Labor Unions

2010/03/24

Commies are ecstatic

http://peoplesworld.org/health-care-victory/

Oh, no, it’s not socialism or anything. It’s just a coincidence that the Communist Party USA is super excited about the health care reform bill. You silly, racist conspiracy theorists and tea-baggers just need to pipe down and swallow it. It’s good for you. Really.

But seriously. Anybody who thinks this is a “mainstream” piece of legislation and a good idea founded in American values is a sucker. This is nothing more than a massive vector of attack for authoritarian control of your life.

We join with those who hail this legislation both as a measure that will save lives now and begin curbing the insurance industry, and as a giant first step to further reforms that will provide quality, affordable health care for every person in the United States.

Beyond that, its passage is a major defeat for the far right – the Republican Party, sections of Corporate America, and their fascist-like tea party shock troops. The enactment of this bill is an enormous victory for the broad progressive movement in our country. It will give energy and enthusiasm to that movement as it mobilizes and builds for the struggles ahead to advance a pro-worker, pro-people agenda.

The far right has been left glaringly isolated but perhaps even more dangerously aggressive. These racist hate-mongers fought viciously to block the bill on behalf of the nation’s insurance companies and now say they will continue their dirty campaign by trying to repeal it. But it’s clear that an energized people’s movement will not let that happen.

Even organizations and individuals critical of the bill (because of restrictions on women’s reproductive rights, or its exclusion of undocumented immigrants, or because it doesn’t go far enough) have acknowledged its importance and far-reaching implications.

The great majority of health care reform advocates, including those who call for a single-payer system, see the legislation as opening up space to further the struggle for Medicare for all. Many note the bill provides a number of immediate benefits.

AFL-CIO President Richard Trumka called the bill’s passage a "momentous step toward comprehensive coverage" and vowed that labor will continue to advocate for health care that works for working families.

The new law reestablishes the role of government in providing a "safety net" to support ordinary folks against the most outrageous excesses of our health care system. As President Obama put it, "It enshrines the idea that everybody should have universal health care."

The fight isn’t over. The corporate-backed far right will continue to use racism, lies and anti-government conspiracy theories to try to scare and confuse people. We got some ugly glimpses of this just as Congress was on the eve of passing the health care bill.

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2009/07/19

Sunday Philosophy: The Minimum Wage

Minimum wage laws are idiotic.

The idea of the minimum wage appeals to the charitable side of human nature. The idea of protecting or providing for the "working poor" among us appeals to our sense of justice and fairness. Nobody wants to see other people starving, or who are unable to house or feed themselves. And the expedient way, it seems, to make sure that everybody who works can afford their basic needs is for the government to tell employers how much they should pay their workers. 

monopoly-guy[1]

The federal minimum wage in the United States was first proposed and created as (you guessed it) a New Deal program by President Franklin Roosevelt. Roosevelt’s justification was that, "no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By living wages I mean more than a bare subsistence level. I mean the wages of a decent living." Never mind that the workers also depended on the business for their existence. From the very start, it was an open attack on business, on the free market, and a socialist intrusion into the marketplace by a set of "experts" who believed they could manage the economy better than the workers and owners who made up the business itself. To the left, exploitation of workers must be avoided, unless of course it’s the left that’s doing the exploitation, as we’ll see later.

The minimum wage is perpetuated by continually appealing to the "compassion" of citizens. Not compassion for the business owner who is providing a valuable service, not compassion for his customer who wants to purchase the service at the best price, but for the unskilled, inexperienced, worker. The political infatuation with the minimum wage is based on the idea that every single job should provide a wage that goes beyond "subsistence level."  Every job, they argue, should provide a "decent living."  Apparently, that wage in the United States is currently $7.25 an hour. It’s absolutely silly to think that making $7.25 an hour in New York or San Francisco is going to provide a decent living. Wouldn’t it be more compassionate to raise that to $10 an hour? $20 an hour? $50 an hour? If the motive is compassion, why would we limit ourselves to $7.25 an hour? Since we set the minimum wage at a level that is basically a pittance, compassion must not necessarily be the goal of the policy-setters.

