The president of the largest labor union in the US suggested that a wage increase for workers worldwide is needed in order to grow the now-stagnant global economy.
“Think about this for a second,” Richard Trumka, president of the AFL-CIO, told Russia Today’s The Big Picture. “The average wage in the developing countries is right now is 50 cents a day. If we would increase that from 50 cents a day to a dollar a day, we would increase world demand by about 40 percent. That would mean that we could start growing again, creating jobs.”
“We could just do that domestically, too,” RT host Thom Hartmann quipped, “if you want to get nationalistic about it.”
“Absolutely,” replied Trumka.
Trumka said that all the nations believe that world demand for goods and services is stagnant, but growing one country’s economy more than its neighbors won’t lift the world from the current recession.
“One thing we’re trying to do is a different strategy to increase world demand rather than have everybody fight for a constant size pie,” Trumka said. “The more they try to cut back right now during this period when the recovery is so fragile, the less likely we are to grow out of it — the more likely we are to go into a recession slash depression.”
“Right now we don’t have debt crisis. We have a jobs crisis. The way to grow out of this is to create jobs worldwide,” he added.
Trumka noted that the US economy is fueled by 72 percent consumer spending, but consumers cannot spend money when they have no jobs, unless they borrow money, which is becoming harder for them to do. He said it is important for Congress to extend the unemployment benefits by year’s end, or else consumption will decrease.
“If three million people stop consuming because they don’t have money, then what you’re going to see is a real tail down, and it could really take us down into a recession which would be bad for everybody,” he said.
“If we do what the Republicans say right now — cut all spending, go back on the deficit — they’ll put us into a depression right now that we won’t get out of for a number of years,” he added.
Trumka, a member of the White House Economic Recovery Advisory Board, admitted that President Barack Obama should have spoke out for job creation “a year and a half ago.”
Tumpka spoke days prior to the Labor Department’s release of latest unemployment figures.
The Labor Department said 436,000 new jobless claims were filed in the week ending November 27, six percent higher than the prior week’s claims, which had fallen to a July 2008 low.
This video is from RT’s The Big Picture, broadcast Nov. 29, 2010.