Why is FAIR TRADE better than FREE TRADE?

[Loren Pechtel]

Cost of production is just a part of doing business. The aim in most cases being to maximise profits by reducing costs, which often comes at the expense of workers. Workers do better under collective bargaining and wealth is still created.

Which doesn't mean you can just handwave it away.

The capital costs of business have been going up, it's inherent from our increasing standard of living.

Everything has been going up except wages for the average worker. Which does not apply to the big end of town, where wealth has no apparent limits.

And I suppose you measure the height of the average human by attending a dwarf convention.

 

[Loren Pechtel]

View attachment 29971

https://tradingeconomics.com/united-states/exports

What's that got to do with my point?

The point is that exports were flat until the late seventies. Yet you want to give all the credit for the massive GDP numbers to exports.

You can't tell if they were flat or not, there simply isn't enough detail in that part of the graph. Exponential curves start out looking flat.

 

[Loren Pechtel]

It has to be a competitive free market, not just any free market.

Note that fair trade is about applying capitalism to markets that are not competitive.

 

[ZiprHead]

The point is that exports were flat until the late seventies. Yet you want to give all the credit for the massive GDP numbers to exports.

You can't tell if they were flat or not, there simply isn't enough detail in that part of the graph. Exponential curves start out looking flat.

For twenty five years???

 

[DBT]

Everything has been going up except wages for the average worker. Which does not apply to the big end of town, where wealth has no apparent limits.

And I suppose you measure the height of the average human by attending a dwarf convention.

The widening gap between income at the top end and that of the average worker is quite clear.

 

[DBT]

It's not extortion. It's a balance of power.

It's a use of cartel power. The union is a cartel which gains some advantage not by competing but by anticompetitive behavior, uniting with their competitors to fix their price = wage-fixing.

You could also say that price-fixing by companies is not "extortion." It is just an anticompetitive act which makes everyone worse off except those players who gain by joining together to agree on terms rather than competing with each other.

As it stands, it is the employer who has the power to set wages and the employee who has no choice but to either accept or have no income. That is extortion.

No, there's no "extortion" until threats of force are used against the victim. The employer is not threatening you to offer you $1 and say you don't get the $1 unless you do that work. A "threat" to not pay you $1 is not really a "threat" because if such a "threat" is carried out, it leaves you no worse off. A real "threat" has to be something which if done would make you worse off than you already were.

Definition of "extortion" -- "the practice of obtaining something, especially money, through force or threats." https://www.google.com/search?sxsrf...hUKEwjc28Gn_NbsAhVOop4KHWIxATcQ4dUDCAc&uact=5

Nothing to do with extortion.... collective bargaining simply provides a more balanced relationship between workers and employers. Without collective bargaining (or government regulation), it is the employer who has free reign. Look at the history of the Labour movement.

 

[laughing dog]

As for #2--where's the amount going to capital in your data?

Capital is owned by owners. It is an asset of theirs. Your objection is economically ignorant.

No, you're the one being ignorant. It doesn't matter that it's owned by owners, it's not available to spend.

I realize this is difficult for you. Owners choose to buy capital equipment - it was available to spend at one time. Furthermore, capital equipment is a physical asset - it is part of the owners' wealth.

 

[laughing dog]

It's a use of cartel power. The union is a cartel which gains some advantage not by competing but by anticompetitive behavior, uniting with their competitors to fix their price = wage-fixing.

You could also say that price-fixing by companies is not "extortion." It is just an anticompetitive act which makes everyone worse off except those players who gain by joining together to agree on terms rather than competing with each other.




No, there's no "extortion" until threats of force are used against the victim. The employer is not threatening you to offer you $1 and say you don't get the $1 unless you do that work. A "threat" to not pay you $1 is not really a "threat" because if such a "threat" is carried out, it leaves you no worse off. A real "threat" has to be something which if done would make you worse off than you already were.

Definition of "extortion" -- "the practice of obtaining something, especially money, through force or threats." https://www.google.com/search?sxsrf...hUKEwjc28Gn_NbsAhVOop4KHWIxATcQ4dUDCAc&uact=5

Nothing to do with extortion.... collective bargaining simply provides a more balanced relationship between workers and employers. Without collective bargaining (or government regulation), it is the employer who has free reign. Look at the history of the Labour movement.

