A group of enterprising reporters at the Las Vegas Sun published a very lengthy article on EFCA over the weekend. They get one thing right: “Although rarely discussed in the presidential campaign, the new law could be the most consequential — and radical — social and economic policy shift since President Reagan reshaped the country” The rest of the story lays out a key labor talking point that we will surely hear next year when Congress returns – let’s call it the “card check success story.” The narrative goes like this: Las Vegas casinos had card check twenty years ago. Unions organized just about every property. The casinos boomed. The workers paychecks were hefty. Steve Wynn’s paycheck was even heftier. Everybody made out on the deal. Is card check really such a bad thing? But, is it wise to export the Vegas everywhere? Let’s consider a few factors: 1.) Vegas just experienced a terrific economic explosion. Yet, all good things come to an end and there is ample evidence that the Vegas party is over. The city has the worst housing market in the country, casino stocks are way down, and there are way too many hotel rooms being built for what is going to be reduced demand. Add on top of that increased competition from Indian casinos as well as Macau and the entire economic picture in Sin City is coming up snake eyes. Going back to card check, having a massively unionized workforce usually isn’t a bad thing during boom times. But during bust times, it can be dicey. There are a long line of companies that promised unions the world when things were going well, only to realize that those promises were foolish when things went south. So, before we declare card check a success in Vegas, maybe we should wait a few years. 2.) The article correctly notes that Steve Wynn accepted card check at his properties. What Wynn made was a business decision. There is a strong argument that the business decision is immoral, unfair to workers who are forced to join a union, etc. But, at least, the person who was impacted by card check – Wynn in this case – agreed to it. That’s the way the current law operates. What makes EFCA so radical is that we will now force this on business owners through government policy – it doesn’t matter if this is in the best interest of your business or not. You’re stuck with it. Of course, the side effect of such a policy is that it can discourage the next generation of Steve Wynn’s. Vegas’s boom is precisely because Steve Wynn and others engaged in economic risk-taking – a key element of this risk-taking is the ability to make business decisions, especially with regards to human resources. Taking this decision away from businesses and sensible labor law provisions and replacing it with EFCA can discourage the very same economic risk-taking that has made Vegas a success to start.
