Wednesday, August 15, 2012

In Order To Form A More Perfect Union...

The phrase, “In order to form a more perfect union”, in our constitution has taken on new meaning in our president’s pursuits. Most of what he does is to curry favor with unions, like repaying the auto workers unions by protecting their pensions with the auto company bailouts and giving them profit from GM and Chrysler, while putting investors last and telling the non-union employees from the subsidiaries to go pound sand, that there was no help for them. Did it occur to anyone on the left that the worker pensions were killing the companies? No, I guess there were more potential votes among the auto workers past and present than there were among investors. Then there is the practice of closing GM and Chrysler dealerships, who’s owners had not been friendly to the Democrats with donations, or dumping billions of newly printed dollars into green companies, like Solindra, who had made sizable donations to the green-loving Obama administration knowing that they would be their “bank”. Is everyone aware that Obama’s politically correct choices for investing stimulus money (Obama Bucks) have all resulted in bankruptcy, lost jobs, outsourcing of jobs, and huge bonuses for the company bigwigs? Is Romney’s business background and remarkable record of success at Bain Capital looking more appealing to anyone. This is called “Crony Capitalism”. Few people realize that the Wall Street investors donated more to the Obama campaign than to McCain for the 2008 election. They apparently got their money’s worth. One of the biggest contributors was General Electric, who, last I heard because of loopholes created by green energy policy, did not pay any corporate taxes. I wonder if Harry Reid could look into that. Green businesses just keep on costing us money and don’t produce anything. Oh yes, and is everyone aware that GM has yet to pay back all of the bailout money. That means that all of the American taxpayers are helping to buy the Chevy Volts that so few people are stampeding to buy. I think I should get to drive one once in awhile, since I am part owner.

The Democrat party has long depended on union support to stay in power, and the unions have long depended on the Democrat party to legislate in their favor. Take for example the card check laws that unions and the Democrat party want to implement. This would do away with secret ballots for employees who choose not vote for a union in their place of work. Why would someone not want to belong to a union? Perhaps they would feel as I do that they would not want their union dues handed over to a political party or candidate whom I disagree with. Or, they may not like the idea that the pyramid scheme protects the union bosses and the earliest  to join in over the rest of the rank and file members. Or they may not like the cosey relationship between labor bosses and Democrat party bosses--SEIU bosses brag that they have been to w the White House more often than any other entities. Does this seem democratic to anyone who is not a blithering socialist? This practice of scratching each other’s backs between unions and the Democrat party would also be considered crony capitalism to a logical mind. Why, you might ask, would it be a good idea for government employees to unionize and bargain with government for wages and pension plans? Well, it’s a good idea from the unions’ and the Democrat party’s perspective. If you can pay off the public worker unions for their continued support, you can amass more and more power and stay in affectively stay in power. The process of growing government larger and larger to create more dependency and a bigger voting block to draw on is identical to that of growing the welfare state and creating dependency. “The Republicans are going to cut your welfare!” Has anybody else noticed that the states which are struggling the most tend not to be right-to-work states? The also tend to be states with Republican Governors and republican control of their legislative bodies.

Of course, the unions and Democrats would want everyone to be in a union. In essence, this is what the minimum wage is all about. The reality of the minimum wage is that it only creates inflation and pushes, in theory, people towards unions. When the minimum wage goes up, the unions cry that their wages needs to go up to keep them relative to where they were before the minimum wage went up. Higher wages necessarily increases the cost of everything, which makes all goods and services go up. If profit margins suffer because entry level wages are higher, the business man must naturally cut back on employees or raise the price of his goods or services. The same is true about higher taxes. If taxes cut into profit margins, the business has to raise prices. Higher prices for goods and services naturally make the workers clamor for higher wages. The unemployment level for youth (18%), especially black youth (46%), is horrible. Thank you, minimum wage and the Democrat party. Then there is the protection that unions often provide for those workers are inadequate in the jobs they have. Almost everyone is aware of how difficult it is for some companies and institutions to fire the shiftless and undeserving workers. It used to be that meritocracy was the rule for those who wanted to climb the ladder to success. It would seem that the Democrat party is afraid of that idea. It might actually lose them a voting block, if more people had to work hard to protect their income stream.

