What Right-to-Work really means

You don’t need me to tell you labor unions just lost another battle. Michigan became a “right-to-work” state. So workers there no longer have to join a union to get certain jobs. Last year the battleground was Wisconsin. Unions lost there too.

Union leaders clanged alarm bells over the Michigan loss. Union thugs warned that blood will run in the streets. President Obama proclaimed that right-to-work laws are about the “right to work for less money.”

He is correct, in a sense. He also declared that such laws “don’t have to do with economics – they have everything to do with politics.”

In this he could not be more mistaken. Right-to-work measures have everything to do with economics. So do the unions’ problems. Everything. Especially that ingredient of economics called competition.

Unions do not do well against competition. They deliver a lot of benefits to members. They truly do. Better wages. More generous healthcare and pensions. But these benefits jack up costs for employers. Simple as that.

If employers face no competition from non-union shops, fine. They raise prices. Pass costs along to customers. Your mom and dad paid extra for their Oldsmobile. The extra paid the union benefits. We all shell out extra school taxes. To pay for teacher pensions and healthcare and good pay. We pay extra in taxes to cities and states. To pay for retirements for workers after only 20 years. Used to be, none of these industries had competition.

When employers face competition from non-union shops, the unions try to close down those competitors. Example: Teacher unions spend millions to kill vouchers kids would use to attend private schools. Those unions fight against charter schools. They try to unionize their workers. We used to see efforts like these in the private sector.

Well, unions are losing battles these days because they cannot do much about the competition. In the public sector they usually have no competition. But in manufacturing and many service industries they do. And that competition is from non-union workers in China. And India. And other Asian countries.

The greatest problems private sectors face are from workers in other countries. Union shops in Michigan cannot compete against non-union factories in China.

If our unionized schools and state and local governments had to truly compete against non-union shops, they would lose. If unionized colleges had to compete openly against non-unionized schools, they would lose.

Union operations work best when they are protected from competition. That protection is long-gone in the private sector. Which is why most union jobs in that sector are long-gone.

There is no question that millions of jobs pay less and give fewer benefits than they did years ago. The decline of unions has reduced the standard of living of many Americans. Until Asian and Indian workers earn $20 an hour we are not likely to see much improvement.

From Tom ... as in Morgan.

Find Tom on Facebook. For more columns and for Tom’s radio shows (and to write to Tom): tomasinmorgan.com.

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