I think that unions are terribly misunderstood by a lot of people. People grouse about them all the time. On conservative websites, I often see comments that blame “unions” for a lot of the problems we have.
I think that you need to compartmentalize and segment “unions”. There are private-sector unions and there are public-sector unions. Both have a checkered past as far as their leadership goes. Jimmy Hoffa wasn’t a nice guy. But, it’s not 1960 anymore.
Public sector unions are in fact toxic. Even FDR, a big pro-union guy, said: “insurmountable limitations when applied to public personnel management.” FDR believed that the people and Congress employed government workers and represented “the people” in determining government employee pay.
What we have seen is the Democratic Party embracing public sector unions. They are a huge money source for them. As a result, in Democratic Machine states, the person “representing the people” were duly funded and elected by the union sitting across the table from them. It’s hardly a negotiation at all.
It’s kind of funny that my Democratic acquaintances scream and stamp their feet about corporations exercising free speech rights to send money to political parties but don’t think it’s exactly the same when virtually all unions send their money to ONE political party. As we have seen over the past few years, just because you are a corporation doesn’t mean you are knee jerk Republican. Most of the major corporations and certainly Wall Street send their money to the Democrats, not Republicans.
Public sector unions are not beholden to the laws of economics. Instead what happens is everyone’s taxes go up endlessly and we see states like Illinois accumulate massive pension debt.
During Covid, we have seen the public sector teachers union unmask itself. It’s not about the children. It’s about the teachers. The union single-handedly has killed public education over time. Send your kid to a government run school, and you are guaranteeing that they start the race of life behind.
But, it’s more than that. Does anyone enjoy a trip to the Department of Motor Vehicles? Lots of waiting in line and red tape courtesy of public sector unions that don’t want to embrace change or new technology to get things done faster. We can mail in our ballots to vote, but we can’t mail in anything to the DMV.
During Covid, I did a home rehab. It’s still not finished because of Covid’s effects on the supply chain and workforce. My contractor is pulling his hair out. We should have had a clue when we started. The county department was all work from home and my permitting process took three months more than it was supposed to.
The government doesn’t work for the people anymore. It works for public sector unions. Get in line because citizens will never get to the front of it.
On the other hand, there are private-sector unions. They catch a lot of grief but in many cases it is unnecessary. The private unions have a vested interest in the company they work for to survive. They are indirectly beholden to the marketplace, supply and demand, and price elasticity.
The private sector unions can provide valuable training to people. They can make sure working conditions are safe. They can provide nice benefits to workers and make sure that they are saving for things like a pension.
It’s also easier for a big company to negotiate with a commodity pool of workers rather than negotiate with each and every worker. During the negotiation, the company and union can have an arms-length transaction that sets standards of safety, and hours worked. It helps the company figure out its expected labor costs over the long run so it can effectively price other inputs and price for the overall market.
Unions also get educated on the market and understand what management is thinking.
Even private-sector unions can screw up the economics of a business. When you set the payscale artifically too high, you get a mismatch of labor.
Of course, private-sector unions can get cocky too. The United Autoworkers were a huge problem for the Big Three automakers because they refused to change as the underlying market changed. However, the management of the Big 3 automakers isn’t exactly innocent. They totally dropped the ball themselves. It was a huge mistake and miscalculation by both sides that destroyed an American city, Detroit. Detroit still hasn’t come back.
In business school, we did an interesting case on unions. Lincoln Electric is a manufacturing company based in Ohio. The case we did was on how management would negotiate with the union so everyone would win and the company could remain competitive in the marketplace. For people like me that went into the case with an anti-union bias, it was eye-opening because the union actually worked hand in hand with management to make sure the company achieved its strategic goals, but still tried to get as much consumer surplus out of the cash flows of the company for its members.
The relationship at the company was symbiotic, not antagonistic.
I think that private-sector union bosses make a huge mistake casting their lot with the Democratic Party. They forget that their unions are employed by capitalistic companies. Those companies are subject to the business cycle, laws of supply and demand, and that filters down to the union members. My new hometown of Las Vegas has very powerful private-sector unions.
Union membership has dropped precipitously over the years. Part of the reason is manufacturing has moved from the industrialized over-politicized northern states to right-to-work states in the South. No one builds a new factory in a place like New Jersey or Illinois. They build in places like South Carolina.
Another big reason that union membership is dropping is that there is no good reason to be in the union. Pay isn’t higher, and the dues simply go to a huge hierarchy that is looking out for the hierarchy and not the union member.
Private sector unions can be a very good thing for workers. As long as the management hierarchy remembers that they work for the workers, and not themselves or the politicians that they send money to.