Killing the goose that lays the golden egg is one of those old fairy tales for children which has a heavy message that a lot of adults should listen to. The labor unions which have driven the makers of Twinkies into bankruptcy, potentially destroying 18,500 jobs, could have learned a lot from that old children's fairy tale.
Many people think of labor unions as organizations to benefit workers, and think of employers who are opposed to unions as just people who don't want to pay their employees more money. But some employers have made it a point to pay their employees more than the union wages, just to keep them from joining a union.
Why would they do that, if it is just a question of not wanting to pay union wages? The Twinkies bankruptcy is a classic example of costs created by labor unions that are not confined to paychecks.
The work rules imposed in union contracts required the company that makes Twinkies, which also makes Wonder Bread, to deliver these two products to stores in separate trucks. Moreover, truck drivers were not allowed to load either of these products into their trucks. And the people who did load Twinkies into trucks were not allowed to load Wonder Bread, and vice versa.
All of this was obviously intended to create more jobs for the unions' members. But the needless additional costs that these make-work rules created ended up driving the company into bankruptcy, which can cost 18,500 jobs. The union is killing the goose that laid the golden egg.
Not only are there reasons for employers to pay their workers enough to keep them from joining unions, there are reasons why workers in the private sector have increasingly voted against joining unions...
As a college dropout I'm not armed with certification of my superiority, so, I can only offer my words. They'll have to struggle on their own.
If I outsource work to a company that provides labor services, it only seems right that I would negotiate, define jobs, pay, evaluate, etc., and deal with my outsourcer company as a company. I am dealing, however, with another business. Myofficebuilding is buying cleaning services from hiscleaningservices, etc.
If the company I own has a need to fill individual jobs, i.e., clerk, machinist, bottle-washer, etc., and I advertise for and hire individual people for the individual jobs, it stands to reason that I would negotiate, define jobs, pay, evaluate, etc., and deal with the individuals as individuals.
If one day these people all march into my office and announce they've decided they are stopping work completely in an effort to extort more money out of me, it stands to reason that I would be well within my rights to fire them all, temporarily close the store and hire all new employees. This is because nowhere did each of them and myself agree, when I hired the individuals, that I would deal with them as a unified gang. They all knew that each of them had their own job and employee relationship with my company in terms of duties, evaluation and compensation. And there's this weird old legal tradition called a contract. And something about an agreement made under duress not being valid. Seems sensible, right ? Someone holds a gun to my head and says "sign". Am I gonna play Jack Benny ?
The big evil corporation, a.k.a., the Robber Baron... (cue music)
In the old days, society was much less mobile than today. Moving to a new town meant establishing a reputation. It could be, in some small towns, difficult for strangers to find a room, cash a check, etc. So in the case of one big company having a "company town", employees, one could argue, were unable to quit a job they were unhappy with and pick up and move and find a new job. This put them in a difficult situation and subjected them to "terrible" working conditions that "heartless" factory owners would impose on them. Trouble is, that argument, neglects to mention the fact that life in general was extremely rough compared to today, and even in "good" jobs people would work six days a week and more than 8 hours a day. Farmers (most of the population early on) were used to working very hard with only Sundays (the Lord's Day) off, and society functioned in all segments with hierarchical, paternal authority, which was accompanied by expected mutual respect and responsibility by all decent people and even in some form by the less polite parts of society.
Very few decades ago I worked from before the time I went to school in my father's machine shop; the first machine I remember was a tapping machine.
I know what it's like to do excruciatingly boring and tiring work for long hours, and watch the minutes on the clock tick by. I'll never give a cr@p about a goldbricker's whining because I've experienced the blessing of hard work and it's just part of life.
It is wise - and should be considered normal - to have an industrious, thrifty and respectful population. There are always idiots and wiseguys that are fired because they idiotically do dangerous and counter-productive things. If they keep getting demoted and wind up floorsweeper, and can't manage to do that, they're out the door.
Everyone paid piece work back in the day. My mother could do several times the production of a typical worker: if the average was 1,000 parts per day, she'd make 3,000, and all safely with no rejects and without damaging the equipment. This and my own experience is clear evidence to me that productivity varies.
Norma Rae to our rescue (but she failed Econ 101)...
Unions repeat the worn-out lie that fools so many people: same pay for same work.
The intelligentsia of America should understand simple arithmetic, logic, physics, human characteristics, etc., enough to understand that there is no way on God's green earth that everyone will have the same productivity level. Anyone with half a brain knows that individual productivity varies - even a given person's productivity typically varies from day to day.
Now, I don't need to be a Biblical scholar to understand God's law word enough to know that if Johnny, at the end of each week, makes 50% more production than Bobby, then Johnny has to see something extra in his pay to compensate him for higher production.
