Unions in recession

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Blackwell forecasted that the unemployment rate will remain around 10 percent for the next two to four years because the recovery is too fragile to recoup the loss in unemployment.

As workers continue to lose their jobs -- the main cause of bankruptcy -- they lose their homes and self sustaining abilities.  While the government aims to balance the federal deficit by increasing taxes, workers have no bargaining power over wages at the negotiation table, making matters worse for labor, according to Blackwell.

"Our government scrambles to save these banks but not to create jobs," Blackwell criticized.  "There will be 3 million people losing unemployment benefits by the end of this month."

The AFL-CIO, the largest labor federation in the nation, is currently pressing for money from the federal government to help state and local budgets, since only the federal government can run deficits.

The states and cities can help create jobs and alleviate the market, the union said.  The AFL-CIO argues that Congress should provide money to build infrastructure, and educate and train workers for jobs.  Though the stimulus package of $800 million has created or preserved 3 million jobs, it does not offset the 8.5 million unemployed workers, the union said.

"It's good, but it's not good enough," Blackwell said.  "The only question is the scale. We need much more because this is the most serious job market since the Great Depression.  The private sector is deleveraging that way.  Unless the government interferes, people will be saving more than they're spending in a flat economy."

Unions cannot solve this through collective bargaining, he said.

Stephen Lerner, of the Service Employees International Union, said that the recession resulted from deregulation, the credit crunch, the housing bubble, stagnation of wages for 30 years and, more essentially, because "working people had to borrow money against their assets" to purchase things they could not afford.

"As companies have gotten more powerful and unions have become weaker, there was a greater economic inequality in the country long before the economic crisis," Lerner said.

Small equity companies and banks were well off, while workers could not afford to buy their homes because of stagnant wages, and were forced into deeper and deeper debt, he said.

"The only way to fix that is to raise wages and allow private sector employees to join unions," Lerner continued.

"While Wall Street may be stabilizing and banks remain in profitability, the recession is actually getting worst in terms of losing homes, state budget crises and unemployment," Lerner said, adding that the solution lies in forcing banks to pay the bailout money back. The government needs to hold the banks accountable, he said.

While Wall Street is getting more money, states are letting go public sector workers, he said. 

"Much of our work is now challenging the role of banks that get money at zero percent interest rate from the Fed," Lerner said.  "Then they loan it at a higher interest rate to local governments." 

Frank Larkin, spokesperson for the International Association of Machinists, said the recession led to massive layoffs for 30,000 members in aerospace, airlines, and manufacturing.  The national union aims to protect laid off workers through secured recalls, severance pay and training opportunities. 

"The recession has provided organizing opportunities," Larkin said.  "We have been contacted by several employees facing distress and anxiety about their jobs, seeking protection from unions."

Larkin said that, since the private sector is unresponsive toward unemployment, it's the government's responsibility to act.

"Through government spending, job opportunities increase," he said, adding that the subsequent increase in federal tax revenues will help bring the deficit down.