We have been arguing about this since the strikes of the garment workers in NYC in 1910

This case for unions is really simple.

• Labour is part of the cost of production;
• Business boards are obliged to minimise the cost of production;
• They will therefore drive wages as low as they possibly can, regardless of the social cost – which is not a cost to their business;
• the bargaining power of ordinary workers relative to their bosses is negligible;
• there are no other interest groups willing to fight for workers;
• government is reluctant to regulate to ensure reasonable wages and working conditions;
• unions help to balance the negotiations and achieve fair outcomes leading to a stronger industry; and,
• business based on unhappy workers will turn out bad quality products and lose market share.

It is quite true that firms with high labour costs may lose in the market to international competitors with low costs, and this will hurt share holders and workers. We have to find a way around this that does not harm our society. That is a big challenge that will require those highly paid executives to earn their keep. They need to think more about things like innovation, brand control, IP, quality control, automation, non wage incentives, keeping jobs and know-how in America, etc.

Government should try to find ways make the social costs of low wages become part of the cost of production: which they are but we all pay them now, not the shareholders who get an artificial profit.
We should stop regarding people who stand up for fair wages and conditions as socialists, akin to evil communists.

Conservative governments are most keen on suppressing wages and conditions but somehow they still they draw support from workers.
Pushing worker’s buttons for patriotism, freedom, Christianity, gun ownership, and, abortion helps make them conservative voters willing to accept deteriorating wages and conditions.

Workers have to smarten-up too! They need to work harder and smarter to deserve better wages and work out which politicians really have their interests at heart.

I found this interesting … you always hear “American auto workers are paid too much” and sometimes the quotes range between $70-90 an hour. I found this link explaining how the paper $27 per hour for a Ford worker is really much higher due to other aspects of benefits not included in the calculations. That definitely puts them above the 2011 national average that is supposed to range $13-25.

It does make you wonder though … does a factory worker really need to be paid that much when so much of the very dangerous work is performed by machinery now?