The aim of this research note is to begin to develop the idea that trade unions are historically constructed as much through considerations of social identity as they are through calculations of economic self-interest, market power, or functional adaptation in the face of changes in the division of labor. By social identity, I mean the desire for group distinction, dignity, and place within historically specific discourses (or frames of understanding) about the character, structure, and boundaries of the polity and the economy. Institutions such as trade unions, in other words, are constituted through and by particular understandings of the structure of the social and political worlds of which they are part. In making this argument, it should be immediately said that I in no way intend to claim that trade unions are only to be understood through the lens of identity or that they do not engage in strategic calculation either in labor markets or in the broader political economy. The point is that action along the latter lines presupposes some kind of commitment on, and even resolution of, issues concerning the former. The discussion below focuses on the emergence of trade union movements in the United States and Germany during the nineteenth and early twentieth centuries. It Attempts first to develope the two cases as constituting a paradox and then, second, explains the paradox with an argument about identity.