Last week, the United Auto Workers reached a deal with Stellantis to re-open an idled Belvidere Assembly Plant. "We made them invest," said transformational UAW President Shawn Fain.
And the Biden NLRB is the most pro union incarnation in any recent administration.
The message to unions is clear: in the most favorable political climate of a generation, strike now because you may never have a chance this good again.
the politicians get together with the union who gets together with the corporation to "work things out". billions in corporate profits and the workers still have a two-tier wages. are the wages keeping up with inflation?
Nov 5, 2023·edited Nov 5, 2023Liked by Matt Stoller
This is a *terrific* post. I've never read brief summary that so clearly offers a framework to understand how rent-seeking has displaced manufacturing as a business strategy, and the way ideology, legislation, and regulation (or the withholding of it) have combined to enable--or promote--this shift.
I'll reread this tomorrow and learn more: it's too rich to take it all in at once.
👏👏👏👏 Thank you, Lee! Succinct historical analysis. Matt, you deserve many 👏 for your awesome choice during your well deserved leave. Finally, Jack Welch 🤬.
Born in the early 40’s I grew up when high taxes and strong unions keep limited the rich from obtaining the concentration of wealth they have today. The greedy got tired of paying taxes and bought our congress to stop enforcing any laws that prohibit monopolies. This permitted corporations to consolidate giving them market power to charge monopoly prices to obtain greedy profits. Our politicians and greedy corporations have destroyed the American economy in the last 40 years. The rich destroyed unions taking away workers ability to fight capital for their fair share of profits. All this led to the massive transfer of wealth from the working and middle class to the 1%. I have wanted a long time to see America wake up to the greed of the wealthy. Unions made American great and will again.
Jack Welch was one of the most pernicious CEOs in American history. What's worse, every major MBA program in America modeled their programs after his disastrous policies. Politicians were in awe and enabled the financialization of the world. Jack Welch's ghost is thriving in private equity firms as they continue the carnage.
Jack Welsh needs to be cancelled, accolades destroyed, and MBA programs scrapped and rewritten.
Don't neglect the role of Reagan and the Republican Party and defector Democrats like Clinton in undermining American business culture. We shouldn't cancel; we should remember bad history and educate MBAs by requiring them to work on an assembly line (or a hospital floor) for a semester.
Agree. Beyond comprehension was Clinton realized Reagan's dream by killing the "Banking Act of 1933 (Glass-Steagall) - effectively separated commercial banking from investment banking and created the Federal Deposit Insurance Corporation.". The oligarchs partied and shouted "Never again will we be regulated!".
I think it's impossible to regulate them today just as it's impossible to stop humans from overheating the Earth.
Danish Orsted just cancelled two wind projects off the NJ coast. Too expensive. Republicans cheered. Wall to wall coverage of mid-east conflict. Nothing on climate change.
Ultimately, the issue is too many humans. Virtually every major issue we have today is due to too many people. Tech loves it because they commoditize professions so one person or AI can see many patients/customers, removing the human element. Talking about population is also a third-rail subject.
Even Naomi misses it - add less resource devouring people:
In her new novel, ‘The Future,’ the bestselling author suggests that, with enough money, kindness and yes, tech, our world could be transformed
"This is the way the world ends: not with a bang or a whimper, but an alert from an early-warning system sent to one’s personal device, signaling imminent apocalypse. The alert isn’t for you or me or the billions of others on our planet. It’s sent to the three tech moguls who effectively rule the world, giving them a few days’ head start so they can be flown (genuinely under the radar) to their respective bunkers, where they’ll be joined by a few family members and friends who will help them reboot civilization once the catastrophe subsides."
I went to see Jack speak and sign his new book at the Nixon Library during my MBA (~2014). The audience was exactly what you'd expect. Me and a classmate were two of the few people in the crowd that looked under 60 (we're millenials).
I think his legacy is already on its way out. Ultimately, I think focusing too much on the individual is counterproductive. There will always be an army of people like Jack ready to milk the incentives. With the right changes, the future ghostwritten MBA slop on #winning may have parts where you build things as well.
I hope that's true Al, but I'd say pretty much every manager and executive in companies I've worked for in my career with an MBA seems to be drinking from the Jack Welch chalice of sociopathic "profit above all" Koolaid.
Individual attitudes outside the managerial ranks and C-suites is certainly changing, but I suspect the moneyed class is keeping the curriculum of business schools squarely where they want it.
