Advancing a Free Society

Boeing and Verizon Capture Strategic Hill in Labor Wars

Tuesday, August 23, 2011

Normally most news about labor developments reflect the unwise labor policies pursued at every level of the Obama administration from the President down through the National Labor Relations Board.  It is good therefore to report that there has been some pushback on these issues which might indicate that the President might run into some serious headwinds on this issue.

The two concrete events are these.  First, yesterday, the Communications Workers of America decided to call off the strike and return to work, without a new contract.  The loss of leverage is of course the shattering defeat that I had predicted on this issue, when I wrote that in this instance Collective Bargaining = Collective Suicide.  The CWA is to be commended for coming to this realization sooner rather than later.  But the long term prospects have not changed.  The decline in landline services will lead to an inexorable decline of the number of union workers that will have jobs in the sector.  The more accommodating the CWA, the longer it will keep its members working.  The hawk strategy cannot work when everyone knows that the economics are squarely against you.

The second matter is the festering dispute over whether Boeing can open its new facilities for its Dreamliner to North Charleston.  Once again, I have made my views clear: this whole episode isSenseless in Seattle.  It represents a grievously misguided effort by Lafe Solomon, the acting general counsel of the National Labor Relations Board, in an act of political suicide—strange how that word comes up in both cases!—that should be immediately dropped.  It is nice therefore to report thatJoe Nocera writing in the New York Times takes the same position.  The tedious labor claim that one just opens up a new $750 million facility in North Charleston as retaliation against workers whose rights under existing contracts are fully respected is one of the most grotesque that I have ever heard.  It is indeed “unprecedented” in labor law annals, and represents the most dangerous threat to the ability of business to locate its facilities where it deems it best.  Nocera, who is no friend of business, described the argument as “a mind-boggling stretch.”  And he was right to call out the President for staying above this fray when he had appointed Solomon to this position. 

The President is giving a labor day speech in front of a union audience.  Lots of other people not on the invitation list will be listening to what he has to say. 

(This post originally appeared on