patrick.net

So consumers will have to pay less for stuff because of lower labor costs.

It is a two way street.

Peter P says

So consumers will have to pay less for stuff because of lower labor costs.

Only in Conservative Storyland.

Here in the real world:

http://research.stlouisfed.org/fred2/series/CP

It is strange.

To many people, inflation is bad, except for home prices and labor costs.

What gives?

Wages that circulate among goods & service providers is how healthy economies work.

Incomes being siphoned OUT of the paycheck economy by non-laborers -- real estate rents, health care rents, resource rents, our $500B+/yr trade deficit, and corporate stockholders and bondholders -- kill velocity within the paycheck economy and eventually cause everything to collapse.

"Labor costs" is how everyone actually makes a living, LOL.

Not that wages need to be high per se, but everything needs to be in balance, money that leaves the paycheck economy has to be put back or the paycheck earners will run out of money.

Our system is far, far out of balance now, with the 1% and 5% claiming an ever-increasing share of income, which is, in the end, has to come entirely from the product of laborers -- every dime's worth of wealth in this country has to be created by labor. But laborers are seeing less and less of the value of their output.

http://research.stlouisfed.org/fred2/graph/?g=dEY

Get it now?

Just because wages "inflate" doesn't mean that consumer prices have to go up, either.

We could liquidate the rentiers, instead.

Right to work states also don't have state income taxes.
Who needs Unions to demand higher wages and a higher quality of life?
That was supposed to be Mitt Romney's job.

CaptainShuddup says

Right to work states also don't have state income taxes.

This is patently false. There are 23 right-to-work states and 9 income tax free states. (7 totally free, 2 tax only interest and dividend income)

Not all 9 income tax free states are right-to-work, either, Washington, Alaska, and New Hampshire are income tax free but are not right-to-work.

How can anyone look at a graph of corporate profits after tax and union membership (HINT: Real Corporate Profits are soaring while Union membership is falling) and not see the problem.

You can't compare it like that. NY and CA are Non RTW states, but geographical position makes salaries higher in those states.

Now I know this is pointless to discuss since liberals will cling on to anything, true or false, and trumped it as truth, while never looking at all the reasons for wages/salaries etc...

FortWayne says

Now I know this is pointless to discuss since liberals will cling on to anything

ACtually this is one of the first sensible arguments I've ever heard from you FW. You're correct, unions aren't the only reason pay is higher in major coastal cities. But it's true to a smaller degree in medium size Midwestern cities RTW states versus not.

Nuance man. Unions aren't all good or all bad. But for a black and white thinker such as yourself, complexity and nuance is too much to handle. You need simple answers.

UNION BAD (frankenstein voice) !

One of the reasons houses are cheaper in the south east is that there's less unions in construction. Is that automatically another reason to be anti-union ?

It's so incredibly stupid. How far does the pendulum have to swing toward economic inequality before you get it? Do we have to become basically a third world fascist police state before you finally wake up.

(not that you would wake up. you would be listening to FOx or another propaganda mill tell you what they want you to think the reasons are for your plight. And you would be one of the first to raise your arm with a big Zeig Heil. It's not your fault. It's called an authoritian personality.)

The least you could do is have an open mind and think a little before you just latch on to the first authority that floats your boat.

So sad.

FortWayne says

Now I know this is pointless to discuss since liberals will cling on to anything, true or false

It's gems like this that keep me coming back here.

Peter P says

So consumers will have to pay less for stuff because of lower labor costs.

And consumers will be able to buy less stuff because their primary source of income pays less.

Shit's really cheap in Sierra Leone and Laos though.

thunderlips11 says

And consumers will be able to buy less stuff because their primary source of income pays less.

Shit's really cheap in Sierra Leone and Laos though.

It is a feedback loop. But Market will provide the balance.

Peter P says

It is a feedback loop. But Market will provide the balance.

