labor strike labor land capital
|January 9, 2007||Posted by Fred Foldvary under Progress Report, The Progress Report|
by Fred E. Foldvary, Senior Editor
The workers of the Bay Area Rapid Transit (BART) system of the San Francisco Bay Area are on strike. Today, Monday, the 275,000 commuters who use BART will find their workday disrupted. Cars will jam the Bay Bridge. As with the UPS strike, the cost to society far exceeds any benefits either side hopes to achieve.
I am one of those who will be affected. I need to go to San Francisco today to teach a class, and I will be driving instead of taking BART. I worry – how long will it take to cross the bridge? Will there be parking? How long will it take? I am angry that my life has been jolted like this.
From a social point of view, a strike is economic insanity. Workers lose wages, the business loses revenue, and the public loses most of all. Why does it happen? Why is there this eternal conflict between labor and management?
From the workers’ point of view, the strike is quite rational. Many don’t have a realistic work alternative other than their employer. Without a union, the workers are in a poor bargaining position, since they fear unemployment. With a union, the workers are in a strong position. Their weapon is the strike, and it is a useless weapon unless they show they can use it.
But why, why is the ordinary worker in this weak position in the first place? It seems natural that this should be so, but it is not nature but government intervention that makes it so. All wealth comes from only two sources: land and labor. By nature, labor should be in a strong position, since all goods are made by labor. But labor needs the resources of land, and if they don’t have access, then he who controls the land controls labor.
Labor’s natural power comes from having opportunity, the natural opportunity to use resources, and the opportunity to seek other employment. The boss can’t exploit the worker if the worker can easily jump over to another job or become self-employed.
But government policy has taken away this opportunity. The benefits of the land, the rent, go to the owners, not to the people. The wages of labor then get taxed to fund government, and those who want to become self-employed have to get permits, pay high taxes, and follow a million regulations for which they have to hire lawyers and accountants. These barriers block alternative opportunities.
So the ultimate remedy for strikes is to solve the problem at its roots. Take down those barriers! Taxes that take half your earnings, excessive regulations that cost the average family $6,800 per year — get rid of these and provide equal rights to land by making the holders pay a rent that would fund government instead of taxes. Do this, and we put labor in the catbird seat. Do this, and labor has so much opportunity that they won’t need or want to strike. If instead we keep those barriers, then brace yourself for more strikes, because now that good times are here, the workers are going to want their share.
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Copyright 1997 by Fred E. Foldvary. All rights reserved. No part of this material may be reproduced or transmitted in any form or by any means, electronic or mechanical, which includes but is not limited to facsimile transmission, photocopying, recording, rekeying, or using any information storage or retrieveal system, without giving full credit to Fred Foldvary and The Progress Report.