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  1. #1
    filling some space UnitOfPopulation's Avatar
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    Default Monopolistic labor unions - something ought to be illegitimized with antitrust laws?

    I just noticed a particularly great inefficiency in our Finnish economic system, something that USA has done well to avoid. Usually we associate monopolies with corporations that have the market penetration approaching the level of 100%.

    We've accepted that it requires the society to set laws to govern their business models, as such situations are considered bad for competition and efficiency of the marketplace. Other countries, as well as the EU, seeks to split (near)monopolies into smaller entities in order to increase competition.

    Now, how can we have monopolistic labor unions in a country as competetive as Finland? The work force of entire industries are represented by single labor unions, often leading to a kind of unhealthy use of absolute negotiating power.

    Labor unions have little formal power over their members, so they can't be strictly consider as "producers" of the labor force. Nevertheless, they collectively, de-facto have the monopolistic power over the work force, given by the will of the workers. Often times, almost (if not entirely) all workers in a critical position in a company are members of one and the same labor union, that is bound by the law to advocate the interest of it's members.

    If it's little what they can produce, it's much that they may withold.

    It has become commonplace to exercise that monopolistic power in today's economic situation. As a counterforce, Finnish businesses are often forced to lay off their entire staffs in a cases when productivity and profits lag behind of what's needed to sustain the jobs, because so little adjustment can be done with the existing collective bargaining agreements at any one time. Business is moved to another branch of a corporation, another location - something that is entirely reasonable, but something that wouldn't have to be done as often, if the labor unions would have reasonable bargaining power, as opposed to unreasonable.

    Given the legislation, rationality and self-interests, this new equilibrium represents a new optimum, given the laws and the practicalities of the economic climate. Yet, it is sub-optimal compared to a situation where the companies could demand their work force to be represented by multiple independent labor unions, instead of one and the same. This would bring new healthy competition between the respective unions, and would balance out the unhealthy dictatorship the critical workers have over an entire industry.

    Thoughts?
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  2. #2
    Protocol Droid Athenian200's Avatar
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    From what you've said, I'm inclined to agree for the most part. I know that in situations with no unions, corporations can exploit workers without them having any recourse except to quit, which many couldn't afford to do. With the situation you described above, the unions were all-encompassing and tried to exploit the corporations for money and resources, leaving them with no choice but to abandon the entire union to save the company.

    Do you think that as an alternative, perhaps there should be a limit placed on what unions can argue for rather than dividing them? Basically, legally restrict their potential demands based on the nature of their work and reasonable standards instead of allowing them unlimited bargaining power?

  3. #3
    filling some space UnitOfPopulation's Avatar
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    Quote Originally Posted by athenian200 View Post
    Do you think that as an alternative, perhaps there should be a limit placed on what unions can argue for rather than dividing them? Basically, legally restrict their potential demands based on the nature of their work and reasonable standards instead of allowing them unlimited bargaining power?
    I don't know of a direct method by which such a limit could be evaluated, measured and thus enforced. What kind of a limit would it be? It would be something belonging to a mixed economy, not that it's a curse word or anything.. but there's already a direct method to reach the goal, competition. It's been verified to repeatedly improve the systematic efficiency of many previously uncompetetive market areas, and thus this legislation could be effectively marketed to conservative big players who want certain improvements to their business environment. Those people, as we know, favor free market economy.

    Mind asking you, what kind of a type did I just sound like? I was writing exactly what I was thinking.
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    Protocol Droid Athenian200's Avatar
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    Quote Originally Posted by Santtu View Post
    I don't know of a direct method by which such a limit could be evaluated, measured and thus enforced. What kind of a limit would it be? It would be something belonging to a mixed economy, not that it's a curse word or anything.. but there's already a direct method to reach the goal, competition. It's been verified to repeatedly improve the systematic efficiency of many previously uncompetetive market areas.
    Okay, I can see that. I wasn't sure what would be easier given your country's infrastructure. It sounds like you were right the first time.
    Mind asking you, what kind of a type did I just sound like? I was writing exactly what I was thinking.
    Did I give you any indication that I thought you were thinking something other than you were writing?

  5. #5
    filling some space UnitOfPopulation's Avatar
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    Quote Originally Posted by athenian200 View Post
    Did I give you any indication that I thought you were thinking something other than you were writing?
    No! I was just noticing that I was unusually decisive and matter-of-fact in this matter, as opposed to many other issues - or so I think I am just interested of if you would describe it as characteristic behavior of another time, because I'm interested of the method by which the people make their type diagnosis, and I know you to be well-informed and insightful

    I didn't consider myself personally, but just considering the idea of type-first-impressions from a short piece of text. Just text, not me!

    But oh, can a piece of text be typed?
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  6. #6
    filling some space UnitOfPopulation's Avatar
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    Quote Originally Posted by athenian200 View Post
    Okay, I can see that. I wasn't sure what would be easier given your country's infrastructure. It sounds like you were right the first time.
    Not necessarily, I just thought based on my lack of knowledge in that area

    What kind of limitations would you place on the contracts the unions could make?
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  7. #7
    Protocol Droid Athenian200's Avatar
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    Quote Originally Posted by Santtu View Post
    No! I was just noticing that I was unusually decisive and matter-of-fact in this matter, as opposed to many other issues - or so I think I am just interested of if you would describe it as characteristic behavior of another time, because I'm interested of the method by which the people make their type diagnosis, and I know you to be well-informed and insightful

    I didn't consider myself personally, but just considering the idea of type-first-impressions from a short piece of text. Just text, not me!

