OpenMarket: Labor and Employment

Chairman John Ring delivered the latest salvo in response to the manufactured “scandal” at the National Labor Relations Board (NLRB). Democrats, with help from the NLRB inspector general, have improperly accused members of the board of bogus conflicts of interest that have impeded the policymaking ability of the agency. These attacks are political, and have no factual basis.

On September 30th, Eugene Scalia was sworn in as the 28th Secretary of Labor. Last week, the Senate confirmed Scalia on a 53-44 vote. With about 15 months left in President Trump’s term, here are few actions the Labor Department can take to increase union financial transparency, cut down on federal construction costs, and study the impact of wage and hour laws.

Congress nearly increased the federal minimum wage from $7.25 to $15 per hour this year. Though the Raise the Wage Act is unlikely to pass the Senate, 29 states and numerous local governments have passed their own increases. Moreover, the next session of Congress will almost certainly reintroduce the bill. This issue will be alive for a long time to come. Though some workers would benefit from a higher minimum wage, this would only be at other workers’ expense. As I argue in a new paper, minimum wages have tradeoffs.

Late Tuesday evening, the California legislature passed controversial legislation that would codify a state Supreme Court decision, which adopted a flawed test that effectively prohibits companies from doing business with independent contractors and restricts individuals’ ability to earn a living as an independent contractor.

By deferring compensation, in the form of pensions, and pushing those costs well into the future, politicians can gain favor with government employee unions, which are major political players and donors, while passing on the pain of paying for said compensation on to their successors.

Today, the Competitive Enterprise Institute (CEI) released a report that analyzes the Protecting the Right to Organize (PRO) Act of 2019 (H.R. 2474), which the House of Representatives is expected to vote on in September. The bill overhauls labor relations law and tilts the playing field in favor of unions without regard to the negative consequences on workers, employers, and the economy.

Democrats in Congress introduced the Protecting the Right to Organize (PRO) Act with the state goal of strengthening union power and increasing union membership, which is near all-time lows. But to produce such a result, the rights of workers during union organizing campaigns are curtailed.

One of the most well-known and enduring lessons of public choice economics is the dynamic of concentrated benefits and diffuse costs. Well-organized groups have both the incentive and ability to lobby government for benefits for themselves, paid for by taxpayers at large, who lack organization and whose individual payouts toward said benefits aren’t large enough to prompt them to expend much effort opposing this arrangement.

Earlier this year, the Federal Bureau of Investigation served indictments to several high level United Auto Workers (UAW) officials, some of who have already pleaded guilty or were convicted, for pilfering millions of dollars that were earmarked to train union members.

It is a banner day for employee choice. For the first time, airline and railroad workers have a direct path to remove an unwanted union.