February 2019 Archives

    On March 9, 2015, Wisconsin Gov. Scott Walker signed into law a measure that prohibited unions from requiring non-union members for whom they bargained to pay agency fees, striking another blow against organized labor four years after the state effectively ended collective bargaining for public-sector employees. The new law, effective immediately, made Wisconsin the 25th right-to-work state and the first to do so since Michigan and Indiana enacted similar laws that were intended to hobble the ability of employees to bargain collectively for wages and for better working conditions. 

Mark Mix, president of the National Right to Work Committee, claimed the action then put pressure on other Midwest states to follow suit.  "Every worker deserves freedom of choice when it comes to union membership and dues payment, and if states like Michigan and Wisconsin can pass Right to Work then Illinois, Minnesota, Missouri and Ohio can too," Mix stated.

            Mix's professed concern for the freedom of workers is little less than disingenuous propaganda since the economic evidence and historical record show that "right-to-work laws" have significantly weakened unions, and that the decline of a viable labor movement is  inextricably linked to rising economic inequality among Americans. As employers inevitably engage in a collective "race to the bottom" the ability of employees to negotiate and demand higher wages and better conditions for work declines. 

As of 2018, twenty-four states had agency fee requirements for public employees. While 28 states have so-called right-to-work laws that prohibit mandatory agency fees, Wisconsin and Michigan had exceptions for police officers and firefighters that permit agency fees covering those workers. In those right-to-work states, unions still represented workers but membership rates were significantly lower. Agency fees, paid by public-sector workers who decline to formally join their unions, provided millions of dollars annually to unions. The loss of that revenue further weakens the power of unions to create better working conditions and to improve the standard of living for employees. 

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The unremitting war against unions and the right of employees to bargain collectively for better compensation and working conditions has remained under attack by a well-funded and orchestrated cabal of right-wing pro-business groups since the end of the New Deal. In 1977, the U.S. Supreme Court decided Abood v. Detroit Board of Education. In a unanimous decision, the Court affirmed that the union shop, legal in the private sector, was also legal in the public sector. The Court held that non-members may be assessed agency fees to recover the costs of "collective bargaining, contract administration, and grievance adjustment purposes" while insisting that objectors to union membership or policy may not have their dues used for other ideological or political purposes.  

In the 2018 term of the U.S. Supreme Court that decision was contested anew. In Janus v. American Federation of State, County and Municipal Employees, the Supreme Court agreed to consider - for the second time in two years -a suit brought by anti-union groups. The nominal plaintiff, a disgruntled social worker in Illinois, challenged the legality of fees that workers who are not members of unions representing teachers, police, firefighters and certain other government employees must pay to help cover the costs of collective bargaining with state and local governments. Janus' lawsuit was funded by The National Right to Work Foundation which  is part of a right -wing network funded by corporate billionaires and ideological opponents of unions. 

In Abood as well as in Janus, the plaintiffs argued that requiring them to pay agency fees to unions whose views they may not share, violated their rights to free speech and free association under the First Amendment to the U.S. Constitution. Ironically, two prominent conservative law professors, Eugene Volokh and William Baude, had previously debunked that argument as nonsensical. In an amicus brief that they submitted on behalf of the AFSCME, they argued that even Abood was wrongly decided: "Where Abood truly went wrong... was not in how it applied the new First Amendment objection it recognized. Rather, Abood erred by recognizing that objection in the first place. Compelled subsidies of  others' speech happen all the time, and are not generally viewed as burdening any First Amendment interest. The government collects and spends tax dollars, doles out grants and subsidies to private organizations that engage in speech, and even requires private parties to pay other private parties for speech-related services--like, for example, legal representation. To be certain, these compelled subsidies are subject to other constitutional restrictions. For example, the government cannot compel payments that violate the First Amendment's Religion Clauses or the Equal Protection Clause. But a compelled subsidy does not itself burden a free-standing First Amendment interest in freedom of speech or association." 

For their part, the unions contended that mandatory agency fees were needed in order to eliminate the problem of what they call "free riders" - non-members who enjoy the benefits of union representation i.e. - such as increased compensation and better working conditions obtained in through collective bargaining -  while simultaneously refusing to pay for the costs of that representation. In addition, depriving unions of agency fees could thwart their ability to spend money in political races. Historically, because of the long-standing antipathy of the GOP to unions, unions have endorsed and supported  Democratic candidates.

In 2016, the Supreme Court considered a similar case, and after hearing arguments appeared poised to overturn a 1977 Supreme Court precedent, but the death of conservative Justice Antonin Scalia the following month left the court with an even split of conservatives and liberals, and its 4-4 ruling in March 2016 did not resolve the legal question. Republican President Donald Trump's appointment of Justice Neil Gorsuch in 2017 restored the Supreme Court's 5-4 conservative majority. In the spring of 2018, after the appointment of Neil Gorsuch, by a vote of five to four, the Supreme Court's reactionary majority sided with the plaintiff and, in reversing the Abood decision, held that even the collection of agency fees by public sector unions violated the First Amendment rights of employees who opposed unions.   

"This case is about power," American Federation of Teachers President Randi Weingarten said. "The funders of this case want a new Gilded Age, this time on steroids," Weingarten added, referring to a period in the late 19th century known for its concentration of wealth among industrialists.

The union membership rate among public-sector workers was nearly 35 percent in 2017, more than five times higher than the unionization rate for workers in the private sector, U.S. Bureau of Labor Statistics figures show. Taking away mandatory agency fees could have profound implications for public-sector union coffers. Unions in New York state, for example, 

would lose an estimated $110 million per year without mandatory fees from non-members, according to the business-backed Empire Center for Public Policy.  The loss of this revenue to unions would be especially damaging since unions have historically been the agents that have promoted a higher standard of living, income equality, job security, and equal treatment of all employees in the workplace.  

