Published in the National Post on May 30th, 2012
GDP has stagnated as we cozy up to unions
From Timiskaming to Niagara, from Thunder Bay to Ottawa, Ontario has legislation that denies individuals one of their most basic human rights. We have legislation that unemploys or underemploys thousands and that erodes the productivity of Ontario.
Whether you believe it came from Pierre Trudeau’s Charter or a God-given right, you are endowed with the right of freedom of association. You have the right to determine what people you deal with, what organizations you support, what political party you would like to join, or none at all. But it is illegal for you to choose whether you want to be part of a union or not, when there is a union in the workplace.
In Ontario, it is completely legal to force, coerce, or bully people into joining a union. What’s even worse is that the law actually makes it easy to happen. Take, for example, two carpenters working for the city of Hamilton. They showed up for work on a Saturday and used a nasty trick called “card-based certification” to unionize not just carpentry tenders but all construction work in the city that might include carpentry.
The result was that 243 of the 260 contractors registered with the city, or 93.5%, are not allowed to bid on city projects, because their workers chose not to be unionized.
The 17 unionized workforces registered with the city gained monopoly privilege over all city contracts.
The effect of Ontario’s legislation isn’t just to undermine one’s rights, but to force inequality on the people of Ontario under the guise of equality.
According to Statistics Canada, the average unionized worker in Ontario makes 25.7% more than their non-unionized counterparts, not including benefits. What’s unfair is that this comes at the expense of all taxpayers and non-unionized employees who are frozen out of public-sector projects.
Union members receive fatter cheques because they constrain an employer’s labour supply. It’s all supply and demand. When there are fewer labourers, their wages rise. Even ECON 101 textbooks will tell you that labour unions are significantly responsible for wage rigidity and, in turn, structural unemployment. The classic union argument that union members’ increased wages are at the expense of their greedy corporate bosses is simply untrue. Depending on the study, you find that the entirety or the majority of their wage increases come at the expense of the wages of the remaining 80% of workers. And that’s if they are not unemploying them.
This unfairness — this government-supported unemployment or underemployment of thousands — is compounded with economic stagnation. Over the past nine years of cozying up to the unions, Ontario has seen its inflation-adjusted per-capita GDP grow by a paltry 0.86%. And if our productivity were not bad enough, our labour policies are actually forcing jobs out of Ontario.
Take, for example, the Electromotive plant in London. The firm was in a bargaining battle with the local union. Electromotive wanted to introduce a new pay scale that would not affect any current employees. It did not want to fire any current employees. All it wanted was the flexibility to pay unskilled new hires less than current employees. New unskilled hires would still be paid well above minimum wage; new skilled hires would be paid the same as before.
But the CAW thought that future union dues were more important than the jobs of workers. Electromotive decided to shut its doors in Ontario and move to Indiana’s green pastures. This meant that 240 workers lost their jobs — and their high wages — when they wouldn’t have had to lose either if their union had let them decide.
There is a solution to the repression of our rights and freedoms, to our stagnating economy and to our jobs crisis here in Ontario.
Jurisdictions that emphasize workers’ choice grow the fastest. It should be no surprise that Alberta and Saskatchewan are the economic engines of Canada today. It should be no surprise that Denmark is leading the EU. It should be no surprise that states with right-to-work laws have had quintuple the private-sector job growth of non-right-to-work states from 1990-2006, according to the U.S. Bureau of Labor Statistics.
Ontario should be learning from places like Alberta, Texas and Hong Kong. If we want to unleash the productive capacities of our workers and of our workplaces, we need to reform our labour legislation so that individuals can chose how they want to work. We need to bring back freedom of association to the workplace
If we want to get a rusty wheel moving again, we spray some WD-40 on it. If we want to get a rust belt working again, we need to bring freedom, justice and democracy back to the workplaces of Ontario. That’s why I’ve introduced worker’s choice legislation here in Ontario.