This spring, I co-taught a class at Metro State University for the first time. The class was called “Labor and the Political Economy” and we met on Saturday mornings. The students were super smart, and I was surprised by how much I enjoyed the experience!
My class explored perspectives on the economy. Formally, those perspectives included: Keynesianism, Social Democracy, Neoliberalism and New Right Populism. But as someone who is NOT fully committed to any of those perspectives, I brought a different view to the classroom. I helped analyze the economy with the principles of Trade Unionism. One easy way Union members can evaluate choices in our economy is to use a Trade Union lens. This means continually asking, “who benefits and who decides”? If a decision about the economy is made that does not include the voice of workers it is likely the decision will not benefit workers. And who benefits when workers’ voices are excluded? Well… you probably already know that.
During our class, we saw fifty new policies about tariffs and trade announced by President Trump. As you can imagine the students were curious about what the labor movement thought of these tariffs. Most Unions did not support Trump for President, but Unions are also notoriously skeptical of global free trade policies. Indeed, the American Federation of Labor (AFL-CIO)–the organization that brings unions together–led the fight against most of the free trade agreements that have shaped the economy we have today, including the North American Free Trade Agreement (NAFTA), and the twenty additional free trade agreements that followed. Indeed, some of the talking points embraced by Trump sound a lot like the labor movement’s own during the fight against NAFTA. So how should we, as Union members, think about the tariffs now?
Before jumping in to explore who is benefiting and who decides when it comes to the recent tariff and trade policies, let’s take a look at the labor movement’s role in making factory jobs good jobs and review the labor movement’s critique of free trade policies that were adopted between 1990 and 2024.
Lesson #1: Left to the Market, Factory Jobs Always Suck!
Most people know that early manufacturing jobs were terrible, dirty, and unsafe. In other words, they sucked. Long days were the norm, supervisors were known for arbitrary, abusive treatment, and workplace injuries were common.
Things only changed because workers organized–workers went on strike again and again to protect themselves from the ravages of a free market. Over decades, workers won Union contracts that eventually included the 8-hour day, steady work, higher pay, pensions, and most importantly, seniority and job protections that prevented widespread disrespect from supervisors. From the 1930s through the 1990s, a Union job at a factory could support a family. Wages were enough to buy a home. And contracts ensured enough time off so you could coach Little League, have quality family time and send your kids to college. In 1990, eighteen million jobs (16% of all American jobs) were factory jobs, and the majority were good paying Union jobs. Factory jobs paid 6% more on average than the rest of the private sector. Union factory jobs paid even more.This was how millions of working-class families lived the American Dream.
The labor movement knew that free trade agreements would threaten these jobs. Rather than including the voice of workers in creating the policies, however, politicians excluded labor from the negotiations. Union members were forced to protest to be heard. The labor movement warned of a “race to the bottom” for wages and working conditions as corporations would inevitably move operations to the lowest cost place they could operate. Rather than unleashing unfettered free trade globally, Unions advocated for “Fair Trade” policies that would maintain tariffs on many products based on labor and environmental standards across borders to even the playing field. Sadly, we will never know what world was possible if “fair trade” principles were adopted instead.
What happened as a result of the global free trade agreements? Factory jobs were thrown back to the ravages of the free market. And now once again, anywhere you go in the world, factory jobs suck. In any country, a factory job will pay only slightly more than the bare minimum needed to live; the rest of the profits from the product are gobbled up by Wall Street.
(photo by Al Crespo: World Trade Organization protests, Seattle, 1999)
Leson #2: Free Trade Has Benefits… But They Don’t Outweigh the Cost
Those who advocate for global free trade typically embrace a “Neoliberal” economic philosophy. Neoliberals truly believe that free trade is a net benefit to consumers. In a neoliberal economic system, goods and services SHOULD be produced at the lowest possible cost and with great improvements in shipping and transportation, those goods can be delivered to consumers anywhere, more cheaply. In this way, families can buy more stuff with the same amount of money! The philosophy is powerful because there is some truth to their claims: tennis shoes, clothing, even small appliances are cheaper today because of free trade. But who benefited the most? Corporations and the wealthy few- the same people who decided the free trade policies in the first place.
As Unions, we view people as both consumers AND producers (workers). In order for workers to have money to spend, they need a job and a paycheck that hopefully grows year after year. Today, there are 5 million fewer factory jobs in the U.S. than there were in 1990–only 8% of American jobs today are in factories. Most of those jobs are now non-Union, and factory workers today earn 5% less on average than other private sector jobs. It was not just factory jobs that were impacted by free trade agreements either. When Unions stopped being able to lift the wages and benefits of factory workers, wages stagnated across the board. Average annual wage growth since 1990 was 3.11% and the annual rate of inflation was 2.9%, meaning workers haven’t received a real raise since NAFTA was enacted. Meanwhile salaries for the top 1% have exploded.
While I do not like many of President Trump’s policies or his rhetoric, I do appreciate that his unapologetic embrace of tariffs has served as a punch to the face of the neoliberal consensus that occupied Washington D.C. Neoliberalism has been embraced by both political parties–at a great cost to working class families. If nothing else good comes from Trump’s presidency I do hope we can smash the idea that people only matter as consumers and not when they are working/producing the goods and services that make our world run.
But… Will Trump’s Tariffs Fix This?
