Mickey Kaus breaks it down:
When Kuttner says “Japanese total labor costs are comparable, even with Detroit’s higher health insurance costs,” he is–as is so often the case–talking through his hat. Look at this chart. GM pays $31.35 an hour. Toyota pays $27 an hour. Not such a big difference. But–thanks in part to union work rules that prevent the thousands of little changes that boost productivity–it takes GM, on average, 34.3 hours to build a car, while it takes Toyota only 27.9 hours. ** Multiply those two numbers together and it comes out that GM spends 43% more on labor per car. And that’s before health care costs (where GM has a $1,300/vehicle disadvantage.
Of course, nothing convinces like an apples-to-apples comparison. And on that front, we find:
Is it really an accident that all the UAW-organized auto companies are in deep trouble while all the non-union Japanese “transplants” building cars in America are doing fine? Detroit’s designs are inferior for a reason, even when they’re well built. And that reason probably as more to do with the impediments to productivity imposed by the UAW–or, rather, by legalistic, Wagner-Act unionism–than with slick and unhip Detroit corporate “culture.”
In theory, I got no problem with unions – they could be nothing more than a free association engaged in bargaining with willing buyer for their services. The problem is, there are no unions that represent this ideal. Unions in the US are an artificial creation of the state, a relic of an earlier day when socialism was The Answer to society’s problems, and unions were seen and used as a vehicle for rolling back, reforming, and ultimately displacing free market capitalism.
It is no accident that, in the US at least, unions have been steadily losing ground for decades in industries that actually have to compete to survive. The only areas where unions are strong at all is in the government sector and, sadly, in the quasi-government sectors (such as healthcare).
While there is zero chance of any reform of the state apparatus supporting unions (which is probably a shame; there may well be a legitimate and beneficial role for non-corrupt, non-state-supported unions in some sectors, but we will never know), but I for one am glad to know that they are in broad decline, and that globalized markets mean there is little to no chance they will ever stage a resurgence in their current form. The fate of unions seem to be a rare example of civil society grinding down the state.