No right to work in “right to work” laws

The Thinker by Rodin

Wisconsin is the latest state to enact a so-called “right to work” law. With this law exactly half of the states are now right to work states. If your state is a right to work state, this means that you cannot be required to join a union as a condition for taking a job. If collective bargaining exists at a job site, the union can still negotiate benefits for you. You just have the right not to pay them union dues.

The effects on employees in these states are easily documented. In general you will earn less for the same job than in a state with no such laws. Unsurprisingly, this is because it is harder for a union to win the right to negotiate wages and benefits when they have fewer resources (union dues) to do it with. If paying union dues bothers you, there is an alternative: don’t take a job in the first place. If you think union dues are too high, as a union member you can petition for changes. Like any union (such as a credit union) a labor union is owned by its members. A union can disband itself if its members feel it is ineffective or if its dues are too onerous.

The supposed rationalization for right to work laws is that you as an employee should not have to pay from your wages fees that you do not want to pay. However, we are already required to have withheld from our wages federal income taxes, state income taxes, often city income taxes, pension contributions, Social Security and Medicare taxes. We can’t opt out of these. In many states other things are automatically withheld unless you explicitly opt out, such as your contribution to a 401-K retirement fund.

What if anything does all this have with a “right to work”? The theory seems to be that paying union dues by itself might be the difference between having a job that pays a wage you can live on and one you cannot live on. This is at best a dubious proposition, since you would be hard pressed to find a service-related profession where the real wage (after union dues) is less than a similar job without a union. It’s almost guaranteed that union members will negotiate better benefits for their members than you would by yourself bargaining with your employer.

“Right to work” laws are misnamed. You have no right to a job in any state. The closest we came was during the Great Depression. Government-created agencies like the Works Progress Administration and the Civilian Conservation Corps hired the unemployed to build bridges and improve our national parks when private industry would not. My grandfather was one of these people that depended on a WPA job during the Great Depression. Today, if you are unemployed the best you can hope for are some limited unemployment benefits and food stamps. The reality for most people is that these benefits don’t begin to cover the real cost of living, so they are employed. They are just not employed enough to have a living wage. Many of these people are so good at finding jobs that they have two or three jobs simultaneously, generally part time with no benefits. Yet they still cannot afford to live and they survive at the margins, perhaps in group housing but often they end up homeless.

So right to work states don’t guarantee any right to work. Such laws thus provide no particular incentive to get work. And if you can’t find a job, state assistance at helping you find a job will be marginal at best. Maybe there is a state unemployment office where you can go to look at local job listings, although this is mostly done online now. To the extent you can get unemployment benefits, you will likely have to prove you are diligently searching for a job. This isn’t normally a problem because you cannot survive long on unemployment benefits. At best you will draw from your savings less quickly than you would without them.

What would a right to work look like? A right is distinguished from a privilege because it is inherent and inalienable. You have the right to practice the religion of your choice. If you had a true right to work then either a employer would have to hire you or the government would be the employer of last resort. You might not like the work they would give you but it would be work that you are capable of doing. And since it would be work instead of free labor, they would have to pay you a wage. And since we work to survive, the work would have to pay a living wage, i.e. you should be able to live above the poverty line from a full time job.

You’ll see none of this in any “right to work” state, or any state at all, which means there is no right to work in this country. What they really are is “the right to opt out of paying union dues while enjoying the benefits of a union should your job be covered by a collective bargaining agreement.” Of course if because of insufficient union dues, the union goes bankrupt then you are out of luck. And as is often the case in right to work states, with no requirement for you to pay union dues, most unions can’t organize to win collective bargaining rights. Unsurprisingly “right to work” states have much lower rates of unionized workers than other states.

Without a labor union not only are you likely to have fewer benefits, you are also more likely to lose your job, which contradicts the whole “right to work” philosophy. You are an “at will” employee, which means you can quit for anytime and any reason and leave your employer in the lurch. Your employer also has the right to fire you at any time, and generally for any reason except those few reasons (like due to your sex or race) prohibited by law. Of course, it is very hard to prove that you were deliberately fired due to these factors, so basically you can be let go at any time, for any reason or no reason at all, and with no severance pay unless there is a state law on that. You might be able to retain your health insurance under the COBRA law, only if you can pay the full cost of the premiums while getting no income.

