America needs labor unions

Posted by on Tue, Mar 24, 2015 @ 13:03 PM

Speaker of the House John Boehner website says "Helping to build a stronger, healthier economy for all Americans is priority number one for House Republicans". He also is one of a small but growing number of Republicans that admit income inequality is a huge obstacle to reaching this goal. Unfortunately Boehner has failed to offer any solutions to this problem beyond the standard "blame Obama" rhetoric.

Luckily for Republicans like Boehner, the party's policy from decades ago offers a simply solution to the U.S. income inequality problem. In extolling the virtues of former President Eisenhower's first term in office, the GOP platform stated, "The protection of the right of workers to organize into unions and to bargain collectively is the firm and permanent policy of the Eisenhower Administration." In fact, labor unions were so integral to America's success President Eisenhower also said "Labor is the United States. The men and women, who with their minds, their hearts and hands, create the wealth that is shared in this country--they are America."

Despite the Republican's change of heart, the value of unions to the success of the U.S. economy remains the same today. A report from the Organization of Economic Co-operation and Development finds that that income inequality cost the U.S. economy 6 to 7 percentage points of growth during the first 10 years of this century. Considering that studies have found a direct correlation between the number of people in labor unions and the distribution of wealth it becomes clear that if the Republican's goal is to build a stronger, healthier economy for all Americans, then continuing to add obstacles to organizing is the wrong approach.

Data show that in 2013, corporation's profit as a percentage of gross domestic product hit record highs, passing the record that was set just a year earlier. If trickledown theory, championed by Republicans, were ever to work, then now would be the time, since never before has there been so much available to trickle down. Unfortunately, instead of sharing these profits with the laborers who "create the wealth", the numbers show that the vast majority of the gains end up in the pockets of CEO's and shareholders.

Of course the problem isn't that Republicans are necessarily against collective bargaining or letting the workers get a greater piece of the pie. The problem is that they have latched on to every negative union stereotype they have ever heard of and created a union caricature that is antiquated and inaccurate. For example, many believe that union bosses earn outrageous sums of money, with some of the highest paid earning a little over 10 times the average union member salary. Yet of the companies that comprise Standard & Poor's top 250 the lowest ratio for CEO to employee wage is 173.

It's certainly possible that union heads bring home too much money, but it is totally disingenuous to pretend that earning 10 times as much as the average worker is an atrocity while supporting companies who pay their top brass as much as 1,795 times what the average worker makes. The reality is that, regardless of whether the organization is a union or a corporation, the money the people at the top earn results in less money for the average worker.

These people also pretend that unions have an inordinate amount of influence in politics despite the data that show corporations outspent unions 15 to 1 in the most recent Presidential election cycle.

Some people suggest union members would be better off negotiating their wages independently as though each individual has the tools and power to strike a better deal than they could get as a union member. This is a mighty peculiar argument given that nearly all corporations use the power their size affords them to gain an advantage every day. Would Wal-Mart be able to offer the deals they currently do if they only owned one small store?

Corporations also hire experts to handle nearly every facet of business. Could the CEO also do the job of the accountant, the corporate lawyer, or the salesman? Sure, but they probably aren't as good as the people who have trained for these jobs. Similarly union members have experts in negotiation represent them which are why union members get a greater share of profits and have better benefits than their non-union counterparts.

There are also people who believe unions go out of their way to protect bad members. Obviously unions would like to have as many members as possible, but in a closed shop situation, where is the incentive to retain the worst workers? The guy that is hired to replace the fired union member will automatically be enrolled in the union, so there is no benefit in holding onto bad members. This is, however, an issue in so called "right to work" (RTW) states, since the replacement employee may or may not join the union. This uncertainty may lead the unions to be slightly more protective of underperforming employees - making this a self-fulfilling prophecy for RTW advocates.

Having said that, what the unions are doing in these situations is representing the rights of the employee. The union isn't asked to be judge and jury; they are tasked with making the best case for the employee. To ask the unions to arbitrarily side with the company - against their members - suggests these people believe the corporation and their dismissal process to be infallible despite the mountains of evidence to the contrary.

In the end, there are very few people who profit from diminished union membership. Unfortunately for the vast majority of those who oppose unions they are not in the group that enjoys the monetary benefits from low unionism.

There is no doubt that unions need to make some changes to address the image problem they currently have, but to some extent that case is very easy to make. Lower union membership leads to higher income inequality which is bad for the economy. Unions are democratic capitalist organizations. If you don't like the way they are being run, become a member and vote for change. After all, Republicans have spent decades asserting that using government to pick the winners and losers is something only socialists would do.

The reality is, unions are the greatest tool at most worker's disposal for rebuilding the middle class. Advocating for the elimination of this tool is the epitome of cutting off your nose to spite your face.

Topics: Labor Unions, Construction Jobs, Union Labor

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