The Effect of State Right-to-Work Laws on Unions - Essay Example

Labor unions are an essential economic, political and social force in the American society as well as in other industrialized nations across the globe. According to the figures made public by the U.S. Bureau of Labor Statistics, labor unions had registered 20 million members in 1974 (Hogler, 2004, 289) , which comprise a considerable portion of all nonagricultural workers. Despite of the importance of labor unions, trivial attempts has been done to explore their behavior as economic units, particularly from an empirical framework. The proclamation uttered by Melvin Reder almost a century ago is still relevant, “By comparison with the voluminous literature on the theories of the firm and consumer, the amount of space devoted to the theory of union is small indeed. This is not accidental; it results from the fact that the behavior of firms and consumers can be easily interpreted as maximizing while that of a union cannot” (ibid, 290). Certainly, since the statement of Reder, there is proof that curiosity and interest in unionism generally collapsed. Nevertheless, because of the significance of trade unions in the activities of the economy, there is a necessity for a systematic framework which can present theoretical concepts into the economic performance of unions to fill the empty spaces that presently exist. This research will attempt to analyze the effect of state right-to-work laws on the economic and political activities of union. I. Literature on Labor Union Economics As highlighted above, insignificant development has been made in shaping the performance of trade unions since the conventional economic paradigm assumes some form of making the best use of behavior by the entity being investigated. More particularly, the consumer is presupposed to take full advantage of utility, while the company is expected to maximize profit. Neither comparison is relevant to the trade union. Dunlop tried to formulate a framework of the union grounded on the assumption that the wage income of the members of a union is the revenue function and revenues is to be capitalized on rather than profits, as costs to the union are zero. On the contrary, some analysts believed labor unions as a generator of member services which should consider both the proceeds from membership fees and the costs related with the prerequisite of different stages of services. A correlation between an assumption of the consumer and the activities of labor unions has been designed by Cartter in that the union has an apathy plot which indicates its inclinations between the levels of wages and the level of service (Davis, 1993). In other words, traditional economic assumption demands that the economic player, such as business organization and consumer, takes advantage or a single-valued utility such as profits or function. When an economic unit exploits multiple objectives, the maximization setbacks become difficult, if not inflexible, for it is necessary to indicate the tradeoffs among the different objectives. Moreover, a number of the objectives may be conflicting and, in this instance, an upper limit cannot be reached. When the political aspect of labor unions is as well openly acknowledged, the dilemmas become progressively difficult, because of the intricacies intrinsic in indicating the goal function to be maximized (ibid, 52). For these justifications, no one has designed a paradigm which openly considers the various goals of the labor union. A great deal of the economic literature dedicated to the discussion of the right-to-work issue has been preoccupied with its impacts on the extent of unionization and membership in unions, such as the question, “do right-to-work laws matter?” There appears to be a common agreement that right-to-work laws have trivial impact on unionization. Hirsch comes to a conclusion nearly similar to Lumsden and Petersen assumption that “we align ourselves with prevailing suspicions that the battle for right-to-work laws is one of symbol rather than substance” (Gall, 1988, 48). These scholars are in conformity with the conclusions of Moore and Newman that the presence of “right-to-work laws is not a statistically significant determinant of differences among states in the proportion of the nonagricultural labor force unionized” (ibid, 49). Moore and Newman demonstrate that a lopsided estimation of the effect of right-to-work laws is reached unless a concurrent equation paradigm which considers the joint interaction between the extent of unionization and the presence of right-to-work laws is applied (Hogler, 2004). II. The Economic Repercussions of Right-to-Work for Local Unions Because of the intrinsic complexities involved in identifying the objective function of the local union as an economic unit, a distinct framework is used in this research to explore the economic repercussions of legislation influencing union protection such as right-to-work laws, for the local union. In order to fulfill this objective, the perspective of property rights will be used since, “The organization per se is no longer the central focus; rather, individuals are assumed to seek their own interests and to maximize utility subject to the limits established by the existing organizational structure” (Davis, 1993, 54). Instead of taking into account a business organization as the