On ports: the busiest container port in the UK is in Felixstowe, a random small town whose one distinguishing feature is that, when containerization became a thing in the 60s, it was the only British port too small to have a union (every port that did have a union blocked the use of containerization, partly because they were worried about the impact on jobs and partly because it's a lot harder to steal a bottle of whiskey from the cargo when it's in a container).
On seniority precedent: a non-meritocracy related type of damage is that it just makes job allocation harder. For example, in the NYC subway, conductors get to pick their lines by seniority, which means junior conductors often have to keep switching routes, often to ones that start a two hour commute away.
Thanks. I got the stat from The Box (the container shipping book), but makes sense that it's evened out a bit since then now that every port does container shipping (also plausibly the book was exaggerating even for the time, although it's generally pretty good about accuracy).
Without that seniority practice in place all the workers would find themselves being switched on routes and management playing favorites. Nepotism comes into play.
I don't know how airlines do it, but since they're private sector I assume it's not quite as badly handled (for the reasons mentioned in the later part of the post).
My first exposure to unions was before I worked in online marketing, I had an English Education degree and had to complete an internship by teaching for a semester. We had to sign up for the NEA even when in college, I'm sure to funnel them more money and bolster their numbers - while getting us in the habit of mindlessly supporting them before having real world professional experience.
When I was teaching and interacting with other teachers, the topic of unions came up from time to time. It was a clearly parasitic relationship, the idea being that we were looking out for ourselves against society, namely the parents and government. It was funny hearing leftists online suggest that this was an entirely pro-social arrangement given that actual union members were much more realistic and grounded about the entreprise.
You missed the boat so completely as to call into question what you think a Libertarian is. Labor unions are a free association. No real libertarian would ever want to ban individuals from forming and joining such an organization, as it would limit freedom (the entire point of libertarians is to increase freedom). Furthermore, the increase in cost is a feature, not a bug. Your example of the longshoremen earning a living wage in an expensive place is an example of labor unions working. Importers are free to use alternative ports. Mexico is right there, free of longshoremen. We would see many imports choosing that option if the microscopic impact of longshoremen's wages were in any way significant (they are not).
The entire point of unions is to meet at eye level large corporations that have an unequal ability to suppress wages, especially in small towns where alternative employment is rare. Furthermore, workers favor many expensive, pareto suboptimal career benefits such as employing workers after they are no longer in the prime of their lives. This pushes employers to avoid practices that wear down the bodies of their employees. The policies of layoffs and rehiring is also one that employers love and employees hate. Higher labor costs are worth the lower volatility once an individual is hired. Such policies will be managed one way or another, and labor unions negotiating in a market is superior to the regulatory alternative.
Remember, unions only arose in opposition to market failures in employment, workers compensation and dangerous workplace practices. Unions allowed for private sector corrections without excessive government intervention. The alternative means MORE regulations, a larger, stronger OSHA, and likely a set of rules so cumbersome as to make new company formation rare. We need less regulation and more unions, not the alternative that has restrained our economy for the last fifty years (declining unions with ever increasing regulation).
As with all things, labor unions have a cost. It is a cost their members CHOOSE to bear and benefit from. There are externalities, of course, as all actors in an economy have. This is a fact of life. There are real reasons to oppose unions for public sector workers. That makes sense given the absence of an opposing shareholder (public sector managers have no profit to manage, and no incentives to keep costs down). There is no reason why private sector workers should not have the right to organize and demand a larger share of value added. If this imposes costs on others, so be it. If the cost is too high, the companies they work at will fail. The system works. Private sector workers should enjoy their right to organize, and have the ability to opt out. I would agree with you that workers should have that ability to say no. Requirements that all employees must pay for all union services are wrong. Workers should at the least be able to opt out of political expenditures. Public sector employees should have the right to opt out of all union dues, and frankly should not exist at all, but given the relentless persecution of unions along with the senseless attacks on work in general, this has never been a realistic goal.
The alternatives to the mass unionization the US had in the 1950's and 1960's is mass government regulation and the dumping of corporate externalities on the public. This has been right in line with high taxes on earned income and foolishly low taxes on capital gains. We would be better off eliminating such distinctions and having the same rates on all income of any kind, ideally with an end to corporate taxation (only taxing income distributed to shareholders).
Thanks for the interesting comment, Garry. Hope you don’t mind if I offer my perspective…
“Labor unions are a free association.”
