Tuesday, December 30, 2008

Enjoy your daily print newspaper. It's later than you think . ... 1:02 A.M.

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Magical Moment: One seemingly sure sign Obama is actually, really not going left, at least on economic policy: Robert Kuttner isn't sucking up!** Instead he's frankly anguished about the incoming economic team. ... P.S.: OK, there's a small, vestigial suck-up at the end. ...

**--For Kuttner's 1992 flattery of president-elect Clinton, click here , search for "epic." ... 12:47 A.M.

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Monday, December 29, 2008

Fire Fire Mickey Kaus . They're falling down on the job. ... No wonder I still have this gig.

Update: They've been spurred into action, arguing

It's true that unions are poor vehicles for equitable distribution of wealth. They have also failed to cure cancer, and they haven't done anything to stop Russian aggression in post-communist Europe.

Now it's obvious unions are "poor vehicles for equitable distribution of wealth." Please tell it to Kevin Drum (and Paul Krugman ). ... 7:26 P.M.

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Life in the Left Cocoon:   Promoting the Southern, corporate, anti-UAW agenda, Kevin Drum says he's "open" to "good-faith efforts to address reform" of "mushrooming work rules." But he's still for greater unionization:

Conservatives flatly oppose anything that gives labor any additional bargaining power, full stop, and that doesn't leave much room for compromise. So unions it is. Especially in the service sector, they're pretty much the only idea on the table for seriously addressing low-end wage growth, and that means I'm for 'em. [E.A.]

The only idea on the table? How about restoring economic growth and creating a tight labor market, giving all workers (not just the unionized) greater bargaining leverage? That's the traditional Clintonite formula , no? To that you could add border control to ensure that competition from unskilled immigrants doesn't undermine leverage among lower-wage workers..... Drum goes on the cite Ezra Klein for the proposition that:

the last great leap forward for unions was during World War II, and the last great expansion of the American middle class followed in its aftermath. In contrast, the most recent expansions -- which have largely occurred in the absence of unions -- have benefited America's rich. [E.A.]

Huh? The biggest recent expansion, during the '90s, a) benefitted Americans at all levels, but especially average workers and b) occurred largely while union power was ebbing. The Clintonite formula worked. Maybe it can't be achieved again. Maybe it's flawed because (sorry!) the rich got richer too in the Clinton years. Maybe a return to Carter-era union power will be better still! But those are arguments Dems like Drum and Klein won't even deign to make as long as they keep reassuring each other that they not only have the best ideas around but the only ideas around. ...

P.S.:   Klein also argues;

The countries with the world's highest growth rates -- the Nordic economies -- also have some of the world's highest rates of unionization. Denmark, Sweden, and Finland all approach 80 percent. 

There's an argument that in countries with 70-80-90 percent unionization, unions have to be more responsible--union leaders know that any inflationary wage increases are going to be paid for by their own members (who are essentially everyone), and they know that any declines in productivity will hurt their own members (essentially everyone). Not only do they have an incentive to be reasonable, but they have the power to keep their own membership--say, those unions that could get bigger-than-average increases by striking--in check. But we aren't going to get 80% unionization. We're going to get 20-25% or 30% unionization, with unions that are powerful enough to cut good deals for themselves (and impose resulting price increases on everyone else), but not so large that they have to take everyone's interests into account. ... (This is point made by Mancur Olson and noted by Robert M. Kaus a year before Klein was born.  Yikes.) ...   4:06 P.M.

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They Said It Couldn't Be Done! How to Make Caroline Kennedy More Boring:  Caroline Kennedy's ragging of NYT reporters, for which she's now being pilloried , is of course one of her better recent moments :

NC: Could you, for the sake of storytelling, could you tell us a little bit about that moment, like, where you were, what you said to him about your decision, how that played out?

CK: Have you guys ever thought about writing for, like, a woman’s magazine or something? (Laughter)

DH: What do you have against women’s magazines?

CK: Nothing at all, but I thought you were the crack political team here.

Kennedy's bristling at the embarrassing, sentimentalizing conventions of journalism (at Newsweek the question was always "what were you eating") and isn't afraid to invoke some undiplomatic truths (i.e. women's magazine's often run softball crap). Either she'll keep it up--in which case maybe there's something to the idea that she has the virtues of an independent outsider--or, more likely, she'll become even more safely platitudinous. ... 3:19 P.M.

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The Aribtrariness of Wagner Act Redistribution: Richard Posner makes an essential point usually overlooked by those on the left who instinctively support unionism in the hope that it will achieve some sort of just redistribution of income:

The redistribution of wealth that they bring about is not only fragile ...[snip] ... but also capricious , as it is an accident whether conditions in a particular industry are favorable or unfavorable to unionization. [E.A.]

Or, as Robert M. Kaus put it in very small type in 1983 :

The "economic power" that the Wagner Act gives unions is determined by all sorts of factors that have nothing to do with the moral basis of a union's cause . Workers who work in a single location, for example,are easier to organize than workers who are geographically dispersed, even though the latter may work in sweatshops and the former in comfortable, lighted factories. Some industries are extremely vulnerable to strikes--industries that deal in perishable goods, for example, or industries (e.g. Broadway theaters) where you can set up a picket line that will intercept a lot of customers. In other industries, advances in technology have weakened the power of strikes, as petroleum and chemical workers discovered when they walked out and found that skeleton crews of supervisors could run computer-controlled refineries for a long time. Did the chemical workers deserve to be paid less simply because their industries had become more strike-proof?