unit of investigation and supposing that the proprietor’s securities are given special attention, the function maximizing framework stresses individual adaptation to the economic environment and pursues to give details the performance of the business organization and other institutions through examining individual behaviors within the organization. In fact, a systematic basis is given for analyzing the relationship between the purposes of decision makers and the specific strategies employed to fulfill these purposes (Hogler, 2004). Basically, the property rights perspective focuses on the economic activities of the unit’s proprietors and its managers rather than on the unit itself as an economic unit. For the part of the local union, the proprietors are the union affiliates of the bargaining entity, whereas the managers are the authorities of the local union. Both proprietors and managers are believed to capitalize on function, but the intentions of the proprietors and managers are, in any rate to some extent, in conflict since, “managers can, at some cost, engage in discretionary behavior and divert a portion of the organization’s resources to their own ends. But by appropriating pecuniary and nonpecuniary benefits for themselves, the managers necessarily infringe on the interests of the owners (the individuals possessing ultimate authority) and must reckon with a greater or lesser reaction from the owners” (ibid, 291). In other words, in relation to the constituents of the bargaining unit, economic assumption reveals that the central dissimilarity between right-to-work and non-right-to-work contexts is that the demand trend for union services is descending in the former, but otherwise in the latter. This variation in the two kinds of economic contexts is of foremost consequence for the exploiting activities of the union manager (Davis, 1993). Hence, the activities of the union manager in a right-to-work condition will move away from that of the union manager in the non-right-to-work condition. It is fascinating that American unions condemn right-to-work legislation as an abomination despite of the reality that economic assumption indicates that the worker is better served under the protection of these laws. In the non-right-to-work condition, the union can force the worker to sustain its activities through the transfer of property privileges from the members of the staff to the local union. Under such conditions, the union manager is protected from the issue of choice embedded in the market processes and has privileges to give out fewer services of more mediocre quality at higher prices than in the circumstance in a right-to-work condition. Empirical researches of instances wherein the property rights of the proprietors of an economic unit have been satisfied and conveyed to the managers have specified identical economic behavior (Gall, 1988). III. Labor Legislation and Right to Work The story of the appearance of the right-to-work movement is as well the story of the changes in public opinions regarding labor relations since the 1930s. In the 1940s, the dilemma of union protection frustrated a restored labor movement. Even though the legislative improvements in labor law in the 1930s abandon the legal standing of union protection vague, the subject surfaced as a key point of controversy demanding legal explanation during World War II. Positive rulings awarding union protection by wartime organizations of the government went home to the AFL and CIO its significance; simultaneously, labor’s capability to protect it through government fiat motivated anti-labor sentiments and assisted launch a dynamic right-to-work movement. Afterwards, the strike surge of 1945-1946 and the preliminary organizing success of labor in the South quickly after the war amplified the attempt to cut down union protection, initially on the state level and afterwards through national legislation, concluding in the anti-union protection aspects of the Taft-Harley Act of June 1947 (Gall, 1988). The rival federations took action separately to these unwanted developments. The AFL emphasized state and local lobbying and legal court challenges, whereas CIO instigated into electoral activism; persisting competition, in addition to lack of prescience and structural insufficiencies in both federations, slowed down labor from accomplishing more and achieving further than halting right-to-work wave from swallowing up industrialized regions. By the concluding phase of the 1947, fourteen states, majority of them located in the South and Plains, had approved right-to-work laws, and the traditionalist Eightieth Congress successfully secured the law from a court challenge through awarding the states jurisdiction over the issue under the Taft-Harley Act. At the time of these struggles, labor endured thoroughly the complexities of trying to exercise privileged interest authority through its mounting association with the segmented Democratic Party (ibid, 201). Nonetheless, the failures the labor movement went through and the involvement that its various departments started to improve in the right-to-work disagreement facilitated the means for broadened political activity in the next decades. Unsurprisingly, organized labor’s frustration to abolish section 14(b) was merely temporarily diminished controversy over union protection legislation. The discussions