Tuesday, October 30, 2012

Interested in a high-paying job in a $400 billion dollar industry?

Thought so . . .

No jobs in post-industrial America?

True, but no worries. Stop whining.

No experience necessary, $1000 an hour starting pay.

Learn more here: http://m.youtube.com/#/watch?feature=player_embedded&v=AxRVhgbVN9o&desktop_uri=%2Fwatch%3Ffeature%3Dplayer_embedded%26v%3DAxRVhgbVN9o

Wednesday, October 24, 2012

"Unions - Collectivism Gone Awry"

As many of you know, I wrote for several publications, and often use that fact to excuse my absence from this blog. One of those publications is "The Dollar Vigilante," run by Jeff Berwick. Recently, he wrote a piece on labor organizations that I felt I should share here. And so I am. Enjoy.

URL: http://dollarvigilante.com/blog/2012/10/22/unions-another-form-of-collectivism-gone-awry.html

Monday, October 22, 2012

As the snow already has begun to fall across much of the expanse of Canada, the weather has settled into a deep freeze (-20C, -4F overnight in Calgary this week) and the sun shrinks into the distance, a faint light mocking you for living so far away from it, there is usually one thing that makes living in North America's version of Siberia possible. Hockey.

While I comfortably watch the sport from my outdoor living room on the beach in Acapulco most Canadians have to slog through the snow and mud for eight months of the year just to get a few hours of live entertainment. But this year the NHL has locked out the players in a dispute over salaries. If they can't come to an agreement soon it threatens to wipe out the entire season.

You may think this is a rarity, but in fact this happens quite a bit. There was a player's strike in 1992, a lockout in 1994-1995 and in 2004-2005 the entire season was lost over another lockout. In my opinion, the biggest problem is unions.

Collectivism in almost all things is usually a bad thing and with the most recent NHL lockout, it is once again rearing its ugly head.

To briefly give a summary on what has been going on: the game of hockey has been on a massive upswing over the last few decades. A look at the salary cap increases in just the last few years shows that the total paid to players has nearly doubled in the last 8 years. And that was after rising tremendously during the '90s as well. To show the difference, Wayne Gretzky, the best player to ever play the game, made $1.7 million in 1990. Today, the top paid player is Shea Weber at $14 million. Even allowing for inflation and decreases in real purchasing power, this is a tremendous increase. According to official figures, a basket of goods that cost $100 for Gretzky in 1990 costs about $155 today or about 50% more for Shea Webber who is earning over 700% more money. Bobby Orr, who was the top player of his day in the 1960s made $35,000/year in 1967! That's not even a quarter million dollars today and would have been less than the equivalent of a tenth of Gretzky's salary in 1990.

So, with the total amount of money in the game at massive levels relative to a few decades ago, why can't they seem to get along? If you can believe it, this whole dispute has come down to the owners wanting the players to take a pay cut of 12%. How can a dispute over 12% of pay turn into an entire hockey season lost? Collectivisim!

While I have no problem with people entering into voluntary groups that pretend individual abilities and motivations don't exist... I still think it is pretty stupid to do! And the NHL lockout just adds to my argument. An entire season, and nearly $1.8 billion in total salaries may all go to waste fighting over a 12% pay cut. This would obviously not happen without collectivism. If each player considered himself to be a literal "free agent" and private contractor, then each of them could individually decide, when approached by the owner, whether they want to take the pay cut or decide not to play. Not many people individually would decide not to play over such a relatively small amount, but in unison, and with union "bosses", anything is possible!


As often is the case in the increasily socialist and economically illiterate West, much of the public blames the "greedy owners". But perhaps the funniest comment I saw posted on a newspaper website in relation to the lockout was one man who stated with conviction, "The players should just start their own league!"

Of course there is absolutely no chance of the players starting their own league. That would take a lot of capital, a lot of work and a lot of risk to do. You know, the things those greedy capitalists do. I doubt there is one player in the entire league who would be willing to forfeit his salary every year in order to "invest" it in his own team and to pay everyone's salaries. 18 of the NHL's 30 teams lost money last year... that's a better than 50% chance of losing money. Anyone want to risk their salary on a coin flip? I didn't think so.


Of course, while private unions are mostly terrible there is something even worse. Public unions! And I had the pleasure of working within one at the tender age of 18.

Public unions are ridiculous because the whole concept of unions, according to mostly leftist leaning statists, is that capitalism is evil and the workers/labor must band together or they will get taken advantage of and "exploited". But these same people also say that the reason we need government is because we also cannot allow the markets to be free (capitalism) so we need government to keep greedy capitalists in order by making all kinds of rules and regulations. But, if that is what they really believe, then they should never believe in a public union because the workers work for the government... and according to them, government is good and is actually there to make sure companies don't take advantage of their workers. So, if those people believe in public unions, then they are saying that the government doesn't work to protect workers... so why have it?

After I finally escaped from high school after my 12-year sentence my Dad thought he was doing me a favor by helping me get a job with the city in the mail department. It was only my second week when I proudly walked into the manager's office to let her know I had already found tons of areas of wastage that could save the department a lot of money. In fact, I told her, she probably only needs maybe 2 or 3 people out of the 15 total who worked there. She did agree that someone would have to go. It turned out that person was me for trying to improve the productivity of the mailroom!