Yeah, and the balance will be at at an equilibrium point that is bad for EVERYONE.

marcus says

It's so incredibly stupid. How far does the pendulum have to swing toward economic inequality before you get it? Do we have to become basically a third world fascist police state before you finally wake up.

Says the guy who supports government redistributing income.

Irony much?

kentm says

The average full-time worker in a “Right To Work” state makes about $1,500 less annually than a similar worker in a non-RTW state.

I'm also guessing that on average, unemployment is lower in a RTW state. Just saying.

Peter P says

So consumers will have to pay less for stuff because of lower labor costs.

It is a two way street.

No it isnt. All costs are passed along to the consumer. Any savings are generally kept. Not much of the microeconomic stuff applies anyways because all the major throughput of goods are pan-national and oligarchical.

How about this: higher costs of living (mainly high rent/ expensive houses) means less disposable income in a consumer economy.

We are in a slow motion national suicide by stagflation. Costs go up, salaries stay the same or go down, and the housing freaks keep pressing for higher prices.

zzyzzx says

kentm says

The average full-time worker in a “Right To Work” state makes about $1,500 less annually than a similar worker in a non-RTW state.

I'm also guessing that on average, unemployment is lower in a RTW state. Just saying.

You are probly right. RTW is like minimum wage. It increases the average and decreases the size. Both are bad.

Peter P says

You are probly right. RTW is like minimum wage. It increases the average and decreases the size. Both are bad.

But it doesn't work that way. I should be free to not be represented by a union. Yet the union in the Non-RTW states will force me into the union. And if a man does not want to be racketed into the union, he should not have to.

Mick Russom says

Peter P says

So consumers will have to pay less for stuff because of lower labor costs.

It is a two way street.

No it isnt. All costs are passed along to the consumer. Any savings are generally kept. Not much of the microeconomic stuff applies anyways because all the major throughput of goods are pan-national and oligarchical.

Generally savings are reinvested in order to grow a business, because if you are not growing your competition is. You can't invest or hire more people if you don't have the money to do it.

I'm not advocating minimum wage for everyone, but what we have now is unions killing this country. A firefighter making 90,000k a year... might be all right. But the same firefighter retiring at 65 with 195,000 annual pension is a cost society cannot bear at current market conditions.

At the end unions are only about unions and union greed, they don't care if we struggle or die in poverty, as long as they get what they want. They pass tremendous costs onto rest of us that we cannot sustain and end up losing services that are needed by our citizens.

Problem is, everyone benefits from a union. High wages paid to union members drive up the average wages, so even people in non-union jobs benefit.

I remember back in college, my Econ Prof tried this bullshit:

"Wages rise faster for non-union members."

That's true, but it's better to make $18/hr today with 2% raises going forward, than to make $9/hr today and get 5% pay increases for several years until it reaches equilibrium with the unionize workers years down the line. You lost money in the gap period, and the time value of money and all that.

thunderlips11 says

Problem is, everyone benefits from a union. High wages paid to union members drive up the average wages, so even people in non-union jobs benefit.

No, the only beneficiaries here are those well connected in the union. A non union member forced to pay union dues is economically burdened. A society that can no longer afford proper services because of exorbitant union pay is economically burdened.

And with the union structure of seniority and collective decisions, motivation to try hard and be the best is filtered out by creating apathy. And apathy is the most common trait among union workers.

Unions sre rent seekers.

FortWayne says

thunderlips11 says

Problem is, everyone benefits from a union. High wages paid to union members drive up the average wages, so even people in non-union jobs benefit.

No, the only beneficiaries here are those well connected in the union. A non union member forced to pay union dues is economically burdened. A society that can no longer afford proper services because of exorbitant union pay is economically burdened.

And with the union structure of seniority and collective decisions, motivation to try hard and be the best is filtered out by creating apathy. And apathy is the most common trait among union workers.

Even if this were true, it sill beats ass kissing and office politics that you are likely to encounter in a non union shop.

Peter P says

Unions sre rent seekers.

No, because they produce things for their wages.

Workers produce things. Unions is just a collective controlled by a few.