The Right Opinion

The Right-to-Work Dilemma

By Charles Krauthammer · Dec. 14, 2012

WASHINGTON – For all the fury and fistfights outside the Lansing Capitol, what happened in Michigan this week was a simple accommodation to reality. The most famously unionized state, birthplace of the United Auto Workers, royalty of the American working class, became right-to-work.

It's shocking, except that it was inevitable. Indiana went that way earlier this year. The entire Rust Belt will eventually follow because the heyday of the sovereign private-sector union is gone. Globalization has made splendid isolation impossible.

The nostalgics look back to the immediate postwar years when the UAW was all-powerful, the auto companies were highly profitable and the world was flooded with American cars. In that Golden Age, the UAW won wages, benefits and protections that were the envy of the world.

Today's angry protesters demand a return to that norm. Except that it was not a norm but a historical anomaly. America, alone among the great industrial powers, emerged unscathed from World War II. Japan was a cinder, Germany rubble, and the allies – beginning with Britain and France – an exhausted shell of their former imperial selves.

For a generation, America had the run of the world. Then the others recovered. Soon global competition – from Volkswagen to Samsung – began to overtake American industry that was saddled with protected, inflated, relatively uncompetitive wages, benefits and work rules.

There's a reason Detroit went bankrupt while the southern auto transplants did not. This is not to exonerate incompetent overpaid management that contributed to the fall. But clearly the wage, benefit and work-rule gap between the unionized North and the right-to-work South was a major factor.

President Obama railed against the Michigan legislation, calling right-to-work “giving you the right to work for less money.” Well, there is a principle at stake here: A free country should allow its workers to choose whether or not to join a union. Moreover, it is more than slightly ironic that Democrats, the fiercely pro-choice party, reserve free choice for aborting a fetus, while denying it for such matters as choosing your child's school or joining a union.

Principle and hypocrisy aside, however, the president's statement has some validity. Let's be honest: Right-to-work laws do weaken unions. And de-unionization can lead to lower wages.

But there is another factor at play: having a job in the first place. In right-to-work states, the average wage is about 10 percent lower. But in right-to-work states, unemployment also is about 10 percent lower.

Higher wages or lower unemployment? It is a wrenching choice. Although, you would think that liberals would be more inclined to spread the wealth – i.e., the jobs – around, preferring somewhat lower pay in order to leave fewer fellow workers mired in unemployment.

Think of the moral calculus. Lower wages cause an incremental decline in one's well-being. No doubt. But for the unemployed, the decline is categorical, sometimes catastrophic – a loss not just of income but of independence and dignity.

Nor does protectionism offer escape from this dilemma. Shutting out China and the others deprives less well-off Americans of access to the kinds of goods once reserved for the upper classes: quality clothing, furnishings, electronics, durable goods – from the Taiwanese-manufactured smartphone to the affordable, highly functional Kia.

Globalization taketh away. But it giveth more. The net benefit of free trade has been known since, oh, 1817. (See David Ricardo and the Law of Comparative Advantage.) There is no easy parachute from reality.

Obama calls this a race to the bottom. No, it's a race to a new equilibrium that tries to maintain employment levels, albeit at the price of some modest wage decline. It is a choice not to be despised.

I have great admiration for the dignity and protections trade unionism has brought to American workers. I have no great desire to see the private-sector unions defenestrated. (Like FDR, Fiorello La Guardia and George Meany, however, I don't extend that sympathy to public-sector unions.)

But rigidity and nostalgia have a price. The industrial Midwest is littered with the resulting wreckage. Michigan most notably, where its formerly great metropolis of Detroit is reduced to boarded-up bankruptcy by its inability and unwillingness to adapt to global change.

It's easy to understand why a state such as Michigan would seek to recover its competitiveness by emulating the success of neighboring Indiana. One can sympathize with those who pine for the union glory days, while at the same time welcoming the new realism that promises not an impossible restoration, but desperately needed – and doable – recalibration and recovery.

© 2012, The Washington Post Writers Group

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8 Comments

Tod the tool guy in brooklyn ny said:

Lower wages, are preferable to NO wages, which is what hostess private sector union selected. "Choice and competition,upward mobility, profit motive, right to contract, blessed private sector!"

Friday, December 14, 2012 at 5:38 AM

Kevin from Arkansas in USA said:

"...In right-to-work states, the average wage is about 10 percent lower."

Cost of living is also lower in Right to Work States.

Friday, December 14, 2012 at 8:31 AM

Joe in Texas replied:

Exactly. So are taxes. Along with regulations.

Friday, December 14, 2012 at 1:16 PM

Rod in USA replied:

I would LOVE to see an empirical study of this: If the cost of living is lower (and perhaps the standard of living higher), then the wage reduction is absolutely irrelevant.

The reason the unions and libtards are crying is that the unions lost power, as in cash, to dole out to libtard congressman. So what was once a union member being fleeced in a mob-style protection racket to transfer the cash to some fat cat, now it is money in the worker's pocket AND the freedom to choose how to spend it.

Friday, December 14, 2012 at 1:21 PM

Kevin from Arkansas in USA replied:

I was challenged on this same subject on another blog. I told the challenger that my brother living in a closed shop state while I live in a right to work state. Even though he made more money than I did during his and mine working career I lived better and retired at 59 while he still struggles. I found a calculator on the CNN website. The challenger allowed me to use the capital cities of each state. Albany, NY and Little Rock, AR. The calculator said it was 14% cheaper to live in Little Rock than Albany.

http://money.cnn.com/calculator/pf/cost-of-living/

Friday, December 14, 2012 at 4:42 PM

Patriot Pat in in Pacifica said:

Once again, a sobering, logical explination of just what is going on in this
nation - reality. As this brilliant man Dr. Krauthammer explains, the so-called glory days are over. The only way we can compete now is by using our inguinity - and eliminating not cushing rules . We can be great again. Hoo Rah!

Friday, December 14, 2012 at 12:02 PM

wjm in Colorado said:

But clearly the wage, benefit and work-rule gap between the unionized North and the right-to-work South was a major factor.

So is the production of Crap! Union made Government Motors Cars are junk. If it is union made, it is not worth the purchase price, they have to be made cheper to complete with a better car produced by a non union shop with reduced labor costs.

Friday, December 14, 2012 at 2:51 PM

JTG in Indiana said:

Note to Obama: Getting the 17% of unionized labor in Michigan to join the 83% of non-union workers would be bringing those 17 percenters to your form of social justice. You will have to look for puiblic sector unions to up their dues to make up for what will amount to about a 40% reduction in union dues that will be collected as forced particiaption has gone by the wayside.

Monday, December 17, 2012 at 5:26 PM