Of Free Market Slaves and the Doomed Capitalist

Some comments from Michael, of Rescuing Providence, touch on basic differences of assumptions and perspectives. The first was to my “Proud to Be Non-Union” post:

I never expected the folks here at Anchor Rising to be pro-union, but the depth of misunderstanding concerning organized labor and the willingness to serve as lackeys to powerful corporate thugs is unbelievable. When will people realize that most of us will never be rich! Our system, once fair and healthy now works against the individual. We are not the “investor class.” Without organized labor we’ll be no better off than the slaves in China. Unions are not the enemy.

Perhaps I’ve a tin ear for this tune, but it sounds as if Michael is expressing doubts that individuals can at the same time be autonomous and substantial. To wit, the only counter to powerful corporations is powerful union organizations (with or without their influence on powerful government). The only way to avoid servitude is to submit to collective management.
My own perspective, as one of those unaffiliated slavish lackeys, is that I have sufficient personal value to my employer to negotiate fair terms; if we cannot agree, then either I am not achieving what I ought or he is not conducting business as he ought. Whichever proves true, artificially perpetuating the relationship would maintain a state of affairs that ought to change. Worse, forcing my employer to give me more than he believes I’m worth will not make him a better businessman; it will lead him to move the burden of his bad practices elsewhere (and with the benefit of my talents).
A company may seek to exploit those workers who are not individually indispensable, but it will seek to capitalize on — and retain — the talents of those employees who make themselves valuable in their own right. But through the dictation of employment terms, a union draws a line between those who are within its fold and those who are not. Unionists present the latter group as too-wealthy executives (or greedy, nepotistic politicians), but the pain of their smaller pie is more likely to be felt by lower-tier professionals and those who are not employed at all (a group that can include former members of the union). In The Road to Serfdom, F.A. Hayek suggested that Nazism was “a sort of middle-class socialism… to a large extent a revolt of a new underprivileged class against the labor aristocracy which the industrial labor movement had created.” I couldn’t help but think of Rhode Island’s current situation when I first read Hayek’s next paragraph:

There can be little doubt that no single economic factor has contributed more to help these movements [i.e., fascism and National Socialism] than the envy of the unsuccessful professional man, the university-trained engineer or lawyer, and of the “white-collared proletariat” in general, of the engine driver or compositor and other members of the strongest trade-unions whose income was many times theirs.

Contrary to Michael’s protestations, to those whose lives are adversely affected by being outside of the union’s embrace, the union is the enemy. And to the extent that we accept his view of employers as the enemy, those folks are only the more without friend. The only way to ensure that nobody is harmed by outsiderdom would be to force everybody into the same group; in other words, to bring about communism. Unfortunately, if our initial premise is that the individual cannot combat the will of those who are more powerful, it makes little sense to consolidate power totally. Those wealthy thugs will find themselves in the best position to transition into powerful positions in a system that will now allow them even more liberty in controlling circumstances to their advantage.
This ties into the reason that Michael is right about communism, but that it is in all of our interests to prove him wrong about capitalism:

Communism in its purest form might actually work, however, nothing is pure and communism was doomed before it got started, thankfully taken down by human nature. Human nature, in my opinion anyway, is what will be the downfall of capitalism. Too few have too much, whether earned or inherited. The system as we know it is destined for collapse, maybe in our lifetime.

The relevant quality in human nature is the inclination to seek improvement of one’s own situation. Communism restricts the majority’s ability to do so significantly, while increasing the planners’ ability. Capitalism, by contrast, is designed to thrive on individual autonomy, so the same quality in human nature asserts itself as restrictions placed on others, increasingly by means of restricting everybody such that those whose advantages place them beyond an initial barrier have freer rein. Regulations — and unions — ensure that the truly powerful are less likely to find themselves threatened by competition, and the remedy is to enable that competition.
I’d note that the complaint of human nature applies backwards in the logical progression to unions, and is visible in another of Michael’s comments to the first-linked post:

I have no desire to defend public or private unions. I only speak of my own experience. My union leaders are not thick necked thugs. Local 799’s president is a front-line highly decorated and respected firefighter and an attorney, our vice-president is a fellow Bishop Hendricken grad, class of ’80 and a class act, our secretary treasurer is one of my best friends, a great firefighter and better rescue lieutenant and a CPA. The image of unions as a bunch of thugs who care nothing about anything but themselves is plain wrong.

