You forgot that collective ruin is also an option and we have seen this many times when societies attempted to do away with economic & market concepts.
> somewhere on the spectrum between "egalitarian, flat organization Utopia" and "Slavery"
I didn't say that collective ruin was a result of unionism, only that that you appeared to be trying illustrate a point by outlining a broad spectrum of outcomes, but IMO you forgot one common outcome of forced collectivization. Where it belongs on that spectrum can be debated but that it's a common outcome cannot be.
I provided a range of leader:worker income/power ratios from 1:0 to 1:1 with no commentary whatsoever on outcomes, because my entire point is that the outcome doesn't matter: at some threshold value and below, the existence of the org itself is immoral. We don't have to agree on where that point is, but its existence shouldn't be up for debate, IMO.
I hope we can all agree that a slave plantation should not exist in 2025, regardless of whether it's making billions in quarterly profit, or hovering above insolvency. Paying workers at this plantation $0.01 per hour isn't okay, either, but if you keep adding $0.01/hr N times (and incrementally improve working conditions), you'll eventually arrive at the threshold I was describing.
> They're saying you forgot about the range 1:1 to 0:1.
Color me intrigued! Tell me more about these slave-CEOs serving at the beck and call of empowered workers. I didn't merely forget about the 1:1 to 0:1 range, it's an Outside-Context scenario. I confess I have never encountered - or thought about - organizations with inverted hierarchies. Do you have any specific example of such a thing?
When unions gain too much power and the company can no longer respond effectively to market forces (particularly with hiring/firing), leading to the collective ruin they were talking about.
Who got convicted over Sears, KMart, and Toy's R Us? How about the slap on the wrist for the Sacklers for supercharging to opioid epidemic? What happened the the CEOs of GE from Jack Welsh on who steered the company on into the ground primarily through layoffs and cut-throat business management?
There's plenty of examples of business owners driving a company into the ground to personally enrich themselves.
Not all of those were instances of the management purposely screwing people, but let's suppose some of them were. Should the conclusion then be that we should find ways to prevent that from happening again, or should it be that two wrongs make a right?
Not all businesses fail because of unions, but let's suppose some of them did. Should the conclusion then be that we should find ways to prevent that from happening again, or should it be that two wrongs make a right?
It goes both ways. There are plenty of nations with strong unions throughout. In the US some work is primarily done by unions (such as trade work).
The fact that someone can pull up an example where a union caused a business to go under doesn't make me think "we should eliminate unions". It doesn't even make me think "We should limit union negotiation powers" primarily because unions rights have been curtailed since the Reagan era.
If you wanted to convince me to get rid of unions, you'd do it by setting up robust workers rights nationally which unions provide.
That's the point. We should prevent management from destroying productive companies and prevent unions from doing it, instead of saying "what about those other guys" to justify the bad behavior of either of them.
> In the US some work is primarily done by unions (such as trade work).
You're referring to some of the least efficient industries in the US with high levels of regulatory capture. The fact that there is no test-based path to occupational licensing in many trades, only multi-year "apprenticeship" (i.e. permission from an incumbent), is one of the big reasons construction costs so much, people can't afford housing and government construction projects consistently blow the budget.
> If you wanted to convince me to get rid of unions, you'd do it by setting up robust workers rights nationally which unions provide.
Most "worker protections" are nothing better than highly inefficient alternatives to unemployment insurance. If you have competitive markets then you don't need regulatory protections because companies are subject to competitive pressure. If you don't have competitive markets then you're unconditionally screwed and the first thing you need is to fix that.
"he fact that someone can pull up an example where a union caused a business to go under doesn't make me think "we should eliminate unions""
It seems here it does.
For years every time a company fails that also happened to have a union, the union gets blamed. Never mind the management decision.
It's just a common flame bait for some groups to hate unions. That group doesn't actually reasonably think out these things.
It's like 'woke', the word 'union' is a key word that some groups use to label others for hate. They aren't sitting back and making an economic argument.
The longest time an enron CEO spent behind bars was 12 years. Richard DeLisi was sentenced to 90 years for a nonviolent marijuana charge and spent over 30 behind bars before being pardoned. Kind of puts "serious" prison terms in perspective.
I am pointing out that some commenters here are grading Unions and CEOs on different curves on the issue of negative outcomes, and the alleged union bogeyman is a frequent occurrence at ununionized organizations.
> Multiple people were convicted over the Enron scandal, including some serious prison terms.