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The private sector analogue to Janus v. AFSCME is Epic Systems v. John Lewis, a series of cases that U.S. Supreme Court also decided in its 2018 term. The employees in the Epic cases complained that their employers underpaid them in violation of the wage and hour provisions of the Fair Labor Standards Act of 1938,  and that, under §7 of the National Labor Relations Act,  they were entitled to engage in concerted action - such as class action arbitrations -  to vindicate their rights.

Supported by the U.S. Chamber of Commerce and a virtual smörgåsbord of right-wing funded institutions and "public interest" groups with deliberately deceptive names such as the Equal Employment Advisory Council, as well as by the Trump administration, the plaintiffs in Epic argued that the Federal Arbitration Act - that was passed in 1925 - should be construed to ignore and override the statutory provisions of the National Labor Relations Act. 

The NLRA, which was passed in1935 during the New Deal, was enacted to counter widespread strikes and labor violence between employees  - who were denied the right to organize and to bargain collectively - and business owners. These workers and their families were also often the victims of thugs and special police hired by employers. Many others were required as a condition of their employment to sign "yellow dog" contracts - agreements between workers and employers in which the employees - who lacked equal bargaining power - agreed not to join or support a union.  

 

The NLRA, at 29 U.S.C.  §151 -"Findings and declaration of policy" - explicitly states "[I]t is hereby declared to be the policy of the United States to eliminate the causes of certain substantial obstructions of the free flow of commerce ...by encouraging  the practice and procedure of collective bargaining..." In response to the plaintiffs' claims, the unions replied, "The right to engage in  concerted protected activity is ' a bedrock principle of federal and policy' that has repeatedly been invoked by the Board and the courts over the past eight decades....Just as an employer cannot deprive its workers of that substantive statutory right by insisting that they agree to arbitrate all workplace disputes instead of picketing, striking, or engaging in any other form of legally protected protest activity, neither can it opt out of the core, substantive worker-protected right established by Norris-LaGuardia and the NLRA by requiring workers to prospectively waive their statutory right to improve workplace conditions through collective adjudication."

At issue in Epic was the question of whether employers could, as a condition of employment, require employees to sign arbitration agreements that require them to submit all work-related disputes to individual arbitrations, contrary to §7 of the National Labor Relations Act; irrespective of whether they belonged to unions; and irrespective of whether existing negotiated collective bargain agreements required that work-related disputes be adjudicated between the unions, as the freely -chosen agents of the employees, and the employers through the grievance and collective arbitration process.  

In another five-to-four decision, writing on behalf of the Court's reactionary majority, Justice Gorsuch ignored the well-established canons of judicial interpretation, the unambiguous legislative history of both acts , and the plain wording of the Federal Arbitration Act. As Justice Ginsberg noted in her dissent, the Federal Arbitration Act was explicitly passed to provide a forum to resolve disputes among merchants, not disputes involving workers who are explicitly excluded from the act. By contrast, the National Labor Relations Act and its immediate predecessor, the Norris-LaGuardia  Act, were passed to guarantee the rights of all employees to organize unions, to bargain collectively to improve wages and working conditions, and to engage in collective actions to achieve those and related ends.   

     

The decision in Epic Systems may very well spell the death of organized labor in the private sector and will harm millions of Americans who work for wages, whether they belong to unions or not since they would now be reduced to the status of indentured servants.

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              The labor history of the United States in the nineteenth century and the first three decades of the twentieth century was often violent and bloody. Most state courts treated labor unions and strikes as illegal conspiracies in restraint of trade and labor organizers and striking union members were regularly arrested, imprisoned and often shot by Pinkerton detectives,private militias raised by employers, and National Guard soldiers who were mustered into service by business-friendly governors in many states.

              Ever so slowly, the tide began to turn. In the 1930s, as the effects of the Great Depression became more pronounced, industrial unionism, organized under the auspices of the Congress of Industrial Organizations (CIO), emerged. With the enactment of the National Labor Relations Act in 1935, the right of all workers "to organize and bargain collectively through representatives of their own choosing" was pronounced for the first time to be national public policy. Other New Deal legislation included the Walsh-Healey Government Contracts Act, which required the payment of prevailing wages on government contracts in excess of $10,000; the Railroad Retirement Act; and the Fair Labor Standards Act of 1938, which provided for the first time, with certain exceptions, a nationwide minimum wage floor and maximum workweek of 40 hours per week within three years of its enactment date.

            Courageous individuals such a Bill Haywood, Mother Jones, Eugene Debbs, John L. Lewis, and Walter and Victor Reuther, among thousands of others, struggled to secure social and economic justice for American workers. Organized labor brought to America the right to grieve mistreatment in the workplace, "just cause" termination standards, the eight hour day, weekends off, overtime and rest break regulations, workers' compensation, unemployment insurance and pensions. 

            Since the 1940s, the American labor movement has been forced into retreat. After the death of Franklin Roosevelt and the election of a Republican Congress in 1946, right-wing liberalism and laissez-faire economics one again became resurgent. The first great success of New Deal critics was achieved with the enactment of the Taft-Hartley Act in 1947, that was passed over President Truman's veto. The effect of this legislation was to outlaw "closed shops" and to permit individual states to allow "open shops"--i.e. shops in which elected unions could not require all of the employees to belong to the unions, irrespective of whether the non-union employees also received and enjoyed the benefits of collective bargaining.

            As a result of that legislation, corporations began an inevitable migration to the South where welcoming state legislatures hastily enacted "right-to-work" laws. The migration of these manufacturing companies away from the unionized urban centers of the Midwest and North left hundreds of mill towns impoverished and desolate, and the union movement, over time, has been effectively eviscerated.

            By January, 2018, the number of wage and salary workers belonging to unions stood at  14.8 million in 2017, which was an slight increase of 262,000 from 2016. In 1983, the first year for which comparable union data are available, the union membership rate was 20.1 percent and there were 17.7 million union workers.  

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Many non-union employees still do not seem to understand that their ability to influence working conditions and wages, as solitary individuals who lack comparable bargaining power with managers and owners of business, is virtually nil. Apparently, however, the myth of the autonomous, self-made individual who can receive recognition, remuneration and advancement solely by dint of one's own hard work continues to resonate in the workplace to the present, notwithstanding all of the evidence to the contrary. 

