I have a problem with unions. It comes down to two things: Unions are too powerful and too easy to abuse. Unions are currently absolutely necessary to take care of problems that the government refuses to treat fairly.
The recent Supreme Court ruling on a dispute between an Amazon contractor and its warehouse employees (which I have discussed in more detail in a previous post) illustrates the second part of my problem. Without unions, many workers are just plain not treated fairly. In the Amazon case, workers were being forced to go through excessively long security checks daily without pay for the time spent. Our Supreme Court justices (whom I must assume are idiots, because the only other option is that they are deliberately helping to enslave and oppress innocent Americans, and I want to give them the benefit of the doubt) declared that businesses do not have to pay workers for time spent doing anything that is not, in essence, part of the job description. At this point, this declaration now counts as an infallible part of U.S. law. The government offers no protection for what amounts to blatant wage theft. There is only one solution: unions.
Unions were originally created in response to government inability to enforce fair labor practices. In the early U.S., it was common for employers to underpay workers and to require far more hours of work than is healthy or fair. Unsafe work conditions were more common than safe ones by a very wide margin. People were regularly inured or killed in workplace accidents that could have easily been prevented, because owners were too cheap to spend even small sums to ensure safety. Children were treated as slaves, working 16 hours days in these conditions, for so little money that entire families had to work, and that was still not enough to get by. The government was not powerful enough to do anything to stop these unfair practices, and in many cases, the government did not have enough reach to even be aware of them. The solution was labor unions.
Workers in these conditions eventually banded together, demanding fair treatment. Their employers refused the the demands and threatened to fire anyone who continued to dissent. Eventually the workers realized that if all of them dissented at once, their employers would be unable to replace them all fast enough to avoid financial catastrophe. The worker strike was born (it was actually born in France, but it was quickly adopted by oppressed U.S. workers). Nearly all of the workers in one or more factories refused to continue work until conditions, hours, and wages were improved. Employers were powerless against the unions because they were dependent on the employees. Firing them all would result in financial ruin for the company. Initially the government panicked: Worker's unions threatened the U.S. economy. If workers had so much power, they could easily force businesses to pay so much that it would cause rampant inflation. Besides that, even short strikes resulted in production halts, and in factories that produced necessities, those halts could result in serious harm. This did something else very important though: It put the problem of workers right in the face of the government, where it could no longer be overlooked or ignored.
The government realized that treatment of workers was a major problem. It also recognized its responsibility in doing something about it. The government still did not have the power or reach to handle the problem on its own. It did have the power to protect the workers in their own attempts to deal with the problem. Business owners lobbied the government to make unions and worker strikes illegal. Their claim was that these things caused economic instability. Their claims seemed reasonable, however, the government eventually recognized that the underlying problem was not the strikes, but the unsustainable hours and pay, as well as the often deadly work conditions provided by employers. Laws were passed to protect unions and striking workers from retaliation. Currently, workers cannot be fired for discussing unionization, actually unionizing, or for striking. Workers who are striking on economic grounds (wages, other compensation, or work hours) can be "permanently replaced" (they cannot be fired, but if a willing replacement can be found, the strikers hours can be reduced to 0 indefinitely, which is approximately the same as being laid off). The government also created a set of safety and treatment requirements and guidelines for how employees may be treated. Strikes related to these issues are further protected, prohibiting even permanent replacement. When it comes to safety and other government protected employee rights, replacements hired during a strike must be fired to make room for striking employees returning to work once the dispute has been resolved.
The potential for abuse of unions was still clear, so some restrictions have been added. Closed shops, where the company may only hire union members, was strictly prohibited. Closed shops allow the union to control all hiring decisions by restricting admittance into the union. This gives the union veto power over any hiring action. In the U.S., closed shops are illegal. Union shops, where new hires are required to join the union after being hired, are legal, as well as agency shops, where non-union members must still pay union dues, and open shops, where employees may choose but are not required to pay dues if they are not union members, are all legal in the U.S.. Prohibition of closed shops prevented the most obvious abuses of unions, but it still left some loopholes, most of which still exist.
When unions were originally created, they were necessary. They were very useful, and they did a great deal of good. Since then, many things have changed. The biggest change is power and reach of the government. Workplace safety is no longer a serious union issue, because OSHA, a government agency, defines and enforced workplace safety. If a workplace is unsafe, it is faster and easier for an employee to report the violation to OSHA than it is for a union to try to resolve the issue, and the penalties for those violations are enforced by the government, making workplace safety violations fairly rare. Wages are still a problem, but not because the government is not powerful enough to do anything about it. They are a problem because the government refuses to do anything about it. Worse, the most common places for wage issues are not well suited to unions, because employee turnover is too high. In the past several decades, most union wage issues were not problems of employers paying unfair wages. Most of the issues were greedy employees who were already being paid far higher than the U.S. average wanting more than their fair share (and, in the case of the U.S. steel industry, this was one of the blows that ultimately killed it). Unions are no longer useful tools for enforcing fair wages. Instead they are tools for overpaid employees to rip off their employers even more.
Work hours were another major thing that unions were good for. Twelve to sixteen hour work days were common. Unions pulled the U.S. work week down to 40 hours and the work day to 8, requiring extra pay for any time worked beyond that. Of course, the goal was actually closer to 35 or 30 hours a week (20 according to some), but unions lost sight of that goal almost a century ago. Unions are no longer necessary to enforce this though, because the government has enacted laws prohibiting employers from giving employees more than 8 hours of work in a day and 40 in a week, with an additional requirement that when this is violated, employees are paid extra for time beyond those limits. This is no longer a union problem; it is now a government problem. Worse, despite unions and government, the average American voluntarily works an average of 50 hours a week and often the overtime goes entirely unpaid. When the workers don't care, there is little unions can do to fix the problem.
Overall, unions have lost most of their usefulness. They still have potential for abuse though. Unions have a great deal of lobbying power. In Alaska, in the mid '90s I believe, the workers at some of the power plants went on strike. I don't know all of the details, but I do know that the labor union exercised power that belongs only to government and individual citizens, by manipulating the state government in making some very harmful laws. The power plants hired electrical workers from Washington state, as temporary workers until the strike was resolved. In retaliation, the union lobbied the state government to change certification laws to require electrical workers in Alaska state to have gone through their training in-state. In other words, a journeyman or master electrical worker in Washington state could only be hired as an apprentice in Alaska, without going through all of the time required for certification within the state of Alaska. The union did this to put more pressure on the power company by denying them well qualified temporary workers (the law specifically prohibited hiring them into positions that normally required journeyman certification). Besides being a low and very unethical blow, this has some severe economic implications. I am certain the argument given to the legislature and governor was that hiring out-of-state workers would drain money from the state economy. I don't think this justifies using the law to lie about a person's job qualifications, but besides that, this economic justification was incomplete. The end result was that the workers got most of their demands. The economic consequences of that was increased cost for power, which resulted in economically damaging inflation in a state where the cost of living is already quite high. There may have been short term economic costs of hiring out-of-state workers, but the long term costs of not doing so were far worse. There is also another long term economic cost: The electrical workers union in Alaska now has a legally enforced monopoly on electrical labor. The political power held by unions has not just been harmful in Alaska. In other places in the U.S., unions have used the law or other political influence to merge with other unions against their will (by "merge," I mean "hostile takeover").
Unions have largely become for-profit institutions in the U.S.. Their primary goal is no longer doing what it best for the workers or even representing the workers. Their goal now is to do whatever gets the union the most money. This frequently means demanding higher pay even when it is not needed or fair. It also preempts any requests for reduced hours, because reduced hours means lower gross pay, which means lower dues. By allowing union and agency shops, the government has allowed unions to force employees to become union members and to pay union dues against their will. Unions in the U.S. typically have a number of permanent employees who are not actually members of the union. In many unions, this includes a CEO and other administrative positions, who make decisions about what the employees want, without actually having any experience of being one of those employees. Some of these positions, like lawyer and accountant, are justified, but full-time administrative positions in a union are absurd. Unions are now run primarily by people who are totally disconnected from the union members and their work environment. Frankly, a union that is a for-profit business should not have any degree of legal protection beyond what is normal for any other for-profit business. Otherwise, it is even more prone to abuse.
So, now we come down to the problem: The government now has the reach and power to make unions entirely obsolete, and it has already made them mostly obsolete. Instead of doing that though, it is actually making unions more necessary. Unions should no longer exist, because they should no longer be needed. When they were created, the potential for good outweighed the potential for abuse. This is no longer true...except, when the government fails to do its primary job of representing the will and best interest of the people.
The Amazon case is prime example of where unions are useful. The employees are being robbed by their employer. They could unionize and strike, demanding pay for their time worked, demanding that the security check be listed in the job description (making it an essential part of the job, and thus legally part of paid work time), or demanding that the security checks be discontinued. They could even unionize and heavily lobby Congress to repeal the highly constitutionally questionable law the Supreme Court used to justify its appallingly oppressive decision (even abuses of power can have legitimate non-abusive uses). The problem I have with this is that they should not need to unionize to get paid for all of the time they spend doing work required by their employer.
