The Wages of Spin

Jon Perr

As I wrote recently, the White House is increasingly frustrated by Americans' continued pessimism with the President's handling of the economy. Perhaps President Bush can find some solace that he seems to draw his greatest support in precisely those states where conditions are the worst for American workers.

That would appear to be the central finding in a report just released by the Political Economy Research Institute at the University of Massachusetts. The report, titled "Decent Work in America: The State-by State Work Environment Index 2005", offers an assessment of the best work environments in the United States. The top five states were Delaware, New Hampshire, Minnesota, Vermont and Iowa, the bottom five were South Carolina, Utah, Arkansas Texas and Louisiana. Oregon ranked a disappointing 36th. (For the full data tables, analysis and methodology, see the report's technical background paper.)

As a rule of thumb, if your state voted for George W. Bush, workers there don't have it very good. Four of the top 5 states voted for John Kerry for President; all 10 bottom dwellers are residents of President Bush's Red America.

Here's why. The Work Environment Index (WEI) rates the quality of Americans' working lives by a weighting of three factors: job opportunities, job quality, and job fairness. Job Opportunities includes the statewide unemployment rates, the duration of unemployment, and the percentage of "involuntary" part-timers. Job Quality refers to average wages (importantly, adjusted for the cost of living) and the proportion of workers receiving health and pension benefits. Job Fairness measures each state's percentage of low-wage workers (an indicator of income inequality), pay differential between men and women, minimum wage levels, collective bargaining rules and importantly, whether it is a "right to work" state. (So-called "right to work" states prohibit workers from being required to join a trade union as a condition of employment.)

The results contain some surprises at the top of the Work Environment Index. States like Delaware and New Hampshire feature low unemployment and good paying jobs after adjusting for the cost of living. Vermont is aided by its number one ranking in workplace fairness. While New England and Mid-Atlantic States generally rate in the top 20, reliable blue states such California, Oregon and New York are rated 33rd, 36th and 37th respectively. More than their unemployment rates (as with Oregon), New York and California drop in their rankings due to pronounced income inequality (think Wall Street and Silicon Valley).

There are no surprises among the worst performing states in the Work Environment Index. Virtually all below the Mason-Dixon line, the WEI laggards feature dismal pay and an outwardly hostile environment towards union organizing, workers' rights and collective bargaining. Red America is the home of the Right-to-Work (RTW) states. A leader in the Right-to-Work movement, Bush's home state of Texas was ranked 50th, with the percentage of workers with health and pension benefits running a full 10% below the top WEI performers.

For conservative commentators such as the National Review's Rich Lowry, these bastions of union-bashing should be lauded, not chided, and celebrated as the future of the American economy:

"Unencumbered by the legacy costs of the Big Three, free of the drag of unionization, highly flexible and efficient, Japanese and other, smaller foreign car companies are thriving in the South."

During a photo-op at a John Deere plant in North Carolina on Monday, President Bush claimed "this economy of ours is on the move." Not, apparently, for many American workers. And certainly not in any state that voted for George W. Bush.


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    For conservative commentators such as the National Review's Rich Lowry, these bastions of union-bashing should be lauded, not chided

    This is the real debate for the American economy, but one we rarely see. The conservative vision is one in which businesses are successful, unregulated, and not beholden to the wellbeing of their workers (see efforts to shift pension costs to Uncle Sam). In this model, the flow of money goes to the management and ownership class, and although there's no evidence to support it, this should somehow trickle-down to benefit the workers.

    On the other side, progressives look to a time, say midcentury, when big businesses were heavily regulated and taxed. They were responsive to their workers, who in turn were the consumption engine that caused the economy to boom. Call it the trickle up model.

    What's patently obvious is that the current conservative model benefits only the already-wealthy owners and managers: it neither helps the middle class nor spurs the larger economy to substantial growth. The midcentury model, by comparison, resulted in one of the greatest economies in American history, which in turn enriched a middle class, which helped create the prosperity to turn the US into a superpower. The only "losers" in this model are the wealthy, who must struggle by with just somewhat more moderate levels of lucre.

    (Great post, by the way.)

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