Martin Luther King speaking in 1961

On Labour Day 2011 unions in North America are facing historic challenges. Governments and corporations are increasingly disputing the right of unions to exist and to represent working people. This is true not just in the United States. Here in Canada the president of the Canadian Federation of Independent Business, Catherine Swift, told the London Free Press:

What would be ideal is getting rid of public-sector unions entirely.

Not that long ago such a view would have been considered extremist. Now it is common in both much of the business community and the main stream media.

So Labour Day is a good time to review both what unions have given us and what has been lost in much of the world as governments reduce the rights of working people to democratically choose to act collectively.

Most people will acknowledge some of the legacy we have from unions. Unionized workplace pioneered the eight hour day and the five day week. They introduced health and safety rules and the ending of child labour. An Australian video encapsulated it rather well here.

But unions do much more. They help level the playing field both in the workplace and in society as a whole. In fact, as Dr. King suggested above, the argument can be made that since the end of WWII it was unions that were responsible for us having a prosperous middle class.

At the workplace level there is an enormous power imbalance between an individual employee and the boss. Acting with other workers through a union, that employee has a say on issues like wages, hours of work, schedules and working conditions.

Unions have promoted the rights of women and opposed racial discrimination. In unionized workplaces, the gap in pay between these groups and white men is smaller than is true for society as a whole. There are grievance procedures to protect their rights.

While some would stoutly deny it, many employers benefit from unions. Union employers tend to be more productive. Most union contracts contain education and training provisions. Better compensation and more respectful workplaces reduce the cost of employee turnover.

The benefits of unions reach beyond union workplaces. Non-union employers will often raise wages either to keep unions out or to compete with union shops for employees.

In society as a whole unions have played an important role in promoting social and economic equality.

Last autumn three international organizations published reports linking the decline of unions with growing economic inequality and the recent economic crisis.  UNICEF made among the most powerful statements saying:

The only sustainable way to reduce inequality…is to stop the underlying widening of wages and income from capital.  In particular we have to make sure people are capable of being in employment and earning wages that keep them and their families out of poverty.

The International Labour Organization called for more effective collective bargaining and for higher minimum wages. 

And the International Monetary Fund, no radical left wing organization, called for a restoration of bargaining power for low and middle income workers.

The common theme here is that for 30 years the influence of unions has been falling and for 30 years wages have been stagnant and profits have risen.

Unions have exercised an influence that goes beyond the economics of the workplace. Historically, unions were among the strongest advocates for Medicare and the Canada Pension Plan. The Canadian Labour Congress and its affiliates continue to be the most powerful voice for better public pensions for everyone. More recently, and closer to home, it was the unremitting campaign of the BC Federation of Labour that finally forced the government to end its 10 year freeze of the minimum wage.

Politically, unions have provided a balance to the power of money. This is something that the moneyed powerful cannot stand. That is why in the United States Republicans are working to destroy collective bargaining rights for unions. That is why in Canada grandees like Catherine Swift call for the elimination of public sector unions.

So this Labour Day spend a minute to think about what Canada would look like today if unions had not been there. And spend a minute thinking about what our future would look like with no balance at all to the power of money.

The poll was conducted in early August for the BC Federation of Labour.  It shows a solid majority of British Columbians disaprove of the way the government is handling the economic downturn.  Only 45% of people consider the government credible on budget forecasts, while 53% do not consider them credible.

Nearly 70% of British Columbians agree that public services need to be a priority even if it means a short term deficit.  Only a quarter of respondents want balanced budgets to be the top priority.

It comes as no surprise that the poll shows people opposed to the HST, but they are in favour of increasing taxes on corporations and wealthy British Columbians.  People supported a number of public services raised in individual questions.  For example, 86% supported investment in public services like post-secondary education and retraining programs.  Nearly 80% said they believed affordability was the number one barrier to college or university education.

Some people will seek to discredit the poll because it was conducted on behalf of the BC Federation of Labour.  However, Ipsos-Reid’s reputation rests with their integrity.  Agree with the results or not, they are a credible pollster.

In the Throne Speech Tuesday the government claimed a mandate from the May election to pretty well do whatever they want.  This poll and another released yesterday by the Mustel Group showing the Liberals falling 8% behind the NDP suggest the government might want to rethink its plans. After all, the election was not won on a promise to cut public services.

The Ipsos-Reid poll can be found at http://www.bcfed.com/node/1742.

This may be the first time you are hearing about the Ipsos-Reid poll.  So far nothing has appeared about it in any of the province’s newspapers.

Today Tom Sandborn writing for the Tyee posted a story quoting Premier Campbell’s response to health and safety issues. The story also dealt with the NDP and labour issues, but the NDP section focused on such issues as Green Bonds.

Here are some of the Premier’s comments.

On a CCPA report that called for better enforcement of worker safety regulations:

He said he had not read a recent study from the Canadian Centre for Policy Alternatives and the B.C. Building Trades Council that called for reforms to construction industry safety practices, and he expressed skepticism about the usefulness of on-site safety enforcement. “I don’t think it’s something where you say we’ve got, to be candid, a whole bunch of people coming around and throwing fines at people. I think it gets them to avoid the issue.”

Campbell did say he would read the report if it were sent to him, and expressed willingness to meet with union representatives to discuss safety issues and training.

and more:

Campbell was asked about the changes his government brought in during its first term that effectively eliminated lifetime pensions for injured workers and reduced the amount available for shorter-term WorkSafe payments by 13 per cent. Would a re-elected Liberal government at least restore the level of support for injured workers to 2001 levels?

“I won’t commit to that today,” the premier said. “I think we have a relatively fair system. Workers are now getting taken care of far more rapidly than they were before.”

A welfare rate increase, he said, was “not in the books.”

