Ch. 22 Section 2

1. Ch. 22Section 2 Labor Unions

2. In a complete sentence, write a statement describing each of the following (Do not just copy the definition!)– • Labor Unions • Trade Unions • Industrial Unions • Right to work law • Closed shop • Union shop • Strikes • Injunction • National Labor Relations Board • Mediation • Arbitration • boycott

3. Organized Labor • Labor Unions are groups of workers who band together to have a better chance to obtain higher pay, benefits and better working conditions • Out of the 151 million in the civilian labor force, only 14% of American workers belong to a union. • That number has been falling since the 1980’s as we have transformed our economy from manufacturing to a service based economy.

4. Development 1800s Poor working conditions Workers fired for no reason Workers blacklisted Knights of Labor 1st major union founded in 1869 Organized all laborers - men, women, African-Americans Terrence V. Powderly 1886 peak of membership at 700,000 Ended in 1900 The First Unions

5. American Federation of Labor (AFL) • Organized in 1886 • Denied unskilled workers, women, African Americans & immigrants • Samuel Gompers • Fought for higher wages, shorter hours & benefits for disabled • By 1900 membership reached 500,000 Samuel Gompers

6. Organized Labor (cont.) • There are two types of unions: • Trade unions– workers who perform the same skills • Industrial unions– bring workers together who belong to the same industry • Organized labor has a three level hierarchy: • local unions • national unions • federations

7. Union Guessing Game Amer. Federation of Federal Employees Amer. Federation of Teachers United American Nurses American Postal Workers Union Airline Pilots Assoc.

8. Organized Labor (cont.) • Local unions are made up of workers in a factory, company or geographic area. • Usually identified with #s • Negotiates a contract with a company and monitors the contract terms • Represents the National unions agenda, while at the same time representing the desires of their constituents

9. Organized Labor (cont.) • National unions are the individual craft or industrial unions that represent local unions nationwide • Help employees set up local unions and negotiate contracts • In certain industries, the national union negotiates the contracts for the entire industry

10. Organized Labor (cont.) • At the Federation level is the AFL-CIO • Represents 13 million workers nationwide • From 1955-2005, represented virtually all unionized workers in the U.S.

11. Union Membership Policies • Closed Shop – Companies hire only union members • Union Shop – Workers must join the union after a specified time • Agency Shop – Not required to join a union, but must pay dues • Open Shop – Companies may hire workers regardless of membership • Modified Union Shop – Workers given an option to join a union after hiring

12. Organized Labor • In the past, some labor unions supported closed shops, when a worker would have to first belong to a union to be hired by a company. • This was banned by the Taft-Hartley Act 1947 • Stopped the practice • of closed shops

13. Organized Labor • A common arrangement today is the union shop, which allows companies to hire anyone as long as they join the union shortly after they begin working • One part of the Taft-Hartley Act banned this practice as well. • 22 states have passed right-to-work laws, which prevent mandatory union membership required by union shops

14. Organized Labor • What we see in the South are modified union shops, in which workers do not have to join a union, but if they do join have to remain a member for the duration of their employment. • A majority of workers must vote in favor of a union before one can be formed. • The National Labor Relations Board makes sure union votes are carried out honestly

15. Collective Bargaining • Process where union leaders & employers discuss employment terms • Once workers choose to be represented by a union, the union is responsible for carrying out collective bargaining. • Union and company representatives meet to discuss conditions of employment such as: • Wages • Work hours • Working conditions • Grievance procedures • Benefits • Work rules and responsibilities

16. Compromise is the issue • 3 steps • Negotiation – Labor & management meet to discuss contract issues • Mediation – A neutral 3rd party hears both sides • Federal Mediation & Conciliation Service provides a mediator • Arbitration – 3rd party makes a final decision for a compromise. Has the power of a judge and both sides agree to accept the arbitrators decision.

17. Many African countries have: • Traditional Economies • Command Economies • Market Economies • Laser Taser Watches

18. When Collective Bargaining Fails • Worker/Union • Strikes – workers refuse to work • Picketing – used to discourage other workers from working • Boycott – Refuse to purchase goods or services from the company • Scab – Worker willing to work on company terms

19. Labor-Management Conflict (cont.) • Business/Management • Lockout - in which the company blocks workers from entering the workplace until they accept their contract terms. • Blacklist– A list of people who are denied employment • Businesses hope the loss in income will convince workers to accept the companies position. • Can ask the courts to issue an injunction, a legal order from the court preventing some activity (strike) Ex. 1995 MLB season

20. Labor-Management Conflict (cont.) • In severe or extreme labor-management dispute, government may get involved. • Can seize operations of an industry until conflict is settled. Ex. 1946 U.S. seized the coal industry because of the countries need for this energy source. Operation of the mines continued, until labor and management came to an amicable agreement

