Armchair labor theory
It is a well known and documented fact that the percentage of the US workforce that are members of unions is going down. The recent split of the SEIU et. al. from the AFL/CIO has been cited as either a sign of the downfall, or a glimmer of hope, depending on who is doing the looking. The relevancy of Unions has been questioned for some time now, thanks to these statistics.
In the beginning Unions were formed as a way to check the power of business owners in a way the government was unwilling to do. The creation of them was not exactly easy, and faced hostile and violent opposition from business owners. In the end, the right to form Unions was recognized by the government and the right to organize was enshrined in federal law. Since those times, the government has become more protective of worker's rights than they were in the bad old days (minimum wage, child labor laws, overtime provisions, etc), so what Unions provide is not as clear as it used to be.
These days Unions are fighting tooth and nail for benefits that aren't enshrined in law, such as health care and vacation days. There have been many strikes over the past three years over the rise in health-care premiums and employers seeking concessions from Unions to pay a greater percentage of the cost. In point of fact, the cost-of-living increases many union workers get are erased and more by the rise in the health-care premium.
Then take the case of the Northwest Airlines (NWA) Mechanics. They've been on strike for over a week now, but NWA's flying schedule has not been impacted all that much. That's not how it is supposed to go with these sorts of things. Since NWA is using non-union workers to fill in the gap left behind, the FAA has increased safety inspections of NWA planes. Complicating matters is that the Airline industry has been in a bit of a contraction phase since the 9/11 attacks, so there are a lot of trained ex-airplane mechanics out there to draw on. Trained ex-mechanics who have no qualms about crossing a picket line for good money.
Big Business views Unions as a drain on the economy. They increase the costs-per-worker beyond what the free market would dictate. They introduce an inflexible element into the business plan that can be impossible to work around without conflict. These are the reasons that WalMart has closed every store that voted to organize, since Unions do impact the bottom line.
As the NWA mechanics are finding out, Unions survive longest when the business has no alternative to dealing with them. Create an environment with a lot of non-union workers out there, and the Union will be worked around. This sort of thing has happened all over the US in the wake of globalization, as the 'market' for labor has expanded greatly to include whole countries without Union movements.
Unions work best when entire market sectors are organized. The United Auto Workers were in such a place until the Japanese car makers started building car factories in the US that the UAW couldn't organize. The 'government worker' is another area where this is the case, though that too is eroding. If the entire sector is organized, free-market forces affect things like benefits and pay rates. If it isn't organized, the unionized shops (which have higher costs) have to compete against the lower-cost non-union shops. The American consumer has been proven to not care a whit about the welfare of the worker that made their $9 T-Shirt from Target, so that kind of market force won't work.
So what are we to do?
The European model is criticized by many economists for being too socialist and inflexible when it comes to responding to market forces. Germany, a haven for Unions, has been in recession for a very long time due to its inability to attract new and vibrant business. The taxes that places like Norway impose on their people would cause the average American to go into cardiac arrest. How to pay for the pensions of the now-retiring baby boom generation is threatening to break the central banks of many European nations, well before our own Social Security will go bust. While it may be comfortable to be a worker there right now, there is a reason why residents are getting up in arms over immigration, and the cheaper labor that brings.
The economy is a global thing. Widget-makers have been moving off our shores for decades now. The service economy is now following suit in the segments where telepresence (phone, e-mail ,whatnot) can be done. While the worker who weighs your bags at the airport is probably not a full time resident of India, the person who took your reservation in the first place (or the geeks who maintain the server-farm running the e-commerce application that took your order) almost definitely was. The average US worker is competing for work directly with workers in India and China, and these are countries without much collectiveist background at the grass-roots.
It is because the US worker is competing directly with foreigners for work that you get protectionist urgings from the labor camp. That'll never fly. The free market is here and established enough that these sorts of trade barriers can't stand for long. Tariffs are used to raise the US-price of goods imported from low-wage or lower-cost nations enough that the US-made goods are a hair cheaper. We had a bit of a trade war going on over steel a while back due to just this reflex.
So the US labor movement needs to adopt some new methods. This is why I see that the defection of the SEIU et. al. from the AFL/CIO is more of a glimmer of hope than a death knell. The reason they left was a doctrinarial dispute over how to spend dues. The AFL/CIO favored the status quo of throwing a lot of money at politicians in order to make the legal environment a better place for Unions. The SEIU favored using a larger percentage of the dues for organizing activities. The later method is the one that the labor movement really needs to focus on if unions are going to be relevant at all, anywhere.
One method I like takes the structure of the Union and reformats it somewhat. In this era of outsourcing, it would be a very good idea to set up domestic (and foreign if it can be done) employment agencies owned by the workers themselves, or even as non-profits. This agency would then compete for contracts along side the outsource firms. The employment firm would be 'Unionized' in the sense that the firm is the Union. This has the advantage of working with free-market forces, rather than attempting to shut them out.
One reason businesses like outsource firms is that it also keeps their own Human Resources costs down. In the above case, the employment firm would provide the HR function for the positions contracted for. Workers would negotiate with the union for benefits, rather than management, and the Union as a whole would manage the 'worker money' contracted for. This pushes Unions a bit further up the budgetary food-chain when it comes to cost management.
