Open-Source Unionism and Labor Scarcity

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Erik Kain

Erik writes about video games at Forbes and politics at Mother Jones. He's the contributor of The League though he hasn't written much here lately. He can be found occasionally composing 140 character cultural analysis on Twitter.

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51 Responses

  1. Avatar James K
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    says:

    Reading the open source article, it sound a lot like how unions work in New Zealand. The short version is that the right to join a union (and the right not to) are both protected by law. Joining a union is a personal choice. Union members have a collective employment contract with their employer and the employer is forbidden from negotiating with them individually. Non-union employees have an individual contract with their employer and negotiate as individuals, but can’t strike.

    The “full employment through monetary policy” article however, was somewhat disturbing. I didn’t realise there were people who still thought it was possible to do that.Report

    • Avatar E.D. Kain in reply to James K
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      says:

      Right, I don’t think it’s feasible at all to work toward a full employment policy. I do think it’s possible to work toward a less unemployment policy, however.

      Interesting re: New Zealand’s unions. Maybe you could expand on that in a post sometime.Report

      • Avatar James K in reply to E.D. Kain
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        says:

        No, it’s not possible to do that either. Mitigating the unemployment increase during a recession is one thing, but monetary policy has no long-term power over economic growth or unemployment. You get drop in unemployment for a year or two, but then unemployment rises again, and inflation rises as well, so you’d have to loosen monetary policy even further to keep unemployment low … and again and again until you have monetary policy as loose as it can get. At which point unemployment rises a lot as the effects of monetary policy wear off and inflation gets really high. This is what caused the stagflation of the 1970s.Report

  2. Avatar DensityDuck
    Ignored
    says:

    You’ll have to deal with the regulatory bureaucracy to get all those small businesses and home-based crafters working, through. The CPSC in particular seems to think that anyone who makes anything is a lazy bastard who’d sell pure lead to children through sheer negligence if it weren’t for them.Report

  3. Avatar Stillwater
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    says:

    The central problem with a theory to boost labor scarcity is that it (by hypothesis) results in higher wages/salaries, which in turn encourages outsourcing of that labor. So here’s my complaint in a nutshell: just so long as capital incurs no penalty in fleeing ‘rigid ‘ labor climates, it will (when the balance sheet says so).

    If that’s right, then the solution to US labor problems is pretty clear: capital won’t return home to create jobs until either labor rates are lower or government creates a disincentive to outsourcing

    Btw, Hillary Clinton proposed something exactly like this during the campaign. I’ve looked but can’t seem to find it.Report

    • Avatar Plinko in reply to Stillwater
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      says:

      I’m pretty sure we already live in a US where capital can move around to find cheap labor with near-impunity.Report

    • Avatar James K in reply to Stillwater
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      says:

      Restricting offshoring would be a mistake, sure it causes specific jobs to leave the country, but those people are being paid in US dollars (directly or indirectly, it doesn’t matter) and that money comes back, leading to more demand for exports.

      Offshoring does not cause unemployment.Report

      • Avatar Stillwater in reply to James K
        Ignored
        says:

        James K: How do you square:

        Offshoring causes job losses in the US.

        Offshoring does not cause unemployment (in the US).

        ?Report

      • Avatar Stillwater in reply to James K
        Ignored
        says:

        Maybe I’m too dense to get it, but you’re argument above seem to be that
        1) Offshoring means less domestic jobs, but more profits brought back into the country.
        2) Those profits increase demand for exports, creating more jobs.
        So 3), offshoring creates US jobs.

        How is that even coherent? And it even appears to be refuted by the evidence: US businesses are sitting on $1.5 trillion in cash, and unemployment isn’t going down.Report

      • Avatar Elias Isquith in reply to James K
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        says:

        I’m not following, either. What role does mechanization play in this system? Why is that money coming back here instead of to China, for example, where the cheap goods are produced? I’m honestly confused — are we talking about trickle-down here? Increased profits for American companies will lead to equivalent re-employment in the long-run because executives and those who have retained employment and enjoyed the benefits of higher profits will want to purchase more expensive American goods?Report

        • Avatar Stillwater in reply to Elias Isquith
          Ignored
          says:

          I thought initially he meant that wages paid to offshored employees would comeback to the US by purchasing US exports. But he said the money comes back first, leading to increased exports. Confuzzle.

