* * *
When Lenin's Party was plotting to take over Russia, it encouraged the unions to engage in class warfare on the Party's behalf and spread the ideas of economic equality and redistribution of wealth. But as soon as the Party was in power, all such activities were discarded. In the words of prominent Party theoretician Nikolai Bukharin, "We asked for freedom of the press, thought, and civil liberties in the past because we were in the opposition and needed these liberties to conquer. Now that we have conquered, there is no longer any need for such civil liberties."
Following the October Revolution in 1917, Russia 's former Allies in WWI - France, Britain, and the US - launched a limited military intervention into Russia, seeking to restore the democratic Provisional Government and defeat the communists who had annulled Russia 's foreign debt and confiscated private property held by foreign nationals. But the Allies were defeated - not by the Red Army - but by their own labor unions, who launched a campaign of solidarity with "the first workers' state," threatening to paralyze their war-stretched economies. By 1920 the Allies withdrew without much of a fight, and the communists won.
But inside the "workers' state" itself, labor unions were reduced to the position of puppets. Any greater role would have put them in competition with the Party that claimed to speak exclusively for the "toiling masses."
It stands to reason that a state that runs a command economy would subdue the unions and make them a tool of control over the workers. That was why parading the aforementioned quote from Lenin in union offices didn't make sense to me.
The squashing of union power was gradual. For a few years after the Revolution, unions enjoyed some nominal independence. The 1922 labor code closely resembled those in Western countries, while labor productivity remained only a fraction of Western productivity. Sooner or later this contradiction had to be corrected.
The initial understanding was that, because they would be toiling conscientiously for the common good, the workers would become more productive. That never happened. When all the motivational sloganeering, appeals to the workers' conscience, and government mandates to improve productivity failed, the Soviet leaders knew they had hit a wall.
The only variable in this equation subject to the Party control were workers' rights - and they were slashed one by one without so much as a squeak from the unionists who had brought it on themselves.
By the 1930s, the unions were officially absorbed by the state, having become a subdivision of the Labor Commissariat, but without the Commissariat's authority. Most of the labor code had already been rendered obsolete. A single day's absence was punishable by dismissal and, later, by imprisonment. The state practiced compulsory assignment of graduates to workplaces. Being late for work or leaving early became an offense against the state.
Things kept getting worse, as repression proved to be the only possible way to propel the inefficient state-run economy, with fear and intimidation its only incentives.
By 1940, a worker could no longer resign from a job without the consent of the management, while the state reserved the right to transfer employees at will and without their consent. Local wage increases depended on decisions made in Moscow. The old labor code was removed from usage and no longer published.
A sad joke from that era describes the repressive political climate as follows. Three gulag prisoners are sharing stories of how they got there: "I came to work five minutes late and was accused of sabotage." "I came to work five minutes early and was accused of spying." "I came to work on time and was accused of being a Swiss secret agent." (It was only logical that its own economic inefficiency would lead to official xenophobia - a paranoid cousin of unionist protectionism.)
After Stalin's death in 1953 the terror still lingered for several years. But the reforms of the 1960s brought a new labor code that gave workers more rights than they could remember. And since the unions were now part of the totalitarian state, union membership was automatic and compulsory, with dues automatically deducted from the salary.
Despite the new labor code, the unions never regained independence. Their functions were limited to family care, recreation, and boosting workers' morale. Union functionaries busied themselves sorting out family quarrels, or putting the fear of the Party into philandering husbands and alcoholics who were absent from work for several days but couldn't be fired because unemployment wasn't supposed to exist.
Unemployment benefits didn't exist either. If you didn't have a job the state would find one for you, whether you liked it or not - including sweeping the streets. Since the government owned all industries and services, it could create any number of additional jobs, regardless of economic necessity. Resisting employment by the state was a criminal offense. A brief period without a job was tolerated, but deliberate prolonged unemployment could get one arrested, labeled a "social parasite," and sent off to a labor camp for re-education. The usual suspects were dissidents, vagrants, and dysfunctional alcoholics.
While union representatives were prone to unleash "collective indignation" on "unconscientious" workers, few took their moralizing seriously. In the absence of Stalinist terror as an absolute motivator, the "toiling masses" viewed their relationship with the state as a big joke: "they pretend they're paying us, we pretend we're working." The economy was faltering, causing an even greater scarcity of goods, irregular food supplies, and rising prices.
The only known independent workers' strike in Soviet history happened in 1962 in the Russian city of Novocherkassk. Not surprisingly, the unions played no part in. It was an unplanned, impulsive outburst caused by the announcement that the government had increased prices on basic food products. Workers at the Electric Locomotive Construction Works were the first to walk out on the job. Most of them were promptly arrested and locked up at the local police station. The next morning, thousands of men, women and children, marched in a column towards the government building to express their demands, and to free the arrested workers.
