Since Biden seems to like unions and the resultant inflation, will he join this picket line as he did with the UAW?
Largest U.S. Healthcare Walkout on Record
Wages and a staffing fight are behind the Kaiser Permanente Union Workers Strike, Mounting Largest U.S. Healthcare Walkout on Record.
More than 75,000 nurses, pharmacists and other employees of the Kaiser Permanente health system walked off the job Wednesday in the largest U.S. healthcare strike in recent history.
The workers struck after contracts expired and their unions couldn’t reach an agreement with Kaiser on how much a new deal would increase wages and staffing.
The work stoppage involves Kaiser workers in five states and Washington, D.C., including workers who care for patients, such as pharmacists and respiratory therapists, and other staffers, such as laboratory technicians and kitchen and janitorial employees.
In the contract talks, Kaiser said, it has proposed wage increases of 12.5% to 16% in total over four years, depending on the location.
Unions said the employer’s offer doesn’t go far enough to offset inflation. They are seeking a total wage increase of 24.5%.
It’s Only Fair
It’s not fair for Biden to join the UAW picket line and not the Kaiser Permanente picket line. He should join all of them.
What’s with this blatant favoritism anyway? And why stop at 24 percent? The UAW wants 40 percent.
For discussion, please see UAW Strike Has the Big 3 Automakers Scrambling for Parts
Progressive Dream Team
The tag team of Biden and California Governor Gavin Newsom is a Progressive dream come true.
More inflation is coming your way. Gavin Newsom leads the way, upping the minimum wage for fast food workers in California to $20 per hour.
“This is a big deal,” Newsom said.
A Big Deal Indeed, Expect More Inflation
Yes, governor, this is very big deal. It will increase the cost of eating out everywhere.
The bill Newsom signed only applies to restaurants that have at least 60 locations nationwide — with an exception for restaurants that make and sell their own bread, like Panera Bread (what’s that exception all about?)
Nonetheless, the bill will force many small restaurants out of business or they will pony up too.
30 Percent Raise Coming Up!
If McDonalds pays $20, why take $15.50 elsewhere?
The $4.50 hike from $15.50 to $20 is a massive 30 percent jump.
Expect prices at all restaurant to rise. Then think ahead. This extra money is certain to increase demands for all goods and services, so guess what.
For discussion, please see Minimum Wage for Fast Food Workers Jumps 30% to $20 Per Hour in California
$40 is the New $15
Does anyone remember the fight for $15 an hour?
That’s so passee. We went straight from $15 to $20 and $40 is the next stop.
Why stop there?
Does the UAW United Auto Workers Union Merit a Huge Raise?
Given productivity is in the gutter, I am wondering Does the UAW United Auto Workers Union Merit a Huge Raise?
It was untenable wage and benefit contracts that led GM and Chrysler to bankruptcy once already.
Small Business Bankruptcies Surge in 2023, Five Reasons Why
Surge in Wages
Minimum wages have surged. Unions are piling on. Small businesses have to offer prevailing wages or they cannot get workers. But they cannot afford to pay $20 an hour. So it’s bankruptcy one way or another.
On October 1, I commented Small Business Bankruptcies Surge in 2023, Five Reasons Why
Small business bankruptcies will fall hard on the regional banks.
But hey, Biden tells us inflation is under control as he joined the UAW picket line essentially begging for more inflation.
Obviously all these workers should be earning 200k, just like doctors with 10-year intercalated degrees… that’s equity… it’s what makes Venezuela and Zimbabwe such tropical paradises. Looking forward to some Ergodan-sinpired Turkish delight.
As I understand things, different than Mish does…
Re. the Kaiser strike, consider it a foretaste of Sen. Bernie’s Medicare for all. It looks very much like what Canada’s Medicare, or Britain’s NHS suffers frequently, and what we see in public schools. The workers organize. The administration of hospitals and clinics gets bloated. Money going there goes up, by all appearances greater than would go in a free market. (That is Joe Biden’s intention, that workers get paid>= than they are worth.) At some point those costs hit a ceiling of what the public and the government is willing to pay. Then service quality declines. Any number of health advocates argue that deficiencies in care can be fixed by government spending more on the NHS, and government can get the money by making the “rich pay their fair share.” But government has already maxed out its ability to pay.