"Collective bargaining is extortion" is another idiotic libertarian meme that indicates rational discussion is not possible.

 

[ZiprHead]

It's a use of cartel power. The union is a cartel which gains some advantage not by competing but by anticompetitive behavior, uniting with their competitors to fix their price = wage-fixing.

You could also say that price-fixing by companies is not "extortion." It is just an anticompetitive act which makes everyone worse off except those players who gain by joining together to agree on terms rather than competing with each other.




No, there's no "extortion" until threats of force are used against the victim. The employer is not threatening you to offer you $1 and say you don't get the $1 unless you do that work. A "threat" to not pay you $1 is not really a "threat" because if such a "threat" is carried out, it leaves you no worse off. A real "threat" has to be something which if done would make you worse off than you already were.

Definition of "extortion" -- "the practice of obtaining something, especially money, through force or threats." https://www.google.com/search?sxsrf...hUKEwjc28Gn_NbsAhVOop4KHWIxATcQ4dUDCAc&uact=5

Nothing to do with extortion.... collective bargaining simply provides a more balanced relationship between workers and employers. Without collective bargaining (or government regulation), it is the employer who has free reign. Look at the history of the Labour movement.

"Collective bargaining is extortion" is another idiotic libertarian meme that indicates rational discussion is not possible.

“The comfort of the rich depends upon an abundant supply of the poor.” - Voltaire

 

[DrZoidberg]

But unions are essentially cartels, and this has turned them rotten.

The power differential is the key. Unless workers gang together and defend their interests as a group they will be taken advantage of. At some point their will be an equilibrium of acceptable exploitation. The capitalist needs to make a profit. But it has to be reasonable. What is reasonable is set by the market.

I disagree that it's a rule that unions always turn dysfunctional and into cartells. In USA some of them were infiltrated by the maffia who used them as a weapon. In Great Britain the extremely strong coal miners union were bringing the country to its knees economically. But these are exceptions. Usually unions have purely been benefical. In Central and Northern Europe unions have purely been positive to the economy as a whole. The unions and the capitalists are a team working together for greater profits.

The legitimate positive function of unions can be compatible with the principle of competition. It must be recognized that competition is a necessary component of the market, and yet unions mostly disregard this, demanding protectionist measures and other policies which reduce competition, and demonizing foreign production as detrimental to the domestic economy, which it is not. Healthy unionism would be a kind which welcomes all competition, no matter where it comes from, and would make its gains by causing workers to perform their work better and compete better and beat the foreigners by outperforming them rather than by getting the demagogue President to crack down on the "unfair" imports.

I don't think unions disregard this. I think you are just flat out wrong. Yes, I agree on your definition of healthy unionism and I do think that is the norm for how unions function.

Even slavery was a part of the "market" 300 years ago. Not everything going on in the economy, or in the society, is a legitimate part of the system. Some elements within the society go contrary to a legitimate competitive free market system. Including some capitalists. How about a murder-for-hire business. That too is a "part of the market."

Ehe... what? That's completely counter to what any economic theorist has ever said about market economics. Any part of the market, no matter how immoral or dysfunctional, is a part of the market. Whether we like it or not. The acceptance of this is why conservatives often are called calous by bleeding heart liberals. But it's non the less true.

The whole point of conservatism and libertarianism is that the market is smarter than any human. Gaming the market is hard. Yes, murder-for-hire is a legitimate part of the market. Why? Because people are being hired to murder others. It's litterally a fact. So it has to be taken into account as a factor in the free market. No matter if we agree on the practice or not. Our opinions on its morality is irrelevant.

A free market isn't everybody lying down flat and letting the capitalists walk all over them.

No, it's everybody improving their performance so they can compete better. But it's not demanding laws which stomp down on a competitor who sells something at a lower price, like unions demanding anti-dumping laws against foreigners beating them on price, or imposing crybaby "local content" rules requiring products to be 35% or 50% domestic-made. These are crybabies not "lying down flat and letting the capitalists walk all over them," but rising up to crush the competition and make the economy worse and drive up the cost of living for the whole nation, in order to increase the benefit to a small special interest group.