Libertarians and classical liberals would indeed praise free association. What they (and you below) reject are unions which force employees and prospective employees to join against their will and force employers to bargain with the resulting cartel rather than other free alternatives. A closed shop union effectively uses government force to mandate that an employer bargains with a labor monopoly.
“the increase in cost is a feature, not a bug.”
The cost increases of wages is a bug if it costs more than is gained with productivity. The term for this is “rent seeking,” and it makes a market less competitive and efficient as RH has already clearly explained.
“The entire point of unions is to meet at eye level large corporations that have an unequal ability to suppress wages, especially in small towns where alternative employment is rare.”
Large firms in free markets have in fact been unable to suppress wages. Every large employer (all non union) I ever worked for constantly increased wages and benefits both over time on average, and specifically for me and the countless other employees who gained value through experience and promotions. Our productivity (or marginal productivity) increased and so did our wages. But I can see the hypothetical value of voluntary unions in small towns.
“This pushes employers to avoid practices that wear down the bodies of their employees. The policies of layoffs and rehiring is also one that employers love and employees hate. Higher labor costs are worth the lower volatility once an individual is hired. Such policies will be managed one way or another, and labor unions negotiating in a market is superior to the regulatory alternative.”
But there is another alternative. The alternative is that employers compete for employees and they do so not just with wages, but also with benefits, working conditions, reputation, and so on. Unions can supplement competition in some places and conditions, but in many cases (such as government and closed shops) they can also make the competitive forces less effective.
“…unions only arose in opposition to market failures in employment, workers compensation and dangerous workplace practices.”
I disagree. Cartels, guilds, monopolies and rent seeking arise anywhere they can arise, and then they rationalize and justify their parasitic nature with arguments that seem plausible.
“Private sector workers should enjoy their right to organize, and have the ability to opt out.”
Agreed.
“The alternatives to the mass unionization the US had in the 1950's and 1960's is mass government regulation and the dumping of corporate externalities on the public.”
If true, this might be a decent argument. What proof can you offer that it is true?
I would also add that our welfare state spends trillions per year and does not do a very good job of helping the poor and working class.
I wish the Right talked far more about how we can reform the American welfare state to produce better results with less spending, but they are typically dead silent. I have a few ideas of how we can do this:
Just as with the previous article, doesn't all this also apply (mutatis mutandis) to physicians, lawyers, accountants, academics, etc.: the gentrified unions that are known as “professions”? If not, why not?
Yes. Why is this even a question? I didn’t make the argument for every single profession. Those professions are in even worse shape because of credentialism.
Because the distinction is frequently omitted intentionally, as you were noting above about Yglesias and unions. Healthcare is about 18% of Americas gdp and that's going to increase.
And for every complaint you posted about union guys refusing to do X, there's a dozen examples in healthcare.
Credentials restrict the supply of entrants to a profession, but they don't go on strike together, crafting collective contracts that bind what their clients can do.
It’s true that they don’t go on strike, but it’s untrue that they don’t effectively create contracts that bind what their clients can do. Take the realtors, as an obvious example. And lawyers have all sorts of rule that limit competition, competing on price, etc.
Restrictions on advertising prices are different from restrictions on prices themselves. People with less money can still get legal representation, it's just harder to know whether it's a good deal.
Zero argument. But it is still a way that the legal profession credentialists limit the competitive market, to the advantage of the credentialed and the detriment of consumers. Which was the original point in this thread.
The one point imo you failed to make explicitly is that public sector unions are worse than private sector unions precisely because they get involved with politics.
There is nothing at all inherently wrong with private sector unions (so long as there is free association, rather than must-join laws) getting involved in politics, but it is wrong that *public* sector unions can participate in politics, as they are picking the people on the opposite side of the bargaining table.
FDR - perhaps the ultimate leftist icon - understood this, and said so.
Private sector unions get involved in politics as well, but they aren't on both sides of the negotiating table (unless you count other countries where labor unions elect members of corporate boards, but that's separate from electoral politics).
Exactly. Which is why it’s ok that private unions get involved in politics, but not ok for public unions to do so.
[I ain’t a big supporter of private unions, for most of the reasons Richard notes. But public sector unions are imo wrong for reasons that are beyond what Richard covered. I can perhaps make a partial exception for police unions - e.g. to protect officers from politicians wanting to score political points, and also since cops can’t strike - so long as they don’t get involved in electoral politics at all. But even they probably have too much power. But allowing unionization for ordinary government workers is ridiculous, yet it remains because of the huge political benefits for leftists.]