Liberals seem to believe that the tax payer can be manipulated to fund everything eternally. As cities, counties and states begin to bankrupt themselves, because they thought the taxpayer gravy train would never dry up, they look to the federal government for bailouts. It seldom occurs to the union leaders that unrealistic union pensions are the major culprits for government failure. Just as in the private sector, public service unions want the moon if they van get it. But, private sector unions are not able to lean on companies and vote for their own pay increases, while the public service unions can. Companies often try to weigh their choices based on the dollars and cents returns on their investments in labor when they bargain with organized labor. If they choose badly, they run the risk of putting themselves out of business and the workers run the risk of bargaining themselves out of jobs. Governments who bargain with a labor force tend to not worry so much about the costs, because they will likely be out of office and they can always raise taxes, at least they think that if they are liberals. In fact, they think they have a better chance of staying office if they can grow the size of their government and promise more and more stuff to the government employees to keep them voting for those controlling the money faucet. However, when the money pond runs dry, the local governments turn to the feds. Businesses, unless they are deemed too big to fail, cannot do this.

Theoretically, the federal government, unlike the local governments, can just print more money to help them pay off their debts. However, we are now in new territory. Our national debts and deficits have never been bigger and the plan to spend more money has never been bigger. The problem is clear to some of us: We spend more than we produce, so we must have self-destructive tendencies, or we are just plain stupid. Even the feds cannot print money enough without creating huge inflation—that worked really well for the Carter administration—and they cannot raise taxes on the 53% of the public who actually pay income tax without killing the economy even deader than it already is. Ten out of ten people with any brains agree that we have to cut expenses to survive. This is the reality that “working” people deal with every day. If you live beyond your means, you will eventually go bankrupt. Still, the Democrats want to continue with huge deficits and think that raising taxes on everyone making $250,000 a year will save us.

Here is a bit of news: Raising taxes on the few rich does not and never has equated to increased revenues. I know President Obama lives in a world where history means nothing, that he believes that free markets and low taxes have never worked, but he is counting on the ignorant masses largely living in that same history-free world, to keep his dreams of a socialist utopia alive. In the real world where history is studied, we know that lower taxes and fewer constraints on the free market actually increase revenue—every time it’s tried. You can look to Calvin Coolidge, John Kennedy, Ronald Reagan and George W. Bush for good examples of this. Yes, I know, George W. Bush also saw the big economy crisis of 2008, caused by the housing mortgage bubble, but you must remember that Pelosi, Reid, Frank and Dodd ran interference to protect their cronies at Freddie Mac and Fannie Mae from stricter federal oversight, which led to the crisis—I still believe Frank and Dodd should have been brought up on charges along with their buddies at those institutions. Funny that the Democrats wanted someone to go to jail over that stuff, but as the culprits, have come to light and their party affiliations and political donations have been realized, the clamor for justice has been silenced.

But let us get back to unions. In our nation’s past, unions served a purpose—some times, it had nothing to do with racism and keeping undesirables from competing with established whites for labor in the market place . Unions were helpful in creating safer conditions in the work place and afforded protection for children in the work place, but for the last century they have caused more harm than good, enhancing corruption in politics and, in some cases, embracing organized crime. The need for private sector unions has run its course, in my opinion. There are plenty of laws on the books, both federal and state, to protect worker rights, and the market place will naturally determine what wages and pensions should be, just as the mark place will determine what prices need to be, as the scarcity of workers and resources naturally dictate. There has never been a need for public sector unions. In fact, as I have argued, their existence has been destructive to our economic balance. Even F.D.R. warned against public sector unions. Wisconsin—no surprise here, perhaps—was the first state (1959) to agree to collective bargaining for government employees. Since then the idea has spread and helped destroy economies in liberal states like Illinois and California. These states are essentially bankrupt and their progressive politics threaten to drown us all in debt. The only real answer is to let them go bankrupt. Let them fail. The truth is there is nothing to big to fail. As I said, if we all joined a union, the Democrats would be perfectly happy, but our union would not be the more perfect union described by Madison. It would be more like the Soviet Union. The Soviet Union was not too big to fail.

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