Right to work laws are simply snake oil wherein the state gives you the “right” not to pay union dues at the almost certain cost of a reduced standard of living and with a greater likelihood of sudden unemployment. If it were explained to workers this way almost no employees would want them.

The Walmart egg cracks at last

The Thinker by Rodin

Walmart protesters like me are cheering, somewhat tentatively. We are celebrating Walmart’s announcement this week that it is raising its starting wages. Walmart will boost starting wages to $9 per hour this year and it will raise them to $10 per hour by February 2016. $10 an hour is still not a living wage, but it is at least a start in the right direction. In addition, Walmart is changing policies to allow more predictive schedules for its employees, many of who are part time and many of who have to struggle their Walmart schedules with other job schedules. Employees will know more than two weeks in advance what their hours will be and when their hours will be. In addition, those desiring more hours will be able to request them. This good news is trickling up. Department managers will get a raise too, up from $13 an hour to $15 an hour.

So hip hooray, for Walmart, but certainly not a hip-hip hooray. Walmart has obviously been assessing the optics of its labor policies for a long time. Organizations like Making Change at Walmart have given widespread attention to their lagging wages, and the hassles and often brutish conditions that their employees endure. This included some strikes, sit-downs and walkouts, not to mention Black Friday protests such as I helped organize last year. It is quite likely that without these events there would have been no announcement this week from Walmart.

I have been focusing on Walmart’s unfair labor practices for many years because I believed it was where the fulcrum of labor change needed be applied. This is because it is the nation’s (if not the world’s) largest private employer. So affecting real change in Walmart was likely to have a nudging effect on all the other private employers out there. Indeed, that is the expectation. There is at least one Walmart in any community of size. $10 an hour may still not be a living wage, but when someone looking for a job has a choice between Walmart at $10 an hour and washing dishes at an Applebees at $7.25 an hour, they will go with Walmart. Walmart gets a richer set of potential employees to choose from. To compete at some point Applebees has to raise its wages too.

Unquestionably some of this is due to the improving economy. With the official unemployment rate at 5.8 percent and many disaffected people rejoining the labor market each month, the labor pool is tightening up at last. A number of employers have been proactive. Costco and Wegmans have long paid their starting employees a living wage and not coincidentally have prospered. Starbucks, Gap Inc., Hobby Lobby and IKEA have all seen this freight train coming their way and recently raised wages. Walmart then is something of a laggard. However, due to its size it has sent a signal that other employers must respond to or have their businesses put in peril.

I doubt that the bean counters at Walmart have figured this out, but raising their employees’ wages is good for their bottom line as well. Most likely much of the raises will be spent at Walmart. As starting wages are raised nationwide Walmart stands to increase sales, as they cater to value customers that come predominantly from the middle class, working class and poor. Happier employees are likely to be more productive as well, which means that Walmart’s notoriously poorly stocked shelves may be less so in the future.

It also means, however marginally, that money which would have otherwise gone toward the rich, where it is unlikely to be spent, will instead go toward the working class, where it will almost certainly be spent. In short, it will mean that the economy will grow more than it otherwise would have. Since the United States leads the world economy, our greater prosperity and our demands for goods and services will spur the world economy, the beginning of a virtuous cycle.

None of this should be news, but it may be to those who favor austerity. Walmart’s and all employers’ low wage policies are ultimately self-defeating. Low wages create high turnover and lower employee morage. Low wages do not build employee loyalty and give no onus for employees to be productive. Low wages make employees feel used instead of valued. It creates unnecessary conflict between employees and management and creates the conditions for labor to organize that employers don’t like. It taints businesses by projecting them as cheap, uncaring and harsh.

