Roosevelt Institute | Cornell University

Wisconsin Labor War 2.0

By Jackson WeberPublished March 14, 2015

null
As Wisconsin Governor Scott Walker's presidential prospects blossom, the ability of unions to operate in Wisconsin shrivels once again. Right to Work laws have been popping up across the nation in Republican held states and Wisconsin is the GOP's next target. Walker's continued crusade against organized labor may make him the darling of the right, but that status may come at a significant cost to the well being of his constituents.
With the 2016 Presidential election beginning to loom on the horizon, Wisconsin Governor Scott Walker continues to emerge as a Republican contender. In just over four years in office, Walker has fought hard for his political future. Despite winning only two general elections with a recall election in between, the Governor's presidential ambitions were sensed all along. What really boosted Walker's Presidential prospects was his time in the national spotlight as he attempted, and succeeded, in eliminating the collective bargaining rights of public sector unions in Wisconsin. This divisive action drove hundreds of thousands of Wisconsinites to venture to the capital in protest, while simultaneously elevating Governor Walker's status on the right (Davey).

            Now, Walker and the Republican held state legislatures are preparing to further their stance against organized labor with the upcoming passage of Right to Work (RTW) legislation. Although Walker originally stated that the push for RTW laws supported by the state legislature were a "distraction" to his other state policy pursuits, he appears unlikely to veto any anti-union legislation ("Scott…"). Wisconsin's RTW law would be modeled after Michigan's, which has already stood in the courts, and would make it illegal for unions to require that everyone who benefits by a collectively bargained contract pay union dues. Some unions are very involved politically and members may object to those activities. Left out of that argument however is the fact that union members can currently stipulate that their dues only go towards negotiating costs and not political activity (Lafer).

The incredibly well crafted rhetoric from supporters of RTW has unsurprisingly implanted these laws into the public psyche as freedom issues. There are, however, many other organizations that require members to contribute financial to reap the benefits. Economist Gordon Lafer made that point impeccably clear when he described other instances of organizations collecting dues: If lawyers want to practice they must pay dues to the bar association, homeowners associations collect dues from residents wishing to live in the housing community, chambers of commerce charge dues for members to derive their benefits, but none of these policies are being politically charged as freedom issues (Lafer). Right to Work laws, in reality, legalize the right to freeload off of unions (Bernstein).

If successfully passed, Wisconsin would become the 25th state to institute RTW laws. Despite claims that RTW laws have definite positive economic effects, primary reducing unemployment, on states that have implemented them, a variety of variables impact the health of state economies and it is difficult decipher the true impact (Laffer). Any research must attempt to control for factors uninfluenced by passage of a RTW law, a tough process to perfect. For example, supporters would be quick to point to North Dakota, a Right to Work state, which in 2014 had the lowest unemployment rate of any state ("Unemployment…"). Yet in the same year, Mississippi, another Right to Work state, had the highest unemployment of any state ("Unemployment…"). It appears that Right to Work does not have as a significant impact on unemployment and job creation in comparison to other influential factors.

Although it is challenging to measure and monitor Right to Work's impact on jobs numbers, the effects on wages of union members and non-union members and the strength of the middle class are clear. As a result of the direct impact of unions and their members, it is natural to expect that union wages and benefits would decrease with RTW laws. The detrimental effect on non-union member wages may come as a surprise though. Research by Elise Gould and Heidi Shierholz concludes that average annual wages in RTW states are $1,500 lower per worker in non-RTW states (Gould). Punishing non-union workers is clearly not the intent of the law, but it is an undesirable byproduct. Employee sponsored pension plans also had significant value declines in RTW states. In addition, middle class economic politics and wage stagnation are currently important public policy issues and will continue to gain in importance as the 2016 elections approach. The common point is that although the economy seems to be recovering, that improvement has not trickled down throughout society (Hersh). Middle class income shares in Right to Work states have shriveled as union membership has simultaneously declined substantially. This change in income share is also affected by outsourcing of historically union jobs overseas, but RTW does not help this cause, as it is a sunk cost. As middle class income shares decline, the benefits of economic growth are increasingly concentrated in the hands of the capital class. Workers financial benefits remain stagnant.

Unions and their power exist to protect laborers while also more equitably dispersing economic gains down the supply chain. If unions lose strength and cannot bargain, the power of management will grow unchecked. The government will be the only entity protecting workers in any capacity. Let laborers protect themselves and work for their own rights. It is essential that the benefits of economic growth touch all members involved in that growth.


Image Source: http://www.maciverinstitute.com/2015/01/wisconsin-is-ready-for-right-to-work/