A shiny new jackboot for a shiny new age. The intentional destruction of the middle class, the gutting of the American industrial base and the final 2008 looting of the economy. Now because the perps can no longer hide their faces, the creation of a cyber Stasi. Every tax dollar controlled and pipelined to corporate fascists and the poseur "woke" moralists paid to subvert and destroy.
Wow, very educational ! One thing that occurs to me is why isn't there a movement or a politician willing to write a law to to end stock buybacks ? Seems like a pretty evil easy to understand thing to stop. And why no movement to ban private equity which seems like pure self-devouring capitalism ?
From my childhood memory, unions were only truly established when FDR was preseident. Prior to that the effort to unionize was met with violence - and then finally the depression. So it's not surprising that unions and their leaders in the first genuine establishment of unions were not thinking of running a business but working for fair wages and under decent conditions. By the time Jack Welch came around, businesses were back to the scrooge mode. But union officials and workers have benefitted from the broader discussion of business and economics. And many union workers have more than a high school education. But however it happened, hats off to the unions.
Excellent synopsis of this horrendous policy that has virtually killed labor and therefore it’s many many workers who have paid the price for the last 40 years. Let’s hope the new anti-trust enforcement and the successful union organizing and dare I say winning continue unabated.
This is so refreshing. Now all we need to do is clear out the elites who've been running this monopolistic grift for decades, and start again. With a world where capital serves the people, not the other way round.
When a corporation's stock can be shorted down to nothing in seconds, how do you get a CEO to think past this quarter? And when pension plans, 401(k) accounts and even manager bonuses are vauled in stock, what's a mutual fund manager to do when he hears that a company is going to pull the dividend and build a new plant? The guys managing CALPERS will do what they're supposed to do as a fiduciary, they'll sell. Because they aren't going to risk the school teacher's retirement on a bet that reshoring will pay off in the long run. Maybe they'll get back in after the bet pays out, but by pricing the stock down they're going to kneecap the "responsible" CEO. So the only other choice is to get Uncle Sam to pony up the dough for the project, and that's full of moral hazard and strings attached. But maybe with the federal government backstopping the project the fund guys won't bail.
And the fact that average American's retirements actually only constitute about 15% of the stock market's value, while 89% is held by the top 1% already... yet we're all supposed to constantly avert any kind of policy change that will "spook the market" because of this pretense that it's "everyone's retirements" on the line.
Sure, it's our retirements on the line, but the narrative is 100% about defending the embedded advantages of the already very wealthy. If I can't retire without sucking all the bone marrow out of current & future working class people's economic gains (as the top 1% already did to the rest of us for the last 45 years: https://time.com/5888024/50-trillion-income-inequality-america/ ) then maybe this system isn't working properly. :P
I'm on the side of the gold bugs for this reason. The case for gold is that you don't need to invest for your retirement because technology will lower production cost over time and that (silver) dollar will buy more in the future than it does today. But the idea that everyone will hold off purchases until the price comes down is BS. You buy something because you value it more than the money it takes to buy it, but because Keynes' theory encourages debt it gets all the attention.
"distant financiers who control our lives and communities have overstayed their welcome."
Hear, hear. Crush these weasels, make them flee in disgrace, and then reinstitute every New Deal-era constraint on them, such as Glass-Steagall, and infuse it with steroids. Then, make it crystal-clear to these people that prison awaits them if they attempt to skirt or undermine the law. Go Wright Patman on them good and hard.
Nicely written--I surprised you didn't mention GE's demise in recent years, driving home Jack Welch's legacey and, in turn, that of a failed macro economic policy going back 40 or 50 years.
Excellent post, which answered so many questions I had on how and why the US stopped making things. As an aside, there is a Walter Reuther Freeway in Detroit. https://en.wikipedia.org/wiki/Interstate_696
This is a great point. There are many ways to skin a cat, and there are many ways to invest in thriving local communities. Government subsidies and direct investments are just one way. Empowering people is another, potentially better way.
And the Biden NLRB is the most pro union incarnation in any recent administration.
The message to unions is clear: in the most favorable political climate of a generation, strike now because you may never have a chance this good again.
Unless you're a railway worker.
the politicians get together with the union who gets together with the corporation to "work things out". billions in corporate profits and the workers still have a two-tier wages. are the wages keeping up with inflation?
Excellent history lesson, and context for the painfully slow reawakening of the autonomy of Americans.