No doubt all of Michael’s friends and fellow union members are good guys; I’ve no desire to treat them as Michael treated corporate executives when he lumped them together and called them “thugs.” But note their close-knit nature, as Michael frames it. Note also the other attributes by which he describes them: an attorney, a private-school graduate, and an accountant. These are people who may indeed turn out to be rich, and who are certainly not a misnegotiation or two from slavery. I humbly suggest that there’s a disconnect between the union rhetoric and its apparent reality.
Be all of this as it may, I’m among those who believe that firefighters and rescue workers ought to be well compensated for their work, which means that I agree with most of what Michael writes in a final comment:

I could go into detail about the lives I have saved (there are many) and property I have protected but I would rather not. The reason I do what I do and risk my health and my family’s welfare is because my union negotiates benefits that our elected officials would take away in a heartbeat to fund somebody’s friend’s project, create a job for somebody’s cousin or simply line their pockets. As taxpayers we should want the best equipped, staffed and trained personnel available. Instead, the sentiment in business, more for less, has pervaded our public safety agencies. Don’t think for a second that thousands would line up for my job if I quit tomorrow and there was no reward. My job is hard, as I’m sure yours is. I’m not wealthy but I make a good living and have my union to thank. That my living is funded by taxpayer dollars does not make me less worthy. I have no intention of quitting unless things get so bad I can no longer afford to be a firefighter. If that happens, I’ll get by, I always have. I made a lot more money before I became a firefighter.

As taxpayers, we should want the best equipped, staffed, and trained personnel available, which is why I’m not sure that unions are necessary to give them a boost. Under a healthy system, were elected officials to abuse their power at the expense of the security and safety of their constituents, somebody or, in a worst-case scenario, some tragedy would expose their behavior, leaving them open to electoral or even criminal repercussions. Paying critical personnel well below their worth would not be long sustainable.
As we see in Rhode Island, however, the clout of special interests, including unions, keeps our system from being a healthy one. The evidence that leads Michael to speak of the “heartbeat” speed of corruption is, in part, made so — and made to be accepted by way too many Rhode Islanders — by the interplay of powerful forces in the state. If everybody forms activist groups in their own interests, there remains only a battle between groups, all with some degree of sympathy for the corrupt behavior of the others. This is not to say that Michael or any of his coworkers condone or engage in corrupt behavior, but although there is a spectrum along which to balance principle and the insider-mentality, human nature will tend to present a group’s benefit to one’s self as deserved, but the benefits to others from their competing groups as suspect.

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Michael
14 years ago

And all along I thought nobody was paying attention! lol…
My comments, when linked together without context, rather than as responses to other peoples comments which is what they are, change the entire vibe of what I was trying to say.
I believe in man’s (and woman’s)potential to become pure, motivated, self-sufficient and free to pursue whatever they choose. To steal from Ayn Rand, with productive achievement our highest goal. I haven’t completely given up. I have witnessed in my lifetime the landscape from my childhood, the mom and pop stores, customer service, little restaraunts where the owner took care of you like family, the guy next door who lived well as a grocer. Now,we are working for giant corperations. The grocer is a kid working part-time stocking shelves. The restaraunt help are minimun wage cooks who follow recipe cards and couldn’t boil water with out them. Giant retailers have replaced the little places with profit, once honorable, now corrupt as the ONLY goal.
I’ve got to give this some more thought. I’m going to Friday’s to battle the masses for some cafeteria food.
Thanks for all the attention though, things were getting a little dull 🙂

PDM
PDM
14 years ago

A patriot has passed. Aaron Russo, free at last.
http://video.google.com/videoplay?docid=-1584595362217609102

Bob Walsh
Bob Walsh
14 years ago

Justin wrote: “Contrary to Michael’s protestations, to those whose lives are adversely affected by being outside of the union’s embrace, the union is the enemy.”
Wow. “Enemy.” The union as the enemy, because the union adversely affected their lives. Not the bank that gave them the subprime loan (if the bank lent the money, it must be OK), or the toy company that poisoned their kid (but the toys are cheaper when they come from China, lead paint and all – those union made toys cost too much), or the Wal-Mart that wiped out half the stores on main street, or the CEO of their company that pocketed $100 million in annual compensation, but cut their health plan, or the company that cut corners so now they can’t drink water from their well or swim at the beach, or the non-union boss who decided that big cars made more money until they lost half of the market, and a lot of jobs, or, for that matter, the politicians who played games with the pension plans and then blamed the workers when they became underfunded, or the boss that fired you because your kid was sick and it was potentially going to impact the health care plan (but you can’t fight it because you have no union.)
Wow. I guess it is easier to blame all your problems on the person you see every day doing a bit better than you than the person (can’t say corporation, because ultimately a person made the decisions) who really contributed to your problems in the first place.

