Unions in the 1970s

UNIONS IN THE 1970s

Changing Labor Market

In the 1970s labor unions priced themselves out of a radically changing labor market. Too long during the decade unions continued to strike and bargain for wage increases without regard to the health of the industries whose workers they represented. In 1970 the railroad unions struck for two hours and received wage raises far above the rate of inflation without any increases in productivity. In the inflationary mid 1970s the United Auto Workers and the United Steelworkers demanded and received large increases in wages and benefits that did not recognize the severe cost pressures and profit squeezes that their respective indus-tries were undergoing. In the recession of 1979-1981 those industries responded to those pressures by laying off hundreds of thousands of workers. Also, several major unions—the Teamsters and the United Mine Workers among them—were caught up in corruption scandals that eroded the goodwill of Americans. One sign of the declining leverage of labor unions was the average number of workers involved in work stoppages, which declined from over 1.3 million during 1973-1977 to fewer than 850,000 during 1978-1982.

Fading Power

Early in the decade unions were still seen as major players in setting economic and political policy. In 1970 an eight-week strike by the United Auto Workers crippled General Motors and helped worsen a domestic economy already slowed down by recession. Faced with Stagflation, an economic malady where growth slows but inflation worsens, President Nixon in 1971 took the radical step of freezing wages and prices. Thus the major issue for unions in 1971 was the participation by several major union leaders—George Meany of the AFL-CIO, I. W. Abel of the United Steelworkers, Floyd Smith of the Machinists, Leonard Woodcock of the United Auto Workers (UAW), and Frank Fitzsimmons of the Teamsters -—in President Nixon's Pay Board. Nixon's New Economic Policy contained interventionist wage and price controls, methods which brought labor unions into the center of questions about economic policy. The Pay Board contained fifteen members, divided among government, business, and labor. Labor officials believed that they should have the majority voice on the board, it being their constituents that would have to live with the results.

Opposition

Meany ultimately refused to make wage concessions in the negotiations regarding wage and price controls and resigned from the Pay Board. Such confrontations were soon to become more commonplace between Nixon and much of organized labor. The AFL-CIO called for Nixon's resignation in 1973, ostensibly because of Watergate but with also much bitterness over stagnant wages and rampant inflation. The exception among labor regarding Nixon was the Teamsters Union. Nixon had pardoned former Teamster, president Jimmy Hoffa and counted on current president Fitzsimmons for support.

Lack of Options

As Stagflation continued, labor unions found themselves on uncertain ground. They dis-liked inflation, which eroded the value of the wage gains they could negotiate, but were frustrated by the tools used to fight it, which reduced employment and economic activity. The problem was exacerbated by the growth of low-wage, low-skill, nonunion jobs, and even within unionized industries the number of enrolled workers declined. Ironically, the greatest growth for unions came among government employees, a development that would have negative effects over the next two decades.

Worsening Conditions

The oil embargo of 1973-1974 made the problem with statistics much worse. Inflation peaked above 12 percent, and unemployment reached 6.5 percent. Labor unions called for massive government spending on job training and jobless benefits, but those calls seemed to be increasingly alienating to a public that was growing more antiunion in its beliefs. Unions were seen negotiating wage hikes well above the rate of inflation and securing additional benefits—such as thirteen additional paid vacation days demanded by the UAW—that the 75 percent of the workforce not represented by unions was not able to secure.

Public Alienation

The source of the public's alienation was multifaceted. First, the economy of the United States was becoming increasingly less industrial. With more service-sector jobs not traditionally represented by skilled unions, labor found that it did not have the structure to deal with these workers. Second, many workers felt that unions were negotiating for increased wages and improved health benefits and doing nothing about the disappearing jobs in industries such as auto manufacturing and steel production. Third, corruption in major unions helped to undercut the goodwill traditionally felt between worker and union. The arrest and conviction of United Mine Workers (UMW) president W. A. ("Tony") Boyle for fraud and murder was a black eye on the entire labor movement. The disappearance and presumed murder of former Teamsters president Hoffa and later corruption charges against union officials were also damaging.

Dealing with Carter

In 1979 the unions began what seems to have been a last try to become institutionalized partners in government. On 19 November 1979 Meany stepped down as head of the AFL-CIO and was replaced by the Georgetown-educated Lane Kirkland. Earlier that year Kirkland, as chief negotiator, had reached an agreement with President Carter that institutionalized the participation of the AFL-CIO, along with the Teamsters and the UAW, in the setting of government economic and social policy in exchange for a new effort at wage restraint.

Into the 1980s

The pact proved to be a wrong turn politically, as labor became associated closely, if unfairly, with what increasingly was being seen as a failed political leader. During the 1979-1981 recession, hundreds of thousands of jobs were lost in the automobile and steel industries, and labor seemed powerless to stem the pain. As Ronald Reagan took office in 1981, the labor unions became an easy scapegoat for the economic turmoil of the 1970s. Reagan's firing of the air-traffic controllers of the PATCO union in 1981 was a public repudiation of unionism and the dead end of the many wrong turns the labor movement had taken during the 1970s.

Source:

Michael Barone, Our Country: The Shaping of America From Roosevelt to Reagan (New York: Free Press, 1990).