Card Check

Travis says:

If labor unions and liberal Democrats get their way, Congress will debate the Employee Free Choice Act (EFCA) in the coming months. The EFCA passed the House in 2007 (H.R.800; 110th Congress), but could not overcome a Senate filibuster

There are three main components of the EFCA:

1) a “card check” provision that requires employers to recognize a union after a majority of employees have signed union authorization cards,
2) binding arbitration for initial contracts, and
3) increased penalties for businesses that illegally intimidate workers to withhold union support

Much of the controversy around the EFCA centers on the card check provision, which business groups decry as undemocratic. (For example, see the National Association of Manufacturers’ anti-EFCA toolkit.) The notion that union-opponents are simply interested in free and fair elections seems disingenuous. Rather than having an unfailing love for democracy, I speculate that most business leaders simply don’t like unions, and are willing to make any argument to continue their decline.

The case against card check is simple: decisions made in public risk peer pressure or even outright coercion. If a union secretly organizes, it could get a small majority of support, and company management – or even anti-union line workers – would never have an opportunity to present the downsides of union representation. This argument fades, however, if existing rules present labor with a stacked deck, as claimed by Gordon Lafer:
 

"Apart from the use of secret ballots, there is not a single aspect of the NLRB [National Labor Relations Board] process that does not violate the norms we hold sacred for political elections. The unequal access to voter lists; the absence of financial controls; monopoly control [by employers] of both media and campaigning within the workplace; the use of economic power [by employers] to force participation in political meetings; the tolerance of thinly disguised threats; the location of voting booths on partisan grounds; open-ended delays in implementing the results of an election; and the absence of meaningful enforcement measures – every one of these constitutes a profound departure from the norms that have governed U.S. democracy since its inception." (Source)
 

A secret ballot is a good way – probably the best way – to cap off a fairly contested election, but it not the only way to indicate a preference. In our political system, we use signature petitions to recall elected officials and place citizen initiatives on ballots. If I remember correctly, my esteemed combatant once collected signatures to rally for the removal of a street sign and was apoplectic when the local authorities did not follow the wishes indicated in the petition.

I have concerns about the card check proposal as currently presented. I think it would be improved by requiring a super-majority (say 60% or two-thirds of workers) and requiring a “reflection period,” whereby card-signers must wait 30 days until their signatures become valid. But, in general, I believe that pro-labor initiatives would be good for the country, and ultimately good for business.

Our economy is distinctly out of balance. As imperfect as they are, unions have a place in restoring sanity to the compensation spectrum. As American automakers struggle to survive and other unionized industries muddle through the current recession, unions will have a chance to prove that they are more interested in serving their constituents than lining their own pockets. I hope they fulfill their promise.

Jim says:

Well, Travis, let us start with the name: “The Employee Free Choice Act.” There is nothing free about having someone else watch you vote. This act is nothing but the last gasp of a corrupt system that has outlived its usefulness. As far as our economy being “distinctly out of balance” I would have to ask, “According to whom?” Poverty in the United States is very low by historical standards, possibly as low as it has ever been in my lifetime, and, on the upper end, we are never going to all live (or want to) in gated communities.

Now, my rearing and the attitude I was taught about unions as a child has to be admitted here. In our house, the words “union” and “mafia” were used interchangeably and not as a metaphor. As a young adult, the disappearance and continuing absence of Jimmy Hoffa verifies this when I don’t bother to think too deeply (most of the time).

Before the days of government labor standards and regulation, unions had their place. Much good was accomplished by them in the late 1800s and early 1900s in terms of child labor laws, working condition improvements, worker safety, and establishing a reasonable work week. However, those gains have been made and unions have become about as useful as a women’s suffragette rally since the passage of the 19th amendment. If unions are still needed, this is probably an indication the U.S. Department of Labor is ineffective—the simultaneous existence of both unions and the Department of Labor is inefficient and redundant.

In all of the discussions in the past six months about bailing out the auto industry, it has been about bailing out the U.S. based auto industry, the one represented by the United Auto Workers. While all of the auto industry is suffering from lost sales (except for Hyundai), isn’t it interesting that the portion of the industry choked by ridiculous work rules, corrupt pension funds, and over paid union executives is the part that is on the ropes? And as for quality, there is hardly a better automobile made than the Honda you drive, made in a nonunion plant in Marysville, Ohio.

In reference to the street sign removal project (my one and only foray into politics), I would submit that people bemused by a 22-year-old wandering around the neighborhood trying to get a stop sign removed would take putting their signature on such a petition far more lightly than if their job and family income were on the line. With the reputations unions have for physical violence, even I would probably sign up for a union if I was sitting across a table from some big bully. I would also immediately start looking for another job, but I would want to keep that one in the meantime. I personally have a problem with the idea I am so weak I need someone else to represent me with my employer.