It also tends to stifle business creativity. Fast food restaurants like Chipotle are prospering by offering fresher, tastier, trendier and more natural foods. Chipotle’s simple use of a cafeteria line moves customers through more quickly and more cheaply while allowing them to pay employees more while needing fewer of them. In short, this makes them more productive and profitable. McDonalds, which has used the counter methodology for its more than sixty years in business, can’t seem to rethink its business model in such obvious ways. Clinging to tradition rather than embracing change is a major reason for their lackluster sales.

Employers that demonstrate that they value employees in the form of living wages set up a virtuous cycle wherein higher profits are a probable outcome of a generous corporate philosophy. Walmart is beginning to dimly grasp this but in fact this is what worked for American for most of the latter half of the 20th century. In truth, Walmart’s profitability is centered on its ability to treat its employees with respect through living wages and humane working conditions. Without employees it simply cannot survive. It needs to see its employees as invaluable and treasured assets, not as commodities. Living wages are the primary way to demonstrate this. Then Walmart may see sustainable increases in sales and profits again.

For women to actually get equal pay, the sun must shine in

The Thinker by Rodin

The stay at home mom is now almost legend. Women are at the cusp of being a majority of the workforce. One reason may be that women earn on average 77 cents on the dollar that men earn. All things being equal, that’s a considerable discount if you are an employer. Why wouldn’t you want to hire more women if you could pay them less?

Few believe that the wage gap is entirely due to sex discrimination. Women after all have babies, and this can inconveniently take them out of the workforce for a while. When they rejoin the workforce, often it is in a new position that comes with an entry-level salary. This is unfortunate but is not illegal. Many conservatives will argue that this alone explains the wage gap.

Traditionally fewer women have had college degrees than men. Now women form the majority of college students, so that suggests this will change in time. Some professions such as in science and engineering have traditionally been unrepresented by women, and these jobs often pay more than jobs on average, which might skew the average salaries higher for men. Still, hardly anyone who has studied the issue will dispute the assertion that some of the pay gap is due to sex discrimination. The discrimination may not be overt. It may simply be women setting their salary requirements too low and employers discreetly pocketing the savings. It’s also hard to ask for a fair salary when you don’t know what a fair salary is.

A lot of people resent sharing their salary information. It’s not hard to see why, as one of two things are likely. First, others will discover you are paid a lot more than they are for roughly the same work, which might engender feelings of hostility and resentment toward you. Second, you will realize others are paid considerably more than you while doing the same work, and that’s embarrassing. Regardless, employers can and do use the confidentiality aspects of salaries to their advantage. To truly get equal pay for equal work, this has to change.

But how? Who is going to want to disclose their salary when it engenders feelings of shame or anxiety? On the other hand, how can women have confidence that they are getting paid equivalent to a man without some disclosure?

The tools to find out how much your market wage should be are rudimentary at best. The Department of Labor keeps statistics on wage rates for a variety of professions, but of course wage rates will vary substantially depending on where you live and the local cost of living. The statistics are also highly bracketed. What you really need to know is what does someone in my profession, hopefully at the same company and at the same location, with similar time at the company and similar responsibilities earn? Companies are under no obligation to provide this information.

One way of course is to demand what you consider a fair salary and if your employer does not agree to it to quit. It helps enormously of course to have another job offer waiting before trying this. But it doesn’t necessarily tell you if your other offer is fair either.

I have a potential solution to the pay gap issue. What are needed are independent third-party labor assessors that would collect and verify pay data. Here’s how it could work.

Each community would have one person designated as an occupational salary and benefits assessor. I’m not sure how many would be needed, but let’s say it’s one person for every 10,000 employed people. Ideally the person would be funded by non-profit agencies, but it would also be reasonable for the person to be someone guaranteed to be impartial, such as a government employee, perhaps an employee of the Department of Labor, either for the federal government or for the state and county government. Their task is to make sure that there are no major pay discrepancies in various local companies based on categories that are clearly illegal, such as by sex. Employees could schedule meetings with their labor assessor to input their salary information, or send them documentation electronically on a periodic basis.

