Wednesday, November 26, 2008

Farewell, sweet unions

My previous post about the "above-market wages" of auto workers brought something else to mind. I've written before about the false wonders of privatization, the idea that companies bring inevitable efficiency to whatever they touch, efficiency that simply cannot be provided by government. I laid out that argument is some detail in the cited July post, which you can read, but I can summarize by saying that I see only two real reasons for privatization: to turn long-term assets into short-term cash, allowing more services without raising taxes (and deferring the bill); and to break union contracts. (There is also the argument that it is part of a systematic and deliberate movement of funds into well-connected hands, and you can read more about that in my review of Tom Frank's book, The Wrecking Crew.)

Now we're seeing the opposite happen in response to a crisis, the partial nationalization of several companies, a 180° degree switch in many people's thinking. If this trend continues, government will only own parts of the riskiest companies while shedding those that can easily be made profitable - I find this confusing and will leave it for now.

One thing that has run under the dialogue is a particular distaste for unions. It has been pretty much assumed in the discussion surrounding the proposed auto bailout that the unions are going to have to give back even more, that their time is over. No matter if you're left or right, you have to believe that these union contracts are ruinous, that they're destroying the domestic auto industry.

I didn't grow up in a union household, we thought of ourselves as more "professional" than that, so my impression was fairly ill-formed (and uninformed). I came of age in the era when the power of unions was often misapplied, corruption was thought to be rampant, and ties to organized crime were apparent. As I've matured, however, and seen the excesses to which Big Business is too often prone, I've come to see unions as a counterweight, something necessary in many industries (it's one of those situations where both sides can be wrong, and neither can be allowed to dominate - for example, teachers' unions have some major problems because they have assumed too much power in many districts).

Either way, though, unions are taking it on the chin right now. The process which began under Reagan (I know there are those who say the trend toward union-busting began earlier, but Reagan made it acceptable) has reached full fruit. Privatization leads to the destruction of unions, and so does nationalization.

If you believe, as I do, that unions have a place in our business world, appreciate them now, because there is a whole lot of pressure on them to go away. They're just getting in the way of our genius business executives, and we can't have that, can we?

No comments:

Clicky Web Analytics