Garbanzo Toons

A View on Labor Unions

Milton and Rose Friedman, in their book, Free to Choose (highly recommended) devote a chapter to labor unions. It's chapter 8 and it's called, Who Protects the Worker? The main idea of the chapter is that labor unions, rather than protect all workers, actually shut out some workers in order to keep wages high for those workers who are fortunate enough to be let into the union. They give some compelling examples. One involves the American Medical Association.

In his book, Life on the Mississippi, Mark Twain gives an example of how labor unions work to reduce the supply of workers. It's in chapter fifteen, The Pilot's Monopoly. As Twain tells it, with the increase in the number of steam boats on the Mississippi, the need for pilots increased. However, so many pilots were being trained that there was a glut on the market, and pilots' wages actually dropped. The solution, thought of by some of the top river boat pilots, was to create The Pilot's Benevolent Association. What starts out as a way to keep new pilots off the river, ends up forcing older, experienced pilots to submit to the rules of the association. As my simple explanation is inferior to Twain's you should read the entire escapade here. Then if you have the desire, read what the Friedmans have to say about unions. Twain's experience could have been used by the Friedmans.

Labels: labor unions, Life on the Mississippi, Mark Twain, Milton Friedman

posted by Harry @ 7:27 PM