Unions - Good or Bad

[Guest SUNTZU]

I want to know your opinion on unions, and why you feel that way. I've been giving thought to this after listening to all the talk about the American motor industry.

Why unions are good

In much of industrial America, workers toiled under very unsafe conditions, earning extremely low pay and enjoying little to no legal protection. Unions were successful in bringing about many improvements for such workers, such as more reasonable working hours. They have generally served workers well by helping them avoid being exploited by employers. Even in these days, unions have a strong impact. According to the Bureau of Labor Statistics, union members in 1999 had median weekly earnings of $672 (that's $34,944 per year) while non-union workers had median weekly earnings of only $516 ($26,832)

Why unions are problematic

Much as I'd rather not accept it, while unions have done a lot of good and have helped workers avoid exploitation, they also seem to have helped workers exploit employers. Perhaps it has been a gradual shift over time, with unions slowly accumulating more and more power.

Unions can have the power to impede a company's ability to compete and thrive. A firm might be in desperate trouble, yet its unions may be unwilling to bend or compromise in order to help the company survive. Many employers find themselves left very inflexible when they have union contracts to abide by.

Some more problems with unions:

• Anti-competitiveness. The Socialstudieshelp.com website suggests that, "unions. are victims of their own success. Unions raised their wages substantially above the wages paid to nonunion workers. Therefore, many union-made products have become so expensive that sales were lost to less expensive foreign competitors and nonunion producers."
  
• A decline in the value of merit. In many union settings, workers can't advance much or at all on their merits, but must generally progress within the limits defined by union contracts. Employers may have trouble weeding out ineffective employees if they belong to unions. In theory, at least, unionized workers might become so comfortable and protected that they lose the incentive to work hard for their employer. And outstanding employees might lose their get-up-and-go if there's no incentive to excel -- or worse, if they're pressured by the union to not go the extra mile.
  

From this site: http://www.fool.com/investing/general/2003/10/30/unions-good-or-bad.aspx

[DRM]

Quoted material is a fair representation of my feelings.

Unions were started because the gov't wasn't protecting workers. The gov't is now protecting workers - and the unions are standing in the way of employer survivability.

[Guest Jcochran88]

i agree, unions are one of the biggest reasons that american companies have sent there work over seas. I am all for a fair wage but with all the things that they have i don't blame a company for finding employees that will do what you need them to do without having to check with their union rep to see if that is ok.

[jay1313g]

I read this a while back and still chuckle when I think of it:

Definition of a STRIKE - Strangling the chicken because it's not producing enough eggs!

[VERO1]

I am a Postal Union Member, it is the first I have ever belonged to. I am a member not a supporter. The biggest problem I have with it, is the way worthless employees who need to be fired, are protected. I also have a problem with them telling me who I should vote for. They are also kind enough to give part of my union dues to the candidates of their choice. That is, whatever is leftover after the convention. These are usually held in a resort city somewhere!

Damn! I sound disgruntled.

[Guest Boomhower]

Unions = bad.......the auto industry needed to grow a set of balls a long time ago and say no a lot of the unions demands. But no, now the tax payers get to bail them out so they can continue to give benefits and pensions to the family's of deceased workers......this bail out chit is getting ridiculous.

[PirateQui]

You should read the Undercover Economist - this is a great book - Here is the problem as I see it:

I reject in principle the idea that people deserve a certain amount of money. A union is just another way to enforce a minimum wage, though in this case it can be arbitrarily high wage and include other perks. When we set these types of regulations we remove the ability for businesses to reward productive employees commiserate with their performance / abilities.

If we speak in terms of economics the issue comes down to everyone 'winning'. I will try to explain by using the idea of coupons and sales. It is obvious by the existence of sale items and coupons that some items can be sold much cheaper than they regularly are and the company will still make profit. The goal of the company, however, if to make the most money possible. Some consumers are not price sensitive - They just don't care how much a box of cheerios costs. While some consumers are extremely price conscious. Let's assume that each box of cheerios costs .50$ to make and the regular price is 1.00$. It is in the best interest of everyone involved to make some money - even if it is only 5 cents - from the price sensitive consumer instead of making 0$ because they will pass it up. This means the company has to provide the good very cheaply to the price sensitive consumer. However, the company cannot make the good that cheap regularly - because then they won't be maximizing their profits - some people will be willing to pay 1.00$. What you do then is you make the regular price high and provide sales and coupons for the price sensitive consumer. The extra work required on the part of the price sensitive consumer to get the lower price is worth it to them but will not be worth it to the consumer that doesn't mind the price. In this situation the company maximizes profits by ensuring they get some amount of profit from every potential customer.

