That's an interesting catch phrase, isn't it? I'd never heard it until I read this article by Ed Kilgore in The New Republic. He's using it to describe the model for economic growth that the South has been using for years:
. . . the capital-starved, low-wage region concluded that the way it could compete economically with other states was to emphasize its comparative advantages: low costs, a large pool of relatively poor workers, “right to work” laws that discouraged unionization, and a small appetite for environmental or any other sort of regulation.I'd add that as part of this strategy the South (like most other regions, truth be told) is willing to offer almost any tax break to businesses willing to build or relocate there; witness the the bidding war for a new VW plant ultimately built in Chattanooga, TN.
From the employee's point of view, the trouble with this strategy is that any attempt to organize these new jobs runs into these states' "right to work" policies. It comes from the Taft-Hartley Act of 1947, passed over Truman's veto, and it means that no employee can be compelled to join or pay the equivalent of dues to a union, nor can the employee be fired if he or she joins the union. Thus the right to work.
Well, guess what? If unions are discouraged, unions won't be organized. The workers will probably get lower wages and fewer benefits than their counterparts in similar jobs in other states. What the plant owners and the states are counting on is that those jobs are still far better than most others available in those states, so the employees won't get too restive. They may be fired at will, but their employers rely on the relative value of those jobs to attract new workers to replace them. The states are happy, because they've got a higher tax base (from those employed workers, not from the companies; they gave away all the potential taxes the employers would ordinarily pay in order to get them to locate there in the first place, remember?) The employers are happy, because they've got a cheaper place to do business. Who are the losers? The employees, of course.
Posted by Linkmeister at March 1, 2011 07:34 AM | TrackBack