–The single biggest reason labor unions struggle.

Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor,
which leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
●To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive.

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American labor unions should enjoy the sympathy and backing of the American public. Unions are “for” the common worker, “for” higher wages, “for” better working conditions and “against” the rich. What could be wrong with that?

Why then, has union membership declined?

Bureau of Labor Statistics
In 2012, the union membership rate–the percent of wage and salary workers who were members of a union–was 11.3 percent, down from 11.8 percent in 2011. The number of wage and salary workers belonging to unions, at 14.4 million, also declined over the year.

In 1983, the first year for which comparable union data are available, the union membership rate was 20.1 percent, and there were 17.7 million union workers.

Many reasons have been offered for this decline, not the least of which has been notorious, rampant greed and dishonesty among union leadership. Additionally:

Why Has Union Membership Declined?
UC Berkeley’s Claude Fischer

-American workers did not need to organize because they flourished without unions;
-American workers were divided by ethnicity and race in ways European workers were not;
-employers in the United States were unusually powerful … and got governments to crack down on unions (the notorious cases involve state governors using the National Guard to break strikes);
-the American dream of self-employment distracted workers;
-the American electoral system prevented a labor party from growing;
-Americans’ individualism led them to reject collective action;
-Unions face critical “free-rider” problems if membership is totally voluntary. For example, I could benefit from the union’s effort to improve working conditions at my workplace without paying dues

There may be one reason that transcends all. The reason is hinted at in the following excerpts from a post on the AFL-CIO’s own blog.

How Corporations Use Offshore Havens to Avoid Paying Their Taxes
04/24/2013 Kenneth Quinnell

Current laws in the United States allow corporations to use offshore havens to avoid paying their taxes and, if it’s up to many in Washington, the problem will only grow larger.

Tax laws encourage the offshoring of America’s jobs, which has led to the hollowing out of the middle class.

The United States has the third-lowest effective corporate tax burden in the world. Corporate taxation as a share of total tax revenue was 26.4% in 1950 and was down to 7.4% in 2010.
Personal income, Social Security and Medicare taxes were 51.4% of total tax revenue in 1950, now they are up to 83.4%.

Congress is now proposing lowering corporate taxes even more.

See the problem? Rather than demanding reductions in domestic taxes, AFL-CIO believes all corporations – including those organizations that hire and pay union members’ salaries – should pay more taxes.

If AFL-CIO is saying federal tax laws are bad, I agree. If AFL-CIO is saying people pay too high a percentage of their income in taxes, I also agree. But will raising domestic taxes make American businesses more competitive, or encourage American businesses to hire more people, or increase union membership, or benefit union members? No.

Historically, unions have favored employee inefficiency as a way to increase payrolls. (One example: Unions in Chicago’s convention center, McCormick Place, demanded even the most trivial tasks be performed by union members, then charged exorbitant rates. Only when conventions threatened to go elsewhere, did the unions relent.)

McCormick Place union deal reap rewards: Trade show, hotel work
Chicago Sun Times
Fran Spielman, City Hall Reporter

Newly-negotiated union concessions at McCormick Place paid quick dividends on Friday when a major trade show locked in for 2013 and 2015, and a major hotel chain authorized $125 million in renovations.

The union concessions will create an “exhibitors bill of rights” that lets show managers and exhibitors set up their own booths with simple tools.

Exhibitors also can drive and unload their own vehicles at McCormick Place, and union work can be done by two-person crews instead of the old three-person minimum.

The overall result: More work for union members, and not just in the convention center.

For understandable, historical reasons, unions indoctrinate their membership to be anti-business. The focus has been on maximizing employment and wages, rather than on increasing business health, which as a result. would help maximize employment.

It’s as though there were the belief, “the more difficult we make life for businesses, the more people they will hire.”

Not that businesses are innocent. On the contrary, unions exist because businesses exploited workers. But unions are fighting a losing battle.

In this Supreme Court, “Citizens United” world, where corporations have the same rights as people, and can bribe politicians as much as they wish, business simply has too much money and firepower for the unions.

The salvation of the union movement will be in adopting a willingness to help American business be more competitive, rather than asking all business to pay higher taxes, and hoping that will result in salary increases.

Better that the unions should demonstrate their value to businesses by standing shoulder to shoulder with them, and demanding that Congress reduce or eliminate business taxes.

No, cooperation won’t guarantee all businesses will become union-friendly. But cooperation will be more productive than contention for both sides. Unions should assist in efforts to make union members better trained, more willing, more productive workers, rather than exhibiting a “do-the-least, demand-the-most” attitude.

