Unions forever? - vision for workers in the US

Reason, May, 1998 by Virginia Postrel

A new vision for America's workers

After a brief boost following the United Parcel Service strike, American labor unions continue to struggle. With individual workers increasingly able to strike good deals for themselves, and flexibility valued highly by both employees and employers, traditional union solidarity and detailed rules are neither as popular nor as successful as they once were.

Meanwhile, Republicans are turning up the heat on unions' political activities. On the June ballot in California is an initiative that would prohibit the use of union dues for political activities without the express permission of the dues-paying member. At least 14 other states will consider similar initiatives this year, and proponents hope to increase that count to around 40. Such restrictions are not merely a matter of partisan politics: They challenge the very idea of union solidarity, suggesting that individual members' preferences matter.

And in late February, union members voted to reject a contract that would have settled the six-year contract dispute between Caterpillar Inc. and the United Auto Workers. During the bitter strike, some 4,000 workers, out of 13,000, have crossed the picket lines, and the company has maintained operations at surprisingly high efficiency. Many observers believe the company may eventually move to decertify the UAW as the representative of Caterpillar employees. Early in the Caterpillar strike, Virginia Postrel considered the role unions might play in a free and dynamic economy. As she completes her book, The Future and Its Enemies, we reprint that editorial from June 1992.

Federal Express. MCI. Microsoft. Wal-Mart. USA Today. Nucor Steel. Apple Computer. Cable News Network.

These companies have two things in common: They represent the future of American enterprise. And they are not unionized.

Indeed, it is hard to imagine a company built on innovation, flexibility, and teamwork that could survive the rigid job categories, work rules, and periodic games of labor-management chicken that characterize union shops. So the question arises, Are unions obsolete? Or have they just been battered by greedy bosses and union-busting Republican politicians?

We've heard a lot of the second charge lately. Unions' share of the work force has been steadily shrinking since its 1945 peak of 35.5, falling to 16.1 percent in 1990. But commentators like to mark unionism's decline from 1981, when Ronald Reagan fired striking air traffic controllers.

Reagan's legacy was often invoked when Caterpillar's perennial contract dispute turned into Caterpillar's perennial strike (nine since 1944). The company threatened to hire permanent replacements for striking workers. And in negotiations, management sought to do two things unthinkable in traditional labor contracts: to pay new workers on a lower scale than current employees and to base the new contract on Caterpillar's particular circumstances rather than follow the pattern set by John Deere. That threat and those demands struck at the union movement's central tenets.

The rhetoric of solidarity has long obscured the reality of unionism: Unions drive up wages by pitting workers against workers, insiders against outsiders. Through a combination of social sanctions, physical intimidation, and government favoritism, a union maintains a worker cartel. That's why hiring permanent replacements is management's most powerful weapon and why union allies in Congress want to outlaw it.

Union supporters like to talk about the "right to strike" as a basic principle of democracy. But it's an awfully fuzzy one. In labor law, it means you can quit your job, in concert with your fellow workers, and get it back later - sort of. Whether your employer has to give you the job back depends on a lot of mind reading by government officials. Were negotiations "at an impasse"? Was management "bargaining in good faith"? Was the union?

The real right to strike is something very different from a guaranteed job. It means, quite simply, the right of workers to withhold their services at the same time, without fear of civil or criminal sanctions. As such, it is a fundamental right of free people.

And it is a potent bargaining tool. Few private employers can afford simultaneous 100 percent turnover, even temporarily, so a strike threat encourages negotiations. And once a strike is on, resolving it is almost always preferable to training a whole new work force, at least if workers have any special skills. Were the air traffic control system subject to market pressures, firing the strikers would have been much harder and banning them for life inconceivable.

Thinking of the right to strike in this way suggests the fatal flaw in traditional unionism, and a direction for a reborn union movement. Old-fashioned unionism pretends that all workers are the same, that the only difference among them is whether or not they enjoy union privileges. Insiders are valuable, outsiders worthless, but all insiders are equal. Only seniority distinguishes them.