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Thursday, November 29. 2012
The recent Wal-Mart strike on Black Friday seems to have galvanized the labor movement. To what outcome, we shall see, but I suspect they are operating with some huge misconceptions.
As I drove to the train station, I heard an interview with one of the leaders in today's strike of fast-food workers here in NYC. He has a pleasing workers' story which he is spouting about 'living wages' and the need for workers at these companies to make trade-offs between a Metrocard and dinner. I'm all for 'living wages', but I think people have to remember when they take a job they need to determine if it's going to require them making tough choices. If I live so far from work that the cost of getting there deprives me of a meal, then maybe I need to find something closer to where I live.
In their appeal for 'living wages', which they have defined as $15 an hour, the organizers shared a oft-told story about Henry Ford knowing that he had to pay very high salaries in order to get the most out of his laborers. This is an old and popular myth among organized labor. Ford's pay raise had more to do with the cost of losing labor and training replacements, rather than offering them a reasonable lifestyle. More importantly, gaining access to the very tidy sum he offered meant giving up some personal rights in the process. I wonder if these strikers are willing to take on the same requirements Ford's did to earn their wage?
I believe workers have the right to organize, if they feel it is in their best interest. I also think it's wrong for management to threaten or otherwise make life difficult for those doing the organizing, unless it is impacting their job performance. But invariably, the organizing leads to fewer jobs and increasing demands on the part of the work force. A quick history of the auto manufacturing industry shows the negative impact of labor demands, which ended up in taxpayer bailouts (which, despite much government PR is still not at break-even). Even now, with the auto industry still struggling mightily, labor is already stepping up to take back what they view as rightfully theirs. (I do not believe the recent reports of high profits is an indication of a healthy auto market. Sales are still far below peak levels, costs are low but rising, competition is greater than ever, and most importantly - these 'profitable' firms all had their debts assumed by the taxpayers.)
Modern management has tended to take workers' needs and requests into consideration and has often worked hard to keep good relations. This is not always true, and I cannot speak for today's fast-food strikers, but it is part of the modern corporate management for which I've worked. Although a management group which claims it can work with labor often finds itself dealing with unintended side effects.
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Since a non-working moocher on the public dole lives at a $60K income level, thanks to the plethora of welfare programs to draw upon, I applaud those people still choosing to work for their daily bread. And I thank them too, since we in the producing class would otherwise be expected to pay their bills.
It is a fallacy to believe that everyone can be paid a living wage. Most of the products we are accustomed to are kept affordable because the labor costs are low. If all the lower paid employees were to starting tomorrow be paid twice as much then the costs of everything would double at the same time. The result would be inflation that would negate the income gains and they would effectively in the same situation as they were before the wage increase. While it is probably a sad state of affairs for the poor that we cannot all earn a "living wage" it is inevitable and for the society as a whole actually a good thing. The good news is that there is a viable solution; work harder, go to school, work smarter, improve yourself and your value to an employer. This is an individual solution and there is no viable solution for all of society. Just as we cannot all come in first in a race or all score 100% on a test we cannot all be rich or even middle class.
Which is why I put the term in quotes, because I'm not sure there is such a term that is easily definable.
However, if someone could come up with it, then I'm all for it. Since nobody can or ever will, I'm at least willing to say I'm in favor of something that sounds good, even if it's undefinable, but since it's undefinable, then it's illogical to base a strike on its existence.
The wage someone earns at a fast food restaurant is what it is - if it is not a 'living wage' for that person, then perhaps they need to improve their skill sets or keep looking.
With regard to the first comment - I'm quite pleased they are working, too. But part of the 'complaint' of the group running the strike was that it was 'wrong' that they should be working and still have to rely on public assistance (as many of them apparently do).
I agree. It is wrong that they should do this. So let's cut back on the assistance.
When I was younger, it was often a point of pride (very tired pride, but pride nonetheless) for people to say they worked 2 jobs. They made it a point to mention in order to instill in us kids the desire to work hard and make something of ourselves.
Today, working 2 jobs is considered demeaning. Unfortunately, we don't all have the smarts or skills to earn tremendous salaries at great jobs we all love. Some of us will have to work harder than others to get what we have. That's just life.
That sounds cold hearted and I'm sure some liberal will call me some names and point out how heartless I am. But I'm sure that same liberal had a parent or grandparent who worked their ass off and is looking at them and saying "I'm not sure what family you're from."
Designating a "living wage" is about as slippery as having a leftist tell you how much taxation is "enough." Taxing you at 50% sounds great to a democrat, until they figure out they would really be better off with 55% of your income, and so on.
And what does pushing a living wage to $15 an hour do to other wage structures. You'd probably think twice before taking that job for $17-$18 an hour where you're going to have to work your butt off and take beacoup poop off of somebody if you know you can go to Mickey D's and make $15 an hour for slinging burgers, and get grub to go home on at 50% off. It's hard telling how high that would push other wages as well as the unemployment numbers (and yes, goods would cost more). The only thing we need to understand about economics is that people respond to incentive (good and bad), everything else is just conversation.