This myth now resonates at the top level of the federal government as Andrew Puzder, a fast food executive and opponent of minimum wage and other labor laws, was chosen by Donald Trump to become the Secretary of Labor. A fierce critic of government regulation and an Ayn Rand enthusiast, Puzder has expressed a preference for automation in the workplace. As he noted, machines are much easier to deal with than humans: "They're always polite, they always 

upsell, they never take a vacation, they never show up late, there's never a slip-and-fall, or an age, sex, or race discrimination case."

            Even among the few unionized workers still employed in manufacturing, downward economic pressures have forced many unions to acquiesce to a two-tier pay system imposed by management: younger workers now make substantially less per hour than more senior employees who perform the same work. The effect of this two-tier system denies younger workers upward mobility and divides workers based solely upon dates of hire: "The changing job market is undercutting entry-level wages for those who do not go to college. In the 1960s and 1970s, you saw high school graduates getting good jobs at Ford and AT&T, jobs that in inflation-adjusted terms were paying $20 or $25 in today's wages," said Sheldon Danziger, a professor of public policy at the University of Michigan. "Nowadays most kids with just high school degrees will work in service-sector jobs for $10 or less..."

                                          

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The decline of unions explains in large part why wages have remained stagnant for  decades. As the power of unions has eroded, companies have gained the upper hand and are able to unilaterally dictate to individual employees the terms and conditions of their employment. A survey conducted by Evan Starr, a management professor at the University of Maryland, found that one in five employees in the U.S. were subject to non-competition agreements in 2014.   Matthew Marx, a professor at M.I.T's Sloan School of Management, found that employers typically present  workers with  non-compete contracts when the employers lacked negotiating leverage. The use of  non-competition agreements has been expanded to restrict the ability of even low-wage workers to accept successor employment at "competitors" for higher wages in a wide range of jobs from sales to technical services.

Besides non-competition agreements, many companies have increasingly used their economic clout to impose non-poaching agreements that eliminate or severely restrict the ability of franchisees to hire workers from other locations within the same franchise. The "non-oaching"  agreements are widespread among franchises as diverse as  Burger King, H.R. Block and Jiffy Lube, among others. 

Eric Posner and Alan Krueger have pointed to the existence of  non -competition and anti-poaching agreements as evidence of  "monopsony power." The term is used by economists to describe the ability of an employer to suppress wages below the efficient or perfectly competitive level of compensation. This is done  through the use of non-compete clauses and non- poaching agreements that are aimed at the most vulnerable workers.

As Posner and Krueger note, "The studies show that common features of the labor market give enormous bargaining advantages to employers. Because most people sink roots in their communities, they are reluctant to quit their job and move to a job that is far away. Because workplaces differ in terms of their location and conditions, people have trouble comparing them, which means that one cannot easily 'comparison shop' for jobs. And thanks to a wave of consolidation, industries are increasingly dominated by a small number of huge companies, which means that workers have fewer choices among employers in their area." They conclude that, ''When employers exercise monopsonistic power, wages are suppressed, jobs are left unfilled, and economic growth suffers. Unions used to offset employer monopsony power, but unions now represent only 7 percent of the private sector."

             Harold Meyerson has described the correlation between union membership and economic equality in article in the American Prospect in 2012. He observed that "From 1947 through 1972, productivity in the United States rose by 102 percent, and median household income rose by an identical 102 percent. In recent decades, as economists Robert Gordon and Ian Dew-Becker have shown, all productivity gains have accrued to the wealthiest 10%. In 1955, near the apogee of union strength, the wealthiest 10 percent received 33 percent of the nation's income. In 2007, they received 50 percent."  

            Colin Gordon, a Professor of History at the University of Iowa, has argued that "One hallmark of the first 30 years after World War II was the 'countervailing power' of labor unions (not just at the bargaining table but in local, state, and national politics) and their ability to raise wages and working standards for members and non-members alike. There were stark limits to union power--which was concentrated in some sectors of the economy and in some regions of the country--but the basic logic of the postwar accord was clear: Into the early 1970s, both median compensation and labor productivity roughly doubled. Labor unions both sustained prosperity, and ensured that it was shared."

The pervasiveness of anti-union bias remains so potent in right-to-work states and so ingrained in the false consciousness of its citizens that, as recently as February 2017, Boeing employees in South Carolina voted against their own best interests. The National Labor Relations Board announced  that 74 percent of the 2,828 workers cast ballots voted against joining the International Association of Machinists and Aerospace Workers (IAM).  In a statement, IAM lead organizer Mike Evans said: "We're disappointed the workers at Boeing South Carolina will not yet have the opportunity to see all the benefits that come with union representation."    

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          The mythology behind "right-to-work" laws and companion efforts have largely succeeded in gutting this country's labor laws but they have produced results quite different from the economic theory their proponents endorse. As Isaiah Berlin sagely noted, "Freedom for the wolves has often meant death to the sheep."  In a world of unrestrained competition, only the few, the wealthier, the more powerful, the more resourceful, the better educated, the more mobile, will be able to maximize their opportunities; everyone else gets left behind or becomes "road kill."

If unregulated market economies are the answer to economic progress, as corporate CEOs and their lobby of sycophants and enablers insist, how then does one explain the implosion of Wall Street and the related financial scandals that destroyed trillions of dollars of wealth possessed by ordinary Americans?  Conversely, if government regulation of the economy is the problem, how do we explain the growing economic inequality in the U.S? Why is it that, despite what right-wing libertarians claim is a confiscatory tax code, the wealth of the top 1% continues to grow exponentially?

  Massachusetts Senator Elizabeth Warren has been criticized by the Republican noise machine and its right-wing media outlets for stating the obvious: that each of us has depended for our success, to some degree, upon the help, assistance and inspiration that we received from others. Further, she has emphasized the obvious: that public goods - rail, road and airport infrastructure, public education, government support for R&D, public health, food and safety regulation, environmental regulation,  civil rights protection, consumer protection, anti-trust regulation, protection of intellectual property - are essential  prerequisites for economic success. Consider, for example, the rewards reaped today from the government funding and research to create satellite/GPS technology and the internet.

