a question regarding unions and profits

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Agent of the International's picture
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Dec 5 2013 01:02
a question regarding unions and profits

In my labor economics course, we have homework on an online discussion board in which the central topic is unions. And we are being asked whether or not we agree or disagree with a statement that basically goes like this, 'unions reduce the profits of capitalists, therefore the economy would be better without them'. And one student was like, "well profits aren't necessarily good for the whole economy", which is obviously totally wrong. I think the statement is correct, but that doesn't necessarily mean I'm anti-syndicalist. How would go about addressing this without seeming to be pro-capitalist?

Agent of the International's picture
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Dec 5 2013 01:05

Or maybe the statement is not correct? Maybe it depends on the circumstances?

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Dec 5 2013 01:17
Joseph Kay wrote:
It doesn't. A bigger wage share is a lower share for capital, suppressing the rate of accumulation and hence economic growth.

I wish I could use that tweet.

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Dec 5 2013 03:42

To answer the statement "unions reduce the profits of capitalists, therefore the economy would be better without them" that you want to test, there are a few variables that can be considered first:

Social democratic trade unionism and syndicalist unions are not the same thing:
- Social democratic trade unionism supports social partnership, so it has for more than a century been part of the management of the workplace and workforce. It has a vertical decision making structure and it is developed to suit the hierarchical "economics" of capitalism. It has surrendered the future to employers, considering that we are unable to reach a further stage in evolution beyond capitalism.
- Syndicalist unions are opposed to capitalism and are historically linked to revolutionary opposition to capitalism and the state, arguing for the "abolition of wage slavery". For a historical account of syndicalism, try the history of direct actionists within the IWA and IWW for the best examples. Anarcho-syndicalism is a fusion of anarchism and revolutionary syndicalism.

Now to answer your statement "unions reduce the profits of capitalists, therefore the economy would be better without them" -

I would argue that the answer for the statement for social democratic trade unionism is NO because social democratic trade unionism often openly co-manages workers along with employers, and does not have the credibility to challenge employers (employers and other reactionaries will probably argue YES in this case also because officials of social democratic trade "unions" can lose control of its membership, and recognising that despite that trade unions have taken up the role of counterpart to managers, social democratic unions are constrained by the fact that employers have directly opposed interests to their membership). In my view social democratic trade unions and parliaments are equally toothless methods of organisation. Of course I'm not recommending autocracy as an alternative (that is what reactionaries propose).

I would say that the answer for the statement in relation to syndicalist worker unionism and other forms of worker driven organisation (such as workers councils etc) is YES/NO because we aim to attack the profit motive of capitalists by means of organising workers at a base level, and we have been criminalised and massacred in many counties throughout the world for our efforts, but rather it is an inadequate and reactionary question. As a syndicalist I understand that "economy" is the product of the working class, we create wealth, it's us who build the cities, homes, workplaces, communities, schools etc and produce and develop all we know today in terms our shared experience, in every field of manual and brain work. This is the legacy of the working class.

BUT then again, the statement could to turned upside down to ask why it is that we need capitalists, employers and politicians? No reasonable answers come to mind.

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Dec 6 2013 02:01

Thanks for the response.

I agree with most of what you wrote regarding the differences between trade unionism (sometimes called 'business unionism') and syndicalism. Although I do have a problem with this, maybe I'm a bit picky:

AES wrote:
Anarcho-syndicalism is a fusion of anarchism and revolutionary syndicalism.

Anarcho-syndicalism is a tendency that is conscious of the origins of the syndicalist method of organising, which is the anarchist movement itself, and regards it as the primary means of achieving the self-emancipation of the working class, i.e. communism.

I think I wasn't clear enough when I wrote my original post. When I wrote 'unions reduce the profits of capitalists...', I meant after winning increased wages and benefits, not really so much when unions threaten capitalist' profits when going on strike (which is the point).

Although I still enjoyed your post.

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Dec 6 2013 02:25

Good luck with your course.