One thing to add to today’s editorial on the National Labor Relations Board, which is looking to change union-election rules to tilt the game even further in favor of Big Labor. There are two main ways to harm enterprise through regulation. One is to have bad, onerous regulations. The other is to have regulations that are always changing. In the case of the contemplated NLRB action, we’ll get both.
Private-sector labor unions are withering on the vine and have been for some time. But it is no coincidence that many of the industries that are most vulnerable to them — large, investment-intensive, capital-intensive businesses involved in industrial and manufacturing work — are the very ones whose domestic decline has us bemoaning the dearth of factory jobs that once were a bulwark of middle-class life. Unions certainly are not the only reason for the decline in U.S. manufacturing employment, but they are not an insignificant one, either. If you are an entrepreneur thinking about starting a large industrial enterprise, or an incumbent firm thinking about building a new factory or launching a new line of production, you want to know that your tax and regulatory environment is livable — and that it is not going to change at the whim of one or two or three people in Washington, D.C. The NLRB has five seats (and four members serving; there’s a vacancy at the moment). The fact that such a tiny group of unaccountable political appointees can just wake up one fine morning, have some Pop-Tarts, and then decide to rewrite the nation’s union-election rules is terrifying. Such changes ought to require an act of Congress.
My own preference would be to dissolve the NLRB, repeal the Wagner Act and the Railways Labor Act, and stop forcing businesses to accept contracts that they do not wish to accept. (In what other field of life is a contract considered valid if one side does not wish to be a party to it?) Our labor “relations” are an exercise in extortion, and they probably cost American workers more in the form of forgone opportunities and lost investment than they win for them. The problem is that the fruits of that extortion are highly concentrated: among government workers and the 7 percent or so of private-sector workers in unions. Repealing the Wagner Act sounds radical, and it would not be easy, but it would be a very good thing for the country.
(Speaking of stable rules, I feel the same way about taxes. Here’s a thought experiment: Setting aside budget-balancing questions and related matters, which would you rather have: a 10 percent overall reduction in federal taxes, or an ironclad guarantee that federal tax rates and rules would remain unchanged for the next 50 years? I think there’s a pretty good case to be made for either.)