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Why Unions are Shrinking

According to recently released 2012 Department of Labor data the rate of unionization -- the percentage of American workers belonging to unions -- declined faster under President Obama’s first term than during two terms of President George W. Bush. Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor and senior fellow at The Manhattan Institute for Policy Research, argues that the President’s own anti-business policies are largely to blame. This is not as counterintuitive as it sounds.

Writing in the Washington Examiner, Furchtgott-Roth observes that the total unionization rate declined from 11.8 percent of wage and salary workers in 2011 to 11.3 percent in 2012. Private-sector unionization fell from 6.9 percent to 6.6 percent, and the government unionization rate dropped from 37 percent to 35.9 percent. The total Obama-era decline is 1.1 percentage points, compared with 1.1 percentage points during the eight Bush years.

“Although Obama has championed union causes, his tax and regulatory policies have systematically discouraged business investment and job creation in America for all workers — union and nonunion.In addition, U.S. corporate tax rates remain the highest in the industrialized world. Inefficient regulations add to production costs and make employees into liabilities.

Obama vetoed the Keystone XL pipeline from Canada to the Gulf of Mexico, which would have provided thousands of unionized construction jobs. Instead, Canada is planning to ship the oil it produces in its western provinces to China. Too bad for American members of the Laborers’ International Union of North America. More jobs for Canadians.

Obama’s Environmental Protection Agency regulations have resulted in the closure of more than 100 coal-fired power plants over the past two years, with more scheduled. That’s too bad for the United Mine Workers of America and for the International Brotherhood of Electrical Workers.

In 2009, Chrysler and GM were given government bailouts, disenfranchising existing creditors and transferring assets to the United Auto Workers. Despite the bailout, if your price can be beat, you can’t compete. On Jan. 15, Chrysler announced that it would be expanding Jeep production in Guangzhou, China, rather than in Toledo, Ohio. Too bad for the United Auto Workers.

Under Obama’s Patient Protection and Affordable Care Act, firms with more than 49 workers face a $2,000-per-worker tax if they don’t offer the right kind of health insurance. That’s fewer full-time jobs, but more part-time jobs, because there’s no tax on part-time employees.

President Obama did everything he could in his first term to help unions. His stimulus package was directed at public-sector unionized workers. His executive order on project labor agreements required large construction projects to hire unionized workers.

Obama supported the misnamed Employee Free Choice Act, which would have taken away workers’ right to a secret ballot in elections for union representation and would have imposed mandatory binding arbitration on employers and workers who could not agree on a contract.

He “recess-appointed” three members of the National Labor Relations Board when the Senate was not even in recess. One member, Richard Griffin, has been accused in a lawsuit of using threats and extortion to cover up an embezzlement scandal when he served as general counsel for Local 501 of the International Union of Operating Engineers.

Labor Secretary Hilda Solis, the daughter of union activists, rolled back union financial transparency rules put in place by Bush Labor Secretary Elaine L. Chao — rules designed to show union members what their union was doing with their dues.”

Interestingly, she adds that Obama’s efforts to help unions have not stemmed the tide, and union membership continues to accelerate its decline. Right-to-work states, where workers do not have to pay dues to a union as a condition of working, have created more jobs than forced unionization states. Over the past 25 years, the 22 right-to-work states (not including new right-to-work states Indiana and Michigan) created 1.5 times as many jobs as the forced unionization states.

The lesson, she argues, is that whether you like unions or not, anti-business policies drive jobs offshore. That’s why union membership has fared worse under Obama than under Bush.

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