Wednesday, October 01, 2008

Labor Day and Freedom - Art Carden - Mises Institute

Art Carden provides words of wisdom on the true source of wealth and private contracts between employer and employee.


What creates wealth, though, is the capital investments and technological changes that allow us to produce more and more with less and less, to adapt the terminology of mid-20th-century economist Joseph A. Schumpeter. Labor is important, but what makes us rich is the capital and technology that make labor more productive...

The idea that collective bargaining was necessary to prevent worker exploitation is a historical myth. Therefore, if anything should be looked at critically, it is the fact that Tyson is essentially coerced via New Deal–era Federal legislation into bargaining with the union, which restricts their options considerably...

This illustrates an important principle about freedom. Ignoring for now how unions distort markets, the sanctity of private contracting is part of the essence of America. Whether a firm and an employee wish to agree to let people have time off for Christmas, Eid el-Fitr, Yom Kippur, Kwanzaa, or Festivus is between the firm and the employee. Firms hire managers to make those kinds of decisions, and as a private citizen, I do not have the right to interfere.

We can, on grounds of personal liberty and economic wisdom, dispute the workers' right to extract concessions from their employers. This isn't the criticism people are making, though. The bargains the firm makes with its workers are nobody else's business. There is no One Right Way to do things, and I, as an interested observer in Memphis, cannot tell factory workers in Shelbyville how they can and cannot write their contracts.


Labor Day and Freedom - Art Carden - Mises Institute

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