When workers are forced to join a union in order to work, it hurts workers pretty much the same way as business monopolies hurt consumers, according to a report released Monday by conservative think tank The Heritage Foundation.
According to the report, in those states where union membership is required in order to have a job, unions will have higher dues and be far less efficient than in states that don’t require union membership as a condition of employment. The report argues that these negative outcomes are likely caused by unions not having to worry about proving their worth in order to keep their members.
“Businesses with monopolies charge higher prices and operate less efficiently than they would facing competition,” the report argues. “Labor unions operate no differently.”
In business, a monopoly occurs when there is only one supplier of a particular commodity. When this happens, the one company can control prices while also delivering a subpar product because the consumer doesn’t have the choice to go elsewhere. Recognizing the potential harm this may have on consumers, lawmakers have passed several laws to prevent monopolies over the years. And as the report argues, laws in compulsory-union-membership states legally cause union monopolies that are prone to the same negative behaviors business monopolies are.
“Union financial reports reveal that they charge workers roughly 10 percent higher dues and pay their full-time top officers $20,000 more annually in states with compulsory dues,” the report found.
James Sherk, the Heritage scholar who wrote the report, told reporters at a policy forum that the findings aren’t at all surprising, though the subject hasn’t yet been thoroughly studied before then.
“No one’s taken a look at this yet, and I realized the reason no one has taken a look at this yet is it’s only recently the data has become available,” Sherk noted. “In the 2000s, Elaine Chao when she was labor secretary modernized the union financial reporting information. She required the unions to itemize all their expenditures over $5,000 and she basically made all these reports available online.”
“We summarize in the report, it’s roughly 10 percent… higher dues that the unions charge when they can force you to pay dues,” Sherk continued. “When the unions can force you to pay dues they maximize their revenue.”
Sherk argues that the higher dues go to pay the union officers, instead of benefiting union members.
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