Another aspect of unions is that the contracts they achieve set a standard for all working conditions and compensation. All workers have the option of unionizing and employers know that. You can't suppose that what non union workers get is a non union result and then suppose it's a demonstration that not being unionized is ok.
He addressed that argument. Improvements in wages, hours, and working conditions predate unions. And in fact began when unions were affirmatively unlawful.
My understanding is that Scandinavian countries tend to have large labor unions that cover a significant percentage of the workforce, and are thus invested in overall economic growth. The UK traditionally had much smaller craft unions with narrow interests who would be willing to go on strike and disrupt other sectors of the economy.
What are you talking about? The "Spanish miracle" occurred when Franco got rid of the Falangists in his government who'd been doing a poor job of managing the economy and replaced them with Opus Dei members.
I was responding to your point about Scandinavian Unions. The idea of having large unions that are effectively just arms of the state and take the general interest into account is originally a fascist idea.
Libertarianism is superior as an economic system to fascism, but there is no incentive for an elite to support it, and it also has no popular support. It doesn't even qualify as an unstable system, because you can't set it up in the first place.
I think Scandinavian social democracy can have some things in common with fascism without being the same as fascism. And of course they had to enact neoliberal reforms when social democracies started faltering in the 70s.
Iceland appears to have had libertarian anarchism in its past.
The idea that modern labor practices could have come about naturally as the country became wealthier defies basic logic. Getting those practices changed took massive amounts of effort and collaboration between huge numbers of people who had to create organizations from scratch. You don't go to that effort unless something bad is happening for a long time. Individual catastrophes like the Triangle Shirt Factory fire supercharged these movements, but the problems that needed to be solved had existed for decades without the market changing its labor practices. Instead, the labor practices changed, and companies that adopted unions continued to grow.
"The Nordic social democracies are wealthy" -The Nordic social democracies have a system where unions are required across an entire industry, a pretty great idea because if only McDonalds gets a union, they will be at a competitive disadvantage compared to other fast food companies. So I agree with you that adopting their policies would be a good idea.
"During covid, the US was an outlier in terms of masking and school closures. Teachers unions were the primary reason for this." -Except that most all those other countries also have teacher unions.
Wages are different than prices, competition in the market doesn't function the same way. The difference between having a low wage job and a high wage job is less than the difference between having a low wage job and no job at all. If the price of eggs goes up you can eat something else for breakfast, being unemployed for even a short period of time can be ruinous. Adding to that is the fact that no one knows what a competitive wage is because employers can hide wages, which suppresses competition. Just getting to know the possible wage at a single company could take months and multiple interviews. Imagine having to shop for groceries but each store only has a couple products and they won't agree to tell you even a ballpark price until you go through an interview process and tentatively commit to buying. Unions make wages public, and tilt the market to give slightly more bargaining power to workers.
"Even without unions, businesses have an interest in keeping their workers happy."
Only someone who has not spent much time working in private industry could say that with a straight face. I agree that in theory it would make sense for employers to keep their workers happy, but typically in practice they don't. Managers regularly undervalue existing employees and will hire less qualified workers at higher wages. This is the main reason you can radically improve wages by changing jobs frequently. If you want to maximize wages you need to extract value from the business by using them to accumulate experience and skills, then market those skills to employers who haven't had to invest yet. No one wants to hire someone without industry experience, but if you get your foot in the door at one job, the world is your oyster. Turnover is extremely costly for businesses, but they rarely focus on it because it's a hidden cost and managing people is difficult.
I had personal experience with this. Working at a power plant is a job that requires years of training just to be halfway good at. Even if a person has experience on similar systems, it still takes months of training on our specific systems for them to be anything but a drag and years to be proficient enough to operate independently. Despite this, our manager would actively make everyone as miserable as possible, refuse wage increases for people with seniority, and hire people with less experience at higher wages. When I was first hired there was very little turnover. By the time I was miserable enough to leave, there was only one operator left with more than 5 years of experience. That lack of experience costs the company money, but they probably won't notice because it's difficult to attribute any single incident to inexperience.
There are many benefits to unions that you don't realize. Unions can make up for bad managers because managers are forced to follow rules that they should have been following in the first place. People want to avoid confrontation, so many managers never tell an employee that they are doing something wrong until finally it gets so bad they decide they need to fire the employee. Unions enforce discipline structures that force managers to do a better job, meaning less turnover. Seniority isn't always the best method, but an employee with lots of experience has institutional knowledge that can help the company, something that managers regularly under-value. It used to be standard practice for companies to pay for their employees to get specialized training that would improve the company. But as unions disappear, companies are disincentivized to invest in employees who may take that new training and market it to other companies to chase higher wages. The more freedom in the market, the less employers are incentivized to invest in employees if they won't be the ones to realize the gain, and the more employees are incentivized to maximize wages by leaving.
