Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Silver Price 2021 Roadmap - 22nd Jan 21
Why Biden Wants to Win the Fight for $15 Federal Minimum Wage - 22nd Jan 21
Here’s Why Gold Recently Moved Up - 22nd Jan 21
US Dollar Decline creates New Sector Opportunities to Trade - 22nd Jan 21
Sandisk Extreme Micro SDXC Memory Card Read Write Speed Test Actual vs Sales Pitch - 22nd Jan 21
NHS Recommends Oximeter Oxygen Sensor Monitors for Everyone 10 Months Late! - 22nd Jan 21
DoorDash Has All the Makings of the “Next Amazon” - 22nd Jan 21
How to Survive a Silver-Gold Sucker Punch - 22nd Jan 21
2021: The Year of the Gripping Hand - 22nd Jan 21
Technology Minerals appoints ex-BP Petrochemicals CEO as Advisor - 22nd Jan 21
Gold Price Drops Amid Stimulus and Poor Data - 21st Jan 21
Protecting the Vulnerable 2021 - 21st Jan 21
How To Play The Next Stage Of The Marijuana Boom - 21st Jan 21
UK Schools Lockdown 2021 Covid Education Crisis - Home Learning Routine - 21st Jan 21
General Artificial Intelligence Was BORN in 2020! GPT-3, Deep Mind - 20th Jan 21
Bitcoin Price Crash: FCA Warning Was a Slap in the Face. But Not the Cause - 20th Jan 21
US Coronavirus Pandemic 2021 - We’re Going to Need More Than a Vaccine - 20th Jan 21
The Biggest Biotech Story Of 2021? - 20th Jan 21
Biden Bailout, Democrat Takeover to Drive Americans into Gold - 20th Jan 21
Pandemic 2020 Is Gone! Will 2021 Be Better for Gold? - 20th Jan 21
Trump and Coronavirus Pandemic Final US Catastrophe 2021 - 19th Jan 21
How To Find Market Momentum Trades for Explosive Gains - 19th Jan 21
Cryptos: 5 Simple Strategies to Catch the Next Opportunity - 19th Jan 21
Who Will NEXT Be Removed from the Internet? - 19th Jan 21
This Small Company Could Revolutionize The Trillion-Dollar Drug Sector - 19th Jan 21
Gold/SPX Ratio and the Gold Stock Case - 18th Jan 21
More Stock Market Speculative Signs, Energy Rebound, Commodities Breakout - 18th Jan 21
Higher Yields Hit Gold Price, But for How Long? - 18th Jan 21
Some Basic Facts About Forex Trading - 18th Jan 21
Custom Build PC 2021 - Ryzen 5950x, RTX 3080, 64gb DDR4 Specs - Scan Computers 3SX Order Day 11 - 17th Jan 21
UK Car MOT Covid-19 Lockdown Extension 2021 - 17th Jan 21
Why Nvidia Is My “Slam Dunk” Stock Investment for the Decade - 16th Jan 21
Three Financial Markets Price Drivers in a Globalized World - 16th Jan 21
Sheffield Turns Coronavirus Tide, Covid-19 Infections Half Rest of England, implies Fast Pandemic Recovery - 16th Jan 21
Covid and Democrat Blue Wave Beats Gold - 15th Jan 21
On Regime Change, Reputations, the Markets, and Gold and Silver - 15th Jan 21
US Coronavirus Pandemic Final Catastrophe 2021 - 15th Jan 21
The World’s Next Great Onshore Oil Discovery Could Be Here - 15th Jan 21
UK Coronavirus Final Pandemic Catastrophe 2021 - 14th Jan 21
Here's Why Blind Contrarianism Investing Failed in 2020 - 14th Jan 21
US Yield Curve Relentlessly Steepens, Whilst Gold Price Builds a Handle - 14th Jan 21
NEW UK MOT Extensions or has my Car Plate Been Cloned? - 14th Jan 21
How to Save Money While Decorating Your First House - 14th Jan 21
Car Number Plate Cloned Detective Work - PY16 JXV - 14th Jan 21
Big Oil Missed This, Now It Could Be Worth Billions - 14th Jan 21
Are you a Forex trader who needs a bank account? We have the solution! - 14th Jan 21
Finetero Review – Accurate and Efficient Stock Trading Services? - 14th Jan 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Smash the Labor Monopolies!

