"Somewhat the same situation is involved in the so-called right-to-work laws," he continued.
If they are passed in a large number of states, they will temporarily relieve the present uneconomic evils that exist in federal labor laws. They will allay the fear among those people who see and comprehend the dire results now flowing from present union activities." Actually, it might be both better economics and better expediency to let present laws go their limit, so that people might soon learn how bad they really are.
Greaves's prediction was accurate. Taft-Hartley passed, and talk about repealing Wagner ended. Over the years the National Labor Relations Board has managed labor relations unimpeded, often in outrageous ways.
"The so-called right-to-work laws are " a proposed middle-of-the-road compromise with free-market principles for expedient purposes," Greaves wrote. "They limit the right of free men to negotiate contracts for morally acceptable purposes and attempt to substitute the decisions of politicians for those that consumers would like to express in the market place."
Greaves's bottom line is that if Wagner is the root of the evil, one should work to repeal it rather than support new interventions. Short of that, in my view a better stopgap would have been to let states opt out of the Wagner regime. In other words, rather than prohibiting voluntary union-shop agreements between employers and unions, a state legislature could pass a bill simply declaring that the NLRB had no jurisdiction in that state. (See Gary Chartier's "What's Wrong with Right-to-Work.")
Greaves could imagine sound reasons for an employer wishing to sign a union-shop agreement:
The fact that many current labor union practices are injurious to the general welfare does not mean that all actions of all labor unions must of necessity be considered evil or uneconomic. There are many truly economic functions that labor unions can perform. In a free and moral society, unions would be solely voluntary groups organized to help their members by helping them to increase their production and thereby their contributions to society. Their chief purpose would be to raise the standards of workmanship and production. They would then be a force for the general economic good of society as well as their members.
Here he echoes the views of Henry Hazlitt. Thus for Greaves,
If we can visualize such a situation, we will then be better able to understand why employers should be free to sign contracts to hire only such high type workers and why the so-called right-to-work laws would interfere with the main objective of social cooperation -- the increased satisfactions of all the individual participants in the market.
Pervasiveness of Corporatism
To be sure, Greaves's analysis has serious deficiencies, particularly regarding the pervasiveness of corporatism. In opposing legal privileges for unions, he stated that "most employers have been stripped of the privileges they had legally obtained during the latter part of the last century." This clearly was not the case. Big business continues to have myriad explicit and implicit privileges that would be unattainable in a freed market, as well as enduring benefits of earlier privileges.
But to his great credit, Greaves noted that it was government intervention on behalf of capitalists that "produced the demand" for countervailing pro-labor privileges: "Most such intervention was planned to help organized "labor' and the other large groups that had suffered when employers were in the saddle and obtaining favorable intervention for themselves" (emphasis added).
This insight putting the horse before the cart sets Greaves apart from many libertarian analysts. (On at least one occasion, Grover Cleveland thought similarly, even if it was not reflected in his actions.)
What Greaves and others overlooked (and continue to overlook), however, is that much of the business elite had long pushed for Wagner-style labor laws for the sake of industrial peace. The last thing they wanted was laissez-faire for labor organizers. The New Deal, rather than being anti-business and pro-labor, actually tamed labor by bringing "responsible" union leaders to the conference table as junior partners. The Wagner-Taft-Hartley regime imposed restrictions on labor activity and required labor leaders to police their members' compliance with union contracts. The final Wagner Act had elements that big business disliked, but it was the business elite nonetheless that laid the groundwork for federal management of labor relations.
Radical labor activists, such as those in the Industrial Workers of the World, the Wobblies, wanted no part of labor law because it imposed rules on what they could do to get a better deal from employers. Older tactics, such as wildcat strikes, secondary boycotts, and sympathy strikes along the supply chain, were outlawed in the new labor regime. Cooling-off periods, compulsory arbitration, and other constraints were imposed. It's enough to make one wonder if employers would really want Wagner repealed.