          In any event, I think there are conceptual problems here. One is that the (eg) Chinese market would import US manufactured good when they could conceivably purchase Chinese manufactured goods significantly less is a problem. Another is conversion rate of Chinese foreign wage-earners purchases into jobs created by the increased demand. Clearly in a bilateral deal, the the disposable income purchases of offshored employees won’t come close to creating the number of jobs that were lost to offshoring. (The math demands it!)

          Another problem seems to be strictly empirical: the theory seems to be failing miserably. If offshoring actually created US jobs, we wouldn’t see negative job growth for so many consecutive quarters.

          But, IANAE!Report

        • Avatar Simon K in reply to Elias Isquith
          Ignored
          says:

          You’re thinking too hard, Elias. When a US company employs Indian employees it must exchange dollars for rupees to pay them. The people selling the rupees must use the dollars they receive either to buy US exports or to invest in US companies. Either way the dollars end up back being paid to US labor. Thus the specific call center job is lost in the US, but some job is done in the US that would otherwise have been done elsewhere.Report

          • Avatar Elias Isquith in reply to Simon K
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            says:

            Ok. Mechanization of labor, though?Report

            • Avatar Simon K in reply to Elias Isquith
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              says:

              Mechanization moves expenditure from the people making stuff to people making machines that make stuff. In equilibrium, everyone should be employed and we should have more stuff.Report

              • Avatar Elias Isquith in reply to Simon K
                Ignored
                says:

                When are we in equilibrium? And what if $ going to companies that make machines sits in the pile of savings of wealthy? Not trying to be difficult — I’m just not yet clear on how/whether this works outside the textbook or classroom.Report

              • Avatar Simon K in reply to Elias Isquith
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                says:

                We’re never really in equilibrium. But lots of things drag us towards equilibrium. For example, you can’t really make a machine and overcharge for it and sit on a giant pile of cash. For starters, there will be competitors. Also, savings have to be invested. At any given time you may see some firm overcharging for its products, and you may see savers failing to invest in productive activity, but these things do pass.

                There are things that prevent equilibrium. Economists call these “structural factors”. If we’re brutal however, what prevents equilibrium is privilege. When we prevent competitors from emerging, or provide savings vehicles that aren’t productive investments, those things do prevent the kind of equlibrium economists like to think about from emerging.Report

          • Avatar Stillwater in reply to Simon K
            Ignored
            says:

            Thus the specific call center job is lost in the US, but some job is done in the US that would otherwise have been done elsewhere.

            That’s the part where the math doesn’t add up. On the scenario you’re proposing, the disposable income purchases of 1 newly minted off shore employee create 1 US job. But that’s impossible. The only way it is possible is if the disposable income of the offshored employee was greater than the wage of a US worker. But if that condition is met, then offshoring would be economically irrational.Report

            • Avatar Stillwater in reply to Stillwater
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              says:

              Btw, in saying this I’m aware of the multiplier effects, but I’m assuming that the net negative effect for a lost job is roughly equal to the net positive for a gained job in the two economies.Report

            • Avatar Simon K in reply to Stillwater
              Ignored
              says:

              Yes, it not one-to-one. That was sloppy of me. In reality you lose one call center job in the US gain one call center job in India, plus the cost difference which is spent elsewhere. But its spent in the US economy. Total dollar spending is thus constant, and all of that spending is ultimately used to pay US employees. The welfare gain in this situation (verses not offshoring the job to begin with) comes from higher overall productivityReport

          • Avatar Stillwater in reply to Simon K
            Ignored
            says:

            Not to get overly nutpicky about this, but

            The people selling the rupees must use the dollars they receive either to buy US exports or to invest in US companies.

            is not actually an answer to the question but a confirmation of the criticism. Insofar as those repatriated dollars are used to purchase US goods and services, then there is a lift for labor in the form of more demand. But if the money is merely invested in business (or something else) then there clearly is not a lift for labor in job creation. And that, it seems to me, is exactly what’s happening right now.

            And again, IANAE, but the equilibrium you’re referring to seems to me to require US labor rates get alot lower before anything close to increased demand for exports from newly indistrialized countries will reduce unemployment.

            Now, I’m pretty there is something I got wrong in saying that. But what?Report

            • Avatar Plinko in reply to Stillwater
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              says:

              There’s a lot going on above here, but let me point out a couple of things.

