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Joi Ito's conversation with the living web.

I recently had the opportunity to meet Andy Stern [WP] and and hear him speak. Andy is the president of the Service Employees International Union, the largest and fastest-growing union in the United States and Canada. He recently walked out from the AFL-CIO and Matt Miller in Fortune Magazine recently commented that, "Stern's move is possibly the most significant economic event of the year."

Andy's speech was passionate and compelling and made me think that he should be leading a political party. I wish we had people like him in Japan.

He fielded a number of tough questions about the failings of unions and his response was that unions have their problems and they need to be addressed, but that there were many issues that would never be resolved without unions. When presented with some examples of dysfunctional unions, he said that you had to blow up the bad unions before incrementally fixing them.

He said that "there is enough money. It is just not distributed properly." "I love philanthropy, but I want to allow people to be independent and provide for themselves." He made a solid attack at the notion of CEOs walking away with millions of dollars while cutting benefits for workers, and then turning around and setting up foundations to "give to the poor."

One person in the audience gave the example of a company which was picketed for using an un-unionized contractor. The person complained that they had a good relationship with the contractor and didn't want to switch just because these unions were picketing. Andy pointed out that the contractor would probably walk down the street and jump up and down if the company told them to. Why not tell the contractor to get unionized. It is the responsibility of the company to help the workers in the contractor and encourage them to become unionized.

I grew up in a fairly liberal environment and I heard a lot of war stories from union organizers. I've also seen union organizers abusing their power. Like Andy, I believe that their benefits outweigh their cost and that we should be thinking about how to reinvent them. They have developed a tainted image over the years and hopefully Andy can help change that. I support Andy in his efforts and believe that people like him may be able to save the Democratic party of the US by talking to the concerns of the working class instead of alienating them.


To have lived and grown up in a "syndicalisme" (French word for it) environment, I can fully agree that it's a fundamental part of the system. It's a kind of equilibrium mechanism, not many people understand that. It's a way to organize discussions, it's a way to broaden the participation.

As to be a leader of a party, not necessary. It's not because you are good in a position that you will do good things in a slight different context. Unions have a lot of interactions with political parties, they are often very politically oriented, but their role is not the same of a political party.

Another kind of food for thought, there are very different styles of Unions depending on the culture and the country. Issues, priorities, history, way of "fighting" are not the same depending on the country.

Joi, check out the work of Mancur Olson. In particularly, you'll find it worthwhile, particularly when combined with small worlds and Granovetter.

Let's not get all teary-eyed about this. Note that I am talking largely about the Irish situation, where there are strong protections for workers (and for the most part, that is a good thing). I appreciate that the US situation is somewhat different.

The head of an Irish transport company recently told me the story of a visit by a senior union organizer to a university class. He was talking about the role of unions. He explained to the young audience that his business as a union organizer wasn't dialog or cooperation or any of that stuff. His business, he said, was 'trouble'. It's the union's job to cause trouble for the employer so he'll give the employee a better deal. It's as simple as that.

At present, Irish rail drivers are threatening to strike because they are being asked to drive longer trains without any additional compensation, even though the length of the train has no effect on the work they actually have to do.

I'm also reminded of the story (told to me first hand, by an official in an EU country) of the senior union organizer from the main power company who rang warning that the politician in charge of energy matters should not expect to get to the end of his term of office 'without us turning the fucking lights out'.

You would expect unions to take the side of the weak party. In Ireland they frequently take the side of the big guy. For example, they have entered an arrangement with large Irish employers (Tesco and Dublin City University come to mind) whereby permanent, pensionable employees are compulsorily required to join the Union, whilst temporary, lower-paid or contract staff are not permitted to join the Union. Similarly, representation of foreign workers working on major construction projects in Ireland has been haphazard, to say the least.

This is the thing to remember: a union is primarily a business, which strives to build its revenues and influence whilst minimizing its costs. It provides a representation service to employees in return for the subscription. Like any business, the management (union organizers) will do whatever they can to keep the business expanding, thus guaranteeing continued paychecks. Sure, it has a philanthropic aspect, certainly, but in a developed economy, this is less and less apparent. Many unions are more like outsourced HR operations than a political movements.