In my experience, the employees who play this game the best are those who don't have a sense of loyalty and usually don't have families. They are great talkers, able to sound brilliant in an interview, but that doesn't mean they are great workers. Their selfish behavior tends to cause resentment among the rest of the group, which hurts unit cohesion.
Another benefit to unions is that it's like having a lawyer on retainer. There are plenty of rules that businesses don't follow because they know that most workers don't understand the law well enough to fight back. No one is arguing that it is inefficient for rich people to keep lawyers on retainer, or that it's inefficient to have police enforcing the law. Of course, it is absolutely inefficient to need lawyers and cops, but their presence is necessary and we are better off with them than without them.
It's also just not a great system for those of us who have families. If I want to chase higher wages, I need to be willing to have my spouse quit her job, uproot my kids from their school in the middle of the school year, and leave any existing community support (grandparents, church, etc). It's that, or accept whatever wages my manager is willing to pay. Unions allow me to work for a single employer, knowing that my future in that company is fairly secure and that I can make investments in my community. Efficiency isn't always the most important thing.
I absolutely agree with you that unions can be terrible sometimes, but by the same token there are many terrible governments, but that's not a great argument for anarchy. I am certainly concerned about public unions, and very concerned about the lack of modernization at ports. But I would argue for specific reforms in these instances, not necessarily for the abolishment of all unions. You've spent a lot of time arguing that immigration is good, but I've never heard you actually advocate for open borders or a UAE style worker visa program. I assume the reason is that either you acknowledge that too much could at some point be bad or that it's simply politically unrealistic. In the same way, any political movement that only seeks efficiency and leaves wages up to pure market forces could never keep political power.
I'm open to the idea that you might replace most of the function of unions with regulations, minimum wage laws, and a fed policy that tries to prioritize maximum employment, but I fail to be convinced that workers are better off in a world without any outside intervention in the economy.
The structure and dynamics of unions and group health insurance are essentially the same. Like subprime loans packaged alongside high credit borrowers, regulatory frameworks synthesize a product that is the result of a distribution (no necessarily “bell-shaped”) between low performing and high-performing individuals. Nowhere is the more readily experienced than the public school teachers unions. And while philosophical arguments can be made around the distribution of teachers mirroring society itself, that private industry is being forced to purchase a synthetic product from an otherwise unbounded free market is indefensible unless we agree that under performing workers also deserve the same jobs as their higher performing peers. I think very few people would be willing to support that aGlenda out loud, never mind what #hashtags they use on social media and on their bumper sticker.
> The thing about taxing money and redistributing it is that, if a market transaction is welfare enhancing enough, it will still get done. But if you ban a certain kind of transaction, there is potentially no upper limit to how much economic damage you might cause. Take the example of whether to allow Uber to operate within a jurisdiction. It doesn’t matter how useful people might find the service or what they would be willing to pay; if government decides to ban the app, there is nothing one can do.
This makes the somewhat bewildering assumption that black markets not only don't exist, but can't exist.
I sometimes wonder if there wouldn’t be a place for a union that has values consistent with the shareholders. It could help overcome the agency problem between management and shareholders. We’ve all seen managers who were bumbling at best and malicious at worst. Some external association that just weighs in on employee discipline, and not on things like wages, might actually get the nod from executive management.
On ports: the busiest container port in the UK is in Felixstowe, a random small town whose one distinguishing feature is that, when containerization became a thing in the 60s, it was the only British port too small to have a union (every port that did have a union blocked the use of containerization, partly because they were worried about the impact on jobs and partly because it's a lot harder to steal a bottle of whiskey from the cargo when it's in a container).
On seniority precedent: a non-meritocracy related type of damage is that it just makes job allocation harder. For example, in the NYC subway, conductors get to pick their lines by seniority, which means junior conductors often have to keep switching routes, often to ones that start a two hour commute away.
From what I can tell, Felixstowe was the 7th busiest port in the UK by tonnage in 2022.
https://www.gov.uk/government/statistics/port-freight-annual-statistics-2022/port-freight-annual-statistics-2022-overview-of-port-freight-statistics-and-useful-information
Thanks. I got the stat from The Box (the container shipping book), but makes sense that it's evened out a bit since then now that every port does container shipping (also plausibly the book was exaggerating even for the time, although it's generally pretty good about accuracy).