That is great, and should have been a deterrent for more ruinous shenanigans. Which CEOs got arrested for the subprime mortgage heists that triggered the 2008 GFC? The GFC made Enron look like jaywalking, I'm sure dozens of executive received life sentences and entire banks shuttered for their malfeasance and lack of internal controls. Right?
Unions are basically useless in a healthy market economy because then companies have to compete for customers and employees instead of having a monopoly, which causes them to have thin margins and therefore leave nothing on the table for collective bargaining to extract that wasn't already being extracted through competitive pressure.
Meanwhile unions in a consolidated market have the perverse incentive to sustain the monopoly because then the union is extracting a portion of the monopoly rents the corporation is squeezing out of consumers at the expense of the 99% of workers who don't work for that specific company. Which is why consolidated markets need not unions but antitrust enforcement.
> Meanwhile unions in a consolidated market have the perverse incentive to sustain the monopoly because then the union is extracting a portion of the monopoly rents the corporation is squeezing out of consumers at the expense of the 99% of workers who don't work for that specific company.
This still sounds like an improvement over the American consolidated market status quo, where the companies and shareholders retain more of the monopoly rents.
Antitrust enforcement would be great, but absent an 1880s-1910s level push, isn't going to happen.
> Antitrust enforcement would be great, but absent an 1880s-1910s level push, isn't going to happen.
Let's do that then.
> This still sounds like an improvement over the American consolidated market status quo, where the companies and shareholders retain more of the monopoly rents.
Except that you then get the union lobbying to sustain the monopoly instead of eliminate it, which makes it even harder to do the thing that actually needs to be done.
> Let's do [an 1880s-1910s level push for antitrust enforcement] then.
The last time that happened was a pre-globalized world, multiple decades of building pressure (including the passage of the Sherman Antitrust Act), and the youngest US president to ever assume office (Teddy Roosevelt).
That's a confluence of events I'm not betting on naturally replicating.
Step 1 would be passing an update to the Sherman Act through Congress that would survive the current Supreme Court.
> Step 1 would be passing an update to the Sherman Act through Congress that would survive the current Supreme Court.
The nice thing about antitrust laws is that they're right in the core of the interstate commerce clause, so it's a real stretch to find them unconstitutional and in practice that hasn't been what has happened. Instead, because the Sherman Act is extremely broad but not very detailed, they've just been narrowly interpreting it. Which wouldn't work if you would pass something that explicitly spelled out some of the things. Like just go make a list of all the existing antitrust cases where something bad was found not to be a violation and make a line in the new law that explicitly calls out that one as "yes it is". Which deletes all the precedents anyone could use to claim that their bad behavior is allowed, since Congress just explicitly said that it isn't.
Another great improvement would be to allow anyone to sue for antitrust violations instead of requiring the government prosecutor to do it.
It would also help to get some bipartisanship happening. The current Court has a conservative majority but you only need to convince two out of six, and some of them are more partisan than others, which actually gives you two ways to win. One, you make a good argument and convince the reasonable ones. Two, you stir up the conservative base against some California corporations. Probably easier to do the next time there is a Democratic administration because then they'll start kowtowing to the new administration instead of Trump and thereby anger the conservatives again.
Unions are about building worker rights and protections into the business expenses. When they are industry wide, it prevents any company from gaining an advantage by exploiting their workers.
A strong market economy is orthogonal to the treatment of workers. For example, the economy of the early US was both very competitive and had slavery. Same for islands like Jamaica.
The ideal is government regulation ensuring worker rights. Barring that, unions fill the role. Unions exist to fill a void created by a low regulation market. They are the libertarian solution.
> When they are industry wide, it prevents any company from gaining an advantage by exploiting their workers.
If one company is exploiting their workers in a competitive market, what prevents those workers from going to work for any of the other companies?
> For example, the economy of the early US was both very competitive and had slavery.
Slavery is a government regulation that says that if someone pays a stranger money then you have to do work you never agreed to do. Markets are the thing where you only have to do something if you agreed to do it.
> They are the libertarian solution.
They're an attempt to monopolize the labor market in an industry. When unsuccessful they're useless because they have no bargaining power, when successful they're an abusive monopolist extracting undue rents from that industry's customers.
> If one company is exploiting their workers in a competitive market, what prevents those workers from going to work for any of the other companies?