Unions / minimum wage is essentially the same thing. All people have some dollar amount at which they value themselves. This is some amount of money that they have decided they will not work above, the employer also has a maximum amount they are willing to pay their employees. In this situation the higher wage is analagous to the lower price on cheerios. The company requires some extra effort in the form of negotiation, performance, time at the company, etc. to obtain the higher wage. People who are willing to work for less will work for it and the people unwilling to work for it will either make more or re-evaluate how much they are worth as an employee as a result of the rarity / skill of comparable employees.

At this point I could point out the common arguments that tout common anti-socialism talking points but these will all be very politically charged and ultimately ineffective. So then I will jsut say this: The fundamental belief that all people are equally valuable is a flawed, naive, and unrealistic belief. Society functions daily through the machinations of millions of people doing sometimes small thigns that are important - this I will agree with, it is important that the coffee farmer in south America is doing his job. The point though is that the theoretical physicist is more valuable - There are just less people with his skill set available - where as laborers can be had easily. Similarly, the worker on the line who makes 1000 parts a day is far more valuable than the person who makes 750 parts a day. My father is an industrial plumber who works on commission. The commission system admits immediately, and without remorse, that we are all not equal, we all deserve to be paid in scale with our output.

Unfortunately, we have these unions because there were some circumstances in the past that allowed corporations to break the free market model and take advantage of their workers in extreme ways. In some ways it is the job of some sort of organizations, perhaps the government, to protect workers who honestly lack the ability to value themselves. But unions only help the people who aren't exceptional, and hold back the truly exceptional.

*Excuse any spelling mistakes I pounded this out in about 10 minutes*

Edited November 18, 2008 by PirateQui

[PirateQui]

The biggest problem I have with it, is the way worthless employees who need to be fired, are protected.

This is the exact issue my post is talking about. If you couldn't tell I like writing articles on political issues.

[Rightwinger]

Unions are dinosaurs living with us today. Another perpetuated class war between management and workers. It builds walls, not productivity. All the above are excellent points.

[Guest Halfpint]

Personal experience from unions on the pipeline . . .

Two summers ago, I was around for a union strike--they lined up every morning for a regularly-scheduled protest outside the gates of the equipment yard, holding signs and shouting insults and stuff. "Be fair to the working man," "You don't care about the little man," etc. Last I checked, a basic laborer making $1100 a week working a fifty-five hour week was plenty damn fair--I was the "low man on the totem pole" at the time, 20 and putting myself through college--making $1250 a week. Most of these guys were laid-off equipment operators, who would have been making ~$1600 every week . . . and yet they were complaining about it and refusing to take a "lowly" manual labor job.

The biggest thing I got out of being around a union was hearing "We know who you are, Blasdel, we know where you live, and we're going to find you and teach you a lesson for getting us fired." It wasn't my fault they got fired--they kept pressing for more money and refused to work when they didn't get it, so the gas company brought in a private contractor, whom my dad and I worked for, to finish the job. I'm sorry, but $70k+ a year, weekends off, holidays off, is good money--do your job and quit bitching. Anyway, they were threatening--however harmless in reality--to basically kick my a$$ for working when they refused to. I have about as much respect for unions as I do any other people who expect to be given more when they don't DO more.

/rant

Edited November 18, 2008 by Halfpint

[Fallguy]

Can't add much to what has already been posted.

They were good and needed at one time, but have long since no longer served a good purpose.

[Guest REDDOG79]

I work in industrial construction. I have only worked non-union so I can not say that i have any experience working Union. But as I see it when they were formed Unions were a needed force to keep working conditions safe for workers and to keep companies from having slaves that buy from the company store and stay in debt to the company.

I have worked as an ironworker/rigger, equipment operator (fork truck/fork lift boom truck and carrydeck cranes), structural welder and now I am pipefitting and pipewelding. I am 28 years old and have worked full time for various companies since 2000. I have had the opportunities to change crafts and learn different things.

