The trend I see in the U.S. is the waning of the neo-liberal ownership society championed by U.S. presidents from Ronald Reagan to Bill Clinton to Barack Obama. Reagan famously defeated labor in the air traffic controllers strike of 1981. Wisconsin governor Scott Walker drew an analogy between his standoff with the Wisconsin unions and President Ronald Reagan's decision to fire striking air traffic controllers in 1981.
"This is our moment," he said. "This is our time to change the course of history."
But labor has been fighting back vigorously and seems to be energized by Governor Walker's attack. Regardless of the outcome of this battle, I think labor is on the upswing.
A previous defeat of the neo-liberal ownership society occurred during Bush-43's 2005 attempt to privatize portions of Social Security. That proved to be a major political turning point, as Democrats went out to capture Congress in 2006 and the presidency in 2008. Obama initially adopted the neo-liberal idea that we need to fix Social Security, but has recently backed off:
Obama administration officials are rejecting the idea of making major changes to Social Security as part of a debate over reining in the national debt, a stance that’s drawing protests from deficit-cutting advocates.White House Budget Director Jack Lew and Jason Furman, deputy director of President Barack Obama’s National Economic Council, both stressed this week that Social Security isn’t facing an immediate funding crisis and should be viewed separately from moves to reduce the federal budget deficit.
Most political observers interpreted the Republicans' massive victory in the 2010 elections as sign that the Reagan Revolution will resume, with the public demanding smaller government. Indeed, this is what the public is getting, as state and local governments are forced to cut back.
My feeling, as articulated in previous blog posts, is that the economy will slip back into recession and that Republicans will win the election in 2012. They will run into the same economic wall that Bush-43 hit and will fall on their faces again. At this point, the public will be ready for more progressive, labor-friendly leadership.
Thus, from my perspective, the battle in Wisconsin is laying more of the groundwork for a resurgence in labor power. While the battle is ultimately likely to go in favor of the Republicans in the narrow sense, the Republicans continue to take ownership of our failing economy.
And this mirrors much of what is happening on the international political-economic scene. Conservative Angela Merkel recently suffered big losses in Germany. Austerian conservatives have taken power in the United Kingdom, and the economy is heading downhill. Berlusconi in Italy is toast, and Sarkozy's popularity is at a record low in France.
What about the Middle East? There is little doubt that global economic conditions have played a big part in the recent uprisings. The vast majority of middle class wage earners have demanded more power. Entrenched political-economic monopolies are out, and labor is in, at least in terms of the popular zeitgeist.
So there does seem to be a commonality to the events of Wisconsin and the Middle East. In each area, an energized popular movement is at work. In Wisconsin, labor is repulsing an attack by the forces of Reaganomics. In the Middle East, popular movements have toppled existing economic power structures. To what extent is labor involved in the Middle Eastern uprisings? My guess is that labor is the prime ingredient. Certainly the uprisings have not been dominated by narrow factions. Human rights, including labor rights, have taken center stage.
Meanwhile, in Wisconsin, the backlash is not restricted to a narrow partisan group of self-centered workers. Protests are being held in all 50 states, and efforts to divide public workers (e.g. police and firefighter vs teachers) are meeting concerted resistance. GOP efforts to divide labor may not fair so well in the current economic environment. Which emotion will prevail: Anger directed at teachers because they get good benefits, or Anger directed at Republicans because their policies result in no good benefits for any workers? Already, several Republican governors have backed away from the position of the Wisconsin governor, while Democratic solidarity on this issue is impressive.
Stepping back, this looks like a second major setback for the neo-liberal ownership society advocates. The first was the defeat of Social Security privatization in 2005. When the smoke clears from the current battle, we are likely to see a significant shift leftward in the Democratic party and concomitant energizing of the base. Whether Obama is able to tap into this remains to be seen. Obama has spent the first two years of his administration burnishing his neo-liberal (Clintonian) credentials at the expense of his party's base. If and when the economic relapse that I forecast occurs, then the labor resurgence may be swamped by dissatisfaction with the status quo, and Republicans may get another chance to perform a full Mubarak...
