Conffederate
Confederate

July 05, 2011

Economic Reality Strikes Teamsters Shop; L.A. Times Columnist/Sockpuppet Hardest Hit

Michael Hiltzik has his diapers in a bunch because BMW made the business decision to layoff a parts distribution warehouse full of union workers making $25/hr with health benefits. The company will instead rely upon outside logistics contractors for their parts depot work.

It's brutal, and people who lose their jobs don't often happen to find a new one soon. Companies and people alike are barely scrapping by, and all of us are trying to save money where we can. That is our economic reality.

Many Americans—particularly those on the left—can't seem to grasp that you cannot legislate prosperity. You can demand that companies provide salary "x" or benefit "y" through law or collective bargaining, but at the end of the day, you are faced with the harsh economic truth that government isn't nimble enough to react to market forces, and unions exist to benefit their executives, not the rank and file. This leads to scenarios where people are paid more than what their actual skill-set is worth, and that creates the opportunity for more efficient vendors to move into a market segment and make all companies involved more profitable.

On the personal, human level, these sorts of decisions are incredibly painful. Having gone through the dot-com crash of the early 2000s, layoffs and personal bankruptcy as a result, I know that as well as anyone.

But even were things were bad for me, I knew that when the market is allowed to correct itself it lifts the entire economy, and that leads to prosperity across the board for everyone. Unions and big government retard that growth opportunity, make things stagnant, and ensures eventual, inevitable failures.

Hiltzik's writing is emotional and touching and certainly captures the human drama of what these individual families are now having to face. It is too bad he couldn't use that same talent to explore why the layoffs at this plant means jobs for others in the parts business elsewhere, or how the money BMW will save here will be used to create opportunities and jobs elsewhere throughout the company, and lead to a stronger company overall.

Posted by Confederate Yankee at July 5, 2011 10:16 AM
Comments

Some people believe that when they are in the right, the other guy must be in the wrong. Thus it is with some union members, who think that because they represent workers in an industry their opinions and representations must take precedence over the opinions and representations of others.

You and the other guy can be right at the same time. Not in the same way, and about the same subject, but right none the less.

So we get people who find agreement in any way distasteful and disagreeable, thinking that only their way is the right way. Which leads to confrontation and conflict when such is not only unnecessary, but down right harmful.

Posted by: Alan Kellogg at July 5, 2011 12:27 PM

"But even were things were bad for me, I knew that when the market is allowed to correct itself it lifts the entire economy, and that leads to prosperity across the board for everyone."

Can you provide a real-world example from history to show that this has ever, actually, happened? For real? I can think of no example from history in which free markets lifted the entire economy and brought prosperity to everyone.

History is full of examples of unregulated market economies experiencing short-term booms that enrich a few people but not everone, inevitably followed by busts in which all but the most insulated lose their shirts. I am not aware of any exceptions. Perhaps there is an exception that I don't now about ... ?

Posted by: Barbara at July 5, 2011 12:46 PM

Barbara,

You live in the only nation in human history where obesity is a problem of the poor, where many people on social services own one or more personal vehicles, own a closet full of clothes, and have the luxury of personal cell phones, video games systems, multiple televisions, etc.

If you do not see that our "poor" are better off than the middle class in 90% of the world, and that they benefit immensely from living in this society because of it's general affluence, then I suggest you are desperately in need of perspective.

Posted by: Confederate Yankee at July 5, 2011 01:45 PM

Baba,

Try oil and gas. Then govment applies controls to stifle prosperity

Posted by: LAZRTX at July 5, 2011 02:31 PM

CY -- that isn't even close to being an answer to my question. I'm asking you for a real-world example from history, from anywhere in the world, at any time, demonstrating that markets correcting themselves (by which I assume you mean run without government interference) really truly lifted the entire economy and brought prosperity to everyone.

I can think of many historic examples in which unregulated market capitalism created short-term economic booms, usually from overheated speculation in stocks or real estate or gold or something else, but none of these booms lasted, and none brought prosperity for everyone. Instead, the rich got richer and the poor got poorer. I'm asking you to find an exception.

Whether American poor people can get cheap cell phones and lots of fatty food items off the McDonald's dollar menu is beside the point.

Posted by: Barbara at July 5, 2011 02:36 PM

barbara, most of the booms that you mentioned were caused by the government. Try again.

The ability of every person in the country to work, and make money is what it is all about. The poor usually loll about and don't work so they stay poor. The normal man goes to work and makes a good living for his family until the government gets involved. Usually to help the lazy won't work poor people.

Posted by: Stephan at July 5, 2011 02:44 PM

"Then govment applies controls to stifle prosperity."

Are you saying the government is *trying* to stifle prosperity? That it hates prosperity and wants to stop it? Do you want to consider how irrational that is?

It might be true that government policies regarding oil and gas have the effect of slowing economic growth -- or it might not -- but the reasons behind such regulation have to do with things like resource management and reducing speculation and price gouging. We can argue all day long about how effective those policies are, but to say that their purpose is only to stifle prosperity is nuts.

The argument appears to be that if only government would get out of the way of markets, prosperity would follow as surely as the sun comes up in the morning. And I'm asking, show me a time and place in which that actually has happened. Give me an example. From anywhere in the world, from any time in history. Maybe it is true, but I'm asking you to find a real-world example to prove it.