I believe workers have the right to organize
I have mixed feelings about that. Labor unions are a type of monopoly and have all the downsides that industrial monopolies have. Maybe more, for sometimes the only option for the 'customer' is to shut down.
That puts me in mind of patents and other forms of IP. I suspect there are those who cheat on such things, using goods produced by scabs, so to speak, while having progressive views about unions.
That's not a question of rights, that's a question of being smart about your problems. Wal-Mart can afford to take a strike, so they strike and take their chances that Wal-Mart will rehire them. My mom-and-pop porcelain factory would not survive a strike by its skilled employees, so the workers would never consider it. That doesn't mean they don't have the "right" to walk out the door if they think they are being treated wrong.
The Occupy Wall Street twitter kind of shows off the ignorance of these strikers though: "Walmart yelled @ me every time I used the restroom. I WAS PREGNANT & they didn't care" As if going on strike would force them to be nicer to pregnant part-timers.
Check out the lead story in the Burlington Free Press yesterday. One of the progressive wunderkinds got an exemption to the living wage policy at one of his restaurants. Very entertaining.
Sadly, those demanding a "living wage" of $15/hr seem to think that folks will be willing to pay $10 or more for a burger.
If I'm going to pay that much for a burger - it had better be damn good and serviced on china by a waiter - not wrapped in cheap paper at a greasy, fast-food joint burned on a griddle by an ex-con.
Adding to the points made earlier, it would be interesting to calculate the "effective wage" available today versus, say, in 1960. My thought is that someone making a minimum wage today might get - at a minimum - an EBT card or some rent subsidy. An EBT card credited with $160 per month effectively gives this person another $10 per hour worked if they are employed full time. This benefit was not readily available (or readily utilized) in 1960.
In essence then, the taxpayer is subsidizing low-wage companies and industries.
As Avery points out, the right to organize is different from whether they should organize.
I was a member of the AFL-CIO in my younger days. I didn't want to join, I HAD to join to hold a particular retail job. I hated it. My 'raise' was less than the dues I had to pay. It was a forced tithe, which I wrote a letter to the union management about - and was ignored, of course.
But the right to organize should exist for anyone who thinks they need to. I just don't understand the need.
Do you have a right to strike? Do you have a right to organize? This begs the question. Level the playing field so that unions and union members have exactly the same rights as individuals and non-union groups. Give the owners of businesses exactly the same rights as unions. The problem is that politicians have given unions mega-rights. Unions now have powers that monopolies only dreamed about in the past. Make the playing field level. Allow the unions and union members the right to strike and also allow the employer the right to terminate anyone who strikes. Require the police to apply the law equally to unions and union members illegally tresspassing and disturbing the peace. Allow an employer the right to get a restraining order against any employee or union member that threatens them or tresspasses. THEN we could honestly discuss "rights"
Do I have the right? Yes.
Would I? Probably not.
I have seen strikers, from our unions, outside my offices. There has always been a police officer nearby. There have never been disturbances (of the peace or otherwise).
Is my experience typical? Probably more often than not, though I know sometimes things have gotten out of control and when it does the blame isn't nearly as cut and dried as either side would ever like it to be.
My first job out of college was with a major steel producer. I concluded that you could tell when the union workers were on strike because they were standing around with signs. When they were not on strike, they just stood around.
Being a white collared white guy working in an integrated steel mill can be dangerous if you got on the wrong side of the right person.
The problem is that welfare system should not exist. At best, taking it should involve giving up the voting rights of a productive citizen.
Thanks for the chuckle. Having worked at a steel mill myself, your standing around comment was too, too true.
Sadly, the U.S. lost it's market to overseas manufacturers who could afford to process AND SHIP over to our ports for far less than American companies.
Wait a minute. let that irony sink in... "Sadly, the U.S. lost it's market to overseas manufacturers who could afford to process AND SHIP over to our ports for far less than American companies." I wonder why it was so expensive to manufacture and process here?
A side note; in the state where I live the longshoremen are going on strike. We all have a vision of a long shoreman being big and strong and unloading heavy cargo, but that was decades ago. Todays longshoremen are truck drivers and heavy equipment operators. I believe their average wage is well over $100K a year plus overtime. Their benefits are the best in the world. And their going on strike!!!! For what? They want catered lunches or what???
This is a result of pricing everything in dollars (and more generally a problem of fiat money).
People forget that the dollars are only a representation of what a work-hour is supposed to be worth, in terms of relative work-hours in a different job, or relative amounts of valuable stuff. We act like dollars have an actual independent economic value. They do not.
How many fast-food hours are needed to get one doctor hour? How many fast-food hours are needed to get one teachers hour? One farmer hour? One banker hour?
If doctor hours are scarce, a fast-food worker may never be able to afford enough doctor hours to address all the needs of the fast food worker. Unskilled and semi-skilled labor just isn’t worth that much, in terms of highly-skilled or specialized labor.
Our credit- and fiat-money based system has allowed us to separate what a task is truly worth from the number of dollars we attach to it. Changing the number of dollars attached does nothing to make the underlying real task worth any more or any less.
We are headed for a Great Repricing, where all these distorted dollar values come back in alignment with more “natural” hour-based or stuff-based relative values.
Get a helmet.