Saturday, February 5, 2011

Good News: Efforts in Ohio and California to Abolish 'Collective Bargaining'

Like the unemployment, retirement and health care entitlements that are bankrupting our federal government, union salary, benefits and retirement packages are bankrupting states and municipalities. Critics are tackling the union problem around the country. Some are going after union political contributions, some after card check provisions, some after pro-union political appointees, and some after the benefits and salaries. The best are tackling 'collective bargaining' itself.

In Ohio Senator Shannon Jones has introduced a bill 
to prohibit the state and state employees and state institutions of higher education and their employees from collectively bargaining, to abolish salary schedules for public employees and instead require merit pay, and to make various other changes to the Collective Bargaining Law.
(H/T Mike Shedlock who discusses it here.)

Currently the one paragraph bill is a placeholder and the details are yet to be ironed out, but its specific targeting of 'collective bargaining' is significant.

Here in my state, Californians for Public Union Reform have recently filed with the state its intent to back a ballot measure to (according to its Treasurer Lanny Ebenstein) "end collective bargaining for all city, county, regional and state employees in California". According to the linked article Virginia and North Carolina already forbid collective bargaining for state employees and Wisconsin is considering the same (in addition to the effort in Ohio described above).

While many of the anti-union efforts are commendable, abolishing 'collective bargaining' is exactly the right approach. Let me explain.

'Collective bargaining' is not what its name indicates (hence the scare quotes). It is not bargaining. In fact it means exactly the opposite of what you'd guess. Collective bargaining refers to the obligation of an employer to recognize the elected representatives of a group of workers and his further obligation to negotiate with those representatives. This last part is what makes 'collective bargaining' extortion. Under collective bargaining laws, employers have to recognize an elected union and have to negotiate with them, i.e. employers are forbidden from firing their unionized employees. Under threat of fine, confiscation and/or police occupation. But a negotiation that doesn't allow one party to walk away from the table and say 'no' is not bargaining. If this kind of 'bargaining' reigned in normal society, then anyone responding to a craigslist ad would have the 'right' to purchase despite not making an offer the seller likes. If the purchaser insisted, the seller would have to continue 'bargaining' with purchaser until he got tired of it and sold at a personal loss. In the same way employers are obliged to keep on employees who's salaries or benefits they consider a loss to their company. Collective bargaining is in fact union extortion.

Should employees have the right to associate, form unions, strike, quit work? Emphatically Yes! Even state employees. But on their own time, in their own homes using their own computers and phones to communicate. These are individual rights and constitutionally protected. For the same reasons employers should have the right to fire any individual, group or all of their employees. If a group of employees organizes and decides to demand improved work conditions or higher salaries or juicy retirement benefits, they have the right to do so. And the employer has the right to grant their demands or refuse them. The employees can then quit and oblige the employer to replace them. But there's no moral or logical justification to compel the employer to continue negotiating with them if they couldn't arrive at a mutually agreeable resolution voluntarily. He has the moral right to walk away, to fire them all, just like they have the right to quit en mass. It is after all his property and he has the right to dispose of it as he pleases. And that's what 'collective bargaining' laws forbid.

Imagine if the tables were turned and employers had the right to 'employer bargaining' with employees, under which the employer could demand whatever pay reductions or workday increases he wanted, employees had to negotiate with the employer and employees couldn't quit! This could only be classified as slavery. The right to terminate the employer-employee relationship is a fundamental right of both employer and employee. The right to quit is equivalent to the right to fire. If its clear that employees have the right to quit their employment, then it should be clear that employers have the right to fire their employees. Employment should be mutually beneficial to employer and employee and open to termination by either when it becomes non-beneficial (limited of course by any voluntary contractual agreements).

