It's not often that a union election makes front-page news. But last week's stunning loss by the United Auto Workers at a Volkswagen plant in Chattanooga, Tenn., is a seminal event in the history of the labor movement. Union membership has fallen consistently over the past 60 years, and the UAW loss suggests there's no way for labor to reverse the trend -- at least not in the private sector. But why?
The UAW blames Republican politicians and conservative groups --outside agitators, if you will. Sen. Bob Corker, a former Chattanooga mayor, weighed in on opposing unionization at the plant during the voting, claiming a vote against the union would enhance the chances that VW would give the plant the right to build SUVs, adding hundreds of jobs. But the bigger problem was that the union had little to offer prospective members. Workers get little in return for paying dues that equal two hours' pay monthly.
There was a time when the difference between a union job and a nonunion job paid off. Unions offered job protection, steady wage increases and, most importantly, generous benefits, including first-rate health insurance. Indeed, the reason most employees receive health insurance through their employers is that unions demanded the benefit in their collective bargaining agreements during World War II when the National War Labor Board imposed a freeze on wages. The new benefit -- which was tax-free -- was so popular with workers that even nonunion employers adopted it in order to attract employees.
But with the advent of Obamacare, even that union advantage has disappeared. Not only is health insurance now available to everyone (though not everyone wants to pay for it), but unions can't bargain for the kind of Cadillac policies they once could. Even with union carve-outs granted by the administration, most employers will balk at gold-plated policies when forced to pay Obamacare's 40-percent excise tax and can do so with impunity as long as the plans they offer meet the Obamacare minimum requirements.
Wage differences between union and nonunion jobs are significant in some industries, but they often come with a price. Markets determine wages, no matter how hard unions and governments try to interfere.
Linda Chavez is chairman of the Center for Equal Opportunity and author of Betrayal: How Union Bosses Shake Down Their Members and Corrupt American Politics .
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