Unions should reward the union-friendly companies and save the contention for those individual companies that truly deserve it. American unions need healthy American companies. The union leaders should ask, “What are we doing, and what can we do, to nourish the goose that lays our golden eggs?”

Message to unions: If you can’t beat ‘em, join ‘em. And; you can’t beat ‘em. So, learn Monetary Sovereignty and learn the reasons WHY federal business taxes and personal taxes can and should be cut.

Learn how to feed the goose so the goose can feed you.

Rodger Malcolm Mitchell
Monetary Sovereignty

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Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Medicare — parts A, B & D — for everyone
3. Send every American citizen an annual check for $5,000 or give every state $5,000 per capita (Click here)
4. Long-term nursing care for everyone
5. Free education (including post-grad) for everyone
6. Salary for attending school (Click here)
7. Eliminate corporate taxes
8. Increase the standard income tax deduction annually
9. Increase federal spending on the myriad initiatives that benefit America’s 99%

No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. Two key equations in economics:
Federal Deficits – Net Imports = Net Private Savings
Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports

#MONETARY SOVEREIGNTY

6 thoughts on “–The single biggest reason labor unions struggle.

  1. Congratulations on your unwavering correct position vrs. R&R.
    Let’s hope for the same success here since you would say, perhaps wone of the best ways to help Both labor and business would be: “1. Eliminate FICA (Click here)” Let’s hope soon .

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  2. There was a time when unions were a helpful response to corporate misbehavior, but unions today exist for the benefit of the union bosses. When I was a union member making minimum wage they took more than a week’s paycheck every month for union dues, and their only involvement with my employment conditions was to prevent the company from giving me a raise. Unions are famous for featherbedding, and today they survive only in industries where all employers are unionized. There may be a niche for a different kind of union, one that is voluntary and provides services for employees that the company could, but doesn’t, provide. Maybe education, supplemental health insurance, child care. The repetitive assembly line sort of work that gave birth to the union movement is all but gone. In the age of the knowledge worker, the idea of a single wage for all workers is obsolete.

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    1. I agree. Unions have considered their strength to be the strike and their goal to be less work and more pay for everyone. That strength and goal has become obsolete.

      The strike should be a last resort, and the goal should be to strengthen companies via a combination of political muscle and business efficiency.

      Today, the strength of unions should be in their ability to provide the best employees. They must become more like trade schools, with a focus on training and employment.

      They should be able to assist “unionized” companies to out-compete non-unionized companies. They should be a positive, not an negative, force.

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  3. [1] Rodger says: “Will raising domestic taxes make American businesses more competitive, or encourage American businesses to hire more people, or increase union membership, or benefit union members? No.”

    Nor will raising the minimum wage help workers. If you want to give workers a raise, then why not eliminate the FICA tax? Why not eliminate federal corporate taxes, so that corporations move back to the USA, thereby creating jobs? (The more jobs we create, the more bargaining power we create for workers.)

    If you don’t want to cut taxes, then we must increase government spending. Otherwise, an increase in the minimum wage can only hurt workers, just as an increase in federal taxes on corporations can only hurt workers.

    [2] Rodger says: “Unions indoctrinate their membership to be anti-business. The focus has been on maximizing employment and wages, rather than on increasing business health, which as a result would help maximize employment.”

    I think that’s only true in some cases. Unions tend to move toward one extreme or its opposite. At one extreme, union members become greedy, lazy, and ultimately suicidal (e.g. Unions in Chicago’s convention center, McCormick Place).

    At the other extreme are unions that do nothing but make union bosses rich. In this latter case, the union boss continually says, “You must accept lower wages and no benefits, or the owners will move the factory.”

    In this case the boss’s job is to maintain not the strength of workers, but their submissiveness. Golfer1john describes this type of union above.

    The type of union (too greedy, or not greedy enough) depends on the case, and the situation.

    That said, Rodger is correct: regardless of the situation, union members hurt only themselves when they call for higher corporate taxes.

    I think that owners pay union bosses to call for higher corporate taxes, which big corporations don’t pay anyway. To demand higher taxes is to maintain the illusion that tax revenue pays for the federal government. The illusion keeps the peasants in a submissive trance. That’s why Democrats always call for higher taxes. (Unions are almost always pro-Democrat.) Democrats do this to pose as defenders of the victims they impoverish.

    Ultimately, unions are losing ground for the same reason the general public is losing ground. What is that reason?

    Mitchell’s Law #6: the penalty for ignorance is slavery.

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