An employer should have the right to require employees to do worthless work (plenty already do it anyhow), but employees should have the right to get paid regardless of whether the work required is profitable or not. This should be legally protected. What free society has a law that explicitly permits employers to blatantly and openly require work time from an employee that does not need to be compensated?
Showing posts with label slavery. Show all posts
Showing posts with label slavery. Show all posts
27 December 2014
27 November 2014
Pulling Your Own Weight
The idea of pulling your own weight is based on the idea that each person incurs costs for upkeep, including food, water, clothing, and shelter. In the U.S., we might add things like internet and electricity to this, but really it comes down to the fact that every person has an upkeep cost, and someone has to pay it. The idea of pulling your own weight is a very old idea, but also a conditional one. Each person in a society that is capable of doing so is expected to pull their own weight. Of course, there have been some deviations from this, but it is largely the most common way of running an economy.
There are some occasional historical exceptions to this, but there are also some chronic exceptions. Historical exceptions almost always involve slavery. Greek philosophy and math were built by people who did not pull their own weight. In fact, if they had not had slaves to pull their weight for them, we would probably not have modern technology and science as we know them. Slavery has been common off and on throughout history. In the U.S. and most of Western civilization, slavery (overt slavery, anyhow) has been abandoned and replaced with an economic philosophy very common to cultures that reject slavery. This philosophy is the idea that every person must pull their own weight. Chronic exceptions to this are very common and will never go away. Babies, young children, elderly people, and disabled people are not expected to pull their own weight, because they cannot. Stay-at-home mothers are treated as not pulling their own weight in many parts of modern society, however this is a filthy lie. They may not be producing goods, but stay-at-home mothers are doing work that is far more important than most of the work done outside the home. Now, the slavery exception is becoming an unusual one that is likely to overturn how we view economy, probably within the next half century.
In older economies, the pull-your-own-weight ideology was a fairly sound one. While it is possible for a small number of people to provide for a large number, the work involved has been excessive. One slave working 16 hours a day might be able to provide the needs of ten or twenty other people, but that slave cannot have any freedom because there is just no time for it. Modern technology has changed this though. Besides finding more efficient ways of producing, it has also provided ways of replacing human labor with mechanical slaves. Mechanical slavery is completely ethical. The machines can work 24 hours a day, and they never need time off or personal time. The only down time is time spent on repairs and maybe upgrades. Experts estimate that this ethical form of slavery will replace about 50% of the human workforce by 2050. This presents a very serious ideological problem.
Here is the problem: The U.S. economy is based on this pull-your-own-weight ideology. We are in the process of rapidly replacing human workers with mechanical slaves. These two things are completely incompatible. If we replace half of the human labor force with slaves and then still expect the humans to pull their own weight, we are expecting the impossible. Actually, we are perhaps doing something worse. We are missing something important. What is the actual weight of a human?
The "weight" of a human is the amount of labor required to meet that human's needs. Slavery with human slaves does not change the weight of a human; it just displaces the labor. Some human still has to pull the weight. Slavery with machines slaves, however, does change the weight of humans. Replacing human labor with machine labor directly reduces the human labor required to meet the needs of humans. This is what we are missing: As we automate more processes, we are reducing the weight of humans. The problem is that we are not accounting for this. We have high unemployment largely because we have reduced the weight of humans, and those humans that are still doing the same amount of work are now pulling more than their own weight. The result is that there is not enough work left for everyone else, because their weight is already being pulled. Unfortunately, because we have not noticed this problem, we are not distributing the results of the work appropriately. The consequence is that some people are pulling more than their own weight, and they are getting the proceeds of that. The people that are not able to pull their own weight are stuck without enough to survive, because their portion is being given to the people that are pulling their weight for them.
This is complicated, and it is not obvious that this is what is happening. Further, there is a very important reason that this is happening: We have reached a point where it is actually substantially less efficient for each person to pull their own weight. When each person's weight costs 2 to 4 hours of work per day (and, when that burden is centralized to one or two people per family), it is fairly efficient for businesses. Each employee spends enough time working to easily keep up with overhead. Now, however, each person's weight comes out to around 1 or 2 hour per day, or even less. When centralized, this comes out between 10 to 20 hours a week. Having every employee work half time doubles the overhead, because the number of employees are doubled (reducing hours does not reduce overhead). In addition to that, higher end jobs often have warm up and cool down time that results in unproductive hours on each end of a shift. This means, in an 8 hour shift, if an hour at each end is unproductive, 75% of the work time is productive. In 4 hour shifts, productivity is reduced to only 50%. In lower end jobs this effect is dramatically lower, but in high end jobs (especially in problem solving work like engineering and science), this is a major obstacle to reducing hours (note that in these jobs, longer time between shifts tends to increase the unproductive warm up time, so 8 hours three days a week is not an efficient solution either). This is an efficiency problem that is never going to go away. It is just not efficient at current human "weight" for each person to pull his or her own weight.
Is there a solution to this? Yes, but it is not a very popular one. It is incredibly unpopular among conservatives, and it is at least mildly unpopular among liberals. The solution is abandoning the pull-your-own-weight ideology. We are quickly becoming a slave state, just like Greece was, except that we are doing it ethically. If we do not abandon this pull-your-own-weight ideology, we are going to either let the majority of Americans starve as their jobs are replaced by machines, or we are going to have millions of Americans working workweeks so short that they are costing more overhead than the value they are generating. Neither of these is a good long term economic plan. One short term solution might be long vacation time, where each employee works "normal" hours, but only for 1/4 of the year, and the rest of the year is vacation time, however, that only partially mitigates overhead costs. The most efficient solution is for some people to work 20 to 40 hour weeks at least 50% to 75% of the year, while everyone else lives off of the proceeds of that work. Some kind of motivation would be necessary for those who work, and this would probably be complicated and difficult to do without resulting in an overprivileged working class and an underprivileged non-working class (ironic, given that historically the opposite happens). Ultimately though, it is going to eventually become necessary, or we are going to have an epic economic crash when so many consumers starve to death that consumption drops below an economically sustainable level.
Things are changing rapidly. Technology continues to advance faster than we can keep up with. In the past, the impact of this has been primarily limited to the tech industry itself. In the near future, however, this is going to have a massive economic impact. If we are not prepared, we are going to suffer. In some degree, the consequences are not predictable, but there is one thing that is predictable: If a large portion of human labor is replaced with machine labor, we cannot have a sustainable economy that is based in the pull-your-own-weight ideology.
There are some occasional historical exceptions to this, but there are also some chronic exceptions. Historical exceptions almost always involve slavery. Greek philosophy and math were built by people who did not pull their own weight. In fact, if they had not had slaves to pull their weight for them, we would probably not have modern technology and science as we know them. Slavery has been common off and on throughout history. In the U.S. and most of Western civilization, slavery (overt slavery, anyhow) has been abandoned and replaced with an economic philosophy very common to cultures that reject slavery. This philosophy is the idea that every person must pull their own weight. Chronic exceptions to this are very common and will never go away. Babies, young children, elderly people, and disabled people are not expected to pull their own weight, because they cannot. Stay-at-home mothers are treated as not pulling their own weight in many parts of modern society, however this is a filthy lie. They may not be producing goods, but stay-at-home mothers are doing work that is far more important than most of the work done outside the home. Now, the slavery exception is becoming an unusual one that is likely to overturn how we view economy, probably within the next half century.
In older economies, the pull-your-own-weight ideology was a fairly sound one. While it is possible for a small number of people to provide for a large number, the work involved has been excessive. One slave working 16 hours a day might be able to provide the needs of ten or twenty other people, but that slave cannot have any freedom because there is just no time for it. Modern technology has changed this though. Besides finding more efficient ways of producing, it has also provided ways of replacing human labor with mechanical slaves. Mechanical slavery is completely ethical. The machines can work 24 hours a day, and they never need time off or personal time. The only down time is time spent on repairs and maybe upgrades. Experts estimate that this ethical form of slavery will replace about 50% of the human workforce by 2050. This presents a very serious ideological problem.
Here is the problem: The U.S. economy is based on this pull-your-own-weight ideology. We are in the process of rapidly replacing human workers with mechanical slaves. These two things are completely incompatible. If we replace half of the human labor force with slaves and then still expect the humans to pull their own weight, we are expecting the impossible. Actually, we are perhaps doing something worse. We are missing something important. What is the actual weight of a human?
The "weight" of a human is the amount of labor required to meet that human's needs. Slavery with human slaves does not change the weight of a human; it just displaces the labor. Some human still has to pull the weight. Slavery with machines slaves, however, does change the weight of humans. Replacing human labor with machine labor directly reduces the human labor required to meet the needs of humans. This is what we are missing: As we automate more processes, we are reducing the weight of humans. The problem is that we are not accounting for this. We have high unemployment largely because we have reduced the weight of humans, and those humans that are still doing the same amount of work are now pulling more than their own weight. The result is that there is not enough work left for everyone else, because their weight is already being pulled. Unfortunately, because we have not noticed this problem, we are not distributing the results of the work appropriately. The consequence is that some people are pulling more than their own weight, and they are getting the proceeds of that. The people that are not able to pull their own weight are stuck without enough to survive, because their portion is being given to the people that are pulling their weight for them.
