January 5, 2014 by David K. Sutton
The Free Market Has Spoken, And It Had Nothing To Say About Economic Inequality
One of the tenets of free market ideology is consumer choice. The idea goes like this. Empower citizens to make their own decisions and they will have greater freedom, greater prosperity, and businesses will live or die at the will of the consumer. Therefore, corporations and executives are in effect beholden to the consumer. Sounds good right? Who could be against that?
Well, here’s the problem.
In most situations choice is an illusion, particularly in industries where there are only a few big corporations in competition. And equating consumer choice with your freedom as a citizen of the United States is equally as flawed. To have a true free market would mean customers have as much information about the consumer choices they are making as the companies making the products. But we know this is almost never the case. And to have a true fee market would mean the average customer would have as much sway on regulatory legislation as corporations and wealthy executives. But again, is this ever the case? Of course not. So is it really a free market?
Yes, capitalism has overall been good to the consumer, even with the illusion of choice. But capitalism, at least the type of capitalism practiced over the past several decades, has not been good to the citizen. And the free market ideologues serving as governors and on state legislatures, you know, the ones trying to bust public unions, are further eroding one of the things that made citizenship of this country so great, the promise of opportunity and a fair wage.
The “middle class” myth: Here’s why wages are really so low today – Salon.com — The greatest victory of the anti-labor movement has not been in busting industries traditionally organized by unions. That’s unnecessary. Those jobs have disappeared as a result of automation and outsourcing to foreign countries. In the U.S., steel industry employment has declined from 521,000 in 1974 to 150,000 today.
Yeah, you can instead blame that on free trade. I’m not sure where I fall on this subject, but clearly free trade, and a globalized economy have led to the outsourcing of well-paying manufacturing jobs overseas where they pay workers pennies on the dollar.
“When I joined the company, it had 28,000 employees,” said George Ranney, a former executive at Inland Steel, an Indiana mill that was bought out by ArcelorMittal in 1998. “When I left, it had between 5,000 and 6,000. We were making the same amount of steel, 5 million tons a year, with higher quality and lower cost.”
The anti-labor movement’s greatest victory has been in preventing the unionization of the jobs that have replaced well-paying industrial work. Stanley was lucky: After Wisconsin Steel shut down in 1980, a casualty of obsolescence, he bounced through ill-paying gigs hanging sheetrock and tending bar before finally catching on as a plumber for the federal government. The public sector is the last bastion of the labor movement, with a 35.9 percent unionization rate. But I know other laid-off steelworkers who ended their working lives delivering soda pop or working as security guards.
There is no question that the decline in unionized jobs has contributed to wage stagnation. Unfortunately this is not a problem that is likely to be solved anytime soon, and there’s one simple reason — contempt.
Because many people have such contempt for others who benefit from union membership, we are not likely to see a reversal in union busting anytime soon. It’s remarkable the level of mockery and scorn lobbed at unions and their members by people who are essentially jealous. Instead of hating on others, maybe you need to recognize that your attitude could be part of the reason your wage isn’t higher.