Without that seniority practice in place all the workers would find themselves being switched on routes and management playing favorites. Nepotism comes into play.
You could imagine a policy where people are consistently preferred for routes they live closer to (like what every other transportation system does).
Like the airlines? 98% of pilots belong to a union.
I don't know how airlines do it, but since they're private sector I assume it's not quite as badly handled (for the reasons mentioned in the later part of the post).
My first exposure to unions was before I worked in online marketing, I had an English Education degree and had to complete an internship by teaching for a semester. We had to sign up for the NEA even when in college, I'm sure to funnel them more money and bolster their numbers - while getting us in the habit of mindlessly supporting them before having real world professional experience.
When I was teaching and interacting with other teachers, the topic of unions came up from time to time. It was a clearly parasitic relationship, the idea being that we were looking out for ourselves against society, namely the parents and government. It was funny hearing leftists online suggest that this was an entirely pro-social arrangement given that actual union members were much more realistic and grounded about the entreprise.
You missed the boat so completely as to call into question what you think a Libertarian is. Labor unions are a free association. No real libertarian would ever want to ban individuals from forming and joining such an organization, as it would limit freedom (the entire point of libertarians is to increase freedom). Furthermore, the increase in cost is a feature, not a bug. Your example of the longshoremen earning a living wage in an expensive place is an example of labor unions working. Importers are free to use alternative ports. Mexico is right there, free of longshoremen. We would see many imports choosing that option if the microscopic impact of longshoremen's wages were in any way significant (they are not).
The entire point of unions is to meet at eye level large corporations that have an unequal ability to suppress wages, especially in small towns where alternative employment is rare. Furthermore, workers favor many expensive, pareto suboptimal career benefits such as employing workers after they are no longer in the prime of their lives. This pushes employers to avoid practices that wear down the bodies of their employees. The policies of layoffs and rehiring is also one that employers love and employees hate. Higher labor costs are worth the lower volatility once an individual is hired. Such policies will be managed one way or another, and labor unions negotiating in a market is superior to the regulatory alternative.
Remember, unions only arose in opposition to market failures in employment, workers compensation and dangerous workplace practices. Unions allowed for private sector corrections without excessive government intervention. The alternative means MORE regulations, a larger, stronger OSHA, and likely a set of rules so cumbersome as to make new company formation rare. We need less regulation and more unions, not the alternative that has restrained our economy for the last fifty years (declining unions with ever increasing regulation).
As with all things, labor unions have a cost. It is a cost their members CHOOSE to bear and benefit from. There are externalities, of course, as all actors in an economy have. This is a fact of life. There are real reasons to oppose unions for public sector workers. That makes sense given the absence of an opposing shareholder (public sector managers have no profit to manage, and no incentives to keep costs down). There is no reason why private sector workers should not have the right to organize and demand a larger share of value added. If this imposes costs on others, so be it. If the cost is too high, the companies they work at will fail. The system works. Private sector workers should enjoy their right to organize, and have the ability to opt out. I would agree with you that workers should have that ability to say no. Requirements that all employees must pay for all union services are wrong. Workers should at the least be able to opt out of political expenditures. Public sector employees should have the right to opt out of all union dues, and frankly should not exist at all, but given the relentless persecution of unions along with the senseless attacks on work in general, this has never been a realistic goal.
The alternatives to the mass unionization the US had in the 1950's and 1960's is mass government regulation and the dumping of corporate externalities on the public. This has been right in line with high taxes on earned income and foolishly low taxes on capital gains. We would be better off eliminating such distinctions and having the same rates on all income of any kind, ideally with an end to corporate taxation (only taxing income distributed to shareholders).
Thanks for the interesting comment, Garry. Hope you don’t mind if I offer my perspective…
“Labor unions are a free association.”
Libertarians and classical liberals would indeed praise free association. What they (and you below) reject are unions which force employees and prospective employees to join against their will and force employers to bargain with the resulting cartel rather than other free alternatives. A closed shop union effectively uses government force to mandate that an employer bargains with a labor monopoly.
“the increase in cost is a feature, not a bug.”
The cost increases of wages is a bug if it costs more than is gained with productivity. The term for this is “rent seeking,” and it makes a market less competitive and efficient as RH has already clearly explained.
“The entire point of unions is to meet at eye level large corporations that have an unequal ability to suppress wages, especially in small towns where alternative employment is rare.”