Since January, Trump has raised, modified, or announced new tariffs fifty times. Since the labor movement is generally supportive of tariffs to protect jobs, let’s now explore if this is a good thing. In the 1990s, before NAFTA was enacted, factory jobs were good Union jobs and we were trying to protect those jobs from going overseas. Tariffs were an effective tool to protect the jobs that existed. Today, with a few exceptions (the Union portions of the automobile and steel industries being the most notable) factory jobs are no longer good jobs, and most people do not want to work a sucky factory job. So, while tariffs can help us protect the good jobs at General Motors, Ford and U.S. Steel, can they actually bring back the strong Union jobs of the past? Labor leaders see tariffs playing a role in this effort, but tariffs alone won’t recreate good jobs. We need a revitalized labor movement to bargain up the wages and benefits of new factory jobs, otherwise the tariffs will just protect fatter profit margins of the corporations and stockholders.
Don’t believe me? Just look at what happened since steel tariffs were announced on February 10th. The tariffs were initially set at 25% and increased to 50% on June 4th. Steel worker jobs are good union jobs and in my view, quite worthy of tariff protections when needed. Year-to-date, industry stock values are up 14% on the news; meanwhile, workers in Northern Minnesota were laid off in March and the layoff is expected to last so long that the Minnesota legislature has extended unemployment benefits for the miners from 26 weeks to a year. Tariffs help, but absent other factors, they are likely to boost profits without any impact on workers’ lives.
Furthermore, while tariffs designed to protect existing jobs can move fast, tariffs designed to reshore jobs to the U.S.–if designed by the labor movement–would probably start low, gradually increase over time, and be submitted to congress to make them long term and sustainable. Businesses are unlikely to build new factories that cost hundreds of millions dollars each (and take years of planning) if they cannot count on the tariffs being in place after the factory is built. Tariffs that are subject to a President’s decision (as opposed to those passed by Congress) are not designed to be long-term and the changing nature of the tariffs and shifting rationale for them leaves labor leaders like Shaun Fain of the United Auto Workers (UAW) flummoxed. In a YouTube video about the tariffs, Fain voiced the concerns of his Union as follows,
“We support use of some tariffs on automotive manufacturing and similar industries. We do not support tariffs for political games about immigration or fentanyl…We do not support reckless tariffs on all countries at crazy rates.”
According to Fain, tariffs that protect union jobs at US Steel, General Motors and Ford from low cost imports from China and Japan have the full support of the labor movement. Tariffs that raise prices on goods and lower our standard of living, without creating good jobs would not advance the interest of working families. The tariffs so far, might result in deals of some sort with other countries (on fentanyl or some other goal) but they probably won’t bring back good jobs as they are currently designed.
Less #3: The Apocalypse has Four Horsemen
Free trade agreements are not the only tool corporations use to make good jobs suck today. We now have to deal with de-unionization, automation, and workplace fissuring too. There are four horsemen at this apocalypse, and dealing with just one means the good jobs are still dead. Even if Trump changes the shape and structure of the tariffs in ways that incentivize a return of factory jobs, the tariffs alone are not enough to restore working class communities to prosperity.
Some argue that more manufacturing jobs were actually lost due to automation more than offshoring (https://www.nber.org/papers/w28920). If you prefer a more visual way to view factory job loss to automation, check out the fully automated factories on YouTube like this one: https://www.youtube.com/watch?v=2tLim5pkfOw. We need a thoughtful policy about automation that results in higher pay for the workers when new machines create efficiency. If all the gains in productivity accrue to the bosses, we could bring back factories to the U.S. and still create no new jobs.
Even where local factory jobs continue to be needed, today, corporations use workplace fissuring strategies to hold down pay and benefits. What is fissuring? It is where employers use creative legal structures to pretend the real employer is… someone else. These structures include subcontracting relationships, franchise agreements, and the endless series of corporate organizations that prevent workers from getting ahead. Consider Amazon–one of the largest and most profitable companies in the world. Amazon rarely employs workers directly to drive trucks or work in warehouses. Instead, workers are hired by sub-contractors, so even when workers organize a Union to better their lives, Amazon can just cancel the sub-contractor and prevent the workers from getting ahead at all. Subcontracting also shields Amazon from liability for injuries in the warehouses. By using sub-contractors, employers like Amazon prevent class action lawsuits that could threaten their profits because workers can only sue the tiny sub-contractor, which by design has very few assets. Thus, even as a company like Amazon can determine every policy, wage rate, and working condition in every warehouse, they have no responsibility for the workers or liability when things go wrong.
Unions would address the workplace fissuring issues by properly recording the company that exercises the most meaningful power over the workers as the true employer (or co-employer) when it comes to deciding workplace issues like Union status, liability, and workplace safety matters. Without addressing the issues of the fissured workplace, workers won’t have the power to bargain wages and benefits of factory jobs again like we did before 1990.
So, How Should Union Members Feel About These Tariffs?
The tariffs that protect good Union jobs in auto and steel are clearly welcome and a huge improvement for working families! But the tariffs that are about leverage to negotiate over other topics are a net negative, as they reduce our living standards without the benefit of creating good jobs. Tariffs that are about reshoring work should start slowly and grow steadily, and should be submitted to Congress so they create long term incentives to reshore jobs.
While potentially useful, tariffs need to be part of a much bigger program that addresses all four horsemen of the good job apocalypse to truly create jobs that bring prosperity back to working class communities. We need to end the global free trade con, make it easier to organize unions, and address the issues of automation and workplace fissuring.
The tariffs we have seen so far were created by billionaires and excluded the voice of organized labor. So, who do we expect to benefit from these tariffs? Well, you already know–in the absence of other policies, these tariffs will help corporations and shareholders get richer while working families continue to be left behind.
Read more about SEIU HCMNIA President Jamie Gulley here.
LEGAL DISCLAIMER: The commentaries herein represent the authors' personal views and opinions only, not the Union's official position. Content is for educational and entertainment purposes only. Readers should evaluate independently and seek additional sources. The Union, its Executive Board, Officers, Staff and membership neither endorses these viewpoints nor assumes liability for actions taken based on this information.
