There is power in a union -- but to do what?
In a Times op-ed today, former Labor Secretary Robert Reich wrote a mash note to the labor movement, saying unions could help reverse the current recession. They would do so not by increasing productivity, innovation or consumer confidence, Reich argued, but by extracting more pay from employers and increasing the purchasing power of the middle class.
I'll leave others to dispute the notion that average earners haven't done well this decade -- the median income fell slightly in comparison to inflation between the peak of the dot-com boom and 2007, according to this New York Times chart, and that was before the recession began. It wouldn't take much to persuade me that we'd see a narrower pay gap between CEOs and worker bees if more of the latter were unionized. Nevertheless, the roots of the current problem lie in the housing market's implosion, not in the routine ups and downs of the typical business cycle. If the median income were higher, would that have prevented housing prices from rising insanely and then collapsing? Or would it have simply made the speculation and risk-taking even crazier? Bear in mind that when the bubble burst, it also caused havoc in much more heavily unionized parts of the world, such as Europe....
One other point that Reich makes today is that a 2006 poll suggested that "a majority of workers would like to have a union to bargain for better wages, benefits and working conditions." Sounds nice, but as we've seen recently with the Screen Actors Guild and the UAW, the reality of collective bargaining is a bit more complex than that.
Infighting over negotiating tactics split actors into two separate bargaining units (SAG and AFTRA), and now it's tearing SAG apart. The moderates who recently claimed a majority of SAG's board seats filed the paperwork today to fire SAG's chief negotiator, Doug Allen. And to think just yesterday SAG was staging its annual self-love-fest.... The unusual move may not bear fruit any time soon, however, says attorney Jonathan Handel, who's been tracking Hollywood's labor talks. That's because of a hard-line faction within the guild that strongly supports Allen. The SAG experience serves as a reminder that unions develop identities distinct from their membership, and sharp disagreements can emerge between members and their leaders, or among the rank and file.
The UAW, meanwhile, shows that strong and effective advocacy on behalf of workers can sometimes push an employer into a hole that threatens its survival. I don't blame the UAW for seeking contracts that kept workers on the payroll even when their plants closed (i.e., the infamous "jobs bank"), or that gave workers and retirees the kind of health benefits and pensions that most of us can only dream about. No, I blame leaders of Chrysler, GM and Ford for recognizing too late that their shrinking market shares wouldn't let them support such obligations. The UAW conceded much in the last round of contract negotiations, but the changes may have come too late to save Detroit.
I point out the SAG and UAW experiences just as cautionary tales, not typical examples. I think unions are good things, and was happy to be a member of the Communications Workers of America when I was at the San Jose Mercury News. But too often, advocates of unions present them as cure-alls that can immunize workers against business cycles and (in Reich's case) even save us from asset-driven mania. They're not and they can't. Just look at my former employer -- the CWA couldn't stop Knight Ridder from imploding and selling the Merc to Dean Singleton, a local-news empire builder who's seemingly hell-bent on laying off more journalists than anyone in history.
Illustration by the Los Angeles Times