This is complicated, and it is not obvious that this is what is happening. Further, there is a very important reason that this is happening: We have reached a point where it is actually substantially less efficient for each person to pull their own weight. When each person's weight costs 2 to 4 hours of work per day (and, when that burden is centralized to one or two people per family), it is fairly efficient for businesses. Each employee spends enough time working to easily keep up with overhead. Now, however, each person's weight comes out to around 1 or 2 hour per day, or even less. When centralized, this comes out between 10 to 20 hours a week. Having every employee work half time doubles the overhead, because the number of employees are doubled (reducing hours does not reduce overhead). In addition to that, higher end jobs often have warm up and cool down time that results in unproductive hours on each end of a shift. This means, in an 8 hour shift, if an hour at each end is unproductive, 75% of the work time is productive. In 4 hour shifts, productivity is reduced to only 50%. In lower end jobs this effect is dramatically lower, but in high end jobs (especially in problem solving work like engineering and science), this is a major obstacle to reducing hours (note that in these jobs, longer time between shifts tends to increase the unproductive warm up time, so 8 hours three days a week is not an efficient solution either). This is an efficiency problem that is never going to go away. It is just not efficient at current human "weight" for each person to pull his or her own weight.
Is there a solution to this? Yes, but it is not a very popular one. It is incredibly unpopular among conservatives, and it is at least mildly unpopular among liberals. The solution is abandoning the pull-your-own-weight ideology. We are quickly becoming a slave state, just like Greece was, except that we are doing it ethically. If we do not abandon this pull-your-own-weight ideology, we are going to either let the majority of Americans starve as their jobs are replaced by machines, or we are going to have millions of Americans working workweeks so short that they are costing more overhead than the value they are generating. Neither of these is a good long term economic plan. One short term solution might be long vacation time, where each employee works "normal" hours, but only for 1/4 of the year, and the rest of the year is vacation time, however, that only partially mitigates overhead costs. The most efficient solution is for some people to work 20 to 40 hour weeks at least 50% to 75% of the year, while everyone else lives off of the proceeds of that work. Some kind of motivation would be necessary for those who work, and this would probably be complicated and difficult to do without resulting in an overprivileged working class and an underprivileged non-working class (ironic, given that historically the opposite happens). Ultimately though, it is going to eventually become necessary, or we are going to have an epic economic crash when so many consumers starve to death that consumption drops below an economically sustainable level.
Things are changing rapidly. Technology continues to advance faster than we can keep up with. In the past, the impact of this has been primarily limited to the tech industry itself. In the near future, however, this is going to have a massive economic impact. If we are not prepared, we are going to suffer. In some degree, the consequences are not predictable, but there is one thing that is predictable: If a large portion of human labor is replaced with machine labor, we cannot have a sustainable economy that is based in the pull-your-own-weight ideology.
12 January 2014
Basic Income
It turns out there is supporting evidence for a lot of the claims I have made in the past. I write based on a number of things. One big part of my writing is extensive research. Another part is observations. A third part is math and logic. I have made claims about where our economy is headed, if we keep automating everything. This claim is based part on observation and part in math and logic. It is completely illogical to assume that our economy will never change. It is also illogical to assume that increasing automation will not decrease necessary work. Thus, we can assume that our economy will change, and we can further assume that as a vast majority of trivial work is automated, that work will no longer be necessary for humans to do. We can also assume that unless we create as much new work as is automated, that cannot be automated, human labor will become less and less useful and valuable. Observation has shown this to be true. Currently, many businesses are dramatically underpaying their employees, and still we have a shortage of work (jobs). Businesses can automate many processes cheaper than they can hire humans to do the work, so less human labor is necessary. This results in a surplus of human labor, which drives labor prices (wages) down. I have argued that the logical progression of this will end where most Americans are forced to live off welfare, and very few will actually work for a living (mostly engineers and other creative workers). All of this is based strongly in logic, math, and observation. Now, this is not the case I plan on discussing today, but it is related.
Recently I have argued that we need to improve welfare enough that it will keep people out of poverty. I showed how the U.S. government's definition of poverty is almost half the actual poverty level, and I showed how the current welfare system seems to take advantage of this to trap people in poverty. I argued that we need to fix the legal definition of poverty, and I argued that we need to then fix the welfare programs to take the new definition into account. I also argued that we need to raise minimum wage to reflect the actual poverty level. I may have also argued that Congress needs to regularly reassess the defined poverty level and change the definition if necessary. My take on the current situation changed today, and I find that some of my arguments may be obsolete. I would like to discuss why this is.
Today, I read two things (brought to my attention by a friend). The first is a letter by a guy who quit his job and started writing for a living (found here). This man, Chuck Bukowski, compared the current state of the U.S. economy to slavery, and he once said, “Slavery was never abolished, it was only extended to include all the colors.” If you have read my previous articles, you know that I have the same opinion. The second is an article by Rutger Bregman, a guy from the Netherlands, who discusses a bunch of research that opened my eyes to another system of welfare (found here). The first was interesting. The second was an epiphany.
This idea of a "basic income" has been around for a while. The idea is that the government pays everyone a small wage that is enough to survive on. Note that I said, "everyone." This means rich and poor alike. Now, I can hear a lot of people asking, "why the rich?" This is a valid question, with a very good explanation. The answer is "privacy." Another answer is cost. It turns out that running a welfare system that has a lot of restrictions and requirements costs a lot of money. In May 2009, London did an experiment where the city gave thirteen homeless men 3,000 pounds (around $4,500 in U.S. dollars at the time), with no strings attached. Now the biggest argument against a government provided basic income in that it will cause a lot of people to quit their jobs and freeload off the state. Out of these thirteen guys, eleven of them dramatically improved their lives. They got housing, some took classes to learn useful skills, some got treatment for drug abuse (one quit heroin), and they made plans for the future. Eleven of thirteen is pretty good odds. The best part is that the 50,000 pound expense of giving these guys the money (a bit was spent on administrative and research costs) actually saved the city around 350,000 pounds that would have been spent by law enforcement dealing with these guys. It turns out that this argument that a basic wage will reduce incentive to work is wrong.
This London experiment is neither the only, nor the most recent experiment of this type. Manitoba, Canada funded an experiment dubbed "Mincome" where an entire town was placed under something like a basic income for four years. The requirement of the experiment was that it would ensure no one would live below the poverty level. This resulted in around 1,000 families getting some kind of government pay check. Evidently the results of the experiment were hidden by the provincial government until 2009. The research showed that very few people decided to quit working. Further, it showed that a number of the residents started their own businesses, because the basic income reduced the risk substantially. Ultimately, it turns out that the experiment was an awesome success.
There are plenty of other instances showing the same results. In Kenya, a guy was randomly given a year's pay, and used it to buy a taxi motorcycle, so he could increase his income from $2 a day to $6 to $9 a day. There is also evidence that he used some of the money to help neighbors start their own businesses and fix their houses. Uganda once gave $400 each to 12,000 youths, which dramatically improved their chances of getting education and a good job. Uganda also gave $150 each to 1,800 poor women, which ultimately resulted in permanent income increases. In the last case, it was discovered that while the women who accepted support from aid workers turned out better, the difference would have been even more had the salaries from the aid workers been given to the women, instead of the support.
Another argument against a basic income is that without restrictions, many people would spend the money on things that are not necessities and would still live in poverty conditions. The London case disproved that pretty effectively. It turns out that homeless people buy alcohol because they cannot afford anything else. Give them a large amount of money, and they have a very high probability of spending it wisely (most of the London guys spent only 800 pounds of the money in the first year, saving the rest). Evidently poor people are poor because they do not have enough money, not because they are too stupid to use it wisely. If you give them enough money, they will use it to get out of poverty long term.
The last serious argument against a basic income is the massive cost. One estimation of the U.S. is that a basic income system would cost around $175 billion a year. Contrast this with our $700 billion a year military, and it does not seem like so much. It gets better though. The Mincome experiment showed crime reductions. This means reduced law enforcement costs and reduced crime recovery costs. The London experiment showed a dramatic reduction in costs from getting homeless people off the street, to the point where the savings was seven times the cost of the program. There are also clear economic advantages to providing enough money to everyone. Economic condition tends to be based on how much money flow there is. An economy where a large portion of the money goes to CEOs, which then save or invest the money, is weaker than an economy where most of the money continues to circulate back into the economy (and do not try to tell me that investing is the same thing; investing is taking the money at the top, and transferring it one level down, so it can sift back up one level). Basic income systems have been shown to dramatically improve economies. The last financial benefit of a basic income system is the cost savings. A welfare system that has many restrictions and regulations requires a great deal of administration. This administration is expensive. Instead of paying a large number of employees well over the poverty level (government employees), get rid of the administration, and just send out checks to everyone. No more paper work, no more employees doing hours of work to decide who is allowed to have welfare and who is not, no more rent or maintenance costs for government office buildings for the welfare workers, no more expensive forensics to identify welfare fraud, and no more lawyer fees to handle cases that have been identified. That is a lot of savings. Getting rid of the huge amount of infrastructure for administering welfare would save a huge amount of money. Admittedly, the cost will still be a lot, but nothing like opponents claim.
