I recently said that America "would become France" if a certain bill now in Congress -- which would virtually guarantee that every company becomes unionized -- ever became law. Deceptively named the Employee Free Choice Act, this bill would in most cases take away an employee's right to a secret ballot in a union election and give unions the option to have federal arbitrators set the wages, benefits, hours and all other terms and conditions of employment.
Countries other than France have suffered the consequences of bad labor laws. When I was CEO of Handy Dan, the precursor to Home Depot, I traveled to England in the 1970s to take a look at a chain of stores we were considering for acquisition. When I arrived in London, the airport workers, bus drivers and garbage collectors were all on strike. The major shareholder of the company asked me to interview three employees. He informed me afterward that he wanted me to hire them at Handy Dan "because the U.K. was finished." He explained that his tax rate was 75% and there were no incentives to grow.
When I asked what he and his company were doing about it, he told me that the media would attack the company if it got involved politically. I jumped all over him and the company's CEO for letting this happen without a fight. Needless to say, Handy Dan did not buy these stores. Fortunately for Britain and thanks to the courage of Margaret Thatcher, both tax rates and the power of labor unions were reduced in later years.
My advice today about the Employee Free Choice Act is the same as I gave in England: You better fight to stop this undemocratic bill: hire a labor lawyer and have current labor laws protected. I'm not the only one who thinks the proposed law violates long-established principles of democracy. In these pages, George McGovern, a former Democratic senator and a champion of organized labor, called this bill what it really is -- "a disturbing and undemocratic overreach not in the interest of either management or labor."
To my astonishment, most CEOs in America are unaware of this planned hostile takeover of their human resources. I am retired, so this is not business for me. It's strictly personal. I care deeply about the competitiveness of American companies and our system of free enterprise.
I know that labor-union contributions are the lifeblood of many in the House and Senate. But I just cannot understand how so many in Congress are willing to sell out America for political dollars. When the bill came up for a key vote in 2007, all Senate Democrats voted yes and only two Democrats in the House had the courage to vote no. While the bill passed the House, it failed in the Senate because the Democrats were unable to get the required 60 votes to stop a Republican filibuster.
If the Democrats have a good November, the measure could become law early next year. Bill co-sponsor Barack Obama has said: "We will pass the Employee Free Choice Act. It's not a matter of if, it's a matter of when. We may have to wait for the next president to sign it, but we will get this thing done."
Those who support the bill claim that it will "protect workers." This doesn't pass the straight-face test. Mr. McGovern saw through the false rhetoric of the bill's sponsors, saying that the measure "runs counter to ideals that were once at the core of the labor movement. Instead of providing a voice for the unheard, [it] risks silencing those who would speak."
It's time to stand up and fight. America's competitiveness, jobs and right to a secret ballot are at stake. CEOs, and employees who want to keep their jobs in America -- and those retirees like me who would not be where we are today but for our system of free enterprise -- must stop this anti-democratic legislation.
By: Bernie Marcus
Wall Street Journal; August 26, 2008
