By Diana Furchtgott-Roth
This piece originally appeared at Real Clear Politics, 3-12-09. Diana Furchtgott-Roth is a senior fellow at the Manhattan Institute.
Stock markets are near their lowest levels in years, the federal budget deficit has shot to an all-time high, consumer confidence is at a record low, the unemployment rate has been rising and hit 8.1% in February, and over four million jobs have disappeared in the past year. Yet on March 10 congressional Democrats introduced in the House and Senate the misnamed Employee Free Choice Act.
Contrary to its name, the bill's main thrust is not to widen employees' choices, but to narrow them. It eliminates the secret ballot for union elections. Under the law now, if a sufficient number of workers petition the National Labor Relations Board to join a union, the Board conducts an election--by secret ballot--to see if a majority wants a unionized shop.
The Employee Free Choice Act would allow workplaces to be unionized without secret ballots. If a majority of the employees sign a card that says an employee wants to join a union, a process known as "card check," the workplace can be unionized. This process strips workers of the protection of a secret ballot and exposes them to coercion by union organizers and leaders.
With card check, workers can check in but they can't check out. For workers to leave the union, a secret ballot would still be required. This is the height of hypocrisy--that the so-called benefits of "employee free choice" only apply to join a union but not to leave it.
Equally harmful is the bill's little-publicized mandatory arbitration provision, which short-circuits collective bargaining. If the union and the employer fail to reach an agreement on pay and benefits after 90 days of talks, the bill would require them to submit to binding arbitration, with a mandated contract that would hold for the next two years.
That requirement would be unprecedented in American labor law. It would revoke the basic principle of free collective bargaining--that employers and unions may disagree unless they voluntarily accept arbitration.
The union-sponsored bill is intended to help unions reverse a long-term decline in membership. It would harm the economy by increasing unemployment, potentially making the economies of Texas and Oklahoma look more like those of Ohio and Michigan. And, despite his talk of fiscal responsibility, President Obama has promised to sign the bill if it reaches his desk.
Chairman George Miller of the House Education and Labor Committee offered this defense of the bill: "If we want a fair and sustainable recovery from this economic crisis, we must give workers the ability to stand up for themselves and once again share in the prosperity they help to create."
The problem is that the Employee Free Choice Act, if passed, would do just the opposite. It would slow economic recovery by increasing unionization, artificially raising wages, and therefore raising unemployment. It would turn states with below-average unemployment rates, primarily in the South, into states with high unemployment rates.
What Mr. Miller is asking for American workers is less than what he once sought for Mexican workers. In a letter dated August 29, 2001, coauthored with 15 other congressmen, Mr. Miller wrote to the arbitration council in Puebla, Mexico, "We feel that the secret ballot is absolutely necessary to ensure that workers are not intimidated into voting for a union they might not otherwise choose."
Why would Mr. Miller strip American workers of that protection? With union membership declining and now at a weak 7.6% of private sector workers, building up dues-paying membership is the unions' paramount goal, despite the harm it would do to the economy.
In the 2008 election cycle, unions gave millions to Democratic candidates for Congress. Now they want to collect on their investment.
But the deep slump in the economy has eroded support for the Employee Free Choice Act among members of Congress. The bill will pass the House, even though its number of cosponsors has slipped from 230 to 223.
The Senate, however, is a different story. Whereas the bill had 46 cosponsors in the Senate in 2007, it now has 40. If the bill does pass, President Obama has said that he will sign it.
Organized labor made repeal of the secret-ballot requirement a high priority because the intrinsic rationale for unions has been weakening.
Fewer workers see the need to belong to unions because basic health and safety conditions have become standard. Many unions price their workers out of jobs, sending jobs overseas or to more efficient nonunion firms, while taking dues from members to spend on political campaigns and high salaries for union officials. Workers can see that unionized domestic auto companies, notably GM and Chrysler, are in worse shape than foreign companies with nonunion American plants, such as Toyota, Nissan, and Honda.
Nonunion firms have more flexibility to adapt to changing conditions than do unionized firms. States with laws protecting workers from being compelled to join unions saw increases in nonfarm employment of 47% over the past 20 years, double the 21% increase in states with no such worker protection.
With jobs at risk now and personal assets shrinking, people are scared. To enact a bill that is likely to make economic conditions worse would be both foolish and irresponsible.