Labor Economics

Tomu, you don't get it. A corp functioning now, probably one struggling, could pull out the "MADE IN AMERICA" out and emphasize the quality. It would work.

For example, the US textile industry used to be top in the world. Part of the reason for outsourcing is that labor and material is cheaper in other countries, particularly India.

But the other part is that the infrastructure we need to produce fabric hasn't been updated since the Industrial Revolution.

There is a market for American made goods in America. Shipping costs are going up. India and China are starting to demand higher wages. But companies would rather continue to outsource and pass the resultant costs onto the consumer because it's still cheaper and easier than fixing our mills here.

So, the first step should be fixing our mills and factories. We need to update our infrastructure to be more efficient and less expensive. That's the easy part.

The hard part is getting companies to go along with it and agree to offer the product at competitive prices. That's the part where I have no idea how to do it.

In theory, if they could get their advertising team in gear enough, and Americans were REALLY that devoted. But honestly, that's not the shape of the current market. Seriously, what are you talking about? :/

I am very very glad to see wages rising in India and China.

edited 30th Aug '11 10:34:57 PM by TheyCallMeTomu

@Tomu: I think it's a good sign too. That's part of why I think that if we could get the government in on subsidizing the construction of new factories and mills (not the company running it), we could entice people back.

It's getting more and more expensive to outsource manufacturing, and building a new mill is the expensive part. We already have crop subsidies, and the only reason why cotton is cheaper in India, is because their economy is shit.

Tomu's right about the advertising. That's part of why I buy Lucerne instead of Kraft now; it's advertised at Tom Thumb that's local. Has that sign on the shelves with Texas made sauces and a few other products, too. But that's pretty low level advertisement.

Basically, we need companies motivated to pull on American's pride in buying American made (or state made, depending on the scale of the company) products. Appeal to... tradition or something like that.

But it's a lot more complicated than that. Even if India's wages and stuff are still improving, there's also other factors that keep costs lower, such as crap safety standards. Those need more improvement too to get to be as costly to make things there as it is here.

What about a part-time work organization program?

As in, if you work two or more places part-time, and your hours add up to X hours a week or more, the government gives you benefits as though you were a full-time employee. It also provides communication and organizational support to you and enforcement on your workplaces so as to help you juggle two part-time schedules, and to place the onus on your workplaces to harmonize your schedules - they'd be required by law to talk to each other.

We do have something called... Youth Workforce? I can't remember right now. But you can't go there if you're over twenty five, so I'm fucked.

Several things. From the other thread...

Enjoy as our economy collapses into third world status since EVERYBODY could out-compete us globally. The days of the union are long over.

Secondly concerning 30 hour work weeks:

Why? Do you not realize France has never recovered from the pitiful recession that was the 2001 one? Their 35 hour workweeks and 3 weeks vacation REQUIRED BY LAW are some of the reasons why. (The next part is France has more or less legislated away the ability to fire someone even for incompetence/criminal activity, meaning almost nobody hires there on a permanent basis since they can't fire if the prospective employee turns out to be worthless.)

30 hour workweeks in America and more vacation time will result in fewer workers not more. You think the productivity and wage disparity is bad today? Shorten the workweek, it will only get worse.

ITT: Pretending that an economy where labour doesn't have the right to organize and negotiate is healthier.

[Citation Needed]

That post is why think Major Tom is trolling. But argue with the post not the troper.

Why would the American Economy collapse?

Tom, you're making shit up again. Canada has roughly the same amount of vacation and many unions have 36 hour work weeks.

I'm not entirely sure why we're focusing on a 30-hour work week. Number of hours per week worked shouldn't be set. I believe in "get stuff done on time" and so if it takes you 20 hours, done. It takes you 50 hours... then you do that. Most of the time, you can complete everything on time on less than forty hours per week (and substantially less so in creative industries).

America needs to actually produce high quality goods and you could get either government intervention (stamp of approval!) or self-regulation (industry standard stamp of approval!) to ensure quality. As it stands, one of my friends bought kitchen appliances that were "proudly made in America" and the shit broke in a few months, plus rusting and other problems. What a piece of junk. If that's what "made in America" means, no wonder nobody gives a shit it's all outsourced.

