Labor, Past and Present: Shawn Fain and Sidney Hillman

The boardroom at Amalgamated Bank is named after Sidney Hillman. As you enter through the vestibule, you’ll notice an impressively large plaque with the names of the founders of Amalgamated. The room itself has perhaps twenty seats around the table, and another dozen or so against the walls. The East side of the room has a giant screen and a camera for video conferences.  The west side of the room has a counter where they usually put catered food. And finally, above that is a mural of Sidney Hillman.

During a recent board meeting, I was looking at the picture of Mr. Hillman and thinking about how he reminds me a great deal of Shawn Fein, a labor leader in the news quite a bit these days. Before he founded a bank, Mr. Hillman worked for a clothing manufacturer in New York making expensive men’s suits. Eventually, he and some of his colleagues decided that they wanted to insist on higher pay and better working conditions and that they were willing to go on strike to get them.  The leaders of their union – which did not include Hillman – met with the company owners and … decided to capitulate and accept the company’s offer.  The workers were not happy, did not accept the deal, and continued their strike.  Some workers, backed by the capitulating union leadership, did not honor their picket lines. The stalemate lasted for years, but eventually Hillman and the workers’ side prevailed.  I doubt that anyone even remembers the name of the AFL-affiliated union that settled, but Hillman’s grandchildren’s grandchildren will know what he created: Amalgamated Clothing Workers, and the Congress of Industrial Organizations (CIO) which merged with the AFL many years later to form the AFL-CIO.  After founding the union, Hillman would go on to found the Amalgamated Bank.  Back in the day, worker-owned businesses were commonplace, but the Amalgamated Bank is currently, as far as I know, the only for-profit business owned by a labor union.

Shawn Fein, the current head of the UAW (United Auto Workers), has a lot in common with Sydney Hillman.  They both became the heads of powerful unions specifically because they watched certain union leadership accommodate employers, forgetting that they were supposed to be representing the workers.

I have often said that even our best political leaders spend much of their time with the major donors, so it’s easy to see how even the fiercest advocates can become very familiar with, and sympathetic to, the issues of those major donors.  Some labor leaders may have more-or-less the same problem.  After years of working with the company management, they eventually become part of that group, and become sympathetic to the needs, wants, desires, and goals of the company management.

Then came the 2008 “financial crisis”.  Banks that had been considered secure for a century suddenly were no more.  Bear Stearns, Lehman Brothers and Merrill Lynch were acquired by other firms for a tiny fraction of what they were worth a few months earlier.  AIG, Citigroup, and General Motors accepted huge financial investments from the US Government (which turned out, years later, to be profitable for the government, but that’s a different story).  The unions agreed to many incredibly painful concessions, including ending defined benefit pensions, letting the company off the hook for health care benefits for retired workers, and ending the “job bank” program, which enabled workers to continue being paid if their work was temporarily not needed. These changes lowered overall labor costs for the companies without lowering the nominal wages of the workers. But the economic cost for the workers was nevertheless severe.

After the givebacks in 2008, a dozen senior officers of the UAW were convicted of serious corruption, and Shawn Fein was elected after the union changed its rules so senior leaders were elected by the members.  The previous system was more complicated than the electoral college, with elected local leaders selecting people to fill official positions, who selected other people, who eventually selected the senior executives.

Put simply, Shawn Fain is fighting to improve the lot of workers. But he also represents something about our political moment: its potential. Let’s try to help our nation follow the lead of Fain, Hillman, and the auto workers:

  • Send corrupt leaders to prison
  • Change our election rules so that whichever side has the most votes wins.
  • Elect new leaders who will represent the workers, not the managers and investors

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