The adage of "The More you know the more you are worth" holds true as I can work as a pipefitter during the week and then come in on the weekend to operate equipment or weld for someone that didn't want/need the overtime.

At my current job there are many worthless people working there that don't deserve the pay they recieve. They also aren't the ones that are kept to finish shutdowns or come in on weekends to complete the hot jobs that are needed to be accomplished. There are some people there that make more on the hour as they do more work and get more accomplished than the others. I have been offered leadman positions on crews as early as 21 years of age and I don't believe that you can do that on Union jobs and be in charge of people with more seniority than yourself.

I think work ethic and enthusiasm are a better way to make my living than how may years I have with a company or how much seniority I have

Edited November 18, 2008 by REDDOG79

[molonlabetn]

Unions were necessary at one time (safety and fairness issues primarily)... but that time is long gone. The quoted comments are right on, and based on my own personal experience having to deal with union workers... productivity and morale suffers because it creates an artificial 'us vs. them' mentality. And on top of that, the legacy costs incurred by unions' inflating worker cost without increasing value have ruined many companies, and resulted in the export of many jobs... one might even point to illegal immigration as a symptom of how broken the labor market really is.

[Guest c_o_jones]

I have posted this article before, but it is still a good read on unions from Dr. Thomas Sowell.

Something For Nothing: Unions

by Dr. Thomas Sowell

Government is not the only institution that promises something for nothing.

The decline of General Motors is just one consequence of the idea that labor unions can get their members something for nothing.

Workers themselves increasingly recognize the reality that there is no free lunch through unionization and are increasingly voting to be non-union.

But the word has yet to reach many among the intelligentsia, who still think of labor unions as institutions that benefit the working class.

You can always benefit particular segments of any society at the expense of some other segment but unions do not benefit even the working class as a whole --

just those who are current union members -- at the expense of other workers, current and future.

One reason that General Motors has been losing market share for years -- going from selling about half the cars in the country to selling about one quarter today --

is that its union contracts put them at a disadvantage compared to its Japanese competitors.

Even though Toyota has factories in the United States, the American employees in those factories vote to keep their jobs by staying non-union.

Toyota takes business away from unionized Detroit car makers, who are forced to lay off thousands of workers while Toyota is hiring additional workers.

There may not be any big difference in pay scales but unions can create higher production costs in many other ways. Fringe benefits are just one.

Work rules are another.

In some industries, employers pay their workers as much as, or more than, unionized workers receive for the same jobs,

just in order to be free of red tape restrictions on how they can organize their business or discipline employees who aren't doing their jobs right.

Toyota, for example, takes fewer hours to produce cars with fewer defects than Detroit cars.

While unions are declining in the private sector, they are expanding among government employees. Government agencies are usually monopolies,

so competition is no threat to their jobs.

Taxpayers get hit with the high cost of these monopolies. There is no such thing as something for nothing.

Teachers' unions fight desperately and ruthlessly against vouchers, because they must maintain a monopoly of school children under the compulsory attendance laws.

Their members stand to lose jobs if forced to compete with private schools.

Monopoly is the key to unionized teachers' job security -- at the expense of children's education as well as the taxpayers' money.

Labor unions in the private sector have long been in the forefront of those pushing for higher minimum wage laws.

Usually union members already make much more than minimum wages but they need to safeguard their jobs from others who could do the same work for less.

People on the inside looking out benefit at the expense of people on the outside looking in.

Losers include not only less experienced and lower skilled workers, whose output would not cover the cost of the minimum wage, but also future workers who may find fewer job opportunities in the unionized industries.

Minimum wage laws are like protective tariffs insulating unionized workers from the competition of other workers.

It is robbing a less affluent Peter to pay a more affluent Paul -- all the while using noble rhetoric that appeals to the uninformed and the unthinking,

which includes many people with fancy degrees and even fancier illusions about their own higher sense of compassion.

Some people may believe that unions benefit their members at the expense of employers -- and that big corporations should be paying a "living wage."

That may be possible in the short run. But think about it: If unionized workers producing widgets get higher pay by reducing the rate of profit of widget manufacturers,

do you think investors are going to continue to invest as much in the production of widgets when they can earn higher rates of return by investing elsewhere?

The rate of return on widgets cannot remain permanently below rates of returns in other industries. Widget prices will have to rise --

and that means lower sales and lower employment. There is no free lunch, no way to get something for nothing.

