Wednesday, October 21, 2009

Redistributing revenues 

Many friends tell me of setting up for conventions, where they experience the requirement that workers do the set-up of their displays for them. This is not a free service; union rules in convention facilities can in some cases govern minimum hours and number of workers hired, who can be hired, etc.

All this is in the way of redistributing income between those who provide content for an event and those who provide a service to the content-providers.

A story in Bloomberg yesterday
illustrates this very well.
After you practice for years and get to Carnegie Hall, it�s almost better to move music stands than actually play the piano.

Depending on wattage, a star pianist can receive $20,000 a night at the 118-year-old hall, meaning he or she would have to perform at least 27 times to match the income of Dennis O�Connell, who oversees props at the New York concert hall.

O�Connell made $530,044 in salary and benefits during the fiscal year that ended in June 2008. The four other members of the full-time stage crew -- two carpenters and two electricians -- had an average income of $430,543 during the same period, according to Carnegie Hall�s tax return.

They can make a "credible threat" of withdrawing their labor, but so what? The pianist can get friends to roll a piano on stage for much less than this. Performances at our university rely on students to provide this labor for free -- surely there's some midpoint between free and a half-mil?

So how is it that the union acquires this power? They will tell you that it comes from "collective bargaining negotiated fairly with management, signed by management and ratified by the membership of the union.� Why does management sign such agreements? As seen at the bottom of this article, and like most other concert venues, Carnegie makes a loss based solely on concert revenues. They earn a profit when you include "funds from donors, investment income and government grants." But driving up that price has the consequence of making it harder for someone other than the high-wattage star pianist from getting to perform. They are pushed to smaller, out-of-the-way venues and earn a lower income. So a question: Does the union help someone running a Carnegie Hall get grants and donations, to "cover costs" that are actually monopoly revenues for union workers?

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