Tag Archive: economics: Social Memory Complex

Some unions are more collusive than others

I often hear defenders of "Right to Work" (RTW) laws say that unions are collusive and extortive in a way that is simply unfair to employers. Neither workers nor management should be forced to negotiate through unions, and RTW laws simply level the playing field by ensuring that employees can always negotiate directly with management. The point of labor unions, to the mind of RTW supporters, is to exploit the Wagner Act that forces all parties to negotiate in good faith, and to thereby move wages and benefits up in a way a free market in labor would never allow. The aforementioned article on RTW even compares unions with Mafia protection rackets in this regard.

To describe this line of reasoning as selective would be a gross understatement. After all, let's assume that labor unions are as evil as the RTW lobby says they are. Even granting that for the sake of argument, labor is not the only interest engaging in collective bargaining. What about the individuals involved in the employing corporation? Aren't these businesses effectively "capital unions" exploiting incorporation laws to achieve a better bargaining position relative to labor? Isn't the reason why investors pool their resources and form businesses to get better deals in the market through economies of scale? Isn't that why they try to get investors rather than simply borrowing all the money for their start-up costs--to spread the risk and the reward?

So unions of labor are only one side of this story; to emphasize collusion on the workers' side is to leave another form of collusion totally unaddressed. Corporations are capital unions, organizations whose members work together to negotiate wages and benefits (and other costs, of course) downwards to get the best return for themselves. Why is one form of collusion wrong and the other not?


Written on Monday, December 17, 2012
Tags: labor, libertarianism, free-market, economics, corporatism

Glenn Greenwald and the Technocratic Blind Spot

I'm a big fan of Glenn Greenwald; just about every position he takes is anti-authoritarian, liberal in the best sense, and based on rule of law (which, in this age, is as close to fairness as one can expect). However, he wrote an article on the Chick-fil-a controversy that bugs me. On the narrow question of whether governments should be able to punish corporations for political advocacy, I agree with him that such punishment is unconstitutional. I take issue with his reasoning, though.

Greenwald invites us to consider a series of bills that enlist government in punishing corporations for views they express, money they donate to causes, etc. Some examples:

  • Congress enacts a law that states: No business incorporated in America, whether for-profit or non-profit, shall be permitted to donate any of its money to groups espousing liberal ideas. Any business found to be in violation of this prohibition shall be guilty of a Class A felony. Corporate donations to groups espousing conservative causes shall still be permissible and legal.
  • A city enacts an ordinance that states: Any business found to have donated money to any group that advocates same-sex marriage or abortion rights (including Human Rights Campaign and Planned Parenthood) shall be barred from doing business within the city limits. Businesses shall still be permitted to donate money to groups which advocate against same-sex marriage or against abortion rights.

I agree with him that the above laws are unconstitutional. Government is prohibited from discriminating or giving unequal protection to the free speech rights of corporations as currently settled law stands (that was indeed one of the caveats he made). Indeed, Greenwald took pains to point out that even in the Citizens United case, not one Supreme Court justice questioned the legitimacy of corporate personhood at all (I addressed Greenwald's commentary on this matter in more detail here). I also agree with him that The Nation's Lee Fang takes an unprincipled, politically expedient position against corporate personhood -- one cannot confine one's critiques of the doctrine to only those cases where it acts against one's sense of justice. Nobody wants to be allied with a hack like Fang less than I.


Liberty is the Mother, Not the Daughter, of Any Market Worth Having

I haven't weighed in much on Wikileaks because everything I'd write has been written by better writers. Readers here shouldn't need to resort to wild speculation as to my position: Wikileaks is in the absolute right on each and every matter, and the government as per usual in the wrong. Cablegate is just the latest in a series of heroic and perilous pantsings administered by Assange et al. The weakness of the lumbering, bureaucratic monolith of the U.S. government is exposed for all to see if they choose; it remains to be seen whether Americans care.

My interest today has more to do with Amazon.com's booting of Wikileaks from their web services hosting. The Amazon Web Services statement explains the supposed motivations are not the result of Joe Lieberman's bullying - the tone suggesting outrage that anybody would dare think Amazon.com would cave to such pressure. Instead, they provide two reasons for their decision:

  1. Wikileaks' supposed violation of their terms of service because they do not own the content they are publishing (even though the public pays for it)


    Written on Thursday, December 02, 2010
    Tags: libertarianism, markets, economics, censorship, wikileaks, cablegate

Freedom may not be free, but it's not priced in dollars, either

I've tried to chew a bit on Bryan Caplan's post about why he is not a left libertarian before I raced off to refute it point by point. That's because I suspect no refutation is necessary; Caplan throws into rather stark relief precisely why left libertarianism has more to do with attitude and temperament than blatant differences on principle.

Caplan argues over and over in his article that certain left libertarian arguments do not make sense because, if you consider the issues from an economic point of view, everything balances out. In doing so, he glosses over a key difference between his approach and that of left libertarians generally; many of us find the typical libertarian reduction of all matters of justice, culture, etc. to economic calculation totally warped and inaccurate. More and more of us are rejecting a rigid market fundamentalism that seems to discount any issue that cannot be modeled economically. There's more to human flourishing than marginal value.

For example, Caplan may be right that we effectively forego a fairer rental agreement with our landlord in exchange for lower rents. It's certainly an elegant argument that provides a clean explanation for our entrance into supposedly free contracts with such little negotiating wiggle room for ourselves. Of course, for economists, it's all about explaining within the constraints of the model - there's no price one can place on human dignity, the social effects of systemically lopsided contracts, etc. A pure economic argument does not address whether justice is served, or why people place such a low priority on being treated fairly. It doesn't attempt to back up the speculation on people's motives for accepting skewed contracts with evidence; the mere assertion that our market system has mediated this contract is proof positive that it is fair and balanced, and so the only task left is to come up with explanations for why we chose such an arrangement.


Written on Monday, October 11, 2010
Tags: economics, subjectivism, marginalism, libertarianism, vulgar-libertarianism