In part 3 we examined the concept of labor as a commodity and
how the market prices labor, and strategies that the worker can use to improve
marketability. Most people on the left, including the Occupy crowd, should be
howling about this concept of labor, ready
to demonstrate how the market doesn’t treat labor the way we’ve defined, and
are therefore ready to dismiss the whole proposition. In this part, we’ll
examine the role of labor unions and
how they inhibit the labor market to the detriment of both the laborers and the
employers who buy the labor.
It was once observed to me that companies that
become unionized usually deserve it. This sage observation reflected the
general sentiment that a company that cares for its workforce, pays them fairly
and provides them with competitive benefits packages usually doesn't have to worry about
collective bargaining.
Unions have their roots in the early days of
industrialization, when the principles of socialism were generally accepted as
a potential solution to some of the obvious problems that workers experienced
in those days. Before industrialization, most productivity was either unskilled or closely controlled within guilds,
which provided an entry barrier to the job market and basically set up each
trade as a sort of cartel, thus protecting it from the pressures of
competition. Acceptance into a guild was by invitation only, and recruits had
to serve an apprenticeship to learn the trade before they could practice in the
market, be it carpentry, weaving, tailor, mason, smith or any other skilled
endeavor.
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