Since the start of the Industrial Revolution and capitalism, wage rates have risen steadily—as an inevitable economic consequence of rising capital accumulation, technological progress, and industrial expansion … It was the economic self-interest of employers that led them to raise wages and shorten working hours—not the pressure of unions.

—Nathaniel Branden. Capitalism: The Unknown Ideal, 1966.

In a free country, anyone dissatisfied with his job conditions can pick up and leave. If the government is not interfering with the economy, he will quickly find work elsewhere. This freedom forces businesses to compete for conscientious employees by offering ever-increasing wages and ever-improving working conditions to the extent they can afford to do so. Thus average wages naturally rise as the wealth of the nation rises. The wealth of a nation increases as investment accumulates. Contrary to popular myth, the wealth of a nation is not increased by allowing unions to extort from employers. If that were true, Third World countries could strike their way to prosperity.

How unions breach the rule of law

The forcible occupation of another man’s property or the obstruction of a public thoroughfare is so blatant a violation of rights that an attempt to justify it becomes an abrogation of morality. An individual has no right to do a ‘sit-in’ in the home or office of a person he disagrees with—and he does not acquire such a right by joining a gang. Rights are not a matter of numbers—and there can be no such thing, in law or in morality, as actions forbidden to an individual, but permitted to a mob.

—Ayn Rand. Ibid.

A strike is a deliberate conspiracy to cause economic harm to a business. As such it cannot be properly characterized as an individual exercising his right to resign his employment. Rather it is a collective effort to cause economic harm to someone else’s property. While individuals have the right to resign, they do not have the right to pursue a conspiracy to cause economic harm to a business. As they do not own the business, they have no right to try to force decisions on it—any more than any other racketeers have the right to force businesses to pay them money. As for picketing, the practice is nothing less than thuggish intimidation in breach of laws against riot, loitering, assault and trespass.

Trade unions can have unobjectionable roles, such as friendly societies genuinely concerned with the welfare of their members. They can also present complaints to management and to government about safety and health issues. However, when they use violence, intimidation, or conspiracy to harm a business, or to harm or intimidate individuals employed by it, their behavior becomes a racket and those participating should be prosecuted.

The granting of extra-legal privileges to unions was a mistaken fork in the road in the course of human civilization. Mankind must now retrace its steps by subjecting trade unions to the same laws that govern everyone else in society.

How unions are destroying the West and causing the rise of China

When a business must pay more for labor than its competitors, it soon goes bankrupt. This is because customers take their business to the lower-cost, union-free competitors. To address this, unions have evolved so that they seek to control entire industries. Once they control an industry, they can increase wages above the market by forcing business owners to inflate prices throughout the industry. This means it is not the businesses in question that ultimately pay for the extortion fee, but the public at large. It is thus the public which supports the uncommercial high wages of union members and the networks of corruption and patronage ruled over by union bosses.

The advent of the global economy has changed things somewhat. Now the public has an escape route—it can avoid union extortion by buying foreign goods. This is causing union-controlled industries to slowly die out. The U.S. auto industry is a prime example. Buried beneath impenetrable layers of union extortion, it simply cannot compete with foreign manufacturers. The only unionized industries flourishing today are those physically immune to Asian competition, such as the trucking and building industries.

Thus, in a union-ridden country the prices paid by the public for immovable goods and services are excessively high and it is impossible to make competitive movable goods. This means countries like the United States become relatively impoverished as they transfer their capital to China. Thus the rights and benefits ‘secured’ by unions are for jobs that, as a result of agreeing to those conditions, no longer exist.

How everything unions do is based on coercion

In the first place, the unions rely—to a much greater extent than is commonly recognized—on the use of the picket line as an instrument of intimidation. That even so-called peaceful picketing in numbers is severely coercive and the condoning of it constitutes a privilege conceded because of its presumed legitimate aim is shown by the fact that it can be and is used by persons who themselves are not workers to force others to form a union which they will control … The aura of legitimacy conferred upon it because the aims are often approved cannot alter the fact that it represents a kind of organized pressure upon individuals which in a free society no private agency should be permitted to exercise.

—Friedrich Hayek. The Constitution of Liberty, 1960.

Unions do not offer anything to which others freely consent. Rather, they act by coercion and the threat of coercion. This is focused on two targets: first, businesses painstakingly built up over many years are threatened with destruction unless they meet the union’s demands. Second, workers are threatened, often with violence, should they refuse to join the union. The whole concept of the picket line, whereby jeering, bus-rocking, punch-throwing thugs seek to intimidate their workmates, is abhorrent to civilized society and should be relegated to history—as lynch mobs have been. Natural justice requires that everyone be able to go peacefully about their lawful business without being stalked, harassed, assaulted, or intimidated. The only person a free man should fear is a police officer, and then only if he breaks the criminal law, or a bailiff, and then only if he cannot pay his debts.