This arbitrariness is not just a trivial side effect of the collective bargaining system. A truism within the labor movement holds that "the workers who need the unions the most don't get them."  .... The answer of labor leaders to this dilemma is simple: more unions. .... But even if the law required unions in every workplace, there is no reason to think wage inequalities would shrink in any systematic fashion. Sol C. Chaikin, president of the International Ladies Garment Workers Union, often complains about the "two-tier labor force" in the United States--but he is complaining about a disparity that exists within the ranks of organized labor. ... The Wagner Act gave Chaikin's union the power to strike. Unfortunately, fate did not give it any of the chance attributes that might enable it to use strikes to boost wages dramatically above their market levels . [E.A.]

If you organized the operators of drawbridges going into Manhattan, under the Wagner Act your union will be able to extract quite a premium by striking. If you organize fast food workers, not so much. I've never understood why leftish idealists ever bought into the idea that this is distributive justice. ... 1:12 A.M.

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Sunday, December 28, 2008

Two year-end TV roundups-- by Tom Shales and by Inside Cable News . One of these guys is paid an incredible amount of money. And one of them phones in a list of usual suspects. ... P.S.: From the other one :

Unlike NBC’s very public axe wielding, CNN’s cuts came about suddenly as a bunch of on the air talent lost their jobs. Most notable loss; CNN veteran Miles O’Brien. CNN has yet to publicly account for all this talent loss, which flied in the face of the public posturing done by Jonathan Klein regarding how his network was in the money.

Jonathan Klein, dissembling? We're shocked. ... 7:00 P.M.

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Friday, December 26, 2008

Don't Blame Gettelfinger: Rand Simberg's anti-UAW-work-rule post was better than mine . He has horror stories, including his own--noting that there are too many floating around for them to be "merely anecdotal." (Another bit of confirming evidence: The union firms went broke! Non-anecdotally broke.) Simberg makes a point that's especially relevant now that the UAW is arguing that labor is only "10% of the cost of the vehicle ."

And the rules don’t just affect productivity — they affect quality as well. When you can’t discipline employees for being absent without leave, when you have to bring in unfamiliar workers to fill in for them, when you’re missing half your plant during hunting season — yes, the stories about avoiding buying cars built on Monday or Friday in the fall are true — you can’t expect to put out a quality product, regardless of how well or poorly designed it is. You particularly can’t expect to do so when the union rules put all responsibility for quality and production on management, but give them no authority to manage the workers and provide the workers with no incentive to build a quality product if they lack the personal pride to do so. [E.A.]

Labor may only be 10% of the cost of the vehicle, but it's still going to be a vehicle nobody wants to buy if it's poorly made . ... Note: The UAW does make some high quality cars, especially at the NUMMI joint venture with Toyota in San Jose, where they threw out the UAW work rule book. Why couldn't GM successfully spread the NUMMI system to all its other plants? Ask the UAW. ...

P.S,: Here's a  Business Week profile of the UAW president Ron Gettelfinger. Seems like a reasonable guy! But that's the point. Gettelfinger isn't the problem-- I suspect, for example, that the UAW leadership knows pretty well what the problems are in its factories. The problem is the system, the American adversarial labor-management negotiating system, in which reasonable people doing what the system tells them they should do wind up producing undesirable results.  Just as negotiating over work assignments means factories adjust too slowly to generate continuous efficiency improvements (which often involve constantly changing work assignments)  negotiating ponderous 3 year contracts (in which Gettelfinger must extract every possible concession to please the members who elected him) means contracts adjust too slowly to save the companies from failure if market conditions change.  From Business Week :

[T]here is a pragmatic Ron Gettelfinger as well. Three years ago, the automakers were in trouble, and he knew that without concessions there would be no jobs for his members to report to. When Detroit came looking for givebacks, Gettelfinger ultimately agreed to a contract that set back starting factory wages 30 years: New hires will begin at $14 an hour—half the wage for veterans and a pay scale not seen since the '70s. Plus, he has watched the Big Three cut some 80,000 jobs since 2005.

That also brings up a key criticism from Detroit's executives. Gettelfinger made those key concessions starting in 2005, but not until Ford and GM were reeling toward massive losses. The union has never given enough to get the companies ahead of the curve . "It's always a day late and a dollar short," says one former GM executive. [E.A.]

See also this interview , pointing out that the $14 wage scale for new hires hasn't had an impact because nobody new is being hired by the UAW's employers, who are shrinking, not growing. The obvious alternative to cutting the pay of nonexistent future workers would be to cut the pay of existing current workers--but they are the people the system tells Gettelfinger he needs to please. ...

Fifteen years ago, at the start of the last Democratic president's administration. incoming Labor Secretary Robert Reich famously said "The jury is still out on whether the traditional union is necessary for the new workplace." Tactfully put. This fall, if not earlier, the jury came back. 5:19 P.M.

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What's Worse Than Camelot? Cuomolot! I should say that I'd certainly prefer Caroline Kennedy to at least one candidate for Hillary Clinton's seat. That candidate would be Andrew Cuomo. Caroline may be boring but she does not seem evil! (For some links on why I think Cuomo is a thuggish irresponsible opportunist , click here . I also had some unpleasant dealings with his self-promotion machine at HUD, when they were busy hyping and distorting some homeless statistics in order to get his name in the paper.) ... These are not the only two people in New York state, however. ... 4:30 P.M.

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