As I once learned from Professor Larry Summers, one "cause of long-term unemployment is unionization."

Greg Mankiw, observing an executive order by Summers' boss that insures fewer government projects for your tax dollar. How many fewer jobs? Summers wrote:

Between 1970 and 1985, for example, a state with a 20 percent unionization rate, approximately the average for the fifty states and the District of Columbia, experienced an unemployment rate that was 1.2 percentage points higher than that of a hypothetical state that had no unions. To put this in perspective, 1.2 percentage points is about 60 percent of the increase in normal unemployment between 1970 and 1985.

Is this part of the difference between "the perfect and the absolutely necessary"?

Labels: economics, Obama