Instead of attacking unions, we should be more focused on professionalism within unions. They can police their own members and be concerned about quality. The local trade union where I'm at (as in my geographic location, I'm not a tradesman), you can get fired for poor quality work and high performers get more work than lower performers. Just because you have a made-up "union is evil socialism" view doesn't make it true. Nor do unions lower quality or anything.

edited 31st Aug '11 7:24:42 AM by breadloaf

What we really need is strong protections for union activity. Crush the Hell out of any employer who union-busts: I'm talking jail sentences and asset forfeitures: If the employer tries to bust the union, take the company and give it to the union outright.

It should be coupled with a fair game policy: Whatever the union does to pressure the employer is by definition fair game.

We could get high wages, short workweeks, long vacation times, great benefits... Employers would have to severely limit their profits, though. But that's what the union is for, to pressure them into spreadin' the wealth around.

In short: Make capital flight impossible. Make outsourcing much harder. Make unionizing dramatically easier, and then skin the Hell out of the damn fat cats.

edited 31st Aug '11 12:22:43 PM by SavageHeathen

I agree with the outsourcing because many people in the country need those jobs however call me a person who wants to feed the fat cats but sometimes there are some unions which are unreasonable.I mean unions can be good for the benefit of the workers but their are others that can be just too demananding and self serving.I have also heard of some unions of forcing people to enter their unions against their will.

I am not saying all unions are bad but there some out there that probably need to be busted.While there are unions that can find agreement with the owners to some bit.Just because you bust a union doesn't make the next evil incarnate.I agree there are some owners that have less reasons to bust a union but I don't think they should get jail time because thats overkill.

I mean not all but sometimes the unions can be in the wrong and its the owners that are in the right.Also sometimes all those high demands can't last forever and when it does end then the union will cry tyranny because the owner says those demands are too high.

edited 31st Aug '11 9:35:02 AM by joyflower

If the businessowner is making a profit, no matter how small, the union's demands are not excessive.

edited 31st Aug '11 9:59:41 AM by SavageHeathen

Well, "against their will" is about the equivalent of the power that business has. If you don't like it you can find a new job. It's not optimal, but it is what it is. And ideally the economy should be in such a shape where that's viable. I agree with the main point however, if a large corporation shuts down a location in reaction to unionization efforts, the union should gain control of the assets and be able to run it on a co-op basis. But what about the investors you might ask? Well, the investors are "choosing" to close down the operation (on a representative democracy-esque basis), their interest is pretty much done. At that point the very real investment (in terms of time and energy) made by labor, should take precedence.

Are there bad unions? Sure. But the good ones outweigh the bad ones. Now, I'm actually a yay free market kinda guy. But free markets need to maximize competition by balancing market power. Unions do a good job of balancing market power for labor. Are there other ways? Sure! There are ways I'd prefer. (Mandating and maintaining full employment being my favorite) But it doesn't matter how the power balancing gets done as long as it gets done. I'm no ideologue. Actually, most progressives are really not. We have goals 1 2 and 3 and as long as there is real progress towards said goals, we're happy.

In other words, it would be fair if the Union, for example, drove the company deliberately out of business, or launched a takeover bid of the Company in its own right?

And how do you stop outsourcing? What if the best part is made abroad, and the company doesn't desire to open a factory there?

Even now, I've read of parts for products made for export to the USA being imported to, say the UK, for incorporation into a product sold to the USA (that isn't made in the USA — say, double-deck buses, for example). And that part is made by an American-owned firm...

edited 31st Aug '11 10:05:22 AM by Greenmantle

Of course! The takeover bid should always be the end goal: Worker ownership.

As for stopping outsourcing, it'd be quite easy to do: Make tariffs dependent on where the goods were produced, not where its corporation is chartered.

