Trumka to Congress and Obama: We Need Jobs!
Business + Economy

Trumka to Congress and Obama: We Need Jobs!

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AFL-CIO President Richard Trumka railed against Democrats and Republicans on Wednesday for failing to create jobs, and while he was at it, took corporate leaders to task for “attacking workers’ rights to form strong unions.” His rhetoric was especially poignant given that President Obama and other Democrats have received generous campaign funds from the AFL-CIO.

“Here in Washington, we live in an Alice-in-Wonderland political climate,” Trumka said. He urged the new Congress and the president to rejigger priorities. “We have a job crisis that after three years is still raging, squeezing families, devastating our poorest communities and stunting the futures of young adults. Yet politicians of both parties tell us that we can – and should – do nothing.”

The speech signaled a growing rift between organized labor and the White House as the administration increasingly moves towards a pro-business agenda. Traditionally, labor groups have been a strong supporter of strict government regulation including occupational health, mine safety and financial regulations.

Obama’s shift to a pro-business agenda is evident in his recent appointment of several business-friendly chiefs of staff, and yesterday he wrote an op-ed piece in The Wall Street Journal, in which he ordered an overhaul of the rules executed by regulators that place “unreasonable burdens on business.”

Trumka called Obama “as pro-business as any president,” but said his decision about a review of regulators is a “distraction.”

Obama’s moves have been viewed by GOP groups as a way to repair ties with the business community. Dan Denner, CEO and president of the National Federation of Independent Business, said in a statement, “It is encouraging for the small business community to hear President Obama say that he recognizes the impact of over-burdensome regulations. It has been a long time coming for small business owners. We’ll be watching closely to see if [the] directive leads to real regulatory reform.”

As business leaders also focus on a jobs recovery, they say their biggest obstacle to job growth is regulatory activities. “We will use a range of tools, depending on the circumstances,” said U.S. Chamber CEO Thomas Donohue last week at the annual State of Business address. “Yet the time has come to also reform this regulatory process itself, to restore some badly needed balance and accountability to the system.”

Tough Words for Blankfein
Trumka’s speech came on the same day that President Obama has been meeting with Chinese President Hu Jintao and a dozen other corporate executives, including Goldman Sachs CEO Lloyd Blankfein. Trumka took direct aim at Blankfein.

“If you get a bonus when you destroyed the country, I can’t wait to see the bonuses they are going to get when the economy does start humming again,” Trumka said. “It’s that kind of hypocrisy.” He added that while most Wall Street titans enjoy record profits and continue to pay the lowest amount in taxes, they attack public employees based on the proposition that they’re overpaid. Today, Goldman Sachs released its fourth quarter earnings, which fell 53 percent due to sharp declines in its investment banking businesses. Goldman paid its employees $15.38 billion in salaries and bonuses, or 39.3 percent of its annual revenue for 2010. The amount was 5 percent lower than 2009.

Trumka’s speech comes one week before Obama’s State of the Union. He urged the president to make his address “a call to action, a call to invest in our future, to create jobs, to be the country we can and must be.” While his speech outlined the challenges the U.S. faces, he offered few solutions.

He did say, however, that the Federal Reserve should allocate a portion of its QE2 program to buy job-creating infrastructure bonds. In the long term, the Bush tax cuts should be eliminated and a 0.05 percent financial speculation tax should be imposed to raise more than $100 billion a year in revenue.

Trumka also defended the need to continue funding entitlements such as Social Security and Medicare, attacking proposals from the president’s fiscal commission, which proposed to cut $4 trillion of deficit spending. AFL-CIO leaders have been staunch supporters of more spending as a way to fuel an economic recovery.

Related Links:
AFL-CIO Head Calls out Blankfein (Politico)
Trumka to Push Obama on State of the Union Message (The Hill)
Labor Speech Previews Clash with Business in 2012 (New York Times)