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3 sentences no one should forget about unions

(Photo by Bill Pugliano/Getty Images)

Ex-union strategist Richard Yeselson makes a crucial point in his discussion of organized labor with the New Republic's Jonathan Cohn:

What's ironic about that is that unions are inherently conservative institutions, which historically developed parallel with the development of capitalism itself. They are as much a part of capitalism as Henry Ford or Apple. Unions use contracts — and there's nothing more intrinsic to capitalism than the right of contract — to link their members to the fortunes of the companies they contract with.

This is a point often lost in the debate about unions: they're an international phenomenon that has flourished almost everywhere that capitalism has flourished. And that's because they've played a critical role in making capitalism work for the people who make capitalism work.

Capitalism can generate more wealth and faster advances in living standards than any other economic system yet discovered. But it doesn't share that wealth and those advances naturally. Bargaining power is a crucial mediator in capitalism, and workers often end up with too little of it — and if that imbalance persists, then the entire system is imperiled, as capitalist systems can't survive without the support of the working class. Unions are one way to correct that imbalance. They've often saved capitalism from itself, and done so over the objections of the capitalists.

That's partly why you'll find unions pretty much everywhere you'll find capitalism. But right now, in the United States, unions are badly weakened:

Unions US vs OECD

(Data: OECD)

And, not at all coincidentally, the gains of capitalism are increasingly narrowly shared:

Unions inequality

(Economic Policy Institute)

That chart doesn't prove the rise in inequality is all about the decline in union density; no major scholars of inequality think that. But the rise in inequality is partly about the decline in union density — and the decline in union density is partly the result of the some of the other factors (globalization, technological change) behind the rise in inequality.

For more, read Yeselson's full interview at the New Republic. One point he makes that's worth considering: while unions have fallen further and faster in America than in other countries, the decline of union density is also an international issue (as, of course, is rising inequality). And for data viz geeks, Danielle Kurtzleben's seven charts showing the state of organized labor are worth checking out.

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