Thomas Sowell had a
great article yesterday on myths about unions that bears reading in the current context of the disputes over public employee union benefits in Wisconsin and elsewhere. His main point is that unions have, in the long term, been a bad deal for workers:
The most famous labor union leader, the legendary John L. Lewis, head of the United Mine Workers from 1920 to 1960, secured rising wages and job benefits for the coal miners, far beyond what they could have gotten out of a free market based on supply and demand.
But there is no free lunch.
An economist at the University of Chicago called John L. Lewis “the world’s greatest oil salesman.”
His strikes that interrupted the supply of coal, as well as the resulting wage increases that raised its price, caused many individuals and businesses to switch from using coal to using oil, leading to reduced employment of coal miners. The higher wage rates also led coal companies to replace many miners with machines.
The net result was a huge decline in employment in the coal-mining industry, leaving many mining areas virtually ghost towns by the 1960s. There is no free lunch.
Similar things happened in the unionized steel industry and in the unionized automobile industry. At one time, U.S. Steel was the largest steel producer in the world and General Motors the largest automobile manufacturer. Not any more. Their unions were riding high in their heyday, but they too discovered that there is no free lunch, as their members lost jobs by the hundreds of thousands.
"There is no free lunch" ought to become the mantra of America going forward, if we are going to survive.
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