The requirements that companies only follow union rules to accomplish a task are the “ropes” by which unions will hang themselves. Excessive costs due to union rules can cause a paradox effect that leads to innovations that eliminate the need for union workers.
Vladimir Lenin said, “The Capitalists will sell us the rope with which we will hang them.” The example below serves as a modern twist on that thinking:
A large Midwestern railway company’s expense for lighting its very large rail yard is astronomical. The monthly light expense includes the electric bill and maintenance. The maintenance main component is the labor cost of replacing bulbs. The cost of replacing a bulb includes the costs of the bulb (negligible expense) plus the cost of sending the maintenance crew out to do the job (big expense). By switching to LEDs, the railway company will save approximately 70% of the electric bill because LEDS light so much more energy-efficiently than old fashion bulbs. However, the bigger savings comes after the one-time cost of switching out the old bulbs to LEDs. Old sodium vapor lamps had a lifetime of up to 20,000 hours, and other lamps had even shorter lifetimes. The LEDs can have a lifetime in excess of 100,000 hours. As a result, the maintenance cost becomes approximately 20% of the prior costs (after the one-time cost of replacement estimated as the old two-month costs of maintenance).
Because labor cost to replace light bulbs is so expensive, making a one-time expensive capital payment for new LED lights instead of keeping recurring old, expensive work rules is preferred. These recurring, expensive work rules are the “rope” that will hang the unions.