Goldman Wins, Workers Lose

Goldman Wins, Workers Lose

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The conventional wisdom holds that Barack Obama’s first term will be judged by whether he can revive the economy, which currently boasts an unemployment rate of 9.5 percent, a figure that excludes the large number of "marginally attached" people who have basically stopped searching for jobs and many others who are involuntarily stuck in part-time positions (the actual unemployment rate, by some estimates, is 16.4 percent).

But even if unemployment declines between now and 2012, there remains the question of whether Obama and the Democrats can reverse the staggering level of wealth and income inequality in America. Robert Reich has argued that Obama is passionate about this issue. That may be, but scolding bankers for taking home exorbitant salaries is one thing, passing serious regulation of the financial industry another. Goldman Sachs just reported record quarterly profits, JP Morgan $2.7 billion in profits; both will soon be showering their employees with massive bonuses. Meanwhile, as Paul Krugman notes in his latest column, "new regulations are still in the drawing-board stage."

For less lavishly compensated workers, it’s another story, thanks to the half-dozen Democratic Senators who just dropped the card-check provision from legislation that might have made it easier to organize unions. Moderate Democrats apparently bought the argument that the card-check provision is undemocratic (having long been unconcerned that companies routinely use undemocratic methods to prevent workers from organizing unions). There are legitimate disagreements about how much the card-check provision would actually boost the rate of unionization in the private sector, which now stands at a paltry 7.6 percent. There are no disagreements that its defeat marked a victory for the business lobby, which campaigned strenuously against it for a reason not hard to guess: the fear that it might actually empower workers.

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