One hundred years ago Herbert Spencer described how unions operate, and the description is as accurate today as it was then:

‘Be one of us or we will cut off your means of living’, is the usual threat of each trades-union to outsiders of the same trade … the freedom of those who disagree with them is not only denied but the assertion of it is treated as a crime. Individuals who maintain their rights to make their own contracts are vilified as ‘blacklegs’ and ‘traitors’, and meet with violence which would be merciless were there no legal penalties and no police. (From Freedom to Bondage, 1891.)

How can someone righteously be called a traitor because he does not wish to resort to coercion in negotiating his wage? When people are intimidated into joining an organization, it ceases to be a voluntary association and instead becomes an empire. There is nothing new about the imperial model; it is as old as violence itself. Starting from a small nucleus, the empire sets out to bully people into joining. The new ‘members’ are then utilized to increase the power of the organization so it can bully even more ‘members’ into joining. The imperial model represents the acme of evil.

Unions are not representative—no organization based on coercion can be

Along with this aggressiveness in one direction there goes submissiveness in another direction. The coercion of outsiders by unionists is paralleled only by their subjection to their leaders. That they may conquer in the struggle they surrender their individual liberties and individual judgements, and show no resentment however dictatorial may be the rule exercised over them.

—Herbert Spencer. From Freedom to Bondage, 1891.

A union is a body of people who have turned their back on consensual agreement and, like the Bolsheviks who stormed the Winter Palace, have opted to take what they want by force. Any group which relies on force can succeed only if it has a strict chain of command, with severe penalties for dissidents and deserters. The leadership evolves into a small committee and then, within that committee, control is wielded by one or two all-powerful dictators. Any pretense of democracy becomes a farce, as the official line is laid down by these rulers, partly through intimidation, and partly thanks to mindless subservience. The leaders no more represent their members than Caesar represented his soldiers. It is unhealthy for any free society to harbor these coercive organizations run by despots, whose grant of extra-legal privileges encourages them to think they are above the law.

Unions must be denied special privileges

Trade unions were strengthened with special privileges. Employers’ rights to hire and fire, or indeed to manage, were subject to a tangle of regulations. And, of course, the effect was quite the opposite of that intended, or at least of that proclaimed. Trade union leaders bullied firms into bankruptcy and workers into the closed shop, and insisted on self-defeating restrictive practices. New firms shut down. Large firms wouldn’t expand.

—Margaret Thatcher. The Fourth Nicholas Ridley Memorial Lecture, London, November 22, 1996.

Carried out within the rule of law, reforming trade unionism does not involve passing persecutory laws or preventing membership of voluntary associations. Rather, it simply involves applying the same laws to members of trade unions that apply to everyone else. This means:

  • Revoking unions’ special privileges and exposing them to tort law and laws against riot, loitering, affray, assault, conspiracy, racketeering, breaking and entering and trespassing. Legislation such as the proposed Freedom from Union Violence Act (U.S. Congressional Bills of 1997 and 2007.) is unnecessary for the same reason hate crime laws are unnecessary: the motive for a crime is irrelevant. The important thing is that all people be subject to the full rigor of the law when they assault, cause property damage or extort.
  • Repealing legislation designed to assist unions to coerce employers. These include laws:
    • Permitting closed shops
    • Preventing employers from hiring replacements for striking workers
    • Providing unemployment benefits for people on strike
    • Requiring employers to divulge home addresses of employees to unions
    • Allowing trade unions to record home addresses of members,
    • Requiring employers to collectively bargain
    • Preventing employers from dismissing union members
    • Requiring employers to allow union officials on site or to inspect their books
    • Preventing employers from offering inducements not to join unions
    • Preventing employers from hiring non-union labor.

On the other hand, strikes and picketing are moral, and should be encouraged, when governments seek to force people to work. Wherever the most sacred property of them all—property in the fruit of your own labor—is violated, industrial rebellion becomes a political duty and ceases to be an infringement of the employer’s property rights, since it is just and proper mutiny against slavery.

The proper role of trade unions

Unions can lobby for regulations to address safety issues that concern their members. Where the government does not enforce safety regulations, the unions can run advertisements at election time seeking to sway the political debate or bring proceedings against the government for dereliction of duty.

If their members deem it advantageous, unions can provide fraternal benefits to their members. These include health funds; retirement funds; savings and loans; medical, unemployment, and injury payments; nursing home care; child care centers; education scholarships and the like. In most cases, however, these services will be best obtained commercially or from other friendly societies or religious organizations. It is a question for the market and individuals to determine.

This article is an extract from the book ‘Principles of Good Government’ by Matthew Bransgrove