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Labor Unions Prolonged Depression

Mike

Well-known member
Labor Unions Prolonged the Depression
wsj.com ^ | OCTOBER 28, 2008 | MARK MIX


As Amity Shlaes observed in her recent history of the Great Depression, "The Forgotten Man," within a few months after the Wagner Act was upheld, industrial production began to plummet and "the jobs started to disappear, with unemployment moving back to 1931 levels," even as the number of workers under union control was "growing astoundingly."

Given the reality of unions in the workplace, the law meant that efficiency and profitability were compromised, by forcing employers to equally reward their most productive and least productive employees. Therefore subsequent wage increases for some workers led to widespread job losses.

Pre-Depression-era growth and prosperity did not return to the private sector until the early 1950s, when the spread of state right-to-work laws prohibiting forced union membership and dues greatly reduced the detrimental effects of the Wagner Act.

The U.S. has just experienced another stock market crash, and Barack Obama, the candidate now favored to be the next president, is in favor of what amounts to a new Wagner Act.

If the mislabeled "Employee Free Choice Act," becomes law, it will likely have a similar effect on the economy as the original Wagner Act, transforming what could have been a recovery into a lengthy, deep recession, or worse.

The bill would greatly facilitate organization in workplaces by effectively eliminating secret ballot elections, allowing unions to become exclusive bargaining agents when a majority of the workers sign a card indicating they want a union -- before they've heard a word from their employer about the potential downside of unionization. ....

"I owe those unions," Mr. Obama explained in his 2006 political memoir, "The Audacity of Hope." "When their leaders call, I do my best to call them back right away. I don't consider this corrupting in any way . . ."


(Excerpt) Read more at online.wsj.com ...
 
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