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The United Auto Workers have gone on strike: https://www.reuters.com/business/autos-transportation/us-auto-union-strike-three-detroit-three-factories-2023-09-15/
What happens if Ford and GM simply say: "okay, you're fired"? This seems to have quite a few benefits, mostly that they can get rid of union workers and remove the threat of another strike.
I'll admit that unions sortof confuse me. I didn't grow up around them and have always wondered the mechanism by which everybody gets to quit their job but then demand extra money to come back. Are the people running factory machines inside of Ford and GM (or starbucks, or a hollywood writers room) really that highly skilled?
It should be noted that Tesla is not unionized, and will not be a part of this strike. Do you guys think there is a chance that the government tries to force Tesla to stop making cars during the strike to make things more fair?
I'll be honest about my feelings towards unions: I don't get it at all, and I think I'm missing something. I do think that workers should have an adversarial relationship with their employer, but it seems to me like unions have all but destroyed the american auto industry. I think you'd be insane to not just fire anybody who joins a union on the spot. I don't get how places can "vote to unionize". Why does the employer not simply fire the people doing the organizing? Sure you can all vote to make a starbucks union, but...I just won't hire anybody in your union.
The best argument I've heard in favor of unions is that the equivalent bargaining power of "a company" isn't "an employee" it's "all the employees".
Suppose we remove the distinction of capital versus labor, and suppose that we have two groups of people with disproportionate level of bottleneck in a production process. That is, if we have X people from the first group, and Y people from the second group, then the level of production is something like
f(X,Y) = A sqrt(X)P(Y)
where A is some constant, and P is 0 if Y is 0 and 1 if Y >= 1
That is, you only need one Y (the employer), but can have as many X as you want, but the more X you have in the same job the more diminishing returns you get. For each production process people can gather together and organize and form mutually consensual agreements to find some equilibrium level of X that makes this efficient. BUT, Y has disproportionate bargaining power here. If any individual X threatens to quit, their quitting drops the profits of the process by some small amount. But less than their average. The other X essentially pick up the slack, and the production keeps on going. But X is now unemployed and has 0 income, which is catastrophically awful and wasteful, as all of their potential labor is essentially being wasted unused. X quitting hurts themselves more than it hurts Y. But if Y threatens to quit then everything stops and everyone is at 0, so it's a credible threat.
But if all of the X form a union and threaten to quit/strike together, then again production stops entirely, just as if Y threatened to quit. So now they have equal bargaining power.
I'm pretty sure whoever I read this sort of argument from explained it way better than I just did, but I don't remember who or where (it might have been on the motte, so if whoever it was recognizes this argument as their own and can find the post, feel free to repost it and claim credit).
Lots I disagree with here. The correct way to analyze employee vs. employer negotiating power is by considering all potential employees and all potential employers, e.g. the free market as a whole. If there are 1000 people who could be widget workers, then the single employed widget worker obviously doesn't have nearly as much bargaining power as their employer. On the flip side, if there are 1000 widget factories and only 1 qualified worker, that worker obviously has much more bargaining power than any of their employers do.
Whoops. I skimmed grandparent comment and sort of of vaguely inferred it was making a good argument similar to one I've read in the past, but you (meriadoc) are right and it's just wrong.
A liquid, free market that has a thousand sellers of same good and a septillion buyers will still be a very efficient market (assuming the thousand sellers are legally prevented from coordinating with whatever singularity tech allows a septillion entities to communicate in the first place). Any buyer who's being stiffed can just switch to another of the 100k sellers.
So in an idealized economic labor market with 1000 big employers and a hundred million employees, the employer still doesn't have much bargaining power, because the employee's alternative to not working still isn't 'not being employed', it's getting a job at another employer - their BATNA is just a slightly lower wage than their current one.
What GP was probably vaguely reaching at is all of the non-basic-econ-model reasons that employers have market power over workers - real world issues like specialization in certain jobs, the reduction in income caused by the gap in labor where you apply for a new job, risk in unknown gap spent not working and income of the future job, the fact that companies appoint (relatively) specialized and (relatively) high IQ people to create a system for negotiating with workers while workers are lower IQ and less sophisticated in negotiation, your commute restricting you to workplaces in your geographic area, the sheer convenience and habit of your current workplace, the gap in income interrupting spending you had planned because you made the mistake of not saving money (whether the spending is discretionary, which people still care a lot about, or mandatory spending on necessities for you or a family you need to support), cutting off benefits like health insurance tied to your workplace... All of these create situations where (in the current set of social circumstances) negotiations between employers and workers look and feel like ones where the employee's BATNA is 'no income for a few months and begging for rent money'.
Also, the difference in pay between modern non-union and modern union jobs, for any specific occupation, is much lower than you'd expect from either OP or the (more accurate claims in the) non-libertarian FAQ.
Yes, exactly, you put it better than I could.
Yours didn't have 200 word, paragraph-long run on sentences, though, I should probably put more effort into composition...
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But the second situation is not even possible, you cannot have a factory without any workers...
Robots make it more and more possible every day.
Then there will be no need of a skilled worker...
You seem to think that's an issue. Pray tell, if workers accomplish nothing of value, why should they have any bargaining power at all? At that point better to go with UBI or something than support unions.
I agree, it would not be an economical problem. However it seems to me it is a problem with your argument: the negociating power of the workers has not increased because there is no need for them.
I was talking about what negotiating power actually is, not what it should be. Generally (with plenty of exceptions, such as monopolies) I think we should leave negotiating power as it is, though, and regulate around it.
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Right... but which of those is closer to reality, though?
In reality there are about as many jobs as workers, considering the entire market together, though the quality of each varies.
In reality I'd say high-quality jobs and high-quality employees have a big edge, with the latter slightly winning out overall. In other words there are far more potential jobs for skilled applicants than there are highly skilled applicants.
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