Notes From Babel

Archive for the ‘Unions’ Category

The Labor Movement, Redistributive Justice, and Procedural Fairness

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The left’s alignment with unions is more than merely political—it is ideological.  The major justification for continued existence of unions, particularly public sector unions, borrows heavily from a liberal conception of redistributive justice, as follows:

  • As a matter of first principles, all Americans are entitled to a minimum standard of living.
  • As a matter of observed fact, impersonal market forces sometimes do not result in compensation that comports with that preconceived standard of living.
  • Therefore, the market is an unsatisfactory mechanism for assigning economic values to labor.

I do not hide my antipathy for this line of reasoning, but I will not assail it here.  I want to instead press upon participants in the debate over organized labor, and particularly over public sector unions, of the impossibility of meaningful progress in that debate without acknowledging the standoff between conservative and liberal first principles.  More specifically, I contend that the labor movement will fail to win many converts because it either cannot or will not approach the issues as most Americans do:  by focusing on procedural fairness, rather than substantive outcomes.  While many people might believe they should earn more money, for example, they eschew procedurally unfair mechanisms to achieve it.  The abuse of procedural mechanisms, however, is precisely the criticism lodged against public sector unions.

As I discussed at length in a previous post, public sector unions present, at a minimum, the following forms of procedural unfairness:

  • Striking in the public sector exerts political rather than economic pressure on the government (who continues to collect taxes regardless), and is thus designed to harm the members of the public, particularly the poor, who depend on government services that unions are contracted to provide.
  • The employer with whom public employee unions negotiate—the government—is not just another industry, and thus normal market constraints are often supplanted by political restraints and more flexible accounting practices that enable unfair and unrealistic concessions in favor of unions.
  • Using their substantial political clout, public employee unions are able to influence elections and thus exert control over the representatives with whom they negotiate, resulting in less-than-arms’-length negotiations.
  • Accordingly, public employee unions are able to negotiate deals that often violate state constitutional proscriptions against retroactive compensation and incurring liabilities without voter approval.
  • Public employee unions represent one of the most powerful special interest groups by, in part, having successfully lobbied for laws requiring union dues be automatically collected from their members.
  • Public employee unions lobby against laws, such as Right to Work, that prohibit coercive and anti-competitive practices.
  • Public employee unions, unlike the general public, are permitted to press their interests upon elected officials in closed-door negotiations.
  • All this substantial political influence wielded by public sector unions constitutes an improper delegation of the police power properly held in trust by elected officials for the protection of the health, safety, welfare, and morals of the public.

The dispute over public sector unions, then, is between mainstream Americans in the private sector who believe fairness is achieved with the guarantee of fair and adequate procedures, and union supporters who believe fairness can only be determined by looking to substantive outcomes.  For the first group, public sector unions are unfair because they are given and make resort to special procedures not available to other groups.  For the second group, these various procedural objections are unpersuasive so long as public employees receive adequate compensation according to conceptions of liberal redistributive justice.

The two groups hopelessly talk past each other, then, as they are each lobbying for disparate forms of justice.  As a matter of practical reality, the two conceptions of justice are mutually exclusive:  The guarantee of procedural fairness is precisely the guarantee of fixed procedures in order to achieve particularized outcomes based on individual merit.  The guarantee of substantive fairness is precisely the guarantee of particularized procedures in order to achieve fixed outcomes based on conceptions of a “human right” to membership in the Middle Class.

It should be obvious, then, that for advocates of procedural fairness, whether public employees are overcompensated is merely a derivative claim—the principal claim is procedural unfairness.  The disparity in substantive outcomes that results between public and private employees—despite their being otherwise similarly situated—is evidence of the fundamental procedural problem.  (Incidentally, the same basic argument runs with respect to wealthy financiers.  Mainstream Americans are not overly bothered by the notion that someone, somewhere, might be very rich.  They are bothered instead by the idea that they might have become rich because of unfair tax policies, unfair regulatory schemes, or outright fraud—all of which are examples of procedural unfairness.)

