann DeMoro, declared on August 1, “What Congress and the White house should be doing is promoting programs that create jobs…It’s time for Congress to stop pandering to economic elites, who fund their campaigns and continuously lobby to protect their vested interests.?

The Teamsters Convention

At the recent Teamsters national convention a number of resolutions were introduced and passed supporting Wisconsin workers in their recent struggle with right wing politicians funded by the multi-billionaire Koch brothers’ corporate empire. One such resolution called for ‘National Days of Action’ in 2012 and that the Action “signal labor’s independence in mobilizing the US working class around a program and actions that shape a new direction of democracy and wealth distribution?.

Trumka and the AFL-CIO

The largest labor federation in the U.S., the AFL-CIO, contributed more than $400 million to Democratic Party elections in 2008, and hundreds of millions of dollars ‘in-kind’ in terms of unpaid services. It has obtained in turn virtually nothing for that investment from Democratic party politicians who received virtually all that money, hard earned union members’ contributions. The unions’ number one demand—card check for organizing to turn around decades of union-busting and union-destruction by money interests—never even got out of Congressional committee. No group has suffered more from the recent recession, nor the failed Obama economic recovery policies. Jobs collapsed in 2008-09 and have never recovered. A jobs ‘double dip’ occurred in the summer of 2010 and another is now in progress. AFL-CIO positions and demands on just about every subject since Obama came into office have been either rejected or ignored by the Democratic party.

In places like Massachusetts and Connecticut, and elsewhere, it is Democrats leading the charge to cut pensions, healthcare benefits, and jobs for public workers in unions. Democrats in a majority now champion free trade agreements with Panama, Columbia and South Korea. Obama has spent trillions on tax cuts for the wealthy and corporations and proposed nothing that remotely resembles a job creation program for labor.

Expressing his frustration with this treatment by Obama and the Democrats, this past June, speaking to a conference of the Nurses Union, AFL-CIO President, Richard Trumka, declared “We want an independent labor movement? and added “We can’t simply build the power of any political party or any candidate. For too long we’ve been left after the election holding a canceled check, waiving it about—Remember us? Remember us?…Well, I don’t know about you, but I’ve had a snootful of that shit!?

Earlier this year the Firefighters Union announced in April that it would stop all political donations to Congress (aka Democrats) because of their record of not fighting for union rights. In May Trumka called for “an independent labor movement?, but made it clear the AFL-CIO would not yet halt political donations to Congress. The labor federation may have had a ‘snootful’ but it was still willing to go on sniffing.

Since June the AFL-CIO has slowly and cautiously continued to distance itself—in words—from Obama and the Democrats. The recent eruption of the debt ceiling debacle has moved this shift slightly further.

On August 3 the AFL-CIO Executive Council issued a statement in the wake of the debt ceiling deal, charging politicians of both parties with failing to address the profound economic crisis and exacerbating that crisis by producing “an unending series of fake political crises? and adding that “Unfortunately, far too many Democrats have been either silent or complicit in the Republicans’ scheme?. The Council’s statement went on to add, in a cautious but important opening, “There is no way to fund what we must do as a nation without bringing our troops home from Iraq and Afghanistan. The militarization of our foreign policy has proven to be a costly mistake. It is time to invest at home?

Although not as yet announced publicly, the AFL-CIO has also called for a national day of action some time in early October to protest the deficit cutting mania embraced by both parties, demand a real jobs creation program, and demand that social security, medicare, and Medicaid not be sacrificed. It remains to be seen, however, whether these public demonstrations and protests will become more than just another perennial ‘verbal warning shot across the bow’ to Democrat politicians, or whether the beginning of charting a new, more independent political course for the AFL-CIO. The ELN has called for a national day of action and public mass protests on the specific date of October 1. The Nurses Union on September 1, and other actions in Washington DC are planned for October 8 and later.

Will Labor Rise to the Challenge?

As of August 2011 it appears increasingly to many observers that the Democratic Party is intent on destroying its one remaining differentiation from the Teapublicans: its long term stance in defense of social security and medicare. The Teapublicans have consistently outmaneuvered the Democrats on the deficit cutting issue for almost the entire past year. Obama’s first two years in office were characterized by an economic stimulus and recovery program that bailed out the banks, big business, and the wealthiest 10% households but have done virtually nothing for workers, small businesses, and the bottom 90% households. That policy failure—and Obama’s passive-obsessive character seeking always to concede in the name of bipartisanship but getting his extended hand bitten by his opponents with every gesture—resulted in the President’s loss of political control of the economy and his own political future. Since last November 2010 there has been a major about-face and shift in the direction of US economic policy. We have crossed the chasm into the desert of austerity politics. The already weak recovery since November has now given way to a rapidly declining economy and no recovery, in a transition to a re-recession.

Should Obama and the Democrats abandon the defense of social security and medicare, which this writer predicts they will, then there remains no substantive difference between them and the Republicans. Of course, Obama’s advisers are no doubt telling him to not worry, labor and working class voters will have no where else to go in November 2012. They’ll be confronted with a ‘wild right wing Teaparty’ choice and will turn back to him and the Democrats. They will have no choice. But they will have a choice. Neither Teaparty or Obama. They will vote…with their feet and stay home.

In the coming months the senior leadership of the trade union movement will wag their finger at their Democrat friends, threaten, cajole, plead, and otherwise continue to waive their blank check and implore ‘Remember Us. Remember Us.’ But the only way they will move toward independent political action is if their grass roots membership take the lead and drag them into the future. Much will depend in the coming months on actions by unions like the Nurses and other, now emerging grass roots labor organizations like the ELN and other similar efforts being now developed from scratch, from Oregon to South Carolina. Whether they can reach a threshold in time before it’s too late—before the Teapublicans’ deficit cutting political steamroller under which Democrats seem intent on throwing themselves destroys the economy—remains to be seen.
Jack Rasmus

Jack is the author of Epic Recession: Prelude to Global Depression, Pluto Press and Palgrave-Macmillan, 2010; and the forthcoming Obama’s Economy: Recovery for the Few, same publishers. His blog is and website:

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