Isn't this also how companies perceive job cuts and wage reduction? Forget about Henry Ford's idea of having a population that can actually afford to buy your products, just keep cutting labor costs.
Edit: Or stock buybacks. Just as long as "the line goes up" for now doesn't matter if you run the whole ship into the ground in the future.
The impact of organized labor has been analysed a lot - have a look at the literature, it isn't trivial.
This is actually a good point, and is detrimental for similar reasons: concentration of power, reduction of competition and increased fragility of the whole system ("too big to fail").