First, Reich’s assertion that America’s growth and
prosperity rest on a “basic bargain” that corporations pay their workers
enough so that they can buy their products is wrong. Reich claims the bargain was pioneered by Henry Ford in 1914, who decided to pay his workers enough to buy his Model T’s.
Second, historical statistics show Reich’s
assertion that the Great Depression was caused by businesses allowing
wages to stagnate and profits to soar in the 1920s is false.
It appears that Mr. Reich's supporters (e.g., allen) follow suit and show no manners. Oh, Behave!
ReplyDeleteSo, I direct this to Mr. Reich: Going against the principles of economics gets you so far Mr. Reich. Soviets did. Now, they have no country or economy or democracy.
Mr. Reich may have one thing going for him. Since, 35% of wages and salaries are social welfare benefits, then increasing minimum wage will reduce this percentage (for those who can hold on to their jobs).
"...enterprise...supply the buying public in the best possible and cheapest way with those commodities and services...' [Ludwig von Mises]. In a global economy, higher minimum wage increasing cost of production at home (US) diverts consumer demand towards foreign products. One must ask Mr. Reich, ceteris paribus, If Ford costs more than Toyota, then which one will 'you' buy? ( note: the use of 'you' is of the royal variety')