Who Are the Freeloaders?

This week Michigan became the 24th right-to-work state, although to hear the uproar you would think something unprecedented was going on. There are more than enough commentators to debate the effects on Michigan’s economy and politics, but not too many ready to discuss what it will mean for Michigan unions internally.

First, let’s not overestimate the effect, particularly when it comes to teachers’ unions. Alabama, Florida, Nevada and Idaho all have effective unions despite right-to-work laws. The biggest direct change is the inability to collect dues or agency fees from those in the bargaining unit who don’t want to pay.

There is a lot of misleading rhetoric about agency fees, illustrated by Michigan Education Association president Steve Cook, who said last week, “No one is forced to join a union – that’s already illegal. This allows workers to get out of paying their fair share of what it costs to negotiate the contract they benefit from. Whether proponents call this ‘right-to-work’ or ‘freedom-to-work’, it’s really just ‘Freedom to Freeload.’”

Leaving aside the question of those who may not benefit from a contract they are forced to pay for – math and science teachers, low-seniority teachers, high-performing teachers, teachers who might want a different insurance provider – unions are required by law to represent everyone in a bargaining unit, regardless of membership status, because they insist on it. The very first thing any new union wants is exclusivity. No other unions are allowed to negotiate on behalf of people in the bargaining unit. Unit members cannot hire their own agent, nor can they represent themselves. Making people pay for services they neither asked for nor want is a “privilege” we reserve for government, not for private organizations. Unions are freeloading on those additional dues.

And it is mostly dues. Though we hear a lot of squawking about agency fees, the fact of the matter is that they account for only a very small percentage of union income. That’s because the high cost of agency fees persuades a typical employee to avoid the bad will and ostracism afforded to fee-payers. They simply join the union instead and pay the full amount – including, of course, the percentage that goes to political causes.

The “freeload” crack is especially ironic coming from MEA, which ran an $11 million budget deficit in 2010-11 and is a cumulative $113 million in the red. In other words, the union has spent millions of dollars in dues it hasn’t collected yet, some of which will be paid by people who might not even be members yet. Who is freeloading?

Finally, you have to wonder about the value of claiming solidarity on behalf of all workers during protests in Lansing, while at the same time claiming that a large percentage of your membership will bail out and become freeloaders when given the chance. This may help explain why more than 88 percent of the American workforce somehow muddles along without a union.