Large firms in free markets have in fact been unable to suppress wages. Every large employer (all non union) I ever worked for constantly increased wages and benefits both over time on average, and specifically for me and the countless other employees who gained value through experience and promotions. Our productivity (or marginal productivity) increased and so did our wages. But I can see the hypothetical value of voluntary unions in small towns.
“This pushes employers to avoid practices that wear down the bodies of their employees. The policies of layoffs and rehiring is also one that employers love and employees hate. Higher labor costs are worth the lower volatility once an individual is hired. Such policies will be managed one way or another, and labor unions negotiating in a market is superior to the regulatory alternative.”
But there is another alternative. The alternative is that employers compete for employees and they do so not just with wages, but also with benefits, working conditions, reputation, and so on. Unions can supplement competition in some places and conditions, but in many cases (such as government and closed shops) they can also make the competitive forces less effective.
“…unions only arose in opposition to market failures in employment, workers compensation and dangerous workplace practices.”
I disagree. Cartels, guilds, monopolies and rent seeking arise anywhere they can arise, and then they rationalize and justify their parasitic nature with arguments that seem plausible.
“Private sector workers should enjoy their right to organize, and have the ability to opt out.”
Agreed.
“The alternatives to the mass unionization the US had in the 1950's and 1960's is mass government regulation and the dumping of corporate externalities on the public.”
If true, this might be a decent argument. What proof can you offer that it is true?
Excellent article. I agree that labor unions are a very poor means to promote the interests of the working class and poor.
Regarding “ History backs up the idea that redistribution is better than trying to micromanage millions of individual decisions.”
This is absolutely true, but history also shows that long-term economic growth does far more than redistribution.
https://frompovertytoprogress.substack.com/p/evidence-for-progress-global-poverty
I would also add that our welfare state spends trillions per year and does not do a very good job of helping the poor and working class.
I wish the Right talked far more about how we can reform the American welfare state to produce better results with less spending, but they are typically dead silent. I have a few ideas of how we can do this:
https://frompovertytoprogress.substack.com/p/the-case-for-a-working-family-tax
https://frompovertytoprogress.substack.com/p/the-case-for-upward-bound-accounts
https://frompovertytoprogress.substack.com/p/we-should-phase-out-most-means-tested
But again, economic growth should come first.
Just as with the previous article, doesn't all this also apply (mutatis mutandis) to physicians, lawyers, accountants, academics, etc.: the gentrified unions that are known as “professions”? If not, why not?
Yes. Why is this even a question? I didn’t make the argument for every single profession. Those professions are in even worse shape because of credentialism.
Addling the professions would be a good update to your article/s.
It was only a question because the professions were not mentioned. Thank you for that clarification.
Because the distinction is frequently omitted intentionally, as you were noting above about Yglesias and unions. Healthcare is about 18% of Americas gdp and that's going to increase.
And for every complaint you posted about union guys refusing to do X, there's a dozen examples in healthcare.
Credentials restrict the supply of entrants to a profession, but they don't go on strike together, crafting collective contracts that bind what their clients can do.
It’s true that they don’t go on strike, but it’s untrue that they don’t effectively create contracts that bind what their clients can do. Take the realtors, as an obvious example. And lawyers have all sorts of rule that limit competition, competing on price, etc.
I had not heard that lawyers had rules against competing on price.
restrictions on how they can *advertise* their prices, which is close to the same thing, making it much more difficult to compete on price.
Restrictions on advertising prices are different from restrictions on prices themselves. People with less money can still get legal representation, it's just harder to know whether it's a good deal.
Zero argument. But it is still a way that the legal profession credentialists limit the competitive market, to the advantage of the credentialed and the detriment of consumers. Which was the original point in this thread.
In the UK the doctors working for the NHS do sometimes go on strike together.
It’s very hard to convince lefties that you, in fact, cannot directly reallocate corporate profits to workers and consumers.
The one point imo you failed to make explicitly is that public sector unions are worse than private sector unions precisely because they get involved with politics.
There is nothing at all inherently wrong with private sector unions (so long as there is free association, rather than must-join laws) getting involved in politics, but it is wrong that *public* sector unions can participate in politics, as they are picking the people on the opposite side of the bargaining table.
FDR - perhaps the ultimate leftist icon - understood this, and said so.
Private sector unions get involved in politics as well, but they aren't on both sides of the negotiating table (unless you count other countries where labor unions elect members of corporate boards, but that's separate from electoral politics).
Exactly. Which is why it’s ok that private unions get involved in politics, but not ok for public unions to do so.