Immediately when "same pay" is implemented - what do you get ? Same work ! Most people are employees, so their mind focuses on the word "pay", not "work". The business owner finds out though - every employee's productivity magically gets to be as close as possible to that of the least productive employee. Everyone can catch on to that situation: why would I do any more than the other guy if we're being paid the exact same wage ? And the slow guy simply can only go as fast as he can go.
The very idea of "same pay for same work" is a subversive weapon that wreaks havoc on the nation's productive capacity.
*********************** commercial break
for a fun movie about a very important person in the history of manufacturing...
Watch the 1950 movie
Cheaper By The Dozen starring Clifton Webb and Mryna Loy
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Contrary to the subversive myth, increased productivity does not put money only in the employer's pocket. It makes employees more profitable (lower cost relative to output) to employ as well. As long as employees are mobile, wages will then tend to increase. If there is competition in the marketplace for goods and services produced, as productivity increases, lower costs will push prices lower. Voila - productivity increases tend to cause higher pay and lower prices, or what you and I would call an increased standard of living. Exactly the opposite effect of forcibly extracting higher wages while lowering productivity, which results in a decreasing standard of living.
Back to our poor, tired huddled masses that worked in factories under such "terrible labor conditions", their life stories did not all end like the labor textbooks say. They leave out a whole bunch of stories. People who worked at low-paying, menial jobs, under bosses who wanted good work done, lots of it, and save your smart alecky comments for the street (capable men with jobs to do don't care to hear that). And guess what these people did. They did change jobs. They did pick up and move. Story after story, time after time, family after family. We move to here, we moved to there, pappa got a job here, poppa opened a little shop there.
Reading list...
The book Titan (I need to read it with a few grains of salt) generally gives great insights into Rockefeller, Sr., a man vastly misunderstood (if one is not congnizant of Christian doctrine many of his motivations can't be accurately understood). The man started out as a clerk in a store and did not inherit wealth to get started. He earned the respect of his employers and the business community as a young man and was only able to get started because of his frugality and attention to detail. I can't recommend that book enough for those interested in the history of business.
Another guy to read a biography of, of course, is Carnegie, who started out with literally a few bucks in his pocket. He was a telegraph delivery boy who had the sense to start paying attention to what was going on while he worked.
The Greatest Wealth Accumulation Story, back to Econ 101...
But for every very wealthy person who rose out of poverty, there were countless thousands who merely rose to the middle class. They simply were not enslaved to consumer debt if they managed to save and invest. Consumer debt that induced the working poor to enslaving themselves to it in those days was, of course, the customer account at company and other stores. The idea of people having a right to uncollateralized credit was a 20th century invention that has lured millions to be trapped in a spiral of spending and debt.
I think it's obvious business owners are not all identical and will function as employers with varying degrees of likability from an employee's standpoint. Of course, the worst employers sometimes do such nasty things that one could well understand their employees forming into grumbling gangs. So while I don't condone unions, I understand where they came from. But they are the agitator-inspired band-aid for the symptom of the true problem to be fixed: the dysfunctional business. Think about it (way back to business 101 in the hazy past)... let's see... who is supposed to tackle dysfunctional business correction. Hmm... we've got a free enterprise economy... Anyone ?... Anyone ?... Bueller ? Right - competition. That rascal. Dadgumit. So if we have a company town with a gargantuan factory and no other employment opportunities...
If we instead had dozens or hundreds of smaller companies that each had a factory... golly, they'd be competing for the most productive employees.
Now what of corporations viewed as people, shall we all cry a tear if things can't be our way ? In some ways they logically must be viewed as a legal entity; the only reason to have them is to limit liability associated with a particular business endeavor to that endeavor. If I own an ice cream store, a farm and a roller rink, and have differnet partners in each - they are treated as separate entities so that the farm having a drought doesn't bankrupt the profitable ice cream store and the break even roller rink along with itself.
A corporation can open a bank account and so can a person. But would it make any sense if your ex's corporation sues for custody of your child ? Well, dear, I don't want custody, I don't want you to have custody, let's let the company raise our child.
May we heed the word of God and be humble...
Ecclesiastes 9
"14 There was a little city, and few men within it; and there came a great king against it, and besieged it, and built great bulwarks against it:
15 Now there was found in it a poor wise man, and he by his wisdom delivered the city; yet no man remembered that same poor man.
16 Then said I, Wisdom is better than strength: nevertheless the poor man's wisdom is despised, and his words are not heard.
17 The words of wise men are heard in quiet more than the cry of him that ruleth among fools.
18 Wisdom is better than weapons of war: but one sinner destroyeth much good."