These labor assessors would need credentials of course and they would be sworn to maintain the confidentiality of information provided by an employee. The employee would provide the assessor with pay stubs and other related information so the information could not be faked. This might include employer 401-K contributions, employer pension plans, a resume of their work history, evidence of their certificates, diplomas, SAT scores and GPAs. Of course it would also be important to know key information like age of the person, time in job, their gender, their race, the position title, a description of their duties, etc.

The assessor would take the information, verify it, and put it into a database that would anonomize the employee’s information. The assessor may even have the duty to audit a particular company, particularly one suspected of practicing pay discrimination. Interviews would be done off site and perhaps in the privacy of someone’s home if needed. Periodically, perhaps annually, the employee would be asked to update information regarding salary, position and current job duties. It might even require compelling the employee to provide the information. I realize labor assessors could also demand the information from the company, but there is the possibility that an employer might lie or inflate benefits. It is better to get the information directly from an employee.

Eventually this would allow an understanding of how employees in similar skills and positions are paid within the same company. Perhaps the information could remain confidential and the employer could be given some time to rectify pay inequalities that are discovered. If that does not occur the bulk information could be publicly disclosed and if not corrected legal action initiated. This would move the feelings of shame from the employee, where they do not belong, to the employer, where they do belong. It would likely reveal other pay disparities that are illegal: perhaps disparities based on race, age or handicaps.

Lacking any of this, it is hard to see how the situation will change. This is because pay disparities will be purely anecdotal in almost all cases, given the lack of information. Given the undeniable fact that women in general tend to make much less than men, such a system could fundamentally transform pay fairness in the workplace, as well as increase the standard of living for tens of millions of women across the country.

If someone has a better idea, I’d like to hear it.

How to truly value labor

The Thinker by Rodin

Paul Ryan, former Republican vice presidential nominee and House Budget Committee chairman, has a new concern about Obamacare. It comes from a very selective reading of a new Congressional Budget Office report. The report noted that because Obamacare helps decouple health insurance from employment, some people who are working only because of their employer’s health insurance will quit and get their health insurance through a public exchange instead.

The CBO estimates that the equivalent of more than two million jobs will disappear over the next few years from employees who can now make this choice. Ryan said this means that Americans will “not to get on the ladder of life, to begin working, getting the dignity of work, getting more opportunities, rising the income, joining the middle class”. This is because, apparently, they will prefer sloth instead because they have the option of getting subsidized health insurance from the government instead.

Other Republicans leapt to inferences the CBO never said. The typical talking point became, “Obamacare will destroy more than two million jobs.” As if when people leave their job, employers won’t try to fill those jobs. By this logic anyone who quits their job is destroying jobs. Moreover, last I heard if you quit your job you won’t get free health care. You may be entitled to a subsidy if your income is low enough and if truly destitute and devoid of assets you could go on Medicaid. But that is hardly new. Moreover, employers may be entitled to government subsidies to provide health insurance to their employees. That’s part of Obamacare too. I guess a business could decide not to take these subsidies, but almost all that can will, because they like profits. I don’t see any Republicans referring to businesses that take these subsidies as freeloaders. But people who quit a soul sucking job apparently have no appreciation for the dignity of work and want to be bums.

Personally, I think it’s great when people quit their jobs. People don’t quit jobs they like. They quit jobs they hate. So Ryan could not be more wrong. People who quit a job generally expect to find a better and more fulfilling work somewhere else. If they thought otherwise they would stay in their current job. Obamacare increases personal freedom. Most likely everyone will be better off. Employers will get more productive employees that are more vested in their work and those who quit will be (or expect to be) in a happier situation.

