Law vs bargaining power

Was the defeat of trades unions in the 1980s really such a great victory for free market liberalism?
The campaign to give temporary and agency workers the same legal rights as full-time ones raises this question.
What it shows is that campaigners now try to to protect workers not through organized unions but through the law. What used to be done by unions is now done in parliament, with minimum wage or health and safety laws or the proposed agency workers' bill.
The problem is, though, that the law is a much blunter weapon than unions. Take agency workers. Some of these, as Johann shows, are genuinely being ripped off. Others, as the CBI claims, are workers who value the variety of work that temping offers. The law cannot distinguish the two. In principle, though, trades union organization could. A stronger union movement would protect exploited agency workers, whilst not throttling happier agency workers in red tape. Similarly, whereas legal minimum wages don't distinguish between areas of low and high labour costs, or between sectors with elastic and inelastic demand for labour, a sensible strong labour movement could.
In this sense, those who want the state to butt out of the labour market should regret the decline of unions, as the gap these have left has been filled (partly) by crude laws.
Workers' bargaining power can be a substitute for the law.
And here's where there's (yet another!) case for a basic income. As this would give workers an income regardless of whether they worked or not, it would increase their bargaining power and thus reduce the need for labour market laws. With a basic income, workers would be freer to take or leave agency jobs, low-paid or dangerous work. So there'd be less need for legal protection.
So, if you want a free market, one way to get there is to empower workers to be able to take or leave bad jobs.
But then, we know why this option gets such little consideration, don't we?

Comments

[Jock]

There's a quotation from some nineteenth century Liberal woman which I can't place right now, to the effect that "any attack on the trades unions is an attack on the free market". It's quoted in Conrad Russell's "Intelligent Person's Guide to Liberalism", which is at home.

[Jackart]

Nice, if it were anything other than wishful thinking, but the Unions would use their power to demand laws, so we get the worst of both worlds.

Remember the Unions are run by people like Scargill and Crow, not people who actually have anyone's actual interests at heart, just some vague notion of class war.

But you're all for that, aren't you?

[Cleanthes]

"a sensible strong labour movement "

But just as the free market has its excesses, your problem is having a strong labour movement that is able to remain sensible.

A strong free market is, rather by definition, a distributed affair. By contrast, strong unions centralise power. In the past, that has served to preclude such unions - or rather their leaders - from being sensible.

[Mark Wadsworth]

What Jackart says. TU membership has more or less died out in private sector - it largely overlaps with public sector, i.e. gummint-backed job creation schemes. Trade Unions are historically not for benefit of part time or temporary workers at all.

I prefer the Basic Income argument, that's much simpler and solves a lot of other problems as well.

[dearieme]

This reads as the view of someone who has never had first-hand dealings with unions.

[William]

"a sensible strong labour movement"

ah, that's the problem. They once were sensible, but people (including many workers) turned against them and they lost power because they stopped being sensible.

[Phil]

"A strong free market is, rather by definition, a distributed affair. By contrast, strong unions centralise power."

The words you're looking for aren't 'centralise' and 'distribute' but 'concentrate' and 'atomise'. As Ken Macleod pointed out in another context recently, "the liberal theory of the state allows intermediate corporations - it just doesn’t want them incorporated in the state". Libertarianism a la Cleanthes doesn't want intermediate corporations at all.

[JohnM]

Surely this is where the argument for a CBI breaks down since so many exploited agency workers are non-nationals, they would qualify for it. This is the biggest objection that I can see to the CBI: it doesn't sit very comfortably with mobile populations.

[JohnM]

That should be 'would not qualify for it', naturally.

[Planeshift]

"Others, as the CBI claims, are workers who value the variety of work that temping offers."

Honestly, why do the CBI put out bollocks like this that is only really believed by 5 year olds and economists?. Most adults with rents/mortgages/families would anyday rather the higher wages and security of permanent jobs. The people for whom agency work is likely to be preferable are going to be people like students for whom occasional temporary work around their studies is valuable and helps them build experience and contacts. The CBI should focus upon this to make its case, and also campaign agaignst stupid incentives and regulations that mean the unemployed cannot realistically take temporary work from agencies.

