labor unions

Union Thuggery…

…of which there has been so much in recent months, seems to be spreading.

The development comes as no surprise to this unprivileged native of Michigan, where unions have long held disproportionate power, due (in part) to their ability to inflict financial and physical harm. I was a “beneficiary” of that power in the 1950s when, as a 16- and 17-year old, I was required to join the Retail Clerks International Union so that I could bag groceries after school and on weekends for the munificent wage of about 90 cents an hour. I went to one union meeting, out of curiosity, and even my 16- or 17-year old self was amused by the sight of grown men calling each other “brother,” like members of the Mystic Knights of the Sea Lodge. Most of those present at the meeting were employees of low-grade, low-margin grocery chains, whose mostly working-class customers they sought to gouge for higher wages. (Of course, the union members didn’t think of it in that way.) The chorus of “brotherhood” was led by a handful of full-time union officials (including a decidedly shifty character), whose customer-financed salaries undoubtedly exceeded the earnings of the workers whom they purported to represent.

Henry Ford was a man of many parts, not all of them praiseworthy, but he was right about labor unions:

Ford was adamantly against labor unions. He explained his views on unions in Chapter 18 of My Life and Work.[33] He thought they were too heavily influenced by some leaders who, despite their ostensible good motives, would end up doing more harm than good for workers. Most wanted to restrict productivity as a means to foster employment, but Ford saw this as self-defeating because, in his view, productivity was necessary for any economic prosperity to exist.

He believed that productivity gains that obviated certain jobs would nevertheless stimulate the larger economy and thus grow new jobs elsewhere, whether within the same corporation or in others. Ford also believed that union leaders (particularly Leninist-leaning ones) had a perverse incentive to foment perpetual socio-economic crisis as a way to maintain their own power. Meanwhile, he believed that smart managers had an incentive to do right by their workers, because doing so would maximize their own profits. (Ford did acknowledge, however, that many managers were basically too bad at managing to understand this fact.) But Ford believed that eventually, if good managers such as he could fend off the attacks of misguided people from both left and right (i.e., both socialists and bad-manager reactionaries), the good managers would create a socio-economic system wherein neither bad management nor bad unions could find enough support to continue existing.

Given that the Wagner Act was an unconstitutional usurpation of property rights, I cannot entirely condemn Ford’s bare-knuckles method of dealing with union organizers, who were bare-knuckles men themselves.

And then there were Jimmy Hoffa and his namesake son, to name but a few “icons” of the “peaceful” labor movement and its habit of wrenching above-market wages and lucrative pensions from the honest workers of America.

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Related posts: here and here.

Corporations, Unions, and the State

When left-libertarians discuss right-to-work laws they claim to discern a pro-employer — specifically, pro-corporation — tilt on the part of government. I will not play the futile and foolish game of trying to disentangle the effects of decades’ worth of pro/anti/corporation/union enactments. My modest objective is to ask whether the corporation or the union (or both or neither) is inherently antilibertarian.

The question that libertarians (and pseudo-libertarians) ought to address are these:

  • Does corporate status per se enable an employer to coerce employees or prospective employees?
  • Does state-enforced recognition of labor unions by employers amount to coercion?

The obvious answer to the second question is “yes.” Apologists for labor unions will nevertheless assert that coercion by the state, which enables coercion by labor unions, is necessary to offset an “unnatural” advantage that accrues to an employer if the employer is a corporation?

What is that “unnatural” advantage? What power is bestowed by corporate status that is lacking in a sole proprietorship, partnership, or other non-corporate form of organization? It is said that corporate status involves two unique characteristics: perpetual existence and limited liability.  Non-corporate organizations can enjoy the former easily enough, through bequests, property transfers, agreements that allow for the admission of new and/or replacement partners, and so on. These are simply contractual arrangements that do not require the state’s existence, except as a neutral enforcer of voluntary, non-fraudulent contracts between compos mentis adults. In sum, perpetual existence does not confer upon the corporation an “unnatural” advantage when it comes to dealing with employees and prospective employees.

What about limited liability? The key artificiality of limited liability is that it shifts the responsibility for debts from the directors, officers, and owners of the corporation to the corporation itself. But I fail to see how that artificiality plays into dealings with employees and prospective employees. In fact, the artificiality lends stability to the corporation, which is advantageous to employees and attractive to prospective employees.

Nor is it clear to me that the corporation could not exist in the absence of statutory approval. The corporation is usually considered a creature of the state — as if it could not exist absent statutory authority — simply because the earliest corporations were creatures  of the state and often were instruments of state power. But there are other beneficial and “artificial” commercial arrangements (e.g., banking and credit) that began and thrived before the state injected itself into such arrangements. The advantages of corporate status — as a way of fostering commercial expansion — would, I think, be recognized in a common-law regime.

The bottom line on the corporation: It would exist in the absence of the state (or recognition by the state), and its essential features do not give it an “unnatural” advantage in dealings with employees and prospective employees.

I cannot say the same for the labor union, which exists by and for coercion. A union can exist without coercion, in certain limited circumstances, for example, an unskilled, fungible labor force whose members lack the means to uproot themselves from a relatively isolated location. (Think “Welsh coal miners,” for instance.)

