Is there any defense for Wal-mart?

The retail giant has lots of ferocious enemies, but economics prof Steve Horwitz defends it here.

The issue I find most interesting is unionization. Horwitz writes that this issue raises some questions for libertarians because it implicates right to work laws. I don’t agree. The issue has nothing to do with state laws against compulsory unionism. The issue is whether a company should be free to decline to negotiate with a third party over its labor contracts.

Suppose for the sake of argument that Small-mart’s management decided that it would only negotiate with a particular union over labor relations. Therefore, all the workers were presented with this choice: if you want to work here, you join the ABC Union and pay its dues; if you won’t do that, look for work elsewhere. Would that violate anyone’s rights? Certainly not. If that is how Small-mart wants to operate, fine. Prospective employees who don’t want to join the union can look for other employment. Government coercion against the company because of its desire to operate this way would be inappropriate.

Now turn it around. Small-mart’s management is opposed to negotiating with any third party, and tells prospective employees that the company will not negotiate with any union, even if they should all say they want such representation. Workers who want union representation and won’t agree not to seek unionization are free to look elsewhere for a job. Again, no government coercion is appropriate owing to the company’s choice to handle labor relations without any third party.

One comment

  1. I kinda agree….

    As someone who considers themselves generally libertarian, I find his “objections that libertarians have” a somewhat odd list. I honestly have very little problem with Wal-Mart at all.

    1) The “The company has indeed taken advantage of eminent domain or other government subsidies to get favorable locations or other benefits. ” argument?

    Well – I dont really blame a company for “not” putting itself at a competitive disadvantage on purpose….that’d be nuts. :) All I expect from Wal-Mart, or any company, is to play the game legally, with the tools and parameters they have available. If a town is going to toss special breaks and incentives and deals at a company…. I blame the town and government that’s abusing their position and taxpayer money…. not the company that legally takes the benefit offered. If the government is being foolish and stupid and handing out money… that’s not on Wal-Mart.

    2) The ” Walmart has also engaged in activities that threaten the presumed right of their employees to freely associate in unions. ” anti-union argument?

    I very much agree with your position and explanation…. “that” is how it’s supposed to work, with maximizing freedom all around. Using force to dictate the decisions companies or employees “must” take is the real abuse. I have no problem with voluntary cooperation, but I stress “voluntary” :)

    I dont know what he means about libertarian complaints regarding ” the acceptability of work contracts that explicitly deny the worker a right to unionize. ” Like pretty much any contract, the parties need to agree to the terms… if they dont, then no contract, just as you outlined….My problem with unions isnt so much the “union” itself… it’s the government mandate that private employers “must” engage them.

    3) Wal-Mart and the minimum wage?

    I can understand their support for it. First – I see it as a smart PR-move to not alienate people, particularly customers. They dont have to give up much to say some touchy-feely stuff some people like. Second – the reasoning Mr. Horowitz suggests also makes sense, and I kind agree on the same grounds as item #1… I can oppose crony capitalism, but I cant really blame companies for taking advantage of it when they legally can. I blame the government for allowing such influence to be available.

    Also – as someone who disapproves of the minimum wage in general, for most all the standard reasons…. I have no problem with how Wal-Mart pays it’s employees.

    I really was pretty unaware of any widepsread libertarian-oriented criticism of Wal-Mart. If these arguments here are the basic idea…. well, I guess this might be where I differ with my fellow libertarians then *shrug* Sure it isnt the first time, nor the last :)

    Anyway, interesting piece, thanks for sharing it :)

    Comment by Atnor on December 5, 2013 at 11:17 pm

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