In President Barack Obama’s first term, the fiscal stimulus and the auto industry rescue of 2009 created and preserved millions of jobs. But the stimulus ended years ago, replaced with temporary measures that have been insufficient to propel the economy forward. Health care reform in 2010 was a major step in the effort to support the middle class, but its broad effects will only be felt in the years and decades to come.
In recent years, the administration and Congress have been consumed with deficit reduction, which is antithetical to job creation because it curbs government spending when the economy is weak. Unless Obama can shift policy away from premature austerity and toward ways to bolster demand and foster investment, job growth will remain sluggish and unemployment high.
What has been missing for years is a forceful labor agenda — one that not only calls for more jobs, but has as its goal rising wages coupled with robust hiring.
Obama can take an important step in that direction by placing his next labor secretary at the center of his economic team. The first-term labor secretary, Hilda Solis, was largely sidelined, a reflection of the administration’s focus on the recovery of Wall Street, not Main Street. Some of the new names that have been floated for the job — including Jennifer Granholm, the former governor of Michigan — show that Obama is seeking someone of high stature, but any secretary’s ability to be a transformative force will depend on the president’s support.
Part of an effective agenda would surely include a higher minimum wage, which is overdue. It is one of the most effective ways to lift wages because raising the floor also raises wages higher up the income scale. Union membership can also push up wages through collective bargaining. In 2012, even as the share of American workers in a union fell to its lowest level in nearly a century, the median weekly earnings of full-time unionized workers was $943 versus $742 for comparable nonunion workers, according to the Bureau of Labor Statistics.
And yet, the administration’s support for unions has been more rhetorical than real. Obama failed to keep a campaign promise from 2008 to advance legislation to make it easier for workers to unionize and made scant use of the bully pulpit as unions have come under prominent attack in Wisconsin, Indiana and Michigan.
A recent federal court ruling invalidating his recess appointees to the National Labor Relations Board, which enforces federal labor law, will be a further setback to workers’ ability to bargain for higher wages. The misguided decision, if upheld, would deny the board a quorum to rule on legal questions. In seeking to overturn the ruling, all the way to the Supreme Court if necessary, the administration should take aim at the court’s unjustified incursion on presidential power and its anti-union bias.
The White House must also commit to new rules on workplace safety, wage and overtime enforcement and proper classification of workers as employees versus independent contractors, a label that employers often misuse to deny benefits. Labor reforms are also central to immigration reform. Legalizing unauthorized workers and revamping federal visas for noncollege-educated workers could raise wages by limiting exploitation, while ensuring that American workers have a fair shot at lower-skilled jobs for which there is significant foreign competition.
In his first term — a time of persistent high unemployment, weak job growth, stagnating wages and rising income inequality — Obama neglected a basic labor agenda. He now has a chance to take corrective action.
— The New York Times
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