Monday, March 5, 2018

Strikes, Janus, & Amazon

The West Virginia teachers' strike headlines the news at both The Militant and Socialist Action. The latter's star reporter, Bill Onasch, probably gives the best overview of the situation. The lede paragraph:
West Virginia “Wildcats”—Technically, public sector collective bargaining is illegal in West Virginia. But practically, governors have negotiated in the past with teachers—and school service employees including bus drivers, cafeteria, clerical, and maintenance workers—for salary and benefit packages passed by the legislature. While perhaps better than nothing, the teachers have been falling behind.
He tells us that 20,000 teachers and 15,000 support personnel are off the job, that they haven't gotten a raise in four years, and that West Virginia teachers' salaries rank 48th in the nation. Further, rising health care premiums are a big issue, and that initially caused the rank & file to turn down a 5% raise from the state.

The Militant's Mary Imo-Stike (never heard of her before--may be a pseudonym) reports from Charleston, interviewing actual teachers. She captures the anger and frustration that many of them feel--medical premiums have been rising faster than wages.

As of yesterday afternoon there has been no settlement--the strike now enters its second week. The governor has conceded on the 5% raise but Republicans in the legislature balk, offering only 4%. I have no recent information on the medical issue.

A few thoughts:

  • The union's lack of legal status is important. It can't enforce a closed shop, nor can it negotiate a real contract. All it can do is get a widely publicized agreement from the state. That is actually an appropriate role for a union. I support this kind of "union" activity.
  • Labor militancy goes up as the economy gets better. With today's low unemployment the teachers are in a very strong position to ask for a raise. Looks like they're gonna get it, too. Bully for them.
  • West Virginia seems to be unusual in that teachers' salaries are negotiated state-wide, and not district by district. That gives the union more power.
  • Pensions are apparently not on the table. That undoubtedly stems from this being a "voluntary" union. "Real" unions have been lying to their members for decades, promising pensions that can never be delivered. That's been especially true with the United Mine Workers in West Virginia, as discussed here previously. Once burned--twice learned. The teachers are not negotiating for pie in the sky.
So if the only difference between the state's offer and the union demand is 4% vs. 5%, then this really should be pretty easy to settle. (Again, I don't know what's happened to the medical issue.) The governor is asking the state senate to do just that.

I don't think the roadblock is money. Instead, I'll suggest that there's a large constituency that wants the strike to last for a long time. I'm thinking of people like me--retired and no longer having kids in the school system--who resent paying taxes for "overpaid" school teachers. I think that sentiment must be strong in West Virginia, which is among the oldest states in the union, and where private-sector salaries are lower than what teachers already get. Beyond which, education is historically a low priority for the Scots-Irish who live in Appalachia. If the teachers want to go on a two-month, unpaid holiday, it's fine by them. The longer the better.

The other big labor news is the case now before the Supreme Court: Janus vs AFSCME. An Illinois public employee, Mark Janus, sued AFSCME for using his agency fees for political purposes, expounding positions with which Mr. Janus disagreed. A similar case reached the high court previously, but shortly after Justice Scalia's death the court couldn't produce a decisive majority. So they're revisiting the issue.

Oddly, neither The Militant nor Socialist Action has covered this issue at all. But Louis Proyect has.

In as post entitled Mark Janus vs. AFSCME and the need for a real trade union movement, Mr. Proyect suggests that unions that don't have a guaranteed income source are more likely to be radical. Guaranteed incomes make for complacency, and why upset the apple cart with a strike or something? Mr. Proyect quotes Illinois' solicitor general, who argues for the maintenance of agency fees.
“When unions are deprived of agency fees, they tend to become more militant, more confrontational. They go out in search of short-term gains that they can bring back to their members and say, ‘Stick with us.’”
 An interesting idea--not sure if it's true. On the one hand, the West Virginia strike lends credence--the "non-union" has no guaranteed income whatsoever and they're perfectly happy to lead a strike. On the other hand, the Wisconsin Education Association Council--once flush with cash--has, thanks to Scott Walker, been cut off. They're a mere shadow of their former selves--hardly in a position to be more radical.

Those are two anecdotes--the truth of Mr. Proyect's suggestion is an empirical question. I think the jury is out.

For what it's worth, highly regarded, conservative legal scholar Eugene Volokh has filed a friend of the court brief siding with AFSCME. The money quote:
I don't think there's any First Amendment problem with compelled payments of union agency fees at all. The government can constitutionally require people to pay money to the government (in taxes), money that the government can then use for ideological purposes (e.g., supporting a war, opposing racism, promoting environmentalism, and so on). Likewise, the government can constitutionally require people to pay money to unions, money that the unions can then use for ideological purposes.
 We'll see what the Supreme Court decides; I have no clue.

Finally, let me take issue with an article by The Militant's Brian Williams, Trotskyism's only competent economics reporter. But he falls down on the job in this piece about Walmart and Amazon. The lede paragraph:
Walmart and Amazon bosses have been battling for domination in market share and profits. The Walton family owners of Walmart have been winning, as Amazon has proven unable to launch any serious challenge to their utter domination of the brick-and-mortar store market.
But I think he's too much in love with his thesis and fails to report some significant facts. First, Amazon is not really in direct competition with Walmart. Walmart's customer is in the bottom 50% of the income demographic, while Amazon's customer is in the top 50%. Yeah, there's more overlap than that suggests, but there is definitely room in the market for both companies. Neither is going out of business anytime soon.

Second, he fails to note that Walmart has been trying to step up its on-line game, having purchased However in the recent quarter it has performed well below expectations, and the stock dropped substantially.

Third, it's a stretch to say that Amazon failed in launching brick-and-mortar stores. They only recently bought Whole Foods (which, by the way, doesn't compete against Walmart at all), and have not yet had time to assimilate the experience. They haven't failed--they're still experimenting.

The Amazon Go store--one without cashiers which is in beta-testing in Seattle--is a big experiment, as Mr. Williams notes. It potentially puts millions of cashiers out of a job. That's bad, but it's good for consumers who will save both time and money. Trotskyists, including Mr. Williams, are Luddites. Does Mr. Williams think we should ban cars so that unemployed blacksmiths can be put back to work?

So it is not clear that there is a battle royale to the death between these two companies, nor is it true that Walmart is winning.

Further Reading:

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