THE BLOG
01/16/2015 12:50 pm ET Updated Mar 18, 2015

We Have Cure for What Ails State of the Union

When President Obama delivers the State of the Union address on Tuesday, he'll be able to bask in the glow of an economy that's much stronger than it was when he took office. We've finally emerged from the crash of 2008. We've had 58 consecutive months of job growth. Unemployment is declining. Productivity is up.

Yet, most Americans aren't exactly high-fiving each other. Never mind the state of the union; the state of their households isn't great.

If you listen to the business analysts and pundits talk about productivity, the Dow, record-breaking corporate profits and job creation, you'd think all is well. There used to be a time when good news in these areas was good news for all of us. But now, when I hear about overheated profits in corporate America and soaring stocks on Wall Street, I think, "Gee, how nice for them." That's because what happens on Wall Street stays on Wall Street. CEO pay and dividends increase, but workers' wages do not.

This is troubling not only because it is unfair to middle-class families who helped create all this wealth. It is also a concern because when the gains go only to the top 10 percent while real wages actually fall for everyone else, our economy is dangerously out of balance. It's like stacking 90 concrete boulders on top of 10 twigs. Eventually, something's gotta give.

Unions recognize this. The AFL-CIO held the National Summit on Raising Wages because those of us in the labor movement have long understood that the only way our economy can get stronger is from the middle out. It's spending by middle-class families that drives the economy. That means paychecks must increase, and the labor movement and collective bargaining are crucial tools for giving Americans a raise.

Lots of politicians talk about raising wages, but they ignore - or even seek to quash - collective bargaining. These are the same politicians who advocate right-to-work laws that weaken unions. They're the same ones who are making it harder for working people to organize and join unions. And they're the same ones who aid and abet the employers that threaten to pull up stakes if their employees vote for a union.

But the evidence is clear that unions work. During periods in our history when more working people were union members, wage growth was stronger and income inequality was less severe than now. From the end of World War II through the 1960s, the middle-class share of national income was as high as it's ever been, and the share of income going to the top 10 percent was at one of its lowest levels.

All of that changed beginning in the late '60s and early '70s, and not just because of globalization or technological advances. It changed because of policy choices "made on behalf of those with the most income, wealth and power," according to a recent study by the Economic Policy Institute. And one of those choices was to undermine collective bargaining. The result is that in 2014, only 11.3 percent of working people were represented by unions. Only 20 years earlier, the rate was 20 percent, and in the 1950s, it reached 35 percent. It's no coincidence that back then, workers' wages were at their highest.

Collective bargaining doesn't only benefit union members. It benefits all working people by lifting the floor for wages and benefits. Unions fight for norms and practices that then become widespread and are crucial to helping people get into - and stay in - the middle class. One of these norms used to be pensions. But as union density fell, the idea that people who work hard every day should be able to retire with dignity has, unfortunately, receded from too many sectors of our economy.

You see, the "State of the Union" is very much related to the state of our unions.

That's precisely why some progressive politicians want to take steps to strengthen the labor movement. U.S. Rep. Keith Ellison (D-Minn.) sponsored a bill to make labor rights a civil right so that workers who attempt to organize are given greater legal protections when those rights are violated. Ellison recognizes that only when more workers can negotiate at the bargaining table will pay begin to rise systematically and lift the entire middle class.

Dr. Martin Luther King Jr., whose life we celebrate the day before the President's speech, spoke out against the kind of capitalism that sacrifices people for the sake of profits. We must speak out just as forcefully against an economy in which so many working women and men are struggling to care for their families, even as they work harder than ever.