EKIP– Expert Club for Economics and Politics A Different Opinion
The standard story that the media inundates us with on the occasion of May Day always brings to the fore the resolutely positive role of trade unions in improving working conditions and pay for all wage earners. Even if we put aside, to put it mildly, debatable facts from their history such as violence, destruction of property and outright collusion with criminal structures, the question remains whether unions have contributed to a higher standard of living today than at the dawn of the industrial revolution.
Kalin Mikov
First of all, it should be noted that unions are not productive organizations, they are not engaged in improving the quality or quantity of products and services in the name of the consumer, which is the only way to increase the material well-being of the population. Their task is to convince the worker that his situation can be improved at the expense of the employer, i.e. we see the typical misunderstood Marxist theory of class interests in action. In practice, however, the higher real wages that they negotiate for themselves through pressure leave non-union members outside the labor market or force them to look for work in another industry where the influence of the unions is weaker.
The drastic increase in labor costs can directly bankrupt marginal firms, leaving all their employees unemployed, while the rest are forced to either reduce production or replace the more expensive factor of production – labor – with the now relatively cheaper – capital. Seen in this way, the class interest seems too narrow – members of a certain union benefit at the expense of all other workers, because by protecting themselves from cheaper competition they cause unemployment and an influx into other sectors, which reduces average wages there – solidarity between workers in its full glory.
These patterns, of course, have been noticed by trade unionists. A central element in the attempt to make all working people happy is the minimum wage, regardless of industry or region. The ban on hiring people at a wage lower than a certain threshold, among other restrictions, effectively deprives young and/or unskilled people of the chance to find work, i.e. protects those already employed from competition.
It is very indicative of the understanding of trade unions (and politicians) about the economy that they declare their most sincere desire to create or preserve jobs, not products and services. Hiring or keeping unnecessary workers increases the final price of the product, thus taking away additional income from all consumers that they could otherwise spend on something else. Therefore, the history of trade unions is inextricably linked with opposition to economic progress, to new production methods, due to the fear that people “displaced” by machines will not be able to find other work. However, as the years since the Industrial Revolution have shown, such a danger does not exist, on the contrary - mechanization and optimization free up labor to produce goods that were previously unavailable, thus increasing the material well-being of everyone.
If unions were limited to persuading workers to enter into collective bargaining with employers for higher wages, there would be little to object to, except for the ineffectiveness of this tactic. After all, every individual is free to seek to improve his own situation in any way he sees fit, as long as it does not infringe on the rights of others. The problem comes from the fact that unions take advantage of the repressive state apparatus to push their demands through laws, regulations, and special privileges that restrict freedom of contract and private property rights. We all suffer from this, but the saddest thing is that the poor and the unemployed are the greatest victims of their self-proclaimed defenders, due to their forced exclusion from the labor market.
Very clear and precise 🙂 The only ones who manage to benefit are the union leaders...
In general, I agree, I even think that even more emphasis could have been placed on the criminal connections of the unions, their rather undemocratic internal structures, in which the ordinary worker can rarely think of going against the boss, etc. In reality, it is very rare for unions to win a victory for the worker, in conditions in which, thanks to corruption, basic human rights of workers are really being trampled on, but this only leads to a stronger union, which in the long run harms everyone. I don't know how strong they were before, but in the country where Thatcher dealt with them, every day I am flooded with red leaflets to support the strikes of builders, railway workers, drivers, plumbers, pilots, etc.
Any unions, employers' associations, tripartite groups, etc. are harmful - for the economy as a whole and for the entities within it.
Idiot claims. It depends on unions, laws and human rights. The next few years will see the collapse of Western economies because the system of increasing the cost of labor is not working and the whole fucking world is competing on misery. Both the US and Europe developed in conditions of labor shortages due to emigration and the border effect, but that time is over with the development of other countries and globalization. The share of labor in the world gross product is decreasing, and productivity continues to grow. If wages continue to lag behind, deflation will block the system. Unions are no longer able to increase the cost of labor in time, and income inequality is growing.
The questioner, if he were also an observer, and a careful observer, would see how, before the "collapse of the Western economies" there would be a massive 'fall of the rams' testicles'. Because, it has been proven that capitalism will fall only after the ram's testicles fall. But you are only a questioner, so you will not see either fall.
An important weakness of the unions is that they do not realize that the cause of the crisis is not political and its end does not depend on politicians.
The crisis is due to an unusable non-golden money method of government.
Under these conditions, politicians are doomed victims - the better they fulfill their duties to ensure more economic growth, the greater the potential for crisis and the more significant their collapse.
The failure of Bulgarian governments is due to a perceived dependency.
If the mistake persists - no matter what anyone does, a successful rescue from an escalation of the crisis is impossible.
The current crisis is a childhood disease of a market economy, and to end it requires eliminating the cause.
Ivan Mitev - economist