              1. You’re operating under the assumption that trade is zero-sum, pretty much all of human history implies that trade is positive-sum. In general, all parties are better of with the trade than without.
              It’s no different than you growing your own food or paying a farmer to do it for you. Yes, you’re giving the farmer money you could have spent elsewhere, but you’re doing it because the farmer grows more food for the same investment you can, so you’re better off, even though you are out some money you wouldn’t have been anyway. With the time/money/resources you would have spent growing your own crops, you can do something else where you’re more productive.
              So, post-trade with the farmer, both you and he are better off, no? So why is it different if we buy things from the Chinese?

              2. Eventually, all international accounts need to balance, it doesn’t matter what they invest in. At some point, those dollars have to flow back to the US. It is quite likely that the wages of many Americans will fall relative to those of other nations and that will spur foreign investment or purchases. A huge of that is because US wages are astronomically high compared to many other places and wages in other places will rise to close the gap.Report

              • Avatar Elias Isquith in reply to Plinko
                Ignored
                says:

                I don’t think Stillwater is interested in this kind of abstract econ 101 stuff. I’m certainly not.

                In plain English, as if I were stupid, explain to me how outsourcing jobs in the economic and political system as it currently exists today leads to commensurate domestic employment.Report

              • Avatar Plinko in reply to Elias Isquith
                Ignored
                says:

                It would be helpful to know the mechanism that you think on balance costs jobs before one could round it back and explore them, because I don’t get what you guys think about international trade as it’s practiced that make it seem negative sum to you.

                Absolutely, the shift in production of refrigerators from Ohio to China has made jobs at appliance manufacturing plants go away. The jobs that replace those are most likely showing up in services – mainly health care, defense contracting and other government spending.
                Some of that money comes from us spending the savings elsewhere (after all, we wouldn’t buy them if they weren’t cheaper), some from the profits that the US companies make being invested in something -either in wages of employees, dividends to shareholders/owners or investments in securities; some come in because the US dollars that flow to China are spent almost entirely on US Treasuries and therefore finance the Federal deficit spending that is doing some small, if insufficient part in propping up employment.
                You and I agree that if the US Government cut $200 billion in annual spending, employment would go down, right? That’s the money from our trade deficit with China coming back to us via Treasury purchases by the Chinese government. We can argue about who’s getting a better deal here, and I would say we are in the long run, of course if we’d spend the money on better investments in our future (education, infrastructure, science research, etc) instead of excessive medical spending and bombing people, we’d be even better off.
                Over time, as we pay off the bonds, the Chinese will just have dollars back (and most likely ones worth less ‘real value’ than they were when they bought them) and they’ll still have to buy something from us with them. I, like you, would prefer that day come sooner rather than later, but the only way to speed it up is either for ordinary workers to take real wage cuts or for the US dollar to fall, and I’m not sure if either of these will come to pass anytime soon from Washington.Report

              • Avatar Elias Isquith in reply to Plinko
                Ignored
                says:

                This was helpful. I’m not even convinced trade is zero-sum — I find the argument that it isn’t to be pretty compelling — but I also wanted to get a bit more detailed explanation of what is often repeated as something akin to dogma. If I understand you correctly, it’s zero-sum for many American workers but only because of terrible policy decisions, i.e., it’s not zero-sum overall — just for them.Report

              • Avatar North in reply to Elias Isquith
                Ignored
                says:

                Well it’s zero sum wrt employment in jobs paying dollars to make things that the Chinese can and will make for pennies.

                On the other hand Americans get a lot of things in return including the workers who lose their jobs. They get very cheap consumer goods with low prices. They get quite a lot of government services (paid for with money the Chinese are essentially giving back to us). They get higher paying government jobs and higher paying jobs in sectors that sell to the government. They get to not be sucked into the problems that’d ensue if China was suddenly a rising hostile power in the far east (being forced to pay for a war with China for instance).
                The list goes on and on. Keep in mind also that the Chinese government, both by purchasing American debt at near 0 interest and also by using their purchasing power to artificially keep their currency weak vies a vies the American currency are in many cases essentially giving their labor to the US at a very cheap rate. The Chinese do this because they hope they can use all this process to modernize and improve their economy and then gradually come off of the current relationship with the US and make a soft landing. If the Chinese succeeded, incidentally, it would also be good for America because an increasingly affluent Chinese society would buy a lot more American stuff.Report

              • Avatar Elias Isquith in reply to Elias Isquith
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                says:

                The only thing that raises my eyebrow is the comments about gov’t services. Especially in light of this weekend’s events.Report

              • Avatar North in reply to Elias Isquith
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                says:

                Well yeah Elias but we’re talking economics, not politics.Report

              • Avatar Stillwater in reply to Plinko
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                says:

                The jobs that replace those are most likely showing up in services – mainly health care, defense contracting and other government spending.

