The New Republic

Jonathan Cohn, "Auto Destruct", The New Republic, 12.31.2008, 15-16.

Even though constantly rising wages helped create what's known as a wage-price spiral, or repeating cycle of inflation, the net effect still seemed to be positive. Between the 1940s and '70s, real wages - that is, wages adjusted for inflation - for the typical American worker doubled. As Paul Krugman, the Nobel Prize-winning economist, concluded, 'everything we know about unions says that their new power was a major factor in the creation of a middle-class society.
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There's a broad consensus that, over the last 30 years, real wages for the typical American worker have stagnated - in contrast to the 30 years before that, when unions thrived and real wages doubled. As an exercise, I asked Dean Baker, from the Center for Economic Policy Research, to calculate informally where wages for the typical working-age American would be if they'd continued to rise as they had done before the 1970s, while the unions were strong and helping to raise living standards for everybody. He determined that somebody between 45 and 55 years old, roughly the average UAW age today, would be making about $25 per hour - which is very close to the $28 per hour the typical UAW member makes.
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Health benefits, and retiree health benefits in particular, became the most glaring problem, since foreign competitors didn't have similar burdens. Workers in the factories these companies maintained abroad benefited from national health insurance programs. Workers in the plants these companies established here didn't have that advantage.
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But, if the 2007 UAW agreement represented a lifeline for the industry as a whole, it also represented a death knell for the old way of doing things. No longer would the auto industry guarantee its factory workers a middle-class way of life, because it simply wasn't possible for a company to accomplish that on its own. The global economy had rendered the Treaty of Detroit null and void - and pushed the ambitions of Flint's sit-downers farther out of reach.