If I told you there was a political organization dominated by white suburban men who basically control the political system of a city they don’t even live in, for the purpose of extracting monopoly profits for themselves at a cost of lower real wages for most city residents, I don’t think many of you would call that a “progressive” organization.
And yet if I told you I’m describing the political program of the building trades unions in Philadelphia, many of you would see the word “union” and automatically mentally substitute in “progressive.”
But in its current form, the building trades unions are not a progressive organization. The purpose of the organization is to use its political clout to essentially monopolize large construction projects in the city, keeping out competition from non-union shops (many of whom are perfectly well-trained and capable as Pat Gillespie reluctantly admits about a quarter of the way into this WHYY debate with Tom Ferrick), and thus extracting monopoly wages for their members – monopoly wages that they then take back to the suburbs where most of them live.
This can add up to 30% to the cost of a new housing or office project, which is then passed through as higher rents to the eventual tenant families or businesses. The higher rents lower real wages for the tenants, reducing the amount of disposable income they have left over after they’ve paid their monthly housing bill. Any way you slice it, the labor-affiliated Economic Policy Institute’s cost of living calculator says Philadelphia’s cost of living is too high for the area median income. The cost of living needs to come down, and the two biggest factors in the cost of living are housing and transportation. In some neighborhoods in Philly, combined housing and transportation costs can eat up 90% of household income.
The real progressive economic agenda for Philadelphia is A Week’s Pay for a Month’s Rent - lowering median rents to around a quarter of Philly’s area median income, and lowering the combined cost of rent and transportation to around 40% of AMI.
Currently, the building trades are pushing costs the wrong way. But that doesn’t mean they can’t be a constructive part of the solution. A few months ago at Axis Philly I outlined a political agenda on land use that would reduce rents by promoting more total housing construction, and which crucially would not require running afoul of the status quo in the construction labor market.
It’s a real problem for the trades that the public (including people like me who have a default ideological inclination to root for unions) is increasingly frustrated with high housing costs and do not see the trades as the good guys on this issue. It’s really telling that Pat Gillespie was not able to make a single persuasive argument as to how the trades’ activities help the majority of Philadelphians. Check out the interview – he doesn’t even try to make the case that their organization’s interests complement the broad public interest, and that’s why they’re losing.
What Philly actually needs is a new political coalition between the building trades, infill developers, and Smart Growth-minded environment and transportation activists whose singular goal is to maximize total building permits, primarily by slashing regulatory barriers to more total infill construction. The trades are going to have to make their peace with mixed union and non-union projects, but they were going to have to do that anyway. The benefit will be greater demand for construction work in the city, which would also mean more opportunities to grow their membership.