So, here is how this works: You give a basic income to everyone. The money comes from businesses and those who have extremely high income (for those with huge incomes, it is more like an extra tax deduction). The businesses do not suffer from it though, because minimum wage is abolished. Ok, so here I identify a major conservative upside. Most conservatives oppose minimum wage, or at least oppose a fair minimum wage. A basic income makes minimum wage obsolete. With a basic income, everyone gets enough to survive, without working, so even at $1 a day, they can survive. This also reduces the need for other workplace regulation. If I can walk out whenever I want with low risk, my employer had darn well better make sure the workplace is safe. Also, if my employer makes unwanted advances (ok, I am a guy, so this is far less likely, but the point still stands), I can just quit. Instead of expensive legal fees, for a case that I may or may not win (and I am almost guaranteed to loose my job despite anti-retribution laws), I can just leave (if I like the job that much, I can still press charges, but if I do still manage to get fired, at least I do not starve). One of the biggest benefits observed in experiments is the creation of small businesses. The risk with starting a business is that if it fails, I starve. A basic income eliminates that risk. Now, maybe I will have to move to a smaller house, but there is still very low risk. As I mentioned, this has been observed. Now, small businesses create jobs (in fact, a majority of U.S. jobs are provided by small businesses). A basic income even creates more jobs! Yes, it is true. A basic income increases the number of small businesses and improves the economy, which ultimately creates more jobs. Also, a very small percentage of people will quit their jobs if given enough to stay out of poverty. This will open up a few more jobs. So yes, there will be more up front costs, but a better economy means more tax revenue. A basic income could also simplify the tax system, because by not taxing the basic income, people are ensured enough to get by. Anything over that could be taxed with few deductions, because the government no longer has to worry about anyone getting enough. Things like the Earned Income Tax Credit and the Child Tax Credit could be eliminated (along with the expensive infrastructure necessary to support them) without hurting anyone. The basic income does not need to be reported, because the government already knows, and the IRS can ignore it, because it does not make any difference. The benefits appear to severely outweigh the costs.
Now let us look at privacy. I may have mentioned this already, but one concern is that a basic income would violate privacy. First, you already report all of your income to the IRS, where is the privacy right now? Now, a well implemented basic income system would actually improve privacy. The requirement is that the basic income is unconditional. A murderer, child molester, a thief, a gang leader, or anything else, all get the basic income. The reason is that it would be a very bad idea to give the government the power to control people by restricting their basic income benefits. Now, here is the privacy: If you are currently on welfare, you will sometimes be asked if there are guns in the home. This is a way that the government can violate privacy, and it could allow the government to compile a list of poor people that are armed. A basic income that is unconditional will not do this. In fact, because it replaces welfare, a basic income removes requirements for government welfare agencies to know your financial state (the IRS still knows). No one is going to ask how much assets you have that are not in the bank (Food Stamps and Medicaid interviewers are required to record this information). No government office is going to record how much money you made in the last six months as a qualification for welfare. An unconditional basic income will dramatically improve personal privacy.
Evidently the U.S. actually almost implemented this idea several decades ago. Around 80% of U.S. citizens supported it. The House of Representatives actually passed the bill. The Senate did not though. It went back and forth, and as Reagan commented, "In the sixties we waged a war on poverty, and poverty won." What killed it? The divorce rate in Seattle allegedly went up by 50%. The great thing is, years later it was discovered that the numbers were reported wrong, and the divorce rate had not changed at all. So, what killed it? Poor reporting. The U.S. was almost the first large scale experiment with the basic income, an experiment which has never failed on small scales. Where would we be now, with all of the benefits of this system?
What should we do about this? Dump the horrible mess that is Obamacare (which still has not born good fruit). Abolish our current broken welfare system that effectively traps people in poverty. Lay off the huge number of people employed in rewarding poor people for trying to get jobs that do not exist. Tear down the unstable infrastructure that is helping businesses keep the American people in bondage. Finally, once and for all, establish what poverty really is, and define a poverty level that will be regularly reassessed and that is accurate. Then, take all of the money currently going to welfare, and apply it to the basic income. According to this, that would covers almost half of it (it covers about $80 billion, of around $170 billion; this does not include administrative costs of Obamacare). The other half could come from the military (it would be about one eighth of the military budget), until the government reduces the tax exemptions for large businesses. In fact, even a slight reduction in tax exemptions for large businesses would cover the entire basic income.
We can afford this. In fact, it is possible that we cannot afford not to do this. It would eliminate a lot of the problems with our current system. It would raise our so called civilization to an actual civilization where we do not let anyone starve. It would give people the opportunity to do the work they want to do, instead of work at a job they hate, but that they are stuck at. The moral increase would improve productivity. It would eliminate the huge overhead of our current welfare system, and it would increase our privacy from the government. (Worried about "big government?" This will make so much of our current government welfare infrastructure obsolete that it will significantly reduce the size of our government.) It would improve our economy by a huge amount. It could even end slavery in the U.S., once and for all. And, it would not increase the divorce rate by 50% (I hope I am not wrong; I would hate to feel stupid). A basic income is really the answer to most of our financial and economical problems in the U.S. And this time, my claim is not just based on logic and observation, it is also based on a good body of strong evidence.
Recently I have argued that we need to improve welfare enough that it will keep people out of poverty. I showed how the U.S. government's definition of poverty is almost half the actual poverty level, and I showed how the current welfare system seems to take advantage of this to trap people in poverty. I argued that we need to fix the legal definition of poverty, and I argued that we need to then fix the welfare programs to take the new definition into account. I also argued that we need to raise minimum wage to reflect the actual poverty level. I may have also argued that Congress needs to regularly reassess the defined poverty level and change the definition if necessary. My take on the current situation changed today, and I find that some of my arguments may be obsolete. I would like to discuss why this is.
Today, I read two things (brought to my attention by a friend). The first is a letter by a guy who quit his job and started writing for a living (found here). This man, Chuck Bukowski, compared the current state of the U.S. economy to slavery, and he once said, “Slavery was never abolished, it was only extended to include all the colors.” If you have read my previous articles, you know that I have the same opinion. The second is an article by Rutger Bregman, a guy from the Netherlands, who discusses a bunch of research that opened my eyes to another system of welfare (found here). The first was interesting. The second was an epiphany.
This idea of a "basic income" has been around for a while. The idea is that the government pays everyone a small wage that is enough to survive on. Note that I said, "everyone." This means rich and poor alike. Now, I can hear a lot of people asking, "why the rich?" This is a valid question, with a very good explanation. The answer is "privacy." Another answer is cost. It turns out that running a welfare system that has a lot of restrictions and requirements costs a lot of money. In May 2009, London did an experiment where the city gave thirteen homeless men 3,000 pounds (around $4,500 in U.S. dollars at the time), with no strings attached. Now the biggest argument against a government provided basic income in that it will cause a lot of people to quit their jobs and freeload off the state. Out of these thirteen guys, eleven of them dramatically improved their lives. They got housing, some took classes to learn useful skills, some got treatment for drug abuse (one quit heroin), and they made plans for the future. Eleven of thirteen is pretty good odds. The best part is that the 50,000 pound expense of giving these guys the money (a bit was spent on administrative and research costs) actually saved the city around 350,000 pounds that would have been spent by law enforcement dealing with these guys. It turns out that this argument that a basic wage will reduce incentive to work is wrong.
This London experiment is neither the only, nor the most recent experiment of this type. Manitoba, Canada funded an experiment dubbed "Mincome" where an entire town was placed under something like a basic income for four years. The requirement of the experiment was that it would ensure no one would live below the poverty level. This resulted in around 1,000 families getting some kind of government pay check. Evidently the results of the experiment were hidden by the provincial government until 2009. The research showed that very few people decided to quit working. Further, it showed that a number of the residents started their own businesses, because the basic income reduced the risk substantially. Ultimately, it turns out that the experiment was an awesome success.
There are plenty of other instances showing the same results. In Kenya, a guy was randomly given a year's pay, and used it to buy a taxi motorcycle, so he could increase his income from $2 a day to $6 to $9 a day. There is also evidence that he used some of the money to help neighbors start their own businesses and fix their houses. Uganda once gave $400 each to 12,000 youths, which dramatically improved their chances of getting education and a good job. Uganda also gave $150 each to 1,800 poor women, which ultimately resulted in permanent income increases. In the last case, it was discovered that while the women who accepted support from aid workers turned out better, the difference would have been even more had the salaries from the aid workers been given to the women, instead of the support.