So in a true free market some of the players must yield to the benefits of competition rather than rise up and go to war against their hated competitors and against all the consumers, waving their xenophobic pseudo-patriotic banners and screaming "jobs! jobs! jobs! jobs! jobs!" etc. They'd do the economy better by continuing to "lie flat" and let the country benefit from the free market competition.

Aha... the "true free market". Perhaps found under the No True Scotsman's kilt?

The market is the market. Whether you like it or not. The unions are a part of it. If employers would consistently be nice to their employees unions wouldn't exist.

I work in IT. It's a very human capital centred type of job. Employers have to be nice to their employees. Since it's their brains they are paying for. The physical labour part of the job doesn't exist. So unions in that field barely exists. I'm still for unions. But their necessity depends upon what type of job it is.

A free market is everybody hustling to get a piece, even workers.

Only if they get their "piece" by competing and performing better, not if they get it by running to the government to pass laws to excuse them from competing. Not ALL "hustling to get a piece" is the "free market."

Getting special legislation on your behalf is something we primarily associate with industry lobby groups. Not trade unions. While they do it. It's nowhere near the shenanigens the companies are doing. The problem is the structure of the democratic system works. It's not unions.

BTW, this doesn't happen in Europe (except France). Trade unions have traditionally (except in France) stayed away from this type of lobbyism. Which I think is good.

And "free" has its limit, because it has to be a COMPETITIVE free market, not just a free market where every player is "free" to choose anything no matter what. There can be legitimate interference in the market to force the players to be competitive rather than engage in anticompetitive behavior, e.g., price-fixing. Enforcing competition is a messy part of the free market, but it can be necessary, because serving consumers has to be the ultimate goal -- higher overall living standard -- not simply freedom of producers to do anything they choose. In cases where they choose anticompetitive acts, this is the one instance of "free" choice going against the good of the whole society. So cartels and monopolies and oligopolies have to be deterred somehow, even though this means "free" is curtailed.

This is the main point where Ayn Rand and most Libertarians went wrong.

I agree completely. I also think that Thatchers breaking of the British coal miners union in the 80's was necessary. Any player on the market regardless of if it's on the employer or employee side that is so effecitive in it's hustle that it disrupts the market should be broken. I just don't agree that unions are primarily evil. As a general rule, they spring up whereever they are necessary and disappear when they aren't. Just like how any healthy free market should work.

 

[Loren Pechtel]

Everything has been going up except wages for the average worker. Which does not apply to the big end of town, where wealth has no apparent limits.

And I suppose you measure the height of the average human by attending a dwarf convention.

The widening gap between income at the top end and that of the average worker is quite clear.

You have yet to present the income of the average worker to even make that claim. And your income at the "top" is referring to what a few people at very large companies make, not what the average CEO makes.

 

[Loren Pechtel]

It's a use of cartel power. The union is a cartel which gains some advantage not by competing but by anticompetitive behavior, uniting with their competitors to fix their price = wage-fixing.

You could also say that price-fixing by companies is not "extortion." It is just an anticompetitive act which makes everyone worse off except those players who gain by joining together to agree on terms rather than competing with each other.




No, there's no "extortion" until threats of force are used against the victim. The employer is not threatening you to offer you $1 and say you don't get the $1 unless you do that work. A "threat" to not pay you $1 is not really a "threat" because if such a "threat" is carried out, it leaves you no worse off. A real "threat" has to be something which if done would make you worse off than you already were.

Definition of "extortion" -- "the practice of obtaining something, especially money, through force or threats." https://www.google.com/search?sxsrf...hUKEwjc28Gn_NbsAhVOop4KHWIxATcQ4dUDCAc&uact=5

Nothing to do with extortion.... collective bargaining simply provides a more balanced relationship between workers and employers. Without collective bargaining (or government regulation), it is the employer who has free reign. Look at the history of the Labour movement.

And murder has nothing to do with killing someone.

