Do Unions Add Value?

One of my favorite labor commentary sites is Working Life, where Jonathan Tasini writes on all sorts of topics. I can usually count on him to raise my blood pressure, and get me thinking. Anyway, he took on the auto negotiations yesterday:

You see, there are actually plenty of auto jobs, here and abroad. But, they increasingly are NON-UNION jobs. The auto industry is growing in the U.S.--but it's growing in the South, it's growing non-union and it's growing with wages and benefits far lower than the average wage of a current auto worker.

The ultimate goal, from the corporate end, in the auto negotiations is to survive--and, then, proceed on the merry road the companies have embarked on for some time now: rid themselves of the union and the cost structure that good unions jobs entail. It makes perfect logical, financial sense. That it is a disaster for working Americans is not their concern.

I am not sure that this development is a disaster for working Americans. It's working Americans that buy the cars that will be more affordable if they can be produced for less. If people who buy cars saw value in union-made automobiles, they would pay more for them. If that was the case, the Big 3 wouldn't be in the fix they're in.

In any event, as I posted over there, the UAW (and American workers in general) are like a grocery store owner selling a can of tuna for $2, that you can get down the street for $1. If you want to get paid more, you'd better be selling better tuna. I think it's clear that for a lot of products, producing in America (as opposed to, say, China) is worth the higher cost. Manufacturers in all kinds of industries have proved that over the past ten years. The standard of living enjoyed in America as opposed to other places isn't a birthright -- if we don't continue to add more value than the other guy, we can't expect to get paid more and live better than him.

What's less clear to me is the value that organized labor provides. If you want to get paid more for making cars than your non-union brethren down south, you need to be doing it better or your pay can't be sustained. The marketplace will quickly take care of disparities, and is doing so with a vengeance.

By the way, I think you can make a case that unions do add value to productive enterprises, at least sometimes. Considering how much they use in resources, they'd better be.