Another argument against a basic income is that without restrictions, many people would spend the money on things that are not necessities and would still live in poverty conditions. The London case disproved that pretty effectively. It turns out that homeless people buy alcohol because they cannot afford anything else. Give them a large amount of money, and they have a very high probability of spending it wisely (most of the London guys spent only 800 pounds of the money in the first year, saving the rest). Evidently poor people are poor because they do not have enough money, not because they are too stupid to use it wisely. If you give them enough money, they will use it to get out of poverty long term.
The last serious argument against a basic income is the massive cost. One estimation of the U.S. is that a basic income system would cost around $175 billion a year. Contrast this with our $700 billion a year military, and it does not seem like so much. It gets better though. The Mincome experiment showed crime reductions. This means reduced law enforcement costs and reduced crime recovery costs. The London experiment showed a dramatic reduction in costs from getting homeless people off the street, to the point where the savings was seven times the cost of the program. There are also clear economic advantages to providing enough money to everyone. Economic condition tends to be based on how much money flow there is. An economy where a large portion of the money goes to CEOs, which then save or invest the money, is weaker than an economy where most of the money continues to circulate back into the economy (and do not try to tell me that investing is the same thing; investing is taking the money at the top, and transferring it one level down, so it can sift back up one level). Basic income systems have been shown to dramatically improve economies. The last financial benefit of a basic income system is the cost savings. A welfare system that has many restrictions and regulations requires a great deal of administration. This administration is expensive. Instead of paying a large number of employees well over the poverty level (government employees), get rid of the administration, and just send out checks to everyone. No more paper work, no more employees doing hours of work to decide who is allowed to have welfare and who is not, no more rent or maintenance costs for government office buildings for the welfare workers, no more expensive forensics to identify welfare fraud, and no more lawyer fees to handle cases that have been identified. That is a lot of savings. Getting rid of the huge amount of infrastructure for administering welfare would save a huge amount of money. Admittedly, the cost will still be a lot, but nothing like opponents claim.
So, here is how this works: You give a basic income to everyone. The money comes from businesses and those who have extremely high income (for those with huge incomes, it is more like an extra tax deduction). The businesses do not suffer from it though, because minimum wage is abolished. Ok, so here I identify a major conservative upside. Most conservatives oppose minimum wage, or at least oppose a fair minimum wage. A basic income makes minimum wage obsolete. With a basic income, everyone gets enough to survive, without working, so even at $1 a day, they can survive. This also reduces the need for other workplace regulation. If I can walk out whenever I want with low risk, my employer had darn well better make sure the workplace is safe. Also, if my employer makes unwanted advances (ok, I am a guy, so this is far less likely, but the point still stands), I can just quit. Instead of expensive legal fees, for a case that I may or may not win (and I am almost guaranteed to loose my job despite anti-retribution laws), I can just leave (if I like the job that much, I can still press charges, but if I do still manage to get fired, at least I do not starve). One of the biggest benefits observed in experiments is the creation of small businesses. The risk with starting a business is that if it fails, I starve. A basic income eliminates that risk. Now, maybe I will have to move to a smaller house, but there is still very low risk. As I mentioned, this has been observed. Now, small businesses create jobs (in fact, a majority of U.S. jobs are provided by small businesses). A basic income even creates more jobs! Yes, it is true. A basic income increases the number of small businesses and improves the economy, which ultimately creates more jobs. Also, a very small percentage of people will quit their jobs if given enough to stay out of poverty. This will open up a few more jobs. So yes, there will be more up front costs, but a better economy means more tax revenue. A basic income could also simplify the tax system, because by not taxing the basic income, people are ensured enough to get by. Anything over that could be taxed with few deductions, because the government no longer has to worry about anyone getting enough. Things like the Earned Income Tax Credit and the Child Tax Credit could be eliminated (along with the expensive infrastructure necessary to support them) without hurting anyone. The basic income does not need to be reported, because the government already knows, and the IRS can ignore it, because it does not make any difference. The benefits appear to severely outweigh the costs.
Now let us look at privacy. I may have mentioned this already, but one concern is that a basic income would violate privacy. First, you already report all of your income to the IRS, where is the privacy right now? Now, a well implemented basic income system would actually improve privacy. The requirement is that the basic income is unconditional. A murderer, child molester, a thief, a gang leader, or anything else, all get the basic income. The reason is that it would be a very bad idea to give the government the power to control people by restricting their basic income benefits. Now, here is the privacy: If you are currently on welfare, you will sometimes be asked if there are guns in the home. This is a way that the government can violate privacy, and it could allow the government to compile a list of poor people that are armed. A basic income that is unconditional will not do this. In fact, because it replaces welfare, a basic income removes requirements for government welfare agencies to know your financial state (the IRS still knows). No one is going to ask how much assets you have that are not in the bank (Food Stamps and Medicaid interviewers are required to record this information). No government office is going to record how much money you made in the last six months as a qualification for welfare. An unconditional basic income will dramatically improve personal privacy.
Evidently the U.S. actually almost implemented this idea several decades ago. Around 80% of U.S. citizens supported it. The House of Representatives actually passed the bill. The Senate did not though. It went back and forth, and as Reagan commented, "In the sixties we waged a war on poverty, and poverty won." What killed it? The divorce rate in Seattle allegedly went up by 50%. The great thing is, years later it was discovered that the numbers were reported wrong, and the divorce rate had not changed at all. So, what killed it? Poor reporting. The U.S. was almost the first large scale experiment with the basic income, an experiment which has never failed on small scales. Where would we be now, with all of the benefits of this system?
What should we do about this? Dump the horrible mess that is Obamacare (which still has not born good fruit). Abolish our current broken welfare system that effectively traps people in poverty. Lay off the huge number of people employed in rewarding poor people for trying to get jobs that do not exist. Tear down the unstable infrastructure that is helping businesses keep the American people in bondage. Finally, once and for all, establish what poverty really is, and define a poverty level that will be regularly reassessed and that is accurate. Then, take all of the money currently going to welfare, and apply it to the basic income. According to this, that would covers almost half of it (it covers about $80 billion, of around $170 billion; this does not include administrative costs of Obamacare). The other half could come from the military (it would be about one eighth of the military budget), until the government reduces the tax exemptions for large businesses. In fact, even a slight reduction in tax exemptions for large businesses would cover the entire basic income.
We can afford this. In fact, it is possible that we cannot afford not to do this. It would eliminate a lot of the problems with our current system. It would raise our so called civilization to an actual civilization where we do not let anyone starve. It would give people the opportunity to do the work they want to do, instead of work at a job they hate, but that they are stuck at. The moral increase would improve productivity. It would eliminate the huge overhead of our current welfare system, and it would increase our privacy from the government. (Worried about "big government?" This will make so much of our current government welfare infrastructure obsolete that it will significantly reduce the size of our government.) It would improve our economy by a huge amount. It could even end slavery in the U.S., once and for all. And, it would not increase the divorce rate by 50% (I hope I am not wrong; I would hate to feel stupid). A basic income is really the answer to most of our financial and economical problems in the U.S. And this time, my claim is not just based on logic and observation, it is also based on a good body of strong evidence.
31 December 2013
Mexican Slavery
I don't think I have ever brought up this topic before. It is one of the most controversial topics today. It also turns out that a vast majority of people, on both sides, have no clue what it really entails. Today, I am going to discuss illegal immigration.
The other day, I was reading about illegal immigration, for a class I was taking. I forget what the article was about, but I started reading through some of the comments left by readers. One lady said that she was against illegal immigration, because it takes jobs away from legal American citizens. She then showed her complete ignorance by stating that she has a friend who would gladly take one of the construction jobs currently held by an illegal Mexican immigrant. The construction industry in the U.S. is fairly well regulated. Certifications are required for many types of construction work, and most locales have at least three levels of construction code requirements (Federal, state, city, and/or county). Even for construction jobs that do not have Federal requirements, many states require that anyone with less than journeyman status work under a journeyman as an apprentice (I did this on a few occasions doing insulating work with a friend). On average, more than half of construction workers are skilled workers. If they are Mexican, they are very much legal. Maybe some shady backwoods construction jobs hire illegal immigrants, but reputable construction companies don't.
So, the question then is, if there are so many illegal immigrants here, what are the jobs that they are taking? Many are working for small businesses that are not willing to pay minimum wage. It is pretty hard for an illegal immigrant to complain that they are getting ripped off, when they will certainly be thrown out of the country if they do. I wonder if this lady's friend is willing to work as a bagger or cashier at a small grocery store, for $2.50 an hour. That is not where most of the jobs are though. My research found that a vast majority of illegal immigrants in the U.S. are working in one of two industries. In Washington state, many work in the logging industry. In general though, a vast majority work in agriculture. Now, keep in mind that in the U.S., minimum wage does not apply to most agricultural work. The vast majority of illegal workers (including those who return to Mexico after harvest season is over) in the U.S. are doing agricultural work, which pays $2 to $4 an hour and does not violate minimum wage.