– Among the lessons for the customer is that they darn-well better take good care of their own health and safety, because they can’t afford the “free care” that the NHS provides.
Re. Fast Food, I see two directions this could go. The “just” way to go would be an end to McDonalds etc. in California. All those locations turn into Joe’s Hamburgers, Jim’s Hamburgers, Hootie’s Hamburgers, etc. not subject to the Council and its dictates.
The other way sees all those chains like McDonalds lobby to have the law and authority of the Fast Food Council extended to all restaurants. As Mish remarks the higher costs will result in higher prices. Higher income locales are expected to pay those prices, (a good thing.) and will cut back their spending on other things Then there are some neighborhoods like Watts whose residents can’t afford those prices. People will instead brown bag their lunches like the old days, or patronize convenience stores and food trucks. To be seen what California and the SEIU then do. Affairs could look like what I once read of Mexico. Legal businesses there are subject to such government regulation and organized labor, with costs and prices higher than many people can afford, and the barrio has more people seeking work than there are jobs. As Keynes described. So countries like Mexico get large informal sectors of people and businesses working in violation of the law. I read an article in 1993 that this already occurs in Los Angeles.
the cash economy and undergound companies in places like LA and Phoenix……….are huge. lived there for a dozen years. it’s quite nice actually. so much more entrepeneurial with small business women and men knocking on doors to sell you tree trimming pool cleaning, tamales delivered to door…..from their autos……………..plus much more. some local analysis of thinkers it’s really quite huge. some rich countries have huge underground economies. italy has probably about 1/3 of GDP under the table. for centuries. a good thing, in my book. i love cash economies. here in ethnic brooklyn, half the stores and restaurants have huge cash discounts………
Your discussion on wage increases resulting in inflation is back to front – wage demands result from inflation. These demands are a symptom, not a cause.
Further, a company gets the union it deserves: abuse your slaves and they’ll eventually revolt.
Finally, a business model whose success is based on holding down wages is headed for failure.
It’s simply free enterprise responding to the signals. I’m with MPO on this.
correcto mundo
The union at Kaiser wants a minimum of $25/hr, but most make way more than that. Pharmacists already make a ton of money. At the end of the day a 24% increase will just get passed to the customers. Those who support this wants to pay higher health care costs. Kaiser just came off of another Union strike not long ago. There’s already been 2 previous strikes this year.
Costs have been pushing higher regardless of wages increases. These companies have monopoly power and do not care.
If companies can form cartels, then workers can aggregate and fight with what they have.
This free market bs and wages driven inflation is pure conservative bs to justify maximum concentration of profits in a few hands.
Reactionary twaddle from Mike Mish. Barely 6% of private employees are organized, while 40%+ can’t afford a $400 emergency expense. Meanwhile the top 10% gather to their bosoms all the gains of the last two decades of bailouts, tax cuts, and bi-partisan corruption. Blame the workers!!!
What planet DO you live on?
the anti union rants seem silly when unions are so tiny. now if we are talking about gov unions that’s a different story. those have busted school police fire and state and other munis and screwed the taxpayers not on gov unions teats. FDR knew gov unions was dumb. and evil.
Rolling the 1973 tape…
Ehrlichman explains the Kaiser business model to Nixon:
“All the incentives are toward less medical care, because…
the less care they give them, the more money they make.”
Capitalism. One pie. Workers want a bigger slice.
Inflation is the Ill-defined economic bogeyman. There is no such thing as the “wage-price spiral”; the “price-wage spiral”; or the “cost-push spiral”; in the sense that increases in wages, prices, or costs are causes of inflation.
Unless effective demands (money times transactions’ velocity) are adequate to prevent a cutback in sales, or a diversion of purchasing power to the price raisers, any administered increase in prices will result in less sales, smaller outputs, less employment, lower payrolls and less demand for products—in other words, depression and deflation in due course.
Exactly. There is no such thing as positive feedback.
Oh. Wait…
My understanding is that kaiser permanente is pretty darn awful to work for. Overworked and underpaid by a lot.
That would indicate the union that represents them isn’t successful at bargaining for wages and working conditions? Are you sure?
As DR. Ravi Batra pointed out in his book: “Greenspan’s Fraud”:
“If demand and supply are to be balanced over time, then either wages rise in sync with productivity, or productivity growth must be matched by the growth of wages plus debt…so debt growth was the only way to maintain demand-supply equilibrium from the 1970s till today.”
