The Problem With Unions

Is that they are not strong enough. As Seamus Milne explains:

There's nothing that quite so reliably tips the British press into paroxysms of abuse and class contempt as workers having the gall to withdraw their own labour. Or even talking about going on strike, as has been happening at the Trades Union Congress in Brighton this week. All the old tropes have been wheeled out in the last couple of days. These are "mindless militants" and "professional whingers", according to the Mail, the Sun and the Telegraph, determined to "drag Britain back into the dark ages" and holding the public "hostage" as they "squeal like stuck pigs".

You might imagine that years of pay freezes and real pay cuts, attacks on pension entitlements and the loss of hundreds of thousands of jobs – which is what the government has imposed on the public sector – would be a reasonable basis for an industrial dispute for any workforce. Add to that the fact that these cuts are being made as part of an austerity programme opposed by most of the population and spectacularly failing to revive the economy – and industrial action is also an obvious mechanism to intensify the pressure for a change of economic direction.

But as unions voted to back co-ordinated strikes and explore the practicalities of a general strike – industrial routine in other parts of Europe – the most polite criticism was they were "out of touch". For the rest, these were union "boneheaded barons", "pygmies" and "sullen" union "bosses" defending an outrageous (and fictional) public sector largesse. Nearly 200 years after the repeal of the Combination Acts, Britain's corporate media and political class still struggle in practice to accept the right to strike. The focus of the industrial campaign against austerity has now shifted from pensions to pay, with teachers launching a work-to-rule and the likelihood of wider action across public services in the spring. Whether that will prove to be on the scale necessary to force a government retreat is another question. But what is certain is that if workforces don't resist, cuts in pay and jobs will be driven through.

Contrary to the fantasies of anti-union propagandists, the real problem for the British economy is not that unions are too strong, but that they have long been far too weak. Between 1975 and 2007, the share of wages in national income fell from 65% to 54%, while escalating inequality within that smaller share has meant stagnating real wages for low and average earners. A central factor in the shrinking slice of the economic cake going to workers – which helped lay the ground for the crisis of 2007-8 by fuelling personal debt – has been the weakening of trade unions, whose membership halved over the same period. In fact, the fall in union numbers since the 1970s is an almost exact mirror image of the increase in the share of income taken by the top 1% over the same period.

The shadow chancellor Ed Balls was heckled in Brighton today for backing the coalition's public sector pay cap as a trade-off for jobs and a token of Labour's fiscal discipline. But just as stronger unions are essential for greater equality and a better balanced economy, pay restraint now can only further deepen recession. If unions are successful in resisting pay and job cuts, that would boost demand and aid recovery – though it would also need the shift to a public investment and growth strategy the government remains resolutely opposed to. But public sector workers can't be expected to wait for a Labour government or for the coalition to "understand why working people are so unhappy", as Ed Miliband put it in Brighton.

And however welcome the business secretary Vince Cable's conversion to an industrial strategy for the sectors of the future, the half-baked business bank George Osborne has allowed him doesn't begin to reflect the demands or scale of such an investment programme. Meanwhile his scrapping of health and safety regulations for small firms, as Tory leaders chafe at the bit to dump more employment and union rights, is a warning of threats to come. As the struggle over pay builds up, the government will again try to isolate public service from private sector employees, who are of course also suffering real terms pay cuts and large-scale job losses.

Union weakness in the private sector – where only one in seven workers is now a member, compared with the majority in the public sector – is the product of decades of industrial change, fragmentation and anti-union legislation. But a string of private sector strikes this year – including on the buses, in construction and at Honda – has given a taste of how that can be turned round. Success has depended on bolstering industrial action with campaigns targeted at suppliers and executives, as well as working with protest groups such as UK Uncut and the Occupy movement. That is now likely to be extended to occupations and other forms of direct action, if Unite's leader Len McCluskey has his way. Such calls are regarded with horror by the political and media class. But the business unionism and supine "social partnership" they favour failed to protect jobs and living standards. Employers and politicians trampled all over it. Which is why the trade union movement now has its most radical leadership in modern times – and its most progressive general secretary, Frances O'Grady.

A generation after Thatcher's assault on the trade unions, they are still treated as dangerous or embarrassing outsiders. In reality, they are not only far and away the largest voluntary organisations in the country, but now the only major area of public life where working class people are properly represented. Their agenda on recovery, jobs, services, inequality, privatisation, public ownership and the democratisation of economic life is closer to where public opinion is than the main parties' front benches – as Bill Clinton's former pollster Stan Greenberg underlined this week with his finding that voters want "fundamental change" in the way the economy and country works. And contrary to the way they are portrayed, unions are popular – as often are the strikes they call. Last November's public service walkouts were backed by almost 80% of young people. As the Tories prepare a new legal straitjacket and Labour frets about being seen as too close to the unions, their members will be at the heart of the battle over who pays the cost of this crisis.