If you trusted only what you’ve been reading in the news lately, you would imagine that big labor in the United States has lifted off into a resurgence of historic proportions. The United Auto Workers (UAW), with a long history of friendliness toward socialism, struck its way to a lavish deal with the Big Three automakers, and in the wake of the contracts, the UAW motto seems to be: “Today Detroit, tomorrow the right-to-work workforce.”
In Tennessee, which, like the rest of the South, has a right-to-work law protecting employees from being forced to join a union or pay the equivalent of union dues, some 1,000-plus employees of Volkswagen’s Chattanooga factory signed to put in motion a balloting of workers on unionization by the UAW, with the union’s eye on organizing at more than a dozen foreign-owned auto manufacturing factories within right-to-work states. The filing of such union election petitions is up substantially in recent years, possibly a reaction to the devastation that the lockdowns inflicted on the economy. Plus big labor boasts successful unionizing efforts of Amazon and Starbucks employees last year.
Unionization looks good on paper. How can workers oppose forcing their employer to give them higher wages and leveling pay across auto plants so that collective bargaining can have the advantage of a relatively homogeneous workforce—i.e., united power against your boss? How can they be against making it harder for a foreman to fire or punish the workers under him? And how can they say no to the chance for bigger pensions and lots of fringe benefits?
And yet polling finds “sounds good, no thanks” to be a widespread attitude toward union membership. Approximately 1 of every 6 Americans live in a household with one or more union members, according to Gallup polling last year. Fewer than half of those in unions said their membership is “extremely important.”
Gallup this year found that 67 percent of Americans approve of labor unions, down from a historical high of 71 percent last year, the peak of an upward trend beginning in the aftermath of the financial crisis of 2008–09; it had hit a floor of 48 percent back then. And yet Gallup also found that 58 percent of nonunion members were “not interested at all” in joining a union.
The right-to-work movement has been driven by the question, “If unions are so great, why do you have to force people to join one or make them pay the equivalent of dues if their choice is to not join, as a condition to get some jobs?”
A similar question could be asked of Americans who think unions are doing good but adamantly don’t want to be on the receiving end of such “good” when it comes to their own job.
A private sector job is a contract between a business and a worker. When you take a position, you may not think it’s your dream job, but you probably believe it to be acceptable. And employer and employee alike are free to sever that working relationship if it doesn’t work out, based on the contract’s terms and the law. The online recruitment company Zippia found that 65 percent of American workers to be happy with their jobs but only 20 percent to be passionate about them.
The comparison when it came to job satisfaction between remote workers and in-office employees was 57 percent versus 50 percent—which suggests that the wishes of workers are in line with the economy’s changing toward more computer-assisted employment, which makes physical location less and less relevant. Where big labor is going to fit in a world in which bosses find flexibility for their employees to be in their own interests is uncertain at best.
Fifteen years ago, General Motors was losing tens of billions of dollars while paying out labor costs about 45 percent above those of its foreign-owned competitors. The exorbitant salaries, lifelong pensions, and trimmings, such as getting paid close to full salary during temporary pauses in work, unquestionably helped cause GM’s bankruptcy and federal bailout. It’s astonishing to consider that providing employees with a 401(k), a means of accruing personal wealth that tens of millions of Americans in the private sector have used to build hefty retirement nest eggs, was considered by the UAW to be a concession to ownership at the time, so outlandish is the big labor mindset.
Without a federal bailout approaching $50 billion in the wake of the financial crisis, GM, which had already been in big trouble, would be long dead today. Even after the government-run automaker recompensed Washington, taxpayers ended up on the hook for more than $11 billion of those rescue funds.
Just as socialism has no place for the market’s financial rewards for individuals distinguishing themselves through achievement, workers are homogenized in the union workplace.
As Manhattan Institute senior fellow Allison Schrager recently pointed out, “Unions work by compressing wages (and often the terms of advancement) in negotiations on behalf of all employees. This means very productive workers are paid almost the same as unproductive workers. ... But today’s economy pays higher returns to exceptionally productive workers, and technology gives employers the ability to learn which employees are more productive.”
When the workforce is a collectivized blob in a perpetual state of war with management, rewarding individual merit is impossible. How could it be otherwise when an ideology that abhors individual merit in the economy at large is in ascendance?
In the early postwar era, Americans couldn’t buy an automobile that wasn’t manufactured by UAW members. By taking full advantage of that lack of competition over the following decades, the powerful union opened the door to foreign competitors who took advantage of the demand for alternatives to the unwieldy, gas-guzzling dinosaurs being offered by Detroit. One of the direct results is that today, only about 14 percent of American auto workers are unionized, with foreign-owned car brands providing livelihoods for more workers in this country than the domestic Big Three do.
The UAW won’t succeed in expanding the recklessness that crashed the U.S. auto industry as long as the truth is known by the nonunion workers they want to run over: Their jobs exist because the people signing their paychecks took an exit off the road to ruin.