It is completely silly of Andy Stern to suggest that the company should force its contractors to get unionised. Surely the contractor has the right to run its business whatever way it wants? Maybe the contractor has a share scheme or profit share system in place and conducts its relations in an honourable way without the need for unions.

If the staff are reasonably well paid, and employees haven't been forbidden from joining a union and the market is reasonably buoyant, it's a stupid point. Andy Stern talks about unions as though they are fundamental to good industrial relations (they're not) or that it is morally wrong not to encourage unions (it isn't).

In knowledge work, unions are basically irrelevant. Why? Because published payscales with common increments are no longer workable. There is just too much difference between the most effective workers and the average or poor workers, so employers negotiate individually with all employees, offering a mix of money, stock and benefits. At the same time, the demarcation between 'worker' and 'manager' is becoming fuzzier and fuzzier. The world is becoming like Hewlett Packard: everybody seems to be a manager of something.

As a result of the breakdown in payscales and increments, you can't have collective bargaining in any meaningful sense. And although the union might be able to help you out if there's never any coffee, or if the air conditioning doesn't work properly or maybe if your boss victimises you, the union won't be any help whatsoever to you when it comes to negotiating your pay and bonus for next year.

At the end of the day, money is what it's all about, and if the union can't help the employee get more of it, it's not worth paying the sub.

Antoin: I guess I would disagree. I believe there are unions that do not function properly, but unions are not necessarily businesses that try to make money and becoming rich is not the motivation of good union organizers. I know companies that have encouraged unionization out of principle. The first company I worked for did and the CEO and the union had a very good relationship. I think a well run union provides a way for the employees to communicate with and have a relationship with management.

There are statistics that show that non-union staff don't get paid as well as unionized staff so "if they staff are reasonably well paid" isn't really that appropriate. Also, benefits and insurance are sometimes difficult to organize on your own.

I think you just have to look at the terrible condition that some workers still have to work in. No benefits, low pay and terrible working conditions. The government doesn't step in to help. Unions are necessary in these situations.

Again, I don't think all unions are good. In fact, many are bad, but I think that painting them all with one brush is not fair.

At the end of the day, money is what it's all about, and if the union can't help the employee get more of it, it's not worth paying the sub.

Da bottom line.

"Again, I don't think all unions are good. In fact, many are bad, but I think that painting them all with one brush is not fair."

So it's sort of like saying that to discourage unionization as a blanket policy would be like throwing the baby out with the bath water?

"At the end of the day, money is what it's all about, and if the union can't help the employee get more of it, it's not worth paying the sub."

I disagree. Money is NOT "da bottom line". There's much more that a union can ensure, including better working conditions and a sense of security in the lives of the workers. And I believe factors like these outweigh or at least equal the monetary benefits of unions. In a world of profit-hungry corporations, there really HAS to be a system to keep them in check. Occasionally the system is dysfunctional, but the spirit behind it must not be questioned. There are big problems in the implementation of a concept like Democracy, but few question the spirit behind it.

I agree Nev.

Antoin --

Your economic analysis might apply if workers and employees had equal power in the labor "market," but they don't, and that's why unions are formed, as a kind of equalizer.

The gas laws we learned in chemistry class apply to ideal gases, made of infinitely small, infinitely elastic atoms. In many cases, real gases behave very similarly to ideal gases, so the gas laws are useful within a certain domain of experience. But there are cases in which the behavior of real gases is sufficiently different from that of ideal gases that other reasoning tools are required. Similarly, when economics claims to be some kind of Delphic oracle revealing truths about the fabric of reality, I think we have to ask if we're doing some excessive extrapolation. For example, is it generally true that markets consist of many producers selling to many consumers? Because only in this situation do both sides of the table have equal power.

What is the proper domain of economic analysis? Economic activity makes possible more productive and efficient interactions among people. The abstraction of money makes it a lot easier to get your horseshoes made than if you had to barter sheep or bushels of grain directly to the blacksmith. Markets are a means to the end of better life for actual, individual people. Market mechanisms grow directly out of this, in service to us, the people. An economic system justifies its existence by enabling people to live better. But, paraphrasing Jefferson, whenever an economic system becomes destructive of these ends, it loses its legitimacy.

