Freedom, Prosperity and Right to Work
The Right to Work clause came into existence in 1935, embedded in the Taft-Hartely Law. It means that (A) employees may not be forced to join a union, that (B) employers need not hire only those who agree to join a union, and (C) employers need not fire employees for failing to join a union or pay union dues.
For over half a century the clause was ignored. Union bosses and their political allies forced employers to fire those who did not join a union or pay dues to a union, and forced employees to join a union as a condition of employment and to pay union dues.
With millions of employees federally forced to join unions and pay dues, unions had massive funds, which would vanish if the Right to Work clause were implemented. So, union bosses lobbied ferociously, bribing and threatening politicians to repeal the Right to Work clause.
But for the same number of years, consistently favoring the Right to Work, the electorate voted out of office those politicians that supported its repeal.
After years of struggle, Idaho—apparently the first state to take action—put the RTW clause on the ballot in 1986. The electorate voted for it overwhelmingly.
What benefits, if any, accrued to them?
An easily understandable article on the RTW is that of the National Institute for Labor Relations Research, entitled “Real Earnings Higher in Right to Work States”— http://nilrr.org/2001/01/01/real-earnings-higher-right-work-states
Its author, Stan Greer, refers to the study made by F. Howard Nelson, “a veteran researcher for the 1.3 million-member American Federation of Teachers (AFT) union.”
The Nelson Index looks at a variety of economic factors measuring them from different perspectives. For instance, an average worker in non-Right to Work California would have to earn almost $65,000 per annum in order to enjoy the same pre-tax earning power of a worker in Right to Work Florida earning only $50,00 a year. Additionally, the Californian would have to pay a significantly greater portion of his nominally higher income in federal income taxes. The result is the California worker’s after-tax standard of living is actually lower than the Floridian’s. [Emphasis mine here, and throughout.]
The reason why the Right to Work Floridian is better off than the union-controlled Californian is not, however, the exclusive result of differences in taxes. Certainly, the lower tax rate makes a difference. But more important is the option not to join a union and pay union dues. The dues he does not have to pay is money he now has to use, save or invest as he chooses.
How much better off is the Floridian? “After subtracting state income taxes and all federal taxes, the 2000 cost-of-living-adjusted mean weekly earnings of employees in Right to Work states was $484, compared to just $468 in non-Right to Work states.”
Whether the employees’ money is saved or invested, the bank or the security receiving it is enabled to grant a loan to bankroll someone’s house—movers, new furniture, landscaping–or a start-up, or a business expansion. All that means more work farmed out, more jobs opened up, more values offered.
In short, money forced into union dues is a dead end. The union dues an employee is not forced to pay is money he can invest in his own personal happiness. The result is an expanding economy, a rising standard of living.
Mr. Greer writes that the Nelson Index*—which rests on 2000 figures, the most recent then available—”shows that living expenses for employees in non-Right to Work states are overall 4.4% higher than the national average. Overall living costs in Right to Work states are 7.1% more affordable than the national average.” In this way, “the real earnings of employees in Right to Work states are shown to be higher.”
The index ranks New Mexico—a non-Right to Work state—below the national average. Were New Mexico to enact Right to Work, business growth and increased personal incomes would result in a more prosperous state. A paper published by the Rio Grande Foundation, for example, estimates that the income thus generated would amount to about $21 billion by the year 2020.
But why? Why does prohibiting the use of force have such a beneficial effect on economic growth and prosperity?
The National Institute of Labor Relations Research answers the question. Mr. Greer begins his article by correctly identifying the foundation of the Right to Work clause: “Big Labor propaganda against Right to Work legislation and laws rarely focuses on the principle at stake: freedom of association.”
Later he states: “. . . Right to Work laws are not merely or even primarily an economic development tool. Right to Work laws and legislation are really a matter of freedom, not economics.”
True. But go deeper still. Individual rights are the foundation of freedom. “Freedom is the absence of force.” Without individual rights, freedom does not exist. To the extent one’s rights are violated, to that extent is one’s freedom is curtailed, ultimately to be destroyed altogether.
By definition individual rights include the assurance that no man may violate the rights of another with impunity. A culture permeated by freedom is a culture enjoying the essential condition for prosperity.
Philosophically, the Right to Work clause is the recognition of man’s right to think for himself, to make his own choices and decisions—i.e., his right to life.
Psychologically, assurance of individual rights manifests itself in an increase in self-esteem, self-confidence, willingness and eagerness to bring to fruition one’s goals and values. The result is the exceedingly powerful incentive to action: personal happiness. Personal happiness fuels productivity.
Surely, everyone wants to be happy and most men want others to be happy. So one might wonder why union bosses continue to block implementation of the RTW clause.
Here are two excerpts from Mr. Greer’s article that explains it:
“Where forced dues are legal, union officials use their power to dislocate labor markets, jack up costs, and bankroll Tax-and-Spend, regulation-happy state legislators and governors.”
“In many cases, forced-dues treasury money goes to support not only bargaining positions, but also political candidates and causes that many or most forced dues-paying workers oppose.”
New Mexicans and the state government would gain from making New Mexico a Right to Work state. If prosperity is what we want, a pro-business climate and its corollary, the Right to Work should be implemented here without delay.
© All rights reserved. Sylvia Bokor, August 7, 2012.
Please contact PA Right to Work headquarters with questions or for additional information.
(717) 422-5079 or info@PARightToWork.org