Friday, June 14, 2013

The Powell Memo, Labor Unions and Big Business

After a surge in unionization during the Great Depression and after World War II, the peak unionization rate for workers in the U.S. was at 35 percent during the mid-1950s.

A 45-minute documentary (produced by The United Electrical, Radio and Machine Workers of America in 1946) gives us an idea of the post WWII politics that led up to the Taft-Hartley Act that restricted the ability of workers to join unions ("Call To Action" Part 1 and Part 2). Why are we still having this same discussion 67 years later?

According to data recently reported by Fox News, as of 2013 union membership has dropped to only 11.3 percent of the U.S. work force (for a total of 14.4 million union members). This is the lowest rate of unionization in the U.S. labor force in more than 70 years.

The New York Times had a similar story two years ago, and noted that union membership was roughly evenly divided between the private sector and the public sector. The median weekly earnings for union members remained higher than for those who were not in a union; but the unionization rate for American workers (along with wages and benefits) continues to decline.

According the U.S. Bureau of Labor Statistics, manufacturing in the U.S. peaked in 1979 when the U.S. had over 19.6 million manufacturing jobs --- but these jobs have been on a downward trend ever since. As of 2012, that number stood around 11.8 million --- for net difference of 7.8 million manufacturing jobs. Today the labor force participation rate is the lowest it's been since 1979.

Since 1979, the collapse of the manufacturing sector was due to globalization, which has increased unemployment dramatically. And this could go all the way back to a confidential memorandum written by a former Supreme Court Justice 8 years earlier. Later, in the 1980's, the Republican's plan of Starve the Beast began to coincide perfectly with corporate America's overall strategy.

The Powell Memorandum (aka Powell Memo or Powell Manifesto)

Hedrick Smith mentioned the Powell Memo in his book Who Stole the American Dream? The memo was written by Lewis Franklin Powell Jr almost 42 years ago -- on August 23, 1971-- less than two months before he was nominated by President Nixon to sit on U.S. Supreme Court.

The Powell Memo did not become available to the public until long after his confirmation to the Court. It was leaked to Jack Anderson, a syndicated columnist, who had stirred interest in the document when he cited it as reason to doubt Powell’s legal objectivity while sitting on the nation's highest court. Anderson cautioned that Powell “might use his position on the Supreme Court to put his ideas into practice on behalf of business interests.”

As was reported by a Virginia newspaper over a year after the memo was written ( The Free Lance-Star on September 28, 1972) Powell urged businesses to use the courts as a "social, economic and political" instruments. The memo was circulated by the U.S. Chamber of Commerce to all the top corporate executives.

Based in part on his experiences as a corporate lawyer and as a representative for the tobacco industry with the Virginia legislature, Franklin Powell wrote the Powell Memorandum to a friend at the U.S. Chamber of Commerce (Eugene B. Sydnor, Jr., the Chair of the Education Committee).

Despite what a few people still believe, the U.S. Chamber of Commerce is not a federal government agency, but since 1912, has been a business group representing the largest U.S. lobbying firms, such as the National Association of Manufacturers or NAM. (Read my post on U.S. manufacturing) Here is a list of the top 100 lobbying associations posted at the U.S. Chamber of Commerce's website.

In the fall of 1972, the venerable National Association of Manufacturers (NAM) made a surprising announcement: It planned to move its main offices from New York to Washington, D.C. --- home of the lobbyists.

The Powell Memo had called for corporate America to become more aggressive in molding politics and law in the U.S. --- and may have sparked the formation of several influential right-wing think tanks, such as the Business Roundtable, which was founded in 1972, and the Heritage Foundation, which was founded in 1973. The Powell memo had also inspired the U.S. Chamber of Commerce to become far more politically active, and are behind the free trade agreements.

In an email to me, here's what Virgil Bierschwale at Keep America at Work has to say about the Powell Memo:

From what I have learned of history so far, things like the Triangle Shirtwaist factory fire and the Vietnam war movement of the 60’s --- and everything that's happened in between --- was tilting the scales to heavily to the humanitarian side. The Powell memorandum was most likely written because of the frustration that the business community was experiencing with all of the regulations that protected people, rather than increasing their profits.

This single memorandum laid the blueprint that enabled the business community to swing the balance of the scales to the extreme side that favored profits over protecting people from the greed of the business community. And I believe it was all made possible by electing business people that wanted to run government like a business, rather than doing their part to provide the balance between the business community's need for profit, and the People’s right to a life --- one that should be better, richer and fuller for everyone --- each with an equal opportunity according to their ability or achievement, regardless of social class or circumstances of birth.

Once the business community had accomplished this, it was only a simple matter pulling the fangs of the watchdogs that would have otherwise prevented the media to be owned by six multinational corporations. After that, there was nobody to stop them, except for the people themselves, and they were divided --- because of the actions of the media, or should I say, the Tokyo Rose Globalization Propaganda Group?

The Powell Memo was titled "Attack On American Free Enterprise System" and outlined ways in which business should defend and counter-attack against a "broad attack" from "disquieting voices". But the memo was really a propaganda plan that presented a bold strategy of how corporate America could take over the key portions of the system without the other side ever knowing. And unless they have read the memo, they still don't.

Green Peace has a typescript PDF copy of the original Lewis Powell memo (with footnotes), as well as the full text of memo posted here --- or here on my blog.

There was also another Lewis Powell, but he was hanged for being a co-conspirator in the assassination of President Lincoln.

Here are two other books where the Powell Memo was also mentioned:

And here are some related articles:

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