When this method is perused along side more traditional shop-organizing activities, it has the opportunity to increase union participation across the board. Plus, it has a structure that can include international workers in a way that current Unions can't. This is the sort of organizing activity we need to do.
In the beginning Unions were formed as a way to check the power of business owners in a way the government was unwilling to do. The creation of them was not exactly easy, and faced hostile and violent opposition from business owners. In the end, the right to form Unions was recognized by the government and the right to organize was enshrined in federal law. Since those times, the government has become more protective of worker's rights than they were in the bad old days (minimum wage, child labor laws, overtime provisions, etc), so what Unions provide is not as clear as it used to be.
These days Unions are fighting tooth and nail for benefits that aren't enshrined in law, such as health care and vacation days. There have been many strikes over the past three years over the rise in health-care premiums and employers seeking concessions from Unions to pay a greater percentage of the cost. In point of fact, the cost-of-living increases many union workers get are erased and more by the rise in the health-care premium.
Then take the case of the Northwest Airlines (NWA) Mechanics. They've been on strike for over a week now, but NWA's flying schedule has not been impacted all that much. That's not how it is supposed to go with these sorts of things. Since NWA is using non-union workers to fill in the gap left behind, the FAA has increased safety inspections of NWA planes. Complicating matters is that the Airline industry has been in a bit of a contraction phase since the 9/11 attacks, so there are a lot of trained ex-airplane mechanics out there to draw on. Trained ex-mechanics who have no qualms about crossing a picket line for good money.
Big Business views Unions as a drain on the economy. They increase the costs-per-worker beyond what the free market would dictate. They introduce an inflexible element into the business plan that can be impossible to work around without conflict. These are the reasons that WalMart has closed every store that voted to organize, since Unions do impact the bottom line.
As the NWA mechanics are finding out, Unions survive longest when the business has no alternative to dealing with them. Create an environment with a lot of non-union workers out there, and the Union will be worked around. This sort of thing has happened all over the US in the wake of globalization, as the 'market' for labor has expanded greatly to include whole countries without Union movements.
Unions work best when entire market sectors are organized. The United Auto Workers were in such a place until the Japanese car makers started building car factories in the US that the UAW couldn't organize. The 'government worker' is another area where this is the case, though that too is eroding. If the entire sector is organized, free-market forces affect things like benefits and pay rates. If it isn't organized, the unionized shops (which have higher costs) have to compete against the lower-cost non-union shops. The American consumer has been proven to not care a whit about the welfare of the worker that made their $9 T-Shirt from Target, so that kind of market force won't work.
So what are we to do?
The European model is criticized by many economists for being too socialist and inflexible when it comes to responding to market forces. Germany, a haven for Unions, has been in recession for a very long time due to its inability to attract new and vibrant business. The taxes that places like Norway impose on their people would cause the average American to go into cardiac arrest. How to pay for the pensions of the now-retiring baby boom generation is threatening to break the central banks of many European nations, well before our own Social Security will go bust. While it may be comfortable to be a worker there right now, there is a reason why residents are getting up in arms over immigration, and the cheaper labor that brings.
The economy is a global thing. Widget-makers have been moving off our shores for decades now. The service economy is now following suit in the segments where telepresence (phone, e-mail ,whatnot) can be done. While the worker who weighs your bags at the airport is probably not a full time resident of India, the person who took your reservation in the first place (or the geeks who maintain the server-farm running the e-commerce application that took your order) almost definitely was. The average US worker is competing for work directly with workers in India and China, and these are countries without much collectiveist background at the grass-roots.
It is because the US worker is competing directly with foreigners for work that you get protectionist urgings from the labor camp. That'll never fly. The free market is here and established enough that these sorts of trade barriers can't stand for long. Tariffs are used to raise the US-price of goods imported from low-wage or lower-cost nations enough that the US-made goods are a hair cheaper. We had a bit of a trade war going on over steel a while back due to just this reflex.
So the US labor movement needs to adopt some new methods. This is why I see that the defection of the SEIU et. al. from the AFL/CIO is more of a glimmer of hope than a death knell. The reason they left was a doctrinarial dispute over how to spend dues. The AFL/CIO favored the status quo of throwing a lot of money at politicians in order to make the legal environment a better place for Unions. The SEIU favored using a larger percentage of the dues for organizing activities. The later method is the one that the labor movement really needs to focus on if unions are going to be relevant at all, anywhere.
One method I like takes the structure of the Union and reformats it somewhat. In this era of outsourcing, it would be a very good idea to set up domestic (and foreign if it can be done) employment agencies owned by the workers themselves, or even as non-profits. This agency would then compete for contracts along side the outsource firms. The employment firm would be 'Unionized' in the sense that the firm is the Union. This has the advantage of working with free-market forces, rather than attempting to shut them out.
One reason businesses like outsource firms is that it also keeps their own Human Resources costs down. In the above case, the employment firm would provide the HR function for the positions contracted for. Workers would negotiate with the union for benefits, rather than management, and the Union as a whole would manage the 'worker money' contracted for. This pushes Unions a bit further up the budgetary food-chain when it comes to cost management.
When this method is perused along side more traditional shop-organizing activities, it has the opportunity to increase union participation across the board. Plus, it has a structure that can include international workers in a way that current Unions can't. This is the sort of organizing activity we need to do.
posted by Corwin at 12:16 PM