Khrushchev's relatively liberal reforms hadn't made speaking against the government any less dangerous, but the workers had become too desperate to care. The procession towards the downtown area was mostly peaceful, but random participants reportedly assaulted the Party and KGB representatives who had been trying to stop them, threatening people with retribution. At the same time the demonstrators freely fraternized with the locally stationed soldiers, posted to deny them passage across the bridge.
The frightened officials dispatched ethnically non-Russian special forces who were less likely to mix with the locals, and reinforced them with ten tanks and several armored personnel carriers. In the clash that followed, the soldiers shot at the demonstrators from automatic rifles, killing about 70 people and leaving hundreds wounded. How many were imprisoned remains unknown because the incident was hushed from the outset, and the convictions were likely to be veiled as theft, hooliganism, or banditry.
There were no strikes after that for a very long time, non-union or otherwise. Due to the government's total control of the media, no information about the strike and its suppression spilled out of the city limits, let alone into the Western press. The media first reported it during the period of Glasnost in 1989 - twenty-seven years later.
Around the same time, as the hold of the Party was already waning, Soviet coal miners went on a first-since –the-revolution nation-wide strike against the corrupt communist rule - a strike that was not suppressed by the government and widely reported in the Soviet and world media.
Again, unions played no part in it. But they picked up the initiative as soon as they realized the potential power they could wield as strike organizers. As if recovering from a decades-old amnesia, Soviet labor leaders gradually regained the skill of exploiting the workers' anger for political purposes.
After the Communist Party was disbanded in 1991 and the USSR was no more, unions continued with a series of strikes, this time directed against economic policies of new, barely hatched independent democracies. Under the guise of
caring about the workers, the hard-line communist leadership of the unions did everything in their power to add to the existing havoc, destabilize the new governments, and make the workers plead for the return of the old system.
Read all about it in the next chapter.
>
A post-USSR union poster: "Pay salaries! No layoffs!" Reminiscent of the Pravda newspaper masthead, this typeface was popular in the times of the revolution and later became a staple of the Party's visual propaganda. In the post-communist Russia, it is used subliminally to manufacture a nostalgic longing for a stern-but-fair Party leadership with a strong arm and an iron fist, reminding the workers who their "real defender" is.
CHAPTER 2
Incoming: Forced Inequality and Economic Injustice
I still lived in Ukraine when the coal miners union in the Donbass region launched a strike demanding higher wages at a time of rapid inflation. This was in the early 1990s, the first years of Ukrainian independence. The timing couldn't have been worse for the barely surviving industries that depended on coal-generated power, as the rest of the country struggled to stay warm in the winter. The miners did get their pay hike. It affected the cost of heating, power, metals, and just about everything else in the country. As the prices went up, the overall gain for the miners was zero but everyone else's lives became even more miserable.
The Donbass miners felt they were cheated and went on another strike. Well-positioned to hold the country by the throat, their union demanded one wage hike after another. The cycle repeated over and over, still leaving the miners with no gain but driving all others, especially the pensioners, into abject privation.
Before long, other unions demanded higher wages, supported by angry workers envious of the "privileged" status of the Donbass coal miners. In an overstretched economy, new pay hikes ended up driving consumer prices through the roof. The wage race was as irrational as cutting a hole in the back of a shirt to patch a tear in the front, but such is the nature of collectivist pressure groups that can't help but fulfill their purpose of extracting privileges for themselves at the expense of everyone else - even in the face of an imminent economic catastrophe.
They got their wish. Soon everyone became a millionaire, walking around with bags full of money because their pockets could no longer hold the huge wads of cash required to buy a loaf of bread, whose cost was now in the thousands. And even that money they had to spend fast; by the end of the week it was worthless. One of my friends invested part of his rapidly dwindling savings into a pearl necklace for his wife, half-joking that someday they might be lucky to trade it for a warm meal.
We all learned a new word, hyperinflation. It equalized everyone, including the Donbass coal miners.
One by one, factories started to shut down. The ones that stayed open began to pay workers with their own products. A neighbor who worked at the knitting factory brought home boxes of socks and stockings instead of money. A mother of two, she spent weeks trying to barter the socks for food and other things her family needed, which made her apartment a "sock exchange" and her a "sock broker." My other neighbor worked at a fertilizer plant; he wasn't so lucky. His plant simply closed. Barter was now the law of the land; people and businesses mostly traded in goods, often in complicated multi-party combinations. But the preferred currency was, of course, the US dollar, which was a sign of progress, given that only a few years earlier, owning "capitalist currencies" would have resulted in a visit from the KGB.
The Donbass coal miners also lost their jobs as their customers either had to shut down or pay them with socks. The little good that came out of their strikes amounted to exposing the philosophical link between trade unionism and communism, and showing why communism doesn't work. It also taught me four things everyone needs to know about inflated union wages, especially those extracted by holding a gasping nation by the throat:
1. Inflated union wages are a form of forced redistribution of wealth. They use government protection to suck other people's money in, without giving anything back.
