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9/9/2008 8:57:04 PM

Quote :

"Maybe the French and their fellow Europeans would be just as unemployed with better policies."

Other European countries have similar levels of unionization or collective bargaining yet much lower rates of unemployment than France. That's the problem with your theory. Unions alone obviously don't force high unemployment. The data are clear.

9/9/2008 10:02:50 PM

And I never said unions would produce unemployment. I said they reduce employment in their captive industries; there is a big difference. Workers denied jobs in the auto industry will find work in non-union sectors of the economy, artificially driving down wages in the remaining non-union sectors. Net effect: shifting workers to less productive work and lower wages for those workers not in a union, which in France is 90% of the workforce.

Similarly, while a minimum wage may produce long-term higher unemployment, it should not. Afterall, "unemployment" only includes those actively looking for work. After six months or so of not finding any work, those workers priced out of the legal labor market will no longer be considered 'unemployed' in government statistics, either because they gave up looking, took an illegal job, became criminals, became self employed, joined welfare, or had their phone cut off. Afterall, unemployment statistics are collected by phone survey, those too poor to own a phone are not counted.

9/9/2008 10:45:00 PM

Quote :

"And I never said unions would produce unemployment."

So why, then, have you been harping on France high unemployment rate?

9/9/2008 10:47:27 PM

I shall quote:
"I can see why you love CEPR, since they clearly make the same abhorrent arguments you do. Just the most glarring, your link suggests that the EU central bank keeping interest rates too high somehow explains several decades of high unemployment in France, and not the policy and culture structure of France's labor market"

To spell it out for you, I was attacking the most glarringly abhorrent position taken by your beloved CEPR in that article. I told you this. Why do you now ask me why? Is it because you know that unions would destroy jobs in their captive industries but rather than admit it would prefer to hide behind unemployment statistics which by themselves prove nothing?

9/9/2008 10:55:39 PM

^ I don't know that at all. I see no reason to believe it, as countries with varying levels of unionization have strong economies. And again, remember that the glaringly abhorrent position you attacked wasn't one the article took.

9/9/2008 11:02:08 PM

I shall quote again:
"Why then is Europe’s unemployment currently higher (8.4 percent for the high-income countries of Europe) than that of the United States (4.8 percent)? One possibility is that the European Central Bank (ECB) has kept interest rates higher than it should have in recent years."
They made two glarring mistakes. First, they ignored history; Europe's unemployment rate has been higher than America's for decades, not just since the ECB kept interest rates higher than it should (in the authors opinion). As a result, they have mixed up cause and effect: the differential could not have been caused by the European Central Bank, since the ECB did not exist for much of the time of the differential. I hope this is the last I need to say about that.

There is no logical reason why a highly unionized country would not have a 'strong economy'. It is the purpose of the floating exchange rate system to push all economies in an interconnected world toward their natural rate of unemployment in the long run. What we should expect to see is a lower GDP per capita if I am right that regulations and unions curtail productivity, which we have (France's GDP per capita is roughly 73% that of the United States).
http://www.economicshelp.org/uploaded_images/uk-france-719448.gif

Nevertheless, you see no reason to accept logic when you yourself have belief on your side. Finally we arrive at the cause of the disagreement. I accept the deductive power of reason while you reject it in favor of belief. So be it; but next time, could you start with that so we all save time?

9/9/2008 11:19:18 PM

My current company which will remain nameless has a majority unionized at a manufacturing plant here on the east coast of NC. Our company is a rather good relationship with the union. Even though i am only an entry level engineer, I am considered "management" for union purposes and serve no role nor get any benefits directly.

Just from my observations though there are some benefits I see and some disadvantages. Even though it does not effect me; i do respect the idea of the union. The union provides power and protection for the common worker to as a "strength in numbers" negotiate wage and act against unfair management principles. On the other hand though from the "Management Engineer side it does come some inefficiency. Workers with multiple years of service essentially have a quasi-tenure. Often the older crowd not the young people are the ones guilty of 'slacking' off since they have little fear of being laid off or fired as long as they perform the minimum. Also as an electrical engineer, because their is a risk of a "files of grievance", I can not perform certain repairs/maintenance. Instead I have to call and wait for an electrician. As otherwise I would be taking their job.

