Look out for the union label

in the new issue of the Claremont Review of Books (subscribe here), William Voegeli addresses the liberal support for labor unions in the age of Obama. Expressing the old-fashioned view that labor unions operate as “cartels” redistributing wealth from companies’ owners and customers to union members and officers, Voegeli covers a lot of ground in “Look out for the union label.” The unions’ operation as cartels gives rise to the kind of behavior we’ve recently observed from the friends of Barack Obama at a few townhalls this month:

Employee cartels will fold up if employers can obtain the services they sell on more favorable terms outside the cartel. The leverage unions use to redistribute wealth is based on their ability to make this more trouble than it’s worth. Thus, unions derive their power from making life unpleasant, and sometimes dangerous, for “scabs” who cross picket lines, and firms that hire from outside the cartel or balk at its terms.

The reemergence of union power in the age of Obama is, as the Communists used to say, no accident. Liberalism is back where it started in the age of Roosevelt, Voegeli writes: “Among the ways in which the Obama Administration is not letting the economic crisis go to waste is by making clear that liberalism is rushing back to the pre-Reagan era, when sensible thoughts such as [Washington Monthly editor Charles] Peters’s were banished from acceptable discourse. 2009 is 1933 all over again, when the creation of wealth was morally repugnant and, somehow, economically irrelevant, while the governmentally sanctioned reallocation of wealth from the less to the more deserving was the necessary and sufficient condition for social justice.” Voegeli discerns a back to the future element to recent events in the auto industry:

Walter Reuther was acting as a good unionist and a good New Dealer in 1946 when he led a UAW strike against General Motors over his demand for a 30% wage increase coupled with a freeze in the retail price of all G.M. cars. Barack Obama is doing the same today, when he uses taxpayer funds to buy the Chrysler corporation for his supporters in the autoworkers’ union, then publicly berates the “small group of speculators” who had the temerity to complicate his plan “by refusing to sacrifice like everyone else.” That is, they wouldn’t drop their demand for the return of an inconveniently large fraction of the money they had lent the company.

Voegeli poses the question whether, in their exhilaration at being free at last to ignore markets and their defenders, Obama liberals will forget the excesses caused by the hostility to markets, excesses that brought conservatives to power. The union movement had a long run from the adoption of the Wagner Act during the Roosevelt administration to the moment when Ronald Reagan decided to resist the illegal PATCO union strike in the first year of his administration. One can only hope that the forces of reason will set in earlier this time around as union power reasserts itself in the Obama administration.

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