Tuesday, February 22, 2011

The Market For Unions Is Crashing

Unions and their Left-Wing supporters are demonizing the efforts of governors and legislators, whose only offense is they want to make paying union dues voluntary.

The Teamsters are fed up and not going to take it any more. At least that is what they are saying in essence as they oppose what they call Wisconsin Governor Scot Walker’s “job-killing budget.”

"Wisconsin needs three things right now: jobs, jobs and more jobs," said Gegare. "We do not need a budget that destroys jobs and lowers the standard of living for everyone in the state.

"Walker's budget plan is a partisan, job-killing proposal aimed at punishing his political enemies and rewarding his political backers. Walker claims to be the original Tea Party in Wisconsin."

The argument being used here is, without unions having the ability to forcibly extract union dues from workers, the result will be a loss of jobs. The argument for implementing this is, it will keep the government solvent and save jobs.

To analyze and evaluate these opposing view points, I think we must look at the law of supply and demand. To properly do this, we must examine the most basic principle of microeconomics. When supply is high and demand is low, we know that prices go down. The opposite is true when demand is high and supply is low.

Labor is something we can use in the equation.

When there are a number of workers in a given area that outnumber the number of jobs available, wages go down. Companies figure that because unemployment is high, workers will work for less. And they will, if the government isn't handing out limitless unemployment benefits.

When there are more jobs available than there are workers available to work, wages go up. Workers have more choices based on this scenario. The reason for this is because, if they do not like their jobs they can usually find others fairly quickly. That's why we see a lot of job-hoppers in a booming economy.

So if we look closely at the union position in these cases, we are being told that by compelling workers to pay union dues, this will magically create more jobs and raise the standard of living in these areas. They make these weak and faulty claims in face of looming layoffs that will most certainly be necessary to accommodate union jobs. These are jobs that the employers are forced to pay for, under the duress.

When there is only so much money in a labor budget, it's all a company or government can use and still remain solvent. You only have X amount of dollars to use and if the unions are demanding more, this means a certain amount of people will need to be let go to accommodate the union workers' and their demands.

When people are let go, the union will often blame the company or government when it is in fact the union that caused it. Pointing fingers is little consolation for the one who lost his/her job. The result is more workers looking for work while there are less jobs for them, thus bringing down wages on the whole.

If states have "right to work" laws on the books, it can be used as a tool to attract more businesses to the state. The more businesses in the state mean more opportunities for workers who are looking for work. When this gets to the point where there are more jobs, very often there will be a bidding war between companies for labor and wages will rise. Companies will also do more to retain good workers who show up every day and give it their all.

The only losers in this scenario are the union leaders who have made themselves rich by using agitation and coercion, as a middleman in all of this. Worker sell their time to companies, so companies can make money. If the company makes money, the workers' jobs are secure--unless a worker misbehaves and is terminated for it.

This serves as incentive to do the job, a worker has been hired to do. But under union domination, we have created an environment where tenure and seniority rules. The man or woman who has the most seniority can and often does get away with things, because they are safe from layoffs and the union makes it much harder for the company to shed the dead weight.

Maybe it's time someone makes a stand against this fraud that unions have created in many workplaces, in America. I certainly believe it's time for union leadership to be on the job market, and experience the frustration that comes with losing a job. My guess is the only thing they will qualify for is a position as a petty street thug, who is hired by a mob boss to shake down store owners for protection money.


Chuck said...

Herein lies the involvement of the Obamites. If the unions lose the ability to compel workers to pay dues they lose a lot of money. If the unions lose a lot of money they cannot assist the Dems in their re-election bid in 2012

Catherine Barry said...

I've always thought of union dues as being a big ole "Protection Racket".
Your post cuts right to the heart of the matter Sunset.

LASunsett said...

//If the unions lose a lot of money they cannot assist the Dems in their re-election bid in 2012//

I think that there is a lot of truth to this and it will take a chunk out of the unions/Dems' coffers. But Soros and his syndicate can certainly give a chunk and he will.

Where it really worries the unions, if they cannot give large sums, they will lose their clout and influence. Plus, the fear is they will not be able to deliver the votes. This is why Trumpka talks to the WH everyday.

LASunsett said...

//I've always thought of union dues as being a big ole "Protection Racket".//


Always On Watch said...

If states have "right to work" laws on the books, it can be used as a tool to attract more businesses to the state.

I live in Virginia, a right to work state. And, yes, businesses are moving into Virginia.

Rocket said...

OT but I couldn't resist


The French are now experts on the NFL

LASunsett said...

//And, yes, businesses are moving into Virginia.//

It's only logical.

Terre Haute IN was once the home of Eugene V. Debs. Even unto this day, there is a union mentality in that town. So much so that businesses will not even look at it unless they are willing to deal with union pressure.

I can remember being there back in 1972 and watching union people with sandwich boards parked outside every store of a local drug store chain. A drug store like CVS, Walgreens, Osco, etc.

How pathetic was that?

LASunsett said...


I can't prove it. But I think Greg had something to do with that report.

At PYY, we will keep digging until we get the truth.

Always On Watch said...

FYI....I sent my American Government students a link to this posting.

Rocket said...


I felt the same as you! It's Greg!

LASunsett said...

Thanks AOW.

LASunsett said...


It's the first thing that hit my mind. If they would have said Eli was overrated, he would have been busted.

But...in the meantime....we'll just have to keep digging until we get the evidence.

Rocket said...

I'm waiting for the French to come up with a Cartesian explanation of why the Redskins suck every year.

Maybe the best answer is

"Because they do."

LASunsett said...

Look at it this way, Rocket. A loss is positive feedback. It tells the team something is wrong and gives them the opportunity to fix it.