Uncurbed Union Power

May 4, 1959

Congress is now debating a labor bill which is irrelevant to the real crisis in labor today. If enacted in the form in which it came out of the Senate committee, it could only intensify that crisis. For this bill proposes an unpromising method of curbing misuse or embezzlement of union funds by union leaders, and does nothing whatever to curb the privileged monopoly of unions, their resort to intimidation and violence, and their power to paralyze production until their demands are met.

Yet while the great majority in Congress still seem blind to these problems, there has been increasing recognition of them in the academic world. This was evidenced by the appearance two years ago of The Labor Policy of the Free Society, by Prof. Sylvester Petro of New York University, and by the appearance a year ago of a symposium, Labor Unions and Public Policy, containing contributions by Dean Roscoe Pound, Profs. Edward H. Chamberlin and Philip D. Bradley, and by Gerard D. Reilly.

It is evidenced now by the appearance of two more books. Again one of them is a symposium, The PublicStake in Union Power, edited by Philip D. Bradley (University of Virginia Press), and containing lectures delivered at the University of Virginia by sixteen different writers, including such eminent economists as Profs. E.H. Chamberlin, Frank H. Knight, F.A. Hayek, Gottfried Haberler, and David McCord Wright. And again one is a book by Professor Petro, Power Unlimited—The Corruption of Union Leadership (Ronald Press, $5).

NAÏVE ASSUMPTION

It would be unfair and impossible to attempt to summarize in this limited space the diverse views of sixteen independent economists. Yet there has obviously been a profound change since the days, 25 years ago, when it was naïvely assumed both in academic and in political circles that labor unions could do no wrong, and that the main if not the sufficient solution of the whole problem was to encourage bigger and stronger unions. As a result the government itself was in effect put into the union-organizing business, and employers were forced to “bargain” with unions set up by government-controlled processes.

Now we find an outstanding economist like Frank H. Knight writing: “‘Bargaining’ is a misleading, essentially dishonest use of a word. . . . What ‘collective bargaining’ obviously means in our case is simply monopolistic action on the part of a labor union. And the union, like any other seller, can secure a price above the free-competitive level only by arbitrarily restricting the quantity offered for sale, obstructing access to work in the union’s jurisdiction.” And F.A. Hayek writes that unions “have become what they are largely in consequence of the grant, by legislation and jurisdiction, of unique privileges which no other association or individuals enjoy. They are the one institution where government has signally failed in its first task, that of preventing coercion of men by other men—and by coercion I do not mean primarily the coercion of employers but the coercion of workers by their fellow workers.”

MCCLELLAN RECORD

These abstract statements receive overwhelming documentation in the Petro book. Petro has performed the herculean task of working his way through the 40 volumes which make up the record of the McClellan Senate committee, and has arranged, summarized, and interpreted the results. It is an appalling record of corruption and violence, ranging from the embezzlements of the Becks to the mass violence (in the Kohler strike, for example) engineered, authorized, and financed, but piously deplored, by the Reuthers.

Few men are better qualified to summarize this record than Petro, who, though now a professor of law, worked in the steel mills as a youth and took an active part in the CIO’s organization drive in the mid-1930s. In addition to presenting the facts, he has presented his own recommendations for corrective legislation and law enforcement.

If every congressman could be persuaded to read this absorbing and powerful book, Congress would certainly adopt a vastly different law revision from that proposed in the original Kennedy-Ervin bill.