This is why liberals will not answer the questions about the basic unfairness of public sector unions—they have no interest in fixing the unions.  It’s the unions who’ve got the right idea, according to liberals:  fix the value of labor in the first event to meet a basic standard of living, and then work backwards to somehow make all the math work. Instead, liberals are interested in making the rest of the workplace look more like the public sector.

The strategy seems like it would be a slam-dunk:  who wouldn’t favor an approach that would increase their compensation?  Thus, the fact that as many Americans disfavor as favor public employee unions strikes liberals as evidence of a stupid or brainwashed population captured by powerful corporate interests.  I submit instead that liberals have to this point ignored Americans’ strong predisposition toward procedural fairness, and that, provided procedural fairness is reasonably assured, Americans are willing to accept disparate outcomes—the bugbear of liberal ideology.  This is the bitter pill that liberals are reluctant to swallow, and it is why they have not made meaningful progress in advancing the dialog on public sector unions or addressing their many systemic abuses.

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Cross-Posted at The League of Ordinary Gentlemen

Right to Work

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Here’s Tim Carney on Right to Work:

Right to Work laws bar employers from imposing a different sort of condition: the requirement that all employees join a union. Thus they take away property rights and infringe on the right of contract.

There are plenty of stupid labor laws that restrict employer freedom, but none of these laws force employers to have a closed shop. Preventing employers from agreeing to a closed shop is no free-market solution.

The suggestion that Right to Work is somehow anti-conservative or anti-freedom-of-contract is about the dumbest thing I read last week. The idea that employers would, on their own, require all employees to join a union seems obviously incorrect.  Right to Work prevents unions from urging employers to adopt these restrictive policies.  It’s not as if employers on their own came up with the idea to drastically limit their work force and prevent themselves from hiring bright, qualified, willing applicants, simply because they are non-union.

Instead, what’s going on here is unions leveraging their influence against employers to use employers’ freedom of contract in an anti-competitive fashion in the aid of unions.  Right to Work, then, deprives an employer of a right that is quite useless to him—i.e., the right to limit his hiring pool—because that right is too often used by unions to anti-competitive ends.  Thus, if employers no longer have the right to limit their work force, unions can’t urge them to do it.

There’s an analogue here in the eminent domain/redevelopment context, which I wrote a law review article about some years back. Eminent domain is an important governmental tool to the extent the public needs roads and schools and parks and other public works; but it is a dangerous tool when the law permits it to be used for mere economic development. Why? Because even if the government has beneficent ends (e.g., rooting out slumlords, revitalizing an impoverished area, etc.), many businesses don’t. Costco, for example, is well known for its tactics in leveraging its economic muscle against redevelopment agencies to use their power of eminent domain to make space for them. If they don’t? Costco will move down the street to the next town and draw lots of tax revenue from the first town.  In the case of 99 Cents Only Stores v. Lancaster Redevelopment Agency in 2001, Costco threatened to close up its store at the hub of a major shopping center, and leave it shuttered and unoccupied for the remainder of its lease if the city didn’t use eminent domain to take the 99 Cents store competing with Costco.  The city gave in, and agreed to take 99 Cents’ store and give it to Costco for $1.00.  Luckily, the court ruled against this illegal power play.

Redevelopment agencies’ “freedom” to take property for economic development, then, winds up being used against them.

Same with Right to Work.  There are all sorts of laws that prevent parties from “freely” contracting where the resulting contracts are anti-competitive. Typical are agreements in which an employee “freely” agrees not to compete with his employer after his term. But because this restrains his ability to practice his profession post-employment, such agreements are routinely struck down by courts.  The law tends to disfavor the sorts of contracts that are systematically used in the aid of subverting liberty more generally.

Agreements between unions and employers in which employers purport to bargain away their freedom to hire qualified, willing applicants, simply because they are not a union member, is just this sort of anti-competitive agreement.  An employer’s “freedom” to require employees to join a union is not one that benefits employers; it is one that unions leverage against them. Right to Work, then, is typical of laws that invalidate abusive, anti-competitive contracts in the cause of greater overall liberty.

Written by Tim Kowal

February 27, 2011 at 7:00 am