                This is what’s actually happening (or not even that really, since unemployment is astronomically high), but it’s not what the theory says ought to be happening.

                I don’t get what you guys think about international trade as it’s practiced that make it seem negative sum to you.

                It’s negative sum for the US wrt employment: insofar as US labor rates are sufficiently higher than (say) China, and all other things are equal, corporations have an incentive to offshore manufacturing/service provision. Given that the US labor rates are sufficiently higher than those of the newly employed offshore wage earners, employment gains from increased demand cannot (logically cannot) fill the gap created by the job losses.Report

              • Avatar Plinko in reply to Stillwater
                Ignored
                says:

                I don’t think we need international trade theory to explain our jobs crisis. We have huge problems with household liquidity and lots of inefficiencies in the financial, health care and housing sectors (many contributing to that former problem) that are hampering growth and therefore job creation.Report

              • Avatar Will Truman in reply to Stillwater
                Ignored
                says:

                This assumes that offshoring is the reason for our high unemployment. The offshoring has been going on for a long time. Yet until a couple of years ago, our unemployment rate was quite low. Theoretically, if offshoring cost American jobs, wouldn’t the unemployment rate have been rising pretty consistently over the last two decades with one sector after another being subject to offshoring? I mean, offshoring wasn’t invented with the 2008 recession.Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                Will, I’m not assuming that offshoring is the cause of unemployment in these comments (tho I think it is). I’m saying that by the theory itself entails that higher wage-rate countries will experience net job losses as a result of offshoring to lower wage-rate countries (assuming a sufficiently high wage disparity).

                Also, thru the 2000s we had increasing unemployment in very traditional trade and manufacturing sectors in our economy. This was partially offset by increased employment resulting from the housing bubble. Also, an over-reliance on household credit kept consumer spending high, which propped up employment numbers.Report

              • Avatar Plinko in reply to Stillwater
                Ignored
                says:

                I’m pretty sure the theories of international trade expressly don’t say that, so are you referring to some other theory?
                I agree those problems in the second half of your comment but we probably disagree on the cause.Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                Plinko,

                No, you’re right that the theories don’t say that. That’s my criticism of those theories: that by their own lights, high wage-rate countries will experience net-negative job growth as a result of globalization (as we’re understanding the term here, and all other things being equal).

                What are your views on the causes of unemployment during the oughts and the recession?Report

              • Avatar Plinko in reply to Stillwater
                Ignored
                says:

                I think I put them all in my response to Mike Farmer below. In essence, we wasted most, if not all, of a decade on bubbles and borrowed against them. When it all blew up, we decided we needed to punish everyone except the people who caused it.Report

              • Avatar Simon K in reply to Elias Isquith
                Ignored
                says:

                It would be helpful if you could explain why you think it doesn’t, because a few of us have tried to explain and you’re just said “it doesn’t work like that in the real world”, which is precisely the kind of anti-intellectual dodge I’m sure you dislike when conservatives use it in other fields.

                Let me explain again how this is supposed to work, and then I’ll tell you the argument you should be making. When a firm employs someone it has to pay them. When it pays them it has to do it in the local currency. In order to obtain the local currency it has to pay dollars. Those dollars have to be spent – they may be sold first but ultimately you don’t hold on to cash as such. There are only two things you can do with dollars – buy US exports or lend them to US borrowers. So a precisely equivalent dollar value of stuff has to be bought in the US as was bought outside, and since the value of stuff is more or less all labor, that spending goes on employing US labor.

                What you should be arguing is that the fact the amount of money spent on US labor is the same as the amount spent on outsourced labor doesn’t guarantee there’ll be no unemployment in the US. Its not necessarily contradictory for the money to flow entirely to people who are already employed, leaving the unemployed who’d be doing the outsourced job still without work.

                The trouble is that this doesn’t in itself explain why those people are uenemployed. Although the proximate cause may be that they lost their jobs because they were outsourced, that doesn’t explain why they would stay unemployed. The explanation for that has to lie elsewhere – either in structural factors or an overall lack of aggregate demand.Report

              • Avatar tom van dyke in reply to Simon K
                Ignored
                says:

                I think you’re on to something here about the dollar, SimonK, but I’m not sure you’ve hit what it is with the labor thing.

