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Unions

I want to pose a question in an effort to state the obvious.  Why is it that when business people get together to push forward their interests they are called the Chamber of Commerce or the Better Business Bureau?  But when working people get together to do the same thing, they are called communists or socialists?


13 comments

  1. mpash says:

    Inappropriate semantics and poor public realtions. The key word, replacing employee, wages, labor, worker with customer or client!

  2. Michael Hartwell says:

    Let me give this a try:

    The bookend to a chamber of commerce would not be a union, it would be a charity or PAC like Physicians for a National Health Program.

    The purpose of a union is to protect workers from the effects of supply and demand. A Chamber of commerce doesn’t set the local prices, but an oligarchy does.

    Both unions and oligarchies are a form of collusion, where its members want to set their profits higher than the invisible hand would set it.

  3. Eric says:

    Michael, I would respond by saying that belief in an invisible hand is precisely that, belief. I have no clue what an invisible hand is. Nor do I believe in the ‘magic’ of the market.
    Classic capitalist economics says that we have a three-legged stool; raw resources, labor and capital. Of the three, capital is the most sacred. Resources and labor serve only to be exploited by capital. There are a couple of problems with this theory.
    First, the assumption is that the most important entity in a capitalist system is the owner of capital. I would argue that there is no capital without labor and that labor is more important than capital. If we attached more importance to labor than capital we might then be able to save the capitalist system. Because, second, we live in a finite world. Capitalism has to have continues growth in order to make more return on its money. The system is fundamentally at odds with both labor and resources. If an economc system serves only capital, than why should it exist? If it cannot better the lives of citizens than it is a system that no longer serves a purpose. And I do think we are arriving at a decisive moment. Can we continue with this trajectory of growth and exploitation? Does labor have no rights whatsoever? Do I only exist so that capital can have a higher rate of return? Are resources only to be exploited until they exist no more? Then what? Is common sense supposed to take a back seat to an economic world view that has more to do with belief and religion than real world? Doesn’t the “invisible hand” sound more like a god than truth? At what point do we realize that an economic system built on the belief that greed is good might come back and bite us in the ass? Just some questions.

  4. mpash says:

    Thanks for your discussion on my blog. You made some economic comments that will take some extensive discussion. I will try to take one point at a time. In general the discipline of macroeconomics is in its infancy! This is why there is so much confusion in the public. Let’s first discuss Adam Smith for awhile. He was a philosopher and wrote Wealth of Nations over 235 years ago. This book was over 900 pages and somewhere in the 700’s, he had this sentence. It has some validity but is blown way out of proportion! His treatise (pin factory) was micro economic and then many economists drew the conclusion that macroeconomics is the sum of many microeconomies which it is definitely not! He was liberal in many of his ideas. He was against monopolies and under paying labor as he was aware that they were the customers and the social and community unrest caused by poverty.
    The major failure of Smith, Keynes and other macroeconomist is there immature understanding of what money is and its narrow distribution only thru banks.
    The concept of having a free market for labor is macro economically incorrect. We have seen this in history from 1865 onwards highlighted by the depressions of 1930’s and 2008. We are microeconomically so productive that we need fewer and fewer employees to produce the goods and services for consumption. This results in demand collapse because there is nobody who can afford to buy all this out put. The current economic climate is a perfect second example of this. Millions of jobs paying $20 per hour left to Asia at $1 hour. Borrowing took its place. Now China has no customers because we can not borrow and their workers can’t buy anything. Tens of thousands of Chinese firms have gone bankrupt because of no domestic demand to replace their U.S. and Euro. customers! Unions help overcome this flaw in Capitalism. What happens in the year 2129 when these companies run out of cheap labor countries??
    We are all in this together labor-customers, raw materials-environment, capital-money. None of these factors can overly dominate or we have collapse. I believe we have all the answers, we just need to implement. But, the major problem has been the monetary system. Read my web site’s The Monetary Solution”
    Thanks again for your discussion!!