Furthermore one aspect overlooked in the debate is that many agencies recruit foreign workers for jobs here (whilst ignoring local people) because they can be more easilly exploited. Perhaps those people opposed to liberal immigration controls should consider this aspect of agencies.

[tom s.]

"A strong free market is, rather by definition, a distributed affair. By contrast, strong unions centralise power."

So Shell, Wal-Mart etc are "distributed" compared to "centralized" unions? Odd definitions of those terms.

[Jim]

Quite, tom s. I don't want to get into the Tesco-bashing rubbish, but when you have a full one-third of the retail spending a country going through one company's books, well, that sounds rather like a definition of 'centralised' to me.

[ad]

As far as I recall, the terrible fate inflicted on unions in the 1980s was to have some of their legal immunities withdrawn and be required to ballot their members on strikes etc.

Which of these does Chris object to and why?

“So, if you want a free market, one way to get there is to empower workers to be able to take or leave bad jobs.”

This is the argument for one of those flexible labour markets we hear so much about. The less risky it is to hire someone, the easier it is to get hired. And that increases your bargaining power with your existing employer. You decrease the power of current employers, by making other potential employers more willing to hire.

“But then, we know why this option gets such little consideration, don't we?”

Because it cannot be used to increase the power, or feed the self-righteousness, of any influential group. Laws, unions and benefits systems can do both.

“only really believed by 5 year olds and economists”

Planeshift, if a claim about , say, chemistry, were believed only by 5 year olds and chemists, this would be pretty good evidence that the claim was perfectly true, but contradicted the prejudices of everyone who knew little about chemistry.

[Planeshift]

Replace the word 'chemistry' above with 'sociology' (or if you're a sociologist try astrology, homeopothy etc) and see if it has the same rhetorical impact.

Or just take the comment as a flippant remark designed to get a response.

[Bruce]

Unions are not interested in the welfare of temporarary workers. Their backing for getting more benefits/rights for temps is entirely self-interested in that it will create an additional cost for employers who use temps (for whatever reason). The unions can then demand more money for their members to ensure that suitable differentials are maintained.

[Alex]

TU membership has more or less died out in private sector - it largely overlaps with public sector, i.e. gummint-backed job creation schemes.

What utter bollocks. (Off top of head: Tesco, BT, Rolls Royce, the entire rail sector, C&W, most of the banking sector, most of the energy sector...so nothing of any significance is unionised. Nuh. Oh, some of those companies actually do something useful, so in toryland they don't count. Forgot that for a second.)

[Mark Wadsworth]

Alex, I quote from here

http://www.eurofound.europa.eu/eiro/2007/07/articles/uk0707039i.htm

"The differential between the private and public sectors is particularly striking. In 2006, according to the report, only 16.6% of private sector employees were union members ... In the public sector, union density was more than three times higher, at 58.8% of employees in 2006 ... Private sector employees accounted for 58% of all trade union members.

NB - that 58% is because the private sector is three times as large as the State sector.

[Jim]

16.6% == 'more or less died out'

Er, interesting analysis, that. Back on the supermarket analogy, Asda & Sainsburys are moribund by that standard.

[reason]

Yes to the basic income point.
No to trade unions, at least as they were. The problem was whos interests they represented. Very often it didn't correspond very closely to the interests of individual workers. Where unions DID really help workers, it was via the political process. But unions as a block were also a hinderence to the political process because they diluted the influence of individual blocks of opinion by filtering it through the TUC.

[reason]

You may be interested in this by the way:
http://worthwhile.typepad.com/worthwhile_canadian_initi/2008/02/on-the-politica.html

[Mark Wadsworth]

Jim, yes, I exaggerated a bit. So what?

[Jim]

So what?

16.6% != 'more or less died out' what.

[Mark Wadsworth]

All right then "16.6% = dead as a f***ing dodo"

[Jim]

What, like Asda?

Alex called you right first time, mate.