Income inequality between the rich and the poor continues to be a significant concern in the United States, prompting national headlines and serious political debate regarding governmental policy. Historically, economies based on capitalism tend to have a pro-business stance, implementing pro-business policies to spur economic growth (Zinn, 2010). The typical role of the labor union has been to help improve economic equality between workers and the companies that employ them; however, unions have also helped their members pursue political action and influence the electoral process to achieve their aims as well (Hodson & Sullivan, 2008). Beyond unions, non-governmental organizations also pursue political action to address broad social issues like income inequality. Increasingly, both unions and NGOs are spanning national boundaries to deal with inequality issues that effect workers due to the increased influence of multinational corporations and the issues that arise from the globalization of work and trade. As NGOs and unions grow beyond national boundaries, what advantages or disadvantages are at play, that influences their effectiveness? How beneficial are NGO programs that attempt to deal with income inequality issues?
The rise of large multinational corporations has resulted in a situation where, “two hundred of that largest corporations control over 80 percent of the assets of the Western world” (Hodson & Sullivan, 2008, p. 388). Multinationals have tremendous influence in both their home countries and the less developed countries where many plants are located. Additionally, multinationals have a single duty or aim, which is “simply to maximize financial returns for investors” (Bibby, 2004, p. 16). Their nearly singular focus on maximizing financial returns has led work being exported to countries that have lower labor costs and in many cases do not afford the same legal protections for workers as developed countries. For example, child labor produces goods in sweatshops located in developing countries; goods that make their way into the supply chains of major multinational retailers (McDougall, 2008). In addition, when work moves to developing countries, there is an impact on the workers in developed countries that lose their jobs to lower cost labor pools; namely costs that are transferred to the public sector like unemployment or retraining for workers (Bibby, 2004).
To more effectively deal with issues raised by multinationals operating in an integrated global economy, there are a growing number of international labor organizations including UNI Global Union, a global union that represents 900 trade unions and 20 million workers (“UNI Global Union,” 2011). There are several advantages in using a global, federated approach to labor unions, namely a larger pool of workers that provide the basis for union influence, greater coordination on issues that span national boundaries and the resulting ability to influence the policy and business decisions of large multinationals. The most significant disadvantage to a global, federated approach to unions is the increased scope and complexity of problem that arises from the requirement to represent a large diverse constituency with diverse needs. For instance, in the case of outsourced jobs, the recipients of new jobs may not appreciate interference, while the workers whose jobs are moved may desire intervention. Therefore, global unions are required to focus on larger policy issues like poverty, equality, and exploitation; and do so by negotiating principle-based, framework agreements (“UNI Global Union,” 2011).
In their focus on policy issues, global unions are much like NGOs that focus on income inequality, although NGOs like results.org, United for a Fair Economy (UFE), and inequality.org tend to focus on programs that seek to enable and build grassroots movements, educate people on inequality issues and advocate policy positions, particularly on issues of taxation. As an example, UFE has a projects that advocate for the reintroduction of the estate tax as a mechanism to continue funding of programs to benefit the poor (“Estate and Federal Taxes | United for a Fair Economy,” 2011). Should UFE advocate a successful policy change and influence estate tax legislation to garner additional tax revenues to continue or grow funding for government benefits programs, there could be a positive impact on low-wage workers, providing supplement benefits that help those workers survive; however, it is a significant causal chain between UFE influence and benefits being provided to workers.
Global labor unions and income inequality NGOs are needed organizations that serve to fill the representation gap left by pro-business governments and large multinationals that operate strictly on the profit motive. Both seek to educate people and advocate for change to address a growing income gap, while global labor unions actively seek to negotiate fundamental workers rights with large multinationals. However, neither is well suited to address individual or regional workers issues. As a result, many organizations seek to operate on the principles of federation and collaboration, or as representatives of UNI Global Union suggest, “Act locally, organize globally” (Bibby, 2004, p. 25).
Bibby, A. (2004). The Global Mobiity Revolution. In U. N. International (Ed.), (pp. 25).
. Estate and Federal Taxes | United for a Fair Economy. (2011) Retrieved 22 May, 2011, from http://faireconomy.org/estatetax
Hodson, R., & Sullivan, T. A. (2008). The social organization of work (4th ed.). Belmont, CA: Wadsworth.
McDougall, D. (2008). Child sweatshop shame threates Gap’s ethical image. The Observer. Retrieved from guardian.co.uk website: http://www.guardian.co.uk/business/2007/oct/28/ethicalbusiness.india
. UNI Global Union. (2011, 20 May 2011) Retrieved 22 May, 2011, from http://www.uniglobalunion.org/Apps/iportal.nsf/pages/homepageEn
Zinn, H. (2010). The Twentieth Century : a people’s history. New York, NY: MJF Books.