Tyler Cowen: Democrats may not be organized, but they are unionized

The U.S. Capitol building is seen during the Congressional Remembrance Ceremony marking 20 years since 9/11 in Washington, D.C. on Monday September 13, 2021. (Yuri Gripas/Abaca Press/TNS)
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Tyler Cowen Bloomberg Opinion (TNS)

Last week’s vote by employees of the Democratic National Committee to join a union raises at least two questions. First: You mean they weren’t in one already? Second, and more seriously: Should left-leaning organizations encourage their employees to unionize?

DNC staff employees will now become part of SEIU Local 500, which already represents workers in Maryland and Washington. Meanwhile, many other Democratic-leaning fundraising and social media firms are also unionizing.

In one sense, this trend is unsurprising. The Democratic Party platform states: “Democrats will make it easier for workers, public and private, to exercise their right to organize and join unions.” The party, which relies on unions for a lot of financial support, is merely practicing what it preaches.

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One effect of social media is that they have made some kinds of hypocrisy harder to pull off. If the DNC and affiliated firms were to stay non-unionized, the tweets and Facebook posts reminding the world of that would never stop. What could they say in response? “Unions for thee but not for me” is not a message that will boost support and influence.

Liberal media outlets face similar issues. Vox Media unionized in 2019, in the face of pressure from their workers and readers. The National Labor Relations Board has criticized The New York Times for discouraging its employees from supporting a union covering some Times technology workers, although the paper disputes their account.

The dilemma is also present at universities, which especially at the top level tend to be left-leaning. There is a graduate student unionization struggle going on at Columbia University, and the likely result will be a 30% pay hike for graduate student teachers.

In economics, there are good rationalizations for the efficiency of (some) unions. When U.S. automakers had oligopoly power in the postwar environment, and had invested heavily in fixed assets such as factories, unions may have been an efficient way to force the companies to share some of their profits with workers. That said, those same unions later proved a liability when Japanese and other foreign competition emerged. Unions may also be an efficient means of bargaining over collective worker goods, such as greater perks in return for lesser pay.

But a lot of these business conditions don’t apply in current circumstances, so the union rationalizations don’t either. And there are cases in which unions are imposed on relatively thinly capitalized institutions. The new union for the Politics & Prose bookstore in Washington, D.C., for instance, probably doesn’t have a lot of excess profit it can capture. Sometimes a union can win a one-time pay increase but no permanent boost to longer-term compensation.

Columbia University, with its sizable endowment, is a relatively well-capitalized entity. Still, it’s appropriate to ask what problem is solved by a graduate student union. The main difficulty for these students seems to be a lack of jobs when they graduate, and a pay hike might crowd the field further, with unwelcome consequences for the job market. And in the long run, the university could simply cut back on its initial financial aid offerings. The point is, it is hard for graduate student unions to bargain effectively across many of the most relevant dimensions of their student and work experience.

In the meantime, all of these unions are introducing additional veto points into the workplace, sometimes slowing response times. If you run the business and plan to make a big change in how it operates, you might feel — either contractually or tactically — that you need to check with the union first. And if you are a Democrat and a pragmatist, you might prefer a more effective but less unionized DNC, which after all is a major promoter of unionization for the U.S. economy as a whole.

What would a less hypocritical version of a Republican organization look like? Should everyone be given equity shares, or should there be bonuses for star performers? Whatever the answer may be, it probably won’t be debated much in public, as Republicans tend to be more circumspect about such matters. That’s a danger for Republicans, who may find it harder to live up to their principles if no one is calling them to account.

The Democrats, in contrast, tend to stage noisy debates — most of which, sooner or later, seem to settle in the same direction. That’s not a healthy norm of discourse, either.

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ABOUT THE WRITER

Tyler Cowen is a Bloomberg Opinion columnist. He is a professor of economics at George Mason University and writes for the blog Marginal Revolution. His books include “Big Business: A Love Letter to an American Anti-Hero.”

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

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