[I ain’t a big supporter of private unions, for most of the reasons Richard notes. But public sector unions are imo wrong for reasons that are beyond what Richard covered. I can perhaps make a partial exception for police unions - e.g. to protect officers from politicians wanting to score political points, and also since cops can’t strike - so long as they don’t get involved in electoral politics at all. But even they probably have too much power. But allowing unionization for ordinary government workers is ridiculous, yet it remains because of the huge political benefits for leftists.]
Another aspect of unions is that the contracts they achieve set a standard for all working conditions and compensation. All workers have the option of unionizing and employers know that. You can't suppose that what non union workers get is a non union result and then suppose it's a demonstration that not being unionized is ok.
He addressed that argument. Improvements in wages, hours, and working conditions predate unions. And in fact began when unions were affirmatively unlawful.
I agree, but in fairness nelson’s argument is one of the few legit leftist arguments for private sector unions, especially in the short run.
NOT suggesting that it shifts the balance of logic for the issue overall, of course.
My understanding is that Scandinavian countries tend to have large labor unions that cover a significant percentage of the workforce, and are thus invested in overall economic growth. The UK traditionally had much smaller craft unions with narrow interests who would be willing to go on strike and disrupt other sectors of the economy.
Fascism remains undefeated as the smartest realistic economic model, as long as you can shed the rightoid baggage.
What are you talking about? The "Spanish miracle" occurred when Franco got rid of the Falangists in his government who'd been doing a poor job of managing the economy and replaced them with Opus Dei members.
I was responding to your point about Scandinavian Unions. The idea of having large unions that are effectively just arms of the state and take the general interest into account is originally a fascist idea.
Libertarianism is superior as an economic system to fascism, but there is no incentive for an elite to support it, and it also has no popular support. It doesn't even qualify as an unstable system, because you can't set it up in the first place.
I think Scandinavian social democracy can have some things in common with fascism without being the same as fascism. And of course they had to enact neoliberal reforms when social democracies started faltering in the 70s.
Iceland appears to have had libertarian anarchism in its past.
The unions i have belonged to have only enhanced my economic freedom.
Every recipient of economic rents enjoys those rents. Most convince themselves they deserve them.
The idea that modern labor practices could have come about naturally as the country became wealthier defies basic logic. Getting those practices changed took massive amounts of effort and collaboration between huge numbers of people who had to create organizations from scratch. You don't go to that effort unless something bad is happening for a long time. Individual catastrophes like the Triangle Shirt Factory fire supercharged these movements, but the problems that needed to be solved had existed for decades without the market changing its labor practices. Instead, the labor practices changed, and companies that adopted unions continued to grow.
"The Nordic social democracies are wealthy" -The Nordic social democracies have a system where unions are required across an entire industry, a pretty great idea because if only McDonalds gets a union, they will be at a competitive disadvantage compared to other fast food companies. So I agree with you that adopting their policies would be a good idea.
"During covid, the US was an outlier in terms of masking and school closures. Teachers unions were the primary reason for this." -Except that most all those other countries also have teacher unions.
Wages are different than prices, competition in the market doesn't function the same way. The difference between having a low wage job and a high wage job is less than the difference between having a low wage job and no job at all. If the price of eggs goes up you can eat something else for breakfast, being unemployed for even a short period of time can be ruinous. Adding to that is the fact that no one knows what a competitive wage is because employers can hide wages, which suppresses competition. Just getting to know the possible wage at a single company could take months and multiple interviews. Imagine having to shop for groceries but each store only has a couple products and they won't agree to tell you even a ballpark price until you go through an interview process and tentatively commit to buying. Unions make wages public, and tilt the market to give slightly more bargaining power to workers.
"Even without unions, businesses have an interest in keeping their workers happy."
Only someone who has not spent much time working in private industry could say that with a straight face. I agree that in theory it would make sense for employers to keep their workers happy, but typically in practice they don't. Managers regularly undervalue existing employees and will hire less qualified workers at higher wages. This is the main reason you can radically improve wages by changing jobs frequently. If you want to maximize wages you need to extract value from the business by using them to accumulate experience and skills, then market those skills to employers who haven't had to invest yet. No one wants to hire someone without industry experience, but if you get your foot in the door at one job, the world is your oyster. Turnover is extremely costly for businesses, but they rarely focus on it because it's a hidden cost and managing people is difficult.
