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Unfortunately, historical patterns seem to suggest that when the economic conditions take a down turn, people collectively tend to do really stupid things and make it far worse. I'm hopeful that the new Gutenberg Press-effect of the internet can function as a powerful information distribution mechanism, and people learn enough from the long-cycle past, reviving memories of the generations that just passed, and prevent the same historical tragedies all over again. It is indeed an issue of life and death for millions of people (if not billions). That's why I have been quite emphatic about sharing the historical lessons that none of us living today has experienced first-hand. Historically, it is that passing of the previous generations that allowed the living to engage in the same mistakes that the recently passed engaged in when they were young.
Labor union movement did not make much head way during the 1870's and 1880's economic boom (steel making for railroad). Railroad building of course had tremendous economic value, but eventually turned into a bubble due to all sorts of government subsidies to big railroad companies. When that bubble burst, the labor union movement grew significantly in the 1890's. Workers who wouldn't cared for joining the union when high-paying steel making jobs were plenty became quite receptive about how the new-fangled European idea of labor unions would help members preserve pay and jobs. Eventually that combination of unions and big steel companies (and their bankers) did find a replacement demand for cancelled rail track orders: building steel battleships. That battleship race eventually led to WWI, where plenty union members and non-union workers were marched off to be slaughtered.
After about 37.5 million recorded casualties (WWI alone), and multiple times that among old people dying pre-maturely so their pension obligations were wiped out, the world economy entered a boom in the 1920's thanks to the popularization of automobile. Unions and fascist collective price setting committees still played a big role in the devastated post-WWI Europe, so their car making industry did not get very far. America took the leadership in car making. For a time, Ford alone made more cars than all the rest of the world's carmakers combined, then GM overtook Ford within a few years. Workers in the automobile industry did not find much need for unions in the 1920's America. Then the Florida land speculation bubble burst followed by the stock market crash, revealing that the final years of the 1920's boom was due to reckless FED monetary expansion far beyond what the legally required gold backing could support. Union became fashionable when workers feared losing their jobs and having their wages cut . . . just as President Hoover worked hard to force businesses to protect bubble-year price and wage levels; i.e. preventing the market to clear and reset. Trade tariffs were raised to help "protect" prices; i.e. further retard free market economic exchange . . . . Then FDR won the next election on the promise of dismantling Hoover's government committees, but only to expand them geometrically after taking office. The real economy continued to collapse despite a dollar default/revaluation making various indices look better (as the unit of count was shrunk so the numbers looked bigger) . . . Eventually Bastiat's admonition "where goods do not cross borders armies do" came to fruition, leading to 60-80 million deaths in WWII.
I'm cautious optimistic about what's happening now, with internet enabling people access to lessons from previous generations, unlike the radio technology in the 1930's giving the governments power to tell the peons whatever the dictators wanted to propagate. OTOH, although Formal Labor Unionism is not picking up steam yet, a bastardized form, what I call "union membership by place of birth," i.e. trade protectionism, is rearing its ugly head even among the educated white-collar workers as their jobs are threatened by less expensive alternatives. Most people don't realize that having bureaucratic enforcers to enforce "protection" would be even more costly to their own standards of living than finding alternative jobs and enjoy the fruits of labor of those doing what they used to do. Somehow in the human mind "protection" is always assumed to be free when the use of violence (and the threat thereof) is usually the most expensive thing there ever is.
posted by 24.91.39...
, Tue, 5 Jul 2011 14:58:44, Thu, 7 Jul 2011 08:20:29
, Thu, 7 Jul 2011 07:00:33, Wed, 6 Jul 2011 17:08:22, Tue, 5 Jul 2011 10:10:14, Tue, 5 Jul 2011 10:46:16
, Wed, 6 Jul 2011 06:45:49
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