  Market economies are affected by the frailties and foibles of human actors. Many of these actors are motivated by selfish, short-sighted concerns; but the consequences of their actions harm everyone. It is for that reason that regulation in the public interest and investment by the government - as the agent of the people in a democracy - are essential antidotes to the temper the excesses of capitalism and to create the foundations for a truly just society.

The continued clamor to reduce public regulation and investment is a siren call that is orchestrated by corporations and the wealthy elite who want free reign to continue to game the system. Ordinary citizens need to resist that clamor and to understand that their true, long-term interests have little in common with the interests of the top 1%.  As Nicholas Kristof reminds us "If you're infatuated with unfettered free markets, just visit Waziristan." 

During Superbowl LII, on February 5, 2018, E-Trade ran a commercial that depicted elderly life guards, fire fighters and disc jockeys' struggling on the job and singing, "I'm 85 and I want to go home" to the tune of Harry Belafonte's "Banana Boat."  The ad correctly noted that over one third of Americans aren't saving any money for retirement. 

Roberta Gordon is a case in point. In an interview with The Atlantic, she stated that she never thought that she would still be alive at age 76 and, if she were, she didn't think that she would still be working. Now, she spends every Saturday at a grocery store and hands out samples for which she is paid $50 a day. She states that she needs the money. Throughout her life, Gordon worked dozens of odd jobs  -  as a house cleaner, a home health aide, a telemarketer, a librarian, a fund raiser. Often, however, she didn't have steady job with an employer that  paid into Social Security and she doesn't receive a pension. Gordon states that she earns $915 a month through Social Security and through Supplemental Security Income, or SSI, a program for low-income seniors. Her rent is $1,040 a month and she's been forced to take on credit-card debt to cover the gap, and to pay for utilities, food, and other essentials. She often goes to a church food bank for supplies. 

  Ms. Gordon plight is typical of many Americans who have struggled throughout  their lives to make ends meet, but E-Trade's invitation to invest with it is no solution to their travail. 

From 1940 to 1960, the number of American workers in the private sector by traditional pension plans increased from 3.7 million to 19 million, or to nearly 30 percent of the labor force, according to the Employee Benefit Research Institute, or EBRI, and by 1975, 103,346 plans covered 40 million people.  By the early 1970s, many of those retired workers in the United States who were the beneficiaries of traditional pension plans were able to enjoy a comfortable retirement for themselves and their spouses in contrast to the impoverished experiences of previous generations of retirees. Their pensions were supplemented by Social Security benefits that were enacted in the New Deal, and were greatly augmented  by the medical coverage provided by Medicare which was enacted as part of President Lyndon Johnson's Great Society legislation.  

By 2014, only 15% of retired workers in the private sector were enrolled in defined benefit plans. By contrast, many of the defined contribution plans that the Employee Retirement Income Security Act of 1974 [ERISA} permitted employers to create provide retirees with benefits are based on the amount and investment performance of contributions made by the employee and/or employer over a number of years. Many of those401K plans make minimal contributions to their employees and opt to pay benefits in a  lump sum rather than as a lifetime pension. 

The key event that precipitated a clamor for pension reform occurred in 1963 when the pension plan of the South Bend, Indiana-based car manufacturer Studebaker Corporation  collapsed because of the company's bankruptcy. That event led in a 10-year Congressional effort to enact federal legislation to regulate pension plans. That effort - which was largely shaped by  the lobbying efforts of banks and money managers  -  culminated in the passage of , ERISA. ERISA, amended several times since, ostensibly requires companies to adequately fund their pension plans and mandates that workers vest their pension benefits after a minimum number of years.

Ostensibly, ERISA was enacted to create minimum national standards for pension plans in the private sector.  At the time it was enacted,  a majority of employees were enrolled in traditional pension plans - aka defined benefit  plans. Under those plans, many of which were joint union-employer pension plans, the trustees and administrators were held to a fiduciary duty to exercise prudent judgment to protect the assets invested on behalf of the covered employees.

At the behest of the financial industry, ERISA permitted the creation of defined contribution plans - individual  retirement plans - e.g. 401Ks, etc. Such plans are ultimately controlled by plan administrators and asset managers whom ERISA conveniently exempted from any fiduciary duty to act in the best interests of the employees whose assets they managed.  As a result of ERISA, a majority of American companies abandoned traditional pension plans during the past five plus decades and opted to create defined contribution plans, most of which significantly reduced the employers' financial responsibilities to contribute to their employees retirement plans.  

Subsequent legislation amended ERISA and increased the responsibilities of Employee Benefits Security Administration ( EBSA), including the creation of the Pension Benefit Guaranty Corp. In 2009, that agency guaranteed payment of basic pension benefits earned by 33.6 million workers and retirees participating in about 27,650 single-employer pension plans, according to the EBRI. And in 2010, the agency was paying benefits to 1.3 million workers from 4,140 terminated plans.

The overall effect of ERISA has been an unmitigated disaster for ordinary employees and their families. Historically,  long-term employees in the United States who retired after 30 or 40 years at a company received pensions with a guaranteed lifetime income stream.   By contrast, those who own 401(k)s and individual retirement accounts - defined contribution plans - are burdened by two impossible-to-control risks: stock market volatility and uncertainty about their own longevity.

As the 2018 E-Trade television commercial correctly noted, about one-third of Americans really don't have anything saved for retirement, according to a 2016 survey by the finance website GoBankingRates.  Other studies, such has one produced by the Economic Policy Institute, a left-leaning think-tank, have documented similar results. Prior to ERISA employer-sponsored pension plans, combined with Social Security benefits and, more recently, defined contribution plans, had truly turned retirement into the "golden years" for millions of 

workers. So until the past decade, workers didn't put much thought into saving for retirement, much less worrying about it.

