By Levi Anthony - Posted 8/10/2011
Across the country, labor unions are under attack. In states such as Wisconsin, Indiana, Ohio and others, union stripping measures have been passed or in the process of being passed.
Why should this bother me if I am not a member of a union? Because labor unions are important to all working people. One of the most serious problems afflicting the nation today is income inequality – the income gap between the rich and poor. The last 30 years has seen a massive redistribution of wealth from the poor and middle class to the wealthy. Today the richest 1 percent of Americans controls about 24 percent of U.S. wealth.
Look at the chart below.
Between 2002 -2007, the income of the richest 1% of the population almost doubled. Over the same period, the rest of us have barely left the starting gate.
One of the reasons for this growing inequality is the decline of labor unions. Unions fight to make sure that the working classes get a more equitable share of the income pie. But union membership in the private sector has falling precipitously from about 30% in the 1960s to 7% today.
There is a correlation between middle class share of income and union membership. You can see from the graph below that middle class income has fallen with the drop in union membership.
So, unions are indeed necessary for a modern economy. The root cause of the economic crisis we face today is the lack of demand for goods and services. Businesses are not expanding and hiring new workers because there is no strong demand for their products. Consumers cannot demand these products because millions of them are unemployed or drowning in debt. Those who have jobs have not seen any appreciably increase in their income because those of the top are taking the lion’s share of the profits.
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