This is a *terrific* post. I've never read brief summary that so clearly offers a framework to understand how rent-seeking has displaced manufacturing as a business strategy, and the way ideology, legislation, and regulation (or the withholding of it) have combined to enable--or promote--this shift.
I'll reread this tomorrow and learn more: it's too rich to take it all in at once.
👏👏👏👏 Thank you, Lee! Succinct historical analysis. Matt, you deserve many 👏 for your awesome choice during your well deserved leave. Finally, Jack Welch 🤬.
Born in the early 40’s I grew up when high taxes and strong unions keep limited the rich from obtaining the concentration of wealth they have today. The greedy got tired of paying taxes and bought our congress to stop enforcing any laws that prohibit monopolies. This permitted corporations to consolidate giving them market power to charge monopoly prices to obtain greedy profits. Our politicians and greedy corporations have destroyed the American economy in the last 40 years. The rich destroyed unions taking away workers ability to fight capital for their fair share of profits. All this led to the massive transfer of wealth from the working and middle class to the 1%. I have wanted a long time to see America wake up to the greed of the wealthy. Unions made American great and will again.
Shawn Fein for President in 2028.
Jack Welch was one of the most pernicious CEOs in American history. What's worse, every major MBA program in America modeled their programs after his disastrous policies. Politicians were in awe and enabled the financialization of the world. Jack Welch's ghost is thriving in private equity firms as they continue the carnage.
Jack Welsh needs to be cancelled, accolades destroyed, and MBA programs scrapped and rewritten.
Don't neglect the role of Reagan and the Republican Party and defector Democrats like Clinton in undermining American business culture. We shouldn't cancel; we should remember bad history and educate MBAs by requiring them to work on an assembly line (or a hospital floor) for a semester.
Agree. Beyond comprehension was Clinton realized Reagan's dream by killing the "Banking Act of 1933 (Glass-Steagall) - effectively separated commercial banking from investment banking and created the Federal Deposit Insurance Corporation.". The oligarchs partied and shouted "Never again will we be regulated!".
I think it's impossible to regulate them today just as it's impossible to stop humans from overheating the Earth.
Danish Orsted just cancelled two wind projects off the NJ coast. Too expensive. Republicans cheered. Wall to wall coverage of mid-east conflict. Nothing on climate change.
Ultimately, the issue is too many humans. Virtually every major issue we have today is due to too many people. Tech loves it because they commoditize professions so one person or AI can see many patients/customers, removing the human element. Talking about population is also a third-rail subject.
Even Naomi misses it - add less resource devouring people:
In her new novel, ‘The Future,’ the bestselling author suggests that, with enough money, kindness and yes, tech, our world could be transformed
https://www.washingtonpost.com/books/2023/11/05/naomi-alderman-future-review/
"This is the way the world ends: not with a bang or a whimper, but an alert from an early-warning system sent to one’s personal device, signaling imminent apocalypse. The alert isn’t for you or me or the billions of others on our planet. It’s sent to the three tech moguls who effectively rule the world, giving them a few days’ head start so they can be flown (genuinely under the radar) to their respective bunkers, where they’ll be joined by a few family members and friends who will help them reboot civilization once the catastrophe subsides."
Jack Welch is right up there on my list of people I'd go back in time and remove from the timeline entirely, if you gave me a time machine.
What a legacy of destruction he wrought on us all.
I went to see Jack speak and sign his new book at the Nixon Library during my MBA (~2014). The audience was exactly what you'd expect. Me and a classmate were two of the few people in the crowd that looked under 60 (we're millenials).
I think his legacy is already on its way out. Ultimately, I think focusing too much on the individual is counterproductive. There will always be an army of people like Jack ready to milk the incentives. With the right changes, the future ghostwritten MBA slop on #winning may have parts where you build things as well.
I hope that's true Al, but I'd say pretty much every manager and executive in companies I've worked for in my career with an MBA seems to be drinking from the Jack Welch chalice of sociopathic "profit above all" Koolaid.
Individual attitudes outside the managerial ranks and C-suites is certainly changing, but I suspect the moneyed class is keeping the curriculum of business schools squarely where they want it.
A shiny new jackboot for a shiny new age. The intentional destruction of the middle class, the gutting of the American industrial base and the final 2008 looting of the economy. Now because the perps can no longer hide their faces, the creation of a cyber Stasi. Every tax dollar controlled and pipelined to corporate fascists and the poseur "woke" moralists paid to subvert and destroy.
