Kai Ryssdal: Explicit in the tax plan that the White House rolled out today is the hope that changing things around is going to help the American manufacturing sector come back. Taxing this, not taxing that. Factories — and their present condition — have been much discussed on the primary campaign trail this year.
Commentator Robert Reich says the discussion has been more fantasy than reality.
Robert Reich: With upcoming Republican primaries in Michigan and Ohio, Mitt Romney and Rick Santorum have plans to bring manufacturing back. Last month President Obama announced a six-point agenda to do the same.
But despite all the campaign rhetoric, manufacturing will not be coming back. Pent-up demand for cars, appliances and machinery has stoked a small resurgence, but the long-term trend in this country is fewer factory jobs. After World War II, one in three Americans was employed in manufacturing; today it’s one in eight.
Even if we didn’t have to compete with lower-wage workers overseas, we’d still have fewer factory jobs. That’s because the old assembly line has been replaced by computer-controlled machines and robotics.
Bringing back American manufacturing isn’t the real challenge, anyway. It’s creating good jobs for the majority of Americans who lack four-year college degrees. Manufacturing used to supply lots of these kinds of jobs because factory workers were represented by strong unions powerful enough to get high wages.
Not any more. Even the once-mighty United Auto Workers has been forced to accept pay packages for new hires at only $14 an hour. That’s half what new hires got a decade ago, and about the same as most service-sector workers now get.
If there’s a single reason for the decline of hourly wages over the last three decades, it’s the weakening of unions. Membership has sunk from a third of private-sector workers to fewer than 7 percent.
But the presidential candidates aren’t calling for stronger unions. Romney uses every opportunity to bash them, and Santorum is hardly enthusiastic. Even the president, though pro-union, has been noticeably silent on the labor struggles roiling the Midwest — including Indiana’s so-called “right to work law” intended to weaken unions. It’s the first such law in the Midwest.
American corporations are doing well again, but hourly wages continue to drop. The ratio of profits to wages is now higher than it’s been since the government began keeping track.
The fundamental problem isn’t the decline of American manufacturing. It’s the declining power of American workers to share in the productivity gains of the American economy.
Ryssdal: Robert Reich teaches public policy at the University of California, Berkeley. His most recent book is called “Aftershock: The Next Economy and America’s Future.” Let us know what you think — write to us.
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