    But oh, can a piece of text be typed?
    You were serious about that question? Well, from that first post, I would have gotten ExTx, but no further. I might have gotten a hint of N since you seemed interested in it as an idea rather than a concrete situation, but you could also have been a studied S. J and P aren't really obvious here either. You seem open to interpretations as well as presenting your ideas.

    Quote Originally Posted by Santtu View Post
    What kind of limitations would you place on the contracts the unions could make?
    There are several kinds I can imagine:

    1. Bargaining quota -- The union could only be allowed to demand bargains a fixed number of times each year (perhaps 3). This doesn't seem like the most effective one, though.

    2. Bargaining standards -- A party of government-employed researchers who would be extensively scrutinized, checked and rechecked for any bias or favors beforehand would decide on a "cap" for what industry standards in pay and safety were reasonable, and prevent unions from going higher than that in their demands. The analysis would be conducted periodically and attempt to evolve with safety standards and inflation/deflation of money as well as the standards of living, etc.

    3. Appeals -- A corporation would be allowed to "appeal" a union's demands to a special kind of judge, who would decide whether the union's demands were within reason for what they were threatening to withhold or not.


    What do you think of those ideas?

  8. #8
    filling some space UnitOfPopulation's Avatar
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    Quote Originally Posted by athenian200 View Post
    1. Bargaining quota -- The union could only be allowed to demand bargains a fixed number of times each year (perhaps 3). This doesn't seem like the most effective one, though.
    Yep, they'll just demand more at any one time.
    Quote Originally Posted by athenian200 View Post
    2. Bargaining standards -- A party of government-employed researchers who would be extensively scrutinized, checked and rechecked for any bias or favors beforehand would decide on a "cap" for what industry standards in pay and safety were reasonable, and prevent unions from going higher than that in their demands. The analysis would be conducted periodically and attempt to evolve with safety standards and inflation/deflation of money as well as the standards of living, etc.
    Why not, if done on some "essential workers".. if someone can cause much more than the usual level of financial (or other) loss by striking, such sectors might be restricted in their level of pay raises on a short notice. Thus, if some group of essential workers decide to get a large raise in their salary, they must do it over a long time, so that the society has time to adapt. The companies might apply to have some jobs designated as "essential", and some common criteria would be used to evaluate whether it is so. Not everyone could be declared essential; just those that would hurt the whole company/industry/society especially bad if the service were to be terminated.

    Quote Originally Posted by athenian200 View Post
    3. Appeals -- A corporation would be allowed to "appeal" a union's demands to a special kind of judge, who would decide whether the union's demands were within reason for what they were threatening to withhold or not.


    What do you think of those ideas?
    This "reason" would have to be attached to some criteria, like the one described in #2. So, the question would become one about preventing or reversing extortion. Perhaps both are needed, prevention AND "cure" in the form of appeals.

    All of this would have to be done with minimal impact to financial freedom of the society as a whole, unless we want to lose some of the benefits, too.

    The ideas are good and worthy of being built upon.
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  9. #9
    filling some space UnitOfPopulation's Avatar
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    Quote Originally Posted by athenian200 View Post
    You were serious about that question? Well, from that first post, I would have gotten ExTx, but no further. I might have gotten a hint of N since you seemed interested in it as an idea rather than a concrete situation, but you could also have been a studied S.
    Ok, perhaps I've had a too narrow a view of S and J, thinking that the moment I'm being practical or planning something I betray my type
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  10. #10
    Senior Member wildcat's Avatar
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    Quote Originally Posted by Santtu View Post
    I just noticed a particularly great inefficiency in our Finnish economic system, something that USA has done well to avoid. Usually we associate monopolies with corporations that have the market penetration approaching the level of 100%.

    We've accepted that it requires the society to set laws to govern their business models, as such situations are considered bad for competition and efficiency of the marketplace. Other countries, as well as the EU, seeks to split (near)monopolies into smaller entities in order to increase competition.

    Now, how can we have monopolistic labor unions in a country as competetive as Finland? The work force of entire industries are represented by single labor unions, often leading to a kind of unhealthy use of absolute negotiating power.

    Labor unions have little formal power over their members, so they can't be strictly consider as "producers" of the labor force. Nevertheless, they collectively, de-facto have the monopolistic power over the work force, given by the will of the workers. Often times, almost (if not entirely) all workers in a critical position in a company are members of one and the same labor union, that is bound by the law to advocate the interest of it's members.

    If it's little what they can produce, it's much that they may withold.

    It has become commonplace to exercise that monopolistic power in today's economic situation. As a counterforce, Finnish businesses are often forced to lay off their entire staffs in a cases when productivity and profits lag behind of what's needed to sustain the jobs, because so little adjustment can be done with the existing collective bargaining agreements at any one time. Business is moved to another branch of a corporation, another location - something that is entirely reasonable, but something that wouldn't have to be done as often, if the labor unions would have reasonable bargaining power, as opposed to unreasonable.

    Given the legislation, rationality and self-interests, this new equilibrium represents a new optimum, given the laws and the practicalities of the economic climate. Yet, it is sub-optimal compared to a situation where the companies could demand their work force to be represented by multiple independent labor unions, instead of one and the same. This would bring new healthy competition between the respective unions, and would balance out the unhealthy dictatorship the critical workers have over an entire industry.

    Thoughts?
    Finland is the promised land of trusts.

    Where is the local grocer?
    Where is the local janitor?
    Where is the local legislator?
    Where is the local school?
    Where is the local energy company?

    In hell.

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