[poak]

Unions are the reason I cant buy a decent American made socket set without paying an arm and a leg.

[kckndrgn]

My best "why unions suck" story comes not directly from me (though I have worked in a union before) but from a company that I used to work for. Once a month the president of the company did a "new employee meeting". I thought, "oh joy, get to listen to a bunch of BS from the pres, happy happy, joy joy". Boy was I wrong, best meeting of my life.

One part was about unions. He said that the employees could form a union, or join one, it was their "right", but as soon as one was formed in the company they (president and CEO) would close the doors, as that was their right. Then he went on to give a story of why he hated unions.

Early in his career he worked for a manufacturing company, one day while walking through the factory a worker was on a ladder fixing some equipment when he dropped a bolt. Being the nice guy that he was, he retrieved the bolt, and handed back to the union worker. Later that day he was called into his supervisors office as was told there would be a "formal reprimand" in his file because, "as a non union worker, he the work of a union worker".

Yup, the guy that he "helped out", formally complained that a "non-union" worker was doing his job.

Now my only experience with a union is when I worked as a janitor for a hospital while in college. All they did from me was take over half my check.

[Mark@Sea]

Unions? You mean where organized crime went to become legit?

[Guest Rugerman]

Unions are outdated and ruining american manufacturing. I agree with most everyone in this thread.

[Guest Dean_JC78]

Can't add much to what has already been posted.

They were good and needed at one time, but have long since no longer served a good purpose.

yeap. Unions are a cancer on the American Economy. They are the major reason that the "Big 3" are failing, our education system is failing, and the airlines have been failing.

I am all for workers rights, being a worker myself, but to smack the invisible hand of the marketplace through extortion of employers is just not a wise thing to do and bad for all of us.

[The Average Joe]

Unions have outlived their usefulness.

[Will]

Few years back the company I was with always said they would close if it went union. With not much to lose we brought in UAW for vote after they told us if anything went wrong we would have union jobs the next day. Company closed for one week and hired all new people. and UAW would not take any of our calls.

last dealings with unions. The NLRB dropped any action for us.

[towerclimber37]

When I was a young man, I was in a union for bricklayers..being that I once was a bricklayer. I remember finding out that an old bricklayer retired...he'd worked hard all his life and was a staunch supporter of the union. He also paid his dues religiously. when he retired, the union gave him 28 dollars a month retirement.

The day I found that out, I called our local and spoke to Jody Sessions who was the Union president..I told him that I would no longer be a part of the union and I was quitting them that day. First he was cordial and tried to bribe me with a couple of different lucrative jobs...I didn't want them. then he threatened me with the "you'll never get a decent job in this town again" type speech. My older brother heard that..and being a ruffian himself, took the phone from me and explained to Jody that, even though he'd known him all of his life, he'd beat the brakes off him if he ever found that Jody had taken a good job from me by dishonest means. he then quit the union himself.

Jody, knowing my brother John, found it prudent to leave us alone..(my brother John was known to be a brutal man when the situation demanded it.) That was the day we started our own business....didn't do too badly.

[Guest Astra900]

Unions are the reason the BIG THREE aren't the big three anymore.

It used to be GM,Ford, Chrysler.

Now it's Toyota, Honda, Nissan.

Why? You buy a Toyota, you buy a damn fine auto.

You Buy a Chevy, and unless it's made on Wed. it's not half the vehicle.

You want to buy American, buy one made on WED!

Mon = Hangover

Tues = Grouchy cause of yesterday's hang over

Wed = decent attitude

Thur = looking forward to fri, mind not on work

Fri = Already started drinking for Sat

[chipperi]

I'd Agree with the article. What Unions were originally intended for is now covered by Federal law. Things such as workplace safety, fair wage , limited work hours , etc.

I now work in Printing and if we were to go Union I would wager we would be shut down and all of our presses shipped to one of our plants in China or Mexico within a year.

Unions now a days take your money and do very little for you.

TN is a "Right To Work" state so Unions have no real power over employers here as you cannot have a closed shop in TN.

[greenego]

I have heard and seen the good and bad side of unions. Having grown up in W.VA. I am old enough to have heard how bad it was before the unions. I am young enough to have seen the unions help end deep mining. The biggest problem I have with unions is they are like the government. They stop looking out for the people they are suppose to help and only look out for themselves.