Why unions are good for America

As the United Automobile Workers strike continues, we’re likely to hear grumbling about labor unions.

“They killed the auto industry once, and now they’re trying to do it again,” some will say. Or “They’re corrupt.” Or “They’re Luddites resisting modernization.”

Sure, there’s something to criticisms of unions. Yet the critiques miss a fundamental point: Labour unions are also a powerful force for equality, elevating underpaid workers who otherwise are often treated as doormats.

The central reality is that as unions declined over the past half-century, workers were stiffed. They were paid poorly, they lost health care and retirement benefits, and they lost control over their schedules. They were robbed of dignity and sometimes of wages as well. Deaths of despair from drugs, alcohol and suicide surged among blue-collar workers.

Anne Case and Angus Deaton, the Princeton University economists who pioneered the study of deaths of despair, said that one factor in the rise of such deaths has been the decline of unions and the related loss of good working-class jobs.

Like many educated professionals, I used to regard labor unions warily. They insisted on rigid work rules, impeded technological modernization, suffered corruption scandals (which have dogged the UAW) and sometimes engaged in racial and gender discrimination. They periodically manipulated overtime hours and leveraged the threat of disruption to rake in staggering sums.

In 2019, two Oakland, California, police officers “earned” more than $600,000 in pay and benefits, through absurd amounts of overtime; meanwhile, full-time dockworkers on the West Coast reportedly earn more, on average, than many lawyers or dentists in America, and dock foremen average more pay than physicians.

Yet executive pay seems even more scandalous, and I shed my disdain for unions as I reported on the crisis in America’s working class over the past 15 years. Having lost too many working-class friends to substance use and related pathologies and having witnessed the consequent crumbling of families and communities, I’ve come to believe that unions are good not only for individual workers but also for America itself.

Some of the UAW’s non-wage-related demands seem to me unrealistic, and the overall package might double labor costs for companies that already pay significantly more than their competitors; then again, it’s not obvious to me why the Big Three’s CEOs merit pay packages of more than $20 million each, while some of their autoworkers earn just $16 or $17 an hour, although in fairness, Ford says that, including benefits, the average compensation for union-represented workers is $112,000 a year.

(Anyone who thinks that executive pay is invariably calculated through an arm’s-length negotiation doesn’t understand board behaviour. As economist John Kenneth Galbraith observed, the paycheck “is frequently in the nature of a warm personal gesture by the individual to himself.”)

The golden age for unions in America was the period from 1945 to 1970, and there were indeed abuses and disruptive strikes then. But that was also a magical period in American economic history, in which the economic pie grew rapidly and was also divided more fairly. Shareholders benefited, but so did workers, including African Americans at the bottom of the economic ladder.

In 1970, unions still represented 29% of private-sector workers. Now they represent just 6%. Over the decades, blue-collar workers lost a path to the middle class, and pay gaps for Black men yawned as great as ever.

This article originally appeared in The New York Times.