Joy and Cleo

Joy and Cleo
Friends, Americans, cat lovers, lend me your ears!

Welcome

I have called this blog “Mints for the Mind” because it is my hope that the things that I share will be to your mind as a mint is to your mouth, leaving it feeling cool, clean, and refreshed. Some things may be like starlight mints, some like Mentos, some like BreathSavers, and some like Altoids. Sometimes they may be, instead, more like sourballs, and for those times I ask, in advance, your forgiveness.

21 July 2010

Basic “math” of how unions are ruining us

The basic math, fairly simply put, is as follows. A company sets a price to sell their products. This price is, hopefully, one that pays all of their expenses and gives a reasonable return to the investors. Competition keeps that return from being exorbitant, keeping prices lower, and also exerts pressure to be more efficient, as lower prices, all other things being equal, bring more business. When a cost goes up, whether it is materials, labor, or investment, the price has to go up, or the business has to stop producing the product(s). (The cost of labor is determined by competition, as are the other costs.) So higher costs either cost consumers/purchasers more money or the opportunity to buy the product.

Introduce unions. Unions do have their uses to prevent *abuse* by companies in some situations. However, when unions coerce the price of labor above a competitive level through the use of force (yes, I mean force...what else do you call picket lines and reprisals against those who cross that line?) then they are essentially either holding up everyone who consumes that good for more money and/or doing harm to the company and society. This is because the company must raise prices, taking money from the consumers, must stop or lower production, or must sacrifice. Assuming that competitive forces have resulted in a price without exorbitant profit, continued such sacrifice will ultimately close the company. (I recently read that business owners are not very good at getting a good enough profit to be successful, even without outside pressure, because they tend to be overly optimistic. Having fallen prey to this myself I believe it.)

Unions are, at this point in history, legalized gangs of thieves and vandals, stealing from and damaging everyone, including themselves!