The most critical fallacy of current economics is “maintain demand-supply equilibrium.” These are dynamic systems that may constantly attempt to seek an equilibrium. But they never, ever maintain equilibrium. “dynamic stochastic general equilibrium” == BS.
You can escape the pharma and the healthcare mafia by following on Utube & books :
1) Dr Nathan Bryant : Nitric Oxide.
2) Dr Robert Lustig : Metabolic Health.
3) Eillen Kopsaftis : stretching, flexibility and incontinent.
So, it is capitalist for Healthcare companies to gauge rates at double digits per year, but heaven forbid any of that is passed to employees … because that is socialist.
Most of the health care cost increases comes from better medicines, highly paid specialist doctors and malpractice insurance. Other than reforming malpractice, the other two result in better clinical outcomes. We’re getting better outcomes. That said, there is a nursing shortage which would normally drive up wages by itself.
Better medicines is questionable. VERY often when patents run out companies just issue V2 (version 2) of the same med so they can get another 7+ year monopoly and extract very high prices from US consumers (we know this because those same meds often cost 1/10 of that price in Canada).
In reality medicine cost is one of the biggest areas where consumers could be winners if the market was opened up (see Mark Cubans latest venture) and monopolistic pricing was removed.
Not sure about better outcomes. Quality of life is not always great after interventions.
Have you been drinking? Healthcare providers are the closest thing we have here to a mafia racket. Kaiser is an egregious example of abuse. What free market capitalism? Workers and government have the right to break monopolies that pretend to play free market capitalism.
American healthcare is not entirely free market, nor exactly a beacon of it. Look at how many hospital systems receive federal and state handouts (just see the pandemic for a recent example). Look at the big drivers of “revenue” and who constantly props up R&D. It’s Medicaid, Medicare, and government grants.
PPACA has driven small practices into the arms of corporate healthcare systems and a good chunk of practitioners have moved into concierge care because they don’t want to deal with the administrative burden that insurance companies have become.
Health insurance as a benefit wasn’t a thing until FDR instituted wage controls and it became further distorted during the 70s with HMO.
Screaming that American healthcare is free enterprise is essentially the same argument that people make when they think the federal government propping up of the student loan business has no effect on tuition prices. You can’t guarantee loans for all and expect the average student not to become a debt slave.
I will politely disagree with Mish on a handful of things, but he’s not wrong on this.
Biden is controlled by anti-capitalists(Marxists). If it helps their agenda to destroy capitalism, he will be there.
For 40 years workers have lost in inflation adjusted dollars or at best certain categories of earners maybe gained marginally and you know this and over the years I’ve followed your blog have posted graphs showing that multiple times. But, yes let’s blame those greedy workers.
Since you have followed me so well, please tell me who I blame for inflation instead of bitching mindlessly.
While true the workers have lost ground, government imposing arbitrary pricing will worsen the situation. We’re not blaming workers for wanting more, nor blaming businesses for wanting to pay less. That’s normal economic negotiation. Whom to blame for the growing gap between wages and productivity? Probably that productivity gains over the past decades have come from chips and software rather than from workers becoming more productive. Hence the gains in tech wages and the sluggish manufacturing wages. Raising wages from market demand is great. Raising wages by government fiat will only create layoffs and accelerated the shifts towards robots and AI.
Minimum wages have surged. Unions are piling on. Small businesses have to offer prevailing wages or they cannot get workers. But they cannot afford to pay $20 an hour. So it’s bankruptcy one way or another.
Isn’t this exactly what the free market is for? What entitles small businesses to cheap labor? What small businesses need to do is rethink their business models or they should file for bankruptcy.
Food costs at restaurants has been rising for decades, it didn’t just happen with California raising wages to $20.
And let’s not forget that 50 million boomers are leaving the workforce and collecting free money from social security and subsidized medicare which increases demand, seems this is never discussed when posting complaints about wages. Social program entitlements are the biggest government spend which means it’s one of the biggest drivers of demand.
The real problem isn’t unions or states raises minimum wages, it’s a central bank system that devalues the currency which forces everyone to demand higher wages just to stay even.
Small businesses should be free to pay what they want. Unfortunately they are not because of the minimum wage law. Otherwise I imagine they would not pay $20/hr for fast food workers but would likely instead pay $10 or less to students living at home as they did when I grew up.
