Commentary

Special Interest Delivery System

This article appeared in Copley News Service.

The federal government was originally conceived as an institution with limited, enumerated powers. However, over time interest groups and politicians have vastly expanded federal powers.

Indeed, Congress has routinely conferred political status upon influential interest groups, such as labor, by creating their own Cabinet departments. Which has led to ever more government intervention— like the president’s attempt to end the strike against United Parcel Service.

It should come as no surprise that organized labor wanted its own agency. After all, business enjoys manifold subsidies from the Commerce Department, whose primary function is to enhance corporate profits. But even many firms today want the Labor Department to resolve other companies’ labor disputes. For instance, the Chamber of Commerce called on President Clinton to order the UPS employees back to work. Although the president declined to do so, he did pressure the parties to settle.

Moreover, he has no objection to using his power, having ended the earlier strike against American Airlines as it began. And he may have another opportunity to intervene when the UPS pilots’ contract expires this fall. The union is talking about a possible Christmas strike. One can imagine the pressure hysterical mail order companies would then place on the president.

Here, as elsewhere, government has metastasized beyond any appropriate role. Labor relations are a private matter. Government should only act as impartial arbiter, providing the judicial framework for adjudicating disputes and preventing violence. (The latter shouldn’t be controversial, but despite some 9,000 incidents by unions since 1975, the National Right to Work Committee faces an uphill struggle as it presses for passage of the Freedom from Union Violence Act, now before the Senate Judicial Committee.) Questions such as whether workers should be represented by a union, and what terms employees and employers agree on, should not be answered by government. Especially when the Labor Department is a political payoff to unions, not a dispassionate problem-solver.

The department has not, however limited itself to regulating employment relations. It grabbed an important piece of the welfare state—particularly job framing initiatives— when the War on Poverty and associated government crusades created new programs hither and yon.

Congress should take out its wrecking ball. Legislators could start with the agency’s employment programs which have, in the main, proved to be abject failures. Training should be left to workers and companies.

Unemployment insurance discourages not only work, but also private savings to cushion joblessness. Congress should abolish the federal program, leaving states to decide whether to create a substitute, experiment with different approaches, or dispense with the system altogether.

Congress should also roll back federal regulation of the labor market. The minimum wage destroys jobs, since it prices out of work anyone who lacks sufficient education, experience, and skills to earn the minimum. Were this not the case, the government could make everyone rich by imposing a minimum of $100 or $1,000 an hour. Similar in effect is the Davis-Bacon Act, winch requires payment of union scale wages for federally funded construction projects.

Restrictions on overtime and other work conditions are equally misguided. Different workers prefer different benefit packages. There is no reason for Washington to decide, say, the overtime pay rate. Nor should government promote labor unions any more than corporations. Especially when regulations purporting to help working people simultaneously interfere with their right to choose the benefits they prefer and unfairly penalize companies in order to boost organized labor.

However, Congress should enforce the 1988 US. Supreme Court decision, Communications Workers of America vs. Beck, which grants workers the right to a refund of any union dues used for political purposes. Today most labor unions flout the law, collecting dues with the implicit aid of the federal government for partisan use.

Congress should dismantle the Occupational Safety and Health Administration (OSHA). Despite imposing annual costs of as much as $34 billion (the agency’s nitpicking rules are legendary), there is no evidence OSHA has improved US. workplace safety. The rate of employee fatalities has been falling for six decades, and is affected more by workers’ compensation laws and tort litigation than by OSHA. Nor has there been much drop in workplace injuries.

Such tasks as collecting statistics and figuring the rate of inflation (Bureau of Labor Statistics), could be transferred to the Census Bureau. Oversight of private pensions (Pension Benefit Guarantee Corp.) could be shifted to the Treasury Department, with the agency stripped of its role as guarantor and focused instead on ensuring that private companies fulfill their contracts to past employees.

The Labor Department— a wasteful amalgam of special interest subsidies and officious government meddling, including intervening in strikes like that against UPS —should not exist. Congress should close the department before it interferes again.

Doug Bandow is a senior fellow at the Cato Institute.