Second Follow-up on Vulgar Liberalism: More on Labor Unions

In "Follow-Up: Vulgar Liberalism Watch," I pointed to several libertarian blog posts as evidence that not all free market advocates share the vulgar libertarians' employer-skewed scenario of free labor markets, and that some are even quite union-friendly. Now Ian Bertram of Panchromatica points me to this:

It may be of course that the ASI is really saying that employers should be able to hire and fire for any reason whatsoever without those fired having any remedy. If we accept this for the sake of argument, what would be the implications of such a radical approach?


First of all we need also to assume a completely free market in labour, with employers and employees able to seek whatever terms they wish and to negotiate with each other about those terms. It seems likely that employers would use agents to carry out the negotiations since the CEO of a company is not going to want to have to constantly negotiate with each and every worker directly. These agents would probably be directly employed since the work would be ongoing, although it presumably could be outsourced as is frequently the case with accounting services.


On the employee side they would presumably also want to employ someone to negotiate on their behalf. After all their normal working skills are unlikely to include the skills needed for negotiations, (although I suppose some workers could develop those skills over time and with extra training and may wish to move into this area, thus allowing for 'upskilling' in the labour force). Inevitably this will not be by direct employment, but through some form of agent. Over time, economies of scale and the workings of the market are likely to lead to these agents combining into larger units much as other businesses do. Some will be more successful than others and will therefore gain more business. Some may diversify into areas other than simple wage negotiations and into areas such as holidays, pension benefits etc.


Over time, relationships between employers and employees agents would begin to to stabilise into formal agreements, with contracts setting out terms of employment for a defined period.


Hang on - this is beginning to sound very familiar! Isn't this a trade union?

I would add that, in a free labor market, what's good for the gander is good for the goose. If employers are free to refuse or withdraw employment for any reason or no reason, then workers are likewise free to withdraw their labor for any or no reason. That means that, in the absence of a freely negotiated contract, workers are free to engage in secondary sympathy or boycott strikes. Teamsters and longshoremen are free to refuse to handle scab cargo. The Railway Labor Relations Act and Taft-Hartley are out the window.


The great CIO organizing strikes of the early '30s, remember, were won before the Wagner Act passed. They were won by non-government-certified unions, without any union-shop contract clause to help them. The union membership was created, in other words, by the very act of striking. Paid union membership in a plant might be just a few percent, until a flying squadron announced a walkout--at which the entire labor force joined by voting with its feet. I suggest it might actually be easier to organize disgruntled workers by such means, in hot blood, than to get them to jump in cold blood through all the hoops of the NLRB certification process.


And those early industrial union victories were won by strategic leadership planning strikes the way a general staff plans a military campaign. The successful strikes involved multiple echelons of defense, with strikes at every stage in the production process. In some cases, the support of transport workers turned them into regional general strikes. The whole body of labor legislation, with Taft-Hartley and the various transport labor relations acts at its heart, was created to outlaw just such a successful strategy. The object of corporate liberal legislation was to domesticate the labor revolution of the early '30s, and to place the rank-and-file under the firm supervision of union bureaucrats at the local plant level.


As Ian said, it was the employers who wanted to bring contract and predictability into the process. My guess is that, without Taft-Hartley and Wagner, they might well again be begging for the kind of stability that a union contract provides. As I recall, one of the reasons that Gerard Swope and like-minded employers favored industrial unionism in the '30s was precisely that they were so much easier to deal with than a whole gaggle of craft unions, any one of which could disrupt production unpredictably. In other words, the industrial union could potentially solve the same problem that earlier attempts at company unions were intended to solve. The leadership of an industrial union, if given the government-backed power to suppress wildcats and enforce contracts, was a handy tool for labor discipline.


I'll take it one step further. I suspect that labor relations are potentially a case of asymmetric warfare. That is, in a situation of labor war, the cost and risk to the workers of circumventing management surveillance and control will be a fraction of the cost to the employer of implementing it. It's a lot like the old offensive-defensive arms race in the days of ballistic missile defense, when offensive counter-measures were a lot cheaper than the defenses.


For example, if you think about it, you can probably think of a hundred ways to raise costs and reduce effiency on your job, with virtually no chance of getting caught. Many of them, like working to rule, are nothing more than glorified passive-aggression.


Another example: the authors of the Cluetrain Manifesto argue that unauthorized communication between workers and customers is, contrary to the assumptions of clueless management, the best promotional tool a company can have. What they neglected to mention is that, when workers are disgruntled, telling customers the truth about the company is the best way to break it. In the absence of unions, the workers' only real bargaining leverage may be the customer's favorable image of the company. For the customer to see the worker as his ally and the company management as their common enemy is the bosses' worst nightmare. "Open mouth sabotage" is just another form of the "swarming" that so alarmed David Ronfeldt et al in their work on "netwar." In this age of networked activism, it's possible for disgruntled employees, through a campaign of emails, letters, phone calls, discussion board posts, and anonymous websites, to totally overwhelm their employers with negative publicity.


Lane Kirkland once suggested, only half-heartedly, that he was tempted to seek a repeal of all labor legislation since Norris-LaGuardia (which simply took federal militias and courts out of labor disputes). He speculated that, if labor and management were allowed fight it out with all the weapons at their disposal in a free market, labor would do better than under the present regime. I suspect he was right. After all, as the slogan goes, all we have to do is fold our arms, and we can bring their world to a stop.