“Small businesses should be free to pay what they want.”
In wages.
But also in rent. Meaning: They should be free to build whatever they need/want themselves, if they can do so cheaper than prevailing rents.
Unfortunately they are not because of the same totalitarian theft racket imposed laws which makes $15/hr not a ‘living wage” anymore.
Otherwise I imagine they would not pay $20/hr for fast food workers but would likely instead pay $10 or less to students living at home as they did when I grew up.
And, they would hire some dude outside Home Depot to slap up space, for a lot less than they are currently forced to pay some net-negative nobody sitting on his couch, in rent.
Ditto, insurance: They should get the insurance they want. No mandates. They shouldn’t be forced to go play courtroom drama with any ambulance chaser they did not want to play silly games with. They shouldn’t be any more banned from hiring doctors and nurses from abroad, than farm labor . Etc., etc.
Problem with totalitarian government is: Once it becomes clear that government redistribution is the sole and only path to wealth, everyone will simply stop what they are doing, and focus on getting themselves in on the redistribution rackets as well. And there’s nothing somehow “more wrong” about minimum wage laws, than about zoning laws and other building restrictions. Ditto insurance mandates. “Civil court” shakedowns over anything other than disagreements over the interpretation of explicitly entered into, voluntary contracts. Immigration restrictions. etc. All is just the same old totalitarian overreach. None any better nor worse at all, than any of the others.
Isn’t this exactly what the free market is for?
MPO45v2 are you really that stupid?
Since when does government interference and meddling into unions, mandating collective bargaining constitute a free market?
No I’m not stupid. You clearly love to name call but get bent out of shape when people here do the same to you. What a hoot!
The government “interference” has existed for a long long time, it is part of the market and has been since the inception of this country. Minimum wage laws have existed for the past hundred years and will continue to change and likely up. The fact that dimwitted businesses don’t understand that or can’t change and evolve their business model is their own problem.
I honestly don’t know what fantasy world you live in but it doesn’t exist nor will it ever exist and whining about it endlessly won’t change a single thing. How many years have you run this blog and has it changed anything? I’m happy for you if it brings in ad revenue and keeps a few dollars flowing but at this point and at your age you really need to start asking what kind of legacy you are leaving because it may all be over soon enough.
Take care.
“The government “interference” has existed for a long long time, it is part of the market and has been since the inception of this country. Minimum wage laws have existed for the past hundred years and will continue to change and likely up.” – Unfortunately for workers, government has interfered. Regardless it is not “part of the market” but an artificial force outside of the market.
“The fact that dimwitted businesses don’t understand that or can’t change and evolve their business model is their own problem.” – The dimwitted business are indeed changing their models. As elected officials shameless pimp for votes by calling for artificially set wages, the businesses are moving towards robots and technology of all sorts to get higher productivity from limited resources. Pre-ordering kiosks at McDonalds, welding robots at GM, robotic surgery in hospitals, manufactured housing, automated voice response systems, driverless trucking, etc… Every wage that increases makes tech investment just a little more attractive. But, yes, go ahead and try to stop the economy from becoming more productive. Good luck to you.
If businesses are changing their models with robots THEN THEY DONT NEED TO WORRY ABOUT MINIMUM WAGE! The problem fixes itself but in the meantime people need to eat.
Go ahead an automate and robotize 100% of the economy then tell me what you expect humans to do.
And by the way, republicans are introducing a bill to wage federal minimum wage to $11.
link to constructiondive.com
You sound like the champion of minimum wage workers. Free market means no govt interference. A higher minimum wage does not equate to a livable wage. Minimum wage jobs were never meant to offer livable wages. Minimum wage jobs were traditionally for high school kids or those starting off in the work world to gain some skills.
When wages go up so does cost, in the end it all balances out. Once prices go up, it rarely comes down. All the major corporates will just move to automation and cut costs by letting go manual labor. Minimum wage workers will be out of a job while cost of living will increase due to their support for higher minimum wages. It will also drive small businesses out of business. Who wants to work at Joe’s Burgers for $15/hr when they can push a few buttons and work at McD for $20/hr? Then Joe’s Burgers is forced to raise cost on their food to the customers or suffer being understaffed. All you’re looking at is money, not understanding the consequences of this.
