I'm looking for information about the Austrian view of labor unions. Any help would be appreciated. Thanks.
"It does not require a majority to prevail, but rather an irate, tireless minority keen to set brush fires in people's minds. " -- Samuel Adams.
Philosophic view or economic view?
"The plans differ; the planners are all alike"
-Bastiat
economic
A cartel is a group of firms that collude to restrict their output of goods to raise their prices. A labour union is based on the same principle.
They do two things that restrict supply:
1. They lobby the government to restrict new entrants into the market (through licencing laws)
2. They strike (ie reduce their output) in order to extort a higher price (wage) for their labour.
Irish Liberty Forum
I'm certainly not pro-Union, but we have to also recognize that Unions can be a product of the right to voluntarily associate..
kingmonkey: I'm looking for information about the Austrian view of labor unions. Any help would be appreciated. Thanks.
This isn't necessarily the Austrian view, but it's my personal view.
In the late 19th century and early 20th century, workers formed unions as a response to abuses in factories. These unions were unregulated and effective.
The Taft-Hartley act regulated unions, which neutered their effectiveness. Union leaders became State bureaucrats instead of true workers' advocates. (See elsewhere for discussion of the Wobblies vs. AFL-CIO. The Wobblies refused to submit to regulation, but the AFL-CIO embraced the regulations. This made the AFL-CIO a corporate bureaucracy. The leaders of the Wobblies were "terrorists" and they were stampted out.)
In a true free market, unions are unnecessary. Workers who feel mistreated would just start their own competing businesses.
Unions evolved to patch up symptoms of a corrupt system. State regulation of unions cripples unions.
I have my own blog at FSK's Guide to Reality. Let me know if you like it.
liberty student: I'm certainly not pro-Union, but we have to also recognize that Unions can be a product of the right to voluntarily associate..
There is the right to associate as in voluntarily joining a club, or joining the an orgainzation like the Automobile Association, but what most Unions do is insist that only they can negotiate with the employer, and only members of their Union can carry out particular job functions. This is effectively forced association and therefore not compatible with liberty.
Remnant: There is the right to associate as in voluntarily joining a club, or joining the an orgainzation like the Automobile Association, but what most Unions do is insist that only they can negotiate with the employer, and only members of their Union can carry out particular job functions. This is effectively forced association and therefore not compatible with liberty.
There's another point I forgot to mention. There's the "closed shop" law. A union may, as part of its contract, require all employees in certain roles to be members of the union. Employees are barred from negotiating individual agreements with their employer.
Via the "closed shop" law, unions become advocates for the employer's needs! The employer only needs to offer least-common-denominator working conditions, rather than negotiating separately with everyone. For example, a really skilled unionized worker can't ask for 10%-20% higher salary.
MatthewWilliam:They strike (ie reduce their output) in order to extort a higher price (wage) for their labour.
Byzantine:But the union only exists in the first place because there's a federal law that requires employers to engage in collective bargaining once the majority of employees vote to organize. I agree that company unions and guilds would not be unheard of in a free market, but that is not the situation under the NLRA.
I agree that company unions and guilds would not be unheard of in a free market, but that is not the situation under the NLRA.
Well, yeah, I agree, today's unions under today's laws can be extortion rackets, as much for those they "represent" as their employers, but I was speaking of unions more generally. The way the post I responded to put it was that unions, in general, were cartels that extorted employers. That's the way I read it, anyway. I saw it as hyperbole, a bit too typical of those who lean right.
Byzantine:Out of curiosity, would you also recognize the right of employers in a particular locale to get together and agree on the wages they would pay?
Absolutely.
Byzantine:Of course, such attempts at cartelization would fail as soon as demand for labor exceeded supply and this, by the same token, is why it is hard to imagine unions in a truly free labor market.
I think they would actually end up more like guilds. We think in terms of employers and employees based on the corporatist model, not the true free market where one individual deals with another. Your employer would not be your boss, but your customer, in a true free market. The paternalistic sort of business model we currently operate under is silly and very unanarchistic. Guilds would serve not only as a protector of the interests of the employee, but an assurance of quality to the employer.
From an economic point of view, labor unions simply create wage rigidities which create unemployment. Employers should be given full power to bust unions.
Political Atheists Blog
JCFolsom: I don't think it's really fair to call union strikes extortion. It's collective bargaining. They can get a higher price (or what have you) if they all demand it together than if they do so individually. Unlike with an actual extortion, the employer can choose not to pay, they just won't have workers. However, this does not constitute the force or threat of force extortion implies. The workers do not threaten to harm the employers, just not to help them. Different, see?
I am afraid that extortion is the right word. Any worker can choose not to work, but what the union demands is that the those workers have the right to withold their labour and that the employer does not have the right to employ anyone else.
So with the protective labour laws, the employer can choose not to pay if he prepared to go bust! Not much of a choice. The workers do not threaten to harm the employer? Not true, they are threatening to bankrupt him. What is more is that the striking workers do often threaten and indeed do beat up other workers do not follow the unions instructions and carry on working.
Collective bargaining is Orwell speak for violence and intimidation.
Going back to the original topic.
Unions could and likely would exist in an "Austrian" society, but certainly not in the form that they do now. All Federal and State labor laws would have to be repealed. Unions would be totally voluntary. The employer could choose to recognize or not recognize the union as a bargaining agent. The employer could choose to bargain or not to bargain with the union. The employees of the company could choose to join the union and attempt to collectively bargain or choose NOT to join the union and instead bargain directly with their employer. The employer would be free to fire employees for striking. Certainly, a group of employees has the RIGHT to associate in a union. At the same time, the employer has the RIGHT not to associate or interact with that union.
