Worker A:
Worker B:
I met a union organizer yesterday. He told me that he could get us higher wages, more benefits and better working conditions. All we have to do is unionize our workplace and let the union negotiate on our behalf.
Why would they pay us more than we already make unless the union would help us be more efficient at making more and better widgets? I am pretty good at my job. I make enough good widgets to keep this job – if I didn’t do well enough at making widgets my boss would hire and train somebody to take my place. I know that I may get a different job somewhere else, perhaps for about the same money, making ‘whatchamacallits’; but, I am fairly satisfied or I would have left to make ‘whatchamacallits’ already.
The union guy says that we make the most and best widgets in the world. We have the newest factories and equipment and we are the hardest working and the most productive employees making widgets in the world. Our company is very profitable and we should be more justly paid. He said that if we unionize we could threaten to go on strike and shut the plant down; they would rather comply with at least some of our demands than loose all the money a strike would cost them.
Why would they want to pay us more if they could just hire other people who are willing to work and can do our job at our present wages?
If we unionize, the unions won’t let them hire other people to replace us: That would be against the union rules. If the company even tried to replace union workers the workers from other unions would do what they could to support us as brothers – like not delivering raw materials necessary to make our widgets. The union has other ways to discourage strike breakers if necessary. There is also a natural bias against the companies that make too much money and mistreat their workers.
What will happen to other people outside our union that have to buy our widgets if we can force our employer to pay us more than they would if they were free to replace unionized workers with qualified non-unionized workers?
Who cares, as long as we get our raise!
I do. I just want to know the consequences of our activities beyond ourselves. Let us think this through a bit.
I think that the business would have to make less money on each widget unless they could pass our higher wage cost onto the people buying our widgets. In that case, the consumers buying our more expensive widgets would have less money to spend on the other things they want to buy: So, if I am thinking this through correctly, whenever the business can pass our increased wage cost on, I can understand that my forced increase in pay results in an equivalent loss in the widget buyer’s ability to buy the other things he wants: And, since we get our raise indirectly from the consumer, and since they have less to spend on the other things they want in life, I find myself concerned with ‘what happens to the workers and businesses that make those other things that consumers spend less money on?’ I can see now, that overall, our gain would be their loss and we would be able to buy more of what we wanted while they would have to buy less of what they wanted.
It is also possible that, because our widgets would cost more, consumers of our widgets would buy less of them; hence, the widget business will not be able to employ as many widget workers as before. If that happens, our newly underemployed widget workers will have to go out and get a job making ‘whatchamacallits’ or become unemployed. There would then be more people looking for jobs making ‘whatchamacallits’ causing the overall wages of ‘whatchamacallit’ workers to go down.
Boy, you are a bummer to talk to. You seem to be saying that if we unionize, threaten to go on strike and successfully have the union bosses negotiate a wage higher than the free market would grant us, we hurt ourselves by increasing unemployment in our own union ranks because we would sell less quantity of the more expensive widgets, and/or we would hurt others that have to buy our widgets because they would have less money to buy what they want beyond widgets; and, because they have less money to spend on other things, overall unemployment will increase. It is hard to believe what a little force used to benefit ourselves can do to the overall detriment of society. I am beginning to think that forcing things in the direction we would like them to go might not be such a good idea for everybody in general even if it seems like a good idea for us in particular. It is as though the inefficiency of using force spreads like a disease.
Yes, it does seem reasonable that that could be the natural consequence of violating a free market wage rate. But what if our company chose not to pass the wage increase onto consumers? They would then make less profit or perhaps even lose money. Of course, they could always cut costs from future plant and equipment letting that capital ware out and eventually cease production all together. It is also possible that they could make lower quality widgets; but, then consumers might choose to not buy our widgets at all. Cutting profits below free market rates will also lead to less employment because consumers will not want to buy inferior quality widgets or because it will not be worthwhile for business to replace what is needed to create the widgets in the future.
I can see it now: If our unions force our wages too high our company may be able to eat the increased cost for a while; but, sooner or later, if they want to continue producing widgets, they will have to move their plant and equipment overseas to where labor is less costly; or, new businesses that do not pay the unionized ‘above free market’ wage rates will ultimately drive us out of business – unless we could force some businesses to be union while others are not; unless we could force someone to consume our higher priced widgets, unless we could force different pay scales for people doing the same work.
I suppose so. Even though I can still do my job, even though my skill to do my job is still here, the plant and equipment needed to do my job will leave. I wonder, should we consider working for less in wages to get our jobs back?
Not on your life. Not when we can collect unemployment or work for another business for the same amount of money. We don’t need those low paying jobs here. We don’t need to make widgets anymore.
I think I am going to disagree with you there. It doesn’t seem fair that what would be good for me would be bad for somebody else; but, when the free market is violated it only seems that somebody is better off. It is hard to see that another is actually worse off. The meaning of ‘free market’ is that we don’t force our wills on each other. To the degree that goods and services are not freely exchanged, the exchange is coerced. When one side forces another side into an exchange of a good or service, resentments build up. As resentments build, when given a chance to get even, resentful people may grab for all they can for now knowing that somebody more powerful may eventually come by only to force an unwilling exchange in the future. Resentments breed greed and greed leads to the further destruction of ‘freedom’ itself.
Maury Garvey 8/22/2010
