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So why did unions arise in the first place? Because didn't most unions form in the mid 19th century, when the economy was almost completely free? Also, without unions, what will keep employers from "exploiting" their workers? (I hate to use that word, but I'm trying to play devil's advocate).

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So why did unions arise in the first place?
Dunno, ask a historian. Various reasons, for example they arose in a non-ideal society, some employers were willing to use force against employees or potential employees, many people did not get the basis of "value" (it's not the same as "cash", thus labor does have value). A lot of it was thanks to an appeal to irrationality, the hope that infinite wealth would descend on workers if only they would join the union.
Because didn't most unions form in the mid 19th century, when the economy was almost completely free?
Free from government regulation, but not free in the sense that the government did not initiate force against workers.
Also, without unions, what will keep employers from "exploiting" their workers?
I don't know what "exploit" means. Seriously. What is to keep workers from exploiting employers, demanding exorbitant wages and benefits? Each side gets to "exploit" to other, that is, get the best deal they possibly can, by peaceful means.

What people generally mean when they say "exploit" is "make a profit based on the labor of others". Well, with unions, they have not managed to completely eliminate exploitation i.e. profitability, but they have certainly reduced profitability some. But in an ideal society, reality wins and the objective value of someone pressing a button every 2 second becomes clear (especially in light of the fact that we've figured out how to make machines that do the same, and they are usually cheaper). If an employer is offering unrealistic wages, he will have a hard time getting any people to work for him -- rational men will choose to work where their value is recognized monetarily.

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I suggest reading Nathaniel Branden's article on unionization in Capitalism: The Unknown Ideal. I started to read an essay by an author Mr. Branden quoted, Ludwig VonMises, and it too provided some insight into where unions came from and what purpose they serve. In the essay, he states something along the lines of "unions have the right to organize, but to use coercive force to mandate a minimum wage and work standards is unethical and a violation of rights. Since this is exactly what they do, their role as understood today would not and could not exist in an entirely free society." (Not a direct quote)

In thinking back, also, I would say that unions received tons of support because of some highly misunderstood isolated incidences of employee abuse. I would relate the literature of the time to something like a Michael Moore movie today, but this is obviously entirely speculation on my behalf.

From a business point of view though, it makes very little sense to abuse employees since businesses must compete for workers just like any other asset. If company a and b do the same thing and pay the same wages, if company a makes employees work 16 hour days and take no breaks, while company b recognizes that shorter days with a break provides more profit and happier employees, obviously as an employee you would work for company b.

Edit: I should add, I mean profit to company b because of increased production (healthier, happier employees = production = profit).

Edited by eddyj
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  • 2 weeks later...

Unions have no value. I would argue that even in the 19th century they had no value. Obviously workers voluntarily migrated from the farm to the city specifically to work for a factory. If the conditions were so horrible, then why did people move to the cities at all? If they started working in a factory and didn't like it, then why not quit? There was clearly some compelling reason that drew the workers in AND kept them working in the factories. So clearly life in the factory was an improvement over the farm life they came from.

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If they started working in a factory and didn't like it, then why not quit? There was clearly some compelling reason that drew the workers in AND kept them working in the factories. So clearly life in the factory was an improvement over the farm life they came from.

It's not about how much the "capitalist" has given, but how much he has left. Anything above nothing is too much.

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I don't know what "exploit" means. Seriously.

It means the employer knows the employee will have trouble getting another job, that there's lots of unemployed people out there that he can employ and that he can threaten him to accept his conditions to work more and earn less or get out.

What is to keep workers from exploiting employers, demanding exorbitant wages and benefits?

Other unemployed, potential workers. If the employee posesses a rare skill and there's a lot of good employers offering a job, then the employee has more power than the employer.

