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An Inconvenient Economic Truth

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It's unusual to write a review of a movie you haven't seen.

But reading about Inequality for All, the new documentary screened at Sundance Film Festival, reminds me of a plot that I have seen in many countries around the world.

The drama in Europe, the Middle East and Africa unfolds something like this: economic and political leaders are positioned into power by vested interests from big business.

They are followers of an ideological school of thought where labor rights bring down profits, and advocate -- without evidence -- that they cost jobs, and will at any cost try to dismantle the social protections that bind our communities and societies together.

The Guardian reviewers called Inequality for All, the An Inconvenient Truth for the economy. Al Gore's presentation changed the way we looked at the facts about climate change, and activists organized screenings from Sydney to San Francisco to spread the message beyond traditional environmentalists.

Former U.S. Secretary of Labor and economist Robert Reich is the star of Inequality for All. He argues that anti-union laws and deregulation of markets have created an economy where wealth does not trickle down below an elite 1 percent. Now the majority of Americans cannot spend to grow the economy, as they don't have fair wages.

The inconvenient economic truth for leaders from the IMF, the European Commission and European Central Bank is that the very labor protections under attack have actually reduced inequality, built demand and made our workplaces and societies a fairer place for all. Communities know this.

Despite the economic lunacy, people are being cut out of society, with no jobs, and no hope that future generations will be better off. Our communities are falling apart.

If the impoverishment and community fragmentation continue, it is not a stretch to predict urban wars sparked by inequality, unemployment and the breakdown of dialogue between leaders and citizens.

The ITUC global poll of working people in 13 countries shows how demand is falling. For 58 percent of people, their income has fallen behind the cost of living. One in three people think their jobs are less secure than two years ago.

With no disposable income to spend, economies won't grow and there is no hope for the future. Indeed, 67 percent of people think that future generations will be worse off.

Economists agree their numbers match people's opinions.

Income inequality rose over the past three decades in 17 out of the 24 OECD countries -- the advanced economies of the world.

Meanwhile, last year, the world's 100 richest people became $241 billion richer. They are now worth $1.9 trillion.

Inequality is a poison that is destroying livelihoods, stripping families of dignity and splitting communities.

We know the antidote: strong democratic voices, strong unions and the right to collective bargaining for fair wages and conditions.

Yet countries like Romania, Portugal, Spain, Italy and Greece are trying to rebuild economies at the same time as having their collective bargaining rights slashed. It's not just working people affected as small business are withering under the pressure of unfair competition and lack of affordable credit.

In Romania, as a result of IMF advice, collective bargaining coverage has fallen by two-thirds in less than 18 months. This is entirely due to the abolition of the national collective agreement and collective bargaining at industry level.

The country now has only provisions for collective bargaining at enterprise level -- yet in Romania 90 percent of enterprises have less than 10 workers, according to the National Institute of Statistics. Unions and employers in Romania agree that there is a need for a national collective agreement that sets a minimum wage for all.

We must make both our distributional and democratic systems work for our communities.

Only 13 percent of people surveyed in the ITUC Global Poll think they have any influence over economic decisions of their governments. The democratic trust that people have in their leaders is being eroded.

By rebuilding the dialogue between workers, governments and business, we can grow our economies and give hope back to the next generation.

To do this, the attacks on workers' rights, on minimum wages on which people can live and on collective bargaining, all in the name of economic policy, must stop.

That's the truth.

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