It’s not often that a union election makes front-page news. But last week’s stunning loss by the United Auto Workers at a Volkswagen plant in Chattanooga, Tenn., is a seminal event in the history of the labor movement. Union membership has fallen consistently over the past 60 years, and the UAW loss suggests there’s no way for labor to reverse the trend — at least not in the private sector. But why?
The UAW blames Republican politicians and conservative groups — outside agitators, if you will. Sen. Bob Corker, a former Chattanooga mayor, weighed in on opposing unionization at the plant during the voting, claiming a vote against the union would enhance the chances that VW would give the plant the right to build SUVs, adding hundreds of jobs. But the bigger problem was that the union had little to offer prospective members. Workers get little in return for paying dues that equal two hours’ pay monthly.
There was a time when the difference between a union job and a nonunion job paid off. Unions offered job protection, steady wage increases and, most importantly, generous benefits, including first-rate health insurance. Indeed, the reason most employees receive health insurance through their employers is that unions demanded the benefit in their collective bargaining agreements during World War II when the National War Labor Board imposed a freeze on wages. The new benefit — which was tax-free — was so popular with workers that even nonunion employers adopted it in order to attract employees.
But with the advent of ObamaCare, even that union advantage has disappeared. Not only is health insurance now available to everyone (though not everyone wants to pay for it), but unions can’t bargain for the kind of Cadillac policies they once could. Even with union carve-outs granted by the administration, most employers will balk at gold-plated policies when forced to pay ObamaCare’s 40-percent excise tax and can do so with impunity as long as the plans they offer meet the ObamaCare minimum requirements.
Wage differences between union and nonunion jobs are significant in some industries, but they often come with a price. Markets determine wages, no matter how hard unions and governments try to interfere.
Unions can negotiate higher wages only if productivity also increases so that owners still make a profit worth the risk and investment it takes to stay in business. But union work rules often impede productivity. And even if productivity doesn’t lag, competition from nonunion companies producing similar products or offering similar services at a lower cost may make union companies less profitable. If unionization pushes wages higher than the market will bear, those companies are forced to cut jobs or go out of business. A union card doesn’t do you much good if your job disappears because of it.
No doubt all of these factors played a role in the decision by the majority of VW’s workers to vote against the UAW. But politics also played a role, though not in the way the UAW alleges.
The UAW, like the rest of the labor movement, has spent increasing energy and resources on politics as its membership has shrunk. Unions now devote as much if not more time and money to electing Democrats than they do to organizing new members. Some 90 percent of union political contributions go to Democratic candidates, and union staff and “volunteers” are the backbone of campaigns to elect Democrats at all levels of government. Yet 40 percent of union households voted Republican in the last presidential election, despite unions’ unprecedented efforts to turn out their vote for the Democrats.
Many of the Chattanooga VW workers, no doubt, felt a cultural rift between their values and those of the UAW. Unions have become little more than subsidiaries of the Democratic Party, promoting liberal policies with which many of their own members disagree. And union dues pay for bloated bureaucracies and entrenched union leadership not open to effective challenge.
No wonder fewer than seven in 100 private-sector workers choose to join a union.
The UAW and the rest of the labor movement can expect more disappointments like that in Chattanooga, and there’s not a lot unions can do to change it.