Since the passage of  ERISA, corporate America has opting out of defined-benefit pensions for decades, and many experts agree that is a major cause of our retirement security crisis Jerry Gazelle, in an article for Workforce reported that, as of June 30, 2012, only 30 percent of Fortune 100 companies still offered a defined benefit plan to new salaried, a figure that was down from 33 percent at the end of 2011, 37 percent in 2010 and 43 percent in 2009.  Gazelle noted that, as recently as 1998, defined benefit plans were the norm among the nation's argest employers, at a time when 90 percent of those Fortune 100 companies offered traditional pension plans to new salaried employees.

By 2017, the future retirement benefits of employees held in union pension plans were at also at risk.  One financial analyst described as it as an "emerging financial crisis among multi employer pension plans in America. These plans are a subset of private sector defined benefit pensions covering 10 million workers and retirees. Most critical are the projected bankruptcies of the Teamsters Central States and the United Mineworkers of America plans, making front page news for the last several months. These plans and many others were undermined by two financial market crashes between 2000 and 2009, corporate bankruptcies, de-regulation, and over-regulation."

Whether even those few, long-term, unionized employees who remain in traditional defined benefit plans will enjoy then pensions for which they worked throughout their lives 

remains an open question. Increasing corporate debt and a lack of pension oversight have exacerbated the problem. 

Tops Super Market chain is one such sad example. In March, 2018, as reported by The New York Times, the chain was cutting prices even though it had filed for bankruptcy the previous month.  In March, 2018, the parent company of the Southern stores, Winn-Dixie and Bi-Lo, announced that it too would file for Chapter 11 protection by the end of that month, and would close 94 stores. 

The private equity firm Lone Star distributed  $980 million in dividends from Winn-Dixie's parent company since 2011, according to Moody's Investors Service. Most of the payments were made by taking out debt on the chain, leaving less money to invest in stores. Marsh Supermarkets, an Indianapolis regional grocer that had also been backed by private equity, laid off more than 1,500 workers and required a federal takeover of its pension plan in 2017.

  Amid the intense competition, the number of supermarkets around the country increased from 2010 to 2015, but the number of supermarket operators declined slightly.  The collapse of many retail supermarket chains implicates the fate of thousands of cashiers, cake decorators and meat cutters, many of whom belong to labor unions and are owed pensions when they retire. Tops, for example, employs more than 12,000 unionized employees at about 160 stores in New York, Pennsylvania and Vermont. 

  The international food giant Ahold acquired Tops in 2001. The company was sold to Morgan Stanley's private equity team six years later.  Under the firm's ownership, Tops loaded up on debt and paid out roughly $300 million in dividends to its investors, according to Moody's. Even though Morgan Stanley no longer owns the company, Tops never overcame the debt burden. And like other unionized supermarket chains, Tops has had to deal with steep pension expenses. 

When it filed for bankruptcy, Tops said it expected to operate "as normal'' throughout the bankruptcy, but union officials are bracing for closings. "I have never seen a bankruptcy that doesn't lead to closing stores," said Frank DeRiso, president of U.F.C.W. Local 1, which represents Tops workers in New York.

These changes have exacted a toll on unions. Membership in United Food and Commercial Workers, the largest grocery union, decreased by more than 9 percent between   2002 and 2016 to about 1.2 7million members, according to the Labor Department.  "The private equity owners try to drain every last ounce of blood from these companies," said John T. Niccollai, president of Local 464A of the U.F.C.W., which represents grocery workers in New York and New Jersey. "Their feeling is if it goes bankrupt, so be it." 

When Mr. Niccollai started working at the union in the late 1970s, the A & P grocery chain had about 7,000 stores. By the time A & P had filed for its second bankruptcy, in 2015, it was down to about 125. Mr. Niccollai found jobs elsewhere for 3,500 workers who had been displaced by the bankruptcy, but 1,500 of his members were out of work. He recently added membership by organizing some of the warehouse workers at the Peapod grocery delivery 

service, but it is challenging when the industry is increasingly dominated by nonunion employers like Walmart and Amazon."We are fighting hard," Mr. Niccollai added.

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Not surprisingly, financial planners and investors have waxed ecstatic about the impact of ERISA: "ERISA had an effect on traditional pension plans and killed some of them, but overall it was good legislation," according to James van Iwaarden, consulting actuary with Minneapolis-based Van Iwaarden Associates. "When defined contribution plans were first introduced in the late '70s, they were never intended to replace defined benefit plans, but to supplement them." Today, "Defined benefit plans are dead," says Bob Pearson, CEO of Pearson Partners International in Dallas. "No company I know offers them even as a means to attract senior executives."

As a result of the  demise of traditional pension plans, Wall Street financiers and their enablers have reaped billions of dollars in fees from "administering" and churning 401k plans since the passage of ERISA. The losers have been the ordinary people who work and live on Main Street. Equally indefensible has been the failure of federal oversight to ensure that traditional pension plans are adequately funded and that pensioners are paid before investors. Lastly, corporations should not be permitted to renege on their obligations to employees through the ruse of bankruptcy, the effect of which is to transfer many of the pension obligations to the Federal Pension Benefit Guaranty Corporation which is subsidized by the taxpayers of the United States. These continuing abuses show that, in our current political and economic system, the concerns of ordinary citizens ring hollow while voices of the 1% sound loudly.   

The mythology of capitalism and the market economy that it has spawned have been successfully invoked by critics to emasculate unions and to compromise the ability of workers in the private and public sectors to demand higher wages and better working conditions. Yet that mythology continues to exert a bizarre intellectual stranglehold over so many Americans who should know better. 

The question that needs to be asked about this orthodoxy - as with all other orthodoxies - is, does it, in fact, explain existing social reality? If the markets for goods and services, absent public regulation, naturally seek to move into equilibrium, as advocates of unbridled market economics assert, why then have the annual median incomes of Americans, as of 2018, fallen precipitously since 1999?  

Why have "fair trade" policies, despite increasing levels of education in the U.S., caused a net migration of millions of U.S. jobs overseas during the past four decades, while the U.S. has continued to accumulate ever increasing balance of payments deficits caused by ever increasing purchases of foreign-made goods that were previously made and still could be made in this country?  