Labor actions are 100% pure extortion. The fact that it's by the workers is completely irrelevant. If it weren't for the protections built into the law every striker would be in jail.

 

[Loren Pechtel]

No, you're the one being ignorant. It doesn't matter that it's owned by owners, it's not available to spend.

I realize this is difficult for you. Owners choose to buy capital equipment - it was available to spend at one time. Furthermore, capital equipment is a physical asset - it is part of the owners' wealth.

The fact that they chose to spend it has nothing to do with the economics of the situation.

And while it's part of the owner's wealth it's money that has been permanently converted to capital and thus can't be shared with the worker.

 

[DBT]

It's a use of cartel power. The union is a cartel which gains some advantage not by competing but by anticompetitive behavior, uniting with their competitors to fix their price = wage-fixing.

You could also say that price-fixing by companies is not "extortion." It is just an anticompetitive act which makes everyone worse off except those players who gain by joining together to agree on terms rather than competing with each other.




No, there's no "extortion" until threats of force are used against the victim. The employer is not threatening you to offer you $1 and say you don't get the $1 unless you do that work. A "threat" to not pay you $1 is not really a "threat" because if such a "threat" is carried out, it leaves you no worse off. A real "threat" has to be something which if done would make you worse off than you already were.

Definition of "extortion" -- "the practice of obtaining something, especially money, through force or threats." https://www.google.com/search?sxsrf...hUKEwjc28Gn_NbsAhVOop4KHWIxATcQ4dUDCAc&uact=5

Nothing to do with extortion.... collective bargaining simply provides a more balanced relationship between workers and employers. Without collective bargaining (or government regulation), it is the employer who has free reign. Look at the history of the Labour movement.

And murder has nothing to do with killing someone.

Labor actions are 100% pure extortion. The fact that it's by the workers is completely irrelevant. If it weren't for the protections built into the law every striker would be in jail.

It's not 'extortion' because you say so.

Individual workers have very little leverage unless their skills are in demand.

It is collective bargaining that enables ordinary workers a stronger input into wage rates and conditions, which gives the relationship a degree of balance. Without which the employer is able to exploit workers at will (especially in the absence of legislation).

This is about a fairer relationship between the two parties.

Your 'extortion' claim is both emotional and false.

 

[DBT]

The widening gap between income at the top end and that of the average worker is quite clear.

You have yet to present the income of the average worker to even make that claim. And your income at the "top" is referring to what a few people at very large companies make, not what the average CEO makes.

Average wage is not the issue here. The issue is the growing divide between the highest paid and the rest of the workforce. The issue has been described numerous times.

 

[Lumpenproletariat]

A better economy means improving the production, or getting producers to perform better --

-- rather than just scapegoating employers and pandering to a select victim group whining for special attention, thus driving up cost and reducing the production.

A worker's worth is measured by the wealth their labour generates. Workers are not getting their fair share of the wealth they generate....which is flowing rapidly to the high end of town.

Workers are exploited because there is a power imbalance between individual workers and the employer. Which is why unions were formed in the first place.

This reads more like a leftist position piece than actually addressing the issue.

Nothing to do with leftist ideology. You must . . .

What? "Nothing to do with leftist . . ." So then, "exploited" workers not getting their "fair share" and needing more "power" -- that isn't "leftist ideology"? Right, and the Pope isn't Catholic.

You must be aware of the horrendous hours, pay and conditions set at the beginning of the industrial revolution, which was the reason why unions were formed.

And those unions did very little to change the bad conditions. The conditions were already improving gradually before the unions had any power, because it was best for business to improve the conditions. Then, when unions did finally gain power, their impact was to increase the cost of production more than improve the conditions which were improving anyway and would have continued to improve without the unions.

What are workers to do? Struggle financially, . . .

They are to QUIT when the terms and conditions are unacceptable, or not even apply to work there in the first place until there were better terms. This is in fact what happened, and companies had to offer better terms, increase the pay and improve the conditions. Everything to make the work better did happen, as part of the competitive free market conditions, gradually improving the production as this was made possible and necessary in order to keep expanding production and profits.

