Here's why, as Roberts's self query and answer in a linked L.A. Times piece indicate.
So where does the average worker get bargaining power if unions are in decline?
The simple answer is that bargaining power comes from having alternatives. Even in the absence of unions, employers have to treat workers well to attract and keep them. In a workplace as dynamic as that of the United States, where millions of jobs are destroyed and created every quarter, a company’s ability to exploit workers is greatly limited by how easy it is to find another job.
Ultimately, it is competition among employers that protects us from exploitation. Even those who would seem to be the most vulnerable — immigrants who struggle to speak English, for example — can earn much more than the minimum wage simply because of competition for their skills. Cleaning people routinely earn $20 an hour, more than most cities’ so-called living wage.
OK. I'll grant that this probably didn't look as mind-bogglingly stupid in the halcyon days of February, 2007 as it does in March, 2010, when there are six workers competing for every available job. But that business about "Cleaning people routinely earn $20 an hour" had to be a hoot, even back in the day.
When called a hack by Kevin Drum of the Washington Monthly, Russell, with characteristic Libertarian aplomb retorted:
I assume his facts are right. Only they have nothing to do with the point I was making. I didn’t say that the national average for janitors was $20 an hour. I wasn’t saying that it’s fun to be a cleaning person. I was trying to make a much simpler point. In many American cities, the going rate to have someone come to your home and clean your house is $20 an hour.
Setting aside that he made NO indication that he wasn't talking about janitors, Russell must have been assuming that the fee that is payed translates into the rate that is earned - no transportation time or expenses, no overhead costs, no intermediary skimming off the top, etc. Also, no realistic chance to make $40 x 20 = $800 dollars in a 40 hour work week. Clearly, he was scrambling to cover his ass.
This is what you can always expect from Hayek acolytes: a world that bends itself to their pre-conceived notions of ideal economic balance and equilibrium, courtesy of THE FREE MARKET FAIRY, and her (his?) magic wand.
In Hayek's world, markets are rational and perfectly efficient. If you lose your job today, all it takes to find one tomorrow is some serious looking. Details such as a likely pay cut, necessity to relocate, to retrain, or whatever else you might have to do are simply indicators that you need to adjust yourself to the realities of your situation. Being trapped, helpless and hopeless is not a reality the Austrian Economists are able to recognize. Or if they are, so what. Get off your duff and start working, slaggard. Unemployment compensation is just a paid vacation.