Saturday, July 17, 2010

When Labor (as in AFL) Still Wanted to Work

In the summer of 1934, about the same time in FDR's Administration as we sit in President Obama's, despite the creation of numerous new agencies and bureaucracies designed to get Americans working again, the unemployment problem simply would not improve. With upwards of 20% of Americans not working (Not so very far off from today's U-6 of over 17%. U-6 is the Labor Department's gauge of underutilization, which accounts for those who have given up looking for work or can't find full time jobs.) William Green, head of the American Federation of Labor (AFL) began arguing with one of FDR's New Deal Agencies--the National Recovery Agency (NRA) over new job creation. As Amity Shlaes explains in The Forgotten Man, Green wanted "industry, not relief agencies, to solve the economic problem" (Shlaes 201)

Addressing the surge of NRA hirings and subsequent layoffs, AFL's Green said, "We cannot indefinitely support one-sixth of our population on money borrowed against future taxes" (201).

The New Dealers were worried because after all the gyrations and machinations, after the grabs for power and unprecedented centralization the "...Depression was refusing to disappear" (202). At the American Bar Association's annual meeting during the summer of 1934, a report submitted showed that over the last year of FDR's Administration, 10,000 pages of new law had been written dwarfing a century and a half of federal law which numbered 2,735 pages. For all the agencies created and money spent to puff up government the unemployment rate during that one year period had declined from 22.9% to 21.2%.

The AFL's Green understood instinctively that growing government would not put the people back to work. Today's union leaders, however, instead of fighting against our unprecedented and unsustainable borrowing from future generations that has done nothing to improve the unemployment picture would seem, rather, to feed at that very trough.

Where is the outcry from labor now? Andy Stern, former president of the country's largest union, the SEIU, (the powerful service workers union) in now a member of one of the very agencies Green decried. Stern, who until he left his job to join the Administration was one of the most frequent guests to the White House is now a member of the National Commission on Fiscal Responsibility and Reform.


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