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Article by Michael D. Hume, M.S.

Corruption In Big Labor Has Run Amok

by Michael D. Hume, M.S.

Imagine being a professional American actor in, say, 1880. Like it is in every time and place, the pro theater game was highly competitive – there were many more actors than there were paying jobs for actors. Some were lucky enough to be well-liked and positioned in a theater company in a big city… others weren’t. Some very talented performers were forced either to get other jobs, or, if dedicated to their craft, sign on with traveling troupes who toured out-of-town, often in the Wild West.

Some of the entrepreneurs who ran these troupes were ethical, fair-minded professionals. Many weren’t. It was not uncommon for traveling performers to suffer “horror stories” – being left penniless and unemployable in a strange town far from home… suffering horrible medical calamities and being jettisoned from the company… even being abused by their “owners” physically, sexually, and certainly mentally, with no recourse.

Eventually, the profession, like many others, found equity (literally) for actors in the form of a labor union that still exists today – Actor’s Equity. But ask a pro actor these days, and they’ll tell you that the market for their craft is, in many cities, “locked away” by the union. If you want to work at an “Equity house,” you have to find one that has a union opening (rare), then audition and beat-out others who may already be Equity members (very rare). If you get through those filters, you have to work a high number of hours in performing and other behind-the-scenes labor to get your Equity card. Once that happens, you can still lose your job the next time the theater changes its show offering… and the concessions Equity houses must make to the union that sanctions them often make it very difficult for them to provide much employment for very long. For that reason, many talented performers find it easier to avoid the union and move from theater to theater, working paid professional shows in non-Equity houses (once you’re an Equity actor, you can’t work in a non-Equity show; you lose your Equity job, congratulations, you’re now a waiter). And Equity houses – especially those not subsidized by some city’s “arts district” tax money – struggle much more to stay in business these days than do non-union companies. In fact: if you’re knowledgeable about the theatre business, can you name one that’s still going?

It’s hard enough to have the guts and talent to maintain a decent career as a stage actor these days. In 1880, we needed Actor’s Equity to make the profession fair, and to protect performers from unscrupulous owners. Do we still need the union today, to protect us from easier employment? No doubt we could see a return of unfair theatrical employers, so having a union is still a good idea. But when the union “outgrows” its usefulness (and Actor’s Equity is far from the most egregious example), wouldn’t it be a good idea to prune it back a bit?

This is just one example. If you’re in a union job, you know what the deal is: you are compelled to join the union and pay dues – you have no choice. The dues supposedly go to help you sustain your rights in the workplace… but you know there is not much oversight given to how your dues money is really spent. Union bosses are employed full-time by the union, in many cases (not by the company), and you are, in many cases, paying those bosses a lot more than you make. And there’s still plenty of money left for the bosses (not you) to decide to contribute to the campaigns of politicians who will return favors.

If your company and your union are both strong in negotiation, you’ll get a fair shake, and the company will be able to survive. If a corrupt union gets the upper hand, though, you’ll be out of work at some point because they’ve “negotiated” too sweet a deal for the union (not necessarily for you), and the company will not be able to sustain its business. This has happened to the American auto industry, where unions levied unsustainable burdens on the companies while using tons of excess money to finance liberal Democratic elections. Once they collapsed the companies by preventing them from making and selling competitive products, the unions turned to their protectors in government (including the White House) and were promptly given complete control of those companies. The competitiveness of American automaking continued to decline, and the industry now must rely on government subsidies to survive. And that means government has to be bigger than it used to be… because Uncle Sam is now in the car making business.

America became great because it was founded on the principle of limited government. The people are supposed to be free to create a product, start a business, develop a market, compete in the marketplace, and build lasting wealth for themselves, their employees, and their communities. It’s worked great. Labor unions have, for much of American history, provided a necessary and desirable check-and-balance on the possibility of unethical entrepreneurship… but lately, they’ve grown beyond that mission to become a sort of arm of the big-and-growing government. And there is NO check-and-balance on the corrupt growth of Big Labor.

