Labor Unions: Thoughts

Capitalism functions because of exploitation. You can’t make profit without a level of exploitation, i.e. labor must be compensated less than the value that the work produced to yield profits. The degree of profits yielded in proportion to the value produced is a good indication of whether exploitation is occurring. If you look at profits, productivity, and real wages, you’ll see that severe inequalities exist.

I use the word “exploitation” because it doesn’t sugar coat the reality of what’s going on: unequal bargaining power leads to income, wealth, and opportunity inequalities. Unions exist to restore bargaining power from the management/ absentee ownership. It’s when unions possess greater bargaining power than their employers that inefficiencies arise.  The decline in unions is a major reason why inequalities have risen over the years.

The US works more than any other country. We have the least vacation days of any other industrialized/ OECD nation. We have the least paid vacation days. I don’t think it’s fair to compare inequalities between developed and undeveloped nation. It’s all relative. So you think we have it pretty good in the US, that $7,25 isn’t too bad? You are forgetting that $7.25 is meaningless without a context, i.e. the cost of living, CPI/ inflation has continued rising despite stagnating wages making it increasingly difficult to save and live comfortably, especially for those in the lowest income brackets. Poverty levels are artificially low due to the credit boom– which, since its bust, has led to increasing poverty levels. The Gini coefficient has rising consistently since the 70’s, which I attribute to the coinage act of 72/ introduction of fiat currency which instituted federal monetary policy.

Also, the vast majority of worker representation has been the direct result of union organization. People should appreciate the value of unions and why they’ve been vital to our progress. You can thank unions for: the 40-hour work week, overtime pay, vacation pay, sick days, workers compensation and a living wage. Union decline is mostly do to corporations becoming increasingly ideologically opposed to them: It’s all about shareholder profits.

As resources become monetized and increasingly scarce through the process of capital accumulation, concentration, and centralization, there will be an inevitable rise in exploitation and inequality. US economic data points to this trend. After looking at history, throughout all civilizations, you’ll see that man’s natural tendency is to exploit as a consequence of his natural will to power/ dominate. I do not think any nation, especially the US, is immune to this tendency. Slavery is very real. We might not have chattel slavery, but with increasing debt levels and the passing of recent laws preventing the option of bankruptcy, I would argue that we are experiencing the rise of a certain “bonded slavery”. Choosing your wage contract is just an illusion of freedom if someone still owns your labor income. Allowing workers to choose which job they’re best at allows for the efficient allocation of labor. (Recent legislation just made it legal to deduct outstanding debt from paychecks before you receive it)

All I’m saying is that, contrary to what a few politicians spout off, unions are actually a good thing for democracy, equality, and economic progress. Maybe they don’t make us as competitive abroad, but we’re importers, not exporters anyway (International current account imbalances is a separate issue). Ensuring that our labor force is receiving equal and fair distributions of income/ wealth maintains consumption, drives domestic demand, and fuels economic progress. Income inequality and disparate levels of capital accumulation increases financialization, decreases real asset investment, and hampers long term economic growth– and could potentially lead to economic stagflation, which many argue we are seeing the beginnings of.

If you are ideologically opposed to unions, I would like to ask that you explore how unions have been instrumental in improving our economic development and our standard of living as a nation and consider reevaluating your position. They are incredibly important for our long term economic growth. This is a nice read from a non-partisan think tank: Why Unions are Good for the American Economy

You must understand the real utility of unions. Yes, work conditions have improved, I agree. That’s not why I believe they’re so important nowadays (after all, if I worked as a slave making nothing, but the conditions of my job were exquisite, I would still argue there were serious problems). I’m discussing why unions are important for ensuring that increases in income distribution mirror increases in productivity. One of the most important roles of unions is ensuring fair wages. This is why I believe they are important: restoring and equalizing bargaining power.

Yes, there have been massive changes within the labor markets from industrial to technology, but that doesn’t explain why wage inequalities have risen, and why it’s not due to decreases in unions (decreases in collective bargaining power) and increases in corporate/ management bargaining power. Federal monetary policy is a major reason for contributing to this bargaining power inequality. By establishing an arbitrary target inflation rate (NAIRU is bull and the Taylor rule is empirically bogus) and avoiding full employment, they create a surplus of labor which in turn decreases employee wage contract bargaining power that would otherwise increase their wage compensation to fair levels (and eliminate wage stagflation).

