Schadenfreude. That was my reaction to a recent piece by Rick Moran:
A week ago, employees at the Gothamist and DNAinfo were celebrating after a successful vote to join the Writers Guild. The Gothamist is a noted New York City website that is devoted to covering local news. They operate affiliated sites in Washington, D.C., Chicago, Los Angeles and San Francisco.
But the reporters’ celebration was shortlived. Yesterday, the publisher of the Gothamist and its parent website, DNAifno, informed all employees that he was shutting them down.
Joe Ricketts, who founded Ameritrade, made the announcement in an email….
The question isn’t whether Ricketts was justified in pulling the plug. The question is why employees thought the outcome would be any different?
Many unions in 21st century America offer a fantasy. Simple arithmetic would show even the dumbest worker that the dream doesn’t add up and that reality wins in the end. The best example of that is the drive for a $15 an hour minimum wage. When you disconnect the cost of labor from the value of labor, the numbers don’t add up and companies end up losing money or, at best, dramatically reducing profits. In the real world, radically increasing the cost of labor means increasing the price of the products sold. In the case of fast food restaurants, that means a reduction in traffic leading to fewer customers and less profit.
But organized labor has sold the idea that there are no consequences to raising the minimum wage to $15 an hour. We are already seeing franchises moving rapidly to automate their operations as much as possible and reduce the number of employees — leading to job losses and, just as importantly, fewer jobs created.
The Gothamist employees are shocked, shocked I say, to find out that a news website doesn’t make money and even a billionaire can tolerate losing only so much money before throwing in the towel. Unionizing also brings other headaches that are intolerable to management unless they are gluttons for punishment.
The writing was on the wall for these employees, but they were blinded by their own delusions and naivete. [“Publisher Shutters Websites after Journalists Unionize“, American Thinker, November 3, 2017]
Schadenfreude because I have been anti-union for 60 years.
It began while I was in high school. I had a part-time job bagging groceries at a supermarket. The supermarket was unionized, as was the norm in my home State of Michigan. My wage rate was set by a contract between the supermarket chain and the union, which I had to join as a condition of employment.
After I had been on the job for several months, the manager of the supermarket added shelf-stocking to my duties. According to the union contract, I should have received a raise for doing something other than bagging groceries, which was the lowest-paid job in the store. I complained to the manager about my wage rate. He fired me. The head of the local union couldn’t be bothered to defend me because he knew that I was going off to college in the fall. And so I received no benefit for paying union dues out my measly earnings.
Did I owe those measly earnings to the unionization of the store? I doubt it. I was a fast and effective bagger, unlike the baggers who work where my wife does most of her grocery shopping. I filled a grocery bag so that it wasn’t too heavy or too light; I put the heavy items on the bottom and the crushable items on top; I separated produce and frozen foods from soap and other scented items; etc. Given my superior skill as a bagger, the effect of the union contract was to penalize me and transfer some of my earnings to the less efficient baggers who worked with me.
That’s a good enough reason to be anti-union. But there are other reasons, having to do with freedom of association and freedom of contract.
I have nothing against the formation of a union, in principle. The formation of a union as a voluntary organization is an exercise of the unenumerated right of freedom of association, which is contemplated in the Ninth Amendment to the Constitution of the United States. By the same token, when labor laws force a person to join union, that person’s constitutional right to freedom of association is violated.
Moreover, such laws violate the freedom of contract guaranteed in Article I, Section 10, of the Constitution of the United States. The violation impinges on the right of the individual worker to negotiate with an employer. By the same token, the violation impinges on the right of the employer to negotiate with each of his employees, taking into account their particular skills and performance.
Further, forced unionization impinges on the employer’s unenumerated constitutional right to the lawful use of his business property.
There is also the effect of unionization on employment. If the contracted wage rate is set below the wage rate that would obtain in the absence of unionization, workers (or many of them) are underpaid. In the more typical case, where a union strives to set a wage rate higher than the market-clearing rate, employers hire fewer workers than they would absent unionization. (There’s an obvious parallel with the minimum wage.)
I am always gladdened when I read that labor-union membership in the United States has declined, not just as a percentage of the labor force, but in absolute numbers. Personal responsibility isn’t dead in the United States, despite the efforts of most of the nation’s politicians an bureaucrats.
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The Interest-Group Paradox
Law and Liberty
Government Failure: An Example
The Left and Its Delusions
Corporations, Unions, and the State
Judicial Supremacy: Judicial Tyranny
Substantive Due Process, Liberty of Contract, and States’ “Police Power”
Why Liberty of Contract Matters
Society, Polarization, and Dissent