The budget-and-labor battle in Wisconsin has put the focus on union compensation and collective bargaining. Do unions have a right to bargain collectively, even public worker unions? Does collective bargaining for public sector unions result in these workers being overpaid and damage government budgets? Should we get rid of unions and collective bargaining, or preserve them?
I think the solution to this problem is not to get rid of unions or collective bargaining, but to have more unions.
That’s because the problem is not unions, per se, but monopolies. Bad things can happen if a corporation — let’s say, a car company — has a monopoly. If there’s only one company that sells cars, then it can jack up the price much higher than if it faced competition from other car companies. If you want to buy a car and they’re the only game in town, where else are you going to go?
That’s precisely the problem presented by many unions: they’ve become monopolies. But instead of being a corporate monopoly that sells cars, they’re monopolies that sell labor. They control it and parse it out in order to raise the price of it, just like a corporate monopoly does. In some places and industries (for instance, some public workers), all the labor is represented by one union. If employers want to buy labor — that is, hire employees — where else are they going to go? The union is the only game in town.
The thing is, we’ve already worked out a solution to the problem of corporate monopolies: break them up. Break them up and create more of them, smaller ones that aren’t monopolies. This is what happened to AT&T in 1982: after the government ruled it to be a monopoly, it was broken up into the “baby bells”. Not only that, corporations have to get government permission for mergers and acquisitions, to make sure monopolies aren’t formed in the first place.
Granted, this policy is controversial, as some people oppose government regulating corporations in this way. But for those who approve of “anti-trust” or “trust-busting” measures when it comes to corporations, why not apply them to unions as well? Actually, trust-busting legislation initially did cover unions, until later legislation exempted them.
But why should they be exempt? Certainly, breaking up unions is a violation of their freedom of association. But so is breaking up corporations. If it’s good for the goose, why isn’t it good for the gander?
And breaking up unions could have the same good consequences that arguably justify government intervention against corporate monopolies. Collective bargaining is only a problem if there’s a monopoly of one union. If there’s several of them, unions would have to compete against one another, offering lower wages in order to secure a labor contract from an employer. That would prevent “the only game in town” from harming consumers, employers, and government budgets.
If that’s too much to stomach, though, why not try the other direction? Let government take a “hands-off” stance to corporations, just like it does unions. This may not help much with public sector unions (they already bargain with a monopoly: government). But it would level the playing field if other labor monopolies (say, The International Alliance of Theatrical Stage Employees) had to negotiate with corporate monopolies.
One way or another, the situation should be equalized. If price-fixing and colluding is OK for labor cartels, then why isn’t it also OK for corporations? Why can’t every industry be run like OPEC? If public sector unions can bargain collectively, then why can’t government contractors? Why not let them engage in some collusion to protect their interests and the rights of their members? “Hey, let’s all agree, nobody puts in a bid lower than $10 million for this construction work.”
Of course, that kind of collusion might wind up being more self-serving than rights-protecting, so maybe corporations shouldn’t be allowed to do that.
But if it’s not OK for corporations to behave that way, it shouldn’t be OK for unions to do it, either.