In an attempt to not hijack Freejooky’s thread on a dual minimum wage any more than I already have, I’m starting a new thread.
My question is predicated on a few assumptions; if they are wrong, please let me know.
- A wholly free market would be an economy without watchdog/ testing groups run buy the government.
- The government would impose no restrictions, be they economic, environmental or labor-oriented.
- Such a government has (for all intents and purposes) never existed.
I don’t know a lot about economics, and am more comfortable dealing in concrete examples than in abstracts in this area. To that end, here’s an example, which you can pick up to help explain your views to me, or ignore completely if it isn’t ideal.
As I have mentioned many a time, I’m a TA at Madison, though in my case the title ‘TA’ is a bit of a misnomer, since I actually plan and teach the entire class on my own. Our salary is not paid by the UW, but rather the state of WI: I’m a government employee. A few years ago, our ‘Democrat’ (I’m trying to avoid snark in the post, but Doyle is a fake Democrat to my mind) governor, Jim Doyle, announced that all state employees would be paying part of their health insurance premiums. Since the reputation of state employees is right up there with IRS agents and repo men, this was a popular move. It scared the crap out of me. This is the first time in my life I’ve had health insurance that actually covered anything, and that wouldn’t quadruple the rates for daring to fill a prescription. I was able to get my tonsils taken out and stop missing a few weeks of work/ school every year because of chronic infections. I no longer had to pay $100/ month for my depression meds. I am and was grateful for the insurance, and it was a part of the reason I chose to go to WI.
Anyway… our union balked. We had taken a steep pay cut (TA’s at WI make several thousand less/ year than those at our sister institutions) several years earlier in exchange for the free (not paying premiums) health care. The average TA salary is around $10,000/year, and since the state refused to tie the cost of the premiums to our wages, we were faced with paying 50,100,200/month in premiums (who knows?) The state explicitly told us the move to force all state employees to pay was political, not economic, as they proved by rejecting several of our offers that would have saved the state hundreds of thousands and still preserved no-premium health insurance. We (and about 2/3 of the other state employees) have been deadlocked for close to two years.
So, a few weeks ago, I get a chance to talk to one of the more outspoken conservatives on campus. He says we ought to have taken the state’s original offer (no raise first year - 2003, 1% second year - 2004, paying for premiums $9/month for singles, 23/ families -again, I have no financial problem with the $9/month, but rather the fact that the state would not put some sort of limit on raising it, and other universities have raised premiums well above $100/month). I say, Why on earth would I assume the state will do what’s in our interest? We have no guarantee that the state wouldn’t raise the premiums as much as they like; we haven’t gotten a raise in three years; they have told us the move was political, and they don’t really care if they saved money or not. Based on its history, I don’t feel like the state has been terribly generous with us. Why should I expect differntly in the future? His answer: the market will sort it all out. Me: Huh? Based on what? Isn’t this the same market that has been raising health insurance for everyone to astronomical levels? Isn’t this the same market that hasn’t even given me a cost-of-living raise in several years?
If under a somewhat-controlled market (the system in which we currently live) companies are still able to screw over the little guy, why would I believe they would do differently when those safeguards are removed? How would a free market make another Enron, or environmental pollution, or passing the rising insurance costs onto employees impossible?