Why are individuals leaving unions? I would ask myself, why would they leave when they have better pay and benefits? This doesn’t seem rational. As I mentioned before, corporations make it incredibly difficult to join a union. They’ll import labor from somewhere else in the country before they’ll accede to union demands. It’s simply not advantageous to join a union when you could risk losing your job (especially when unemployment is high/ artificially inflated– they could simply hire someone else).

Politics (and the role of lobbying) play a very significant role for this decline.

Another article detailing how politics have reverses the role of collective bargaining, and how that has negatively impacted income distributions and growth.

Here is a study showing that decreases in unionization are responsible for a third to a fifth of all increases in inequality.

This study shows that unions have a direct positive impact on labor’s share of income, with the decline of unions responsible for about 29% of decreased wages.

Why have wage inequalities has risen over the past decades?

There can be serious problems with unions. I’m not arguing dysfunction can arise. Teacher unions have grown so large and powerful that no realistic progress can be made. It’s silly. I watched Waiting for Superman and it was appalling, but it’s a system that serious serious overhaul. But collective bargaining power is an important feature for preserving equity within the US.

Epic Blurb

I love swimming. Becoming totally engulfed in an essence. I love swimming in the ethereal feelings and thoughts kindled in my glowing imagination. I want to live fully. What do I think?

I cannot keep putting off responsibilities. Responsibilities like… homework, studying, keeping in touch with people, being happy. I have a responsibility to be happy ya know. No one else is responsible for my happiness. Its unique to me.

Is it good to avoid criticism? Should one look for it?


I visited cousin at Amherst College this weekend. Watched the football game. Beautiful campus. Small population of students but spacious none the least. Hung out with the football gang. All seemingly intelligent people. It’s odd to visit a wet campus. Alcohol prevails in every dorm and every hall. The smell of stale beer leads you to the next party. Filled with juvenile adolescents indulging in self destruction- pounding away at another helping of hoppy watered-down ethanol or some other distilled liquid pleasure. These people. Freedom is such a new quality. I remember the days when I was overwhelmed with freedom. It’s where the irresponsibility started and accountability faded away as I justified my actions with those of my peers. Sad really. My individualism was lost amongst the crowd. And for what? Acceptance is too cliche for an answer. I stripped and tossed my convictions without hesitating a moment. No contemplation. We don’t think that far ahead in our youth. We live in the now. We rarely take time to see into the distance future. If we did, we would see how our accumulated actions would be disserving and adjust accordingly.

Maybe its alright to pander to some of our fleeting youthful satisfactions. Its a slippery slope. The miligram experiment by social psychologist stanley milgram perfectly illustrates what happens when we undermine our convictions. We continue this trend until there are no limits to what we do. The line has been crossed, we are confused, we lose sight of right and wrong as we justify out previous slip.

Amherst was fun. I’m through with the binge atmosphere. I want social glee. I want to be surrounded with quality people who enjoy the finer things in life. Who rise above mindless impulses and short-lived thrills.

Education will not solve the worlds problems. The worlds problems are more than the tangible pressures we face. We face trials of the heart. When the man is right, his world will be right. How can education cause men to be more introspective with their intentions? Just because a man is sincere doesn’t mean he can’t be sincerely wrong. Is man the measure of all things? How far does this measure extend?


I often wonder what would happen if I forfeit all the wisdom I’ve believed to have accumulated? What would happen to my world is I tossed my convictions and standards into the wind and remained wild, totally free from reason. Ha. As I say this I just think of how most post-modern liberals behave. I’m sure my behavior wouldn’t be that different.


