Why Your Packages May Soon Cost Twice As Much

For the past several months, FedEx and United Parcel Service (UPS) have been in an intense legal battle that could shake the entire shipping industry. FedEx, because it ships the majority of its packages via air, is governed under different unionization rules than UPS, which ships the majority of its packages via trucking. As a result, FedEx's labor must have a majority of all its employees voting in favor of organizing in order to unionize, while UPS' labor need only get a majority of the employees who actually vote.

UPS' costs in worker compensation are now over twice those of FedEx.

UPS and the Teamsters are now lobbying Congress to reorganize federal labor laws in a way that will bring more of FedEx's workers into the same designation as UPS' workers and therefore, bring all of FedEx under new labor regulations.

The exorbitant costs that the unionization in UPS has brought are no surprise; for decades unions have exerted enormous power over business and government, lobbying for power, more power. Yet some misunderstand the unions' problems as problems of existence. "If we could just get rid of the unions," they reason, "we could get back down to business again." This, however, ignores the basic reason of why the unions have gained so much power in recent years. In the Industrial Revolution, when unions were just starting to pick up steam, businesses used their political clout to gain benefits from the Federal Government in the area of labor management (case in point: when President Hayes sent federal troops in to put the kibosh on the workers participating in the Great Railroad Strike of 1877). The situation between labor, government, and business was like this:

LABOR --- GOVERNMENT == BUSINESS

In response to the overwhelming power of the alliance between business and government, labor unions began to realize the power of lobbying for themselves and soon, various groups of both labor and big business were vying for government handouts and favorable regulations.

LABOR == GOVERNMENT == BUSINESS

In time, particularly as the Progressive Era of Teddy Roosevelt, Woodrow Wilson, and later FDR gained power, business still received favorable government action such as subsidies and competition-squashing regulations, but lost much of its power in the area of organized labor. Meanwhile, unions gained more and more political power as the Great Depression provided a pretext for the increasing of labor power. This situation has continued to the present day, with this relationship between labor, government, and business:

LABOR == GOVERNMENT --- BUSINESS

Unions can now use the coercive authority of government to force employers into deals that hurt business, consumers, and indeed, non-union workers. As a result, products and services cost far more than they should and these costs are either passed on to consumers or kept within the company until the company fails. Now the economy is in no better a situation than it was when employers held the power to take away workers' rights by using the government as a weapon.

The appropriate solution is one in which government stays out of the dealings between businesses and their workers. Freedom of association is the ideal situation, in which workers can stay in their job if they wish, but also have the liberty to leave if their employer is giving them unfavorable conditions.

LABOR == BUSINESS

Simply abolishing unions and other forms of organized labor will not solve the problems currently faced by employees and their workers. Doing so would simply be a return to the old days in which businesses held complete control over their employees and the working class suffered. Instead, one should look to the root of the problems in modern industry, which is an overbearing, intervening government that has given itself the role of mediator between business and workers, a mediator that nobody wants.