Currently, a large company can hire people to make sneakers in Vietnam, where one set of market conditions prevails, and sell them in the US, where those conditions are quite different. Sweatshop issues aside, the Vietnamese workers don't have to rent housing in Silicon Valley, or even in South Carolina. Who benefits from this huge spread between prevailing costs in Vietnam and South Carolina? Well, it ain't the workers in either place. I claim that an economic system that gives rise to a desperate "race to the bottom" among the vast majority of participants (that is, those who live by their labor) is a system that produces an evil result.

In response, I've been told that, according to the theory of The Market as Oracle, international labor costs will reach equilibrium at some point, the Vietnamese workers will become more prosperous, and maybe rents in South Carolina will decrease so everyone will be happy, or at least as happy as they deserve to be, according to The Market. But even accepting that The Market is a proper arbitrator of all values (which I don't), the notion of "equilibrium" is like the place where parallel lines meet -- none of us will ever experience it. Economic reasoning based on what happens at equilibrium is of limited relevance since human experience occurs under conditions of disequilibrium.

As for HP being unsuitable for unionizing, well sure, I imagine that if I were an employer, I might well want to make everyone a "manager of something," so nobody would join a union. Hey, even let 'em make a decision or two, so they identify with the ownership class. Don't have to give 'em much of a raise, because, as Milo Minderbinder said, "everybody gets a share!"

both Nev and Fingal made wonderful comments. Thanks for this.

Syndicalisme. Legal syndicalism is born in the years of 1880 in Western Europe (1884 in France). One of the difficulties arising these days is due to the changes in the work organization structures. In Western countries, there's a tendency to have more individual jobs, micro-jobs and then it becomes more difficult to create unions and to take actions for protecting your rights.

Unions are not only here in reactions, but also as a participation. For example, in some structures, let's take an hospital in France, there will be a comity composed from the management, the doctors, the rest of employes (represented by unions) and the local political powers. It helps to manage the life of the hospital collectively, to move forward and to make progress on work conditions, and to improve both the life of the employees and the structure of the organization.

The public complains about strikes, for example in France. But that's the emerging part of the iceberg. The real work is made on a daily basis as I said in the previous paragraph, dealing with management about many things from optimization of work, to condition of work, to conflicts between employees, or conflicts between employees and management (harassment, power abuse or someone slacking).

Unions are a necessary tools, it's really part of the system.

I'm not saying that unions are always a bad thing, or that they are necessarily a bad thing. It's hard to imagine the economic progress we've seen in the West in the 20th century without unions or something very like them. What I am saying is that in practice, in our modern society, they are often a bad thing.

I'm sure Karl is aware that there are serious problems with syndicalisme. He doesn't mention that worker-directors are a compulsory part of corporate life in many countries in Europe. He is certainly right that the strikes are just the tip of the iceberg. The stories that have come out in Germany about plying worker-directors with alcohol and prostitutes show that there is quite a bit lurking behind the surface. (See for example,1518,365752,00.html)

I accept that this was a perversion of the system, but we have to be realistic. There are serious problems with worker-director systems too. It is a very limited form of worker participation. Workers should participate at every level in a company. Participating at the board level is meaningless unless there you are also participating at the lower levels.

(I am uncomfortable with the dichotomy between 'workers' and 'management' but I will live with it for the sake of having the discussion.)

There are also structural problems resulting from the French system. Over-regulation brought about by union action has played a big part in bringing about economic decline in Europe's old economic superpowers. The only part of the French economy that is booming is the Black Economy, which operates out of the reach of unions and government. When such a large proportion of the economy is black or grey, without proper regulation to give workers even basic protections, it makes a mockery of the work of the government and the unions toward social progress.

The bit about HP and unionizing, that was meant to be a joke. The old joke about HP is that everyone is a manager of something at HP. I wasn't commenting on whether unions at HP were or weren't a good idea.