I was happy to go. Working inside a union was like living in the Soviet Union. I'd ask, "So, what can I do to get ahead? Take some courses? Work harder?" to which the reply was always a negative. The only way to move up, make more money and have more responsibility was just to be there the longest.

Around the mailroom no one ever seemed happy. They were just putting in their time and waiting for their retirement pension. There was no incentive to work hard... and even if you wanted to, you'd feel like a fool for doing it because the guy beside you who does nothing will make the same or more than you just because he had been there longer.


In the end, unions are about gangsterism and price-fixing. Unions get the state to help force workers into the union collective by making it a condition of employment and thus give up their individual ability to contract with the employer. Unions then get the state to interfere with negotiations between the mob of employees and the employers. The employers lose the right to fire outright the mob of unruly workers when they throw tantrums and refuse to work. Striking workers can refuse to work as they parade around in picket lines...then expect the employers to take them back with their deliberately unreasonable demands met at least halfway.

Unions also demand compensation above what the market says their labor is worth. This is supposed to be to combat the "greed" of the employer, but it just ends up making things more expensive for customers and worse for other non-union workers.

As TDV senior analyst Ed Bugos points out:

"Basically, Rothbard calls unions an instance of a labor 'monopoly'. In a nutshell they can't raise living standards, even by force. All they do is force unemployment, and wage violence against their competition. This causes the displaced labor to depress wages in other industries where unions don't have power, which displaces more workers, etc."

And with union "protections" in place, you can rest assured that incentive to provide quality will be less services and finished goods will be of lower quality than they would without the unions. In short, unions are a bunch of thugs with state guns who abuse customers. They are not protectors of the working poor. Anyone who's spent time as a union employee, especially during a labor strike, can attest to this.


A freed market is going to naturally encourage "workers" to see themselves as independent contractors, not part of a violent, crybaby mob demanding more than the prevailing market rate for their work and using the state to help them get it. If you felt an employer weren't paying you enough or treating you well...you'd find another employer. Remember that this is a voluntary economic relationship goes both ways and the employer isn't a parent. You are free to find someone else with whom to exchange value (service for money). And finding someone else with whom to exchange value shouldn't involve having your whole life turn topsy turvy because your employer is tied to you with various insurance plans and "benefits"! Unionism is an outgrowth of a childish, slave mentality, or more accurately somewhere between slavery and childhood dependence. The union member wants to the right to act up, yet still be coddled, no matter how much they insist they just want what's "fair" and "diginified". It's the way a spoiled adolescent would understand how to earn a living. If they wanted dignity and fairness, they'd put down the state guns and try to create value as best they could and change their economic relathionships when they deemed it necessary.

Again, Ed Bugos (who contributes to the TDV Newsletter):

"Like minimum wage laws: unionism hurts the people that it is apparently intended to help the most. It slows progress and change. It keeps people lazy and keeps them from finding better jobs because the price mechanism is destroyed."

Of course, most modern-day Americans or Canadians can't imagine working in a real free market. They either want to be in a union getting paid unfairly high rates backed by violence...or they want to be corporate drones who depend on their employer for stability and various benefits. Dependence and violence. That's how they view the working world. But it's not entirely their faults. They are in a sense victims of a system that robs them of at least half their income while robbing them of what's left through inflation and economic regression. They are indebted and scared and can't imagine being able to act like independent adults when it comes to employment. Truly sad. It's the rare person who doesn't think like this nowadays. These people tend to be entrepreneurs or if not true entrepreneurs, at least they are very anarcho-libertarian or voluntaryist in their outlook. They're the kind of people for whom we write our weekly newsletter. We really don't know if there are enough of these folks left in the USSA --or even the world-- to prevent general economic collapse, but we aim to make sure that no matter what calamity befalls the world, folks like these get every advantage to thrive no matter what.


Jeff Berwick

Saturday, October 06, 2012

Once upon a time, children, there was a jobs report . . .

(Reprinted from "The Economic Collapse", there titled "A Jobs Report Conspiracy" The link is here: http://theeconomiccollapseblog.com/archives/a-jobs-report-conspiracy

Well, isn't that convenient? The Obama campaign desperately needed the last employment report to be released before the election to show that the unemployment rate had fallen below 8 percent, and somehow it magically happened. Even though non-farm payroll employment only increased by 114,000 last month (not enough to even keep up with population growth), the official unemployment rate fell from 8.1 percent to 7.8 percent. So how did that happen? Well, the unemployment number is not based on the survey of employers that showed that 114,000 jobs were added to the economy last month. Rather it is based on a survey of households. And that survey showed that the total number of Americans employed last month increased by a whopping 873,000 - almost eight times the number that the employer survey showed. That figure for September (873,000) was the biggest one month increase in 29 years. And it just happened to come at the exact perfect time for Barack Obama. So was there a jobs report conspiracy? Examine the evidence and decide for yourself.

The number of Americans with a job fell by 195,000 in July.

Then it fell by another 119,000 in August.