Justin Katz
14 years ago

Wow. Almost 1,500 words of fairly offered argument and explanation and you find it adequate to prance around a single sentence. A single word, actually — “the” — used in a phrase that I took from Michael.
I think any fair-minded reading would see that “the enemy” is not meant to be exclusive in this context, considering that the central point of the post was that individual autonomy and competition remain the best (and most fair) tools for maximizing freedom and spreading profit throughout our society.
To restate two points that I’ve made several times recently without response:

  • Rhode Island’s unions deserve a significant amount of the blame for putting those game-playing politicians in office. (I wonder what the results might be if this notion begins to be batted around among the union rank and file.)
  • Regulations, including those benefiting unions, have helped to suppress the competition that would make mistakes and abuses among corporate executives fatal to their businesses.
Tim
Tim
14 years ago

Michael,
So you became a firefighter for the benefits? That is what you said. How sad! Personally I’d rather deal with a firefighter or a nurse or an EMT who’s in their chosen profession out of a passion and love for that vocation as opposed to one seeking out the best Blue Cross and Delta Dental career package. Unfortunately your attitude represents a growing trend in the public safety/medical professions. Fewer and fewer enter these vocations out of a genuine passion for a particular career and the waning quality of service reflects that.
Bob,
Amusing as always but I am curious about one thing though. Why do you liberals constantly tear down Wal-Mart when they provide an invaluable service to your poverty pimp generation by offering low cost goods? You can’t on the one hand support keeping entire generations of American youth (liberal hypocrisy is particulary evil as it relates to the urban minority and lack of educational opportunity) illiterate unskilled and on the government funded entitlement tit and then slam a retailer who offers these same educationally and economically challenged citizens a variety of low cost goods. Hypocrisy!

Michael
14 years ago

What waning quality of service? And why is picking a word or phrase out of a well thought commentary such a popular passtime here. One of the best things about blogs is the discussions that follow the original post, I don’t spend all day writing and rewriting my responses. If you want to be a sharpshooter be my guest, but you would be better informed if you stopped looking for ways to critisize what people have to say and offered some intelligent feedback yourself.

Justin Katz
14 years ago

Tim,
I’ve gotta jump in, here, to point out that Michael states in the quoted comments, and has said before, that he actually took a cut in compensation to become a firefighter. Here, he specifically said that he wouldn’t quit unless things were to become so bad that he could “no longer afford to be a firefighter.” That’s a world away from taking it up purely as an easy way to benefits.

Tom W
Tom W
14 years ago

Relevant to this discussion in fact that today there are really two labor movements: public sector and private sector. Organized labor doesn’t like to talk about this, and the vast majority of the public is unaware of it. In competitive environments, unionized companies over time tend to whither, and often become extinct, because the accumulation of union work rules and compensation schemes renders the employer uncompetitive. Because this occurs over a long period of time, and the union bosses always point the finger of blame elsewhere, employees typically don’t understand the cause-and-effect relationship until it is too late. Just ask the hundreds of thousands of UAW members who no longer have a job-yes their fellow union members who still have jobs, at least for the moment, enjoy extra market level pay and benefits, but that is come from the hide of their fellows who lost her job. Over recent decades private sector workers have come to recognize, at least intuitively, that unions not only can’t protect jobs, they are often the major factor for the loss of jobs. For this reason union membership in the private sector is lower now than it was before enactment of the National Labor Relations Act. Where unions have experienced kudzu-like growth in recent decades has been in the noncompetitive arena of the public sector. Even FDR opposed unionization in the public sector because he recognized the dangers of organized labor in effect electing its own bosses, whose revenue stream is not derived from a voluntary exchange of goods and services, but from compulsory taxation. In return for union support during the 1960 election, JFK signed an executive order allowing unionization within the federal government. Many states soon followed suit with their own versions; here in Rhode Island by statute circa 1966. As we well… Read more »

SusanD
SusanD
14 years ago

“and then slam a retailer who offers these same educationally and economically challenged citizens a variety of low cost goods.”
Not to mention offering them the employment opportunity that corresponds to perpetuation of the victim mentality.
This would be a good point to bring up this comment by Robert Walsh:
“We have more poverty in Rhode Island, and deal with it charitably”
So NEARI has made the determination that they will not oppose the exceedingly generous social programs offered by the state of Rhode Island – programs which both encourage bad decisions by individuals while diverting funds from other obligations such as public employee pensions.
My question is, were all members of NEARI consulted prior to the formulation of this official stance? It is difficult to believe that, quoting Justin, they do not correctly see “Rhode Island’s welfare system as a competitor for overdrawn state and local funds” or that they agree with the funding priorities of the General Assembly. The right thing to do would be for leadership to poll membership on such an important matter. They might, in fact, appreciate their union leaders conveying their views to the G.A.

