"There has to be a mutually beneficial relationship between corporate management and labor. Let management exploit and abuse labor and they'll screw you by doing a poor job, dragging @ss, getting "injured".. etc. And when management demands concessions from labor, they'd better be willing to match them on a percentage basis."
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It may take 2 or 3 bargaining cycles to get things where they should be: where new economic realities are reflected in union contracts. There are ways to accelerate the process: start making short-term contracts, adopting an "incremental approach", and so on. The techniques are well-known among the best practitioners of labor negotiation - but many refused to employ Best Practices in negotiating with unions. They thought it was easy, too unimportant for serious attention.
Yes, there will probably be strikes. Yes, there will be unions, municipalities and states who make unreasonable demands. Yes, there will be frustration and aggravation not only on the union front, but right across the spectrum of business, government and general economics: because big changes are upon us. And yes, some unions will go too far, ask too much, and be authors of their own destruction.
There's no question that many public-sector (and private-sector) unions have negotiated themselves into contacts that are FAR too advantageous. In that respect, Mish is absolutely right to expect change.
But these were negotiated contracts. They weren't Wall Street thefts, they weren't hidden breaches of corporate duty: they were agreements, openly bargained for (with plenty of media attention) and signed off by municipalities, states, and companies such as GM, Chrysler, Ford, Boeing and many others.
Getting union agreements into alignment with new economic realities will simply be part of a greater adjustment right across the US economy. That includes management, non-union workers, bankers, Wall Street - everybody.
There's no reason to make unions the whipping boys for the state of the US economy. The blame for that rests mostly with elites in finance, corporations and government. Sudden losses and burdens in the trillions cannot be blamed on people at the assembly line.
Unions must be negotiated with. That's the law. But over time, they will respond to the realities - and without the sleight-of-hand that has characterized Wall Street and corporate governance in past years. Everything will be done in full view of the public.
Unions won't inflict any hidden pork, S&Ls, Enrons, LTCMs, Worldcoms or AIGs on the US.
That will be left to the real thieves in the system.
Jim |
