Sunday, November 18, 2012

Twinkies Will Live On

Twinkies will live on. I predict that someone in China will make them, that's all. People keep blaming corporations and greedy capitalists for sending jobs overseas. Nope, it's the greedy 'progressives' who make doing business in America so unprofitable that no right minded businessman would embark on such a fool's errand.

People like to say "okay, maybe unions are too powerful now, but they filled a need at one time". Nope, anyone who understands the free market knows that wages and prices float to the optimal value for goods and services as long as there is competition for those goods and services.

'Progressives' point to sweatshops and child labor as justification for ignoring economic laws. Markets exist only if people are willing to participate in them. Markets represent opportunities as well as risks. When I was in high school, I was looking for child labor. I found farm work. I would have preferred factory work. A "sweatshop" if you will.

If an employer exploits his workers, there is a price to pay. It turns out, that price was the formation of unions and government regulation instead of the natural and inevitable market correction. I think those artificial measures were poor solutions, for which we are paying dearly now.

There is no way that wages would ever float to zero. Think about it: Employers need workers to produce their product. Smart workers will naturally find the employers who will pay fair market value for their services. Stupid or lazy workers might keep working for sub-standard wages, but the employer gets what he pays for, doesn't he? And it's an incentive for the stupid or lazy workers to get smarter and become more industrious.

If the fair market value for labor ever went to zero (or even if it went below the ridiculous and arbitrary minimum wage set by government in complete ignorance of the fair market value), the work force would literally die off, or leave the country, and employers would have to start paying more if they wanted to stay in business. It is simply economic reality that they would ignore at their peril.

Similarly, it is also economic reality that wages may be lower than workers might want. They can try to ignore that reality by forming unions, striking, and using other strong-arm techniques to blackmail employers into paying more for their services, but reality doesn't take a vacation. Sometimes, reality bites. And now, reality has taken a big bite out of Hostess Twinkies.

The employer, overburdened with government regulations, including ObamaCare, union demands and a down economy, has gone under, resulting in the loss of an employer, the loss of thousands of jobs nationwide, including -- eventually -- secondary and tertiary ones in related businesses. And it has deprived millions of people of the simple, if unhealthy pleasure of eating a Twinkie. The union could have helped prevent this by accepting reality and reducing its demands. Instead, it killed the goose that lays the golden eggs, and for what?

Economic laws are as real as the laws of thermodynamics, which say there is no such thing as perpetual motion. Economic laws say there is no such thing as a free lunch. But not a day passes in which some 'inventor' claims to have invented a perpetual motion machine, or some 'progressive' claims to have discovered a free lunch. Economic stimulus, strikes, and minimum wage are the same as giving the perpetual motion machine a spin. It will coast for a while, but it soon grinds to a halt. It. Doesn't. Work. I blame the schools. Way to go, 'progressives'!

1 comment :

  1. I think they'll live on in Mexico: sugar cane is major export there. Factories perfectly suited to making Twinkies already exist. Very popular in Mexico.


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