And finally, on public private partnerships:

the premier noted that the P3 (public private partnership) approach, strongly championed by his government, can slow timelines for projects. “Up front, they are slower, for sure.”

I never cease to be amazed that such a report, which outlines the hardship to injured workers from the changes to Workers’ Compensation, received no coverage in the commercial media. This is an issue, one more example of the tradeoff between cutting costs for corporations and cutting services for citizens, that deserves to be discussed in this election.

The report, Changes to the BC Workers’ Compensation System (2002-2008): The Impact on Injured Workers, was written by three veteran compensation lawyers.

The authors describe how the WCB refocused the debate on compensation to the cost of compensation rather than the needs of injured workers.

It was successful also in driving the changes that have in only six years resulted in huge surpluses in the WCB’s budget ($474 million in 2005; 987 million in 2006) and huge reductions in the average assessment rates charged to employers (estimated at 1.56 per cent of payroll in 2008, down from 2.29 percent in 1996, and now the lowest level in more than 25 years), at the expense of compensation to injured workers.

The decline in costs to the employers was not caused by reduced injuries. Total injuries reported and claims have been rising since 2003.

Employers lobbied in the late 1990s to have compensation costs reduced, but after their election in 2001 the Liberal government appointed an employer-side compensation lawyer to review WCB as part of the government’s Core Review process. His subsequent report recommended a greater focus on costs, but the changes have gone even further.

While compensation benefits for temporary disabilities were significantly reduced, as were a range of other benefits that we address in this Report, some of the most severe impacts have arisen from the reductions in long-term benefits for compensable permanent disabilities. Whereas permanent pensions had previously been payable for life and indexed by the CPI increases, since 2002, they have been payable only to age 65 and indexed by one percent less than CPI with a cap of pour percent.

As an example of how far services were slashed, between 2002 and 2005, the vocational rehabilitation budget was reduced by 98.8 percent (from $130 million in 2002 to $3 million in 2006).

The authors present evidence that the costs of the system were never out of control and in fact employers pay much less here than they do in provinces like Ontario. And most important:

The power to make and maintain a safe workplace lies in the hands of employers. Making employers responsible for the full cost of such losses can only create a powerful economic incentive to make workplaces safer.

Seven case studies in the report make clear the human costs of the drive to cut costs for employers.

The authors call for a systematic revamping of the compensation system.

We have described the current state of the system as a labyrinth littered with jurisdictional pitfalls and minefields, the result of a systematic attack on both benefits and the decision-making process. In our view, only a systematic approach can hope to remedy the result.

The reason for the closings, according to a Catalyst press release, is the collapse of newsprint consumption and pulp demand:

The rapid decline in North American newsprint consumption is unprecedented,” said Richard Garneau, president and chief executive officer, “and it requires us to focus sharply on cost management as we optimize production across our mills to match capacity with the order book.

As devastating as the closures are, they aren’t entirely surprising. Things have been rough at Catalyst for a while: Crofton curtailed production for 30 days in the fall, and the Elk Falls sawdust/containerboard mill near Campbell River closed at the end of November.

Reacting to the most recent news, Jim Sinclair, president of the BC Federation of Labour, remarked that we are witnessing the “slow de-industrialization of the province”. For the folks on the Island and in Powell River, of course, it probably does not feel slow, but whatever you want to call the pace of change, the problems are expanding.

Sinclair went on to call (again) for some cooperative efforts by industry, labour, and the province to find a way out of this mess, echoing the BC Fed’s letter sent to the Premier earlier in the month:

Contributing close to 40 percent of BC’s exports and 25 percent of our GDP, it is only fair, reasonable and just that British Columbians through their government join hands to assist workers and communities in that sector as it endures bad times. We believe a strong, sustainable forest industry can continue to be a vital component of our economy.

That letter contains some very concrete suggestions regarding what the government can do: extend forest workers’ EI coverage, fund retraining, reforest, and assist forest-dependent communities like Crofton with some money to cover tax losses.

These are excellent ideas. In the short term, the government must follow through on this. Failure to do so—and the budget sure makes it look like we are headed for a failure to do so—can only suggest that the provincial government has no idea how bad things are, and how much worse they are going to get.

As for taxes, it is only recently that Catalyst has laid all the blame on the global downturn. Last summer, when the Elk Falls closure was announced, the company said

The decision reflects the severe impact of a permanent loss of traditional sawdust supply, as well as significant energy and chemical cost inflation, high labour costs and the heavy toll being taken by the uncompetitive major industry municipal tax levied on the Elk Falls mill.

In January, Catalyst CEO sent a letter to officials in Powell River, Campbell River, Port Alberni and North Cowichan that threatened mill closure if annual property taxes were not reduced from $23 million to $6 million.

The heavy-handedness of this kind bullying may be offensive, but Catalyst’s annual losses show there is no denying that costs have to come down, and unions have been trying to help them do exactly that.

The government, in contrast, seems to feel that workers and communities need to eat all the cuts in costs. It apparently has no idea what it is getting itself, and everybody else in the province, into. The provincial forest industry is in freefall, and not just on the coast, of course. Whether it can ever be resurrected in a socially and environmentally acceptable form is a good question, one the province needs to take seriously.

What is essential right now is immediate short-term aid to forest-dependent communities, and a provincially-coordinated industrial restructuring with a long-term vision, the capacity to ask big, tough questions, propose a range of creative solutions, and the authority to follow through and work with communities to rebuild.

The government must step in to this morass, and do so with some enthusiasm and resources. This may mean taking a significant public stake in forest operations, even “provincializing” aspects of the industry and the coordination of industrial production.

These are huge problems, and they call for unprecedented action. If we wait, this one may appear to “go away”, but I’d bet the farm that much bigger ones will have taken their place.