Now we can say that Mexican immigrants are taking thousands of agricultural jobs from legal U.S. citizens right? This is actually false. It also turns out that most Americans will not do agricultural work, even if they cannot find any other work. One farm workers organization listed jobs for agricultural work with some very large unemployment organizations, and out of tens to hundreds of thousands of unemployed Americans notified of the openings, a grand total of three responded. These are not jobs that Americans would have if the Mexicans did not do them for cheaper than minimum wage. These are jobs that Americans refuse to do. The evidence shows that most unemployed Americans would rather go on welfare than work in agriculture. The immigrants are not stealing jobs. They are filling a need for labor that no one else is willing to do.
It gets worse though. It also turns out that the reason the above mentioned organization of farm workers started posting job openings is that many Mexicans won't do farm work anymore either. Many of the jobs were filled by Mexicans who live in Mexico and come to the U.S. seasonally to do farm work. The economy in Mexico has improved somewhat, and now many Mexican farm workers have found that they can get higher quality and better paying work staying in Mexico, than working on farms in the U.S. One farmer complained that the lack of workers was going to cause part of his berry harvest to go bad before they could be picked. Similar worries have been heard from other farmers as well. As the economy in Mexico has improved, jobs on U.S. farms have opened up. Unfortunately, few Americans (three, specifically) are willing to do that kind of work. As the Mexican economy continues to improve, we can expect to loose more and more farm workers. Here is the catch: Farm workers are essential to our ability to produce food. Now, last time I checked, 60% of the food produced in the U.S. is exported. So, decreasing production by 60% would not cause us to starve, but it would cause other countries to have food difficulties, and it would force a lot of farms to close, which would eliminate all of the administrative jobs that are held by legal American workers. Obviously, if food production dropped more than that, people in the U.S. would start to starve. In short, without Mexican farm workers, we would loose a large number of jobs that Americans are willing to do, we would loose a major export, we would probably have to start rationing food, and some people would starve because they would not be able to afford the new prices for food.
All of this brings up a lot of questions. The obvious one is, how can we cut down on illegal immigration without destroying our ability to produce enough food for everyone? The solution is even more obvious: Illegal immigration is only illegal because it is illegal. Since it is defined by the fact that it is illegal, making it legal would eliminate the problem entirely. Now, I am not necessarily for opening the borders and walking away. We could, however, make it much easier for honest Mexicans to immigrate. We could even just make it easier to get short term work visas for farm workers.
A second, less obvious question this brings up is, why is minimum wage different for agricultural work? Also, farm workers don't get overtime pay either. Why? The idea with minimum wage is that it is designed to make sure that workers get enough wages for their work to pay for living expenses. The idea with overtime is that more than 8 hours of work a day (or 40 hours a week) is excessive labor, and the employee deserves extra pay for the difficulties caused. Do farm workers somehow have a lower cost of living, such that lower pay is justified? Is farm work so easy that overtime should not apply? The answer is very obviously "no." If we limit farm workers to legal workers (whom the law is designed for), they have the same cost of living as anyone else. Working in agriculture does not magically decrease cost of living. The overtime thing is worse. The reason Americans won't do farm work is that it is grueling labor. Farm work is some of the hardest physical labor available in the U.S. If anyone deserves extra pay for excessive work, it is farm workers. So, the question "why" still stands. The answer is, farming is not as profitable as many other businesses (or, it was not, back when this particular part of labor law was designed; modern industrial farming techniques have dramatically increased profitability of farming). The justification is, this type of business needs the lower minimum wage, and farm workers work 12 to 16 hours a day, almost every day they work. As such, the cost to pay workers fair wages is supposedly too much for farms to handle. Does this really justify blatantly ripping them off though?
This reveals an ethical dilemma. We need food. In fact, food is one place where normal market profit maximization techniques are obviously wrong. Profit maximization math balances demand with price. The problem with doing this for food is that when demand decreases, it means that people are not buying the product, often because they cannot afford it. For food this means that people starve. So, if profit is maximized, around 25% of people will not be able to afford food (this be based on common trends with other products; in the U.S., given that a vast majority of people are in the lower class, it might be closer to 50% or more). Maximizing profit for food forces people to starve. So, the dilemma is this: Allow the food industry to be entirely capitalistic, require farms to pay fair wages, and have a significant percentage of the population starve, or allow farms to pay wages worth far less than the average compensation given to slaves in the Old South (they at least got room and board), to keep food costs low enough that everyone can afford it?
What this really comes down to is, when is the U.S. really going to outlaw slavery? Americans recognize that farm work, at current legal wages, is not much different from slavery. This is part of the reason Americans will not take farm jobs. Many Mexicans are used to conditions worse than slavery, so seasonal slavery on a farm, that actually pays, is better than what they are used to. That still does not make it right though. (Note, if you are sitting there thinking, "It's only slavery if they are forced to work," look up "chattel slavery." That is what you are comparing it to. Chattel slavery is not the only kind of slavery. Voluntary slavery is still slavery.) We managed to outlaw blatant chattel slavery long ago. Now we are battling a different kind of slavery that is much more insidious. Until we recognize it as slavery, the American Dream will be a false hope available only to those who already have it. Let's free the Mexican slaves!
The other day, I was reading about illegal immigration, for a class I was taking. I forget what the article was about, but I started reading through some of the comments left by readers. One lady said that she was against illegal immigration, because it takes jobs away from legal American citizens. She then showed her complete ignorance by stating that she has a friend who would gladly take one of the construction jobs currently held by an illegal Mexican immigrant. The construction industry in the U.S. is fairly well regulated. Certifications are required for many types of construction work, and most locales have at least three levels of construction code requirements (Federal, state, city, and/or county). Even for construction jobs that do not have Federal requirements, many states require that anyone with less than journeyman status work under a journeyman as an apprentice (I did this on a few occasions doing insulating work with a friend). On average, more than half of construction workers are skilled workers. If they are Mexican, they are very much legal. Maybe some shady backwoods construction jobs hire illegal immigrants, but reputable construction companies don't.
So, the question then is, if there are so many illegal immigrants here, what are the jobs that they are taking? Many are working for small businesses that are not willing to pay minimum wage. It is pretty hard for an illegal immigrant to complain that they are getting ripped off, when they will certainly be thrown out of the country if they do. I wonder if this lady's friend is willing to work as a bagger or cashier at a small grocery store, for $2.50 an hour. That is not where most of the jobs are though. My research found that a vast majority of illegal immigrants in the U.S. are working in one of two industries. In Washington state, many work in the logging industry. In general though, a vast majority work in agriculture. Now, keep in mind that in the U.S., minimum wage does not apply to most agricultural work. The vast majority of illegal workers (including those who return to Mexico after harvest season is over) in the U.S. are doing agricultural work, which pays $2 to $4 an hour and does not violate minimum wage.
Now we can say that Mexican immigrants are taking thousands of agricultural jobs from legal U.S. citizens right? This is actually false. It also turns out that most Americans will not do agricultural work, even if they cannot find any other work. One farm workers organization listed jobs for agricultural work with some very large unemployment organizations, and out of tens to hundreds of thousands of unemployed Americans notified of the openings, a grand total of three responded. These are not jobs that Americans would have if the Mexicans did not do them for cheaper than minimum wage. These are jobs that Americans refuse to do. The evidence shows that most unemployed Americans would rather go on welfare than work in agriculture. The immigrants are not stealing jobs. They are filling a need for labor that no one else is willing to do.
It gets worse though. It also turns out that the reason the above mentioned organization of farm workers started posting job openings is that many Mexicans won't do farm work anymore either. Many of the jobs were filled by Mexicans who live in Mexico and come to the U.S. seasonally to do farm work. The economy in Mexico has improved somewhat, and now many Mexican farm workers have found that they can get higher quality and better paying work staying in Mexico, than working on farms in the U.S. One farmer complained that the lack of workers was going to cause part of his berry harvest to go bad before they could be picked. Similar worries have been heard from other farmers as well. As the economy in Mexico has improved, jobs on U.S. farms have opened up. Unfortunately, few Americans (three, specifically) are willing to do that kind of work. As the Mexican economy continues to improve, we can expect to loose more and more farm workers. Here is the catch: Farm workers are essential to our ability to produce food. Now, last time I checked, 60% of the food produced in the U.S. is exported. So, decreasing production by 60% would not cause us to starve, but it would cause other countries to have food difficulties, and it would force a lot of farms to close, which would eliminate all of the administrative jobs that are held by legal American workers. Obviously, if food production dropped more than that, people in the U.S. would start to starve. In short, without Mexican farm workers, we would loose a large number of jobs that Americans are willing to do, we would loose a major export, we would probably have to start rationing food, and some people would starve because they would not be able to afford the new prices for food.
All of this brings up a lot of questions. The obvious one is, how can we cut down on illegal immigration without destroying our ability to produce enough food for everyone? The solution is even more obvious: Illegal immigration is only illegal because it is illegal. Since it is defined by the fact that it is illegal, making it legal would eliminate the problem entirely. Now, I am not necessarily for opening the borders and walking away. We could, however, make it much easier for honest Mexicans to immigrate. We could even just make it easier to get short term work visas for farm workers.
