The high road to coercion: public goods and forced unionism

There is a striking parallel between the argument in favor of forcing people to contribute to public goods and forced unionism. In both cases, it is argued that only forced contributions will ensure that people who benefit from public goods and collective bargaining pay their “fair share.” Of course, this argument simply assumes that all people who are forced to contribute to the government and labor unions want and appreciate those benefits – which is simply incorrect.

Since it is perceived too costly and impractical to distinguish between sincere opponents and free riders, this distinction is lost in practical politics and labor disputes. In reality, tax payers and employees of unionized organizations are simply treated as “blocks of people” where objections of individuals do not really matter. To sweep individual consent so easily under the carpet is one of the defining characteristics of governments and labor unions.

In his seminal work on private provision of public goods, Social Contract, Free Ride, Anthony de Jasay writes:

“The high road to coercion is the contractarian pretension that acceptance by a person of a share in a benefit he did not solicit is tantamount to his tacit acceptance of an obligation to provide a share of the corresponding contribution in the same way as those who did solicit the benefit.”

In this book Jasay also argues quite persuasively that the prohibition on free riding that is sought in collective good arguments will be undermined by the fact that governments  in turn generate the most formidable opportunities for free riding and parasitism by allowing voters to enrich themselves at the expense of (other) taxpayers.

Advocates of collective bargaining for public sector unions claim that collective bargaining is a “right” or “human right.” It is not clear what is being meant by “right” in this context because one cannot claim a right of this nature without assuming a corresponding obligation of others (companies, governments) to negotiate with you. In the case of public sector labor unions the nature of this presumed right is even more contestable because government employees are not bargaining for a share of the profits of a private company but for taxpayer money. Public sector union members  basically expect taxpayers to refrain from efforts to protect their own money and freedom of choice so that government employees can enjoy more generous compensation and benefits.

There is an ongoing debate about the question of whether public employees are overpaid or underpaid. Compensation in the private sector is, absent government intervention, governed by supply and demand. Compensation in the public sector is governed by supply and demand and majority rule. The role of coercion in paying government employees simply excludes a rigorous test of what these employees are worth to the taxpayer. Education is also a poor proxy for compensation of public employees because, as the growing education bubble makes clear, companies that are operating in a competitive environment are not going to pay an employee for their educational degrees as such. That governments do often pay high salaries to people with degrees that are not held in high esteem in the private sector reinforces the unhealthy relationship between publicly-funded education and government.