Unions have done some good in the early days of our country, gaining workers higher wages so they could buy the products they were producing, although workers flocked to Detroit for the $5/day wage long before unions. Nowadays they can be useful in developing countries to improve working conditions and have even played a part in bringing down communist governments (Poland comes to mind).
In general they are extra overhead, with part of the workers’ wages going to pay union dues and lobby for political causes not all workers agree with. Progressive non-union companies can attract workers at higher pay without the extra layer of bureaucracy. Companies with better safety records can attract workers – safety sells.
For these reasons, private sector union membership has declined, and work has fled to right-to-work states. My home state of Indiana just became the 23rd right to work state. Sometimes non-union wages are lower, but not always. Auto transplant and supplier wages are comparable in union and non-union plants. Non-union workers in the local economy often resent the unionized workers for their higher pay which drives up the cost of living.
The main purpose of collective bargaining units is to get higher than market wages and benefits for their members, not to serve the customers better. This is fine in the private sector where there are competitive pressures and real customers, because if the workers are overpriced it will drive the company out of business. (Poor management and poor quality products will sink companies too.)
Public sector union membership has increased
Private sector union membership peaked in the 1950s and has declined since then. Fifty-two percent of U.S. union members now work for a government. Government workers are much better insulated from the end-use customer (or parents of the students), so the level of bureaucracy is not as noticeable without competitive pressures.
The union dues of public sector unions go to elect liberal Democratic politicians, who make promises they know will break the budgets of their state and local governments. And we all know the federal budget is out of control. It’s also too bad for conservative teachers, who are forced to subsidize social causes they don’t believe in.
Divisive strikes in the 1970s
My hometown of Highland, Indiana, had a teacher’s strike when I was in seventh grade. The kids were off school for several weeks while the teachers walked the picket line. It was part of the Indiana teacher’s union’s master strike plan to get higher wages statewide. The outside influences nearly tore our town apart as many of the residents were steelworkers and felt loyalty to the strikers even though their kids were suffering. My math teacher held class for her students anyway; no doubt she was unpopular with some of her fellow teachers but the kids whose parents allowed them to cross the picket line loved her for it.
I had 3 jobs in high school; two were at minimum wage, and the third was bagging groceries at a little more than minimum wage, but the extra pay was eaten up by union dues. When I went to college, I studied engineering and took a coop job with Caterpillar in Peoria, Illinois. My first coop session was in the East Peoria tractor plant as a UAW member. It was to be split in thirds, with one session to be in the training shop to learn how to use the machine tools.
That fall, the contract with the Big Three agriculture implement makers was up, and once again John Deere was stronger financially than Caterpillar and International Harvester. The local union leaders were upset that Cat had been passed over as a strike target for the third contract in a row, so they voted to go on an unauthorized strike. The local union president voted once and then again to break the tie (so much for Roberts’ Rules of Order).
So Caterpillar was on strike from the end of September until right before Christmas. Nothing was gained since the union didn’t negotiate with Cat until the Deere strike was settled; the workers had to survive on approximately $100 per week strike pay. Meanwhile, another city was divided by a strike since Caterpillar was the largest employer. I missed getting machine shop training, went home and substitute taught.
Strikes don’t help anyone. For me it was an inconvenience and loss of earnings for school; for workers trying to feed their families, strikes cause serious financial pain.
New Tactics – Badgering the Budget Balancers
Teachers and government workers strikes are now illegal or highly discouraged. So the unions have adopted more effective tactics: coercion and influence of elected officials. In New Jersey even the liberal newspapers were critical of Democratic governor Jon Corzine for being too cozy with the public sector unions.
Recent pitched battles between governors of Wisconsin, Ohio and Michigan and public sector employees have drawn out of town protestors, the Occupy movement and the usual crew of race-baiting liberals.
When Governor Scott Walker spoke at a fundraiser in Troy, he drew 2000 protestors, most from out of town. Some reporters wrote only about the grievances of the teachers and other protestors, but didn't write about the contents of Walker's speech. What about the people attending the speech who felt intimidated by the angry protestors?
The noisy 10 percent and sympathizers
Some protestors had signs saying “We are the 99%,” but they are the noisy 10%, with another 10% or 20% who sympathize with them. Meanwhile, the taxpayers pay ever higher wages and benefits compared to similar work in the private sector.
Someday soon, we will reach a tipping point. Fortunately, many of our states require a balanced budget, so the day of reckoning comes soon for those states, and they will be healthier in the long run. Already states like Illinois and New York that have raised taxes to solve their budget problems have seen business leave for neighboring states.
Meanwhile, the federal government continues to spend 40% more than it takes in. The U.S. is piling up debt and headed on a slippery slope toward Greece in a few years if we don’t do something soon. The battle is heating up for November, with clear consequences and choices. It will be up to the voters to sort through the demonizing and determine the best way forward.