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Thursday, February 24, 2011

Card Check Without Congress

In 2009 I made a bet with fellow Freeman columnist David R. Henderson that before the Obama presidency expires, Congress would enact substantial freedom-reducing changes—such as card check—to American union law. David, ever the optimist, didn’t think so. Inasmuch as Speaker Nancy Pelosi is just a bad memory from a horrible dream, and it is now very difficult for Obama and his allies to break filibusters in the Senate, it seems that David will win our bet when Obama leaves office in January 2013. (I can be an optimist, too.)

The 112th Congress is not likely to enact the sort of changes to American union law preferred by the bosses of the Service Employees International Union (SEIU), but Obama is very likely to try to do so through administrative and executive fiat. As Shelby Steele says, Obama’s “policymaking has been grandiose, thoughtless and bullying.” Two non-union examples (mine not Steele’s): Obama, when faced by Senate opposition to his grandiose cap-and-tax war against carbon, deliberately went around Congress to his thoughtlessly green appointees in the EPA to attack carbon through administrative fiat. Again, when faced by two court decisions that told him he could not shut down offshore oil drilling in the Gulf of Mexico, he deliberately went around the court decisions to his EPA and his Interior Department effectively to prevent drilling by holding up the permitting process.

The five-member National Labor Relations Board (NLRB) is appointed by the president, with concurrence of the Senate, to five-year terms. At this writing there are only four members. Three of them—Wilma Liebman, Brian Hayes, and Mark Pearce—are serving Senate-approved terms. Liebman, the chairman of the Board, is a former union lawyer with a long record of serving the interests of unions. Her term expires August 27. Obama may reappoint her, but the new Senate may not go along. While in private practice Hayes represented management interests in labor disputes. His term expires in 2015. In private practice Pearce represented union interests in labor disputes. His term also expires in 2015.

Becker Versus Workers

The other member, Craig Becker, was never approved by the Senate. He is on the Board because in 2010 Obama used his recess appointment power to get around Senate confirmation. He may have to do the same to keep Liebman on the Board when her term expires. Becker is unique in his pro-union, anti-worker sympathies. As I will show below, he is an Obama kind of guy. While a package deal between Obama and sufficient Senate Republicans involving Liebman and a Republican appointee to fill the fifth seat may be put together, there is no way Becker can avoid a Senate filibuster against his appointment to a regular term.

Right now there are three reliably pro-union votes on the NLRB. They can do what they want in each case that comes before them. The imminent danger to worker freedom is best understood by examining the views of the most articulate and forceful of the three—Becker. When he was appointed, Becker was associate general counsel to the SEIU. Earlier, as a professor of law, he published many articles in scholarly journals in which he promulgated his pro-union vision.

He doesn’t think any worker should be allowed to be union-free. In his own words, “Just as U.S. citizens cannot opt against having a congressman, workers should not be able to choose against having a union as their monopoly-bargaining agent.” Apart from the obvious rejoinder that unions are not governments, Becker, like Obama, doesn’t believe in the consent of the governed. They are Mountaintop people—that is, elitists.

In a 1993 article in the University of Minnesota Law Review, Becker argued that existing union law can and should be interpreted to strip employers of any “legally cognizable interest” in the process by which their employees unionize. When faced with aggression, employers should be forced not to resist. Just after Obama’s inauguration, Becker composed executive orders that the President then imposed on workers and employers. For example, if a union-impaired federal contractor supplying services to the federal government loses a contract to a union-free firm, the latter must extend preferential hiring offers to the unionized workers of the former and recognize and bargain with the unions representing those workers.

Reversing Course

Last August 27, Becker, Liebman, and Pearce voted to reconsider two earlier NLRB cases that displeased union bosses. Existing law allows, but does not compel, an employer to turn his employees over to monopoly-bargaining unions on the basis of card check. In Dana Corp. (2007), the NLRB said that such workers had 45 days to request an election to void a card-check recognition. MV Transportation (2002) addressed the following: Suppose firm A is unionized and has to go out of business because it cannot effectively compete. Union-free Firm B buys A’s assets and hires workers, a majority of whom are former, unionized employees of A. Does Firm B have to recognize those workers’ union as a monopoly-bargaining agent for all of B’s employees? In 2002 the NLRB said that workers themselves should decide the question by an election.

In both cases the NLRB decided that a secret-ballot election, not administrative fiat, should determine the fate of workers. Now a majority of the Board wants to “reconsider” whether the two cases were correctly decided. It appears that Liebman and Pearce want to join Becker and Obama on the Mountaintop. When this NLRB reopens these two cases it is likely to reverse both, and those reversals will be the first steps on the road to compulsory private-sector card check without Congress. I have no doubt that Becker and the others will try to take the whole trip.

As voters across the country gave us the new Congress, voters in Arizona (Prop. 113), South Carolina (Amendment 2), South Dakota (Amendment K), and Utah (Amendment A) adopted amendments to their respective state constitutions that prohibit compulsory card check whether imposed by Congress or from the Mountaintop. States control the rules of unionism as they pertain to their state and local government employees, so these newly adopted amendments will protect those employees from card check. However, the National Labor Relations Act (NLRA) sets the rules for private-sector workers, and my guess is that federal courts will decide federal law preempts state law on card check.

In sum, David wins the bet, but workers are still exposed to the tyranny of the Mountaintop. The short-run consolation for workers who want to become and remain union-free is that a future NLRB can reverse what the existing Board does. The better, long-run, solution is the permanent repeal of the NLRA in favor of genuinely voluntary unionism.

  • Charles Baird is a professor of economics emeritus at California State University at East Bay.

    He specializes in the law and economics of labor relations, a subject on which he has published several articles in refereed journals and numerous shorter pieces with FEE.