Tuesday, August 16, 2011

Why Unions Should be Supported by the Government

For roughly the last 500+ years, ever since the Golden Age of the Dutch Republic, just to pick a starting point, Western civilization has created laws and institutions to make it easier for capitalists to combine and coordinate their money through corporations.

When a lot of money is collected into a single entity, like a corporation, that entity has an excellent bargaining position in negotiating wage agreements with individual workers. Since most individual workers are much more replaceable than that big wad of capital that we have legally enshrined as a corporation, the corporation ends up negotiating a really good deal for itself when it can negotiate with workers one-by-one. The modern economy is very much a team effort where we all depend on everyone else to hold up their end, but most of the money ends up going to the capitalists, because they combine with each other while workers, operating as individuals, end up in competition with each other. And, as I said, we've spent 500 years crafting laws and building institutions to make it easy for capitalists to combine their efforts.

Which is why it is very appropriate for the government to pass and enforce laws that make it easy for workers to combine and negotiate as a group when they're negotiating with corporations. These combinations of workers are called unions, and they are really one of the few ways that you can level the playing field between workers and corporations.

Back in the glory days of the New Deal, when the Federal government actively supported unions (and taxed the rich, by the way) we had a distribution of income in this country where the middle class actually received most of the income in the nation. There was a class of rich people, but as a group they didn't receive most of the wealth. They just received more, as individuals, than middle class people received as individuals.

But America has abandoned unions (and abandoned taxes on the rich) and now the American middle class as we knew it is wrecked, and most of the income goes, year after year, to people who already have most of the income. Because that, kids, is how the free market works.

And that's why unions should be supported by the government. I'm not saying that unions were or are perfect, or that there aren't reforms and improvements in unions that we should demand. But without unions we will never again have the America where I grew up, the America built around middle-class people who were proud to work for a living and who made a good living by working for a living.