Unions and Minimum Wage Laws

Why do unions promote increases in minimum wages? There are numerous articles explaining the reasons; such as the Wall Street Journal, the Mises Institute, and the Heritage Foundation. Also, several of our earlier posts have additional information. However, it’s fair to say that union members versus union leaders may very well have different motivations.

Union members are often hard-working folks, just struggling to make ends meet. They experience on a first-hand basis what it’s like to make hard choices between financial needs and wants. Most of them would not be comfortable knowing that their actions are harmful to other working people. So when they promote minimum wage laws, they believe they are helping ease the plight of low-wage workers. Yet they are not privy to all the motivations known to union bosses. Members typically trust their leaders, but they are being used.

Union leaders, have a different perspective. They are not only concerned about helping union members, but also about strengthening their own grip on the reigns of power. In fact, this motivation typically overrides all others. In order to strengthen the union, while securing their own position, they must foster an atmosphere of distrust and drive a wedge between employers and employees. Only in this way can they control what the union members hear and believe. The union members are only useful as troops if they can be controlled, and this requires controlling the message. So the union leaders don’t tell their members that promoting minimum wage laws harms other people. Instead they tell them that by helping the low-wage workers get higher pay, their own salaries will increase also. So they think they are helping both classes of workers, but they haven’t been told the whole story.

What’s hidden is the consequences of eliminating entry-level jobs and why it is so devastating for the poor. The difference between gaining credibility for work through education or experience is described elsewhere. The crucial point to understand is education of any type comes at a price and the price for gaining the education needed for career advancement is ALWAYS working for a period of time at a lower wage. So when unions campaign for higher minimum wages, they are really eliminating some entry-level jobs and forbidding some people from gaining the education needed for getting out of poverty. If the union workers truly understood this many of them would not participate in campaigning for higher minimum wages. That’s precisely why union bosses don’t tell them the full story.