Never the less I find a union as a 'free market' alternative to have the fucking gov't step in with shit like OSHA and regulate industries. Much would I rather have unions more prevalent than more government arm-chair labor activists regulating minimum wages and corporate policies. If workers want to band together to negotiate wages than so be it. Why should we hold a double standard deciding against orgainizations created to benefit labor workers while lobbyists in Washington press legislation to benefit Big Business. Where I draw the line is; I DO favor "right to work" like we have in NC to prevent barriers from employment reliant on union membership. At this point the union oversteps in my opinion its authority the same way as often we gesture the gov't gets to involved or the Big Business Fucks the little guy. Everything is about balance.

After all even in mainstream politics the grass root consensus can never financially but out a vote from a deep pocket lobbyist. When it comes to gov't the avg. man has the "say" it does b.c of shear numbers.

[Edited on September 9, 2008 at 11:38 PM. Reason : l]

9/9/2008 11:29:28 PM

Quote :

"They made two glarring mistakes."

No, they didn't. You're turning the quote into something it's not.

Quote :

"First, they ignored history; Europe's unemployment rate has been higher than America's for decades, not just since the ECB kept interest rates higher than it should (in the authors opinion)."

Reading the first sentence you quoted might help you. They aren't addressing Europe's historical unemployment rate.

Quote :

"As a result, they have mixed up cause and effect: the differential could not have been caused by the European Central Bank, since the ECB did not exist for much of the time of the differential."

No, they haven't. They aren't talking about what you're talking about. It's entirely possible the ECB policy did increase unemployment in recent years.

Quote :

"What we should expect to see is a lower GDP per capita if I am right that regulations and unions curtail productivity, which we have (France's GDP per capita is roughly 73% that of the United States)."

But Norway's is higher than ours and Ireland's is nearly equal. Both have higher levels of employment protection than we do (Norway much more than Ireland). Norway has a significantly stronger union presence. I'm not sure about Ireland, but I think it's slightly stronger.

Note also that while France has less overall, it's more evenly distributed. Because of this, average folks probably do at least as well over there. Personally, I'd be quite willing to sacrifice overall wealth for increased equality.

Finally, I should note the futility of what we're doing. So many factor determine the performance of any individual economy that these comparisons aren't to be trusted. We can't perform a laboratory experiment here. That's one of that many things that separates economics from the hard sciences.

Quote :

"I accept the deductive power of reason while you reject it in favor of belief."

Ha. As a devoted follower of the dismal pseudoscience, you're not one to talk.

[Edited on September 9, 2008 at 11:58 PM. Reason : typos]

9/9/2008 11:56:44 PM

Quote :

"No, they haven't. They aren't talking about what you're talking about. It's entirely possible the ECB policy did increase unemployment in recent years."

Are you trying to be dense? Arguing that the current unemployment differential was created by a current event just begs the question as to why the previous unemployment differential was even larger than the current one!

Quote :

"But Norway's is higher than ours and Ireland's is nearly equal. Both have higher levels of employment protection than we do (Norway much more than Ireland). Norway has a significantly stronger union presence. I'm not sure about Ireland, but I think it's slightly stronger."

I suspect the owners of Exxon have a higher per-capita income than Americans in general. The same goes for Norway; a large chunk of Norway's GDP flows from the ground, it did not require careful allocation of land, labor, and capital to achieve it. In a real sense, when calculating productivity I think oil income should be discounted. This would reduce America's GDP by about 1.2%. However, such an adjustment would be devastating for Norway, reducing GDP by 33% (all of which was being produced by less than 1% of Norway's workforce).

As for Ireland, you should do the research. Ireland is ranked as 3rd in the Index of Economic Freedom and enjoys labor markets significantly freer than its peers in Europe (Ireland 80.4, France 63.8, Germany 52.8). More importantly, Ireland enjoys similar regulations than that enemy of the people, the United States, which ranked 5th on the list. When describing Ireland, the report states: "Flexible employment regulations enhance employment opportunities and productivity growth. The non-salary cost of employing a worker is low, and dismissing a redundant employee is relatively costless."
http://www.heritage.org/research/features/index/countries.cfm

Now, more than one such index exists. Sometimes America is ranked just above Ireland, sometimes the other-way around. But no one would ever mistake France, Germany, or Italy for being less regulated than Ireland (15% flat corporate tax rate rocks!).

9/10/2008 12:41:49 AM