September 28, 2023 | OPINION | By Zoraiz Zafar
Almost a hundred years ago, the booming auto industry, and the innovations derived from it, ushered the United States into an era of unprecedented prosperity: the roaring ’20s. Today, as prosperity declines in the country, the auto industry is being held captive by a power-hungry union boss looking to redeem the United Auto Workers’ tarnished reputation.
Shawn Fain, the current UAW President who recently took office after his last two predecessors were prosecuted and jailed for corruption, stands determined to lay down road spikes on the path to prosperity.
From a historical perspective, there are many cohesive arguments that could be made against overpowered union juggernauts. I could cite the example of the wave of organized crime unleashed by the Teamsters during the 1950s and 1960s. I could also cite how Jimmy Hoffa, the infamous Teamsters boss, used the union members’ pension funds to invest in his friends’ Las Vegas casinos. Not to mention the exorbitant union fees that are drawn out of the paychecks of hardworking blue-collar Americans every time they get paid.
But the key argument against the existence of large unions is one based in fundamental economic theory. You see, on an overarching level, labor is a good with an associated supply and demand.
Through the free market’s invisible hand, the price of labor, which we generally refer to as “wage,” is determined and a market equilibrium is reached. Unions seek to interfere in the free market’s operations by imposing price floors, which we generally refer to as “minimum wage,” above the previously established equilibrium. This, by definition, will lead to a decline in demand for labor, resulting in a reduction in the labor quantity purchased, a phenomenon known as unemployment.
Once again, history provides empirical evidence for this theoretical claim. Toward the end of the 20th century, Europe, a region where unionization was growing, saw unemployment skyrocket to double digits, whereas the U.S., undergoing a period of de-unionization, saw unemployment hover in the low single digits.
In particular, research has shown that the unemployment effects of increased unionization are predominantly felt by young and elderly workers. Therefore, the next time you hear that unions help make the labor market fairer, take that statement with a whole bag of salt.
Lastly, the human and interpersonal aspect of the argument against large union organizations cannot go ignored. Being someone who has never been part of a union myself, I asked my roommate, Ra Omar ’24, about his experience working as a Warehouse Associate at Windigo Logistics, where he was also a member of the Teamsters Local 455 union.
“Not only did I have to pay the union reoccurring fees, but the union ended up being the reason for the termination of my job,” Omar said. His job had been deemed redundant after the union pushed for substantial changes to the employment structure. Unfortunately, too many blue-collar workers across the country share Omar’s experiences with national unions.
Now, I am not at all arguing against the existence of all unions. I do believe that localized unions, especially in professions where workplace safety or financial security is a concern, should exist and legal guardrails must be in place to ensure corporations do not actively attempt to subdue the formation of such unions. But the existence and growth of behemoth national unions led by politically charged union bosses is detrimental to businesses, workers and, by extension, our entire economy.