Blumneconomics II

Fresh from last week's suggestion to double the pay of tomato pickers, that pinata of the St. Petersburg Times is back again with another economic prescription: Unionize to the max.

After reviewing the admitted past success of labor unions in obtaining decent working conditions during the progress of the industrial revolution, Blumner veers into Paul Krugman territory to bemoan the dreaded income gap.

Paul Krugman, a New York Times columnist who teaches economics at Princeton University, argues in his new book The Conscience of a Liberal that it is not the impersonal market forces of globalization and technological change that have stagnated Americans' living standards and caused income inequality to reach levels not seen since the age of the robber barons. It's a direct consequence of conscious decisions of government, driven by conservative Republicans, to cut taxes on wealth and undermine labor organizing.

Krugman points to Western Europe, which is subject to the same pressures from globalization and technology as the United States but has not experienced by any stretch the same rise in income inequality.

(St. Petersburg Times)

Blumner tends to mention Krugman in her columns regularly. Just sayin'.

I wasn't aware that the living standards of American's had stagnated. We drive more cars, own more cell phones, and watch bigger televisions (with more elaborate sound systems) then ever before. A recent economic study suggested that after adjustment for dangerous activities based on personal choice that American's have a better life expectancy than Western Europeans.

It is precisely globalization that permits that higher (not lower) standard of living. Trade benefits both parties. That's fundamental to economics; I can't say where Krugman lost his way. Power to labor unions will mean protectionist policies like Bush's steel tariff policy or the type of labor arrangements currently hamstringing U.S. auto manufacturers in international competition. If GM didn't have the weak dollar to fall back on (making their cars quite a deal in foreign markets at the moment) they'd be in real trouble.

And how Blumner got off on the income gap from decent labor conditions will probably remain a mystery until she starts explaining her reasoning within the context of her editorials (that is to say it may never happen).

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