Michigan Unions — Strong or Bloated?

(Note: This commentary originally appeared in the Oakland Press on July 8, 2007.)

Not long ago a sandwich chain introduced us to a young man who had lost several hundred pounds on a diet that consisted mostly of subs. The before-and-after pictures — grossly overweight versus thinner and healthier — are an image that Michigan residents should keep in mind as they consider the possibility that the state might enact a right-to-work law. Union opponents of the idea that individual workers should not be forced to pay union dues will argue that a right-to-work law will weaken them and their ability to represent workers. While it’s true that ending compulsory unionism would limit the money available to union officials, as the sandwich spokesman illustrated, limits are useful sometimes and leaner can be stronger.

There’s no question that unions in Michigan are big and well-established. While the labor movement has been steadily losing members, unions still represent 20.4 percent of the workforce in the state, compared to 13.1 percent nationwide. The UAW has an almost mythic status as the force behind the Flint Sit-Down Strike and as the protector of the state’s auto workers, still some of the best-paid industrial laborers in the world. And thanks to membership dues imposed on workers in union contracts, unions in Michigan collect hundreds of millions of dollars annually with few limitations on how that money may be spent.

But is that size healthy for workers and the state as a whole? Are Michigan unions strong or merely bloated? Consider the most recent reports on negotiations between the UAW and auto-parts supplier Delphi. The two sides have agreed that higher-paid workers will take substantial wage cuts, from over $25 an hour to somewhere in the range of $14 to $18 an hour. The UAW was able to negotiate a sizeable cash bonus that will take a lot of the sting out of the pay cut, but the bottom line is that the UAW cannot prevent wages from going down in the auto industry.

Over the last several years Michigan residents, taught to believe that the state’s strong unions were largely responsible for their prosperity, have experienced a string of epiphanies about the actual state of our unions: the Detroit newspaper strike, the creation of lower-tier wages at Delphi (which originally applied only to new hires but now looks likely to apply to all blue-collar workers), layoffs at GM, buyouts at Ford and the inability of the UAW to prevent the sale of Chrysler to a private capital firm.

There are many things that might be behind this string of failures, but the right-to-work concept is not one of them — Michigan has not enacted it yet. Nor can union officials in Michigan make a credible plea of poverty. We estimate that state and local government employee unions alone collect $150 million in forced dues every year. Stan Greer of the National Institute for Labor Relations Research estimates that the overall dues take for Michigan unions, both private and public sector, could be as high as $750 million annually.

But if lack of funds is not the source of union weakness, what is? A clue might be found in a Zogby survey of union members sponsored by the Mackinac Center in 2004. When we asked union members where they believed the bulk of their union dues went, a plurality — but not a majority — said they went towards "helping workers get better pay, benefits, and working conditions." The rest gave more troubling answers, such as union politics and big salaries and perks for union bureaucrats, or they admitted they really didn’t know.

This is not exactly a ringing endorsement of union priorities and it points to one of two possible conclusions: Either unions are doing a mediocre job of looking out for the interests of workers or they have more money than they need to do that job. Or maybe both. Either way, a right-to-work law would be the healthiest remedy because it gives workers the ability to withhold dues from unions that fail to adequately represent them and empowers them to place limits on the availability and use of union funds.

The standard union argument about right-to-work laws could very well have it all backwards: Michigan’s unions are more bloated than strong, and right-to-work could inject the discipline needed to create a leaner union movement that better represents workers.

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Paul Kersey is senior labor policy analyst at the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich. Permission to reprint in part or in whole is hereby granted, provided that the author and the Center are properly cited.