The truth is that we all know that raising the minimum wage will either affect the price of the goods we consume, or cause entry-level, unskilled workers to lose their jobs.  We’re willing to be “compassionate” with other people’s money, but not compassionate to the point that it actually affects our own wallets. And we don’t want to be compassionate to the point where the people we want to help get fired from their jobs because their salaries become unaffordable. We just want to be passionate with money of businesses, but only to the point that the only people inconvenienced are the owners of the business, greedy pigs that they are. So the whole idea of Americans wanting to provide a "living wage" to unskilled laborers is silly, class-envy pandering for Marxist political candidates. Most Americans really believe that people should earn their own money and keep their own money, and if people want to earn more money, they should improve their skills and marketability to employers. But for some reason we’re also afraid someone might think we’re “greedy” or “mean” for not wanting to “help the poor,” so we’re suckers for an appeal to our compassionate sides. But that’s an illogical response to a stupid accusation.

Who actually earns minimum wage in this country? According to the Employment Policies Institute, "The average family income for employees who will ‘benefit’ from the recently enacted $2.10 minimum wage hike is $46,889."  That’s more than double the federal poverty line for a family of four. How can that possibly be?

Six out of seven of these employees either live with their parents or relatives, have a working spouse, or are single and don’t have children.

The vast majority of minimum wage workers are people who live with someone with a well-paying job. They are teenagers or spouses who work part-time. The number of minimum-wage heads-of-household is staggeringly low.

Virtually all minimum wage employees will see their incomes rise as they increase their value to employers by gaining skills through experience. Analysis of US Census Bureau data shows the median raise these employees receive is six times higher than that of employees earning above the minimum wage.

People who start at minimum wage tend to get huge raises early on as their skills and experience increase.  Work experience counts for a lot to employers.

This traditional growth out of entry-level employment explains why less than 1% of employees above the age of 25 are working at the minimum wage.

By the time people exit their college years, 99% of people are making more than minimum wage. The liberal myth that people sit in minimum-wage jobs for decades or while trying to raise their families is simply not true.  It’s a lie.  It’s intended to tug at your heartstrings and get you to beat your chest and demand that somebody “do something” about it. And plenty of heartstrings must get tugged, because it sure isn’t brainstrings that keep this ridiculousness alive.

A business will hire a person if they believe that the value they gain from that employee will be worth more than the salary and expenses associated with them. A business can choose to hire skilled workers for a lot of money, or unskilled workers for less. It may be more cost-effective to hire one very skilled worker to do a job, or it could be more cost-effective to hire several unskilled workers to do the job. It’s all based on the risk the company is willing to take, and the prevailing wages that the market has determined for different levels of skilled labor. But when an outside factor comes in (a.k.a., government) and artificially sets wages for unskilled labor that are higher than than the market suggests they should be, it’s more likely to tip the scale towards businesses choosing to fill their positions with skilled laborers. (Or alternatively, the minimum wage may be a floor that determines what you must get paid. Either way, it weakens an individual’s ability to negotiate for what both parties think is a fair wage.)

The natural outcome of all this means that the market for unskilled labor shrinks.  It’s tougher for young people to get meaningful entry-level work in which to build their business and professional skills.  It’s tougher to get part-time work, because it makes more sense to have a few higher-skilled workers work more hours and reduce the amount of unskilled workers needed. And it has destroyed the idea of apprenticeships, where a young person is able to sacrifice wages in exchange for the opportunity to learn valuable, marketable skills.

So if there isn’t a real benefit for the people who would actually want to work at entry-level jobs, why is there an obsession among lefty politicians with raising the minimum wage? Well, that’s obvious: labor unions! The stalwart defenders of the American working man (and major contributors to political campaigns, not that that has anything to do with it.  Right?).

The bottom line is that union leadership really only care about workers who are members of the labor union. And labor unions tend to represent skilled workers. Union dues are usually a percentage of salary, so the higher-paid union members are going to produce higher revenue for the unions. So the more the balance of labor can be skewed toward skilled labor and away from unskilled labor, the more labor unions stand to gain. Don’t misunderstand me. Labor unions will accept any kind of membership they can, skilled or unskilled. But their goal is to maximize their skim from the highest earners in their organization. And that is done by making it more profitable for businesses to screw the unskilled, inexperienced, entry-level worker out of the labor market in order to benefit the skilled, labor-union member.

The minimum wage restricts the market for young, unskilled laborers to find work and gain experience. It punishes business, particularly small business, by restricting their ability to negotiate salaries with employees. It doesn’t provide anything near a “living wage,” was never meant to, and never will.  Instead, it favors organized labor by artificially skewing the market in favor of skilled labor union membership which drives up union revenue. It’s just another example of socialist, non-market-based price-fixing that always, always fails to do what it intends.

But it plays well around election time, so don’t expect it to ever go away.

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