But where there is a diverse labor force and diverse employment opportunities, it is not in the interest of the more skilled (or independent-minded) workers to cast their lot with their less-skilled brethren. Their interest is served by the ability to bargain for the best available combination of compensation and working conditions. The submission of highly skilled workers to unionization comes about mainly because (a) they have no legal option (in jurisdictions that back the union shop) and/or (b) “scabs” face threats ranging from harassment to ostracism to violence, directed not only at “scabs” but also at their families.

Employers, for the most part, view unionization as coercion. Yes, there is the occasional business that chooses to recognize a union, even if the business is not compelled to do so by statute. But recognition, in such cases, is the the free choice of the businesses in question. Most other businesses make the opposite choice, where they are allowed to do so. Nothing more need be said on that point.

In summary: The corporation is not a coercive institution; the labor union is. Right-to-work laws are justified on libertarian grounds because they eliminate the coercion of workers and employers.

Related posts:
A Belated Labor Day Message
Union-Busting

Union-Busting

Some not-so-random thoughts about unions.

Allowing public-sector unions is like allowing thieves to enter your home, knowing that they intend to rob you.

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Hell hath no fury like a labor union scorned — or like a consumer or taxpayer who has had enough! Public- and private-sector unions, beware. Your days of wage-and-benefit-gouging — enabled by your pet legislators, governors, and presidents — are coming to an end. Let the downfall of Detroit and Michigan be a lesson to you. Accept what customers and taxpayers are willing to pay for your products and services, or do without a job. The choice is yours.

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Pro-union rallies are a heaven-sent opportunity for the GOP to stand up to mobs demanding tribute from taxpayers. The GOP has little to lose by standing up to unions, and much to gain. Most union members — public and private — vote Democrat, anyway. And a relatively small fraction of Americans owe allegiance to unions, which in the private sector have been losing members, and clout, for decades. A strong anti-union stand will put the GOP in good stead with over-taxed, non-union, independent voters. So, here’s my advice to the GOP: Hold your ground and you will garner support that will enable you hold the House, retake the Senate, and retake the White House in 2012. You can then repeal Obamacare; roll back Social Security, Medicare, and Medicaid to true “safety net” status; whip the regulatory agencies into submission; and kill unionism with a national right-to-work law based on liberty of contract, as guaranteed by the Constitution.

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Legalized extortionists Union leaders foresee a backlash against the GOP for the courageous actions of Wisconsin’s Republican lawmakers. I foresee a “frontlash,” as beleaguered taxpayers in other States demand the same degree of courage from their legislatures.

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The American Revolution-in-progress is a movement by and on behalf of oppressed taxpayers. It is opposed by big-government’s wards and apologists — the welfare class, unionists, government employees, crony capitalists, and emotional, fact-challenged leftists.

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If I were a taxpayer in a State with strong public-sector unions, I’d feel like a condemned man who was forced to pay for his own execution.

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Civil servants and union members are drones to politicians, senior bureaucrats, public-school administrators, and union bosses — the “queen bees” whose luxurious salaries and perks the drones make possible simply by virtue of their existence. Private-sector “drones” have the satisfaction of producing real goods and services, and the “queen bees” (for the most part) deserve what they earn because of their managerial and financial contributions to the output of real goods and services.

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The First Amendment reads:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

Upon removing the superfluous 18th-century comma from the final clause, the Amendment’s correct meaning becomes evident:

Congress (and through incorporation, the States and their political subdivisions), shall make no law restricting the right of the people to assemble peaceably for the purpose of addressing government.

In sum, peaceable assembly may be restricted when it is for a purpose other than to address government. Protests and picket lines that deprive private persons and businesses of peaceful enjoyment and the lawful conduct of their affairs are affronts to the Fourteenth Amendment‘s guarantees of due process and equal protection. Further, disruptive actions, such as the ones earlier this year in Madison, are not peaceable and should not be tolerated.

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From the Austin American-Statesman:

Significant changes to pay and benefits for Texas’ employees, if enacted by legislators, could drive thousands of workers into retirement or jobs outside state government, survey results released Monday show.

About 20,500 state workers — or 14 percent of the workforce outside higher education — responded to the online survey, conducted by the Texas Public Employees Association.

About 57 percent of the respondents eligible for retirement said they would jump ship in the wake of pay cuts, increases in health insurance costs and other benefit changes now under consideration by lawmakers.

Among those respondents not of retirement age, nearly one-third said they would look for work outside of state government. Another 28 percent would wait until the economy improves and then bolt.

Four comments:

1. There’s usually a big gap between survey responses and actual behavior. It’s easy to give a “brave” response, but when the chips are down…

2. Good luck finding a private-sector job that will compensate you as well as your public-sector job.

3. If you do bail for the private sector, thank you. That’s one less “public servant” I have to support.

4. If a “public servant” finds the foregoing comments “hateful,” that’s too bad. I have to support you; I don’t have to love you.

A Belated Labor Day Message

The good news:


Derived from “Union Membership, Coverage, Density, and Employment Among Private Sector Workers, 1973-2010,” © 2010 by Barry T. Hirsch and David A. Macpherson.

Why is this good news? Read on: “The Truth about Labor Day,” from the Ludwig von Mises Institute; “Toward a Capital Theory of Value,” “A Very Politically Incorrect Labor Day Post,” and “Your Labor Day Reading,” by me. (NB: Some of the links in these old posts may be broken, and some of the quoted Wikipedia articles may have been revised by “contributors” eager to whitewash the labor-union movement.)