Unions and government have sold out workers

I wrote recently about the GM strike. As everyone else I am glad to see the strike amicably settled. Time will tell if the plan to have the union manage the retirement programs will help return GM and ultimately the other two companies(since they will eventually have contracts based on this one) to competitiveness. This of course is the important point, but the unions like to call the agenda one of fairness.

Unions and guilds have been around for a very long time. This is part of history. The modern union came into being a grew around the time of the first Progressive, Teddy Roosevelt. Of course in those days progressive had a different meaning than today. The workers of that era had a very good claim to needing some sort of cohesive representation. They worked like slaves for very low wages and horrible working conditions. That is not arguable. They had a moral right to want change.

As I look back I don't see the need for representation, I see a lack of competition. This of course could not be solved in a short period so the modern labor union was born. Not long after that the progressives in government saw 'unfairness' in the economy as a whole. People like Franklin Roosevelt saw the suffering of ordinary citizens as something that could be fixed by government regulation. The New Deal was born. Good intentions or not the government now became an entity that could be swayed to help. Along came interest groups. So many suffering people, but still scarce resources. How to divide up the pie? In the minds of the Progressives markets could not be trusted to be fair.

Along the way unions became very powerful, based on the argument of fairness. Travel and communication improved. World competition was greatly injured in World War II. Everyone in America had good times. Union workers could now enjoy the good life. The could share in the prosperity that they saw the executives enjoying. Both management and labor saw a trend that they saw no end to.

Along came the sixties. Foreign competition started to improve and American industry started to get old. Market share started to drop. Under a market concept adjustments would have been made, to keep the industries profitable. The unionized industries could not make wage and benefit changes without going to the unions. At the same time the Federal government progressed in their drive to help struggling people. The Great Society was born. A lot of taxes were needed. These came from already struggling businesses and already struggling workers.

We know that in a competitive environment increases in prices can only be passed along to consumers so far as the competitive markets would allow. Since foreign, sometimes subsidized companies were not increasing prices, our industries could not. These businesses needed ways to stay competitive and needed to reduce prices. Businesses moved to lower cost areas in the south. As the big northern cities started to see reductions in their revenue stream, instead of doing what consumers would do, cutting back their size, they increased a phenomena called class warfare. Now the very businesses that employed their citizens were not being called greedy, evil, money grubbing. (To be sure some of these people were all of those things, for exhibiting the same behaviors that governments regularly exhibit). Remember as business's market share, rarely did salary or benefits to unions workers decline. When such a thing was proposed, we got strikes. These hurt the companies, the workers, and the consumers.

After travel and communication improved more of these plants moved offshore. More and more people are put out of work. Along the way suffering people came to believe that they had a legitimate claim to other peoples money. Federal largesse became the rule. The thought of getting additional education, or starting a business for themselves never occurred or other ways to help themselves didn't occur to a growing percentage of people. Along the same period education got worse and children don't learn about economics, and government like they should. So here we are today, with an uneducated electorate who largely have no idea how supply and demand work, have no idea what our founders believed to be important, but can tell us everything about Brad and Angelina, and Brittany.

We are reaping what we have sewed. Government and unions have not been in conspiracy together, but through similar beliefs, they have given us the same sad outcomes. This condition is reversable, but not until we start to teach people why govenment and unions are selling our their future.