I have managed a union workforce and I have worked along side union and nonunion work forces. I would have to say it is much easier to manage a union workforce than a nonunionized one, for you simply look to the contract to see how to do things. Unfortunately, what was easy for me as a manager injected gross inefficiencies and extra costs into my employer’s operations. I have even had an unfair labor practice filed against me (I made good on a promise and tore down a break room on a paper machine after repeatedly warning the crews on that machine to clean it up; my mistake was not tearing down the break rooms on all machines, by singling them out, I was “picking on them.” The whole incident reminded me of elementary school). It did earn me the nickname “Sledge” of which I was kind of proud.

Unions are currently thriving in businesses we have not figured out how to export—state and municipal workers and public schools. This is not by accident. Overly unionize a business (such as happened to the textile industry) and watch it move overseas. Up to this point, “right to work states” have kept jobs in this country. When I was your age, companies were rapidly moving out of Wisconsin, Michigan, and other points north to right-to-work states in the South. In fact, immediately after I got out of college, I spent time in Milwaukee supervising the dismantling of a plant being moved to Kentucky. If, as part of this new surge in protecting unions, the federal government’s long arm does away with right-to-work at the state level, expect even more jobs to go overseas.

By the way, the surge in unionized government workers in the last two decades is going to introduce the United States to an unfamiliar bankruptcy term: Chapter 9. Vallejo, California, was the first city in modern times, about a year ago, to use this route to flee from onerous and outrageous city worker pensions and benefits (“Forbes” magazine, February 16, 2009, page 83). There will be more of these as bills come due for outlandish promises made through union negotiations.

There is also a surge afoot in this country to unionize health care workers. I’m sorry, but if I am under the knife, I don’t want a surgeon that has to obey work rules regarding what instrument they can pick up, or one that suddenly, in the middle of my operation, decides it is time for their negotiated coffee break. I also don’t want health care workers guilty of malpractice hiding behind some union. Until nationalized health care takes away my free choice as to where to seek health care, choosing a nonunion facility will be part of my decision-making process.

Of course, the definitive statement of union attitudes comes from Albert Shanker (1928-1997), president of the American Federation of Teachers from 1974-1997: “When school children start paying union dues, that’s when I’ll start representing the interests of school children.” I’ll give this to the dearly departed Mr. Shanker—he understood his fiduciary duty. But do you really want to send my grandson to a school where the likes of Mr. Shanker represent the teachers?

Now that I have vented a bit, let’s come back to some union concerns that could spell long term problems for the economy.

First, unions operate in a monopolistic way and monopolies are never good. Union votes, whether secret or not, are about one company and one union. If we are really interested in good independent representation for workers, why not require on a regular basis, say every four years, that two or three unions stand for election to represent the workers at a certain entity. Each union gets to make their pitch and the workers choose which one (or none) will represent them.

Second, unions resist innovation that reduces the units of labor, particularly the labor they represent, required to make a particular product. Look how unions are fighting charter schools in this country for an example. This attitude is disastrous for the economic growth of the country (See Nip Impressions, week of 09 Feb 09).

Third, unions cost too much. My Aunt Jessie spent her working life sewing women’s undergarments at a factory in Sullivan, Indiana, represented by the International Ladies Garment Worker’s Union. She didn’t want to be a union member, she was forced to if she wanted a job. She worked there until the factory had to move overseas in order to compete. She paid her dues, and went on strike when she was told to do so. She died a few years ago—her union negotiated pension was around USD 70.00 per month as recently as 2004. If she had been able to save all the money the union cost (dues, strikes, and finally her job) over her career, she would have been much better off.

Fourth, unions should have to disclose by a standardized calculation the cost each of their employees will personally incur in a strike. Strikes are very expensive for workers, a matter not often disclosed by union management. Many times strikes are not conducted for the benefit of the workers, but for the benefit of an over-arching union political goal. This is not representation in the individual worker’s best interest.

Fifth, unions currently have the right to compete unfairly in the political process. Unions can raise money, mobilize their workers, and support political campaigns bold-faced. There are bad things on the company side, too—called lobbyists. In the name of fairness, I would prohibit both companies and unions from spending a dime on campaigns or lobbying. I am in favor of unemployment—of the 15,000 plus lobbyists currently plying the halls of Congress.

Sixth, unions have illegally infiltrated the political system. President Obama’s nominee (as of this writing) for Labor Secretary, California Rep. Hilda Solis, has had to disclose she has been an unpaid treasurer and board member of a labor advocacy group while a sitting representative in Congress, a clear violation of Congress’s own ethics rules. Such shenanigans only reinforce everything I have said above.

In short, I don’t trust unions. I acknowledge that one time, a long time ago, they did some good. Today, they seem to line the pockets of union leaders and promote a stifled, status quo economy. The areas where they helped are now largely covered by the Department of Labor, and if they are not, we should fix the Department of Labor, not allow competing, redundant systems that are a drain on the economy.