Re: Wisconsin Republicans vote to strip public worker collective bargaining rights wi
To anyone who is interested, here's the mathematical, economic explanation for why it's a bad idea to allow teachers' unions. I've tried to keep it as simple as possible, but there are some economic graphs so if it's confusing, let me know.
Here we go: Imagine that there were no public unions, and the wages of teachers were allowed to rise and fall according to market forces. Under such a system, governments would naturally increase wages when there was a shortage of qualified teachers, and naturally decrease wages when there were lots of qualified teachers who couldn't find jobs. Here's how that would look on a supply/demand graph.
As you can see, the quantity of people willing to supply their labor (i.e. teachers) increases as the price of labor (i.e. salaries) increases. The quantity of labor that the market demands (i.e. taxpayers who need to hire teachers to fill the classrooms) DECREASES as the price of labor increases, because they can't hire as many people if each of them costs more. The point where the supply and demand lines intersect is called the "equilibrium price." This is the wage that teachers would naturally earn in a free market system.
Under such a system, who benefits? The teachers or the taxpayers? They both do, as this graph illustrates:
Why do they both benefit? Because even if the wage was lower than that, some teachers would still be willing to work. They benefit by earning a higher wage than they actually require in order to take the job. The amount that the teachers collectively benefit from such a system is the area of the yellow triangle. Conversely, even if the wage was higher than that, the taxpayers would still be willing to hire some teachers. They benefit by employing public servants who earn a lower wage than the taxpayers might be willing to spend. The amount that the taxpayers collectively benefit from such a system is the area of the blue triangle. The combined area of the yellow and blue triangles is the amount that society as a whole benefits. With me so far?
Now, what happens if we introduce a teachers' union into the graph? A teachers' union exists to try to negotiate an ABOVE-market wage for teachers. So let's assume that they're successful in doing so. What happens?
Under this system, the wage is artificially inflated above what the free market would naturally decide. This results in far more qualified teachers willing to supply their labor than there are schools willing to demand it. This causes unemployment, as the red arrow illustrates.
And who benefits from the union-negotiated wages? Well, the union succeeded in making teachers better off. As you can see, the yellow area (the amount that teachers benefit) is now slightly bigger than before. Unfortunately, the blue triangle (the amount that the taxpayers benefit) is substantially smaller than before. The taxpayers are the biggest losers. But that's not all - the overall benefit to society is actually smaller as a result of union-negotiated wages! See the gray area in the graph? That represents a deadweight loss. Neither the taxpayers NOR the teachers reap the benefits of it, and society as a whole loses out.
And all that extra unemployment among qualified teachers, that didn't exist before we introduced the union into the graph? That makes the students worse off.