It’s become a circular, self-propagating mess: you get a job… they force high dues out of you… they use the money as a hammer on your employer… they collapse the business while buying favor from the government… the government takes on the burden of caring for you and your colleagues… the “company” declines and must be subsidized by the government while the people who knew how to run it as a private concern are forced out… and the government raises taxes to fund their new responsibilities. The government ends up bigger. You end up stuck paying high union dues (and high taxes) to keep your inflated job, and you are constrained in your work such that you couldn’t make a great product if you wanted to. Worse: you end up unemployed, because the union drove the company out of business. (In that case, the government has to grow again, raising taxes on everyone to pay your 99 weeks of unemployment). America ends up forfeiting its free-market strength and mired in the sort of socialism that’s ruined every other democratic nation. And the union agitators are off down the road, looking for another industry to consume.

Your job could be next. Your company could be next. Your industry could be the next one to be swallowed up and assimilated by the union/government “Borg,” and resistance does seem futile. Ask yourself this: if you make 20 percent more than you would without your union… but your company is ransacked while you pay 20 percent more than you otherwise would in dues and taxes… how is that a good idea? If you had a choice, you’d scrap the union and do better work for a stronger company for many more years… wouldn’t you? Today, most likely, you’d say yes. But the longer union corruption is allowed to run amok, the more workers they’ll suck into dependence… and there’s a real danger that the true entrepreneurial spirit that made America great is being “bred out” of our country.

There are at least seven limits on our government that we need to renew, from the amount of money government’s allowed to borrow and collect from us to the amount it’s allowed to spend… I’ve written about all of those limits in this series. Meanwhile, while we’re restoring our limited-government free republic, we should limit some of these quasi-governmental rackets that serve to undermine our freedoms – and Big Labor is chief among them. Corruption in Big Labor unions provide the liberal politician with his best and easiest opportunity to practice the sort of “crony capitalism” that’s recently brought down once-mighty American industries, and which is typified by scandals such as the Solyndra-centered “green energy” boondoggle currently being perpetrated.

You can limit Big Labor without limiting the freedom of the workers they purport to protect. The National Right To Work Act, which would stop unions from forcing you to join, would be a great start. Limiting the percentage of a firm’s overall revenue that can be collected in union dues would be another smart move – let the unions do their jobs by making sure the labor force is getting a fair shake, but don’t let them drive the company out of business (or out of private ownership). Limit the percentage of a union’s revenue that can be used to buy political favor… in good times, if the union’s accounts are flush, they should rebate money back to workers rather than contributing it to big-government candidates and causes (and any contributions outside the union should be voted on and approved by at least two-thirds of the union’s rank-and-file membership). Limit the salaries of union bosses to a percentage of the company’s profits, to provide them with the right motivations in negotiating with the ownership; in any case, union bosses should not make more than the average salary of their members. And term-limit union bosses to keep them from settling into cushy, no-work, high-salary positions while they gobble up companies and jobs.

One more thing: labor unions are an essential part of the private economy. But Calvin Coolidge was right – the public sector is no place for unions. You are either a public servant, or you aren’t. Public “service” should not be a permanent, comfy, unassailable lifestyle. If you want a union job, get one at a plant that makes and sells something society needs.

We can, and must, limit the runaway growth of corrupt labor unions in America. Workers should have the choice to organize, but not be forced to be bled by high dues and high taxes which go to ruin the very companies that employ them. Keep the unions… but limit them to the good and noble function for which they’re intended.

About the Author

Michael Hume is a speaker, writer, and consultant specializing in helping people enjoy health, wealth, and inspiring lives. Those who want to make money “one less thing to worry about” can learn more at http://tinyurl.com/myownbiznow – anyone wanting more vitality can browse http://shop.enivausa.com/239824 – visit Michael’s web site at http://michaelhume.net

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