I’m not an economist, but it strikes me that there is an obvious economic justification underlying Andy Stern’s persuasive moral argument.* Stern hints at it when he cites McKinsey & Co.’s conclusion that, by 2008, Fortune 500 companies will spend as much on health care as they make in profit. Simply stated, American firms stand to benefit from a physically and financially stronger and more secure American middle class. Working towards that end is a savvy investment.

A central issue in union negotiations across the country is productivity. Employers want increased productivity. Employees, in return, demand accordingly increased compensation. That may be a quick fix. The surest way to increasing long-term productivity, though, is to support the workforce. Workers who are highly educated and well trained will compete effectively in a 21^st century technology- and service-driven economy. Workers who have economically secure and physically healthy households will work for a single employer for longer periods of time, and will miss fewer days of work. Ultimately, the resulting cost savings will increase profits. Reinvesting those profits in the workforce will yield even greater profits. The cycle is beneficial.

This logic extends beyond the individual firm level. A healthier workforce will require less state and federal healthcare spending. A better educated populace will require less job retraining and less extensive unemployment insurance and welfare programs. Ultimately, such savings will result in lower individual and corporate tax burdens.

If this is as intuitive as I suggest, why hasn’t it materialized? It’s a classic tragedy of the commons. Individual firms are reluctant to act unilaterally for fear losing a competitive edge as compared to peer firms. If nobody acts, though, we’re all stuck with the status quo. That, I think, sets the stage for one of the strongest cases for unionization. If organized labor can make a series of industry-wide cases for more efficient health care coverage, more financial security for middle class families, and more efficient labor, it may enable firms to act collectively. That may be the only opportunity firms have not to drown in the face of increasing pension and healthcare obligations.

I’m no fan of the particular brand of liberal politics that posits that corporate interests are inherently adverse to the interests of workers, and I’m inherently skeptical of superficial criticisms of corporate earnings. Andy Stern recognizes that organized labor leaders can no longer rely on arguments that were developed more than 70 years ago. I’m eager to see the case he and other leaders make to corporate America.

* I grant that my argument is speculative. If anyone has interesting data that supports or refutes my contentions, please share it with me and I’d be happy to update this post.