Big Labor Lackey

It’s sad that the president of the United States could be considered anyone’s lackey but in the case of President Obama and Big Labor the shoe fits snuggly.

Matthew Continetti in the Los Angeles Times opines:  

The president has put on his Santa Claus cap and lavished unions with gift after gift. Days after taking office, he issued three executive orders reversing Bush-era labor policies. In February, he approved a stimulus bill that contained “buy American” provisions. In a move that would have made Jimmy Hoffa proud, the $400-billion omnibus spending bill that Obama signed into law in March eliminated funding for pilot programs allowing Mexican trucks in the United States as mandated by the North American Free Trade Agreement.

In June, the president oversaw a restructuring of General Motors that left the UAW owning 17.5% of the company. The union is GM’s second-largest shareholder (the largest is Uncle Sam). Early in September, in a speech to the AFL-CIO convention in Pittsburgh, Obama said he was “standing behind” the Employee Free Choice Act, which would make it easier for workers to organize by seriously diminishing the secret ballot in union elections. And on Sept. 11, the president imposed a 35% tariff on Chinese tire imports, a policy straight from the wish list of the United Steelworkers.

Now, a cynic might say that Obama feeds labor a steady diet of goodies in order to secure its backing for healthcare reform, or maybe to reward it for its efforts in the 2008 election. But it’s just as likely that Obama thinks higher unionization will lead to middle-class stability.

The problem with this argument is that despite the recession, the middle class has done pretty well during the period of low unionization. Don’t take my word for it. When Obama’s budget director, Peter Orszag, ran the Congressional Budget Office, he released studies that showed the average income of the poorest families grew by 35% between 1991 and 2005, and there was no substantial income volatility recorded between 1980 and 2003.

The costs of a heavily unionized workforce outweigh the benefits. Organized labor often politicizes the workforce and hinders economic efficiency. Once a workplace is unionized, it’s more difficult to fire unproductive workers, and thus a lot harder to hire good ones too. In their new book, “Rich States, Poor States,” Arthur Laffer, Stephen Moore and Jonathan Williams rank all 50 states based on economic performance over the last decade. Seven out of the 10 best performing are right-to-work states. Eight of the 10 worst performing are not.