  Charles Duhigg and Keith Bradsher reported in the New York Times that nearly all of the 70 million iPhones, 30 million iPads and 59 million other assorted products sold by Apple sold in 2011 were manufactured overseas, primarily in China by third-party vendors with whom Apple contracted for services and products. Apple employs only 43,000 people in the United States and 20,000 overseas but, as a result of its exploitation of workers through third-party 

vendors, Apple made a profit of $400,000 per each of its actual employees, a sum greater than that made by Goldman Sachs, Exxon Mobil and Google. 

Despite the hyperbole, there is one question that is rarely asked in the popular media.  Is Apple, Inc. a model of corporate efficiency and success that should be praised and emulated in business schools throughout the U.S., or is it a corporate pariah that should be roundly condemned and criticized for its unconscionable greed?

      At a White House dinner in February of 2011, President Obama reminded the late and much heralded Apple CEO Steve Jobs that, once upon a time, Apple boasted that its products were made in America and he asked, "Why can't that work come home? Mr. Jobs's reply, according to other guests present, was terse. "Those jobs aren't coming back," he replied.

 That same year, Apple earned in excess of $400,000 in profit per employee - a sum that was vastly greater than the per employee profits of Goldman Sachs, Exxon Mobil or Google.

             In March of 2013, Apple announced that it held $40.4 billion in untaxed earnings outside of the United States as of September 29, 2012, and should it repatriate that cash, the company estimated it would owe $13.8 billion in taxes, or slightly under the federal 35 percent tax rate.

  The company also disclosed a worldwide annual revenue in 2013 in the amount of  $171 billion. In addition, during the five quarters prior to March 1, 2014, Apple officially reported total acquisition investments of $11.12 billion, in addition to the $1.02 billion in cash "business acquisition" payments.

  All of these grim statistics were called to mind again in the light of a fawning and uncritical article by Rebecca Ruiz that appeared in the Business Section of The New York Times on March 4, 2014.  The purported news story informed readers that Peter Oppenheimer,  Apple's senior vice president and chief financial officer, announced his plans to retire this coming in September, after an 18-year career with Apple.

            Ruiz's article was effusive in her characterization of Oppenheimer's performance as senior vice-president of Apple. She noted that "As chief financial officer for the last decade, Mr. Oppenheimer, who started in 1996 as controller for the Americas, helped oversee a shrewd global financial strategy, with Apple garnering record profit and building a significant pile of cash."

            Ruiz also found it a sign of Oppenheimer's business acumen that "As part of the strategy, Apple set up a web of subsidiaries around the world, allowing the company to legally avoid billions of dollars of taxes in the United States. In 2013, Apple raised $17 billion to fund a shareholder payout, a move that potentially helped the company save on taxes."

            Ruiz quoted Lawrence Isaac Balter, chief market strategist at Oracle Investment Research, who stated that Oppenheimer's "done a fantastic job building the war chest," and repeated a statement by Timothy D. Cook, Apple's current chief executive, who credited Mr. Oppenheimer with "managing the company's finances during a period of significant international expansion and revenue growth."

            At the end of Ruiz's column, we discovered that in fiscal year 2012, Mr. Oppenheimer was lavishly rewarded for his success in having helped to devise Apple's multifarious and ingenious schemes for corporate tax-evasion, and in his having enabled Apple to garner obscene 

profits for its shareholders on the backs of an exploited third work-force: Oppenheimer earned $68.6 million in total compensation package. Not surprisingly, Mr. Oppenheimer stated "I love Apple and the people I have had the privilege to work with and after 18 years here, it is time for me to take time for myself and my family," and it was announced that he had been named to the board of Goldman Sachs.

Apple is only one example of why the United States is no longer a net-exporter of goods and services. U.S. trade and tax policies since the 1970s have incentivized the out-sourcing of goods and services. By the end of 2017, China's trade surplus with the United States rose to a record  $347 billion deficit. The U.S. trade deficit with Canada amounted to $11 billion; with Mexico, a $63 billion deficit; with Japan, a $69 billion deficit; and with Germany, there was a 

$65 billion deficit. The data showed that the U.S. imported $2.2 trillion. Automobiles, petroleum, and cell phones were the largest categories. 

The U.S. is a consumption-driven economy. For that reason, in the long run, the migration of jobs to China and other third-world countries will prove to be self-defeating: An increasingly impoverished middle class here in the U.S. will eventually be unable to purchase the high-end goods that out-sourced manufacturers such as Apple and other U.S. based corporations import and try to sell to domestic consumers.

Inevitably, over time, as economic inequality continues to grow and purchasing power erodes, the life-styles of perhaps a majority of Americans will be reduced to that of most Chinese and Indians today. The problem is that, by and large, entrepreneurs and the boards of directors of corporations don't care about the long-run consequences of their behaviors, no matter how 

ill-advised or self-defeating. Perhaps they have accepted too blithely, as a corporate credo, John Maynard Keynes' observation that in the long-run we will all be dead.

            The sole goal of most corporations is to maximize profits to please their shareholders. In distinct contrast to their own employees, almost all of whom as at-will employees may be discharged from employment for no reason or any non-discriminatory reason at all, the shareholders' interests are protected by the boards of directors and, unlike employees, have a seat at the corporate table. To further protect the interests of shareholders,  the laws of the fifty 

states and the federal government  impose a fiduciary duty upon corporations to their  shareholders. 

An increasing body of evidence suggests that the traditional model of the market economy no longer behaves in the way that its most ardent proponents have predicted. As competition has given way to consolidation, and equal opportunity to plutocracy, the anomalies have now begun to overwhelm the paradigm. Whatever comes next, more of the same is not the answer. Given a mindset that sincerely believes that the pursuit of self-interest is somehow a public good, entrepreneurs and the other vaunted Masters of the Universe remain utterly uninterested in problems such as poverty and pollution, and they have no idea of how to reconcile basic principles of social justice with their desire to make a living.