. . . Struggle financially, work long hours for a pittance while . . .

The fact is that wages did increase and the hours did improve gradually for the workers, as companies had to grant them better terms in order to attract the needed labor. Neither the state nor unions were ever necessary to make the improvements happen. The improvements were already happening anyway, minus the speeches from the politician and labor union demagogues.

. . . while watching others, management, CEO's, etc, getting ever more wealthy? Is that the kind of society you argue for?

What's wrong with a society making everyone more wealthy (or creating the greatest good for the greatest number)? The society you're arguing for is one where the general living standard would decrease -- or would end up lower than if you had let the free market determine all the prices and wages instead of artificially driving up the labor cost -- because your prescription makes production more costly > less production and higher prices > lower living standard to the whole population.

Your prescription for change continues to ignore the supply-and-demand consequences which your demands impose onto the producers. I.e., simple scapegoating/punishing all employers as a class, demanding that they must pay higher than the market value of the labor, can only lead to worse conditions overall for society -- reduced production and higher cost imposed onto consumers.

 

[Lumpenproletariat]

What's the real problem? It's not that EMPLOYERS as a class are screwing wage-earners.

You're going too far in the other direction. We need both labor and capital. What the left fails to understand is that an increasing percentage of the pie is going to the tooling that makes workers more productive.

No, the evidence shows that an increasing percentage of the pie is going into the pockets of the already wealthy.

Let's assume that's correct, however this was calculated. What's for sure is that the share going to wage labor is stagnant or decreasing while profits increase.


Must all wages automatically increase,
as an Absolute Universal Law handed down from on High?

Why? There's nothing in economics which says EVERYONE in the economy has to keep getting higher and higher income from their work as the economy improves. There are still some whose income decreases, because THEIR VALUE DECREASES despite the increasing value of other producers. This is actually the norm, as certain producers become obsolete and their jobs are eliminated. The fact is that some (or much) of the wage labor has decreased in value, as the supply of labor has increased and more jobs are replaced by machines.

Even if these disappearing jobs, or jobs becoming less valuable, are a large part of the economy, still it's necessary for them to decline and for those workers to change to something more valuable if they are to maintain the same income level as before. It makes no sense to just pity them and artificially prop them up in their uncompetitive jobs because they might be a large segment of the economy, or because they are a high-profile segment, like steel workers or auto workers. Just because we have romantic adoration for some of these is no reason to artificially prop them up as icons or symbols to be maintained for their nostalgic value.

Here again is a scenario illustrating that it's wrong to maintain "jobs" only for nostalgia, or out of pity for the uncompetitive workers:

Jobs Created by ELIMINATING Wind Power *
Last year a wind-powered sawmill was built near the Strand, London. (The Strand is a major road following the Thames River.) Apparently it has been such a successful business that a lot of sawyers are out of work. (A sawyer is a man who saws wood by hand.) King Charles the 1st of England is fighting an economic slump so he demolishes the sawmill in order to quell a possible riot and puts the sawyers back to work. [1] [2] [3] [4]
http://tspwiki.com/index.php?title=1634#Jobs_Created_by_ELIMINATING_Wind_Power_.2A

Doesn't everyone, at least today, recognize that the above action was wrong? Don't we know better than to provide "jobs" like the above, only for their babysitting role in the society? Even if the British 400 years ago were inferior to us today (or whatever explanation you want to give), don't we today have a higher understanding of human worth than to follow this kind of Neanderthal Economics?

Whatever is wrong, can't we see that mere obsessing on "jobs! jobs! jobs! jobs! jobs! jobs! jobs! jobs!" per se is not going to fix it?


So then, what does it mean to say "an increasing percentage of the pie is going into the pockets of the already wealthy"? Is there something wrong in this? Maybe, but it's not that those lower-level wage-earners are getting shafted. Because their decline is simply a reflection of their decreasing value, as they can easily be replaced while the same production continues. So, if something is wrong, it's that some of those in the highest brackets -- in the top 10%, or top 1%, or top .1% -- are taking a disproportionate share. A simple solution generally is to get a higher tax percent from those top elite.

