It’s about power, not income equality

During the Cold War, the demand for higher pay became the demand for “income equality.” The reason appeared obvious: for the past five decades the income gap between the top and bottom has grown rapidly.

Today, according to inequality.org, the top 1 percent of wage earners receive about 20 percent of all income paid to workers in the U.S. labor force. The top one-tenth of 1 percent of income earners, or about 31,500 people, have an average household income of $43 million, which is 1,807 times more income than the average in the bottom 20 percent.

Decades of calls to close this gap that have gone nowhere as the income and the even-worse wealth gap have grown worse.

The solution to this is not to close the gap but to end the gap. The only way to do that is to democratically share the output of the economy for all of us who produce it with our labor.

Because our wages and benefits are only a fraction of the value of what we produce, the real income inequality is what the boss keeps and what we get as pay. That’s true in our own workplace and the economy as a whole.

Since 1980, the growing share of output, or what economists call “productivity,” going to wages has declined significantly. According to the Economic Policy Institute, between 1949 and 1980, the rise in the share of total output going to wages matched that of productivity. After 1980, the gap grew every larger. By 2021, 48 percent less of the share went to wages.

The only way to get our fair share of what is produced by our labor is to have democratic control of the workplace and economy. Having power means a group of workers overcome the divisions of race, gender and sex to organize together. We share concerns about how things should be organized, how and how much we work, what we make or do, what is safe and who makes the decisions. We organize and take action. This is the kind of power many of us strive for every day at work. That’s why we have unions.

Not surprisingly, this kind of power threatens the few who own the bulk of this capitalist economy or run the government to serve them. Power at work is not the same thing as income inequality. Income equality has nothing to do with power over work, only how the fruits of our labor are distributed.

The term income inequality tells us a lot about those who use it. During the Cold War, the politics of class struggle was not only suppressed by McCarthyism but also by the top leadership of the AFL-CIO, which purged several national unions, such as UE, for being too committed to fighting the boss and capitalism.

This repression found its way into our language. As I wrote in a January column, scholars, union leaders and politicians first replaced “class struggle” with “class conflict” and then eliminated all references to the “working class,” making us all “middle class.”

At the same time, labor-management committees and interest-based bargaining, in which our unions collaborated with employers to make us work harder for less pay, replaced the struggle for workers’ power on the shop floor. At the very time the workers movement was at its height of power our union leadership traded it away in exchange for small wage bumps and more work.

As Kevin van Meter and I wrote about on these pages, management-rights clauses seeped into our CBAs contractually transferred our power over work to the boss and no-strike clauses tied our hands.

Since the workers’ movement became narrowly focused on raising wages, sociologists subtly replaced the struggle for power with the social problem of “income inequality.” Class as power was replaced by the new category of “social class” focused on our income, housing, level of education and even cultural traits.

At the same time, political scientists invented a new term called “pluralism” to explain how social change happens as the result of competition between “coalitions” of “interest groups” in the electoral arena. Gone is the class struggle between the elites and workers.

According to pluralism, unions are interest groups that advocate on behalf of their members rather than the entire working class. This is why our unions are called “special interests.” Members are portrayed as voters who elect their representatives (officers, for example) who partner with the employer to negotiate private legislation called CBAs. Members’ interests are no longer about controlling our work but have become a demand for higher wages to move us out of the working and into the middle class.

Unions have adopted this language and way of thinking and by doing so have invisibly transformed the struggle for power into merely getting a bigger piece of the pie. After 50 years, we now know that both the middle class and our share of the ever-growing pie are shrinking. The extra big slice isn’t coming.

The entire logic is flawed because we don’t need a bigger piece. We deserve the whole pie because we grew the ingredients, transported it, baked it and sold it.

This shift in language is not neutral. It represents an unspoken ideology of classic liberalism that focuses on the opportunity to acquire property rather than a struggle for a democratically run economy by the workers who produce it.

In our unions, such “labor liberalism” is the cause for our decades of defeat. Workers and the boss simply do not have shared interests. You can’t shake hands with a fist.

Today we see that myth coming apart as surveys show a super majority of people support unions, the highest level since 1965, and high support for socialism. Growing unionization, credible strike threats and strikes rising to levels unseen for decades are all signs of the collapse of this liberal ideology.

Next time you hear someone decry income inequality, ask them just how much the richest should still be paid if we reduce the gap.

As long as there is someone at the top they are earning too much. They are getting it because they have the power to take it all for themselves.

To succeed, the workers movement needs the power not merely to take it for ourselves but to reorganize the economy to serve human needs, reduce how much work we really need to do, and end a system that is rapidly destroying most life on this planet, right before our eyes.

Robert Ovetz is editor of Workers' Inquiry and Global Class Struggle, and the author of When Workers Shot Back, and mostly recently We the Elites: Why the US Constitution Serves the Few. Follow him at @OvetzRobert 

We depend on the support of readers like you to help keep our publication strong and independent. Join us.