Prosperity Is for the Many, not the Few

By Tom Ehrich

In my early days with The Wall Street Journal, I helped to cover the steel industry in Pittsburgh.

US Steel had installed a lawyer as CEO. He knew nothing about making or selling steel. His only strategy, as I recall, was to defeat the United Steelworkers union.

As a result, Big Steel missed a critical advance in steelmaking technology and found itself with aged mills making steel that Japan could undersell despite shipping costs. Before long, US Steel was a shadow of its post-war self, other steelmakers were filing for bankruptcy, the great post-war industrial boom was being torched by greedy and clueless management, and the long, relentless slide of the middle class was under way.

This is what happens when management declares war on labor and tries to blame labor costs for corporate woes. Management never sees this, because their ideology blinds them. Too many managers view blue-collar workers as inferior — barely above animals, in the eyes of some steel and coal bosses — and they resent the rise of workers into the middle class.

So they fight unionization, as if defeating unions were a sacred cause. John D. Rockefeller was so incensed at his uppity miners that he sent private troops to slaughter them in Colorado. New England owners moved textile mills south, rather than pay union wages. Now those jobs are in Mexico and Central America, and the one-time textile centers of Virginia and the Carolinas are bankrupt.

On Labor Day, it would be wise for us to remember that America works best when it works for the many, not for the few. When workers receive fair wages, prosperity raises all boats. When management fights its own workers, soon we have a hollowed-out minimum-wage economy where most struggle and one-time managers are greeters at Wal Mart.

This is Econ 101. But to see it, management has to recognize blue-collar workers as people, as fellow-citizens, as valuable partners in the design, manufacture, sale and distribution of products.