Chipotle already has machines that make burrito bowls and salads. They already have machines that make their guacamole. 50% of their sales comes from the mobile app. In a few more years they’d only need to staff a handful of workers.
Collective Bargaining is the negotiation of wages and other conditions of employment by an organized body of employees. Whatever meddling by government is designed to prevent private hired thug guards from duking it out with right to assembly collectives. There are civil laws regulating this process because the alternative is pitch “forks and torches” against private mercenaries.
We don’t want a repeat of this.
link to en.wikipedia.org
correct. some history is needed. and all that government wasted on giving hicks water and electric and schools, by FDR. think of the savings for the fat cat city slicker bankers and industrialists…….of new england
I thought inflation was a strictly a monetary phenomenon created by the expansion of money and credit.
Probably IS that Stupid. We have to remember that well over 99% of Americans actually BUY off on Government Narratives.
Err…. the government deciding how to price labor (or price anything else) is EXACTLY the opposite of a free market. Demanding wages above market prices simply creates unemployment. This is pretty basic stuff.
they cant control small business – that is why they are trying to eliminate us
The medical industrial complex would never have reached over 21% of GDP without government meddling paying 80% of healthcare dollars on patients last month of life. People used to die of natural causes all the time, and they still do.
What entitles unskilled labor to wages higher than the value of unskilled labor?
Published on Mises Institute (https://mises.org)
The Racist History of Minimum Wage Laws
April 16, 2017 – 5:28 PMChris Calton [1] Topics:
Big Government [2]U.S. History [3]
In 1966, Milton Friedman wrote an op-ed for Newsweek entitled “Minimum Wage Rates [4].” In it, he argued “that the minimum-wage law is the most anti-Negro law on our statute books.” He was, of course, referring to the then-present era, after the far more explicitly racist laws from the slavery and segregation eras of United States history had already been done away with. But his observation about the racist effects of minimum wage laws can be traced back to the nineteenth century, and they continue to have a disproportionately deleterious effect on African-Americans into the present day.
The earliest of such laws were regulations passed in regards to the railroad industry. At the end of the nineteenth century, as Dr. Walter Williams points out, “On some railroads — most notably in the South — blacks were 85–90 percent of the firemen, 27 percent of the brakemen, and 12 percent of the switchmen.”Walter E. Williams, South Africa’s War Against Capitalism (New York: Praeger, 1989), p. 74.
The Brotherhood of Locomotive Firemen, unable to block railroad companies from hiring the non-unionized black workers, called for regulations preventing the employment of blacks. In 1909, a compromise was offered: a minimum wage, which was to be imposed equally on all races.
To the pro-minimum wage advocate, this may superficially seem like an anti-racist policy. During this time, with racism still rampant throughout the United States, blacks were only able to enjoy such high levels of employment by accepting lower wages than their white counterparts. These wage-gaps at the time genuinely were the product of racist sentiment.
But this new wage rule, of course, did not eliminate the racism of nineteenth-century employers. Instead, it displaced their racism at the expense of black workers. One white union member at the time celebrated the new rule for removing “the incentive for employing the Negro.”Sterling D. Spero and Abram Harris, The Black Worker (New York: Kennikat Press, 1931), p. 291. This early minimum wage rule was explicitly put in place to prevent African-Americans from finding employment, and it was successful in this goal.
In the 1930s, racial views had hardly improved, if at all. Despite this, the unemployment rate among blacks was actually marginally lower than that of whites.Thomas Sowell, Basic Economics: A Common Sense Guide to the Economy, 3rd ed. (New York: Basic Books, 2007), p. 250. Like the railroad workers, this was due to their willingness to accept lower wages than whites. But as infuriating as the employer racism at the time might be, the 1930s wage laws should incite even more anger.
In 1931, Congress passed the Davis-Bacon Act, requiring uniform wages for any workers
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The Racist History of Minimum Wage Laws link to mises.org
employed in federally funded public works projects. In 1933, the National Industrial Recovery Act was signed into law, mandating industry-specific wages throughout the economy. In 1938, the Fair Labor Standards Act — the only one of the three to remain permanently on the books — took effect, initially imposing a federal minimum wage for any worker engaged in interstate commerce.
