An Alternative Theory of Unions

Paul Graham’s essay An Alternative Theory of Unions proposes that high-paying union jobs were a temporary economic aberration.

The Growth Industry Context

Manufacturing in the 1950s was expanding rapidly. Companies prioritized speed over efficiency: “If there’s some mundane problem getting in your way, and there’s a simple solution that’s somewhat expensive, just take it.”

Workers as Infrastructure

Graham compares workers to servers in internet startups—valuable for reliable supply rather than minimal cost. Growing firms overspend on necessities to avoid delays.

The Aberration Theory

High union wages represented temporary market conditions, not permanent moral achievements. Graham uses 1990s internet consulting as analogous—unsustainable compensation from exceptional circumstances.

Decline Explanation

Modern growth industries (tech, services) don’t require the same labor-intensive infrastructure that 1950s manufacturing did.

My Takeaway

The era of powerful unions was situational, not ideological—an economic quirk of a specific historical moment.