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Saturday, December 27, 2008

Hilda Solis: Bad Choice for Labor Secretary

I have mixed feelings regarding labor unions. If I had had the protection of a labor union in academia, I would still be a professor today, and I've been subjected to abusive behavior in the private sector as well. But I also have had to wait days to have my office overhead lights replaced, and once at UWM the assistant dean asked a couple of faculty members and myself as a favor to help move a few items between offices--only to find the matter written up by the local union, which had the audacity to charge the business school for our efforts (and a penalty on top).

I consider teacher unions to be a fundamental obstacle to necessary education reforms. For instance, worker protections make it virtually impossible to fire mediocre faculty, and unions resist differential pay to reflect the realities of market supply and demand (e.g., math/science teachers vs. English teachers) and merit pay. I swear to God if I hear one more demagogue talk about how poorly we pay teachers (even Phil McGraw pays lip service to this)...: According to the American Federation of Teachers, in 2004-2005, the average beginning degreed teacher made just shy of $48K, which is not bad for a 9-month job. On the other hand, according to the PayScale Research Center, the average assistant professor with 5-9 years of experience makes $52K. (These vary by state and also by academic area; for instance, business school professors typically are paid more.) I am not arguing the merits of a good teacher making a decent salary, but I can tell you I have dealt with a number of college students over the years whom have poor preparation, written communication skills, work and study habits, and unrealistic expectations based on inflated grades.

Unions also bear some responsibility for the current auto bailout crisis. The automakers tended towards higher-margin vehicles, like trucks, SUV's and utility vehicles, in part to cover an increasing labor burden, in particular retiree health and pension costs. But the response to a global competition for oil exports has been to resort to gimmicks like subsidizing the initial purchases of gasoline, not unlike a drug dealer's trial period to hook a new user. Now, of course, a sharp drop in consumer spending has even better-managed international competitors, like Toyota, reeling. Nevertheless, the crisis that has brought Detroit to its knees is not the global recession; it's the fact that Detroit has been ceding market share to foreign competitors, including those with U.S. plants, and American vehicles are the exception, not the rule, on recommended lists, such as those from Consumer Reports. If the unions don't scale back, particularly on those extra labor costs that put Detroit in the hole about $1500 per vehicle, they will oversee the demise of the domestic auto industry--and its labor union membership. Asking the American taxpayers, many of whom do not have comparable pay and benefit packages, to provide a short-term fix to an unsustainable business model, is unreasonable. 

Congresswoman Hilda Solis basically rubberstamps the counterproductive agenda of Big Labor, including trade protectionism (or "how can we hold back the number of American jobs servicing the exports of domestic goods and services?"), increasing the minimum wage (or "how can we shrink the number of opportunities available to lower-skilled workers?"), or the oxymoronic "Employee Free Choice Act" (or "how can we intimidate company workers into voting in a union because we can't trust them to decide what's in their own best interests with a secret ballot?")

Barack Obama accused John McCain during the general election campaign of being unduly influenced by lobbyists, which he himself termed "special interests" (despite no evidence of lobbyist impact on McCain's votes over a 26-year legislative career). However, by selecting a partisan totally in the tank for Big Labor, Barack Obama has exposed the seductive fallacy and thin veneer of his nonpartisan rhetoric. Obama should reconsider his selection; if not, the U.S. Senate should vote down Ms. Solis and hold out for a nominee with a more balanced perspective.