So instead of transferring wealth from the top elites to the low-level low-value wage-earners, so these are artificially propped up above their value, the transfer should be from those top elites to the whole economy, to everyone, to the state which needs the revenue for infrastructure to serve all the population.

Failure to do this might be what's causing some stagnation in the economy generally, as there is a vast increase in public debt, plus also a failure to do needed infrastructure, both due to lack of revenue to pay for needed infrastructure.

All the symptoms of a failing system are explained by this, rather than by the false perception that the common wage-earners are getting shafted or screwed out of their "fair share" of the wealth being produced.

So very possibly something is wrong, as too much wealth flows toward the super-rich. But this has nothing to do with EMPLOYERS as a class being stingy and cheating the workers. Rather, it's that some/most of the super-rich are not paying a high-enough share into the public revenue to pay for the public needs. This group of super-rich are not to be equated with all employers as a class, which includes some rich but also some middle- and even lower-income producers who are struggling to survive and who should NOT be seen as getting more than their fair share just because they are employers.

 

[Lumpenproletariat]

No, it's not "EXTORTION" if there's no threat (from the worker or employer) to do harm to the other.

If workers join together in order to get a better deal they are capitalizing on their strength in numbers. By doing so they balance (to some degree) the advantage that employers have over individual workers. Unions secure better deals for workers. Proven without a shadow of doubt.

If workers join together in order to commit extortion of course they benefit. If the state won't prosecute crime of course the criminals benefit!

It's not extortion.

Right, as long as there's no threat of violence against the employer. If the one making demands threatens violence to the other, then the free choice is curtailed = extortion, no matter which one is threatening the other. But merely refusing to deal because the terms are not satisfactory is not extortion.

(In labor disputes where the strikers threaten property damage or violence to replacement workers, etc., then it is extortion.)

"Extortion" means to threaten the other with harm. But merely saying "Then I won't do business with you," or "Then I won't hire you," or "Then you can take your job and shove it!" etc., is not threatening harm, because you're leaving the other one no worse off than if you had never met.

If your "threat" would not make the other person worse off than they were already, then it's not a real threat of harm to them and so is not "extortion" per se.

It's a balance of power. As it stands, it is the employer who has the power to set wages and the employee who has no choice but to either accept or have no income. That is extortion.

No it is not! Stop that crybaby whining. That employer is leaving you no worse off than you would have been anyway.

You still have not answered

Why is VOLUNTEER work permitted,

if you disallow a wage level below a prescribed minimum (what the worker needs in order to survive)?

Will you please stop pussyfooting around and finally answer this relevant question?

There are many volunteer workers who are paid Nothing, ZERO, nada.

Why isn't that also "extortion" by your principle? How is that not also "exploitation" of the workers, where the employer is much larger = power imbalance?

 

[Loren Pechtel]

And murder has nothing to do with killing someone.

Labor actions are 100% pure extortion. The fact that it's by the workers is completely irrelevant. If it weren't for the protections built into the law every striker would be in jail.

It's not 'extortion' because you say so.

https://criminal.findlaw.com/criminal-charges/extortion.html

Other types of threats sufficient to constitute extortion include those to harm the victim's business

What is a strike but harming a victim's business?

Individual workers have very little leverage unless their skills are in demand.

Which has nothing to do with whether it's extortion.

It is collective bargaining that enables ordinary workers a stronger input into wage rates and conditions, which gives the relationship a degree of balance. Without which the employer is able to exploit workers at will (especially in the absence of legislation).

This is about a fairer relationship between the two parties.

Your 'extortion' claim is both emotional and false.

Just because you don't like it doesn't make it false.

 

[Loren Pechtel]

The widening gap between income at the top end and that of the average worker is quite clear.

You have yet to present the income of the average worker to even make that claim. And your income at the "top" is referring to what a few people at very large companies make, not what the average CEO makes.

Average wage is not the issue here. The issue is the growing divide between the highest paid and the rest of the workforce. The issue has been described numerous times.

If average wage doesn't matter why do you keep bringing it up?

Besides, this isn't a sporting competition, people are paid based on what they bring the company.