Leading American economists: Employee Free Choice Act key to rebuilding economy | National Union of Public and General Employees

Leading American economists: Employee Free Choice Act key to rebuilding economy

Passage of the Employee Free Choice Act is critical to rebuilding our economy and strengthening our democracy

(20 March 2009) – More than three dozen of the America’s top economists has signed a statement calling on the US Congress to pass the Employee Free Choice Act as a way to help restore the US economy to work for everyone and ensure that it is built on a sustainable, wage-based growth.

The statement, signed by 39 of America’s top economists including two Nobel Prize winners, points to the failure of U.S. labour laws to protect employees’ freedom to form a union and bargain as a major factor in our economic crisis. It was published as a full-page advertisement in The Washington Post on February 27.

The statement noted that from 2000 to 2007, the income of the median working-age American household fell by $2,000—an unprecedented decline. In that time, virtually all of the nation’s economic growth went to a small number of wealthy Americans. An important reason for the shift from broadly shared prosperity to growing inequality is the erosion of workers’ ability to form unions and bargain collectively.

The economists, representing respected universities and policy institutions from across the nation, point to the corporate-dominated system for forming unions—and the coercion and anti-union campaigning by management—as the causes for declining wages and a gravely weakened economy.

A rising tide lifts all boats only when labour and management bargain on relatively equal terms. In recent decades, most bargaining power has resided with management. The current recession will further weaken the ability of workers to bargain individually. More than ever, workers will need to act together.

Although current headlines are dominated by the crises in the stock market and the financial sector, working families have been struggling for years under the weight of an unbalanced economy. The economists say that restoring bargaining power and ensuring working people have a voice in their workplace, and in their health care, pensions and wages, is critical to rebuilding our economy.

James K. Galbraith of the University of Texas, one of the economists who have signed on, says the freedom to form unions and bargain has many benefits for the economy and the country.

“I support the Employee Free Choice Act for two reasons. First, it levels the playing field after a generation of anti-union policies, and in a world where far more workers are in decentralized, hard-to-organize workplaces than was true a generation back. Second, unions are a proven ally of progress, not only in politics but also in economics: unionized workforces promote technical change and productivity growth, because they make it possible to distribute more fairly and less brutally the costs of change.”

Eileen Appelbaum of Rutgers University stated, “To get our economy back on track and growing again we need to strengthen wages, make sure that workers have health and retirement benefits, and reduce inequality. Unions play a unique and significant role in achieving equity and efficiency in the workplace and, more broadly, in society.”

More information: Passage of the Employee Free Choice Act is critical to rebuilding our economy and strengthening our democracy

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