Keith,
I doubt this guy has ever stopped to consider how much wealth the
factory owners/landlords accumulate in their slave-dependant pursuits,
above what is reinvested, but I'm most certain he knows just how large
the gap between owner and worker really is. Yet he doesn't suggest for a
nanosecond that the owners give up any portion of profit. Nor does he
dare to honestly look at the typical workers vs. supervisor vs. middle
management up to CEO pay structures. Anyone who hires work slaves is
hardly in it for the good of the unemployed people.
Nations raising generation after generation of slaves cannot possibly
thrive. Add to that criminal governments that ensure oppression, at all
levels, and poor public education. That's no way forward.
More of Reisman's twisted economist/capitalist ideas can be accessed by
"economically priced" courses though this link:
http://www.capitalism.net/Capitalism/Economics%20and%20Capitalism.htm
*Natalia*
<http://www.capitalism.net/Capitalism/Economics%20and%20Capitalism.htm>
On 27/05/2013 3:08 AM, Keith Hudson wrote:
*A Deadlier Disaster for the Third World: Unemployment**
*/George Reisman
/The recent collapse of a garment factory building in Bangladesh,
resulting in the death, at latest count, of more than 1,100 workers
who were employed there, has led to international outrage not only
against the building's owner but also against the various retailers in
the United States and Europe, many of them prominent, that have sold
clothing produced in that building. It is demanded that they assume
responsibility for working conditions in the factories that supply
them and not deal with factories that do not provide safe and humane
conditions and pay fair wages.
Such demands rest on the belief that, if left free of government
interference, the profit motive of businessmen or capitalists leads
them to pay subsistence wages to workers compelled to work intolerable
hours in sub-human conditions. And, more, that the profits wrung from
the workers in this way exist in the hands of the capitalists as a
kind of disposable slush fund as it were, at least some more or less
substantial portion of which can be given back to the workers from
whom they were taken, or used on behalf of those workers, with no
negative effect except to deprive the capitalists of some of their
ill-gotten gains. It is generally taken for granted that the reason
the kind of conditions that prevail in Bangladesh and the rest of the
Third World do not exist in the United States and Western Europe is
the enactment of labor and social legislation, and that what is needed
is to extend such legislation to the countries that do not yet have it.
Every aspect of this set of beliefs is wrong and its consequences are
highly destructive, above all to the masses of workers in the Third
World who already live close to starvation and who are in danger of
being driven into it by needlessly increasing the cost of employing
them either by arbitrarily raising their wages or by requiring that
they be provided with improved working conditions that must be at
their expense and which they cannot afford.
One of the most elementary propositions of the science of economics is
that the higher the price of anything, the smaller is the quantity of
it that will be purchased. This applies to labor no less than to
goods. If wage rates in Bangladesh are arbitrarily increased, fewer
workers will be employed in Bangladesh. In that case, workers who
would have earned low wages will earn /no/ wages. They will starve. If
employers in Bangladesh are compelled to make improvements in working
conditions of a kind that do not pay for themselves, the cost of those
improvements represents the equivalent of a rise in wage rates. Again,
there will be unemployment. The unemployment could be avoided only if
workers' take-home wages could fall sufficiently to offset the cost of
the improvements. In that case, the situation would be comparable to
making the workers use their already meager wages to pay for
improvements that they simply cannot afford.
These are not outcomes that the advocates of imposing labor standards
want. What they want is higher wages and better working conditions.
Their problem is that they do not realize what is actually necessary
to achieve these results.
What will achieve these results is leaving business firms in
Bangladesh and throughout the Third World alone, to be as profitable
as they can be. (It should be obvious that the loss of a factory
building and its machinery was /not/ profitable and that while it may
be legitimate to denounce the building's owner for criminal
recklessness and negligence, it is simply absurd to denounce him for
seeking profit, when what he actually achieved, and could only achieve
through such conduct, was total /loss/.)
The high profits that can be earned in a Third World country, if not
prevented by too many obstacles, will be heavily saved and invested,
mainly in that Third World country. As the experience of Taiwan, South
Korea, and now even mainland China shows, a generation or more of such
a process results in a vast accumulation of means of production in the
countryi.e., numerous new factories, with better and better
equipment. This results in an intensified competition for labor and
thus rising wage rates. As wage rates rise, workers can more and more
afford to accept lesser increases along with improved working
conditions of a kind that must be at their expense.
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