Remnant:I am afraid that extortion is the right word. Any worker can choose not to work, but what the union demands is that the those workers have the right to withold their labour and that the employer does not have the right to employ anyone else. So with the protective labour laws, the employer can choose not to pay if he prepared to go bust! Not much of a choice. The workers do not threaten to harm the employer? Not true, they are threatening to bankrupt him. What is more is that the striking workers do often threaten and indeed do beat up other workers do not follow the unions instructions and carry on working. Collective bargaining is Orwell speak for violence and intimidation.
Under the current work environment, regulatory agencies and corporatism restrict employment choices, harming workers far more than unions harm employers. The law works both ways, and in most ways in favor of large, grotesque artificial legal entities known as corporations. That being said, once corporatism is done away with, an employer should be able to make employment decisions as suit them. A union ought only be successful in striking if there are not enough available workers to replace those striking. It is the legal environment, not the existence of unions themselves, which bring about the extortion aspect. However, as I said before, these laws are not necessary for unions to operate, especially among skilled workers who are inherently difficult to replace in large groups.
An employer unwilling or unable to pay what the workers in a particular field collectively demand will not be able to gain or retain employees. They will go out of business. I don't see anything wrong with that.
Remnant: So with the protective labour laws, the employer can choose not to pay if he prepared to go bust! Not much of a choice. The workers do not threaten to harm the employer? Not true, they are threatening to bankrupt him. What is more is that the striking workers do often threaten and indeed do beat up other workers do not follow the unions instructions and carry on working. Collective bargaining is Orwell speak for violence and intimidation.
Talking about unions in these terms is missing the true point.
Why can't I start my own monetary system and bust the Federal Reserve's monetary monopoly?
Why can't I start my own car manufacturing business and bust GM/Ford/UAW's monopoly? The reason there have been no new car manufacturers for awhile is that the industry is *HEAVILY* regulated.
You can't talk about abuse of unions unless you also address the abuses that make it hard for individuals to start businesses.
fsk:In the late 19th century and early 20th century, workers formed unions as a response to abuses in factories. These unions were unregulated and effective.
These unions were actually very ineffective. Unions were practically powerless until they got government backing.
They also were criminal enterprises. Unions were practicioners of private crime, until they enlisted the government to commit their violence for them.
Peace
Torsten:That is about the same thing then threaten to fire, not promote or blacklist certain workers. So I guess the 'bankrupting' mechanism works both ways.
I think we need to go back to the principle of Property Rights. A company is the property of its owner, not the employees. The owner should be able to choose with whom he wants toa associate with on his property, including to fire, not promote or blacklist certain workers. However, pure discrimation is bad for business should the business owner chose less capable staff over more capable workers of a colour he does not like.
Remnant:I think we need to go back to the principle of Property Rights. A company is the property of its owner, not the employees. The owner should be able to choose with whom he wants toa associate with on his property, including to fire, not promote or blacklist certain workers. However, pure discrimation is bad for business should the business owner chose less capable staff over more capable workers of a colour he does not like.
As I read this, I could imagine the veins bulging on the foreheads of the Leftist Carsonites.
Again, we come to this fallacy, this illusion, that a company is a thing, rather than an activity and a continuous choice. A person has the right, of course, to freely choose who he associates with in business. However, you can only choose from what's available, and if the workers available all agree to only accept a certain minimum of compensation, you'll just have to pay them what they ask or find some alternative. They are fully within their rights to do so. I don't really see how your point has anything to do with the discussion.
If you are trying to make an argument for the current situation, rather than in general, your argument again fails. You can't demand that workers not use the force of law to maintain standards for themselves when you use the force of law to create artificial corporate entities that can sue and be sued, have ownership rights, create fictional shares of their fictional selves to raise revenue, go into debt, and protect you from liability. Your workers' compensation laws protect you if your minimal safety precautions fail.
When you operate without taking advantage of anything outside of the truly free market, then you can whine about unions. Until then, they're just doing an inadequate job of leveling the playing field.
I think what he meant, was that company = capital, the capital (aka the company) is the property of the owner, not the shared collective property of the workers. I think that's what he meant.
Torsten: Remnant:I think we need to go back to the principle of Property Rights. A company is the property of its owner, not the employees. The owner should be able to choose with whom he wants toa associate with on his property, including to fire, not promote or blacklist certain workers. However, pure discrimation is bad for business should the business owner chose less capable staff over more capable workers of a colour he does not like.That's right and we should also not forget that the bodies of laborers, their capacity to labor is the property of the workers and not the company it's owners or the managers. So if they chose to withhold their labor, in order to bargain for better wages or conditions that should be fine as long as they do not initiate violence. Don't you agree?
JonBostwick: These unions were actually very ineffective. Unions were practically powerless until they got government backing.
And even then, they were inefective. Take, for example, Cesar Chavez's United Farm Workers. They spent years trying to get their demands met through strikes. This failed miserably. Then they got governemnt to intervene on their behalf. This also failed to improve situations. Finally, they realized what Mises had been saying for decades: The consumer is god. They took their case the the consumers, and the consumers forced the orchard owners to meet the UFW's demands.
You can't take the sky from me.