I had personal experience with this. Working at a power plant is a job that requires years of training just to be halfway good at. Even if a person has experience on similar systems, it still takes months of training on our specific systems for them to be anything but a drag and years to be proficient enough to operate independently. Despite this, our manager would actively make everyone as miserable as possible, refuse wage increases for people with seniority, and hire people with less experience at higher wages. When I was first hired there was very little turnover. By the time I was miserable enough to leave, there was only one operator left with more than 5 years of experience. That lack of experience costs the company money, but they probably won't notice because it's difficult to attribute any single incident to inexperience.
There are many benefits to unions that you don't realize. Unions can make up for bad managers because managers are forced to follow rules that they should have been following in the first place. People want to avoid confrontation, so many managers never tell an employee that they are doing something wrong until finally it gets so bad they decide they need to fire the employee. Unions enforce discipline structures that force managers to do a better job, meaning less turnover. Seniority isn't always the best method, but an employee with lots of experience has institutional knowledge that can help the company, something that managers regularly under-value. It used to be standard practice for companies to pay for their employees to get specialized training that would improve the company. But as unions disappear, companies are disincentivized to invest in employees who may take that new training and market it to other companies to chase higher wages. The more freedom in the market, the less employers are incentivized to invest in employees if they won't be the ones to realize the gain, and the more employees are incentivized to maximize wages by leaving.
In my experience, the employees who play this game the best are those who don't have a sense of loyalty and usually don't have families. They are great talkers, able to sound brilliant in an interview, but that doesn't mean they are great workers. Their selfish behavior tends to cause resentment among the rest of the group, which hurts unit cohesion.
Another benefit to unions is that it's like having a lawyer on retainer. There are plenty of rules that businesses don't follow because they know that most workers don't understand the law well enough to fight back. No one is arguing that it is inefficient for rich people to keep lawyers on retainer, or that it's inefficient to have police enforcing the law. Of course, it is absolutely inefficient to need lawyers and cops, but their presence is necessary and we are better off with them than without them.
It's also just not a great system for those of us who have families. If I want to chase higher wages, I need to be willing to have my spouse quit her job, uproot my kids from their school in the middle of the school year, and leave any existing community support (grandparents, church, etc). It's that, or accept whatever wages my manager is willing to pay. Unions allow me to work for a single employer, knowing that my future in that company is fairly secure and that I can make investments in my community. Efficiency isn't always the most important thing.
I absolutely agree with you that unions can be terrible sometimes, but by the same token there are many terrible governments, but that's not a great argument for anarchy. I am certainly concerned about public unions, and very concerned about the lack of modernization at ports. But I would argue for specific reforms in these instances, not necessarily for the abolishment of all unions. You've spent a lot of time arguing that immigration is good, but I've never heard you actually advocate for open borders or a UAE style worker visa program. I assume the reason is that either you acknowledge that too much could at some point be bad or that it's simply politically unrealistic. In the same way, any political movement that only seeks efficiency and leaves wages up to pure market forces could never keep political power.
I'm open to the idea that you might replace most of the function of unions with regulations, minimum wage laws, and a fed policy that tries to prioritize maximum employment, but I fail to be convinced that workers are better off in a world without any outside intervention in the economy.
The Lakeside Press story is pro-union; if the owners weren’t worried about unionization, they wouldn’t have bothered with any of that.
The structure and dynamics of unions and group health insurance are essentially the same. Like subprime loans packaged alongside high credit borrowers, regulatory frameworks synthesize a product that is the result of a distribution (no necessarily “bell-shaped”) between low performing and high-performing individuals. Nowhere is the more readily experienced than the public school teachers unions. And while philosophical arguments can be made around the distribution of teachers mirroring society itself, that private industry is being forced to purchase a synthetic product from an otherwise unbounded free market is indefensible unless we agree that under performing workers also deserve the same jobs as their higher performing peers. I think very few people would be willing to support that aGlenda out loud, never mind what #hashtags they use on social media and on their bumper sticker.
Is there part 3 yet?
> The thing about taxing money and redistributing it is that, if a market transaction is welfare enhancing enough, it will still get done. But if you ban a certain kind of transaction, there is potentially no upper limit to how much economic damage you might cause. Take the example of whether to allow Uber to operate within a jurisdiction. It doesn’t matter how useful people might find the service or what they would be willing to pay; if government decides to ban the app, there is nothing one can do.
This makes the somewhat bewildering assumption that black markets not only don't exist, but can't exist.
I sometimes wonder if there wouldn’t be a place for a union that has values consistent with the shareholders. It could help overcome the agency problem between management and shareholders. We’ve all seen managers who were bumbling at best and malicious at worst. Some external association that just weighs in on employee discipline, and not on things like wages, might actually get the nod from executive management.