Chicago Columnist Illinois Review · Political Strategist Analyst · Expert Advisor Institute for Truth in Accounting

SEIFFE:  The Price For A Bail Out

Tuesday, November 18, 2008 

By Ralf Seiffe

One of the new administration’s stated objectives is to pass the so-called “Employee Free Choice Act” a piece of legislative jetsam that would end employees’ right to a secret ballot in union elections. The bill, which has received a majority in both Houses of Congress, would permit a union to bypass an actual election when it secured the signature of more than half the workers on an organizing petition. At the same time, the car companies are in Washington seeking a second installment of a bail-out. This coincidence presents an opportunity for the Republican “loyal opposition” to connect union reform with the bail-out and thereby increase real liberty.

The “Employee Free Choice Act” is as misnamed as it can be because it allows organizers to appear at one’s workplace, favorite saloon or even at one’s home to extort a signature.  It’s hard to imagine how a young, single mother or an entry level worker’s freedoms are improved when a large, intimidating organizer appears out of context, at one’s residence, after dark.  In some states, such activity would be considered home invasion because it’s economically motivated and involves the perception of force.
In fact, this law will move organizing from the workplace where it’s more or less transparent into the shadows where it will have all the hallmarks of a mob hit.

While the bill’s signature provisions have been well-reported, another of the bill’s features has not been widely discussed.  This provision might be thought of as the “union protection ratchet” because the bill permits organizers to use this sub rosa process to organize but workers are prohibited from using the same process to decertify or replace an incumbent union.  The proposed law specifically outlaws this signature-only provision if an individual or a labor organization already represents workers.

This relates to the automotive bail-out because automotive is one of the most unionized businesses in existence.  The management and the union have bargained for years to the point where an hour of labor costs GM $72 compared to $45 at an American assembly plant operated by Toyota.  It’s important to remember that this unsustainable trend of employee benefits were convenient for both management and the union when the car companies had an 85% market share but now, with only half, they can no longer dictate car prices or quality.

The domestic manufacturers will not survive their current costs so something must change regardless of whether a bail-out occurs.  One would think that rational workers would look at their options and, as attractive as $72 per hour looks, prefer $45 per hour to unemployment.  Yet, the leaders of the United Autoworkers Union say they will not consider any concessions. This intransigence will lead to a great schism in the work force as hard-headed union men clash with others who want the industry to survive, even if they make somewhat less money.  Having had some experience with the Autoworkers in a summer job, this schism will make the Civil War look, well, civil.
 
There is no reason to provide bail-out money to the domestic car companies without significant changes in their business model.  This includes changes to management, long-suffering suppliers, dealers, government regulators and labor costs.  The best answer is probably bankruptcy because such changes could be imposed but management tells us that is “not an option”.   If so, there will have to be a consensual solution.

So, Republican senators and Democrats who represent states which would like to attract new automotive factories, here’s a chance to relieve the pressure that will certainly develop as labor concessions are debated.  As the situation plays out, management won’t be (and shouldn’t be) protected but neither should entrenched, co-conspiring union managers. 

The companies’ boards of directors will fire their managers when they begin to understand there are more shareholders selling than buying.  There is no equivalent for rank-and-file workers—they can’t sell out, like shareholders.  Their future is much more controlled by their union representatives who may be older, or see things differently or believe that the company is really the enemy.  These union leaders have often protected themselves from any real oversight just like managers pack their boards. So, assuming the Employee Fair Choice Act will be passed by the new Congress, here’s a chance to level the playing field.

The Republicans and one or two allies from across the aisle should filibuster until the bill is modified to actually increase the average workers’ freedom of choice.  One way to accomplish this would be to equalize the workers’ right to de-certify or to replace a union without an election by collecting the same number of employee signatures that the proposed bill requires to certify a union. 

Ralf Seiffe advises business start-ups and product launches from Chicago, Illinois and is a political analyst and columnist for the Illinois Leader and Illinois Review.

Webmaster Contact:  Alynn Patzer alynn11111@aol.com