Fed must stop tipping the scales for the bosses after Amazon workers’ union victory | Robert Reich

On Friday, Amazon — America’s richest, most powerful and fiercely anti-union company with the second largest workforce in the country (union-busting Walmart is the largest) — lost to a group of New York warehouse workers who voted to form an association.

If anyone had any doubts about Amazon’s determination to prevent this, last fall’s anti-union scorched-earth campaign at its warehouse in Bessemer, Alabama, should have dispelled those doubts.

In New York, Amazon used every tool it had used in Alabama. Many of them are illegal under the National Labor Relations Act, but Amazon doesn’t give a damn. It’s rich enough to pay any fine or take any PR hit.

The company has repeatedly fired workers who speak out about unsafe working conditions or even suggest that workers need a voice.

While his company’s coffers are bulging with profits – and its founder and CEO practices conspicuous consumption on a scale not seen since the robber barons of the late 19th

Much of the credit for Friday’s win over Amazon goes to Christian Smalls, whom Amazon fired in spring 2020 for speaking out about the company’s failure to protect its warehouse workers from Covid. Smalls refused to back down. He went back and, with exceptional skill and tenacity, organized a union.

Smalls had something else in his favor, which brings me to Friday’s excellent job report from the Bureau of Labor Statistics. The report showed that the economy continues to spring to life in the wake of the Covid recession.

With consumer demand increasing, employers are desperate for employees. This has given American workers more bargaining power than they have had in decades. Wages have increased by 5.6% in the past year.

The acute demand for labor has bolstered the courage of workers to demand better wages and working conditions, even from America’s most aggressively anti-union companies, such as Amazon and Starbucks.

Is that something to worry about? Not at all. American workers have barely received a raise in more than four decades. Most of the economy’s profits have gone to the top.

In addition, inflation is so high that even a wage increase of 5.6% over the past year is minimal in terms of real purchasing power.

But American companies believe these wage increases are contributing to inflation. Like the New York Times solemnly reports that wage increases “could fuel inflation”.

This is pure rubbish. Unfortunately, Federal Reserve Board Chairman Jerome Powell thinks so. He fears that “the labor market is extremely tight” and “at an unhealthy level.”

As a result, the Fed is on course to repeatedly raise interest rates to slow the economy and reduce American workers’ bargaining power.

Pause here to consider this: This is what the trading department reported on Wednesday Corporate earnings are at a 70-year high. You read that right. Not since 1952 have companies done as well as they do today.

Amazon’s profits are in the stratosphere, but it’s not just Amazon. Across the board, American businesses are awash with cash.

Despite paying higher costs (including higher wages), they still managed to increase their profits. How? They have enough pricing power to pass those higher costs on to consumers and add even more for themselves.

If American corporations are overflowing with money like this, why should they? salary Are Profits Fueling Price Hikes, The Times Reports? In a healthy economy, companies would not pass on higher costs – including higher wages – to their consumers. They would pay the higher wages out of their profits.

But that doesn’t happen. Companies are using their record profits to instead buy back massive amounts of their own stock to keep their share prices high.

The labor market is not “unhealthily” tight, as Jerome Powell claims; Businesses are unhealthily fat. Workers don’t have that much power; corporations do.

The extraordinary victory of workers at Amazon’s Staten Island warehouse is cause for celebration. Let’s hope this is the beginning of a renewal of workers’ power in America.

The reality, however, is that American companies don’t want to give any of their record profits to their workers. If it cannot fight the unions directly, it will do so indirectly, blaming wage increases for inflation and then cheering on the Fed, which slows the economy just enough to eliminate American workers’ new bargaining power.

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