Disunion Among Unions
What happens when organized labor strikes against another union, and not against a private firm? This is the case in Birmingham, Alabama, where union field representatives and office workers of the United Food and Commercial Workers Local 1657 began picketing their union’s headquarters this week.
These workers are not happy with the contract being offered by UCFW Local 1657 President George Seidenfaden, and so they did what union members do. They went on strike. Yet another union, the Federal Agents International Representatives, or FAIR, organized the strike. FAIR is a union that represents union employees, such as field workers, secretaries, and bookkeepers.
At issue is a contract between FAIR and the UFCW that expired in January. Union representatives are upset that Seidenfaden wants to freeze their pay for three years and replace it with an incentive plan that would grant bonuses based on the amount of new members they sign up. They also demand an increase in their automobile allowances, given that staffing cutbacks have forced the Birmingham union activists to cover more territory.
Imagine that. A union president, proposing a productivity-based contract for employees who work directly under him, is thwarted by representatives of another union that represents the union president’s employees. It’s easy to appreciate the Schadenfreude in Seidenfaden’s predicament.
"We’re fighting for job security," said Max Spivey, a Montgomery-based union representative. "George [Seidenfaden] is acting more anti-union than employers. If he won’t take care of his own employees, how can he take care of employees he represents?"
How, indeed. One would expect a union boss to treat employees directly under him with the same respect, allowances, and benefits that he forces private firms to provide—firms he targets with the aid of federal and state workplace regulations that provide organized labor with a decidedly upper hand in its interactions with private employers.
But not Seidenfaden, who counters that the UCFW’s financial health would be at risk if he gave in to the demands. In the past four years, the local’s membership has fallen from 12,000 to 7,000 (a 42-percent decline). This is because Bruno’s, a large union shop supermarket chain in Alabama, closed dozens of stores during this time period, no doubt in response to financial risks posed by Seidenfaden himself. "That’s a loss of $1.5 million to $2 million in revenue a year," Seidenfaden said. "If I gave in to their demands, I’d put this local into financial jeopardy. These agents don’t understand that you can’t squeeze blood from a turnip."
Unless the turnip is another grocery store that shuts down because it can’t compete with nonunionized chains. So let’s cry some crocodile tears for Seidenfaden. But let’s also note a positive message to be gleaned from this incident.
As Mises reminds us, labor unions are the only entity outside of the state allowed the legal use of force in society, and this is the only reason that they are taken seriously in today’s economy. Although violence has been associated with the labor movement since its inception, it was canonized in the United States in 1932 with the passage of the Norris-LaGuardia Act, which ties the hands of the courts’ efforts to halt union violence. That this legislation has never been repealed is significant. It acknowledges that unions need violence, or at least the threat of it, to be taken seriously.
Since the government protects this activity, firms have few options in the face of a strike. Consumers are afraid of crossing the picket lines, and replacement workers are demeaned as "scabs." Both are threatened with physical harm. If the targeted firm is able to produce any output, it is at a markedly lower level, which causes the negative effects of the union’s violent intervention to spill out to society at large.
This activity is allowed because union members have become one of the primary sources of funding to modern politics. The successful cartelization of labor increases the profits of cartel members, and politicians are sure to get their cut. According to the indispensable Center for Responsible Politics, organized labor transferred over $83.5 million in wealth to political campaigns in the year 2000 election cycle alone. This represents wealth that otherwise might have been used to hire more workers, increase output, and lower prices. Much of it represents union dues that were spent on political activity against the wishes of the union members themselves.
Not that politicians care very much about the needs of the rank-and-file union members. They simply want their money. Career bureaucrats also have a vested interest in keeping this cash cow alive. If it were not for organized labor, there would be many a National Labor Relations Board employee without a taxpayer-funded job.
Perhaps a solution to the problems posed by unions can be found in the internecine squabble between Seidenfaden and FAIR. Union activity itself will be hampered when those employed directly by the unions are allowed to use the same coercive measures on the union that they currently employ on private employers. Just as it is hard to service airplanes when airplane mechanics are on strike, so it is hard for union organizers to attract new members when their field representatives are on picket lines. This can only be positive for those who appreciate the freedom to contract.
It is also positive for those who believe that individuals own their own labor and should be able to sell it to the highest bidder. When Union A’s representatives are busy fighting for higher benefits from Union B’s representatives, they both spend less time harassing workers and reducing the net wealth of society. What’s more, in the context of the fight, many will see some of the full costs that accompany interference with free labor contracts. Enemies are made of groups that otherwise would have been able to find mutual agreement. The diversion of resources necessary to deal with the union demands is more likely to be appreciated.
Many positive results can come from such disunion among unions. Events such as the UFCW-FAIR fight should be publicized so as to encourage similar activity in other parts of the country. Make the unions operate under the same rules that they force employers to operate under as well. Let them learn that voluntary trade of goods and services, including labor inputs, is always preferred to involuntary trade that takes place under the threat of thuggery.
In other words, let them then find a proper, noncoercive role in a free society. After all, in such a society, it is entirely possible that firms would find it cost-effective to contract with union representatives as opposed to individual workers. Money saved in protecting themselves from unions and their beneficial legal status could very well be passed on to workers in the form of higher wages, as is the case in the many industrial and retail workplaces that have successfully resisted state-supported union organization.
It is not clear whether Seidenfaden has learned anything from the conflict he has inherited. But as for now, he sounds awfully similar to the private employers he has harassed over the years. He told his local newspaper that he has met with his workers’ union representatives five times this year and isn’t willing to give into their demands. "I don’t have any intention of meeting again," he said. "They’ve got my best and final offer."
Christopher Westley, adjunct scholar of the Mises Institute, teaches economics at Jacksonville State University. Visit his Webpage or send him mail. See his Daily Article Archive. See also the Austrian Study Guide on Labor and Wages.
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.