Depends, is there a labor shortage or a surplus? It might be cheaper for a company to train a replacement than it is to treat employees better. If there's a labor surplus, then the employer has a lot of power of the situation.
> Slavery is a government regulation that says that if someone pays a stranger money then you have to do work you never agreed to do.
Nope. In fact, slavery was contract/property law. There wasn't a government regulation or statute that established or regulated it. That was part of the problem. Slavery was the ultimate in libertarian ideology because it recognized that through whatever means, individuals could end up the property of other individuals. It further recognized children as the property of their parents (and thus property of the slave owners).
You can consider indentured servants, for example. Someone willingly signs themselves into slavery to pay off the debt (usually the boat ride to america). Slavery was a natural extension of that concept.
The only role the government served in this situation was enforcing the slave contracts.
> They're an attempt to monopolize the labor market in an industry.
That's not a refutation. Libertarian ideology (particularly the free market form) has no problems with a monopoly.
I do, which is why I think government regulations and actions to break up monopolies is a good thing.
But in a market without government protection for workers, unions forming a labor monopoly is the only solution which can counteract the inherent power imbalance between employer and employee.
I'd not classify them as "abusive" because far more people benefit from strong employee protections than the people harmed by those protections. The ultimate harm is it makes businesses less profitable.
> Depends, is there a labor shortage or a surplus?
That determines things like wages. It doesn't allow companies to do things like cause $1000 in damage to you in order to save $10, because then they'd have to pay you $1000 more than the company that isn't doing that or you'd still go work there instead.
Also, if there is a labor surplus then how is a union going to do any good? The company would just let them go on strike and hire replacements.
> In fact, slavery was contract/property law.
That seems to have the word "law" in it.
> It further recognized children as the property of their parents (and thus property of the slave owners).
Which is obviously not something the child consented to.
> You can consider indentured servants, for example. Someone willingly signs themselves into slavery to pay off the debt (usually the boat ride to america).
There are arguments to be made against this, but it's significantly more defensible than doing it without consent. Because then who is going to do it? And how is it really different than e.g. non-dischargeable student loans, a thing the government still does?
> The only role the government served in this situation was enforcing the slave contracts.
The only role the government serves in a contract to form a cartel is enforcing the contract too, which is why there are contracts the government shouldn't enforce.
> Libertarian ideology (particularly the free market form) has no problems with a monopoly.
Libertarian ideology assumes that monopolies form as a result of government rules. It obviously can't allow for unrestricted anti-competitive contracts because then someone with a monopoly on any necessity could force everyone into a contract to form a dictatorial government, which is anathema to the entire ideology. But contract law is the government. A government that didn't enforce contracts at all and only enforced laws against violence would be perfectly consistent with it, whereas a government that enforces contracts you never agreed to or that you were forced to sign under duress would not.
> But in a market without unions and government protection for workers, unions forming a labor monopoly is the only solution which can counteract the inherent power imbalance between employer and employee.
How is there an inherent power imbalance in a competitive market? They can choose a different employee and you can choose a different employer.
> I'd not classify them as "abusive" because far more people benefit from strong employee protections than the people harmed by those protections. The ultimate harm is it makes businesses less profitable.
The ultimate harm is that it makes the industry's products worse or more expensive to customers, or increases market consolidation if a union destroys a company in an industry with high barriers to entry and thereby causes there to be fewer of them.
Current US law forces companies to negotiate with a union if it's employees vote for it. That seems like the opposite of a healthy market; it is a market in severe regulatory capture.
A healthy market would allow voluntary decisions by both parties. It would allow management to choose whether they want to negotiate with a collective broker, and it would allow workers to choose whether they want to find employment congruent with their preferences to either self negotiate or hire a third party.
How isn't it a market solution for a collective of individuals to band together to determine what they think are fair conditions of wage and labour? If they are wrong then the whole thing fails just like a business mispricing and/or mistreating its customers would, if they are right they all get a better deal.
It's a freer market than allowing disproportionate power of employers in the labour market distort the price of labour.
Unions are the reason we have a 40 hour week, minimum wage, equal (ish) pay, reasonably safe working conditions, overtime pay, holiday, etc. Anti-union think is a Reagan/Thatcherite psyop, don't drink the kool-aid. Notice that since the dismantling of the Unions both here (UK) and across the pond the average person's life has steady a steady economic decline? Not a coincidence.
That's probably not a great example given that the rust belt was thick with unions.
