More Unions

Arbitrated profit sharing is the answer.

Seems to me that tight labor markets don't do it. There is a lot of transient labor that flows in to take low end jobs.

I suggest that we need to apply basic standards, minimum benefit requirements, minimum pay scales, basic working condition requirements.

Mr. Kaus also misses the role of the Fed in all this.

No, he doesn't.

After reading Kaus pretty much since he started showing up on Slate, I conclude that he's not writing in good faith. I can't think what worldview would make someone, in one post, write that (legal and illegal)immigrants depress wages for the working class, and, in another post, worry that card check will lead to rising wages for the working class that will cause inflation.

I conclude that Kaus has no worldview; I conclude that he has some other agenda for continuous attacks on weak Democratic/left constituencies.

Raise the minimum wage, restructure the payroll tax, support service industry unions, cap state sales taxes, and increase state sales tax exemptions for necessities.

In the long run per capita GDP would go up if we stabilized or decreased the capita part. Until we figure out that cold fusion trick there's a physical limit to pie height.

And his point is disingenuous anyway. The only directly known cause of inflation is median wages rising faster than market earnings. When the market is skyrocketing, median wages should be too. But even during our last boom when unemployment was historically low and markets we're shooting up, median wages didn't move.

Low unemployment no longer raises wages for the simple fact that business has learned that if you want to keep the money from the fed flowing you have to keep inflation at bay, and that means paying your workers less. Otherwise inflation goes up, interest rates rise accordingly, and the party is over too quickly. That the fed's mission is to keep unemployment and inflation low is laughable since those two goals are self-contradictory. It needs help with whichever one it isn't pursuing. Since Vockler it's mission has changed to: keep inflation low and the stock market high.

Technology replaces skilled labor and reduces its value, which is one reason why capitalists invest in it. Another way capitalists have avoided paying increased costs for skilled labor is to transfer capital equipment to low wage nations. Unions would have very little power to counter these business trends even with increased membership. A change in the rules of how the economy's wealth is distributed, through transfer payments, increased public goods and changes to the oversight of capitalist collectives, needs to be made to counter the effects, both political and economic, of capital accumulation.

Mickey: creating a tight labor market, giving all workers (not just the unionized) greater bargaining leverage

Kevin Drum: he's never explained just how we're going to get to this paradise of perpetual high economic growth and tight labor markets

Oh ye of little imagination. While there is no magic bullet, there are policies that can create a tighter labor market. For example, reduce the trade deficit by reducing the exchange rate of the dollar (i.e. do the opposite of what Rubin and Summers tried to do during the Clinton era, and what Bush has continued to do).

Oh, and we can call these changes 'right to work laws'.

You can have increasing wages without inflation if labor productivity increases. Unions help workers to share the returns of increasing productivity.

Also, require H1B's to be payed 25% more than the median wage; that way we know we're getting the 'best and brightest' and not just cut rate drones.

This is worthwhile idea -- and I've often thought something along these lines might also be workable with respect to the manual labor portion (ie guest worker) of any eventual comprehensive immigration reform. It would be very easily demagogued, however. I can't imagine a law that demands higher pay for foreigners than for Americans is likely to be popular with Joe Sixpack.

A tight labor market does not automatically result in higher wage growth! Certainly not with specialization. I know not 1 fucking thing about how to build a car on a line, I have near perfect stupidity about autos. But the auto-worker is too stupid to understand what I do about being an attorney. Thus if we quick our jobs there would still be 2 jobs and 2 workers but neither could do them.

Also, workers have shit leverage! If the company hates you, they fire you and you are out of work. If you hate the company you quick and are out of work.

eightnine2718281828mu5,

You're batting a 1.000 - all those ideas are excellent ways to improve the labor market. And the "right to works laws" name for them is the crowning touch (not to mention being entirely accurate).

Kevin's "unions, unions, unions" stuff is the knee jerk liberal response, but unions have plenty of problems. I grew up in what was then called a lower middle class neighborhood, which the stereotype says should have been prime union supporter territory. But it wasn't. People realized that a handful of powerful unions were great for the people who were lucky enough to be in them, but a drain on everyone else. That was especially true of civil service unions, as you don't have much choice in what government you patronize.