  In 1647, the Massachusetts General Court required every town in the colony with a population of more than fifty people to found, operate and fund schools. Today, public education in the United States today has grown to encompass more than 15,000 separate school districts across the United States. According to the National Center for Education Statistics, as of 2013-14, there were 98,000 public schools. The Center also reports that total expenditures for public elementary and secondary schools in the United States in 2013-14 amounted to $634 billion, or $12,509 per public school student enrolled in the fall (in constant 2015-16 dollars). 

           Lately, much has appeared in the print media about the malaise of public education in the United States. Numerous reforms have been proposed, many of which involve empowering school administrators, testing students regularly, eliminating collective bargaining rights and tenure for teachers, holding teachers accountable for student performance, and creating more charter schools. None of these proposals, however, address the root problems of public education in the United States.

The compensation paid to public school teachers is one indicator of the low-esteem in which public service and public education is held. Long before the Great Recession of 2007, the salaries paid to public school teachers in the United States lagged fair behind similarly educated employees in the private sector.  As previously discussed, at a time when the public sector is being gutted, the top 25 hedge fund managers earned more than all kindergarten teachers in U.S.  The estimated1 58,000 kindergarten teachers in the United States earned an average teacher salary of $53,480 for a collective income of about $8.5 billion for 2012.  By contrast, the 25 top hedge fund managers found were paid $11.62 billion in 2014.

  As of 2017, at the higher end of the pay scale, teachers in Alaska and New York were paid an average salary of  $77,843 and $76,953. At the other extreme, teachers in Mississippi and Oklahoma were paid an average salary of $42,043 and $42,647, respectively. As result of the tax breaks and budget cuts in public spending enacted in many of the GOP controlled  legislatures, the plight of public school teachers and the schools in which they teach have  worsened in many of the red states. In desperation, teachers in West Virginia and Oklahoma staged state-wide wild-cat strikes in the in the spring of 2018 while a similar threat confronted GOP legislators in Kansas.  

In Arizona, another state where  teacher- inspired protests spread in 2018, teachers' salaries are $10,000 below the national average of $59,000 per year.  Rather than increase taxes, the Pendergast Elementary School District, a district that includes parts of Glendale, Avondale and north Phoenix, has recruited more than 50 teachers from the Philippines since 2015 who were given J-1 visas.  Patricia Davis-Tussey, the district's head of human resources director, was effusive in endorsement of the recruiting process, "In these times, you have to be innovative and creative in recruiting. We embrace diversity and really gain a lot from the cultural exchange experience. Our students do as well."

  In 2011, during a time when states across the nation drastically slashed spending for public education budgets, 41 states introduced 145 pieces of private school choice legislation. The net effect of the more extreme proposals would be to remove education from public oversight and regulation, and permit unlicensed, poorly-paid and poorly-educated individuals to teach creationism, others forms of pseudo-science, extremist religious doctrines, and right-wing politics, history and economics without fear of censure and without any accountability whatsoever.

  Some of the more outrageous measures would dismantle public education almost entirely and taxpayer funds to replace it with a system of vouchers for use in private schools and for-profit schools. By 2017, "private school choice" programs, as these vouchers are called by the Alliance for School Choice, have been enacted in 13 states and the District of Columbia. 

         The amendments to the 529 "educational savings plan" that President Trump signed into law in 2018 are  by far the most drastic attack to date upon public education in the United States.  Christianity Today was effusive in its praise:" Parents now have another way to save for Christian school tuition--and this one comes with tax benefits. Thanks to the GOP-led tax reforms, the 529 college savings vehicle--so named for the relevant section of the Internal Revenue Code--can now also be used to save money to pay tuition at any "elementary or secondary public, private, or religious school."

  A number of the reforms that have gained cachet in the mainstream media were touted by President Obama's Secretary of Education, Arne Duncan, by the Bill and Melinda Gates Foundation, the Walton Foundation, the Broad Foundation, and former D.C. Superintendent of Schools, Michelle Rhee, among others. Interestingly, none of these proponents of public school reform ever taught in a public school or had any direct experience in trying to challenge students, particularly students under stress, to learn. The larger question, however, is: will any f their proposed reforms actually improve public education in the United States or will they further undermine it?

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At the post-secondary school level, the crisis is equally dire. A report from the Brookings Institution documents so many young people with extraordinary debt. Between 2000 and 2014, the number of students holding education debt increased to 42 million, and their total outstanding debt outstanding quadrupled  to a staggering sum in excess of $1 trillion. In 2000, there was only one for-profit institution among the 25 colleges and universities where students held the most student-loan debt. In 2014, there were thirteen such institutions with the University of Phoenix at the top of t he list. The amount of debt owed by those attending for-profit colleges grew from $39 billion in 2000 to $229 billion in 2014. 

These for-profit  colleges, through the use of sophisticated and unscrupulous advertising and recruiting, preyed upon the most vulnerable part of are young adult population - those who were poorly prepared for success in work force and often didn't have the skills, the finances or the time to attend a local college or university. Between 2000 and 2011, the total enrollment at for-profit colleges increased from grew from 3 percent of total fall enrollment to 9 percent of total fall enrollment.

President Trump's Secretary of Education, Betsy DeVos, is a zealot who disguises her antipathy to public education by insisting that she is an advocate of education "reform." A Michigan billionaire and conservative activist, she decries public education as a"state monopoly," and she has spent millions of dollars in successful efforts to expand voucher programs and to use taxpayer dollars to enable families to pay for private and religious chools. Ms. DeVos - who never attended a public school and home-schooled her children -  would reform public education by privatizing it. 

In February of 2018,  DeVos called on Americans to embrace a vision of "education freedom" that would, she said, empower students and parents with a "multitude of pathways" toward new opportunities. Appearing at the right-wing Conservative Political Action Conference, Ms. DeVos advocated the use of educational savings accounts to benefit military families who didn't want to send their children to "failing public schools." "For too many decades" Americans have had a singular focus on going to a four-year college or university," DeVos said during the exchange with Kay Coles James, president of The Heritage Foundation. "But there is [sic] a multitude of pathways [with] many opportunities beyond high school."