                The US dollar is indeed sui generis, the lingua franca of the financial world; no foreign holder of US debt or dollars benefits from the dollar taking an ass-kicking.

                They all have a rooting interest in the integrity of the dollar. When the dollar starts tanking, they throw some of their dollars into the currency speculation market to save the rest of their dollars.

                So what can they do with their dollars? They tried buying US real estate, but that market tanked, not just now but when the Japanese were “buying up America.” And the Japanese [Sony] bought Columbia Pictures and American creative talent, too, the Jon Peters/ Peter Guber thing, which was a financial disaster.

                The world is stuck with us and our dollar, it seems. Which is just in my mind, since we saved the world 3 times in the past century. Mebbe 4, all while the Euroweinies turned inward, and left the rest of the world to starve. And we’re the world’s oldest continuous and stable gov’t save Britain’s. Where else would any sane man park long-term money?

                We could probably get away with a quadrillion-dollar debt and the world would still just eat it. Whattyathink? I’m thinking we should go for it.Report

              • Avatar Stillwater in reply to Plinko
                Ignored
                says:

                My point is a little bit different than you’re understanding it (or maybe I’m just not making it clear). In the above comments, it was suggested that offshoring results in job losses (in a specific sector), but leads to job creation in other sectors by increasing demand for US exports on a 1:1 ratio. I’m saying that (to my way of thinking) that’s incoherent given the wage imbalances which make offshoring economincally rational (ie. that foreign labor is cheaper than US labor). By hypothesis, those wage earners make less than US wage earners. So job creation from increased demand cannot equal job losses from offshoring given the current wage disparity (if this didn’t hold, there would be no incentive to offshore). The only way the theory works is for US labor rates to get a lot lower. In fact, so low that the only remaining relevant variable would be cost of shipping. (And for many service sector jobs, this is negligible.)

                My other point was that the theory seems to be refuted by the evidence: domestic corporations are sitting $1.5 trillion in cash. Those are repatriated (and domestic, of course) dollars that aren’t going to job creation.Report

              • Avatar Plinko in reply to Stillwater
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                says:

                I think there is a miscommunication here. Part of it may be because of that 1:1 ratio thing. Firstly, no one should say that we gain one job for every one we lose. That’s nonsense, there are lots of jobs making a lot of different wages, even if you assume everything balances instantly (which I don’t think it even could). What is true is that 1:1 they money we spend in foreign nations has to come back to the U.S., how that apportions to jobs is way outside my pay grade.
                Secondly, 1:1 job exchanges is definitely not true in our trade with less developed nations and I think you’re assuming we’re creating one job in China and gaining one new job doing something else. We might be losing one, but in China that might be creating 5 jobs there because worker productivity there is much lower. This is even more clear in the really low wage places like Bangladesh or Haiti, where US wages are 20-30 times higher but low productivity means a plant there might need 10 times as many workers to create as much output as a U.S. factory does.Report

              • Avatar Stillwater in reply to Plinko
                Ignored
                says:

                What is true is that 1:1 they money we spend in foreign nations has to come back to the U.S., how that apportions to jobs is way outside my pay grade.

                Well, I’m way outa my pay grade in the following, but here goes …

                That the money (the dollars) return to the US is sorta irrelevant,k it seems to me. It’s how they are used along the way that matters. Eg., a domestic job is paid in US dollars which are then used to purchase good and services, a portion of which becomes disposable income for the recipient to purchase goods and services, a portion of which … etc. This effect increases overall spending and helps sustain, or even create, demand for G&Ss and raise employment.

                A foreign job is paid in converted dollars which then infuses a foreign economy with those same effects. They gain from the infusion of dollars into their economy instead of us. So offshoring deprives the domestic economy of important multipliers of money use.

                Additionally, the dollars spent on foreign labor/production will return to the US in the form of profits (and costs) that need not be spent in any way on US labor or create any jobs. Those profits could, eg., be spent on land acquisitions, or on capital upgrades in foreign countries, or sit in a foreign or domestic bank. There are many many ways that money could be used that do not include paying US wages or increasing US employment. And this cycle is of course potentially long lasting. So the suggestion that those dollars return to the US seems to me sorta empty, since that money may merely ‘pass by’ the domestic labor market without being used for anything productive.

