Labor Unions
By David M. Woods
Published September 26, 2006, 2:08 pm in Economic Issues.
We don't think about labor unions very much anymore. Even when Labor Day rolls around on that first Monday in September, we'd probably forget why this was a holiday, if not for an occasional mention of it in the newspaper or on the radio.
According to the Bureau of labor statistics, only about 12 1/2 percent of workers belonged to labor unions in 2005. The most unionized industry in America is government employees, where about 37% belong to unions.
So the question must be asked: In today's economy, are labor unions necessary to protect workers' rights, or are they an antiquated anachronism that should be dismantled?
What are our Rights?
To answer that question, it must first be stated that workers do indeed have a right to form unions and negotiate for better wages and conditions. But by that same token, workers also have a right to NOT join a union, if that is their choice.
Employers, likewise, should have the same choices. Employers have a right to hire union workers and negotiate with unions, if they so choose. And employers have the right to NOT hire union workers if they so choose.
The common theme in the above statements, of course, is choice. The United States is supposed to be a free country, which means people are supposed to have the freedom to run their own lives and manage their own affairs without government interference, so long as their actions are peaceful and honest.
But when it comes to the private relationship between an employer and employee, this lofty ideal goes out the window. In all fairness, government has meddled on both sides of the labor equation. There is a set of laws which give unions and workers an unfair edge, but there are also laws that give employers unfair advantages, also.
In the category of laws skewered toward workers, here is a partial list: the Railway Act of 1926, the Davis-Bacon Act of 1931, the Norris-LaGuardia Act of 1932, the National Labor Relations Act of 1935, the Walsh-Healy Act of 1936, the Fair Labor Standards Act of 1938, and others. The common theme among all of them is a mandate that employers must bargain with unions, regardless of whether the employer chooses to.
In the other category are many government actions that directly benefit businesses and harm workers. This includes corporate subsidies, protectionist legislation and tariffs, and countless local and state codes, licenses, and exemptions such as "grandfather clauses" which shield businesses from competition. These types of government interventions may benefit one company or one industry, but in the long run they inhibit and distort economic growth, which ultimately lowers the demand for labor. Whether or not any business fails or succeeds should depend on how well that business satisfies its customers and holds down costs, NOT its degree of political clout.
So when the government intervenes in private affairs, how exactly does it impose its will? It does it because government, and only government, has a legal monopoly on force.
Force & Coercion
All government laws and actions are backed up by the power to use physical force to punish anyone who does not obey them. This punishment can take the form of fines, imprisonment, or worse. Therefore, if the only way that unions can make reluctant employers bargain with them is to have the government threaten them with force, this basically means that labor unions, at their very core, rely on coercion for their very existence.
Using the government thusly as the middle-man to do the coercive dirty work gives the unions an air of legitimacy and respectability. Of course, sometimes labor unions do this dirty work themselves. The history of labor unions in the U.S. is a history of violence. It is a generally accepted fact that if a union calls a strike, and a "scab" (a person who chooses not to associate with the union) attempts to go in and work for the employer, that the "scab" will most likely become a victim of violence.
So when it comes right down to it, all union power ultimately comes from force and coercion. If labor unions could find a way to peacefully, voluntarily convince employers and non-union members to participate, neither via "legal" government coercion, nor via illegal coercion at the end of a baseball bat, then no one could object to their existence. But it appears that unions have not figured out a way to do this.
The Relevance of Unions
Without question, wages, salaries, benefits, and working conditions have vastly increased in the last 100 years. But how much of this increase was due to the work of labor unions, as opposed to just general economic growth?
The U.S. economy has certainly grown. In 1900, the "real" (adjusted for inflation) GDP was $376 billion (in 2000 dollars), with a per-capita rate of under $5000.
In 1950, real GDP was just under $2 trillion, with a per-capita rate of about $12,000.
In 1980, real GDP was over $5 trillion, with a per-capita of about $23,000.
2005 comes in at $11 1/2 trillion, per-capita of about $37,000.
As mentioned earlier, labor union membership in 2005 was only about 12 1/2 percent. Consider the data and draw your own conclusions, dear reader.
But to determine the relevancy of unions, it is interesting to note the types of careers and industries that tend to be unionized. The industry I work in, Information Technology, has never been unionized, and probably never will. The same applies to accountants, bookkeepers, administrative assistants, and other typical "office" workers.
At the other extreme, you have government employees. As mentioned earlier, they are the most heavily unionized industry in the U.S. Another career fields that is heavily unionized is the entertainment field, including actors and musicians. Why would actors and musicians feel they must unionize? Do they not enjoy their work? Not having ever worked full-time as a professional actor or musician, I can't say with absolute authority, but it would seem to be a very fun, exciting, thrilling job. At least, it would have to be more fun than working in Information Technology, which can be strenuous, stressful, and mundane.
The only logical explanations are that actors and musicians tend to be politically liberal, and liberals always feel they are a victim of "corporate greed." The relevance of labor unions, it seems, depends on your political philosophy.
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