Probably the best thing unions ever did was make employers afraid that their employees would join a union. As such, they'd treat their employees well enough to keep them from joining a union. As such I strongly support the right to organize. But unions a panacea? Forget it.

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all those ideas are excellent ways to improve the labor market
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Thx! They also lower impediments to new business formation, which I think is critical in the current economic environment.

MNPundit: A tight labor market does not automatically result in higher wage growth! Certainly not with specialization.

Tighter labor markets can mean tighter markets for both auto workers and attorneys. Even if there are fewer jobs for auto workers, a generally tight labor market means it'll be easier for ex-auto workers to find other jobs. While I don't know much about the law biz, I'd be suprised if it didn't help there too. Employers would be more accepting of people changing law specialties, being older, etc.

Historically tight labor markets are not only good for labor income, they have an amazing way of causing employers to put aside their prejudices. In WWI factories hired black people, and in WWII they also hired women.

If the company hates you, they fire you and you are out of work. If you hate the company you quick and are out of work.

And if there's another job down the street, who cares. I've been there - getting laid off on Friday doesn't hurt much if you start a new job on Monday.

What do I consider the worst part of too strong unions ( Read UAW if you want an example ). The drop in quality and productivity that usually follows.

1. Through collective bargaining union jobs are paid higher than the market rate for the job.
2. In union positions, usually seniority is rewarded over performance incentives.
3. Overpaid experienced workers must be protected by making it very difficult to replace them with cheaper, younger, workers.
4. This means you can not get rid of a slacker.
5. Productivity suffers.

I do not want to have collusion among management which can artificially control the means of production and thus suppress wages - neither do I want to have monopolistic unions which start a special class of protected workers. In my opinion, the more open the economy the better off everyone will be. Just my two cents.

Technology replaces skilled labor and reduces its value, which is one reason why capitalists invest in it. Another way capitalists have avoided paying increased costs for skilled labor is to transfer capital equipment to low wage nations. Unions would have very little power to counter these business trends even with increased membership.

I only agree with you on one of these.

First, it isn't that technology replaces skilled labor. It increases all labor. In fact, it decreases unskilled labor more than skilled labor. And the labor that remains has higher productivity behind it. So the labor is worth more. That's not to say that those workers will be paid more. The trend's been the opposite. But that's not because they are worth less. It's mostly because they have less bargaining power, and employers have kept at least all of the benefits of that increased productivity.

As to shipping jobs overseas: if you think about it, that's also mostly about bargaining power.

The best way to increase labor's bargaining power is to let it bargain. Which is what a union does. There are alternatives. But there are no alternatives that don't involve giving workers more rights with respect to their employers.

I'd say Kraus is an idiot, but he probably isn't. He's a mendacious bastard, and that's worse.

Toyota's Japanese workers are unionized. No drop in quality or productivity followed. Labor, regardless of whether it is unionized, engineering and capital have to be managed properly for any manufacturer to succeed, and American auto manufacturers have failed. Failed partly because, unlike their Japanese competitors, they have continued their historical adversarial relationship with their labor force. Perhaps it is because American manufacturers, unlike the Japanese, hire their managers from finance instead of from engineering.

What do I consider the worst part of too strong unions ( Read UAW if you want an example ). The drop in quality and productivity that usually follows.

1. Through collective bargaining union jobs are paid higher than the market rate for the job.
2. In union positions, usually seniority is rewarded over performance incentives.
3. Overpaid experienced workers must be protected by making it very difficult to replace them with cheaper, younger, workers.
4. This means you can not get rid of a slacker.
5. Productivity suffers.

... In my opinion, the more open the economy the better off everyone will be. Just my two cents.

Posted by: John Hansen on 12/30/08

If you take any heavy industry which requires skilled workers, then the union system which protects experienced people makes sense since it ensures the company/industry will have people interested in a life-long career. Offer them uncertainty and the company/industry won't find many people interested in training for years and then getting laid off at the whim of some stupid boss.

You may think there's some loss of productivity, but when you can't even find a workforce then you won't have any productivity at all.

Arguing for a "more open economy" is just another way of saying you're leaning toward or are a Republican/Libertarian who favors less regulation and more crazy economic collapses such as we're experiencing right now.

The only serious problem with the union system is that Republicans have done a lot of things over 30 years to destroy them.