  5. Eric says:

    Let’s look at the present crisis. The underlying problem is that Wall Street is completely disconnected from Main Street. On Main Street labor is not a commodity, it’s a necessity. The owner of a business cannot grow his or her business if he doesn’t have employees to work. There can be no profits without employees. Wall Street doesn’t care. They live in a bubble world. For them, labor is a threat. Labor should just shut up and be grateful for whatever is given to it by the elites. Resources are to be explolited and used without any thought to consequences or long-term shortages. In other words, capital has become so disconnected from the real world that it lives in a fantasy. There is no connection to anything that isn’t traded for a profit. The problem isn’t micro or macro enconomics, it’s the corporate mentality. Corporation exist only to make a profit. To think that they have any morals or ethics or have the interests of anyone but management and stockholders at heart is plain naive if not just stupid. I’m not certain civilization can survive without bringing coporate think under control. Adam Smith alway argued that capital had to have a social consciousness. The new capitalists, the nuvo riche (?) that came out of WWII have no social consciousness. They think they know all truth and all truth is based on wealth and who has it and unlimited resources. That is the real problem. A right-wing world view built on ignorance.

  6. mpash says:

    I agree on most of what your saying. Let us discuss some of the solutions and vocabulary.
    1. Corporate mentality and control is macro economics.
    2. The word corporation should be preceded by the word large corporations. Many small businesses are corporations.
    3. Businesses are geared to make a profit and should be!
    The solution is the right Government to off set the flaws of commerce:
    1. Enforce and improve the ant-trust laws.
    2. Improve shareholder rights and voting.
    3. Change corporate tax and other regulations to encourage long range planning and profits instead of short range-stock market profits.
    4. Encourage even more ownership by the workers and others.
    5. Encourage more Corporate Responsibility.
    The solutions for Wall Street:
    1. Re-institute the Glass-Steagall Act. Banks who have the power to create money should NOT be allowed to compete or own other firms.
    2. Enforce and improve the anti-trust laws.
    3. Always improve oversight and regulation with minimal bureaucratic interference.
    4. Recreate usury regulations-especially for credit cards.
    5. Diversify the money creation delivery system. It is only with the commercial banks.

    You might think of more tactical solutions. My goal in this website is to substantially improve our current system of commerce before it does destroy itself as Wall St. just did. We did have many of these long range regulations and laws in place and were still improving them until the Republican-Laissez-Faire-Libertarians came to power. They still do not believe in government involvement in the economy (macroeconomics) even after all the historical evidence and economic improvements over the last 60 years! I believe in the right government involvement.

  7. Mpash, as the resident expert I’d like to read your reaction to Eric’s skepticism of Adam Smith’s Invisible Hand – that markets are efficient in producing needed resource, and that supply and demand determine price. I find this to be a pretty big assertion and I wish the conversation hadn’t strayed.

    In addition, back to the original point, does anyone disagree with my labeling of unions as a workers’ cabal?

  8. mpash says:

    Thanks for the follow up questions. As I mention in my last entry the silent hand has validity but as I discussed in my website, human commerce is not perfect. They fail to plan for long run profits to get lower but quicker short term profits. An example is the acquisition of natural resources failing to price in the cost of disposal and damage to the environment. The disposal of industrial waste is quick and cheap just to dump it in the water ways. In the long run, this kills the customers and food sources. The theory of supply and demand is an explanation to describe pricing decisions. There is elastic and inelastic supply and demand. I have seen supply go down and prices go down. I have also seen prices go up and demand go up. There are many factors involved in the pricing decisions besides supply and demand.
    As mentioned in my website, Unions help overcome one of the major flaws of capitalism, the creation of quality customers by not under paying workers. Are they perfect, of course not. Like all human endeavors, they need to continue to improve. But, they are up against very large, wealthy, and powerful corporations. Businesses have their associations, institutes, and lobbyists. Many of these organizations are very social. Why shouldn’t our customers and clients have the same! In fact, unions have been partially replaced by government with their minimum wages and regulations on working conditions.
    The professor’s site you gave me is very large. Any articles or discussions you would like me to review?
    Thanks again for your questions. They can be a little more specific, if possible.

