Thursday, November 22, 2012

Pearls from a friend

Sometimes in the course of our lives, a friend will put pearls of wisdom out for us to enjoy. This is one such occasion. As many know, I am a fighter for conservative ideas on Face Book. My 3000 + friends on FB see my postings (unless they block them) all the time. On one thread talking about Labor Unions killing Hostess and Twinkies, a friend posted the following.

Gotta side with Mr. Wayne here, David. Our economy is floundering because our government has gradually pushed us away from capitalism to entitlement driven credit card economics.

If you look at the highest cost of living regions in this country they are decidedly liberal in their political orientation (California being the prime example) while the lower cost regions, like the midwest where I live, are considerably less so.

In my area gas prices are currently right at $3 a gallon and one can purchase a decent house for $130,000 and a very respectable house for $200,000. Washington and the coasts like to minimize us by calling us "fly-over country" and pigeon hole us as extremists clinging to God and guns, etc. But we are clinging to a much better cost of living and economy as well. That comes from two things. The first is a more limited involvement of government in our lives. While the federal government is doing its best to erode how we live, locally we are very conservative and our economy shows it.

The second is an overall lower cost of labor. It’s simple economics. I learned it in my very first economics class in college. The price of things is directly proportional to the cost of production. Unions like to indoctrinate their membership to look for and vilify what they define as greed and blame it for everything. But businesses don’t operate to be benevolent, they function to make a profit. The more labor costs cut into the bottom line the more the price of the product increases and along with it the price to the consumer. The reason that system has gotten muddied up in a bit in our economy is that we don’t manufacture much anymore. We operate on service and value is a difficult thing to accurately apply to that.

The loss of manufacturing in this country is the fault of a regulation and tax-happy government and the prohibitive cost of labor to make the simplest item. Unions will say it is the “rich getting richer” and “corporate greed” and other such platitudes but those are excuses. The truth is that there is an insatiable blue collar greed and envy that the unions foster and play on to make them hate those that have achieved what they have not and covet more and more of what they have. They claim it as a right, they say that the wealthy have in some way cheated or stepped on others.

The truth is that no machine functions without its smaller gears. No one builds a successful business without using employees to get there. But just like the machine if you make all the small gears into big gears the machine moves slower and it takes more to get the same job done. And sometimes the engine doesn’t have the torque to turn all those big gears. The union tells its folks that they all deserve to be big gears; that they should grow appreciably on a regular basis.

When I was starting in my field a laborer coming out of apprenticeship made a scale of about $18/hr plus benefits after 3 years of “training”. Today that same laborer does that same 3 years and comes out at almost $40/hr plus benefits. In that same time period the overall cost of living has not doubled. This removes the hurdle of working up from the bottom. When I started out it took me many years of working my way up from the bottom. The average 18 year-old numbskull can join the union and in 3 years be making the top wage with no effort, no payment of REAL dues, only those monetary ones required by the union. And then, in the trade unions, after his apprenticeship he can work 20 years and retire at 41 with a full pension. That is an unsustainable system that adds the cost of supporting a person who will most likely live at least another 30 years without contributing anything. But cost drives economy. When a business wants to open they have little choice but to use the trade unions to build. And now the cost of that has MORE than doubled. If you can’t see how that will drive that business’ prices then you are being intentionally obtuse.

In your “eat the rich” mentality, taught to you by union bosses who are doubtless fairly wealthy themselves, you may choose to call an admiration of those who have succeeded “rich worshipping”. But the reality is the wealthy drive sectors of the economy that profit us all. Hating them and punishing them for being successful only makes them withdraw and causes economies to shrink. If you are narrow-minded enough to believe that the well from which the middle class drinks is boundless and your share can always be increased exponentially then you are destined to discover that axiom for yourself. But I am sure you have been trained well enough that you will blame the hand that fed you. In your mind it will be corporate greed that kills your industry, not individual greed.

As to the accolades you would shower on your own country, you should probably save them. I have Canadian acquaintances who are not boilermakers and they don’t have all those nice things to say. And as to any comparison to this country, please. Last year you had a population of 34 million and a GDP of $1.7 trillion where the US had a population of 305 million and a GDP of $15.5 trillion. Comparing the two is like comparing apples and hoola-hoops, they’re not even in the same department of the store.

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