Bye Bye Labor Unions?

The great American economist John Kenneth Galbraith once remarked about what seems to be a dual motivation system used in conventional economics, one for the rich and one for the poor. The rich will not work if not sufficiently compensated, while the poor will not work if compensated too much.  This duality is echoed in the popular views of corporations and labor unions.  A successful corporation that maximizes its bottom line and shareholders' profits is regarded as a great public good and often awarded tax "incentives".  By contrast, a successful labor union that gets good salaries and benefits for its members is often regarded as public bad and needs to have its rights limited and gains reduced.  Such views are not limited to the professional-managerial class but are shared by the American population at large, including segments of the de-facto working class.

Such sentiments go back to Max Weber's analysis of pre-modern and modern rationality.  Pre-modern rationality, Weber argued, represented among others by the backward Eastern European peasantry, requires that a person works only as much as to accumulate adequate means for survival and then rest.  The modern rationality, by contrast, requires that one works to maximize return whether he/she personally needs these returns or not.  This accumulation and maximization of returns is indeed a divine mission embedded in the “spirit of capitalism.”

The Weber connection suggests that this curious double standard for management and labor is not simply hypocrisy or even brainwashing with business propaganda.  It has something to do with the Weberian notion of legitimacy, more specifically, a general belief who can make a bona fide claim to representing public interests, or for that matter, propose bona fide rational solutions.  It seems that corporate management is seen as a legitimate agent of both, while labor (organized or otherwise) lack this legitimacy - it can only represent their own "special interests" and their own point of view (rather than universally recognized rationality.)

The real question is, however, why is it the case?  If the study of the professions and the role of legitimacy in constructing professional status (see for example Andrew Abbott book, "The System of Professions" or) is any indicator, the key to legitimacy is the association with knowledge, or at least with what passes for knowledge at a given historical time.  Doctors are generally seen as legitimate medical professionals while healers are not.  It is so, because the former claim to posses what is widely recognized as objective knowledge on which their practice is based, whereas the latter do not.  The outcome of the practice does not matter that much, as both can be ineffective or only accidentally effective.  What matters is the believable claim of possessing legitimate knowledge, which is considered a "public good" in itself.  Likewise, the management practice is supposed to be based on the application of "objective knowledge" (economics, psychology, business management studies, etc.) whereas labor does not.

Of course this connection to knowledge is not self-evident.  It is carefully constructed and cultivated to the point of becoming what sociologists call "stock knowledge" i.e. a belief taken for granted without the need of any proof.  The professions, especially in the US,  carefully engaged in that construction and cultivation - the process known as "professional projects".  Such projects have been carefully described by Magali Sarfatti Larson “The Rise of Professionalism”).  Andrew Abott (“The System of Professions”) describes how many different professional groups collaborate on creating mutually supportive systems of professions that supports the professions' special claim knowledge, while my paper “The DiscreetCharm of the Nonprofit Form” focuses on professional projects in situations where the "system of professions" does not work.

In contrast to the professions, labor did not cultivate any claim to knowledge, at least in the US.  In fact, it often took the opposite path, that of anti-intellectualism and derision of formal knowledge, schooling, and its agents contemptuously dubbed "egg-heads.”   A recent example may be “blue collar” unionsjoining forces with business to launch an assault on teacher and public sector unions.

By so doing, the labor shot itself in the foot.  It undermined its own claim to legitimate representation of public interests and consequently it is seen only as a "special interest group" that needs to be held in check by those who legitimately represent "public interests."  In the era of austerity measures forced down on society by the professional-managerial class, this perception further erodes the standing of labor unions and may even lead to its final demise.