Absolutely fascinating. This was a great read for someone with only a minimal understanding of historical labor/corporate politics like myself.
Inspired me to take a similar perspective in my own work surrounding nursing and the US healthcare system.
Appreciate the work!
Wow, very educational ! One thing that occurs to me is why isn't there a movement or a politician willing to write a law to to end stock buybacks ? Seems like a pretty evil easy to understand thing to stop. And why no movement to ban private equity which seems like pure self-devouring capitalism ?
Yes, please more articles on these 2 subjects and Glass-Steagall Banking Act. Is reform possible?
From my childhood memory, unions were only truly established when FDR was preseident. Prior to that the effort to unionize was met with violence - and then finally the depression. So it's not surprising that unions and their leaders in the first genuine establishment of unions were not thinking of running a business but working for fair wages and under decent conditions. By the time Jack Welch came around, businesses were back to the scrooge mode. But union officials and workers have benefitted from the broader discussion of business and economics. And many union workers have more than a high school education. But however it happened, hats off to the unions.
Excellent synopsis of this horrendous policy that has virtually killed labor and therefore it’s many many workers who have paid the price for the last 40 years. Let’s hope the new anti-trust enforcement and the successful union organizing and dare I say winning continue unabated.
For anyone interested in the actual disease:
https://youtu.be/G2DIEzdJLaA?si=q-gDyUZBUi7ONHJe
This is so refreshing. Now all we need to do is clear out the elites who've been running this monopolistic grift for decades, and start again. With a world where capital serves the people, not the other way round.
When a corporation's stock can be shorted down to nothing in seconds, how do you get a CEO to think past this quarter? And when pension plans, 401(k) accounts and even manager bonuses are vauled in stock, what's a mutual fund manager to do when he hears that a company is going to pull the dividend and build a new plant? The guys managing CALPERS will do what they're supposed to do as a fiduciary, they'll sell. Because they aren't going to risk the school teacher's retirement on a bet that reshoring will pay off in the long run. Maybe they'll get back in after the bet pays out, but by pricing the stock down they're going to kneecap the "responsible" CEO. So the only other choice is to get Uncle Sam to pony up the dough for the project, and that's full of moral hazard and strings attached. But maybe with the federal government backstopping the project the fund guys won't bail.
Tough choices. No easy answers.
No easy answers, but it frustrates me that I have to depend on the stupidity of the stock market to support my soon-to-be-necessary retirement.
And the fact that average American's retirements actually only constitute about 15% of the stock market's value, while 89% is held by the top 1% already... yet we're all supposed to constantly avert any kind of policy change that will "spook the market" because of this pretense that it's "everyone's retirements" on the line.
Sure, it's our retirements on the line, but the narrative is 100% about defending the embedded advantages of the already very wealthy. If I can't retire without sucking all the bone marrow out of current & future working class people's economic gains (as the top 1% already did to the rest of us for the last 45 years: https://time.com/5888024/50-trillion-income-inequality-america/ ) then maybe this system isn't working properly. :P
I'm on the side of the gold bugs for this reason. The case for gold is that you don't need to invest for your retirement because technology will lower production cost over time and that (silver) dollar will buy more in the future than it does today. But the idea that everyone will hold off purchases until the price comes down is BS. You buy something because you value it more than the money it takes to buy it, but because Keynes' theory encourages debt it gets all the attention.
Tariffs on imports from country with no environmental or labor protections for a start would help
"distant financiers who control our lives and communities have overstayed their welcome."
Hear, hear. Crush these weasels, make them flee in disgrace, and then reinstitute every New Deal-era constraint on them, such as Glass-Steagall, and infuse it with steroids. Then, make it crystal-clear to these people that prison awaits them if they attempt to skirt or undermine the law. Go Wright Patman on them good and hard.
Wow, a right to the jaw! Good one
Nicely written--I surprised you didn't mention GE's demise in recent years, driving home Jack Welch's legacey and, in turn, that of a failed macro economic policy going back 40 or 50 years.
Excellent post, which answered so many questions I had on how and why the US stopped making things. As an aside, there is a Walter Reuther Freeway in Detroit. https://en.wikipedia.org/wiki/Interstate_696
This is a great point. There are many ways to skin a cat, and there are many ways to invest in thriving local communities. Government subsidies and direct investments are just one way. Empowering people is another, potentially better way.