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It means the employer knows the employee will have trouble getting another job, that there's lots of unemployed people out there that he can employ and that he can threaten him to accept his conditions to work more and earn less or get out.
Are you defining "exploit" exclusively as a relationship between employers and employees? For example, you see people babbling about companies "exploiting" customers, so under your definition, that wouldn't be exploitation. I'm not really clear on what counts as an "employer" and an "employee". Like if I want to hire a contactor to build a deck for me, am I an employer and he my employee? So if there are multiple contractors competing for the same job, am I exploiting the contractor that I do hire?
If the employee posesses a rare skill and there's a lot of good employers offering a job, then the employee has more power than the employer.
How do you calculate relative power? Back to the contractor, how much power do I have as an employer, when there are 50 potential employers (customers) in my area and 100 potential employees (contractors); or, turn the figures around, so more jobs than workers? Suppose we have 50 employers and 100 employees, and 99 of the employees have decided to demand $100/hr for work, but 1 employee decides to demand $50/hr for work. Doesn't the 1 employee have a lot more power? But that power doesn't come just from his unique technical skills. Or, to consider the matter from the other perspective, suppose 49 employers are unwilling to pay $100/hr and 1 employer is willing; then doesn't that one employer have a lot of power?

Once you throw in this undefined concept of "power", then that reduces the notion of "exploitation" even further to the nonsense that it is.

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  • 3 weeks later...

Rand did address unions briefly in both The Fountainhead and Atlas Shrugged. In The Fountainhead, Austin Heller writes in support of a strike, saying that if everything is voluntary, workers may strike (provided they don't violate the businessman's rights), and the businessman may hire scabs. In Atlas Shrugged, Rearden's union had a good relationship with Rearden, because they got only the most qualified workers and simply desired wages that were representative of their high skills, as opposed to the skills of the average person.

I think the important thing to take away from them is that unionization is not categorically wrong. Employers can sometimes leverage individual workers, particularly when they have limited or specialized skills, or little other opportunity (mining towns, for example). It is appropriate for workers to refuse to work under wages they consider too low, or in poor conditions. Even if most workers feel this way, without unionization, the number that refuse to work will tend to be very small, and the business can go on as usual. The coal mining union knowingly pushed for higher wages, despite its awareness of the unemployment it would bring, because they felt it was more appropriate to send machinery into the mines than people. Individuals in a coal-mining company town would not have been able to make this change without organizing. Presumably, any person who wanted to go into the mines without those union-initiated protections would have been able to do so.

That said, unions are not categorically right - they do lots of destructive things, from prohibitions on firing disruptive and unproductive workers to forcing others into unemployment by setting minimum wages, absurdly high wages, and nonsense work rules, to destroying property on strike, to abandoning their contractual obligations, etc. The UAW, ILWU, and NEA come to mind immediately.

Any judgment on unions ought not to "package deal" them. I think the role of unions is minimal, all in all, but not zero.

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While there was some organization of labor as far back as the 1700's, I think, unions didn't really hit their stride and garner government backing until the early 20th century as part of the progressive movement. As with most of the bad things in the country you can thank Woodrow Wilson.

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Unions have existed in some form for hundreds of years, initially as guilds which restricted labor with apprenticeship rules, licensing, a semi-caste system, and so on. "Modern" unionization I think came out of the Industrial Revolution (reference the strikes of the late 19th century). Also, "progressives" took off under Teddy Roosevelt more than Wilson I think. Let's keep in mind Wilson was against tariffs, making him at least somewhat in favor of free trade. In terms of sheer wrongdoing, I'd have to single out FDR.

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Unions aren't a bad deal. Unions using government as a club to clobber businessmen is a bad deal, but unions certainly have their place.

For example, in an ideal Capitalist society, remember, government regulatory bodies would not exist (see also: OSHA). Sure, it's in the best interest of a businessman to keep his factory in safe working conditions. But having his men organized amongst themselves (and maybe with other men who do similar work in other factories) provides a means to understand safety issues and to bargain for the alleviation of some elements of danger. There are arguments to be made from efficiency as well...