                Again, IANAE.Report

              • Avatar MFarmer in reply to Stillwater
                Ignored
                says:

                Yes, if productivity and efficiency here in America reduces the need for labor, and if innovation and investment are hampered by regulation, and if businesses in America are afraid to invest in expansion, and if industries like energy production are frsutrated by government policy — yes, that money can sit on sidelines waiting for clarification of the rules of the game and the costs of doing business. But these are different problems.Report

              • Avatar MFarmer in reply to Stillwater
                Ignored
                says:

                The bottom line is that government intervention in the economy causes unintended consequences, and when the signals are blocked, capital doesn’t flow to productive sources — we haven’t readjusted from prior misdirection of capital, for many reasons, but most having to do with central planning blocking the readjustment — the Fed mainly.Report

              • Avatar Plinko in reply to Stillwater
                Ignored
                says:

                As above, I think we agree on the analysis of our problems, but you blame international trade, I don’t.
                The problems you mention with what we do with the money we get back. The fact that we spent it on wasteful things means we had bad policies in place, not that we shouldn’t allow people to buy things that were made in other counties.
                Continuing my streak of half-agreeing, now with Mike Farmer, I think bad government policies are a huge problem. However, I would say the problems were bad policies regarding financial regulation that funneled tons of investment money into bets on housing, tons of money spent on blowing up people in foreign countries, cutting taxes for the wealthy, handing out ineffecient benefits for the elderly. On top of that we decided to allow our innovative tech companies to spend all their money suing each other instead of on even more research (or just giving profits to their employees and shareholders). Fed policies are part of one of those.Report

              • Avatar St.John McCloskey in reply to Stillwater
                Ignored
                says:

                Plinko,
                I intended to write a bit more on this topic because I’d like weigh in, but as I don’t have the time at the moment, I just want to say thanks. This last point is very well done.
                Of course thanks to Stillwater and Simon K too! This discussion is a fantastic one.Report

  4. Avatar Brandon Berg
    Ignored
    says:

    Labor scarcity as such isn’t a good thing. What pushes wages up is a high capital-to-labor ratio. Holding capital constant, reducing the supply of labor increases wages, which is good for workers. But obviously there’s going to be a net reduction in total factor productivity, which means that the combined losses of investors (through lower returns to capital) and consumers (through higher prices) will be greater than labor’s gains.

    And that’s just in the short term. In the long term, reducing the returns to capital may impede the formation of capital through lower savings rates, as of course will the higher government spending needed to pay people not to work. In the not-too-distant future we could end up with wages lower than they would have been if we’d just left things well enough alone.

    Besides, with the impending retirement of the underreproducing baby boomers, we’re likely to see a contraction in the labor supply anyway, and all indications are that it’s not going to be pretty. We don’t want fewer people working; we want more ways to employ their labor productively.

    By the way, it’s a bit surreal to see a proponent of the welfare state admit that paying people not to work will actually induce people not to work. For decades, conservatives and libertarians have been saying just this, and the left has been denying it. But I guess they can admit it now that they’ve found a way to put a positive spin on it?Report

    • Avatar James Hanley in reply to Brandon Berg
      Ignored
      says:

      Re: Brandon Berg. I agree with your argument. Too often people treat wages and prices as though they are disconnected, assuming we can increase wages without increasing prices, or decrease prices without decreasing wages.

      Sure we can make nearly infinite adjustments to nominal wages and prices, but in terms of real wealth–the ability to actually buy the goods and services we want–the only solution is increasing productivity. We can enjoy more televisions, computers, etc., now not because of any government policy that increased the real wages of labor, but because of increasing productivity in the production of those.

      Any policy that doesn’t take into account productivity–particularly the policy’s effect on productivity–is only going to work at some very small margins.

      As to artificially tightening the labor pool by paying people not to work, yes, that can be done. But I’m not quite sure of the logic of taxing me to pay other people not to work so that I can make more money. All else being equal, I might be just as well off with the increased competition and the lower tax rate. At the very least, it’s not a free-lunch policy, so a thorough analysis has to consider what the costs are and on whom the costs will fall (in the real world, not in an ideal scenario). Depending on the answers to that some people might still decide to support the policy; but to support it prior to considering that is to base one’s belief on unexamined assumptions that may be empirically invalid.Report

  5. Avatar Kim
    Ignored
    says:

    What are the roles of unions in our contemporary global economy? SIMPLE. Unionize the world. Global Strikes. Make it so that corporations can’t “move cheaper.” Unions, like the corporations they fight, should be bigger than America. What America will do is nice, under your system, but the unions? They fight a larger war.

    We’ve already had global strikes, if you pay attention. Look for more in the future.Report

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