Tom W
Tom W
14 years ago

Wal-Mart is the present whipping boy under the “Marx-Goebbels Communications Manual v.1.” The left ALWAYS wants to designate an “enemy” upon which to rile up and focus the anger of their demographic (analogous to the “hate minute” in Orwell’s “1984”). In the case of Wal-Mart, it provides a vehicle for a “coalition” of leftie groups to each “mobilize” (and solicit contributions from) their individual constituencies: environmentalists, Democrat politicians, labor unions. As to the unions, much of the anti-Wal-Mart effort is classic “corporate campaign” organizing. These “organizing” campaigns don’t try to convince employees that they should join a union, but rather to “organize the employer” in order to get it to consent to its employees being organized, using a smear campaign against the employer – essentially a variation on a protection racket: “allow us to unionize your employees or we’ll demonize you with a multi-year public relations smear campaign intended to destroy your company’s reputation.” Unions also try to “take wages out of competition.” They attempt this by either organizing the employer, or attempting to drive it out of business (or in case of a monopoly like public education, prevent competition from arising, e.g., opposing vouchers). Unions will also initiate (or have others initiate on their behalf) complaints to regulatory agencies (such as OSHA), discrimination complaints, etc. Typically these are exaggerated, if not fabricated. Anything legitimate or illegitimate to harass the company. One example of this was Food Lion. A union engaged in a corporate campaign against it planted a story with 60 Minutes that it was repackaging expired meat. This was later proven to be fabricated – but not until long after 60 Minutes ran its story. The leader of that union even said publicly that its intention was to either organize it or put it out of business (and… Read more »

Michael
14 years ago

I do not know the salaries of my friends in the private sector. It is not my business to scrutinize their benefit package. I do know that they work as hard as I do making a living. Some of them are doing better, some not as well. We are all getting by. The struggling economy has made us all aware of our financial vulnerability. As salaries and benefits stagnate, resentment grows. Through the ups and downs, my financial situation remains steady. For years I watched as others reaped the rewards of a strong economy. Nobody noticed or cared about my pay and benefits. My modest income paled in comparison to those in the private sector. Now, my pay and benefits are front-page news. Cities and towns are facing budget deficits: the unions are to blame. Headlines and letters scream, “The party is over! The bleeding must stop!” If I didn’t know better, I would think the state is full of impoverished workers with no benefits at all! I am a firefighter. I have a good salary, great benefits and an exciting job. I will not apologize for it or willingly give it up. Seventeen years ago I was accepted into the Providence Fire Department’s 42nd Training Academy. The competition was fierce; thousands applied for a few positions. I never considered myself better than the thousands that didn’t make it. Throughout the rigorous testing procedures it was found that some of us have the potential to be better firefighters than the rest. We were hired; the others went about their lives. I know some great people that did not get hired. They are leading productive lives in other pursuits. I knew I would never get rich being a firefighter but the benefits provide my family with security. Had I not become… Read more »

Bob Walsh
Bob Walsh
14 years ago

One minor point to SusanD – My comments are my own on this blog, and unless I specify otherwise, they do not necessarily reflect the views of NEARI, or Working Rhode Island, or Ocean State Action, or any of the other 20 or so organizations with whcih I am associated. Gotta love that First Amendment!
That said, speaking from my capacity at NEARI, yes, we poll our members, and get feedback on a wide range of issues. Suffice to say, the majority of our members support labor and programs that help children. No surprise there.
By the way, I just assumed that the folks who dominate this particular blog had realized by now that they do not represent mainstream thinking in Rhode Island. Fortunately, the majority of folks in Rhode Island support labor unions, and they support programs to help those most in need. Do any of you truly believe otherwise?

Justin Katz
14 years ago

Well played, Bob!
“Let me respond to what’s written here with a minor point… and then I’ll move on to an attempt to redirect the conversation away from topics that I don’t wish to address.”

SusanD
SusanD
14 years ago

“One minor point to SusanD – My comments are my own on this blog”
My mistake; I thought Justin was quoting from a newspaper article.
“the majority of folks in Rhode Island support labor unions, and they support programs to help those most in need”
Again, there’s that blurring of the line between public and private sector unions. I won’t take the time and space to reiterate these critical and significant differences; others have done an excellent job distinguishing the two.
As to the second part of that sentence, there is a world of difference between helping someone in need and a social program which has created generation after generation of people who make bad decisions, decisions which disadvantage them personally and their children by aspiring them only to receive government funding for five years.
The continuation of this destructive cycle: isn’t that the truly heartless budget choice?

Frank
Frank
14 years ago

>> By the way, I just assumed that the folks who dominate this particular blog had realized by now that they do not represent mainstream thinking in Rhode Island. Fortunately, the majority of folks in Rhode Island support labor unions, and they support programs to help those most in need. Do any of you truly believe otherwise?
Absolutely! The only people who support labor unions and the poverty industry are those who directly benefit from them. The majority of working Rhode Islanders are not benefiting at all from overly generous union compensation packages or handouts to the poor. A better question might be why in the world any responsible hard working person WOULD support these groups.
Isn’t this analagous to assuming that most of America doesn’t have conservative values? Yet considering the stunning success of conservative talk radio and the utter failure of liberal talk shows it suggests the country’s sentiments are not with the unions and not with a socially liberal agenda.

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