America's labor unions are finally waking up from their deep slumber and noticing the vast schism in American society between the haves and the have nots. The catalyst: Wall Street's $16.2 billion bonus pay day. As a result Richard Trumka, head of the AFL-CIO, the nation's largest union organization, and a firm supporter of the transaction tax which was proposed in late 2009 and then promptly buried after some serious lobbying by Wall Street, will announce today "two weeks of protests aimed at Goldman Sachs Group Inc., the most profitable securities firm in U.S. history, and the country’s five other largest banks. The AFL-CIO says it plans 200 events covering all 50 states, starting March 15." Summarizing the mood of increasing populist aggression across the nation against Wall Street's uber-wealthy is labor professor at UC Berkley Harley Shaiken: “Wall Street has become a symbol of greed run amok, and what labor is doing here is seeking to demonstrate that it is speaking for working families generally, union member or non- union member.” Strikes in Greece have already paralyzed the country. Will America soon follow?
More from Bloomberg:
At the “Make Wall Street Pay” rallies, which the AFL-CIO plans to announce today, union members will push for a transaction tax on securities trading to help pay for the $900 billion they want the government to spend on creating new jobs. That’s 60 times the $15 billion approved by the Senate last month. The House of Representatives last week passed an $18 billion measure.
Treasury Secretary Timothy F. Geithner has said he opposes the transaction tax, though Trumka says it has support in the White House. He declined to say who the backers are.
Lucas van Praag, a spokesman for Goldman Sachs in New York, declined to comment.
San Francisco-based Wells Fargo & Co. “recognizes Americans are demanding more from their financial institutions during these difficult economic times” and is “committed to serving the financial needs of businesses and individuals, keeping credit flowing, and working to help those in financial distress find solutions,” spokeswoman Julia Tunis Bernard said.
Labor unions have been furious that their traditional political allies, the Democrats, have essentially morphed into Republicans when it comes to treatment of social classes, with Wall Street getting top priority in all dealings, and everyone else a distant second. So far the only major concession that the presidency has presented to labor unions has been the preferential treatment in the automotive bankruptcies. Ironically, the Congressional Oversight Panel has come out with a scathing report noting that the Treasury's decision to bail out GMAC has been in fact counterproductive:
The U.S. Treasury's decision against a bankruptcy restructuring for GMAC may have increased taxpayer bailout costs for the auto finance company and made it less viable. "The panel remains unconvinced that bankruptcy was not a viable option in 2008," it said in the report. "In connection with the Chrysler and General Motors bankruptcies, Treasury might have been able to orchestrate a strategic bankruptcy for GMAC."
As a result, this will only make the pain more acute for labor when zombie organizations populated predominantly by labor, inevitably end up in liquidation due to their "reduced viability." And labor is fully aware of the increasing loss of its political clout.
By targeting banks, unions are trying to bring energy to a labor movement that has seen its ranks dwindle. Union membership in the private sector declined in 2009 to a record low of 7.2 percent of all workers, according to the Bureau of Labor Statistics. Unions represented about 35 percent of the private- sector workers in the mid-1950s, and 17 percent as recently as 1983.
“Unions don’t have the clout they used to, so they need to get the general public involved, maybe even people who are not normally union supporters, and remind them they are getting the short end of the stick,” said Charles Craver, a labor professor at George Washington University in Washington.
The rallies are similar to efforts by the Service Employees International Union, which has been targeting big banks for years. In November, SEIU president Andy Stern staged a rally outside Goldman Sachs’s Washington office, calling for the bank to cancel its bonuses. The SEIU, with 2.2 million members, is the nation’s largest union.
“SEIU believes that big banks played a central role in crashing the economy,” said Stephen Lerner, who directs the union’s financial reform project. “We are calling on them to be part of the solution instead of increasing their own pay while making problems worse for the rest of the country.”
So far Wall Street has laughed in the general direction of labor, knowing too well where the balance of power rests. However, should labor succeed in generating a grass roots movement on the coattails of the populist, and well deserved, anger at Wall Street, and throws in a few strikes for good measure, and things may change rapidly. After all just look at Greece, where the entire economy is now shut down as people say no to the draconian measures imposed on society by a government which for over a decade was drunk with providing entitlements courtesy of fraudulent economic representation. With austerity sooner or later sure to come to the US, the question of strikes is now not a question of if but simply when. And the primary target of all social activity is and continues to be the symbol of all that is wrong with the current system - Goldman Sachs.