Monday, July 11, 2005

Ancillary benefits of unionization

Nathan Newman writes at TPMCafe:
While Wal-Mart is often considered the embodiment of the global race to the bottom in work conditions, its big box competitor, Costco, competes with average wages of $16 per hour and the company foots 92% of employee's health insurance costs.

This is not an accident but the result of union effots.

But here's the interesting fact. Only 18% of Costco's workforce is unionized, but as this Labor Research Association article details, this has a ripple effect throughout the company. If the company didn't extend similar benefits to the non-union Costco employees, the whole company would be unionized rapidly.

And in a similar way, while only 10% of the private workforce is unionized in the United States, this has profound effects in keeping wages higher for most non-union workers as well.
Read the rest, of course.

It's important to remember that the process Newman describes explains why socialism never really took of in the US. On some level, one can model socialist government as a gigantic union, a super-AFL-CIO in which every citizen is a union member. By giving every citizen a part in the collective bargaining, everyone gets the benefits.

The Socialist Party was a pretty big player in early 20th century America, getting mayors, state legislators and even some congresscritters elected. But it never gained power because the capitalist parties were prepared to offer enough benefits to workers and protections to unions that the public never developed a sense that they all wanted to be in unions.

The benefits of union pressure ensured that even non-union workers were satisfied, and the system was able to proceed as normal with only slight modifications.

The challenge today is how to ensure that the same process can operate around the world.