Friday, March 13, 2009

Obama's Anti-Employment Policies

Imagine that Smith is employed and Jones is unemployed, and that Smith and Jones are equally qualified in every conceivable way for the same job.

It is in Smith's self-interest that wages rise.

It is in Jones's self-interest that wages decline. That is, it is in Jones' self-interest that any union or government minimum wage law be eliminated so that Jones can bid for Smith's job at a lower price.

Smith's enemy is not his employer, who would just as soon pay a lower wage for the equally-qualified Jones. Smith's enemy is the unemployed Jones. Employees and employers are not competitors; employees compete against other prospective employees.

Prof. Reisman points out:

    Thus there are two parties -- unemployed workers and employers -- whose self-interest lies with a reduction in the higher wage rates achieved by collective bargaining.
    If these parties are free to act in their self-interest, the system of collective bargaining must break down. How are they to be prevented from acting in their self-interest?
    The answer is physical force.

Reisman observes:

    A recent article in The New York Times quotes President Obama as saying, “I don’t buy the argument that providing workers with collective-bargaining rights somehow weakens the economy or worsens the business environment. If you’ve got workers who have decent pay and benefits, they’re also customers for business.” (March 2, 2009, p. B3.)
    Collective bargaining is the joining together, typically through the instrumentality of a labor union, of all workers in a given occupation or industry for the purpose of acting as a single unit in seeking pay and benefits. It is an attempt to compel employers to deal with just one party—i.e., the labor union—and to come to terms agreeable to that party or to be unable to obtain labor.
    The imposition and maintenance of collective bargaining necessarily depends on compulsion and coercion, i.e., on the use of physical force against both employers and unemployed workers.

See Reisman's blog for an excellent summary of the damage done to all American workers by forcing wage rates up by compulsion and coersion.

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