Book Review

A race to the bottom organized labor in North America. Within this neoliberal framework, And as Caulfield argues, these ef- organized labor would suffer de- fects have been negative. clines in compensation, working NAFTA and Labor in North America. The book begins with a historical conditions, and workers’ rights. By Norman Caulfield, Champaign, overview of the rise of organized NAFTA is characterized as the IL, University of Illinois Press, 2010, labor in North America from 1850 logical next step in the expansion of 264 pp., $70/cloth; $25/paperback. to 1970. Out of tumultuous begin- global capitalism. Of greater impor- nings, the first few decades of the tance to the present discussion is the With a recession having just ended 20th century saw unions grow rap- North American Agreement on La- in March 1991 and its effects still idly and win important political and bor Cooperation (NAALC). As a side fresh in the minds of the voters, the legal victories. Notwithstanding the agreement to NAFTA, the NAALC state of the economy became the occasional setbacks unions suffered was designed to monitor violations primary focus of the United States throughout the 1920s and 1930s, against each country’s labor laws presidential election of 1992. One the decades immediately following and settle labor disputes. Caulfield particularly contentious issue was World War II would represent a reports an extensive list of violations whether the proposed North Ameri- “golden age” for organized labor and filed with the NAALC that includes can Free Trade Agreement (NAFTA) the economies of North America dangerous working conditions, gen- would prove to be beneficial or det- as well. By the mid-1950s, union der discrimination, preventing the rimental to the working class citi- density in Canada and the U.S. organization of labor, and paying zens of the United States. In what would climb to one-third of non- illegally low wages, to name a few. must be considered the single most agricultural employment. Unions TheNAALC has been mostly ineffec- famous quote associated with the in Mexico also experienced gains tive, according to Caulfield, because NAFTA debate, Ross Perot warned in terms of greater representation in it has no coercive power. Ironically, that, if NAFTA were ratified, “there political and economic matters dur- the NAALC has had an effect exactly will be a giant sucking sound going ing this period. the opposite of its intended purpose. south” as U.S. industries head across According to Caulfield, this period Tasked with monitoring violations the Mexican border in search of of prosperity was made possible be- and ensuring that the letter of the cheap labor. Nearly 20 years later, the cause international trade was insig- law was observed, an unintended in- question naturally arises: Did Perot’s nificant, implying that production centive was created to reduce the le- prediction turn out to be true? and economic policies were directed gal rights of workers for the purpose While it is not the purpose of predominantly toward the domes- of reducing labor costs, attracting Norman Caulfield’s book to answer tic economy. Under the conditions investment, and avoiding NAALC this specific question, NAFTA and of limited foreign competition and censure in what Caulfield describes Labor in North American neverthe- strong economic growth, unions as a “race to the bottom.” less sheds light on this issue in the were in an advantageous position to The response to globalization by course of articulating a broader bargain for higher wages and ben- unions has been to align their in- narrative. Two other qualifications efits and better working conditions. terests with firms and accept con- deserve mention. In reference to the The recessions, declining profits, cessionary bargaining. Caulfield book’s title, the scope of the work en- and increased foreign competition accuses union leaders across many compasses economic forces that are of the 1970s would transform the industries of partnering with man- more general than those associated political and economic landscape agement to help rollback the gains with NAFTA alone. Furthermore, to the detriment of unions. In the previously won by unions. Under the the book is largely concerned with 1980s, the three North Ameri- threat of plant closures, declining only a subset of the total labor force can countries elected conservative, union membership, and a shrinking rather than its entirety. The content market-oriented political leaders all base of union dues, labor leaders ap- of the book is, therefore, more accu- of whom sought to expand interna- pear to have placed their own self- rately described as a characterization tional trade, reduce social spending, interest above the collective interests of the effects of globalization upon and deregulate or privatize industry. of the rank and file. Within some

42 Monthly Labor Review • December 2010 industries, union leaders were given U.S. reveals that manufacturing as decline in union density far better official corporate positions and stew- a share of total non-farm employ- than manufacturing and this can be ardship over union funds, which ment has exhibited a continuous, explained in part by the cost of im- placed them in the debt of firms. uninterrupted decline from 35 per- porting services. Moreover, the shifting of health cent in 1945 to 9 percent in 2009. These issues aside, Caulfield’s care costs from firms to unions Even during the prosperous years book can be praised as a detailed, through Voluntary Employees’ between 1945 and 1970, manufac- well-researched historical portrayal Beneficiary Associations VEBA ( s) turing’s share of total employment of the effects of globalization on has made some unions large share- decreased by 10 percent. At the labor unions in North America. holders of the same corporations in same time, U.S. manufacturing out- Moreover, as the former director of which they are organized, thereby put steadily increased. While this research for the Secretariat of the creating an interest in reducing la- reviewer does not dispute the fact Commission for Labor Cooperation, bor costs to maximize the value of that U.S. manufacturing jobs have he presents an authoritative account the VEBA. Accordingly, Caulfield moved abroad, Caulfield seems to of the labor law violations occurring finds the response by union leaders suggest that technology is the great- since the inception of NAFTA and of to be completely ineffective, if not er long-run threat to manufacturing the Commission for Labor Coop- wholly contemptible. employment, both here and abroad. eration’s inefficacy in resolving these In the concluding chapter, several If productivity continues to increase violations. Overall, the presentation prescriptions are offered for the fu- through technological advances, it is accurate and balanced. ture direction of organized labor. is conceivable that only 2 percent NAFTA and Labor in North America Caulfield advocates that workers of total employment will be needed will likely find its greatest apprecia- organize internationally, but inde- to manufacture everything society tion within academia, primarily as pendently of the established trade needs in the future. In this scenario, a supplemental text in economics unions. Labor is urged to promote it would be neither possible nor de- courses. It would be useful in labor equal rights for all migrant work- sirable to prevent the secular decline economics courses that empha- ers. Lastly, workers are encouraged of manufacturing employment in size the study of organized labor. to seek not only economic gains, but this reviewer’s opinion. The book is equally well-suited for greater political influence as well. A second issue of relevance con- courses in international economics Acknowledging Caulfield’s in- cerns the organizational strategy of as it can provide a counterbalance tended purpose, this reviewer be- unions. If globalization is prompting to the welfare arguments made in lieves it is fair to raise a few broader firms to move abroad, maybe labor favor of free trade agreements that issues of relevance to the general unions should give up attempting too often ignore the impacts on los- arguments presented in the book. to preserve jobs in those industries ers from these arrangements. This is The first issue concerns the interpre- that are subject to intense competi- not to say, however, that the book tation of trends in manufacturing tive pressures and relatively easy to will not appeal to the general public. employment. Caulfield’s discussion relocate. As long as goods, services, Interested readers will find it -ac is framed squarely in terms of the and financial capital are free to cross cessible and readable. Members of impact of globalization on unions international borders, pressing for labor unions who are interested in specifically within manufactur- higher wages in some industries the future of organized labor should ing industries, which makes logical (e.g. manufacturing) will likely not perhaps regard this book as required sense because the manufacturing be successful. Unions might find reading. industries are at greatest risk of greater success in organizing indus- —John Kenneth Krantz crossing international borders. Is tries that produce goods or services Economist globalization to blame for the loss of that are prohibitively expensive to Utah Department of Workforce U.S. manufacturing jobs? Current trade internationally. The service Services Employment Statistics data for the sector has weathered the general Salt Lake City, UT

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