The main function of a labor union is to coerce its members

In 1967 I was a route salesman for Rainbo Bread Company. I guess I’m rich now by comparison to what I was making then, but I’ve never felt richer than I did then. My income was almost all commission based on the number of loaves of bread I sold. I made good money because I learned how to sell bread. And I worked hard at it because the harder I worked the more money I made. It was directly proportional.

The first thing you need to sell bread is shelf space. The first thing you need to get shelf space is a good relationship with the person who controls how much shelf space you have in his store. So, once you properly schmooze the shelf space owner the next thing is too service that space very well. If you’ve done a good job of making the shelf space guy like you, he’ll let you put some extra product in the back room of his store so you can go back to the store in the late afternoon after you’ve taken your truck back to the bakery, and pull some more bread out of the back to refill all the wonderful shelf space he’s given you. That’s how you sell lots of bread and makes lots of money. Well, at least in 1967. The times may have changed since then.

So one evening about 7:00 PM I’m in a grocery store bringing my extra bread out of the back room to fill up my shelf when I get a tap on the shoulder from a greasy looking guy about 4 feet tall. I thought he was a cop because the first he did was flash a badge. When he spoke, he said, “All right buddy, you’re busted.” On closer look the badge said, “Teamsters’ Union Master at Arms.” He didn’t have a gun, just an attitude. Yeah, to be a route salesman you had to drive a truck and therefore you had to belong to the Teamsters Union. It wasn’t a choice, it was union shop rules.

Turns out there was a rule against any route salesman being in a store doing anything with his shelf space after 4:00 PM. It was $100 fine if you got caught. The company had to take it out of my paycheck and give it to the union. Nothing I could do about it. I decided then and there that unions are a fraud that enriches the gangsters that run them and exist to protect the laziest workers. See, if I was out there hustling bread from 5:00 AM to 7:00 PM I was going to be taking sales from other route salesmen who wanted to get home at 4:00 PM in the afternoon.

It was the same principle as when store owners lobby for laws controlling store hours. It’s using the force of government to stifle competition. In this case it was the force of the Teamsters Union to force me to work less so others wouldn’t have to work more. Of course, they didn’t have to work more just because I was. They just didn’t want to have to compete with a workaholic who wanted to make as much money as he could as fast as he could. To them I wasn’t ambitious, I was greedy. To me, they were lazy and manipulative.

That’s what unions do. The coerce their members not to work hard.

In his book The Constitution of Liberty, F.A. Hayek wrote in 1960:

“It cannot be stressed enough that the coercion which unions have been permitted to exercise contrary to all principles of freedom under the law is primarily the coercion of fellow workers. Whatever true coercive power unions may be able to wield over employers is a consequence of this primary power of coercing other workers.”*

Professor Donald Boudreaux of George Mason University recently wrote:

The myth is that unions benefit all workers.  But because unions in practice raise wages only by artificially restricting the supply of labor, the reality is that unions benefit some workers chiefly at the expense of other workers – other workers who are either coerced to join unions or who are forcibly prohibited from working at jobs, or on terms, of their own choosing.

By the way, I didn’t stop working my stores at night.  I just stopped getting caught.  It was fun and it paid well.

A tidbit:  The wholesale price to the store in those days was 28 cents a loaf, the suggested retail price was 35 cents a loaf.  K-Mart’s had grocery sections in those days and sold it for 33 cents.  A recent loaf of bread I bought was $3.99, although there was some “cheap” stuff for $2.99.  The minimum wage then was about 2.5 loaves of bread an hour, and that’s about what it is now (for the cheap stuff).  That means the fine for the transgression of setting my own work hours was roughly 1,500 300 loaves of bread.  I wonder what it is now?

  • Dave Lienert

    Ken,
    I find myself agreeing with you on an overwhelming proportion of subjects.
    However this is a tough on for me. I know first hand that not all unions are the same.
    As you know I am a, and employ union electrician(s). Our union is a craft and skill union which may help explain the difference. If one does not possess the skill or work ethic of a trained craftsmen our union will not protect that worker from being fired. It exists to train new and existing workers and for collective-bargaining of wages and benefits only.
    I was also once a member of the Teamsters union. I was directly out of high school and belonged for about one year. The contrast between these two unions could not be stronger. Labor and management were diametrically opposed on all issues. When questioning union rules the best answers I would get were simply “because” nothing further. Ignorance seemed to be the rule.
    I imagine we both have examples of why unions are good or bad. At least I hope that that one issue from 1967 did not taint your entire perspective.
    Indeed many unions must change or they will fail they are losing members and have been losing members for decades. In the end I imagine markets will decide if unions will stick around or if they will fade into the history books.

    • TeeJaw

      Dave, I’d submit that protection from being fired is a false promise that makes it harder to get hired in the first place. Employers have a strong economic incentive to keep their most productive workers happy and well paid.

      • Dave Lienert

        Well said Ken. I couldn’t agree with you more. Any protection from being fired is a kin to asking someone not to do their best.

        • TeeJaw

          If you are an employer you will be frightened of hiring someone you cannot fire if they aren’t doing the job. You cannot predict how someone you hire will work out but you will be more likely to take a chance on them if you know you will have a remedy if it’s needed. This is a huge factor in the stubborn unemployment rates of the E.U. which now has generations of slackers who will never be productive self-actualizing individuals. Politicians are perfectly happy with this state of affairs because drones are easier to control and manipulate.

  • Ken Spiker

    Look what unions did to Detroit. Not only do they exploit workers, they ruin industries and spend the workers’ dues on politicians, not on defending the workers. I think what Dave is talking about would be something like guilds–professional organizations like bar associations.

    • TeeJaw

      Government unions do the most damage as shown in Detroit. A government union is a money laundering scheme whereby politicians and government union leaders and workers fleece the public who have no say in anything they do.

    • Dave Lienert

      I believe blaming unions for the downfall of Detroit is only part of the tragic story. We had three major car companies that didn’t believe anyone in the world could build a better car. Not so! Trade unions have a 100% hold on the German car manufacturers. BMW and Mercedes embraced change. This may have more to do with a differing attitude. In Germany labor and management seem to work closer together for a common goal. Please note this is not so other parts of Europe (France is a joke as well as their auto industry).
      Yes unions can and do over reach at times. Thank ( choose your higher power here), the market can still correct itself on its own.
      Unions, Individuals, Corporations and Countries will each rise or fail if they work or become useless.