A Bloomberg Christmas story

Amity Schlaes shares a woeful tale at the Bloomberg site today.

All about how unions are to blame for wage inequality.

Now, I agree with this to a point. Many unions have certainly acquiesced to employer's demands for two-tiered wage structures. In the long run, as the grandfathered employees retire, eventually the entire work force will be covered by the lower of the two tiers.

It ends up a slow-motion wage cut across the board.

At the same time, this is not "promoting wage inequality."

What got Schlaes' attention was the fact that security guards at JFK were threatening a strike over their $8/hr pay packet, a strike that might even render the travelling public unsafe!

Fortunately for the travelling public, the security staff rescinded their strike threat and the public can now continue their carefree travels, secure in the knowledge that their safety is in the good hands of the $8/hr folks at JFK.

Schlaes then segues into a largely pointless back-story on the history of public sector unions in America and comes to some startling conclusions. Giving public servants the right to strike has led to State Troopers making $484,000 a year, and an unknown number of union officials at the Port Authority of New York and New Jersey earning $200,000 per year.

In Schlaes' tortured reasoning, those underpaid $8/hr workers cannot be paid more because of those $200,000 a year union officials.

Schlaes neglects to mention that those 8 dollar an hour folks are already union members, which in itself is a searing indictment of the efficacy of union strategies in today's America. Whether their leadership at the SEIU are among those "overpaid" union bosses is not a fact that Schlaes informs us of.

Frankly, any union leader who negotiates an $8 wage for their members in this day and age should hang his or her head in shame and hand the reins to someone willing to work harder for the membership.

The premise that there is a strictly limited pool of money available to pay labor flies in the face of the last hundred years of labor relations. The key to deciding who gets what share of the pie is what "negotiating" is all about. That's why talks between unions and employers are called "negotiations."

The thrust of Schlaes' "Christmas story" becomes clear; there is no need to negotiate. If workers want a raise they should fire their union leaders and divvy up their pay packets amongst themselves.

Schlaes doesn't want to re-write the "grand bargain."

She wants to get rid of it entirely.