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...men organized amongst themselves (and maybe with other men who do similar work in other factories) provides a means to understand safety issues and to bargain for the alleviation of some elements of danger. There are arguments to be made from efficiency as well...
It may sound great, but it does not work that way. By their nature, unions end up catering to the mass of workers to the detriment of the better workers. One can see this not only in labor unions but also in organizations like the American medical Association (AMA) or various industry organizations. Groups like that end up enacting rules and making deals with others which inhibit those among their members who want to try new things and to perform better than average.
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It may sound great, but it does not work that way. By their nature, unions end up catering to the mass of workers to the detriment of the better workers. One can see this not only in labor unions but also in organizations like the American medical Association (AMA) or various industry organizations. Groups like that end up enacting rules and making deals with others which inhibit those among their members who want to try new things and to perform better than average.

In a Capitalist society, those "better workers" would be free to pursue greatness down whatever avenue they find or make for themselves. No union as such could or would have the power to stop them. If a businessman decides that his factory will be all union, and that all men will work to a quota and not beyond, then it's not the union itself that limits the innovator, but the businessman who adopts that policy. The union would make for a loud, unified voice in dealings with the businessman... it doesn't follow that it would exist to crush the Stakhanovs or whatever...

Do you see something inherently bad about members of a large group having a unified, represented voice, or a dedicated advocate?

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Unions aren't a bad deal. Unions using government as a club to clobber businessmen is a bad deal, but unions certainly have their place.

For example, in an ideal Capitalist society, remember, government regulatory bodies would not exist (see also: OSHA). Sure, it's in the best interest of a businessman to keep his factory in safe working conditions. But having his men organized amongst themselves (and maybe with other men who do similar work in other factories) provides a means to understand safety issues and to bargain for the alleviation of some elements of danger. There are arguments to be made from efficiency as well...

Unionism falls apart when you take away the coercive element. Your example of understanding safety issues might have held true in the past, but information technology makes it simple to get the word out widely on safety risks involved with industries and particular workplaces. OSHA would be replaced by safejob.org, or some other organization providing this info for fee (I made that up, but it happens to be a site that does something similar today, though publicly funded). The bargaining to alleviate some elements of danger would take place at wage negotiations, where the individual would weigh the risk against the benefits and require higher pay for more dangerous jobs. The employer would weigh the higher cost of labor against the cost of eliminating dangers and choose accordingly. As long as the dangers are well understood and communicated, this is the most efficient way to make those decisions. If the employer hides risks from employees, then he is committing fraud. Once discovered, the legal system can extract compensation after the fact.

As SN points out, the only time that unions can have any effect, without coercion, is when the higher value workers are willing to sacrifice some of their benefit to lower value workers. The effect would be similar if those high-value workers simply gave some of their wages to low-value workers. The difference is that with unionism, high-value workers become average-value workers when their wages are limited to the average, and overall productivity, profitability, employment and wealth are all reduced for all levels of worker.

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Unionism falls apart when you take away the coercive element. Your example of understanding safety issues might have held true in the past, but information technology makes it simple to get the word out widely on safety risks involved with industries and particular workplaces. OSHA would be replaced by safejob.org, or some other organization providing this info for fee (I made that up, but it happens to be a site that does something similar today, though publicly funded). The bargaining to alleviate some elements of danger would take place at wage negotiations, where the individual would weigh the risk against the benefits and require higher pay for more dangerous jobs. The employer would weigh the higher cost of labor against the cost of eliminating dangers and choose accordingly. As long as the dangers are well understood and communicated, this is the most efficient way to make those decisions. If the employer hides risks from employees, then he is committing fraud. Once discovered, the legal system can extract compensation after the fact.

As SN points out, the only time that unions can have any effect, without coercion, is when the higher value workers are willing to sacrifice some of their benefit to lower value workers. The effect would be similar if those high-value workers simply gave some of their wages to low-value workers. The difference is that with unionism, high-value workers become average-value workers when their wages are limited to the average, and overall productivity, profitability, employment and wealth are all reduced for all levels of worker.