2. Inflated union wages are futile. They lead to inflated prices; the union members do not become richer but everyone else becomes poorer.
3. Inflated union wages produce an economic monster that ravages the country and eventually consumes its own creators. In richer nations it moves slower due to the abundance of nourishment; in poorer nations it quickly destroys economies, causing massive and unwarranted suffering.
4. Inflated union wages are immoral.
* * *
I now live in the United States, where inflated union wages have already priced the American steel industry out of existence, making the Pittsburgh Steelers an anachronistic reminder of the city's industrial past. Next is the American auto industry, which has become a gigantic union-run welfare agency whose byproduct happens to be automobiles.
An article by Brent Littlefield in Pajamas Media describes the reasons: "An unbelievable $1,500 of the cost of each domestic vehicle pays for UAW (United Auto Workers) health insurance. That's more than was spent on the steel. As a result, Americans shop elsewhere: U.S. automakers produce less than 50% of the vehicles Americans now buy."
I have a friend who prices contracts for a construction company in Queens, New York. He uses a computer program that includes an option of cutting costs by decreasing the number of union workers. He applies this option when all the other factors have been computed and the bid needs to go down a notch. If that price wins him the contract, the next step is to bribe the union shop steward at the site. The "shoppie" pockets the money and turns a blind eye to the presence of a few lower-wage non-union workers.
On the construction site at Columbus Circle in Manhattan, an outside freight elevator was built to lift crews and materials. It was operated by an "elevator engineer" who pushed floor buttons at the rate of $37 per hour, competing for the title of world's most expensive bellhop. Two union goons, armed with crowbars, sat at the foot of the elevator all day in lawn chairs, sipping coffee, reading newspapers, or listening to the Howard Stern Show on the radio. Their job was to tell the crews that the elevator was unavailable - at least that's what they told my friend when he needed to lift his workers. But after his boss arrived from Queens with $500 in cash for the goons, the elevator became readily available to their crew for the duration of one week. Thus my college-educated friend learned a new rule of union mechanics: the wheels of a freight elevator needed to be greased for it to appear. This know-how wasn't taught in school, but it appears to be common knowledge on construction sites in New York.
A New York business woman once hired me to design a display booth to be shipped to a conference in Chicago. I also designed her presentations, which we finished on Saturday in her office as she simultaneously did a million other things, impressing me with her ability for multitasking. Her plan was to fly to Chicago on Sunday, set up the booth on the conference floor, hook it up, test the lighting, and show up Monday morning to reap the rewards of meticulous preparation and precise planning. But Monday morning she called me in tears to say that our booth had been vandalized. At the start of the conference she discovered that all the electrical wiring had been ripped out of the panels.
A union electrician on the floor half-admitted to his vandalism, proudly noting that this was a union site and she had no right to plug anything into the wall without hiring a union electrician and paying him the prevailing wage. He shrugged off her argument that she hadn't seen him on Sunday; he didn't work weekends. A union-compliant course of action for her would have been to arrive on a Friday. In other words, she had to waste two days of her busy schedule stranded in a strange city and pay extra hundreds of dollars in weekend hotel rates, so that a union guy could charge her $50 for inserting a plug into the wall on a Friday.
That certainly made a dent in my prior confidence in the efficiency of the American workforce.
I myself was once threatened by a union agent when I worked for a small Brooklyn-based business involved in reconstruction of New Yo
rk City public schools. The man called our office demanding $500 to cover the loss in wages for his union. It appeared that our workers had made an opening in the wall for an air duct, then patched it and cleaned up after themselves by collecting the debris into a bucket. Apparently, cleaning up after themselves was a crime; it was supposed to be a union job paid at a higher rate. Our workers broke a sacred rule: no work was allowed unless the unions could use it to squeeze the most out of the employer. I listened as he made his case, then told him to stop being ridiculous and hung up. That triggered a series of angry calls that lasted for several days.
Using expressions that I, a recent immigrant, hadn't yet heard before, the man told me not to mess with the unions and that I didn't know what I was getting into by taking it lightly. I answered that on the contrary, I realized that anyone charging $500 for a bucket of trash had to be a very important man. But I didn't understand why, instead of spending more time carrying buckets, he wasted his valuable minutes on the phone trashing me - a man so unimportant that he took out his own trash free of charge. Every three minutes of the conversation I kept reminding him that he had just lost another $500 in potential wages simply by talking to me. I must have convinced him because the calls eventually stopped.
It was true that I didn't know what I might be getting into. It was later explained to me by an older friend, who was active in the unions back in the 1970s. He recalled how some of the business agents (union organizers) carried guns while visiting private contractors. "They wore suits and during negotiations would occasionally let their jackets open, just enough for a glimpse of the hardware they were carrying. I didn't know of any actual murders, but I knew that uncooperative non-union contractors had their tires flattened, trucks vandalized, and storage buildings set on fire."
Shakedown Socialism Page 2