Essentials of Economic Theory / As Applied to Modern Problems of Industry and Public Policy

by John Bates Clark

Restrictions on the Number of Members in a Trade Union.—If a trade union were altogether a private organization, it might properly control the number of its own members. Before it is formed all members of the craft it represents are, of course, non-union workers, and the aim of the founders is to "unionize the trade"—that is, to enlist, in the membership of the body, as large a proportion as is possible of the men already working in the subgroup which the union represents. From that time on it can fix its own standard of admission, and allow its membership to increase slowly or rapidly as its interests may seem to dictate.

How a too Narrow Policy defeats its Own End.—Very narrow restrictions, while they keep men out of the union, attract them to the trade itself. An extreme scarcity of union labor and the high pay it signifies causes the establishment of new mills or shops run altogether by non-union men. If these mills and shops are successful, the union may later admit their employees to membership; and a series of successful efforts to produce goods by the aid of unorganized labor thus interferes with the exclusive policy of unions. The number of their members grows in spite of efforts to the contrary.

Free Admission to a Trade Equivalent to Free Admission to a Union.—We may recognize as one of the principles in the case that free admission to the craft itself involves free admission to the union. When once men are successfully practicing the trade, the union is eager to include them, though it enlarges its own membership by the process.

How a Government might prevent a Monopoly of Labor.—It is entirely possible that a government might require trade unions to incorporate themselves, and might include in the charter a clause requiring the free admission of qualified members, subject only to such dues as the reasonable needs of the union might require. That is not an immediate probability, but the end in view can be attained by making membership in the trade itself practically free—which means protecting from violence the men who practice it without joining the union. This is not difficult where a mill in an isolated place is run altogether by independent labor, and it is natural that the unions should endeavor, in other ways than the crudely illegal ones, to prevent the successful running of such mills. If they run with success, their employees will have to be attracted into the unions. A measure designed to impede the running of non-union mills is the boycott. It is a measure which does not involve force and which is yet of not a little value to workers.

The Nature and Varieties of the Boycott.—A boycott is a concurrent refusal to use or handle certain articles. In its original or negative form, the boycott enjoins upon workers that they shall let certain specified articles alone. If they are completed goods, they must not buy them for consumption; and if they are raw materials, or goods in the making, they must not do any work upon them or upon any product into which they enter. They may thus boycott the mantels of a dwelling house and refuse to put them in position, or, in case they have been put in position by other workmen, they may, as an extreme measure, refuse to do further work on the house until they are taken out. A producers' boycott, such as this, falls in quite a different category from the direct consumers' boycott, or the refusal to use a completed article. When a raw material is put under the ban, workers strike if an employer insists on using it. If the cause of the boycott is some disagreement between the maker of the raw material and his workmen, the measure amounts to the threat of a sympathetic strike in aid of the aggrieved workers. If the cause is the fact that the materials were made in a non-union shop, the men who thus made them have no grievance, but the union in the trade to which these men belong has one. It consists in the mere fact that the non-union men are working at the trade at all and that their employer is finding a market for their product. Workers in other trades are called on to aid this union by a sympathetic strike, either threatened or actually put into effect. Such a boycott as this may therefore be described as amounting to a potential or actual sympathetic strike somewhat strategically planned. If the strike actually comes, it may assist the men in whose cause it is undertaken; and the principles which govern such a boycott are those which govern strikes of the sympathetic kind.

Direct Consumers' Boycotts economically Legitimate.—The other type of boycott is a concurrent refusal to buy and use certain consumers' goods. Legally it has been treated as a conspiracy to injure a business, but the prohibition has lost its effectiveness, as legal requirements generally do when they are not in harmony with economic principles. Of late there has been little disposition to enforce the law against boycotting, and none whatever to enforce the law when the boycott carries its point by taking a positive instead of a negative form. The trade-label movement enjoins on men to bestow their patronage altogether on employers included within a certain list, and this involves withdrawing it from others; but the terms of the actual agreement between the workers involve the direct bestowing of a benefit and only inferentially the inflicting of an injury. The men do not, in terms, conspire to injure a particular person's business, but do band themselves together to help certain other persons' business. Economic theory has little use for this technical distinction. It is favorable rather than otherwise to every sort of direct consumers' boycott, and is particularly favorable to the trade-label movement. This movement may powerfully assist workers in obtaining normal rates of pay, and it will not help them to get much more.

The Ground of the Legitimacy of the Boycott.—An individual has a right to bestow his patronage where he pleases, and it is essential to the action of economic law that he should freely use this right. The whole fabric of economic society, the action of demand and supply, the laws of price, wages, etc., rest on this basis. Modern conditions require that large bodies of individuals should be able concurrently to exercise a similar right,—that organized labor should bestow its collective patronage where it wishes. This can be done, of course, only by controlling individual members, for the trade union does not buy consumers' goods collectively. If it can thus control its members, it can use in promoting its cause the extensive patronage at its disposal.

Unfavorable Features of the Indirect Boycott.—The boycott we have thus far had in view is a direct confining of union laborers' patronage to union-made goods. Why this is a thing to be encouraged we shall presently see. What we have said in favor of it does not apply to boycotting merchants on all their traffic because they deal in certain goods. If a brand of soap is proscribed, the workers are justified in concurrently refusing to use that variety; but it is not equally legitimate to prevent a merchant, whose function it is to serve the public, from selling this soap to the customers who want it. To refuse to buy anything whatsoever from a merchant because he keeps in his stock a prohibited article, and sells it to a different set of customers, is interfering, in an unwarranted way, with the freedom of the merchant and of the other customers. Indirect consumers' boycotts have little to commend them, but those of the direct kind have very much.

The Merits of the Trade-label Movement.—This appears most clearly in connection with the trade-label movement. As a result of this movement union laborers will, as is hoped, buy only union-made goods. The existence of such a movement in itself implies that there are goods of the same sort to be had which are not made by union labor. The shop that is run by the aid of independent labor is the cause of the existence of the union label. If all the labor in a group were organized, the label would have no significance. At present the trade unions offer to an employer a certain amount of patronage as a return for limiting himself to union men, and so long as the cost of making his goods is not much increased, the inducement may be sufficient to make him do it.

The Movement as affected by Extravagant Demands on Employers.—Unduly high wages mean, of course, unduly high prices. Without here taking account of the "ca'-canny" policy, which aims to make labor inefficient, extravagant wages for efficient labor increase the cost of goods. This opens the way, as we have seen, for the free shop and the labor which is willing to sell its product at a cheaper rate. If union labor then firmly resolves to buy only the goods with the label, it proposes a heroic measure of self-taxation.