I need to write a paper. A LONG paper. A case study. On a company with a woman who’s got no work ethic. Who started a business strictly because she does not work well with authority. Who stated that shes alright with her businesses minimal growth because she reaps tax benefits and money from subsidies to small businesses. She is stealing our tax money becuase she refuses to work hard to earn more money for herself. Wow. This women is nice. She’s got some good ideas. She is clueless when it comes to investing herself into a vision and seeing that vision come alive. She instead settles for mediocrity. A business that’s providing barely enough to get by. She comes to work late. She fired every employee shes hired because of ‘personality conflicts’ but stated that she prefers an employee because that makes me come to work on time. People. I swear. How the hell do I even approach this study. I outlined a business plan proposal. When I write the paper I obviously want to write like this is going to a valuable company with vested stakeholders- instead, I think about how this women won’t heed a damn word and although my analysis of her basic production methods is legitimate- I find that all she needs is a good lesson on working hard and the principles of success. Being an economics paper I can’t very well write a philosophy discourse of strategies for success, but I’m EXTREMELY tempted. If there wasn’t a hefty grade attached I would write such a paper and throw it in her face. I’d also rattle off a few rants on why any social distribution of wealth is inherently flawed due to free loaders like her.

My God! People must misunderstand me all the time! When I talk of success- this doesn’t translate into financial gain! People probably think I’m so egocentric and highfalutin because they totally misinterpret success. Actually- they are totally ignorant to success in general so they are stigmatized to the notion!

SUCCESS!!!! What it means!!! Progressively realizing a worthy ideal!— And working towards it with every molecule and vibration in your being! Being excellent and exploring the unknown wellsprings of untapped potential! BEING THE BEST AT WHAT YOU DO! If you decide to do something- put your all into it! Enough???? “Aren’t I doing enough” you ask? Enough is only your best! Do not lie or deceive yourself. There is no such thing as failure. There is no such thing as try! There is Do. or Do not. Live. or live not. You choose.

I believe that all psychological illnesses stem from people not realizing their full potential. They sabotage themselves and what they think they can or cannot do! They become entrenched in limiting thoughts and habits and live their lives, like Thoreau said, ‘in quiet desperation’.


Some people feel that they lack motivation or intelligence or desire or skills. HA! HAHAH! I pity these people. I do. Continually focusing on what they lack instead of what they have at their disposal! How can one gain more by spending his time counting everything he hasn’t! All man needs to succeed he already possesses. The most valuable tool in his arsenal of achievement? Will. What is will? The ability to apply oneself to a decision. We all possess the ability to make a decision. Focus on that decision- never mind the details for they’ll take care of themselves- and you will watch live spring to life. Will! The more you exercise will the more you empower yourself! Have Dreams! Have vision! “Vision without action is a dream. Action without vision is simply passing the time. Action with Vision is making a positive difference.” (Joel Barker)


I want to help other people find their potential. They may ask- what is potential??? What does that mean??? It is everything you are not and you want to be.
I often get caught up thinking that I need to possess the answer in order to plant inspiration within people. How childish! How can I possess all the answers for each individual? Can I make up their mind? Can I pretend to know the depths of their soul and the curiosity of their spirit? No. What I must possess is hope and vision. All I need within myself is the ability to question. To challenge. To encourage people. People have the answers within themselves. They need to look. All I need to to ask the questions that cause people to look within themselves. There they will find the burning flame that starves for more to breath. When this flame catches a breath it will burn brighter and more passionately then they’ve ever known. It will illuminate them from within and their eyes will shine with wonder and awe. They will yearn for more and more and their enthusiasms will cause others to combust in a dazzling display of human achievement.


It’s odd. As I often do, I find myself caught in a paradox of conflicting ideology. On one hand- I hold people to the highest most exalted esteem, adorned and lauded for their precious nature. On the other? I find people utterly reviling, evil and carnal in nature. Lost and complacent with consuming the empty tales of hope. Listening fervently with open ears to the flowery but empty rhetoric that evil spews forth. Lies- deception and deceit. It pulls at the strings of their heart and beckons them to follow but leads no where. Are they sheep? They are defiant sheep. I cannot hate the ignorant. I myself am just as ignorant. I do- however- hate the lies. Those that lead others astray have gained my utmost contempt. Their words are like honey to the lips that poisons and incapacitates. These men lead nowhere.


I love life. I wish I would think less and act more. At the end of the day all that matters is what was actually accomplished. When my life is over- I won’t be able to celebrate the hours of cathartic reflection and quiet contemplation. I will have to show what my life produced. When the harvest is ready- one cannot make excuses for anything less than his best. This life we sow our best, till and prune and water and tend. When this life is over only the fruits of our labor will reveal our success.

I have to work. I have much to do. I have much to write about. No holding back.