Politics / Employment Sep 15, 2009 - 09:35 PM GMT

By: Ayn_Rand

Politics

Thomas Bowden writes: When President Obama addresses the AFL-CIO on Sept. 15, he is expected to reiterate his support for the so-called Employee Free Choice Act. Congress is sharply divided over the proposed law, which would change the voting and arbitration procedures by which federal law forces companies to deal with labor unions.


Because the changes favor Big Labor, pro-union Democrats have been locked in a prolonged partisan squabble with their Republican opponents, and legislative compromise seems likely. But that’s really beside the point. Instead of quibbling over the methods by which unions can be forced upon unwilling employers and employees, Congress should be debating how to make the labor market truly free--free from government coercion.

For more than 70 years, Congress has maintained a statutory scheme that fastens coercive labor monopolies on individual companies. Starting with the Wagner Act in 1935, any union that wins a simple majority of employee votes becomes, by force of law, the exclusive bargaining agent for every single employee in that workplace. Such a victory slams the door shut on individuals who want to deal directly with the company, and leaves the union with a government-protected stranglehold on that firm’s labor supply. Predictably, these company-by-company labor monopolies have had the kind of deadening effects that come with all coercive monopolies.

Here’s how it works in practice: Each company is required by law to “bargain in good faith” with the union before making any important decision affecting jobs, wages, or working conditions. The union, in its legally privileged position, can just say no. When pressed, it can mobilize a crippling strike even if thousands of employees would rather keep working--because here, too, the outcome of an employee majority vote binds everyone. Usually, however, the mere threat of such a strike is enough to keep employers in line.

Now suppose a unionized firm wants to sell or close an unprofitable plant, or revamp a workflow to save expenses. At the “bargaining” table, the union’s predictable resistance is typically followed by one of two results. Either the union stands firm, in which case the unprofitable practices continue--or the union acquiesces, in exchange for higher wages and benefits, or a job for the shop steward’s son, or some other favor. This is not genuine bargaining but organized extortion, made possible by federal labor law.

So, while non-unionized competitors charge ahead with nimble, inventive, rapid responses to market challenges, unionized companies learn to slow down, “negotiate,” compromise, draw up rules--in other words, kowtow to the union. The inevitable results are bloated prices and declining product quality, as witness the domestic auto industry.

Detroit’s automakers, having suffered through painful work stoppages in the decades following World War II, discovered they could avoid labor unrest by caving in to the United Auto Workers’ demands. Over the years, meeting those demands gave rise to labor agreements as thick as telephone books, testaments to the stultifying regimentation that sapped Detroit’s competitive juices.

Because car manufacturing is complex and capital intensive, many years passed before competitors from Japan, Korea, and Germany could establish non-unionized plants in America’s southland. Now, however, the sun is setting on Detroit. GM and Chrysler are writhing in red ink, drained to the point of bankruptcy by costly union concessions, and Ford struggles to survive.

Not all labor unions wield UAW-level power, but most would like to. That’s why the Employee Free Choice Act would eliminate secret ballots in union elections and replace them with individually signed cards, open to union inspection. This would allow union organizers to more easily target, and intimidate, anti-union employees--and therefore win more often. The Act would also allow government arbitrators to impose initial “contract” terms if the union and employer disagree. That’s contrary to existing law, which allows for a no-contract impasse in that situation.

Congress should not only reject the transparent power grab known as the Employee Free Choice Act, it should start hacking at the root of the complex federal regime that denies free choice in bargaining. That means repealing the Wagner Act, so that labor law can recognize and protect the absolute right of companies and employees to deal with each other on an entirely voluntary basis.

www.aynrand.org

Mr. Bowden is an analyst at the Ayn Rand Center for Individual Rights, focusing on legal issues. A former lawyer and law school instructor, and author of the book “The Enemies of Christopher Columbus,” his op-eds have appeared in the Wall Street Journal, Philadelphia Inquirer, Miami Herald, Los Angeles Daily News, and many other newspapers. Mr. Bowden has given dozens of radio interviews and has appeared on Fox News Channel’s Hannity & Colmes.

Copyright © 2009 Ayn Rand® Center for Individual Rights. All rights reserved.

Ayn Rand Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules