Union's also capping it at a contractual 150%.
Free-market AA could offer better incentives, but the union doesn't think that's fair.
Free-market AA could offer better incentives, but the union doesn't think that's fair.
The 150% maximum pay was also likely a negotiation point between the airline and the union when agreeing on a contract.
You seem to think that negotiations between an at will pilot and an airline are on equal ground, they are not. The pilot is very unlikely to get a better deal outside of collective bargaining. That is why people are willing to pay a due and give up some freedoms in order to use them as leverage in compensation negotiations.
The pilots would most definitely get a better deal outside of the collective bargaining. That is, all the ones that get left out because of this contract receive no benefits at all.
[1] http://www.bankableinsight.com/ways-unions-hurt-the-economy....
[2] http://www.foxnews.com/opinion/2011/03/17/unions-harmful-wor...
If uber drivers unionized and made uber pay them more, then less capital would go to uber and eventually have less workers. Ultimately the return on capital will end up being the same, because capital looks for returns and will move. So in effect, it would only increase wages of drivers as long as it can prevent other drivers from showing up.
For anyone at home that wants to listen to someone that knows more about economy than any of us:
Unions exist to collectively bargain on behalf of workers in markets in which individual workers do not have sufficient bargaining power to achieve the same results. They remain in power in those markets precisely due to their continuing ability to achieve better-than-free-market rates for their members, as evidenced by the death/diminishment of unions in many fields where they are not able to maintain above-market compensation for their members.
They remain in power in those markets due to their legally-granted right to remain in power in perpetuity without periodic recertification or reauthorization elections.
That's not an opinion; that's legal fact, just like saying that the President of the United States is in power because the law grants him that right until January 2021. Unlike government, where politicans have to run for re-election every N years, once a union forms, there is no legal obligation to hold an election to keep them in power. (The process for petitioning for a decertification election is incredibly difficult, and unions are actually granted a great deal of leeway by the law in taking action to prevent these elections from happening. Furthermore, even in cases where they do happen, and the majority votes to decertify the union, the election results may be overturned by the NLRB.)
All in all, if you want to argue the case that unions successfully bargain for better results on behalf of workers, you can't really rely on the fact that they remain in power, because that's already the default - it takes an extraordinary degree of opposition to remove them.
Americans seems to favour "free market" at almost any cost, but you mention that Unions are not free market (for labor) yet they provide better results. So why the "free market" passion?
If you think of labor as a commodity, unions are simply a monopoly of labor. Everyone wants a monopoly of what they sell, and freedom of what they buy, this is no different.
I would be very hard pressed to find a good union case that didnt provoke some sort of restriction on other workes, either by wage fixing, protectionism or supply limiting.
Why not? Google could make half the profit, pay it workers more and still make a boatload of money.
It's not like Google or Apple pay dividends.
Google is currently handing out giant sacks with dollar signs on them to machine learning people far exceeding the meager means of most other companies, and the stock price is rising.
By your logic, shouldn't they be in the crapper for over-compensating these folks compared to what the market value?
Google is paying a lot for talent because of supply and demand - competitors are also paying high rates for the same talent.
(oops, I mean to make capital investments in the company and raise wages for average employees -- since a company in possession of a good fortune must be in want of workers to give raises to!)
Why do you think that it's mathematically impossible for a company to find the money some other way? Any profitable company by definition makes more money than it spends, so it's clearly possible for such a company to pay its workers more without having to reduce costs (i.e. hire fewer workers) or go into debt.
You cant reduce a compnies profits and think that will increase employment.
+ In a free market without monopoly in its industry
Maybe, but it's an approach of looking into the abyss.
> You cant reduce a compnies profits and think that will increase employment.
Have a lot of implicit assumptions about the market that company operates in, assumptions that may or may not be true in the modern global economy.
Depends on the industry. If there's a lot of foreign competition and workers aren't mindful of the health of the industry, they can easily kill it off. That's what happened to steel production in the US.
Globalization increases equality between countries, but it also increases inequality within countries. There are places where unskilled labor pays a couple dollars a day. Doesn't matter what the safety standards are - there isn't anywhere in the US you can survive on that kind of money.
*Some of the steel production in the US. I am certainly not making the argument that the steel industry in the US is as large or vibrant as the 70s or 80s. However, USX still does have several plants open and is doing fairly well. In my slightly knowledgeable opinion, this is because there is such a high up front cost of building a plant (especially a continuous pour caster).
The industry also made a very large shift from producing new steel to recycling scrap to produce slabs. Virgin steel is much harder to work with and produce than its recycled counterpart. This lowers the barrier to entry, increasing competition.
After this shift, I don't think there is any way that the U.S would have been able to compete with Chinese steel regardless of unions. Even if you removed all of the union CBA stuff and just left U.S compensation laws and OSHA, I highly doubt the margins are there to compete in regards to recycled steel.
Doesn't work for Uber, because if half the drivers go on strike, pay will go up for the other half and more people are likely to work for Uber because the bar for entry is so low. Also no, uber would just raise prices. I'm fairly sure it was unions that made it difficult for just anyone to become a taxi driver though - protecting their own income, limiting competition etc.
For example, in argentina its impossible to hire pilots from other countries.
I am not ant-union but unless they live/work? in a "right to work" state I don't think they gave a choice but to pay dues or quit.
Of all union members in the country, only 7% actually have ever cast a vote in favor of the union that represents them.
The vast majority never have the opportunity to vote one way or the other, because once a union is formed, it is legally granted authority in perpetuity. They only lose that right if a majority for decertification or deauthorization, but for a number of legal reasons, it's almost impossible for those elections to even be held, even in cases when the majority of workers oppose union representation.
So, to answer your question, "But where does the union come from?" - most likely, from the people who happened to work there years ago, when 50% (plus one) voted in favor of it. It may or may not actually represent the wishes of the current workforce, were an election to be held today.
100% of people who accepted a job accepted the job...
'Plenty of prisons,' said the gentleman, laying down the pen again.
'And the Union workhouses.' demanded Scrooge. 'Are they still in operation?'
> The whip which brings us to Lowell is NECESSITY. We must have money; a father's debts are to be paid, an aged mother to be supported, a brother's ambition to be aided, and so the factories are supplied. Is this to act from free will? When a man is starving he is compelled to pay his neighbor, who happens to have bread, the most exorbitant price for it, and his neighbor may appease his conscience, if conscience he chance to have, by the reflection that it is altogether a voluntary bargain. Is any one such a fool as to suppose that out of six thousand factory girls of Lowell, sixty would be there if they could help it? Everybody knows that it is necessity alone, in some form or other, that takes us to Lowell and keeps us there. Is this freedom? To my mind it is slavery quite as really as any in Turkey or Carolina. It matters little as to the fact of slavery, whether the slave be compelled to his task by the whip of the overseer or the wages of the Lowell Corporation. In either case it is not free will, leading the laborer to work, but an outward necessity that puts free will out of the question.
-- Sarah Bagley, 1845
Once I walked away from a contract where they refused to remove the 1-year non-compete.
Another time I worked for a for a startup which had started out as an open source/volunteer project. After a big disagreement about the contract with the lawyer, the principal investor told me to 'sign the contract I wanted.' I refused to write my own contract and insisted the lawyer stop being insane and send me a contract without the non-compete section. She never did, but I started getting paid.
It worked out. The startup failed, I gutted the two commits that weren't mine and back-ported all the changes to the OSS version, keeping it all GPLv3.
TL;DR I accepted a job without accepting a job contract.
I think it's fair to say that very few people have the savvy to know that offer terms are negotiable, and further that very few people are employed in high-demand careers where they can negotiate their employment terms 1:1.
The companies have information asymmetry on their side, since these negotiations are performed sequentially and in private. Mathematically, the Nash Equilibrium looks very different for n sequential negotiations of "who will sign this non-compete?" vs a single all-or-nothing negotiation where the company ends up with <n|zero> employees.
A free market does exist at some companies for pilots, and they are compensated and treated far less well than their unionized counterparts.
Because of the specialized training, pilots have lots of leverage. You can't quickly and easily replace them.
It’s pretty easy to replace pilots. Entry level pilots make less than a fast food manager.
What did they do?
What I'm trying to say is, older pilots screwing over younger pilots and would-be pilots is pretty common.
The answer is to look at who controls the pilot's union: very senior pilots. The airline management is mostly interested in what percentage of its revenues are paid out to pilots; the distribution of the money among the pilots does not affect profitability. The very senior pilots on the other side of the table say 'We need the most senior pilots to get $300,000 in pay and benefits.' The airline's response is 'The only way that could work is if we pay the new pilots $16,000 per year.' The group of senior pilots responds 'We can live with that.'"[0]
Baseless/Unsubstantiated comment. Unions come in when the people who are working there feel they aren't being treated fairly. Sure Free-market AA could offer better incentives to SOME, but at the detriment to MOST.
Argentina is a model example of what happens when the pilots have a strong union: they have the highest pilot salary in south america and there are consistent service outages due to strikes on holidays.
Fear not that if union workers could collect a paycheck without showing up to work and no consequence, you would not see any working.
Fixed that for you.
If you wish to talk about the 100% estate tax I'm willing to talk about it tho. https://www.youtube.com/watch?v=JPdjuPPtnWA
1. People selectively choose to care about whether another person or class of people can live without needing to work, and
2. People selectively advocate for contradictory universal statements about human nature depending on which humans they're talking about (in other words, applying different "universal" rules about motivation and behavior depending on whether the hypothetical person they're talking about is already wealthy or not).
jackvalentine said that the intended goal is shared by everyone. And then I agreed.
There is nothing immoral in living without needing to work. ITs sometimes the opposite: should mentally deranged people or children be forced to work or live free? Those leeches. In the future its possible nobody will need to work. Thats just not the world we live in today.
Sounds like a pretty good benefit for everyone involved.
> there are consistent service outages due to strikes on holidays.
Sucks for consumers, but your point was about the workers, not about consumers, etc.
Yes, its just a terrible one for everyone else. Thats the whole point.
> Sucks for consumers, but your point was about the workers, not about consumers, etc.
Consumers are workers. If we talk only about pilots, its also bad: the union prevents other pilots from being hired.
This is circular logic, isn't it? It's like saying McDonald's should only pay workers $3 an hour because I, some uninvolved person who happens to be a worker elsewhere, would like a cheaper hamburger. That's not pro-worker, that's pro-hamburger.
If the question is about a fair playing field between bosses and workers, I don't understand what a strike inconveniencing people has to do with it.
The artificial increase of wages has the same effect that the artificual increase of profits
Yes they can.
So while they dont all unionize, still some workers eat others.
Second some jobs are easier to unionize than others due to geographicalities. Farmers in the us have below minimum incomes. Their effective unionization has no limit on how much wages they could get. But because its impossible to be cohesive with small numbes and large distances it doesnt happen.
Unions form successfully by their capcity to limit supply. Anything that can be imported breaks unions. Anything that cant helps them. Thats why teachers, cops, garbage and transport are unions in the us, but electronic manufacture isnt.
Hope this is enough!
Did you know that unions have been illegal in various countries at various points of time? People still unionised and fought to have it made legal.
It isn’t always easy, but any worker can unionise. You seem to be confusing possibility with activity.
The prohibition of unions was a terrible thing indeed, and unions themselves have also been producers of tremendous violence, murder and oppression. There are no short examples of abuse.
Nevertheless, any union that has significant effects has them by providing new limitations on labor. You don't need to ban unions to make them dissapear, you just have to let labor roam free and then they dissipate instantly.
The barrier to entry for unionizing is a lot lower than getting rich and hiring a servant. That is not a comparable situation. Incredibly poor labourers and rich professionals alike unionize.
> you just have to let labor roam free and then they dissipate instantly.
We have completely voluntary unionism in my industry and people join the union voluntarily. You seem to have a _very_ skewed view of unions that only takes the negatives.
My union (Professionals Australia) takes a pragmatic view to labour relations. I resigned from my previous union because they didn't take that view and focussed on short-term gains for only a subset of their members.
I'm not making childish bets with you.
You have an... interesting... view of labour relations that I haven't come across before. Did you say you were Argentinean?
Professional licenses are one of the most classic examples of limiting supply. Classic as Adam smith, wealth of nations, 1776 classic, where he talks about the artificial restriction of a certain number of years of study to be able to exercise some labor skill.
Even if it did, I have no moral objection to labour banding together to restrict supply. It's just the free market in action. Actors (capital, labour, consumer) are free to band together and increase their functional power.
There is no perfect state of equilibrium in a market, just a temporary pause. Same goes for capital and labour - what works now won't work tomorrow and so constant tension and negotiation will occur. Some parties will lose and some will win. Either way the situation is merely temporary.
Or is the free market just for capital to band together to increase it's power?
It also has an interesting advocacy section:
- "At least 10% of the work carried out on Victoria’s major projects must be undertaken by apprentices, trainees or engineering cadets...we were able to make the case, and change Government policy."
On Privatisation of power - "As well, privatisation resulted in large reductions of the number of staff employed as well as significant outsourcing of important functions"
If you asked me, I'd say its unavoidable for unions to do these kind of actions the same way its unavoidable for private companies to try to monopolize a market. Its the basic incentive.
> Even if it did, I have no moral objection to labour banding together to restrict supply. It's just the free market in action. Actors (capital, labour, consumer) are free to band together and increase their functional power.
Sure, thats not really a problem at all. There are plenty of circumstances where that will provide real and palpable defenses against employers that have powers that shouldn't be. But dont mistake the debate of allowing unions to exist, and encouraging them.
Much like the biggest employer monopolies, the biggest union results come through the government. Unions lobby for the government to put rules, like the eng cadets or limit outsourcing, or require accreditations given by them, etc etc. If you had a union that didnt have the power of government to apply those rules, they wouldn't be very relevant.
> There is no perfect state of equilibrium in a market, just a temporary pause. Same goes for capital and labour - what works now won't work tomorrow and so constant tension and negotiation will occur. Some parties will lose and some will win. Either way the situation is merely temporary. Or is the free market just for capital to band together to increase it's power?
This is a common theme I find on this topic: capital monopolizes and gets profits they shouldnt, so why shouldnt workers do the same? Well, two wrongs dont make a right, and someone being a criminal and profiting from it doesn't mean we should all become criminals. Free markets are precisely a tool against forming monopolies, both on companies and on labor.
If you could effectively limit what CEO's make, the savings will go into the stock and investors, it will not raise wages, because wages are not set by CEO pay.
Think of the effects of a maximum wage in an economy. It cannot possibly help workers. It will definitely help investors/capitalists/employers.
Wages and bonuses are set by CEO decree. And they, across the board, set them as low as they can get away with so they hit their quarterly numbers and get their bonus.
But its not really true: wages are paid by the production of the worker himself. In a farm with a landowner, an apple picker picks 10 apples and pays 20% on the landowner. That is, his wage is 8 apples.
A guy comes in picks 100 apples. By the same rate, he would earn 80 apples, or the wage of 10 common apple producers. By the same nominal rate, he would earn 98 apples. The common producer has a lot to envy on that person, and might make a case for him getting 8 apples, 80 apples or less than 98 apples. But in any case whatever he lobbies for will go to the landowner, because the landowner already has lots of people that pick 10 apples and pay 2.
CEO pay is agreed in a market, and albeit there are interesting governance issues, it is truly drawn from investors. Personally I do believe investors are getting stiffed. ITs just not the solution to increase wages.
except it is not. A CEO of corp A is a member of the board in corp B. Disgraced ex-CEO of citi John Thain is on Uber's board now. I think Eric Schmidt was on Apple's board at some point? Point is the board is NOT representative of ordinary passive investors or even institutional investors like Vanguard. The passive investors have almost no leverage. How do you propose we level the playing field for the investors?
The easiest way to decrease CEO pay is to obviously..have more CEO's. Interestingly enough, the more the public disdains them, the less you have.
I actually agree with you more than I disagree with you. Beyond a certain point, higher wages are bad. I don't want much higher wages. I am just saying we need to cut wages at the top.
You can look to the TSA or the NYPD for examples of this happening in the US.
There are TSA employees who have patterns of repeatedly showing up to work drunk, sleeping on the job, or stealing from passengers' bags and have managed to keep their jobs, because
And let's not forget three years ago, when the NYPD openly refused to do their job for three weeks[0], but still got paid all the same[1].
[0] I'm not complaining that the NYPD stopped enforcing low-level drug offenses that shouldn't even be crimes in the first place, but they literally collected paychecks while openly refusing to do it.
[1] https://nypost.com/2014/12/29/arrests-plummet-following-exec...
But please. Do go on about how unions harm most workers.
If you'd like to continue making blanket statements about unions being harmful to "most" workers, I'll be happy to give you citations of what life in the mines was like before the unions.
Im from a country where almost half the employment is under the table, and the rest is unionized. Teachers, truckers and state workers enjoy plenty of perks and would defend like you are the role of unions. They should if they simply respond to their own incentives.
The result? Logistic cost is 50% the cost of food, education tripled staff and got worse results in the last decade and state spending is 50% of gdp.
The teacher can reminisce of how sad it would be for the kids if she didnt have such benefits or were fired and would ask you a name of who is being punished by her benefits. And you couldn't answer with a persons name like the teacher could. But its still very real.
It could mean that unions or some forms of unions (state-backing etc) are incompatible with certain cultures though.
The unions in america and Argentina are more similar to italian and spanish unions which are rent seeking and confrontational. In argentina, unions have constitutional level protection, and union leaders have pseudo diplo powers( they are harder to arrest for ex). The result is very rich union leaders and all industries where unions exist have terrible employment and costs
The result is much cheaper airfares and no loss in quality.
https://en.wikipedia.org/wiki/1989_Australian_pilots%27_disp...
Correlation is not causation and all that fuzz.
Also, that piece of propaganda conveniently forgets that Avianca just suffered the longest ever strike in Colombia, not really the most worker or union friendly place.
I get the point. Pilots however, are super interchangeable, like software engineers. There's no reason peruvian, brasilian, paraguayan , brazilian and chilean pilots wouldnt move to argentina to work and depress wages. Except the biggest payer and employer of pilots in argentina is the State. And it doesnt hire that many foreigners, for some reason...
> Also, that piece of propaganda conveniently forgets that Avianca just suffered the longest ever strike in Colombia, not really the most worker or union friendly place.
I dont know what colombia has to do with argentinian pilots.
Of course, that would never work if they had made an error in their purchase of jet fuel futures -- the futures market does not have a do-over function.
The union is forcing the company to be professional in its dealings with employees, in the same way that it is professional in its dealings with vendors, regulators, bankers, customers -- pretty much every other stakeholder.
Case in point: several years ago when I was an SA we were having some sort of big piece of Verizon equipment in our office due to our bandwidth and phone demands. The guy was coming from Philly (to upstate ny) and was on his 10th consecutive day, on a Sunday, on a holiday weekend at like 3 AM and a forced double shift. I think he said he was on something like 10x overtime.
Even paying that kind of ridiculous OT was preferred by them vs hiring more CWA guys. CWA is/was a stronger union that would strike over that kind of cap.
free markets precisely allow participants to join together (e.g., unionize) to strike better deals in the marketplace (in fact, that was one of the original advantages of forming a company, to band people together to gain market power).
You had a choice. It just wasn't a fair one.
Being more serious for a minute, can you explain why you think like that? With data, not anecdotes.