persisted into the seventies, showing both a connection with the past and a growing inclination of the parties to segregate more cohesively on conflicting sides of the matter. After organized labor had recuperated adequately from the 14(b) disappointment, numerous state labor movements entered into the offensive in the middle of the seventies pursuing retraction or favorable revision, but the political environment became less favorable after 1976. On the part of the Democrats, how a prospective presidential candidate stood on the debate regarding repeal emerged ever more visible in intra-party power struggle during primary season. Heated discussions over right-to-work continued, in the national party politics and in the state legislatures alike, with the crush o0f the 1978 Labor Law Reform Bill appearing to define the induction of a progressively more conservative phase. It was in the vicinity of presidential politics that the subject matter drew on the most attention after the frustration of the section 14(b) movement (Gall, 1988). This analysis of organized labor’s response to the problem regarding right-to-work for over four decades intended at achieving two missions. Primarily, it aimed to contribute a general narrative history of the matter from the early forties through the latter part of the seventies at state and national levels alike; and interrelated, simultaneously to present, in microcosm, a reachable narrative of labor politics for the greater part of the post-World War II period. Second, and more significantly, an investigation of the AFL’s, CIO’s and AFL-CIO’s attempts to wrestle with this governmental offensive afforded a chance to describe with some distinctiveness the character of organized labor’s special interest effect within the setting of contemporary American party politics (Hogler, 2004). More specifically, an evaluation of the reactions of both parties in relation to the labor federations’ efforts to affect them offered a methodology to examine and assess the usefulness of labor’s political coalition with the Democratic Party on institutional matters of particular interest to labor. Provided with the individual collective responses of the parties, an impartial conclusion is that, even though overwhelmed by countless difficulties, the association between organized labor and Democratic Party gave an important channel through which the union leaders of America could exercise a considerable amount of particular interest influence (Davis, 1993). Whereas this influence obviously was not well-built enough to permit the labor movement’s political leaders to retreat inroads established in geographic regions of disadvantage and during times of strong public disappointment over union behavior, it did constantly and effectively function on a daily basis as a way of security. Prior to going into this assessment in some quantitative specification, it would be helpful initially to go over the main points of the primary structures of the politics of right to work. IV. Conclusion Right-to-work remains a contentious and questionable subject. Awaiting state and federal legislation handle the issue. This research establishes important correlations between right-to-work laws, unionization and the economy. It hence contributes to a greater understanding of the forces significant to policymaking. The period between 1943 and 1949 embraced both the development phase and the initial growth of the right-to-work movement, in addition to organized labor’s first response to the problem. Throughout World War II, organized labor lobbied for union protection in substitution for wage constraint and succeeded in acquiring it through government regulation. In a decision measured to outwit pro-labor policy makes at the federal level, traditional aspects instigated a movement at the state level to restrict, and expectantly retreat, these union protection gains. After widespread unsuccessful attempts in various state legislatures, anti-union protection advocates put up their first authority through winning public right-to-work referendums in 1944 and 1946 (Gall, 1988). Nowadays, arguing public advocacy, like-minded policymakers in nine states, taking action either to concern over prevalent labor activism at the aftermath of the war or the possible targeting of their area for union mobilizing efforts, claimed that the citizenry aimed at such legislation and managed to put identical limitations on their state’s law manuscripts in 1947 (ibid, 258). These events had a similar effect at the countrywide level, for when Congress took into account comprehensive reorganization of national labor relations regulation during the Taft-Hartley discussions in 1947, the traditionalist scholars of the amendments considered it significant to safeguard state anti-union protection restrictions through openly abandoning control over the subject to the states. References Anderson, N. (1938). The Right to Work. New York: Modern Age Books Inc. Davis, J. C. (1993). Right-to-Work Laws and Free Riding. Economic Inquiry , 52+. Gall, G. J. (1988). The Politics of Right to Work. New York: Greenwood Press. Hogler, R. (2004). Right-to-Work Laws and Business Environments: An Analysis of State Labor Policy. Journal of Managerial Issues , 289+. Moore, W. (1980). Membership and Wage Impact of Right-to-Work Laws. Journal of Labor Research , 349. Read More