That should be combined with a free trade with free countries approach: The goal? To brutally punish the companies using Third World slave labor and leave those that do business in free countries unscathed.

edited 31st Aug '11 10:20:30 AM by SavageHeathen

Re: If the company is making a profit-

Nominal profits aren't really equivalent to Real profits. In order for a company to be making real profits, the investment in the company needs to be optimally allocated. Now, what constitutes optimal allocation is a bit complex but basically, it boils down to this:

Are you managing your own company? If so, are you earning more as a result of profit than you would be working for someone else? If no, does the benefit of being your own boss outweigh this lost opportunity cost? If no, you are actually taking a hit to profits.

Even then, your profit margin has to at least exceed real interest rates on, say, T-bills. Otherwise, you're literally making less money by running a business and doing nothing than you would be by just loaning money to the government.

Re: Slave Labor: I'm sure Tom'll looooove me for this, but, you know, those jobs are still better than no jobs-in theory. The only way "sweatshops" are a negative thing is if the firms constructing the sweatshops are somehow using their market power to enforce low wages. That's why I'm so happy to see wages in India rising-it means that the big outsourcers have to go somewhere else for their cheap labor. The only other solution would be... well, mass "population control," which is anti-humanitarian.

edited 31st Aug '11 12:03:55 PM by TheyCallMeTomu

The national minimum wage in the UK has rised by nearly70% whereas RPI or inflation has risen by 30% in the same time period.

Can you explain why prices haven't risen as far as the wage increases?

FAKE EDIT: I love graphs, they explain so much.

Further Fake Edit:

Oh wow, even the Nasty Party can see that the minimum wage wasn't a bad idea.

Copied from another thread

edited 31st Aug '11 12:22:37 PM by whaleofyournightmare

Yeah, regarding the whole "OH NO MINIMUM WAGE WILL RAISE UNEMPLOYMENT" arguments... I'm pretty sure that, despite all the very well grounded theory, the actual statistics regarding minimum wage increases simply don't match the conclusions the theory provides. But I'd like to see some real numbers. Unfortunately, it can be hard to come to conclusions because it's next to impossible to control for all relevant variables.

That may be true but it does show that minimum wage increases are clearly not an important factor in determining unemployment.

At the very least, it would appear that the disincentives to employ workers is offset by other factors.

Or a factor to why people get unemployed.

edited 31st Aug '11 12:59:15 PM by whaleofyournightmare

So, technology is the problem?

Answer: We have eliminate all the technology!

I was going to argue with this, but you're a socialist, so there's no point. You should move to France.

Bleh... unions are supposed to be the counter-balance to business. In theory, they're the same exact thing but for different people and with a different name. Effectively interchangeable, but opposite. Like in math (my head is still ringing from last hour Algebra II/Trig...), you have A = B, with C as the government.

But B does not currently equal A, so we must use C + B to = A. If that makes any sense at all... I'm kind of tired...

He's not a socialist, he's an anarchist... or anarcho-syndicalist.

But I think the problem is the way we allocate resources. Society as a whole doesn't benefit from technology because we give all power to capital holders. So when we roll in new technologies, the common person suffers while factory owners profit. However, the overall benefit becomes negative because so many common people suffer. So then, really a better solution is to figure out a way to have proper rolling employment.

Everyone always complains how unions do nothing but protect their own but I've seen half a dozen different union setups and they're all COMPLETELY different. Like, not even remotely the same. So I really dislike anybody lumping unions together for any sort of discussion.

In particular, there's a union where everybody goes onto a waiting list for jobs (first come first serve). But you can be "name" hired by specific companies if they want you. So you get pulled off the list and go to work for the guy for whatever set contract time. Then, there's a "probation" period... well it's more like a reverse probation period, the company HAS to keep you for x days and then they can decide to lay you off because you suck. So if you're bad, you constantly get a job, do minimum x days, then get laid off and go back to the bottom of the waiting list. Pay is determined by your experience level (and in this case, you might want to add in a merit system as well to reward the better workers... though better workers get more hours and thus more pay anyway). That was a pretty awesome union set up to me and I would say is very good for morale. When you're off work, you're on a waiting list, so they're maintaining as much employment as possible. When you're on work, you have to work hard otherwise you're laid off. Then seniority gives a certain measure of fairness, though I would also throw in merit-base pay bonuses but that's of course hard to manage.