Factual rebuttal to the effort by Mitch Daniels to destroy private sector unions in Indiana:
As a report by the Higgins Labor Studies Program pointed out, trying to attract businesses to a state based on low wages is the “low road” to economic development. It is a “trickle-down” approach that leads to a “race to the bottom.” It undermines living standards for most workers and, in a globalized environment, is unlikely to lead to a long-lasting increase in economic growth.
Most people would agree that lowering wages and benefits for Indiana workers is not the best way to promote economic development in Indiana. RTW advocates seem to recognize this and go to great lengths to deny that RTW laws lower wages and benefits. In a section in its report titled, “Testimony Supporting RTW,” the committee states that “RTW states have … higher wages when adjusted for cost of living … than non-RTW states.”
The truth of the matter is that RTW laws do lower wages and benefits — for all workers in RTW states. In a recent thoroughly documented and well-researched study (which, by the way, adjusts for the cost of living), economists Elise Gould and Heidi Shierholz demonstrate that workers in RTW states make $1,500 less in wages annually compared to workers in non-RTW states.
In its section on testimony supporting RTW, the committee repeats, without comment, the following statement: “Unions argue that they are forced to bargain for all employees, not only for union members, but there is nothing in law that forces them to do that.”
This statement, however, represents a misunderstanding of the relevant legal principles under the National Labor Relations Act. Section 9(a) of the NLRA provides that any unions selected or designated for purposes of collective bargaining “shall be the exclusive representatives of all the employees in such unit. ..” (emphasis added). Moreover, the U.S. Supreme Court has held that a union owes a duty of fair representation to all employees in the bargaining unit (union members and non-members alike), and it is because of that duty that the court has sanctioned the imposition of fees “to the extent necessary to ensure that those who enjoy union-negotiated benefits contribute to their cost.” In addition, if a union has not been designated as the exclusive representative of all employees in the bargaining unit, then the employer is under no statutory obligation to collectively bargain with the union.
It might also be useful to point out another misleading statement about unions in the committee report. Its first “finding of fact” states the following: “Based on the principles of freedom of speech and association, individuals should be able to choose whether or not to associate with unions.” There is no requirement under current labor law for any worker to join a union. The “fair share” clauses that RTW laws would ban do not require workers to become members of a union; they only require workers who benefit from the results of a collective bargaining agreement to contribute to the costs of negotiating and administering that agreement. The Supreme Court established this principle in NLRB v. General Motors Corp., and further defined it in Communications Workers of America v. Beck.
Mitch Daniels was and is the regional leader of the effort to lower wages and quality of life for working people that is now being conducted in Ohio and Wisconsin. He was first. Daniels put all of these policies and practices in, beginning way back in 2005, when he ended public sector unions by executive order. Daniels got the whole conservative-libertarian race to the bottom wish list, virtually unopposed, until now, when he’s finally, finally meeting resistance.
And what’s the result for ordinary people in Indiana? What’s the result after they made concession after concession on worker rights and sold or privatized state assets and public services? How’d that go for them?
This is the Indiana unemployment rate: 9.0
This is Ohio: 9.0
This is Wisconsin: 7.7
Ohio and Wisconsin don’t have to travel far to see what race to the bottom gets them. They can simply hop on the privatized toll road and visit Indiana. Nothing. They’ll get nothing. They can meet the demands of the politicians and pundits who serve “job creators” and when they take those hits the same people will simply tell them they haven’t given enough yet and be right back for more.
This is the report on how RTW reduces wages across the board cited in the editorial.