Posted by
Savant Noir on Sunday, March 15, 2009 3:09:27 PM
One of the businesses I own is a non-union Paving Company that does both smaller jobs and large-scale jobs. A small paving crew will typically consist of 2 roller men, 2 rakers, 3 laborers, and 2 paving machine operators, 1 tractor operator. In a non-Union shop such as mine, the 7 skilled operators tend to be interchangeable; doing whatever needs to be done to get the job done effectively. For example, we may be waiting an hour or 2 for the next asphalt shipment during which time the paving machine operators are not paving, nor is the roller man rolling. On my crew, the roller man then might hop on a tractor to stockpile debris, or may pick up a broom to clean some mess (these are just examples). My operators are paid $37.50/hr plus benefits. My unskilled laborers are paid $22/hr plus benefits. They are all paid one-way drive time on top of time spent working on the job, and drive to and from the jobs in company vehicles.
Now if you happen to be a Union roller man it is mandated that they be paid $57.50/hr. That’s $9,860/mo to the employee at a cost of almost $13,000 month to me (not including his truck, gas, cell phone, and truck insurance). While waiting this hypothetical 2 hours for more material to arrive to the job, there is still plenty to do, such as priming or tacking the next area, clean-up, edge treatment, etc. If my Union roller man were sitting there, I might yell out..."hey Juan, why don't you lend a hand over here and help get this next area ready"?! His answer would be: "sorry Boss, no can do, not in my job description", and he would not get off the seat or move for that entire 2 hours of lag time. He would turn on his radio, grab his lunch box, kick up his feet, and wait. I could not fire him either.
During the course of a "normal" job (non-Union), at the end of the day, the Operators leave and the clean-up crew and roller man are left finish up. They typically work one hour longer than the rest of the boys to get things done. If it were a Union job, the chances are the job would not even get done in 1 day, and no matter what, the speed at which they work is such that to finalize the job, they are usually on-site for an additional 3 hours (thus, milking the job for time and half).
I relate this because I vehemently oppose the EFCA. There are some good Unions in this country, and you never hear about them dragging economies down. But Construction unions are historically debilitating. My primary objections to the EFCA are two-fold. One example is above. The second objection is that compliances, wages, benefits, etc will be DICTATED by the Federal Government. Some agent, whom knows NOTHING about a particular industry, can come in and indiscriminately set any price he wants. He may say: "You have to pay a roller man $75/hr". (surely it will be some price above the current going rate, just so they can justify how good they have been for the American worker).
Inasmuch that the mission is to unionize EVERY company with 3 or more employees, imagine the impact. Imagine having to pay the girl that answers the phone $22/hr. Imagine how the wealth will be re-distributed. Now imagine the impact upon Society. Of course Juan will be rejoicing that now they are making $155,000/yr (plus truck, phone, gas, insurance, and a job for life with benefits)...can't say I blame him...BUT...
Let’s look at a bigger picture. I completed a private-sector (non-Union) $4,000,000 paving job last year for a subdivision (new tract of homes). The Developers price to develop the site was 335 million. They in turn sold the improved land to Builders, hoping to make $50,000 per lot. The Builders built homes starting at 1.3 million dollars, again, each marking up their base house $50,000.
When all this work becomes unionized, the cost for developing this site would probably escalate to about 800 million. That 1.3 million dollar final product house will now probably have to sell for around 4 million dollars, just to make the same $50,000 profit. Now, imagine the impact to our cost of living when ALL companies are unionized. Imagine the cost of living when ALL goods and services carry this burden. It’s a good thing that Juan got this huge raise, because his dollar isn’t going to go very far. But that’s not all...
What about me? Let’s assume I make $250,000/yr. I work on a Gross Profit of 15% and a hopeful Net Profit of 7%. What used to be a $50,000 job is now a $100,000 job, for I had to pass these increased costs of operations on the consumer. Small property owners struggling to collect their monthly rents may put off spending money on capital improvements; they simply will not be able to afford it until the necessary rent increases begin to build up capital reserves. Naturally, in this process some of their tenants may go out of business as people deem having to pay $15 for having a shirt dry-cleaned as too much money. This in turn will make capital reserve goals for the Landlord a much more sluggish process. I will probably lose 20% of my business as the lower end of the market dries up. As this lower end of the market erodes, it will further drive up costs on the bigger projects. The scarcity of work will drive profits down and ultimately lead to the failure of many small businesses.
The workers believe they are benefitting. That myth will soon be debunked. Everyone in Society loses, and the Owner (me, the one strapped with ALL the responsibilities), doesn't get one iota more money out of the deal, in fact, it may be very hard to even sustain the continuation of the business and the employment for others. The notion that this will create a thriving market is erroneous, for you and I will be getting hammered. Juan has not really seen any increase of wealth as his extra money is eaten up by the increased cost of living. This insures that middle class and upper-middle class individuals cannot ever really hope to make it to "wealth" or even get ahead at all.
In this simple model outlined above I have not even taken into account the myriad of both known tax increases and new tax burdens still being kicked around, that are going to be levied against ALL individuals and businesses, regardless of income. While Juan has this perceived increase of salary, his ultimate take-home pay increase will scarcely be noticeable. The only thing that will be noticeable is that their standard of living is less, as the cost of living goes through the roof. Also not taken into account is the impact this will have on unemployment. We have all heard how small business is responsible for 70% of the jobs in this country. Small businesses will be collapsing left and right under the weight of all these burdens.
What about our leaders? They have already amassed their wealth, none of this affects them. Once you have wealth, all that is left to accumulate is Power. If you or I should accumulate wealth, we then become a threat to Power. People with power is the antithesis of a Socialistic society, the very thought of having a challenge to power is anathema to the Leaders. Anyone supporting this Bill must think the American people are stupid has they shovel out their drivel of corruption. I put forth to any Union or any Politician the following question:
Explain how it is that mandating increased wages and benefits by being forced to hire workers that are not compensated by merit, but rather only by 'length of service' will help this economy when:
1. The increased burden on cost of operations will be passed thru onto all goods and services?
2. When all the new tax increases will effectively raise Federal Taxes to 53%, that too being passed on to goods and services?
3. When all Americans (even the incompetent and lazy union workers) will be hit with increased taxes, driving the cost of living up, while driving the amount of disposable income down?
How stupid do you think the American people are? Answer these questions and give us a lesson in how your corrupt economics work.
So, this is how re-distribution of wealth works (in the most easily understood pragmatic way I could think of to express). This is how Power works. This is where we are headed; this is what we will become. Wherever you are at in life, live with it...because the chances to move higher are being taken away from you.