Let's assume for the moment that this were true. So what? Is it your contention that the right to assemble freely should be abridged?

Speaking to efficiency... what would safejob.org (or whatever) do that a union couldn't?

Do you see no utility in having workers organized such that they have a means of settling problems amongst themselves?

What are your thoughts on the "white collar vs. blue collar" mentality that tends to arise in workers - irrational as it may be - when they perceive the businessman as a tyrant -- and do you see the union as having no impact on that?

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What are your thoughts on the "white collar vs. blue collar" mentality that tends to arise in workers - irrational as it may be - when they perceive the businessman as a tyrant -- and do you see the union as having no impact on that?

If anything unions do their best to actually inculcate that mentality.

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In a Capitalist society, those "better workers" would be free to pursue greatness down whatever avenue they find or make for themselves. No union as such could or would have the power to stop them. If a businessman decides that his factory will be all union, and that all men will work to a quota and not beyond, then it's not the union itself that limits the innovator, but the businessman who adopts that policy.
Unions would definitely be legal. No argument there. You're right that a businessman who allows a union in his firm would have himself to blame. It is hard to speculate as to how things would evolve. However, if we look at history, our best guess is that most businesses would refuse to negotiate with collectives, and that not enough workers would unite to ensure that the businessman was forced to deal with their collective. Unions came into being largely because they used coercion on their employers and on other employees (often legal coercion of law). one might still have unions, but I would speculate we'd have far less than what we have today. This is particularly so in light of what people have seen as to how unions turn out.

Do you see something inherently bad about members of a large group having a unified, represented voice, or a dedicated advocate?
It is false to think that the interest of a bad worker and a good worker are common, and that they are at variance with the interest of the employer. So, while I see nothing "inherently bad" in what you describe, the problem is that they unite workers, rather than unite people with a common interest. This is the essence of why they have turned out badly. in reality, the interests of good employers and good employees are aligned, and opposed to the typically-articulated interests of bad employees.

The same with the AMA. The interests of good doctors and bad doctors are not aligned.

Now, if we were not talking about a union (which generally tries to work to some average common good of the majority of its voters) and were talking about an association around some clearly articulated and objective goal, which is actually in the interest of all its members, then forming a group like that would make sense. Even here, in a modern economy, specialized businesses often arise to meet some valid narrow purposes that were once fulfilled by unions. So, for instance, one does not need a union of people to pool resources to cover life-insurance, one can have a specialized life-insurance company.

Here are two recent union-related news articles.

Edited by softwareNerd
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Let's assume for the moment that this were true. So what? Is it your contention that the right to assemble freely should be abridged?

Speaking to efficiency... what would safejob.org (or whatever) do that a union couldn't?

Do you see no utility in having workers organized such that they have a means of settling problems amongst themselves?

What are your thoughts on the "white collar vs. blue collar" mentality that tends to arise in workers - irrational as it may be - when they perceive the businessman as a tyrant -- and do you see the union as having no impact on that?

The premise of abridging the right to freely assemble is faulty from the beginning, Jas0n.

First of all, unions restrict freedom, they don't give it.

My wife is in a union, by their force. She is not allowed to do the work she does without joining the union. Either join or switch careers. 5% of her wages are taken from her by the union and used basically to support political candidates she does not agree with and pay for benefits for people less skilled than her.

Secondly, lets say an employer fires anyone who wants to form a union.

This is still not abridging the right to assemble. A business is private property. The business owner gets to decide who gets to be present. The workers are free to do whatever they want outside of work.

Why on earth would a business person allow such a destructive force into their situation?

It was already mentioned that unions can only operate by force- this is why places with a choice to join the union or not no longer really exist. Once the union gets in it's join or be fired. The exception tends to be (another job my wife held) was you could choose not to join the union but you still had to pay the union dues, you just didn't get to vote.

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