Are unions necessary?

Short answer: Yes.

The question is posed by an exchange launched by Evan Soltas at Bloomberg View, and answered by Michael Wasser of the workers rights organization Jobs for Justice. Soltas has defended himself against Wasser’s response, so this could go on for a while.

The discussion was inspired by the recent defeat of a United Auto Workers drive at the Chattanooga, Tenn., plant of Volkswagen, which we discuss here. The case has inspired lots of commentary about the long-term decline of industrial unions in the U.S. and the role of that trend in the increasing of income inequality. The two trends coincide, so there really is no question that the decline of workers’ voice and worker rights resulting from the decline of unions has played an important role in the rising power of the shareholding and managerial class.

One hates to say of a writer as fluent as Soltas that his analysis lacks the depth that would come from experience, but Wasser is certainly correct in arguing that Soltas’ argument that the U.S. is better off without unions and “unions can’t be saved� reflects the limitations of textbook-learning. A few specific issues:

To think that federal labor law has had “little to do� with union decline, as Soltas puts it, is hopelessly naive. He’s misled by the fact that union membership has fallen even though we have laws guaranteeing the right to collective bargaining, and by the failure to recognize how inadequately those laws are enforced.

“Soltas doesn’t even consider the ramifications of broken labor law,� Wasser observes, and he’s right. “Without any real penalties to fear, employers have an economic incentive to violate federal labor law. Research shows that indeed they regularly do, using a variety of often unlawful tactics to coerce and intimidate workers during union organizing campaigns.�

When the employers don’t do so, political representatives of the capital-holding class will, as was seen in Chattanooga, where politicians used the threat of the withdrawal of government subsidies, and the impact that would have on the workforce, as a weapon against the union.

Over the years, employers have developed an exquisite arsenal against union organizing. For a succinct description of how the war is waged, Soltas needs to examine “Confessions of a Union Buster,� the heartfelt memoir Martin Jay Levitt published in 1993.

“I come from a very dirty business,� Levitt told a carpenters union audience (after his conversion). As he described it, “the enemy was the collective spirit. I got hold of that spirit while it was still a seedling; I poisoned it, choked it, bludgeoned it if I had to, anything to be sure it would never blossom into a united work force, the dreaded foe of any corporate tyrant.�

One simply can’t explain the decline of union representation without acknowledging the role of employer opposition and its empowerment by government policy, as outlined in this 2009 report from the Economic Policy Institute. The government role includes not merely the behavior of the Tennessee GOP, but “right to work� laws, and the enfeeblement of the National Labor Relations Board and its intimidation by members of Congress.

It’s also important to understand two additional factors that make union organizing difficult, and which can’t be absorbed from college textbooks or academic papers: fear and complacency. Fear reigns during periods of slack employment and job growth, when workers perceive that the surfeit of replacement labor makes it costless for employers to sack them for any reason at all, including labor organizing. Lax enforcement of labor law plays into this in a big way.

Complacency reigns during periods of tight labor supply and prosperity, when the workforce figures, why siphon off part of my paycheck in union dues, since I’m already well-paid and reasonably secure? To a certain extent this was a factor in Chattanooga, where workers considered themselves well-paid and well-treated, and therefore couldn’t fully comprehend what more union membership would get them.

Fear has been the dominant factor over the last decade or so of economic underperformance, but they’re both obstacles to union growth.

Yet we must ask why employers would so assiduously fight unions if not for fear of their effectiveness? Soltas’ take on the union’s role in the workplace is by far the most naive element of his original piece. He cites a judgment by two academic economists that unions balance power between employers and workers, and that this role is important but not entirely positive. “They’re right,� he concludes. Although union power “helps union members, it’s inefficient and bad for the economy as a whole, and it’s especially bad for nonunion workers.�

Soltas cites no authority for these statements. That’s unsurprising because they’re nonsensical. The only vantage point from which union power can be seen as inefficient and bad for the economy is that of rent-seeking management, which is far more inefficient and bad for the economy--that’s exactly what has led to income inequality and the stagnation of economic growth that is its consequence. As Brad DeLong of UC Berkeley wrote recently, “Tell me, if you can do so with a straight face, that any aspect of the large upward leap in inequality we have experienced has paid any benefits at all in terms of true … human material welfare-enhancing economic growth. I don’t think you can.�

As for the benefits unions have brought to nonunion workers, they’re legion: progressive workplace laws including safety and child labor regulations, overall higher wages, retirement and healthcare benefits. The decline of all these features of the American workplace has coincided exactly with the decline of unions. That should tell you something.

Soltas argues that the answer to the decline of unions is to “stop businesses from abusing labor laws by classifying their employees as independent contractors.� We should institute “monetary and fiscal policies aimed at full employment,� he says.

Where does he think the impetus for these advances will come from, if not the labor movement? He may not have noticed, but Congress today is in the grip of the employer class. They’re not agitating for tighter enforcement of labor laws, and they’re not speaking up for full employment, either--that just means they’d have to pay higher wages, and who needs that?