21. Strike Picketing Scabs/Strikebreakers Violence

22. Major Events in Union History • 1869 – Knights of Labor founded • 1882 – First Labor Day parade • 1886 – AFL founded • 1892 – Homestead Strike • 1911 – Triangle Shirtwaist factory fire • 1912 – Bread and Roses strike; Dept. Labor founded • 1914 – Ludlow Massacre • 1920 – Women get right to vote in US • 1946 – Largest strike wave in US history • 1947 – Taft-Hartley Act • 1955 – AFL and CIO merge • 1970 – Occupational Safety and Health Act passed (OSHA) • 1981 – President Reagan breaks air traffic controllers strike • 2013 – Union membership hits 97 year low (14.3 million union members, 11.3% of population)

23. If an item has competing brands it is defined as: • Complimentary • Mr. Freeze • Inelastic • Elastic

24. Right to Work States Prevents unions from forcing workers to join Movement of Human Capital Rust belt – the North Sun belt – the South Factories & businesses moved from the rustbelt to the sunbelt Weather was better Cheaper labor No existing unions White collar vs. Blue collar jobs White Collar = upper management Lot of news on white collar crime in big business. Example: Enron, Merrill Lynch Blue Collar = working class, usually doing manual labor Unions Today

25. Right to Work States in Blue Blue Collar Workers

26. Right to Work States – Why it matters?

27. What are the type of jobs that usually occur in manufacturing sectors called? • Rust Belt • Sun Belt • White Collar • Blue Collar

28. Money, Banking,Credit & Consumer Rights Ch. 20

29. Replaced the barter system in traditional economies Functions Medium of Exchange Used to trade/purchase goods/services Store of Value Ability to storeor save Medium/Measure of Value Can be divisible Each one must be equal to the other Not easy to counterfeit Standard of Deferred Payment Used to buy on credit Money

30. Joyce wants to buy a new coffee mug for $5, but decides to wait until payday. Ben bought 2 tickets for a movie Melissa promised to repay next month a loan Emily gave her Ken was trying to decide whether to buy 3 candy bars for $.50 each or 1 chocolate Sunday for $1.65 Joanne purchased a new hat as a present for her sister Tyrone puts $20 into his savings account. He hopes to save enough money to buy a new dirt bike. Henry has to pay the bank $187.50 a month for the next 4 years on his new car loan. Kim decided to take the $.75 bus ride rather than an $8 cab ride. The manager of Apex Stores gave Maria her paycheck George always likes to keep a $20 bill stashed away in his wallet for emergencies.

31. Different types of Money

32. What is it called when you get less satisfaction from eating your 2nd piece of pizza? • Law of Diminishing Returns • Anti-Pizza disease • Full Stomach syndrome • Diminishing Marginal Utility

33. What is not a factor of production? • Unions • Labor • Natural Resources • Capital

34. What type of economy is the U.S.? • Traditional • Market • Mixed • Command

35. Brings savers (sellers) & borrowers (buyers) together in the market Savers = deposits Borrowers = loans Banks are a business and have profit motive Make money off of fees and interest on loans Reserve Requirements – banks want more deposits so they can loan more money Banking

36. What signaled the start of the Great Depression? • Roosevelt’s Fireside Chats • Bank Holiday • Stock Market Crash • Hoovervilles

37. What Banking Act created a national currency backed by U.S. government bonds? • 1. The Federal Reserve Act of 1913 • 2. National Banking Act of 1863 • 3. The Gramm-Leach-Bliley Act

38. Types of Deposit Accounts • Checking Account • Allows customers to write checks, use debit cards or withdraw money from an ATM (Automated Teller Machine) • Money transactions are quick and efficient • Money does not stay in the account for long • Depositor usually receives no interest • Checking/Debit Cards • Transfer of funds electronically • Tied directly to checking accounts

39. Checking Accounts

41. Types of Deposit Accounts cont. 2.Savings Account • Banks pay interestto customers based on how much money is deposited • Money remains untouched for longer periods of time

42. Savings Account Sample Bank Book

43. Types of Deposit Accounts cont. 3.Certificate of Deposit (CDs) • Customers loan a certain amount to the bank for a certain amount of time • Ex. I bought a $1,000 CD for 1 year at 4% • Higher rates of interest than savings • Customers can’t withdraw their money without a penalty

44. Types of Banks • Commercial Banks – full service to individuals & businesses (Most common) • Savings & Loan Associations – traditionally loaned money to people buying homes & issued only savings accounts • Credit Unions – non-profit – sponsored by large businesses, labor unions or government institutions – offer full services at usually lower prices

45. Commercial Banks

46. Credit Unions

47. FDIC • Federal Deposit Insurance Corporation • Insures deposited money in the bank up to $250,000 • Most banks are FDIC insured

48. What US event caused the formation of the FDIC? • 9/11 • Bombing of Pearl Harbor • The stock market crash and bank runs during the Great Depression

49. Loans • Agreement for borrowing money with repayment plus interest • Used to make expensive purchases • Banks make money on the interest paid for a loan • In order to make loans, banks have to have money • To have the money, banks must attract deposit customers • Can increase the supply of money • Principle – amount borrowed • Interest – cost of borrowing • Interest Rate – rate of cost to borrow

50. Types of Loans • Fixed – interest is set & can’t be changed • Variable – Changes when interest rates change