Tuesday, December 20, 2005

The New York City transit union strike

As many of you have probably heard, the NYC transit unions went on strike shortly this morning. They turned the city into the great Manhattan walkathon.

Actually, I was surprised there weren't more people on the sidewalks. I decided to walk from Grand Central to work, figuring that taxis would be in such high demand that by the time I got one, it would have been faster to walk. It was rather cold, in the low 20s at the approach of the 9 o'clock hour, but fortunately I work right in midtown, between Rockefeller Center and Central Park. I was further surprised to see a woman in a knee-length skirt and similarly long winter coat. If you all will pardon this bit of chauvinism, she did have exceptionally lovely legs and no doubt likes to show them, but it was pretty cold.

Cabs normally turn on 43rd or 44th Street to go south on Vanderbilt so they can drop off passengers at Grand Central and pick up new ones. But there was a police cruiser blocking the intersection of 44th and Vanderbilt, and though I didn't stop to get a clear look, probably a similar barricade on 43rd. Why, NYPD? It forced people to walk over to 5th Avenue and hope for a cab, instead of forming an orderly queue along Vanderbilt to wait for cabs.

As I found out at work, it's just as well I started walking right away. Cabs and livery cars (the latter normally can't be flagged down but have been given permission to pick up unscheduled passengers during the strike) were charging double rates, which isn't worth it to me. However, there is an economics lesson here: we're seeing the allocation of a somewhat scarce resource in suddenly surging demand. Prices are the best system to determine which people get their share of the resource. If my normal $5 cab ride to work (about 10-15 minutes depending on city traffic) becomes $10, I personally would rather stretch my legs, even in sub-freezing temperatures, when it's only a 15-20 minute walk.

On the other hand, if I can pay the normal rate of $5, then I'm consuming a resource that someone might be willing to pay $10 to have. He might be willing to pay $20 because his time is that much more valuable. Also, everyone will be competing for the resource on the basis of pure luck in finding it, so society as a whole will incur high search costs (which I've written about in relation to oil). Even if it's only time, that's a very real cost. That's time people could have spent at work, or even enjoying themselves. Fortunately I was lucky and decided immediately I'd better just walk.

The latest news is that a state judge has fined the union $1 million per day. That's not much, really. The transit union has about 33,000 workers, so that's only $30 per employee per day. The real fine is under the Taylor Law: two days' pay for every day on strike.

I still say, like I said last Wednesday morning when the strike was looming, fire the workers. If they don't want to work, that's great. They have the right to refuse to work. And their employer should have the right to refuse to continue employing people who won't show up to their jobs. But again, governments stupidly surrender so much to unions, caving in to this perpetual myth that certain jobs must be unionized.

They don't have to be, and this transit strike proves they shouldn't be. It's time New York City set an example for the nation. It's time for Bloomberg to tell the transit union to take a hike, and deal similarly with other unions that threaten to hold a municipality hostage.


Blogger TKC said...

One could always slug to work.

Tuesday, December 20, 2005 5:16:00 PM  
Blogger Mike said...

Like I told my dad, Bloomberg just needs to go Reagan on their ass.

Tuesday, December 20, 2005 8:42:00 PM  
Blogger Perry Eidelbus said...

And the beauty of it is that Bloomberg has the authority Reagan didn't.

Tuesday, December 20, 2005 8:59:00 PM  

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