It is undoubtedly the case that work in the Western world is no longer about making motions or following instructions - it is increasingly about taking responsibility, taking the initiative and making decisions -. This may be partly a construct of the companies, but in large part it is a change in the nature of the work itself. The fact is that unions aren't good at negotiating packages for people who do this type of work. Whether you are a 'fan' of unions or not, I think it is difficult to deny this.

Now, I am not going to deny that companies don't take advantage of the ineptitude of unions for these situations to avoid giving employees the best possible deal. But denying that the fact that this fundamental change in the nature of work is going on is just being naive. I'm pretty sure that Andy Stern would agree that unions are losing there relevance in the modern workplace.

I don't agree that all parties are losing out when a company moves its manufacturing to Vietnam. The people in America are losing out for sure. But the people in Vietnam are also gaining. I don't think the poverty and uncertainty of a rural, agrarian economy is really fully appreciated here. I have grown up with sight of a declining agrarian economy at first-hand, and it is not a pretty sight.

I don't see any analogy between the gas laws and the labour markets. I didn't say anything significant about economics, other than that people were unlikely to be willing to pay for something that didn't bring them any significant benefits in either the short or long-term. I certainly didn't say or imply that the market is an 'Oracle'. That is just a straw man Fingal has constructed. I wouldn't say that, because I don't think it is, and it doesn't follow from anything I said. Why doesn't Fingal tell us what significant benefit a worker in a position of even moderate responsibility in a modern IT company would get from being in a union?

I think human societies and organizations have to respect the dignity of the human individual and to nurture human beings to achieve their full potential. Human beings have to be treated as ends in themselves, not as means to some other end. Undoubtedly the actions of corporations sometimes result in people not being allowed reach their full potential and in people being mistreated. However, just as often, the actions of unions (and for that matter, governments) result in people not being allowed to achieve their full potential.

There is a general problem with large organizations, not just for-profit corporations.

For example, if Andy Stern suggests using a union's power to lock out workers and force a contractor to run his business in a different way, he is deliberately running down the potential of a group of people to do organize themselves and do good work. (In the example given, it would appear the business was running perfectly well and was able to attract employees in a buoyant economy and there appeared to have been no other industrial dispute that would have suggest a strike-breaking situation.) That is a wrong thing to do and Andy Stern leaves himself open to the accusation that he is principally interested in increasing his own organization's cashflow and political power. (If he wants to stand outside the workplace and hand out leaflets outside the workplace explaining why negotiating through a union is better than dealing directly with the boss, then he should be free to do so.)

Equally, when a union takes over the relationship between workers and management it often results in workers and managers not being able to engage directly with each other to sort out workplace problems. Again, that's forcing the workers into being a cog in the system, under centralized control. They may be a union-controlled cog rather than a management-controlled cog, but they are still being treated like a cog.

Antoin --

Re: "the gas laws and the labour markets". The reasoning you were presenting reminded me very much of other discussions I've had in which unions are seen as corruptions of the purity of the free market. Not understanding the limited applicability of their model, they generalize way beyond the evidence and say things not unlike what you were saying. Perhaps your reasoning proceeds along different lines, and I've overgeneralized; if so, my bad.

Unions won't work currently in any software company I'm aware of because those who might profitably unionize still mostly see themselves as bound for the corner office. So I agree that the whole idea is unworkable as things now stand. Trouble is, whether they know it or not, software workers are being commoditized out of their jobs. You, Antoin, may not be saying this, but I find that the attitude prevails that "(shrug) Well, it's an unpleasant situation if you're in that line of work, but The Market has spoken, and only a fool would question its wisdom." As if markets were a direct consequence of String Theory, rather than human institutions subject to human control.

As to unions being inherently unsuited to work that is "no longer about making motions or following instructions - [but] increasingly about taking responsibility," you and I might disagree as to whether there's something inherent in "this type of work" that requires workers to be conned into thinking there's a corner office in their future, but that con does still seem to be working. But, the Long Boom having busted, there obviously aren't going to be enough corner offices to go around for all the people whose jobs are offshored.


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