  9. Eric says:

    A few points and I apologize for not responding sooner. First, years ago I wrote a letter to the editor that asked a simple question: “Why is it that when businesses and corporations get together they are called the Chamber of Commerce or the Better Business Bureau? But when working people get together they are callled communists or socialists?”

    The point is that there is real hatred for working people in the United States, especially in the South. And this is fed by the right-wing corporate propaganda machine. When we debate macro or micro economics, we tend to overlook real world economics which are dictated by power and greed. Capitalism, as it has unfolded, has become more a clarion call to legitimize greed than an economic philosophy. Let’s look at NAFTA. The most important elements, labor and environment, where negotiated out of the agreement with the promise that they would be discussed at a later date. They weren’t and never will be. That was the plan.

    Again, we have to go to the fundamentals of capitalism. Do we live in a world of unlimited resources? Is an economic system built on unlimited growth realistic? Can we continue to sustain a human growth spurt that allows the economic system to make obscene profits for the few? Wasn’t NAFTA the nail in the coffin for working people? Instead of standing up for a universal wage (which is necessary today for obvious reasons) corporations fell over each other racing toward $1 a day labor in China and all places in between. This is the great spiral downward that economists simply refuse to acknowledge.
    And then, the issue of corruption. How did the Glass-Steagel Act get repealed? Pigs at the troth. We learned 60 years ago that investment banks should have nothing to do with consumer banks. Insurance should have nothing to do with equties, etc. We had learned those lesssons. But the corporate stooges, the Republican Party, worked 60 years to subvert common sense. Lo and behold, look what happened! The problem is, once things get back to normal, the same forces of greed will go to work to subvert the system. It is the nature of the corporation. That is the problem. Corporations have been given the same legal rights as you and I but none of the responsibilities. They are generally unethical in the sense that they will change laws they don’t like without any sense of responsibility or accountability. As long as corporations are given the same rights as an individual, I honestly think humanity is doomed. Enough for now.

  10. mpash says:

    I agree with most of your comments. But, human beings are greedy. We need to control this greed because it does not work in the long run. It is amazing to me after 2 major failures-depressions that these Republicans and Corporations can’t figure out that it is in their best interest to pay a “quality customer minimum wage” and encourage gov’t to protect their customers. Many economists differ on their definition of growth. It can be in services not just goodies. Even the goods can be produced in an evironmentally friendly way. The technology is known! Do we have to many people? Are things going to get back to normal? Doubtful. My website is dedicated to educating and correcting these human economic flaws to enhance our survival.
    Let us concerned citizens keep banging on our leaders.

  11. Earl Kaatz says:

    In 1958, a history course I was taking produced a question. How can we, the US,
    produce consumers for our high production
    of goods? Fifty years later, the whole idea seems ludicrous, or bizarre. The rest of the world is milking US dry, money and employment. The first official act I remember by Reagen was the jailing of the Officers of Professional Air Traffic Controllers union, and firing all of the members. All unions have been beaten down since.

  12. Earl Kaatz says:

    When the economic debacle began last
    fall I poked around to see what was said and done in Roosevelt’s day. Quotations
    from economists of the day indicated they
    wondered if the business owners were
    happy to be saving their empty factories,
    office buildings and banks. Taxing the rich
    would not be soaking them, but saving them from their own excesses. Their only profits come from spending by consumers
    sufficently paid for their work.

  13. Earl Kaatz says:

    CEO hiring bonuses, firing bonuses, and raids on employee retirement funds appear to average about thirty million. Does any one know one of those greedy union workers who will be paid thirty million for a lifetime of labor?