All of these laws served to price African-Americans out of the job market. Rather than forcing employers to pay non-racist wages, it simply forced blacks to shift from suffering race-motivated wages to suffering race-motivated unemployment.
The industries that were not governed by minimum wage laws demonstrate the market’s propensity to raise the relative income of discriminated people. In the 1920s, for example, popular black performers were starring in Broadway plays alongside whites. In the 1940s, Jackie Robinson broke the color barrier in Major League Baseball, despite the racism in professional sports. Meanwhile, blacks in civilian and government jobs were being pushed out of their industries by wage floors.
By the 1960s, many African-Americans were employed as farmers — at least partly due to this being one of the few remaining fields of work that was not yet subject to wage regulations. This changed in 1967, when the government extended the minimum wage laws to American farmers as part of the “War on Poverty.” Black farmers who were accustomed to making a modest $3.50 per day were now legally required to be paid $1.00 per hour — a tremendous increase in wages.
The effect of this law was immediate and undeniable. An estimated 25,000 farm workers were put out of work in the Mississippi Delta region alone.James C. Cobb, “Somebody Done Nailed Us on the Cross: Federal Farm and Welfare Policy and the Civil Rights Movement in the Mississippi Delta,” The Journal of American History (December 1990): 912–36. Black farmers were not oblivious to the cause-and-effect at play. “That dollar an hour ain’t worth nothing,” said the wife of one day-laborer. “It would have been better if it had been 50 cents a day if you work every day.”Des Moines Register, February 27, 1968, p. 2. Fifty cents per day, of course, was a lower wage than what her husband would have been earning prior to the law. Her point was clear: the federal minimum wage destroyed their ability to earn a living.
Instead of raising the wages of the predominantly-black farmers, the new law sped-up the move toward mechanization and ushered in the use of chemical weed killers instead of the previously more economical human weed pullers. Meanwhile, black migration out of these farmlands occurred by the thousands; the New York Times in 1968 called it the “Negro Exodus.”
Whatever your feelings on the status of racism in America today, it is difficult to argue that the United States is actually more racist than it was during the Jim Crow era. In that time span, the country has gone from making African-Americans drink from different water fountains to electing the first black president. Yet, despite this distinct improvement, the unemployment rate of black teens is roughly double that of whites [5]. In 1948, by contrast, the unemployment rate among teenagers was the same between the races.Sowell, Basic Economics, p. 251. Despite the widespread racism remaining in the country following the emancipation of slaves, the rise of a black middle-class started to emerge quickly and continued for decades. But thanks to meddlesome laws passed by presumably well- intentioned bureaucrats, the government has only served to stifle this upward trajectory.
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[6]
I always say that I raised nicer kids than my Mother did, and as adults my kids make a valuable contribution to humanity by being kind productive people. I hope Mr. Friendman was able to raise nicer kids than his mother did. It would be interesting to hear his economic analysis on Adolf Hitlers labor laws with respect to ethnicity.
mises inst. is always illuminating. thanks
TL:DR
But it looked good.
Yeah, like I’m collecting all this “free” money from my bond coupons and stock dividends. Not that I’m complaining, let’s just be honest.
You paid for the shovels. Labor would dig with their fingernails without you.
ha ha ha. owners and serfs. the eternal divide among human primates……….
inflation is all about currency debasement. and the FED is only in business to keep their owners, the NYC bankers solvent and in high cotton, no matter what it takes. the union v non union argument is silly, and is a serf’s distraction. the serfs are easily divided and conquered throughout history. unless we are talking about government worker unions. even FDR correctly understood that is wrong. they strike against the taxpayers. the owners of the fed are laughing all the way to the reloaded bazooka for bank bailouts……….
Thanks MPO45v2 for your compassionate comment. I know it rubs some people who have a financial leg up on things, when they see how their exploitation modeled pedestal they stand on is is wobbling. I know I disagree with you a lot when I hear you talk as if money is the only end game, but in my mind you said something right and then get 23 down votes. It shows how hateful people on this forum are towards their fellow man.
I feel like you went to a revival tent meeting and actually heard and embraced the part about “Love one another” Keep those salient thoughts coming
Unions fund Joe and he has to kick it back somehow. 40% for the UAW … I always tried to buy American … but now Tesla is the only sane American car company. The good news is … Joe and Barrack have given billions in taxpayer $s to the unions in the past … I’m sure they’ll do it again.