And anytime your feel the pain, hey Jude, refrain
Don't carry the world upon your shoulders
--The Beatles
What happens if growing government intervention causes entrepreneurs and capitalists to exit the economic system in search of better opportunities? That is a central question in Ayn Rand's classic work Atlas Shrugged.
This is no hypothetical question, of course. Rand saw it in motion over 50 years ago. Government intervention that stifles free enterprise has been a significant factor in the decline of domestic manufacturing. Why would a producer want to cope with myriad governmental obstacles when it is easier to set up shop elsewhere?
Case in point is this situation in South Carolina. The National Labor Relations Board (NLRB), an agency of the federal government, is suing The Boeing Company (BA) for building a commerical aircraft factory in Charleston. The new facility will not be unionized.
The NLRB claims that BA is retaliating against the International Association of Machinists and Aerospace Workers (IAMAW) union for past strikes in Washington state. The NLRB is seeking a court order forcing BA to build the new factory (although the SC facility is nearly complete and will open this summer) back in Everett, WA--the historical (and unionized) home of BA's commerical airplane business.
The argument is so frivolous that it is difficult for me to type this wearing a straight face. But the fact that the issue is even on the table demonstrates how far we have strayed from the liberal (classically defined) principles of property rights and freedom of association.
In a free society, property owners decide how their assets are deployed. They are also free to associate with whomever they want to work in that regard. Good choices are rewarded on the free market, while bad decisions are penalized.
Whether BA is 'retaliating' against a union's past behavior makes no difference. The owners of BA should be free to associate with whomever they please. If they choose poorly, then the market will penalize them accordingly.
If government continues to intervene in this situation on behalf of special interest groups such as organized labor, then it provides additional recruiting fodder for John Galt.
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Consequently, at best, a union can achieve a higher, restrictionist wage rate for its members only at the expense of lowering the wage rates of all other workers in the economy. Production efforts in the economy are also distorted. But, in addition, the wider the scope of union activity and restrictionism in the economy, the more difficult it will be for workers to shift their locations and occupations to find nonunionized havens in which to work. And more and more the tendency will be for the displaced workers to remain permanently or quasi-permanently unemployed, eager to work but unable to find nonrestricted opportunities for employment. The greater the scope of unionism, the more a permanent mass of unemployment will tend to develop.
~Murray Rothbard
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