Boeing and the Policy of Strike Avoidance

The brat always wonders why nobody wants to play with him…and will sometimes plot to ensure that, if they can’t play, nobody else gets to play either.

That’s the impression that sticks in my mind after reading about the latest spat between Boeing and its unions.  http://www.msnbc.msn.com/id/43243531/ns/business-us_business/  It seems that Boeing is opening up a new, permanent plant for its 787 at a non-union shop in South Carolina.  The unions back in Washington (state and DC) are unhappy about this, naturally; but since Boeing essentially admitted that the reason they want to open in South Carolina is to avoid the unions’ tendency to strike, the National Labor Relations Board (NLRB) feels it can build a case against them for strike-busting. 

Keep in mind that no union jobs are being lost or replaced here.  This is a new plant that will be the permanent assembly line for the new 787 aircraft.  The current one in Washington state is, it seems, only temporary–presumably the assembly line will start assembling something else, once they catch up with some of their order backlog.   The NLRB wants to reverse this:  to make the one in Washington the permanent plant and the one in South Carolina to be the temporary assembly line.

The main question here is, why should the NLRB get to determine where Boeing builds its plants?  If Boeing determines that Washington with its union shop is too expensive for them, why shouldn’t they look for somewhere cheaper?  If my apartment complex kept raising the rent, I’d probably look for somewhere cheaper, too.  Striking may be a “legally protected activity” (to quote the NLRB spokesperson)–but as there’s no strike going on at the moment, it’s hard for me to take the NLRB charge seriously.  There is no law specifically against a company moving to a non-union state.   And if there were, what do you think companies would do if they wanted to stay in business?  Right first time:  They’d move overseas.

It’s the typical bluster of the spoiled child who makes demand after demand after demand of his playmates and then wonders why everyone leaves.

I won’t go so far as to say there’s no place for unions.  There are times when they can be constructive and even necessary.  The current arrangement, though, perhaps gives the unions too much power, creating an inflexible labor market ill-suited to meet the caprices of changing business circumstances.  In fact the union system strongly resembles a monopoly.  If one wishes to do certain work for Company X, one must be a member of Union Y; likewise if Company X needs certain work done, they must go through Union Y to obtain it.

Perhaps what’s needed is a different union paradigm.  If the unions want to act as a sort of general contractor for the labor market, that’s fine:  but there should be some level of competition.  It’s possible to imagine a system in which smaller unions compete with each other for specific workloads.  Unions that provided inadequate representation or make too many demands would find themselves with no members or no work.  Those that struck an appropriate balance could thrive.  And with shorter-term contracts, businesses could more easily change their staffing to meet their production needs.

What’s not so easy to imagine is how to get there.  Unions, of course, like their monopoly and aren’t afraid of using what power they have in Congress to preserve it.   So it looks like, for now at least, we’re stuck with the status quo.

Of course, as more and more manufacturing jobs move overseas, the power of the unions will inevitably diminish; and if the NLRB wishes to accelerate that trend, then by all means they should continue on with their little spat against Boeing.

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