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Wisconsin Law Would Tilt Playing Field Even More Against Workers

My colleague Jared Bernstein recently addressed some of the canards around Wisconsin’s proposed “Right to Work” (RTW) law, which would dilute unions’ bargaining strength by making it harder for them to collect dues from the workers they represent.  The bill, which would make Wisconsin the 25th state with such a law, is part of an ongoing movement to weaken protections for workers attempting to bargain collectively — a movement that’s exacerbating the trend toward growing income inequality and wage stagnation.

As Bernstein explains:

Here’s what the legislation does:  It makes it illegal for unions to negotiate contracts wherein everyone covered by that contract has to contribute to its negotiation and enforcement. . . .

Let’s also be clear about what goes on in non-RTW states, as anti-union forces consistently distort the current reality.  In non-RTW states, no one has to join a union.  There have been no “closed shops” in America for more than 20 years.  When RTW advocates say they’re fighting against “forced unionism,” they are making stuff up.  There’s no such thing.

​By weakening unions, RTW weakens wages, Bernstein explains, citing a study that found “a significant wage advantage in non-RTW states of about 3 percent, which, for full-time workers, amounts to $1,500 per year.”  Weaker wages, in turn, place upward pressure on income inequality.

The long-term growth in income inequality is well documented.  It has many causes, including the growth in investment income (which goes mainly to those at the top of the income scale) as a share of the economic pie.  At the same time, wages have grown more unequal due to longer periods of high unemployment (which reduce workers’ negotiating power), more foreign competition, and a decline in higher-paying manufacturing jobs.  Earnings for low- and middle-income workers have frequently fallen or remained stagnant.  A range of studies (see here and here for examples) have concluded that falling union membership has played a significant role in these unfortunate trends.

Federal and state policymakers can push back against these trends by enacting (and enforcing) stronger labor standards, reforming immigration policies to bring workers out of the shadows, promoting full employment, and, importantly, protecting workers’ rights to organize.