On today’s edition of Labor 131, presented by the National Labor Office, Christopher Shaw, author and historian, joined the America's Work Force Union Podcast to discuss the historical connection between labor and banking policy. Shaw explored the role of organized labor in shaping financial regulations, the decline of workers' engagement with banking issues and the potential for renewed activism in this arena.
Shaw highlighted how workers' activism led to crucial financial reforms during the Progressive Era and New Deal. He said these reforms, including creating the Federal Reserve and the FDIC, stabilized the banking system and contributed to mid-20th-century prosperity. Shaw emphasized that regular economic panics and depressions in the 19th and early 20th centuries were largely due to an unregulated banking system, prompting workers to demand regulations that would protect their interests and stabilize the economy.
The conversation then shifted to the erosion of these reforms in recent decades. Shaw pointed to the repeal of the Glass-Steagall Act in 1999 as a pivotal moment that allowed the rise of financial conglomerates and set the stage for the 2007-2008 financial crisis. He noted that the decline in workers' engagement with banking policy, partly due to the success of earlier reforms, contributed to this deregulation trend. Shaw said the weakening of labor unions towards the end of the 20th century further diminished workers' influence on financial policy.
Despite the current challenges, Shaw expressed optimism about the potential for change. He drew parallels to the seemingly insurmountable power of Wall Street a century ago, which was eventually curbed through collective action and informed engagement. Shaw stressed the importance of workers becoming educated about banking issues and organizing to influence policy, emphasizing that "organized people can beat organized money" if they are informed and engaged.
Listen to the full episode for Shaw's in-depth analysis of labor's historical role in shaping banking policy and his vision for renewed activism.