Collective bargaining laws have achieved two things for unions and union members. First the negotiations strongly tend in one direction, to the (short-term) benefit of the unionized workers (until their employer moves his operations offshore). This ratcheting is inevitable given that employers are forbidden their ultimate tool: terminating employment. Second the misnamed 'collective bargaining' has given an aura of moral righteousness to the unions, who pretend to be fighting for true American values like the freedom of association. But they are not, they are fighting for values quite foreign to America, values that come from Marxist collectivism, i.e. the expropriation of the property of employers and the negation of their rights.

Unions deserve neither benefit from 'collective bargaining', neither the salaries and pensions nor the moral high ground. Take it from them. Contact your representatives and urge them to fight collective bargaining. Support the ballot initiatives when they appear.

9 comments:

  1. Good explanation, Shane. Also, under current rules, unions can stonewall, triggering a government intervention (dept of labor, NLRB, etc).

    We've let the lunatics run the asylum for too long. Hopefully, these and similar actions will reverse the trend

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  2. On a more fundamental basis, why would any contract, anywhere, collective bargaining or selling a car, be valid if any of the parties cannot enter into it or leave it of their own free will?

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  3. @Silverfiddle Yes, and worse.
    @Anon Good point.

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  4. SHANE: "Under collective bargaining laws, employers have to recognize an elected union and have to negotiate with them, i.e. employers are forbidden from firing their unionized employees. Under threat of fine, confiscation and/or police occupation. But a negotiation that doesn't allow one party to walk away from the table and say 'no' is not bargaining."

    Am I missing something? What prevents an employer from saying "No" and walking away from to Union the bargaining table?

    Also, in the context of your article it is simply the act of organizing that is protected, not assured employment.

    You seem to associate the laws protecting the act of organizing (and not firing employees for the that simple act) with an Employer not being able to "walk away" from negotiations. That's a logical stretch. The truth is, Employers walk away from negotiations all the time. Contracts often go unratified.

    There are problems with organized labor. They tend to reduce incentive, they have too large an influence on politics, and they are often short sighted, hastening their employer offshore rather than reach an equitable agreement. Contracts can be renegotiated, political influence can be(and must be)curtailed. Germany has organized labor and remains competitive. Your claims appear a bit sensational. We've seen the flip side of this coin with 19th century steel and lumber Barons reducing the american workforce to squaller and servitude while their monopolies extract the maximum amount of profits from american resources. Why trade one extreme for another?

    What we are now experiencing is global wage arbitrage in the *absence* of bubble economy. We have government largess at all levels. With many jobs completely fungible the American worker is forced to compete with his emerging market counterparts - a tough transition indeed. This is occurring across many employment categories affecting union and non-union employees alike. Would the elimination of collective bargaining really stop the offshore trend given the growth prospects emerging economies?

    This is not a defense of Unions. Unions are often a problem particularly with their perverse influence on policy, but they are far from the source of our problems. The bigger, and IMHO more relevant picture here is America must live within its means, we must have balanced trade, a balanced budget and we must foster a competitive business environment.

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  5. @Willy If an employer refuses to negotiate with a union, tries to negotiate with a competing union in the same work unit, tries to negotiate with individuals in preference to the union or heaven forbid fires the unionized employees, employees (and probably union representatives) can file a complaint with the NLRB which can then ask a judge to issue an injunction against the employer. So yes, ultimately the employer is forced to negotiate with the majority union.

    And no, its not organizing thats protected, its organizing 'without interference' which means without any ability of the employer to fire or even speak against the unions.

    So basically the employer is denied his right to his property, to choosing who he associates with and ultimately speech itself (though this last has gone back and forth in the courts).

    The 19th century barons didn't 'reduce workers to squalor'. They were already in that squalor and willing to work in horrible conditions to get out (obviously less horrible than life w/o those jobs). Once industry (directed by those barons) improved sufficiently it was no longer possible (or necessary) to hire people into such horrible conditions. They could get better work. But it was emphatically NOT the unions that improved the conditions, it was the productivity of industry.

    Yes, eliminating collective bargaining and allowing workers and employers to negotiate mutually beneficial contracts would keep more jobs in the U.S. That's already proven in microcosm by comparing states that have 'right-to-work' laws vs. those that don't. In states were its easier to establish unions and start collective bargaining, industry is driven out to states where its harder to establish unions.