And in general the US has a cost of living problem because the various levels of government keep getting captured by people who want regulations that make costs to go up because they're the ones getting the money. That makes US workers less competitive because of the corruption-induced regulatory costs, which is exactly the opposite of markets working as they should, except insofar as "industries move out of countries with high corruption and inefficient laws" is supposed to apply pressure to countries to get more efficient rules.
> That's probably not a great example given that the rust belt was thick with unions.
Perhaps we need to complete the thought here: was it the unions or executives that decided to offshore manufacturing? If the counterargument that unions are to blame for offshoring by "artificially" increasing the cost of labor, and should have competed with Chinese labor on price and they got their just deserts: then why are executives now (successfully) lobbying for protectionism against Chinese manufacturers? Why can't capital handle the type of rugged capitalism they inflict on American workers? If chinese goods could be ported as easily and cheaply into America and American labor was ported to China, there'd be blood on the floor.
> was it the unions or executives that decided to offshore manufacturing?
Neither. It was consumers, who prefer lower prices.
> why are executives now (successfully) lobbying for protectionism against Chinese manufacturers?
Because they were fools who thought they could offshore the factory work but not the management work.
> If chinese goods could be ported as easily and cheaply into America and American labor was ported to China
This is literally what has already happened.
The actual solution is for the US to do something about high domestic costs, especially housing and medicine, which are the things keeping US workers from being globally competitive.
>> was it the unions or executives that decided to offshore manufacturing?
>Neither. It was consumers, who prefer lower prices.
Right, because every executive who pursued offshore manufacturing was thinking, "gosh, how can I deliver even lower prices and better value to my customers?", and not "OK, we've shown the market will pay $X for product Y, how can I cut my costs and free up more money for bonuses and cocaine?"
Graphs of price indices (aside from a few sectors such as electronics where it was the core technology that improved, not labor efficiency) and wages over the last 50 years clearly show that the bulk of any offshoring savings were not passed along to consumers or front-line workers.
> Right, because every executive who pursued offshore manufacturing was thinking, "gosh, how can I deliver even lower prices and better value to my customers?", and not "OK, we've shown the market will pay $X for product Y, how can I cut my costs and free up more money for bonuses and cocaine?"
Suppose it used to cost you $1 to make something in the US that you had been selling for $1.50. The cost of domestic real estate and other things goes up, so now to make it in the US it costs you $1.60. If you sell for $1.50 you're losing money and to have your previous gross margin percentage you'd have to sell for $2.40. Meanwhile it still costs $1 to make it in China and one of your competitors is doing that and still selling it for $1.50.
Your options are a) don't raise prices, lose $0.10/unit and go out of business, b) raise prices, lose all of your sales to the company who still charges the old price and go out of business, or c) offshore manufacturing.
The only way out of this is to get the domestic costs back down, which is a matter of changing the government policy over zoning rules etc.
> Graphs of price indices (aside from a few sectors such as electronics where it was the core technology that improved, not labor efficiency) and wages over the last 50 years clearly show that the bulk of any offshoring savings were not passed along to consumers or front-line workers.
Are these graphs being adjusted for the increasing cost of things like domestic real estate having to be incorporated into the prices of everything? Even if you make it in another country you still have to pay for a domestic warehouse or retail store.
Regulation is a requirement in actual capitalist/market thought. Only fairly recently have libertarian's retconned in their 'free market requires no oversight' nonsense.
I agree, we should return to Adam Smith style capitalism/markets, with his strong promotion of regulation against monopolies, corruption, and rent-seeking
> Only fairly recently have libertarian's retconned in their 'free market requires no oversight' nonsense.
You have to realize that there are people who call themselves "libertarians" who are actually plutocrats, just like there are plutocrats who call themselves "progressives", because people wouldn't agree with them if they would plainly state their actual goals. Whereas pretending to be the people who want to take you down serves the dual purposes of stealing the support of their base for your corruption and then undermining the support for the people who actually want to fix it once other people see what you're doing under their banner.
Reminder that up until recently, economic & market concepts included a requirement for strong government oversight. The originators/thought creators of capitalism talked about the need for such. Adam Smith argued relentlessly for regulation against monopolies, corruption, and rent-seeking. Libertarian ideologues retrofitted in the fantasy of self-regulating markets without oversight fairly recently and it is turning out to be a pretty disastrous retrofit. I agree, we must go back to true, pre idealog economic & market concepts, like Adam Smith argued for.