As for the dignity of work being a personal value, it’s a curious argument for a Republican to make. Right now the situation is reversed. Government gives you incentive not to work, not through health insurance subsidies, but by allowing those with cash to invest their money and tax it at rates far less than the tax rates of labor. Capital gains mean nothing to most of us that are working. We may have retirement accounts with six or seven digits of value, and we still don’t care about capital gains. That’s because capital gains do not apply to our retirement accounts. When, in your geezerhood, you do take withdrawals from your Keogh or 401K, you won’t get a capital gains tax rate of 15% like those moneyed Wall Street types get for their non-retirement investments. That money will be taxed as if you worked to acquire them, i.e. earned income. Only those with liquid assets available for investing outside of retirement accounts can take advantage of those low capital gains tax rates. Others like me are taxed at a considerably higher rate because we work and make a good wage. In my case, I am in the 25% tax bracket. As I noted before, others like Mitt Romney don’t work at all, are filthy rich and are in the 15% tax bracket because their income is almost all from capital gains.

If the dignity of work is now an important Republican value, then how about making work pay? People working at Wal-Mart or McDonalds apparently cannot survive on their wages. Many of these people would be malnourished or homeless if they were not getting food stamps or in some cases public housing. If they could survive without government handouts and actually be able to acquire some modest savings and live in their own place, maybe they would feel dignity and value. But many employers don’t care about their dignity or value because they won’t pay them a living wage. What does that say about how employers value labor? Government could set a living wage floor that actually was a living wage. Low income workers would have more money in their pockets and would likely spend most of it, increasing economic activity. Having dignity in your work implies that you can be self-sufficient from your labor. Low wage jobs appear to have the opposite effect.

And if work should be valued, shouldn’t it be valued at least as much as investment income? Unless you inherit wealth, it takes a heap of high-paid labor to acquire surplus funds to invest outside of your retirement. The argument for low capital gains tax rates was to spur economic growth. That doesn’t seem to be working so well, as evidenced by our anemic economy and the high unemployment rate.

So this argument about the dignity of work is one of two things: rhetoric or, if sincere, it should be a call to action for society to put its money where its mouth is. This can be done by requiring employers to pay a living wage and by increasing capital gains tax rates to at least be at parity with income tax rates. Arguably, capital gains and dividends should be taxed at rates higher than labor. It would demonstrate that we truly value labor.

But you already know the answer to the argument: it’s rhetoric. Republicans like Paul Ryan don’t give a damn about the dignity of work or pretty much anyone not in their socioeconomic class and who does not share their values. For those of us in the working class, there is only one appropriate response and it involves lifting your middle finger to these hypocritical assholes.

Why is my tax rate higher than Mitt Romney’s?

The Thinker by Rodin

Mitt Romney, the likely GOP nominee for president, is not sure but he thinks his tax rate was fifteen percent last year. We may or may not know in April when he may or may not release his tax returns for 2011. While we may or may not know his 2011 income and taxes, he seems much more reluctant to release tax returns for previous years, particularly when, you know, he was raking in the mega millions working for Bain Capital, where he made his fortune.

Mitt wants you to know his tax rate was probably fifteen percent last year because it was almost all unearned income, principally interest and dividends on his investments. This is, after all, a guy who says he knows the pain of unemployment because he is also unemployed. He says that he did have some earned income in 2011, mostly speeches, but it was “only” $374,000 dollars or so.

Poor guy. It’s a good thing he doesn’t have to live off just his earned income. Imagine his suffering! First of all, that would place him in the 33% tax bracket (35% is the maximum), which it might mean that instead of flying first class he might have to fly business class. By the way, his 33% tax rate doesn’t mean he paid 33% tax on all of that $374,000. First of all, taxable wages would be considerably less than $374,000, but he would only pay 33% on taxable income over $212,300. Income below this threshold would be taxed at a lower rate. In fact, for his first $17,000 in income, he would only pay a 10% income tax, just like me.

Unsurprisingly, my family does not come close to making $326,000 in earned income, but we are reasonably well off. Curious to see how I compared with Mitt, I pulled my 2010 income tax form. My wife and I fall into the 25% tax bracket, since our taxable income in 2010 was $104,345. Which means that Mitt Romney, whose net worth is estimated at between $190 and $250 million, is taxed at a lower rate than my wife and I. Ten percent lower, in fact.

Just for the record, I am releasing my tax returns (well, the first two pages, which is enough), which Mitt won’t do. Naturally I am obscuring some personal information, but as you can see we paid $16,589 in federal income taxes, after some substantial deductions and credits, on an adjusted gross income of $142,642.