Saying "things are bad and it must be the government's fault" is not an answer.

Posted by: Barbara at July 5, 2011 02:48 PM

What, America in the 19th century?

But even more salient, can you name a regulated economy that ever brought prosperity of any sort to anybody, except for those running the government?

Posted by: Eric Blair at July 5, 2011 02:50 PM
barbara, most of the booms that you mentioned were caused by the government. Try again.

No, not always. There were several cycles of booms and busts in the 19th century U.S., for example, which was before government regulation as we know it existed. This was true of several other countries as well (read up on Brazil sometime). In fact, the first government regulations of markets came about in an effort to stabilize the economy and keep it from swinging from one disaster to another. It became harder to make a quick fortune, yes, but the country also didn't fall into a new depression every few years.

Of course, it's true there are countless examples of stupid government policies that hurt economies, but I can't think of a single example from history of unregulated markets genuinely listing an economy so much that everyone became more prosperous. What's usually happened in the past that a few people make out like bandits and everyone else stays poor. So I'm just asking for an example.

I guess there isn't one. So, thanks, fellas, go back to your fantasies.

Posted by: Barbara at July 5, 2011 03:13 PM
But even more salient, can you name a regulated economy that ever brought prosperity of any sort to anybody, except for those running the government?

The period of greatest prosperity for middle and working class Americans was the Great Proserity, the thirty year period from 1947 to about 1977. The wages of the bottom fifth of the work force grew 116 percent over these years, and for top workers went up 99 percent. Everyone made money during that period, from the richest to the poorest, but the biggest economic gains were for working people. The economy was regulated a lot more then than it is now.

Real wages for American workers peaked in 1972 and since then have been slowly deflating, and with every round of deregulation things have gotten worse. The rich get richer; everyone else gets poorer.

Truth is a bitch, huh?

Posted by: Barbara at July 5, 2011 03:26 PM
I'm asking you for a real-world example from history, from anywhere in the world, at any time, demonstrating that markets correcting themselves (by which I assume you mean run without government interference) really truly lifted the entire economy and brought prosperity to everyone.

It is truly amusing to watch a leftist continually refine and redefine an argument in such a manner as to make their worldview correct (hence, this blog's tagline). Markets around the world correct themselves constantly.

When a public company offers a product or service that people want, their profits (and a number of other things ) go up, enabling them to expand and hire more people.

For example, Company A works in the computer hardware market, and was able to turn a 30% profit last year. CA then takes that profit to acquire smaller companies that have technologies that will round out their product portfolio, and also hires more people organically as needs within various business units grow.

Company A will add 2,300 jobs next year, after adding 1,500 the year before and 1000 the year before that.

On a per salary basis, the median income among all the jobs for the thousands of employees will drop slightly, because redundant middle management and senior management positions will be consolidated, and the increased volume of product will mean more engineering, marketing, warehouse and assembly jobs.

Using Barbara's left wing logic, the fact that Company A grew in size tremendously, adding 3,800 jobs to the economy in just 3 years, is irrelevant. Using her logic, Company A is a failure, because the number of lower-skilled jobs in the company grew the most.

Watch the left long enough, and you'll realize that their idea of fairness is everyone enjoying mediocrity, and that they hold great disdain for innovation and over-achievers.

Now, I'm off to make more money...

Posted by: Confederate Yankee at July 5, 2011 05:47 PM

BaBa,

Whanabe college professor..Those that can't, teach.

Posted by: LAZRTX at July 5, 2011 08:24 PM

Barbara, you are so wrong and have no idea what you are talking about. It is sad, but it is a disease almost all libs/progressives have. Point of reference here is David Mamets book. Buy it, read it, try to open your mind. Now onto why you are wrong. The ultimate measure of the economy, be it boom or bust is GDP. Stands for Gross Domestic Product. It places a dollar value on EVERY facet of the economy and commerce. Nothing is left out. GDP since 1940 is as follows:

1940 101 billion
1950 294 billion
1960 526 billion
1970 1,038 billion
1980 2,788 billion
1990 5,800 billion
2000 9,951 billion
2010 14,660 billion

Thats growth!! That is what CY is referring to. That is a rising tide that floats ALL boats. Look up what your beloved auto worker made in 1940, then look at his income package in 2000. His boat was floating with the rising tide of wealth. Everyone made money, some more than others, but thats life. Babe Ruth hit lots of home runs, but Alex Rodriguez makes a great deal more than the Babe, with less home runs. Thats the tide, thats growth, thats GDP!!!

Educate yourself. Google historic GDP data.

Posted by: mixitup at July 5, 2011 08:44 PM

Look, you guys are so dumb you can't even understand the question, let alone fabricate a correct answer. Let me rephrase Barbara's question so that even you right wingnuts can understand it:

"Show me an example where one of history's dictatorships, monarchys, or communist regimes tried completely free-market capitalism and every single person, including those who refuse to work, those who choose to remain unskilled, those who make a living committing petty crimes, and the insane, all became equally rich with the doctors, factory owners, CEOs, land owners, government leaders, and anybody who worked sixteen hours a day".

See? You free-market loonies can't do it, can you? Obviously a centrally planned economy controlled by your friendly and benevolent Federal government is the only answer.

Posted by: Walt at July 7, 2011 12:04 PM