It has become evident in the last few years that one of the great problems in American economic life concerns the methods used by unions in organizing employees. Attempts to hide, to disguise, or to ignore the existence of this problem have failed. Events have demonstrated that the common law’s preoccupation was not, as has so often been charged, mere proof of the class-conscious prejudices of common-law judges against the legitimate economic aspirations of the working population.

Common-law rules applied by state courts constitute an interesting and important part of the current law in the United States concerning union organizational methods; but that field of law is at present dominated by federal legislation. According to recent decisions of the United States Supreme Court, the states and their courts and legislatures may, generally speaking, regulate only those labor disputes which are strictly local in character; in other words, those which have no effect on interstate commerce.

Law in the United States today is not concerned as a general rule with establishing the exact wages and conditions of employment of the working population. In regard to the large number of workers whose wages and working conditions are established by means of direct negotiations between them and their employers, without the intervention of labor unions, the law is relevant, indeed, in only the same general and minimal rule-making way that it applies to all private contracts.

The common law, tracing to a large extent to free-market thinking, is a system of general rules for governing relationships, economic and otherwise, involving individual natural persons and such artificial “persons” as corporations which have been given a legal identity by positive legislation. An unincorporated labor union had no legal identity and therefore could not be a party to a common-law action. It could not sue or be sued as an entity, in its formal name.

To this point we have been dealing with the more abstract juridical framework of collective bargaining. We have noted a progression whose net result has been to bring within the rule of law the union as an entity, the concept of collective bargaining through employee representation, and the collective contract itself.

The historical quest of unions for special economic advantage has not been confined to efforts to interfere by violent methods in the free operation of the market. It has been implemented also by nonviolent, monopolistic, economically coercive methods, by legal maneuvers aimed at placing employers in a position more readily vulnerable to union demands, and by devices designed to bring to the aid of unions involved in economic controversies the prestige and influence of political forces.

The United States will have the honor of proving . . . that true policy goes hand in hand with moderation and humanity.

—Jean Baptiste Say

It is a remarkable fact that labor policy has evolved in the United States much along the lines that the theory of the free society would have laid down, had it been in control of events. Free employee choice, the central principle of modern labor relations policy in the United States, is a corollary of freedom of association; and free association is implicit in the principles of private property and freedom of contract, the basic operating principles of the free society.