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  6. Shane: "This last part is what makes 'collective bargaining' extortion. Under collective bargaining laws, employers have to recognize an elected union and have to negotiate with them, i.e. employers are forbidden from firing their unionized employees. Under threat of fine, confiscation and/or police occupation. But a negotiation that doesn't allow one party to walk away from the table and say 'no' is not bargaining."

    Reply: Sorry Shane, your argument above is incorrect which was my point. Employers can and do walk away from bargaining tables all the time. Employers are compelled to negotiate, not forced to agree, and your claim of "extortion" is a flawed logical leap.

    Shane: "So basically the employer is denied his right to his property, to choosing who he associates with and ultimately speech itself (though this last has gone back and forth in the courts)."

    Reply: Oh boy, more leaps...maybe you can cite some examples where an employers obligation to negotiate caused them to lose rights to their property.

    Shane: "Yes, eliminating collective bargaining and allowing workers and employers to negotiate mutually beneficial contracts would keep more jobs in the U.S. That's already proven in microcosm by comparing states that have 'right-to-work' laws vs. those that don't."

    Reply: 'Right to work' states ARE more competitive than states with compulsory union membership in nearly every measure. Ironically 'right to work' states *DO allow* collective bargaining! They simply free individual employees from compulsory membership. This is a good thing in that it places competitive pressures upon unions for members while at the same time motivates employers to maintain an attractive workplace. You cite an example where collective bargaining is allowed and use this to buttress your argument for the *elimination* of collective bargaining. Puzzling.

    Regarding 19th century workplace conditions, I'm not going to spell it out. There are clear and unambiguous historical facts that show how child labor laws, safety measures, basic facilities, improved wages and length of the work day came into being. An extremely cursory investigation of this matter is all that's required to settle that historical question. American workers are the beneficiaries of those struggles as evidenced by the 40 hr workweek, safe work conditions and compulsory child education. Most of these are now codified in law and no longer necessitate a trade union. But in your mind the elimination of laws protecting organization are a source of economic woes.

    To be fair, union power needs to be curtailed, political influence limited and unfair advantages eliminated. Where this has been done, such as in the 'right to work' states, positive results can be seen. Companies who conduct poor or short sighted labor negotiations will always suffer just as badly as those companies who negotiate poor or short sighted contracts for (take your pick) services, materials, energy, etc. Undue union power is an problem but a relatively minor one in comparison to the "elephant in the room".

    Organized labor goes back well over 100 years in this country. For most of that period the US has been competitive, supplying the lions share of the worlds goods and services. What we are facing now are free trade pressures where domestically born technologies and processes are exported to be performed by the cheapest available labor. Further compounding this is a perverse trade and currency scheme that has rendered the US heretofore impervious it's foolish exportation of all it's technological and intellectual advantages. The US despite it impressive record of research and innovation is now at the mercy of the lowest bidder. THIS is the crux of the matter you've missed in your rant.

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  7. @Willy I think you conceded my main point when you say that "employers are compelled to negociate" and yes they are forced to agree insofar as some ultimate 'agreement' has to be arrived at and the employer doesn't have the option of telling the union to go to hell and firing them all.

    As far as history goes, you're wrong but as you say, this isn't the place.

    I'm not sure why you keep adding "to be fair, union power needs to be curtailed, political influence limited and unfair advantages eliminated." You seem to be arguing that unions should in principle have the power they have, but it should be trimmed at the edges. This is disingenuous. If you grant the unions the extortionary power of 'collective bargaining' they'll still blaze a trail of destruction wherever they gain a foothold. You might be able to channel that destruction, but it'll still happen.

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  8. @willy

    >>Reply: Oh boy, more leaps...maybe you can cite some examples where an employers obligation to negotiate caused them to lose rights to their property.

    GM and the UAW vs. shareholders!

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