The United States recently observed Labor Day, a national holiday that is meant to celebrate the contributions that workers have made to promote our nation's prosperity. While Labor Day is intended to pay honor to all workers, labor unions appear to view the holiday as their very own, as though it were Labor Union Day, using it to help propagate the notion that, if it were not for labor unions, workers would be toiling six days a week from dawn to dusk for low wages and no benefits, under the exploitative supervision of greedy capitalists. Labor unions would have us believe that they are the champions of the working man, "the little guy," who is too weak to be able to bargain with the owners and management of big corporations by himself. But is that romantic view of labor unions riding to the rescue of the working stiff truly a reflection of reality? How do labor unions actually play their role in our economy? What is the true nature and character of a labor union?
What We Know About Unions
According to Webster's Collegiate Dictionary, a labor union is "an organization of workers formed for the purpose of advancing its members' interests in respect to wages, benefits, and working conditions." In order to succeed in holding such an organization together over the long term, a labor union has to be able to deliver on the claim that it can and will obtain a better deal for its members than they would receive acting on their own in a free and open market. The only means of accomplishing that is by controlling the supply of labor available to an employer, which the labor union does by preventing workers who are not members of the labor union from gaining access to the employer. When there is a contractual agreement between a labor union and an employer, it is essentially a compact whereby the employer agrees to enforce the provisions of the contract, which almost invariably includes the requirement that the employer will only hire members of that labor union.
When we observe the phenomenon of labor unionism as described in the foregoing paragraph, we can see what labor unions are really all about. Labor unions are not organized against employers at all; they are organized against all of the workers who are outside of the union! To prove that to yourself, and to show that the conventional wisdom about labor unions being for the little guy is an utter myth, you need only ask yourself a very simple question: When was the last time you saw a labor union trying to organize the unemployed? (To what end would the unemployed be organized? Obviously, to try to get the jobs of those who are already employed, which is exactly what labor unions want to prevent!) In fact, employers and labor unions, far from being adversaries, actually become partners, working together to shut out from employment those workers who are not members of the labor union.
We know that a labor union is an organization of workers, but what kind of organization is a labor union? Is it a fraternity? Is it a business? Is it a charity? In any case, there is a crucial distinction between labor unions and all other private organizations: Labor unions are allowed to use coercion in their attempts to achieve their goals, thanks to various pieces of legislation that have been enacted into law by the federal government, and to the federal bureaucrats and judges who have administered and interpreted those laws over the ensuing years. For example, no other form of private organization is allowed to compel people to become members and force them to pay dues simply to get or keep a job, but labor unions are able to do precisely that and set up so-called "union shops." For all practical purposes, labor unions are entitled to function as something akin to extortion rackets, all the while operating under government protection.
The argument for a union shop is that all employees will receive higher …