In the wake of Governor Scott Walker's survival of a recall vote, initiated by friends of Wisconsin's public service unions, let's explore again just why such unions are perverse. Bona fide labor unions work within a free-market system where firms compete for customers who are normally able to switch from sellers of wares and services if they want to. Public works are noncompetitive, however. Workers who belong to public unions conduct their labor negotiations without their employers facing any competitors. The USPS, for example, has a monopoly over first class mail delivery; teachers at public schools are working for monopolistic employers – students must attend school and the funds are confiscated through taxation and not obtained through voluntary exchange. So as the saying goes, public workers have the taxpayers over a barrel – there are no alternatives and in most cases one cannot refuse to deal with these workers.
So public workers unions are not genuine free-market agents. As such they are able to have their terms met by the taxpaying public basically at the point of a gun. The public must deal with these workers; otherwise they face legal sanctions. There is nowhere else to go apart from moving out of the state to another where the same situation obtains, where once again public unions possess monopoly powers and customers have nowhere else they can turn to get a different deal or to avoid dealing altogether.
In a genuine free marketplace unionization would involve organizing workers in a firm that competes with others for customers and with which customers are free not to enter into trade. So the unions would not be able to engage in extortionist practices, making demands that must by law be met. If one's child attends a public – or, as some prefer calling them, government – school and teachers decide they want a higher salary or other benefits, the option of leaving the school doesn't exist because one will be taxed to pay for it anyway. The same basic setup exists when it comes to any public work and unions so for these folks to unionize is quite unjust.
Indeed, the rationale behind public works is not the same as behind private works. In the latter all the parties are involved so as to get the best deal they can find and bargaining occurs to bring this about. Public works, however, are supposed to amount to public service, something done not for profit but as a commitment to the public good or interest. Anyone who views public work as if it were the same as private work is either suffering from a misconception or perpetrating a hoax.
Accordingly, all the people who work for governments, which are all supported through confiscatory payments – that is, taxation – are, strictly speaking, ineligible for unionization.
Public work, in contrast to private business, is something legally required and paid for involuntarily. So unlike going to the grocery store, of which there can be several in one's neighborhood and which one can actually avoid if one decides to do with little food and household supplies, in the case of public services citizens are not free to deal with others or walk away from the providers.
Clearly, then, the original idea of labor organization into unions does not fit the public service situation. Unfortunately, this is rarely kept in mind. Thus, when in Wisconsin or anywhere else for that matter public service employees are insisting on retaining the benefits they have obtained through bargaining with the government they were getting a very special deal. Public policy imposed their services on the citizenry and now the citizenry is no longer able to come up with the loot previously extracted from them via what comes to extortionist means. Yet, because much of the population – egged on by people who would very likely just as soon impose public services on everyone in every line of work (just check out Paul Krugman's column in The New York Times on Monday, 2/21/11) – has sympathy for the usual laborer or worker when these are often dealing with powerful firms in a free market, the unions are getting a free pass in their current conflict with their employers.
This situation needs to be seriously reexamined. It may indeed imply that the entire idea of public service, let alone public service unionization, is misguided.