But somehow in September it miraculously exploded in the other direction and 873,000 jobs were added to the economy?

If you believe that, I have a bridge that I want to sell you.

Somehow, the largest increase in jobs in 29 years happened just when Barack Obama needed it the most.

Nah, that doesn't sound fishy to me at all.

We are being told that a big reason for the huge increase was the number of Americans working part-time for "economic reasons". That number surged from 8.0 million in August to 8.6 million in September.

Why the sudden jump?

Nobody can really explain it.

And if you look at the U6 unemployment rate, nothing has really changed at all. U6 is still at 14.7 percent just like it was last month.

But the media is not going to talk about the U6 rate. Instead, all of the headlines are going to be about "7.8 percent".

According to the survey of employers, the U.S. economy added fewer jobs in September than it did in August, and it added fewer jobs in August than it did in July.

So according to the survey of employers, the employment situation in the United States is getting worse.

But according to the household survey, we just had the greatest month of job creation since the first term of Ronald Reagan.

Something does not add up.

And as I have written about previously, the unemployment rate would actually be up around 11 percent instead of 7.8 percent if not for the millions of workers that the government claims "dropped out of the labor force" over the past few years because they became too discouraged to look for work.

So unemployment in America is still a massive crisis, but the media is boldly proclaiming that things are getting better and that we are on the road to recovery.

Of course Obama looks like the cat who ate the canary today. He is just thrilled with the "7.8 percent" number.

But the truth is that according to the employer survey, job growth in the United States is actually slower than last year. The following is from the Calculated Risk blog....

All that said, the economy has only added 1.3 million payroll jobs over the first nine months of the year. At this pace, the economy would only add around 1.8 million private sector jobs in 2012; less than the 2.1 million added in 2011.

Are you starting to see why people are so skeptical of this jobs report?

When the "7.8 percent" figure was released, there was immediately a wave of shock and unbelief throughout the financial world and all over the Internet.

The following is a sampling of skeptical quotes about this jobs report....

Former GE chief Jack Welch

Unbelievable jobs numbers..these Chicago guys will do anything..can't debate so change numbers

Chapwood Capital Investment Management Managing Partner Ed Butowsky

I feel like I’m watching a movie. There is no way in the world these numbers are accurate.

Neil Irwin of the Washington Post

"Weird that payrolls are exactly on forecast but household survey is far better."

Conn Carroll, senior editorial writer for the Washington Examiner

While it is highly improbable that BLS conspired to cook the books, there is still a huge 756,000 job gap between the number of jobs employers told the Labor Department they created in September (114k), and the number of Americans who told the labor department that they got new jobs (873k).

U.S. Representative Allen West

I agree with former GE CEO Jack Welch, Chicago style politics is at work here. Somehow by manipulation of data we are all of a sudden below 8 percent unemployment, a month from the Presidential election. This is Orwellian to say the least and representative of Saul Alinsky tactics from the book "Rules for Radicals"- a must read for all who want to know how the left strategize . Trust the Obama administration? Sure, and the spontaneous reaction to a video caused the death of our Ambassador......and pigs fly.

Gluskin Sheff's David Rosenberg

That the 7.8 percent jobless rate takes it to the level that prevailed when the President took office in January 2009 has raised many an eyebrow. I don't believe in conspiracy theories. But I don't believe in the Household Survey either.

This notoriously volatile indicator has become even more so in recent months. It showed a 195K slide in July and a 119K decline in August, to only then reveal a massive 873K surge in September.

Radio host Laura Ingraham

"Jobs #s from Labor Secretary Hilda Solis are total pro-Obama propaganda--labor force participation rate at 30-yr low. Abysmal!"

Americans for Limited Government

"Either the Federal Reserve, which has its fingers on the pulse of every element of the economy, and the Bureau of Labor Statistics manufacturing survey report are grievously wrong or the number used to calculate the unemployment rate are wrong, or worse manipulated. Given that these numbers conveniently meet Obama's campaign promises one month before the election, the conclusions are obvious."

Rick Santelli of CNBC

"I told you they'd get it under 8 percent — they did! You can let America decide how they got there!"

Of course the backlash in the media against skepticism of the jobs report has been very forceful.

Already, those that are doubtful of the legitimacy of the jobs report are being called "truthers" - as if there is something wrong with wanting to know the truth.

Sadly, that is how things work these days. If you don't like the viewpoint that some people are expressing, you just label them "conspiracy theorists".

And when someone is labeled a "conspiracy theorist", that is code for "that person is so crazy that you should not listen to anything they say".

But the truth is that we live in a world where often people do things that they are not supposed to be doing.

When something rather strange happens, it is not wrong to investigate and try to figure out what is going on.

And this jobs report seems very, very odd.

It sure does seem rather strange that the household survey is showing almost 8 times as many jobs created as the employer survey does.

It sure does seem rather strange that 873,000 more Americans were working in September (the largest increase in 29 years) after decreases in both July and August.

It sure does seem rather strange that the unemployment rate dropped under 8 percent at the exact moment when Barack Obama needed it the most.

But perhaps all of this is just a coincidence.

What do you think?