A second, less obvious question this brings up is, why is minimum wage different for agricultural work? Also, farm workers don't get overtime pay either. Why? The idea with minimum wage is that it is designed to make sure that workers get enough wages for their work to pay for living expenses. The idea with overtime is that more than 8 hours of work a day (or 40 hours a week) is excessive labor, and the employee deserves extra pay for the difficulties caused. Do farm workers somehow have a lower cost of living, such that lower pay is justified? Is farm work so easy that overtime should not apply? The answer is very obviously "no." If we limit farm workers to legal workers (whom the law is designed for), they have the same cost of living as anyone else. Working in agriculture does not magically decrease cost of living. The overtime thing is worse. The reason Americans won't do farm work is that it is grueling labor. Farm work is some of the hardest physical labor available in the U.S. If anyone deserves extra pay for excessive work, it is farm workers. So, the question "why" still stands. The answer is, farming is not as profitable as many other businesses (or, it was not, back when this particular part of labor law was designed; modern industrial farming techniques have dramatically increased profitability of farming). The justification is, this type of business needs the lower minimum wage, and farm workers work 12 to 16 hours a day, almost every day they work. As such, the cost to pay workers fair wages is supposedly too much for farms to handle. Does this really justify blatantly ripping them off though?
This reveals an ethical dilemma. We need food. In fact, food is one place where normal market profit maximization techniques are obviously wrong. Profit maximization math balances demand with price. The problem with doing this for food is that when demand decreases, it means that people are not buying the product, often because they cannot afford it. For food this means that people starve. So, if profit is maximized, around 25% of people will not be able to afford food (this be based on common trends with other products; in the U.S., given that a vast majority of people are in the lower class, it might be closer to 50% or more). Maximizing profit for food forces people to starve. So, the dilemma is this: Allow the food industry to be entirely capitalistic, require farms to pay fair wages, and have a significant percentage of the population starve, or allow farms to pay wages worth far less than the average compensation given to slaves in the Old South (they at least got room and board), to keep food costs low enough that everyone can afford it?
What this really comes down to is, when is the U.S. really going to outlaw slavery? Americans recognize that farm work, at current legal wages, is not much different from slavery. This is part of the reason Americans will not take farm jobs. Many Mexicans are used to conditions worse than slavery, so seasonal slavery on a farm, that actually pays, is better than what they are used to. That still does not make it right though. (Note, if you are sitting there thinking, "It's only slavery if they are forced to work," look up "chattel slavery." That is what you are comparing it to. Chattel slavery is not the only kind of slavery. Voluntary slavery is still slavery.) We managed to outlaw blatant chattel slavery long ago. Now we are battling a different kind of slavery that is much more insidious. Until we recognize it as slavery, the American Dream will be a false hope available only to those who already have it. Let's free the Mexican slaves!
20 November 2013
Proud to Work 80 Hours a Week
If you just bragged on Facebook or Twitter that you or your spouse works 80 hours a week just to get by, this is for you. If you are not that person, read on anyway, and enjoy the show.
Jane McGonigial, a rather well known woman who works in the video game industry and who has started doing research on the effects of games on humans, has given a number of TED talk which I highly recommend watching. In one of these videos, she describes some research she was involved with. In this research, a number of nursing home residents were asked what their biggest regrets were. The two most common answers were, spending too much time working and spending too little time with family. Someone (who I have been unable to identify) once said something to the effect of, "Any fool can learn from his own mistakes; it takes a wise man to learn from the mistakes of others." If you are working 80 hours a week, you should be asking yourself, are you going to be the fool who learns from his own mistakes only after it is too late, or are you going to be the wise man (or woman) who learns from the mistakes of a majority of old people who wish they had spent their lives better?
I also want to point something else out: Even black slaves in the South, before the Civil War, did not typically work 80 hours a week. Slaves were expensive, and owners were fully aware that frequent 16 hour work days would cause injury, making the slaves unable to do their work. Now days, this is not a problem. Most employers do not pay any up front costs, so working people to death is quite profitable, so long as there is a line of replacements waiting outside. If you are working 80 hours a week just to get by, your employer considers you expendable. Does a wise person continue to work a job where the goal is extract as much work as possible before throwing an employee aside and bringing in a fresh one? Further, slaves in the South did not have to worry about where their food was going to come from, or how they were going to make rent next month. It sounds like your employer is great. You are working more than a slave, you get less compensation than a slave, and you do not even get to have the peace of job security. Your life sounds awesome.
So what about the people that are working 80 hours a week, but could get by on less? Can I ask, what is the point? I suppose if you like your job a whole lot, maybe you could justify neglecting family and other relationships to spend all of your time working. And maybe you do not really care about having time to put all of your hard earned money to good use. Oh, and maybe you just do not care about your health either. Actually, you are beginning to sound like someone with severe depression. You should probably get some help for that. In fact, people who spend all of their time working, even if they like their jobs, are at much higher risk for depression than others. Not only does this cause major relationship problems, depression causes reduced productivity. In other words, if you are working 80 hours a week, good luck continuing to be productive enough to keep your job.
There was a time, long ago, when working for someone else was humiliating. The single exception was apprenticeships, where someone was paying for you to work for someone else, in exchange for that person to teach you their craft, so you would never have to work for someone else again. Some jobs were not that bad, for instance, being a banker. Obviously not every banker could afford to open his own bank. The President of the United States (or any other elected government position) is another example. On the whole however, most hired jobs were menial labor or mindless brain work that only the desperate were willing to do. Many people bought land and started their own farms, to avoid the humiliation of working for someone else. These people often worked 60 to 80 hours a week, and those with large families sometimes worked more. They worked for themselves though, and they took pride in the fact that no one was their master. During hard times, these people sometimes had to humble themselves and accept welfare from others, but while they preferred not to, they considered it better than working for someone else. During better times, these people often paid it back by giving to others who were in need. They only ever worked for someone else when there was no other option. Working for someone else was rock bottom.
Now, however, I hear reports of people bragging on Facebook that they spend 80 hours a week working for someone else and barely even get compensated sufficiently to survive! How low has our society sunk that the slave looks down on the freeman? How bad has it gotten that social pressure encourages people to voluntarily become slaves, and people do it? Gone are the days when slaves must be guarded day and night to prevent their escape. Now, slaves will stay in bondage even when there is no legal ownership demanding that they stay. Is this really the American Dream?
It gets worse. The U.S. government has setup programs that make the situation even worse. I would like to believe that this is not intentional, but that might be naive. Our current welfare systems help encourage slavery very effectively. Contrary to popular belief, a majority of people on welfare work. In fact, things like the Earned Income Credit require work to get paid, and most welfare in the U.S. penalizes people who are either not working or who are not looking for work (which is far more work than actually working). So, the government tells us that we can only have sufficient welfare if we are already slaves or if we are trying to become slaves. Worse, if we try to escape slavery by finding a job where fewer hours are required for greater pay, our welfare gets cut off, reducing our net income to below what is sufficient for survival. Slavery may not be explicitly legally enforced, but even the government has designed welfare programs to prevent the escape from slavery. It gets even better than this though. All of that money for the welfare system comes mostly from the middle class. The primary benefit of welfare goes to businesses that do not pay enough for their employees to get by. You might try to claim that welfare is benefiting the employees and not the businesses. You would be wrong. If those employees did not get welfare, what would happen? Many of these people already work multiple jobs, or spend their free time looking for a better job. They do not have time to do even more work. Without welfare, they have three options: keep working for too little to get by and starve to death, quit their jobs and start looking for better work full time (and probably starve to death anyway), or quit their jobs, enjoy life and wait for the end to come (and definitely starve to death). I suppose they could try to get help from family, but the extra strain on their family members is likely to make the poverty spread. Ultimately what happens to the businesses is, they loose all of their employees to starvation, suicide, or just quitting, and the businesses fail. Alternatively, the businesses could raise wages to make up the difference. Now, notice that the business ultimately takes the brunt of the blow if welfare quits. The business fails, even if the ex-employees find a better job, unless the business starts paying higher wages. That welfare money is not helping the slaves so much as it is reducing the costs of the businesses. If businesses fail and demand for their services still exists, they will be replaced by new businesses that will pay sufficient wages, if welfare is removed. Otherwise those new businesses will fail almost immediately. Our current welfare system robs the middle class to make life easier for the slave masters, under the guise of robbing the rich to pay the poor.
Now, do not get me wrong here. I am certainly not suggesting that it would be wise to eliminate government welfare to fix this problem. Notice above that the ultimate consequence for most welfare recipients is starvation and death. This is bad, both morally and economically. I have also discussed the inevitability of welfare as the primary form of income for a majority of the population, as the consequence of rapidly developing technology. Welfare is necessary for the survival of our society, and it is necessary for the support of our ever growing lower class. It needs to be fixed to be more friendly to escaping slavery, not eliminated.