If you want to understand why the 1% are doing so well and will continue to do well, it’s there is a nutshell. Essentially those who work are required to pay proportionally more of their income in federal taxes than those who don’t, at least if your taxable income is $17,000 or more (using 2011 tax rates). And $17,000 a year is essentially living in poverty.

Since Romney has not released his tax returns, we can only speculate about whether he is a shrewd investor or not. Most likely since he spends most of his time campaigning, he is not paying much attention to his stocks and mutual funds. It is unlikely that he is carefully moving his assets around from less productive companies to more productive ones, so that he can build wealth and presumably reward innovation in the economy. Most likely his funds stay largely the same from year to year, or he hires some smart person to manage his funds for him. In any event, regardless of how much he does or does not make on his investments, he pays just 15% income tax on that portion that is over $17,000, and none of it is earned. Presumably he is getting at least 5% interest on his portfolio, so probably this income amounts to no less than $10 million a year in interest and dividends, on which he pays no more than $1.5 million of that in federal income taxes.

Whereas I work forty or more hours a week, plus teach a class at a community college for some spare change, plus earn a couple grand with an online business I have. And my tax rate is 25% on taxable income over $69,000.

So if you have wealth you can effectively do nothing and pay less taxes as a percent of your income than someone whose source of income is likely almost completely earned and who makes more than $17,000 a year. Is America a great country, or what?

Yes, this is a great country, for those with wealth. It’s pretty clear why: because the rest of us subsidize their wealth. It’s not too surprising, if you think about it, that the wealth gap started growing almost as soon as we dropped taxes on capital gains and interest below top tax rates for income, which began during the Reagan Administration. The gap is currently twenty percent: with a top earned income tax rate of 35% vs. a top unearned income tax rate of 15%. To put it another way, unearned income is worth up to 233% more than earned income because it discounts your taxes by that much.

Supposedly this policy incentivizes capitalism. It’s proof that the fictional Gordon Gekko was right when he uttered, “Greed is good”. It certainly made him and people like Mitt Romney rich, but it’s clear that the money actually came from somewhere else. In the case of Bain Capital, it often came at the expense of shareholders in failing companies and workers who at best were asked to take a “haircut”, got stiffed on their pensions and/or found themselves out of a job. The plain facts are though that more of the costs of society are being borne by those who have a harder time paying for them. It’s not too surprising then that the wealth gap grows and more and more wage earners are falling out of the middle class. Their value has been discounted.

At a minimum, I believe that unearned income should be taxed at the same rate as earned income. This at least sets parity between these two forms of income. Most of us though intuitively understand that value added through the sweat of one’s brow should be valued more than income generated from having capital alone. All value begins with a human being making some physical change to the real world. If anything, these tax rates should be reversed and unearned income should be taxed higher than earned income.

Regardless of who wins the presidential contest this year, this inequity isn’t likely to be rectified, but it sure won’t happen if you elect Mitt Romney for president. Instead, you can expect that government for and by the wealthy will continue, and your vote for Mitt will be instrumental in ensuring that the value of your labor will continue to decline.

Bum deal in Chicago

The Thinker by Rodin

The city of Chicago provides my other story epitomizing what is wrong with today’s America. Unlike the death of a Wal-Mart employee by stampeding customers, which largely got lost in the news, this story at least got some attention. It deserves more.

More than half a million Americans lost their jobs in November alone. So perhaps the plight of just two hundred employees at Republic Windows & Doors in Chicago does not matter. Unlike most of America, which is not unionized, Republic Windows & Doors is a union shop. Its workers belong to the United Electrical, Radio and Machine Workers of America. Supposedly, in the event their employer goes under, the Worker Adjustment and Retraining Notification Act makes their job losses less painful. This law requires that covered employees, in most situations, must get sixty days of notice before a layoff or sixty days of salary.

