Introduction
On September 18, union workers for the Nabisco corporation, producer of treats such as Oreos and Fig Newtons, voted to end their five-week strike. The strike that began in Portland and spread across the country was sparked by a proposed contract that would result in the bakery workers losing their overtime opportunities, while putting them on a lesser healthcare plan. This week’s installment of The Conversation will seek to explore the labor rights issues surrounding the strike and the tentative agreement ratified between the union workers and Nabisco management.
In the following sections, controversy around these issues will be explored by Peter White, Campus Liberal, and Jackson Hudgins, Campus Conservative. First, Peter will share his opinion, followed by Jackson’s and a final synthesis from the two sides.
Campus Liberal, Peter White
If only the full story could be summarized in that introduction section. The truth, simply put, is that the United States has a massive labor rights problem. In July, Frito-Lay workers in Kansas stopped work for 20 days in protest of “unrelenting work conditions.” On September 14, just a few days ago, some 400 distillery workers in Bardstown, Kentucky formed another picket line, requesting respect, fair pay, and fair work schedules. The common thread between them all? Large corporations in America are cutting costs in the form of wages and healthcare for their employees.
In this week’s example, some workers stand to lose over $10,000 annually because of Nabisco’s choice to cut back overtime opportunities. All while new employees were slated to be put in a secondary tier of healthcare benefits with worse coverage at a higher cost.
Of course our spotlighting of this issue comes at a time of pandemic-related recession where many small businesses are struggling to fill job openings despite high levels of unemployment. These companies are finding it difficult to pay people a competitive wage in an environment where their stores might not be as profitable as they once were. This makes the issue of striking union workers a bit more complex, as employers may not be able to meet their workers’ requests.
On the other hand, Mondelez International (parent company of Nabisco) raked in over 2.5 billion dollars in the second quarter of 2021. During the last year of the pandemic, it had a gross profit of $11.261B, which is a ridiculous 12% higher than previous years. The companies that we are talking about right now, who choose to cut their workers’ benefits and salaries, are not the companies that are struggling as a result of Covid. Perhaps in another week we will address the complex issues surrounding the success of small businesses in America, but not this week. The takeaway from this week is that these large corporations will ruin the lives of the people who make their products for another quick buck. America has a long history of workers’ movements, and COVID-19 may have catalyzed the next. My hope is that this piece will help us all to be aware of and support the labor that makes everything you use or eat.
Campus Conservative, Jackson Hudgins
At first glance, this seems like a very cut-and-dry case of evil employer vs. oppressed worker, but the reality is that there is a lot more nuance to this case. The reality is that the labor market in the United States is far from perfect, and it has prevented a lot of progress toward an equitable and well-established workplace. The reality is that the government of this country has so manipulated the market for labor and supply that the entire economy suffers in a myriad of ways, from suppliers to customers.
To begin, the regulatory environment and tax rates in this country have disincentivized employers and businesses from expanding their workforce and raising wages naturally. The cost of compliance and operating has often become so high that productivity cannot be raised to make a profit. The corporate tax rate in the US is higher than most of the western world—21%, which hits small- and medium-sized businesses (LLCs and such) quite a bit. Other mandated benefits, like healthcare under the Affordable Care Act, add even more to these costs. Because of this, wages and other benefits must be depressed to make up for cost, and crisis/recession events hit a business much harder and more negatively than they normally would in a normal market.
In addition, the rise in the minimum wage as of late has further decreased benefits to employees and has also increased unemployment. As economist Thomas Sowell once said, “Unfortunately, the real minimum wage is always zero, regardless of the laws.” The reality is that regardless of how high the minimum wage is, an employer can simply respond by cutting the workforce to make it viable to pay their workers. They will also find ways to cut benefits or other expenses so that they can continue to function with the new wage. In addition, unionized workers cannot expect to simply get everything they ask without pushback; you cannot expect a business to remove the profit that they expect to use for marketing, debt, and other capital costs to satisfy every single demand.
Today’s labor environment in the United States is far from simple, and employees and employers should come together to find common sense solutions that both respect the right to collective bargaining and the employer’s right to run a successful business.
Conclusion
Both sides visited in this week’s conversation agree that the American labor situation leaves much to be desired. The workers deserve better, regardless of an individual’s preference for what better means. The culture and legal environment around labor rights in America poses serious questions on how to improve our nation in ways that any Stevens student should be aware of as they prepare to enter the workforce.
The Conversation is an Opinion column written by two students of opposing political viewpoints, used to discuss current events from different perspectives.
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