Consistent with her antipathy to public regulation of education, in July of 2018, Ms. DeVos announced  plans to eliminate regulations that forced for-profit colleges to prove that they provided gainful employment to the students they enrolled. Those gainful employment regulations were put in place by the Obama administration and were designed to preclude  federally guaranteed student loans to colleges if their graduates did not earn enough money to pay them off. Ms. DeVos's announcement was intended to placate the many for-profit colleges nd universities whose economic fortunes were jeopardized  because too many of their alumni were too poorly educated to find decent jobs.  In stark contrast to the Obama administration,  by December, 2017, DeVos' department had approved only a fraction of the applications for student loan forgiveness.

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  Nicole Allen has documented the travails of American public education in the Atlantic magazine. Students in the United States ranked 21st among counties in Science; 14th in reading skills, and 30th in Mathematics skills, according to the International Student Assessment for 2009. By contrast, students in Finland ranked 2nd in Science, 3rd in reading sills, and 6th in Mathematics skills. 

  Many might argue that any comparison between Finland and the U.S. is meaningless, given the size of the population and racial diversity of the U.S. in contrast to Finland. But is it possible that the example of Finland can still instruct, and if so, how?   

First, Finland has created uniformly high standards for all of its students and those standards are supported and insured throughout the entire country. This is in stark contrast to he U.S. where the federal government and the states impose, at best, minimal requirements upon local school districts.

  Secondly, only 7% of the applicants to the University of Helsinki's teacher programs are accepted. Upon completion of their education and practicum, teachers in Finland are paid more than 80% of the average of full-time earnings of college-educated adults in that country. By contrast, in the United States, teachers are uniformly poorly paid and are often recruited  from the bottom quartile of college graduates. As the Atlantic data shows, even in more selective education programs such as those at Johns Hopkins School of Education and at olumbia University's Teachers College, 53% and 56% of the applicants respectively are accepted.

  Third, teachers in Finland, as recognized and valued professionals  - all of whom are also unionized - are given great latitude in their methods of teaching; and collegiality, rather than a top-down management model, governs decision-making in the schools. By contrast, here in the United States, the GE management model of public execution and intimidation  - exemplified by the likes of Michelle Rhee - controls educational discourse.

  Lastly, and most importantly, Finland's education system succeeds because its students are ready and prepared to learn. As a social democracy, Finland has perhaps the Western world's most extensive safety net. The country has universal medical care, strong family-support, child welfare, nutritional programs, minimal poverty and its population 

would never tolerate the kind of extreme economic inequality that is blithely accepted as inevitable in the United States.

  By contrast, the evidence shows that here in the United States the problems caused by a decentralized, unequally-funded system of local public education are compounded by the existence and tolerance of widespread economic and social inequality which also explains, in large part, the uneven outcomes in America's decentralized education system and the dismal performance of so many of the children who are enrolled.

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David Berliner, Regents Professor at Arizona State University, analyzed those "out-of-school factors" (OSFs) which "play a powerful role in generating existing achievement gaps" that continue to undermine the purpose of the federal "No Child Left Behind" act.  Berliner, in a wide-ranging review of the existing data and summary of the educational literature, identified six significant factors among poor children that adversely affected their health and learning opportunities and which therefore "limit what schools can accomplish on their own: (1) low birth weight and non- genetic prenatal influences on children; (2) inadequate medical, dental, and vision care, often a result of inadequate or no medical insurance; (3) food insecurity; (4) environmental pollutants; (5) family relations and family stress; and (6) neighborhood characteristics."

         These six factors, Berliner concluded, "are related to a host of poverty- induced physical, sociological and psychological problems that children often bring to school, ranging from neurological damage and attention disorders to excessive absenteeism, linguistic under-development, and oppositional behavior." Berliner further observed that, "Because America's schools are so highly segregated by income, race, and ethnicity, problems related to poverty occur simultaneously, with greater frequency, and act cumulatively in schools serving disadvantaged communities. These schools therefore face significantly greater challenges than schools serving wealthier communities, and their limited resources are often overwhelmed."

  The data which Berliner cites showed that, in 2006-2007, the average white student attended a public school in which about 30 percent of the students were classified as low-income. By contrast, the average black or Hispanic student attended a school in which nearly 60 percent of the students were classified as low-income, while the average American Indian was enrolled in a school where more than half of the students were poor. "These schools," Berliner concluded, "are often dominated by the many dimensions of intense, concentrated, and isolated poverty that shape the lives of students and families."

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  Horace Mann believed that education had the potential to become  "the great equalizer in the conditions of men." For that reason, he became an early advocate of the importance of public education for all citizens. Later, John Dewey insisted that "Since a democratic society repudiates the principle of external authority, it must find a substitute in voluntary disposition and interest; these can be created only by education."   

The growth of the charter school movement and the use of vouchers, non-taxable educational savings accounts, the increasing popularity of home schooling and on-line learning epitomize the fragmentation of American public education. These trends threaten to further cripple one of the few remaining institutions that has historically enabled many Americans to share common experiences, develop friendships across the race and class-divides, and acquire commonly-held civic values. The resulting social and intellectual isolation - coupled with the relentless, continuing assault upon teachers and their unions, the imposition of management models dawn from the private sector, the continued dumbing down of curricula, and proposals to turn public education over to religious zealots, entrepreneurs and for-profit foundations  - are precisely the wrong direction for this country to meet the challenges posed by a global economy. Sadly, these trends underscore how far this country has strayed from the grand visions of Horace Mann.

  Our democracy is fragile and an educated citizenry is essential to its preservation.  Every sentient person should be alarmed about the continued corporatization and privatization of American public education. But concern alone is not sufficient to defeat the tidal wave of dark money that is bent on shaping the vision of  American that, if unchecked, will increasingly resemble the kind of dystopia described by Thomas Hobbes of life outside of society in which the "life of man was solitary, poore, nasty, brutish and short."