Most Americans seem to have everything working against them. Slave masters have convinced us that slavery is more noble than freedom. This has been so effective that now the slaves brag on Facebook about their horrible work conditions and try to tell free men that they are stupid for recognizing it for what it is. Over the last century, mankind has managed to produce a huge amount of labor saving technology. We also managed to get the legal work week down to 40 hours. This was a long drawn out process that was finally codified into Federal law in 1937. Is has been like this for 76 years, during which time numerous devices have been invented and adopted which dramatically reduce labor. In fact, the computer has replaced inordinate numbers of people, just in the field of mathematical calculations. The need for labor is far lower than it has been ever in the known history of the world. It has been argued, and I agree, that a 20 hour work week should pay enough to support a small family. Given production costs for various goods and their retail prices, large business can easily afford to pay sufficient wages for this, if they quit paying their CEOs and upper managers hundreds or thousands of times what they currently pay their other employees. Instead we have laws and social expectations that keep what is approaching a majority of Americans in poverty.
If you want to complain that you are working 80 hours a week, or even that you and your spouse are working 80 hours a week put together, just to get by, you are telling me that you are stealing needed work from three other families. And one of those families is the person that you just accused of freeloading. Those three families that cannot find decent jobs and are forced to live on crummy government welfare because you are stealing their opportunity to work have far more reason to be angry with you than you have to be with them. At this point, government welfare is designed to make up the difference between what your employer pays and what wages would be fair. By taking four times the work you should just to avoid taking what you consider an unfair handout, you are robbing others of the opportunity to earn money by working and the opportunity to get enough welfare money to make up the difference. That is certainly nothing to brag about. Shame on you!
Jane McGonigial, a rather well known woman who works in the video game industry and who has started doing research on the effects of games on humans, has given a number of TED talk which I highly recommend watching. In one of these videos, she describes some research she was involved with. In this research, a number of nursing home residents were asked what their biggest regrets were. The two most common answers were, spending too much time working and spending too little time with family. Someone (who I have been unable to identify) once said something to the effect of, "Any fool can learn from his own mistakes; it takes a wise man to learn from the mistakes of others." If you are working 80 hours a week, you should be asking yourself, are you going to be the fool who learns from his own mistakes only after it is too late, or are you going to be the wise man (or woman) who learns from the mistakes of a majority of old people who wish they had spent their lives better?
I also want to point something else out: Even black slaves in the South, before the Civil War, did not typically work 80 hours a week. Slaves were expensive, and owners were fully aware that frequent 16 hour work days would cause injury, making the slaves unable to do their work. Now days, this is not a problem. Most employers do not pay any up front costs, so working people to death is quite profitable, so long as there is a line of replacements waiting outside. If you are working 80 hours a week just to get by, your employer considers you expendable. Does a wise person continue to work a job where the goal is extract as much work as possible before throwing an employee aside and bringing in a fresh one? Further, slaves in the South did not have to worry about where their food was going to come from, or how they were going to make rent next month. It sounds like your employer is great. You are working more than a slave, you get less compensation than a slave, and you do not even get to have the peace of job security. Your life sounds awesome.
So what about the people that are working 80 hours a week, but could get by on less? Can I ask, what is the point? I suppose if you like your job a whole lot, maybe you could justify neglecting family and other relationships to spend all of your time working. And maybe you do not really care about having time to put all of your hard earned money to good use. Oh, and maybe you just do not care about your health either. Actually, you are beginning to sound like someone with severe depression. You should probably get some help for that. In fact, people who spend all of their time working, even if they like their jobs, are at much higher risk for depression than others. Not only does this cause major relationship problems, depression causes reduced productivity. In other words, if you are working 80 hours a week, good luck continuing to be productive enough to keep your job.
There was a time, long ago, when working for someone else was humiliating. The single exception was apprenticeships, where someone was paying for you to work for someone else, in exchange for that person to teach you their craft, so you would never have to work for someone else again. Some jobs were not that bad, for instance, being a banker. Obviously not every banker could afford to open his own bank. The President of the United States (or any other elected government position) is another example. On the whole however, most hired jobs were menial labor or mindless brain work that only the desperate were willing to do. Many people bought land and started their own farms, to avoid the humiliation of working for someone else. These people often worked 60 to 80 hours a week, and those with large families sometimes worked more. They worked for themselves though, and they took pride in the fact that no one was their master. During hard times, these people sometimes had to humble themselves and accept welfare from others, but while they preferred not to, they considered it better than working for someone else. During better times, these people often paid it back by giving to others who were in need. They only ever worked for someone else when there was no other option. Working for someone else was rock bottom.
Now, however, I hear reports of people bragging on Facebook that they spend 80 hours a week working for someone else and barely even get compensated sufficiently to survive! How low has our society sunk that the slave looks down on the freeman? How bad has it gotten that social pressure encourages people to voluntarily become slaves, and people do it? Gone are the days when slaves must be guarded day and night to prevent their escape. Now, slaves will stay in bondage even when there is no legal ownership demanding that they stay. Is this really the American Dream?
It gets worse. The U.S. government has setup programs that make the situation even worse. I would like to believe that this is not intentional, but that might be naive. Our current welfare systems help encourage slavery very effectively. Contrary to popular belief, a majority of people on welfare work. In fact, things like the Earned Income Credit require work to get paid, and most welfare in the U.S. penalizes people who are either not working or who are not looking for work (which is far more work than actually working). So, the government tells us that we can only have sufficient welfare if we are already slaves or if we are trying to become slaves. Worse, if we try to escape slavery by finding a job where fewer hours are required for greater pay, our welfare gets cut off, reducing our net income to below what is sufficient for survival. Slavery may not be explicitly legally enforced, but even the government has designed welfare programs to prevent the escape from slavery. It gets even better than this though. All of that money for the welfare system comes mostly from the middle class. The primary benefit of welfare goes to businesses that do not pay enough for their employees to get by. You might try to claim that welfare is benefiting the employees and not the businesses. You would be wrong. If those employees did not get welfare, what would happen? Many of these people already work multiple jobs, or spend their free time looking for a better job. They do not have time to do even more work. Without welfare, they have three options: keep working for too little to get by and starve to death, quit their jobs and start looking for better work full time (and probably starve to death anyway), or quit their jobs, enjoy life and wait for the end to come (and definitely starve to death). I suppose they could try to get help from family, but the extra strain on their family members is likely to make the poverty spread. Ultimately what happens to the businesses is, they loose all of their employees to starvation, suicide, or just quitting, and the businesses fail. Alternatively, the businesses could raise wages to make up the difference. Now, notice that the business ultimately takes the brunt of the blow if welfare quits. The business fails, even if the ex-employees find a better job, unless the business starts paying higher wages. That welfare money is not helping the slaves so much as it is reducing the costs of the businesses. If businesses fail and demand for their services still exists, they will be replaced by new businesses that will pay sufficient wages, if welfare is removed. Otherwise those new businesses will fail almost immediately. Our current welfare system robs the middle class to make life easier for the slave masters, under the guise of robbing the rich to pay the poor.
Now, do not get me wrong here. I am certainly not suggesting that it would be wise to eliminate government welfare to fix this problem. Notice above that the ultimate consequence for most welfare recipients is starvation and death. This is bad, both morally and economically. I have also discussed the inevitability of welfare as the primary form of income for a majority of the population, as the consequence of rapidly developing technology. Welfare is necessary for the survival of our society, and it is necessary for the support of our ever growing lower class. It needs to be fixed to be more friendly to escaping slavery, not eliminated.
Most Americans seem to have everything working against them. Slave masters have convinced us that slavery is more noble than freedom. This has been so effective that now the slaves brag on Facebook about their horrible work conditions and try to tell free men that they are stupid for recognizing it for what it is. Over the last century, mankind has managed to produce a huge amount of labor saving technology. We also managed to get the legal work week down to 40 hours. This was a long drawn out process that was finally codified into Federal law in 1937. Is has been like this for 76 years, during which time numerous devices have been invented and adopted which dramatically reduce labor. In fact, the computer has replaced inordinate numbers of people, just in the field of mathematical calculations. The need for labor is far lower than it has been ever in the known history of the world. It has been argued, and I agree, that a 20 hour work week should pay enough to support a small family. Given production costs for various goods and their retail prices, large business can easily afford to pay sufficient wages for this, if they quit paying their CEOs and upper managers hundreds or thousands of times what they currently pay their other employees. Instead we have laws and social expectations that keep what is approaching a majority of Americans in poverty.
If you want to complain that you are working 80 hours a week, or even that you and your spouse are working 80 hours a week put together, just to get by, you are telling me that you are stealing needed work from three other families. And one of those families is the person that you just accused of freeloading. Those three families that cannot find decent jobs and are forced to live on crummy government welfare because you are stealing their opportunity to work have far more reason to be angry with you than you have to be with them. At this point, government welfare is designed to make up the difference between what your employer pays and what wages would be fair. By taking four times the work you should just to avoid taking what you consider an unfair handout, you are robbing others of the opportunity to earn money by working and the opportunity to get enough welfare money to make up the difference. That is certainly nothing to brag about. Shame on you!
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