They got only three days because Republic Windows assumed it would get credit that it did not receive. They requested credit from their creditor, The Bank of America. Ironically, Bank of America recently received $25 billion courtesy of the American taxpayer because it was having a financial crisis of its own from foolishly investing in sub-prime mortgages. However, Bank of America summarily refused to extend any of that credit to Republic Windows. With no money to draw from, Republic Windows felt it had little choice but to shut down promptly. It provided its workers just three days notice before closing the factory. Employees received no severance pay.

Probably because its workforce is unionized, the uppity employees of Republic Windows decided that, gosh darn it, they were entitled to the benefits due them under law! They occupied the plant (with the grudging approval of management, who said they could only do so if they kept the equipment in good order) while others protested outside the factory and tried to draw media attention.

It is unlikely that these employees would have fought their situation if they were not unionized. Only 12% of the American workforce today is unionized. With a union behind it, employees had a ready structure in place to stand up for what was lawfully due them. Chicago is also a heavily Democratic area and one of the more unionized areas of the country. (Indeed, Chicago features prominently in the union movement, which makes the location of this incident particularly appropriate.) It took a few days but their cause drew some media attention. Recently indicted Illinois Governor Rod Blagojevich was among a small number of politicians who rallied for the union workers. Even President-Elect Obama came out in support of these union workers. (Unsurprisingly, there was no similar statement from President Bush.)

All this publicity is beginning to show some results. Bank of America reluctantly joined talks with Republic Windows and the union. Talks are still underway and if press reports are to be believed, Bank of America reluctantly suggested it could lend Republic Windows enough money so it could pay its employees’ claims. Another bank, JP Morgan Chase reportedly is also offering a loan of $400,000. It is even possible, with the heat it is under and with the inconvenient fact that it took $25 billion in tax dollars, Bank of America may extend all the credit needed so that Republic Windows can stay in business. I hope that in this situation its employees retain their jobs that seemed certainly lost. If so, it will only be due to their backbone to protest loudly and vigorously.

Bank of America, like many troubled lenders, eagerly took taxpayer money. Unbelievably, it was never required by the government to use the money to issue loans. That’s right, our government was so incompetent (or devious) that it issued hundreds of billions of dollars to lenders with no requirements that they use the money to address the credit needs of the employees and businesses that were fueling the recession. Bank of America, like most banks taking the handout, seems more concerned with its own profitability and solvency than in lending money.

As this situation proves, lack of money can triumph over rule of law. If a company has no money to live up to its requirements under law, apparently it feels it can walk away from them. That seems to be the case with Republic Windows, although it is a fair question to ask how they could pay severance if they did not have the money to do so.

In today’s America, labor is simply not valued. It has been this way for decades, but the problem now has becomes more obvious with our major economic downturn. Good, decent and hardworking Americans get to take it on the chin with nary a thought for their financial plight. Rather, employees are routinely treated like a drunk tossed out on the street. One day management smiles at you and then next you are as valuable as used toilet paper. However, because they are unionized, workers at Republic Windows could fight back.

The Republic Windows protest may be (I hope) the catalyst for real labor reform. Our new president is sympathetic to unions. In addition, it appears that a larger Democratic congress will enable passage of the Employee Free Choice Act into law. This urgently needed law will go a long way to leveling the playing field, that has given management the upper hand in labor negotiations.

In the long term, expanded workers’ rights are probably in business’s interest too. We cannot sustain the economy forever with an American middle class that continually shrinks and loses income every year. Generally, workers are more productive when they feel vested in their jobs. Employees who have to continually worry they can be thrown out on the street at any moment are likely to be skittish and disloyal to those they work for.

In any event, it is nice for a change to see workers stand up aggressively for their rights and get some results, even if it still means they lose their jobs. At least they should get the severance lawfully due them. Our nation is a country of laws. This case demonstrates that it is important that the law should be not just respected but also actually followed. I hope workers everywhere are watching and learning. Workers deserve a fair deal again. We deserve better treatment than the shabby way we are often treated by employers today. What happened in Chicago is Dickensian. We are human beings, not rubbish to be discarded the moment it becomes convenient for an employer.