The Economist

(Steven Felgate) #1

20 United States The EconomistJuly 21st 2018


2 labour union with 1.7m members. In the
run-up to the Janus decision unions asked
their members to pledge “I’m sticking with
my union” no matter what the court decid-
ed. Of the AFT’s 800000 members in
states affected by Janus 530000 had
signed such a commitment before the deci-
sion was released according to Ms Wein-
garten. Heavily Democratic states like
New York and California are also passing
laws to soften the blow by insisting that
unions are given contact information for
ne w workers and strictly limiting the time
period in which employees could revoke
their membership.

The Piketty line
Economistshave long debated the merit of
unions. Classical economists tend to see
them as localised monopolies on labour
which impose deadweight losses. A recent
interpretation of their effec t is more neu-
tral: unions may be a countervailing force
to monopsony or the market power that
firms have over wages and competition for
workers. For example until recently seven
large American fast-food chains held “no-
poach agreements” preventing their work-
er s from switching franchises. They were
dropped when state attorneys-general
threatened to sue. Across the OECD club of
mostly rich countries unionisation rates in
the private sector have steadily fallen. Pub-
lic-sector workers have been insulated
from this in part because governments are
not profit-maximising and in part because
teaching cannot be outsourced to China.
One unintended consequence of the
slow demise of American unions could be
worsening income inequality. Labour-
market researchers note that when union-
isation was at its zenith income inequality
was at it s nadir. A recent working paper by
Henry Farber Daniel Herbst Ilyana Ku-
ziemko and Suresh Naidu used a new data
set spanning the last 80 years to show that
this inverse correlation remains robust in
the face of attempts to control for changes
wrought by globalisation and technology.
Their research suggests a simple mecha-
nism for this association. Union members
have earned up to 20% more than similarly
qualified workers throughout this period.
During the halcyon days of unionisation
unskilled workers were more likely to be
members so this earnings boost helped to
hoist them into higher tax brackets and re-
duce inequality. As unions have shrunk
they have also shed low-skilled workers.
Smaller unions will spend less money
on politicking as they use their dwindling
resources to hold on to members and
stanch the flow of free-riders. That could
make school reform which teachers’ un-
ions have often blocked easier to pursue.
During the 2016 election cycle organised
labour spent $217m—88% of it going to
Democrats according to the Centre for Re-
sponsive Politics which keeps score. There

will also be fewer members to go out and
knock on doors. A clever study published
in January 2018 by James Feigenbaum
Alexander Hertel-Fernandez and Vanessa
Williamson measured the political conse-
quences of declining unionisation by look-
ing at counties bordering states that adopt-
ed right-to-work laws. The researchers
found that such laws not only reduced un-
ion contributions and get-out-the-vote ef-
forts as expected but they also depressed
the vote for Democratic presidential candi-
dates by 3.5 percentage points.
Electoral benefits help explain the zeal
for diminishing union clout. Unions al-
ready fear that th e expansive Janus opin-
ion could invite future legal challenges to
private-sector agency fees as well. When
pushing right-to-work laws Grover Nor-
quistan anti-tax activ istpredicted that if a
dozen more states adopted Wisconsin’s
model “the modern Democratic party will
cease to be a competitive power in Ameri-
can politics”. That is wishful thinking: par-
ties adapt; Democrats have already spent
decades reckoning with declining union
power. Yet unions have often had a moder-
ating influence on the Democratic Party
pulling it back to a focus on the economic
interests of workers when activists might
prefer to concentrate on guns abortion or
th e environment. The withering of unions
will remove that counterbalance. 7


N THE run-up to the attacks of September
11th 2001 said George Tenet the former
director of the CIA America’s intelligence
system was “blinking red”. On July 13th
Dan Coats the current director of national
intelligence invoked Mr Tenet’s language
to convey the magnitude of the threat
posed by foreign hackers. “The digital in-
frastructure that serves this country is liter-
ally under attack” he said. “The warning
lights are blinking red again.” Although Mr
Coats expressed concern about infiltration
from numerous countries he called Russia
“the most aggressive foreign actor”. Mean-
while the president seems indifferent
when it comes to the risk of Russian med-
dling with the mid-terms in November.
How vulnerable are American elections?
If Vladimir Putin’s hackers did seek to
intervene in the congressional elections in
November they would have two avenues.
One familiar after 2016 is to use social me-
dia and pretend news sites to spread disin-
formation or propaganda. It seems likely

that Russian intelligence agencieswill con-
tinue trying to bolster the Kremlin’s pre-
ferred candidates and hinder their rivals in
the court of online public opinion. In May
a Russian news agency with close ties to
Mr Putin’s government launched a “news”
website called USA Really which publish-
es a regular stream of articles favourable to
Mr Trump. The impact of such campaigns
is hard to measure: recent research on their
effec t in 2016 found that most people read-
ing such stuff already supported Mr Trump
(see Lexington). But the races for control of
both chambers of Congress now look close
enough that propaganda could prove deci-
sive even if it only sways a tiny sliver of the
The second more insidious method is
to complement that tactic with a more di-
rect cyber-attack on voting records or ma-
chines. Fortunately the spectre of hackers
in Moscow doctoring actual election re-
sults appears remote. Just before leaving
the White House Barack Obama designat-
ed election systems as critical infrastruc-
ture. That decision granted election offi-
cials access to federal cyber-security
experts and to an information-sharing net-
work. The federal government ha s since
provided billions of dollars for securing
the administration of elections.
All voting machines are supposed to be
“air-gapped” (not connected to the inter-
net) making them much harder to infil-
trate from afar. Attackers could try to alter
voting results by loading malware onto
USB sticks that get plugged into the ma-
chines or embedding it in the code run on
them (the government’s own hackers used
this technique to sabotage Iran’s air-gap-
ped nuclear centrifuges). But even if Russia
did manage to sneak a virus onto some of
these machines it would need to remain
hidden during routine logic and accuracy
tests conducted before the election which
ensure that the devices’ tabulated totals
equal the sum of the individual votes en-
tered on them. Rigorous reviews of soft-
ware and vote tabulations have revealed
no evidence of any electronic ballot-stuff-

Election interference


Voting machines are reassuringly hard
to hack; voter rolls are not

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