Union Discussion (2)

Friends,

Continuing my discussion about unions, one big question I have is why is there so much federal and state legislation favoring unions? In fact why is there any legislation about unions at all? I have thought about it at some length and am still having trouble understanding why unions would need to be federally protected. Are they so insecure about their own mission and goals that they have to have legal cover?

Now I’m going to jump right in and show my naiveté. Why can’t the unions go head to head with management for the loyalty of the workers? Decades ago industry learned that one aspect of profitability is maintaining a contented workforce. Unions understand this as well and have determined that the only way to maintain membership is to continue to foment dissatisfaction. The unions have to maintain that dissatisfaction to ensure member loyalty. That is one reason unions fight so hard against Right-to-Work laws which say that a worker is free to decide whether or not to join the union. If a worker has a choice to join a union that will routinely use members’ dues to support candidates and issues that are against the member’s wishes and/or beliefs, why join?

At this time only 22 states have Right-to-Work laws. The unions have worked hard to repeal these laws. The unions understand that these laws effectively interrupt their income flow because when given an option, workers are likely to reject membership. Unions’ effectiveness has diminished over the years and they have become self-serving entities.
The immediately past election season saw an unprecedented level of spending by the unions on various races including the race to defeat the Right-to-Work amendment on the ballot in Colorado. Their campaign was based on scare tactics and had the solid backing of the Colorado Governor, Bill Ritter. Governor Ritter was dutifully fulfilling his obligation for their support. Not only did he offer moral support to the defeat of Amendment 47, he instituted early in his tenure as governor an executive order to deduct union dues from state employees. This prompted another amendment initiative, Amendment 49 to limit payroll deductions for public employees. Both of these amendments were defeated with the massive assistance of union PACs. Here is another example of the unions afraid to give the workers and the public a choice.

This is an appropriate place to point out the different economic conditions between union and Right-to-Work states. I previously referenced an article from the 3 March 08 online issue of the Wall Street Journal (http://online.wsj.com/public/article_print/SB120450306595906431.html) which pointed out the economic differences between union and Right-to-Work states using Texas and Ohio as illustrations. Ohio is a union state; Texas is a Right-to-Work state. As of the writing of the Wall Street Journal article, Ohio had lost 200,000 manufacturing jobs since the turn of the 2000. Texas, by contrast, had almost twice the new job creation rate than the rest of the US, gaining 36,000 new manufacturing jobs just since 2004.

The article showed that foreclosures in Ohio have soared. In 2007, Ohio had the fourth highest home foreclosure rate in the nation at 3.45%. Statistics for Texas for 2007 could not be readily found, but that state is on track for a foreclosure rate for 2008 of 0.55%.

Let’s look at some of the reasons for home foreclosures. Conventional wisdom would say that homes go through foreclosure because the owner/mortgagee cannot make the payments. In normal times when people are employed and earning a steady paycheck, they will pay their mortgage first and purchase other basic needs with what is left. However, when they lose their jobs and the available money is drastically reduced or eliminated what is the first thing they will pay for? Since the mortgage is normally only paid once per month, available money will go to food and other basic needs because they can put off the mortgage for a little while but have to have food and gas. Soon, they are in over their heads and facing foreclosure.

Note: Foreclosure rate is only one indicator of economic robustness. Ohio has one of the highest business tax rates in the country, further driving businesses, and thus, economic activity out of the state.

Look at the differences between Ohio and Texas. Business-friendly Texas is acquiring the manufacturing facilities that have been leaving Ohio. The result is that union jobs in Ohio are not being replaced and those jobs are going to Texas where the workers do not have to join the union. The unions have materially participated in establishing an unfriendly business atmosphere in Ohio but that has not occurred in Texas. These examples are not isolated; they are fairly represented across the union/non-union spectrum.

Unions’ intrusion into the body of laws is even more blatantly evident in the Employee Free Choice Act that was passed by the House last session but defeated due to a filibuster by Republicans in the Senate. This misnamed act would take away the right of union members to exercise their constitutional right to secret ballot in union elections. The unions say that secret ballots give employers the opportunity to pressure employees to reject unions. This argument shows just how perverted the logic of unions is. If you take away the secret ballot, the workers are open to union intimidation, which can be considerable to the extreme.

I think the case can be fairly made that strong union presence in a state’s body of laws is a definite detriment to that state’s economy, not to mention the freedom of the workers. Here in Colorado we lost two important opportunities to curb union activity in our state. In order to get our state back on the track of a robust economy, it is imperative that the union influence in our legislative process be curbed. The same can be said for union participation in the federal legislative process. The millions of dollars that the unions poured into state and federal campaigns have and will have huge consequences in the near future.

The bailouts which I referenced in my last posting are a reality. The effect will be to continue to bolster massive union programs to the detriment of the workers. Meanwhile, union states will continue to lose jobs to non-union states and off-shore manufacturers. I believe that it is imperative that laws giving preferential treatment to unions be stricken from the books.

As always, I welcome your comments/discussion.

Dan