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October 26, 2007
Section: Business
Edition: MAIN
Page: 5B

Self-serving free trade practices reason behind stretched paychecks


Saturday's Citizen-Times front page article, "Many paychecks stretched to breaking point," described what increasing numbers of Americans are experiencing.
Comments on the AC-T's online forum indicate that it was already clear to most Ashevilleans that our economy is producing record numbers of billionaires and multimillionaires, as well as record numbers of citizens dropping out of the middle class.

It may not be as clear that our government always determines the extent to which various classes of citizens share in the nation's productivity.

For example, at one time American business owners could own slaves and pay them virtually nothing in exchange for their work. Those in charge of government allowed the practice because, after all, this class of people were considered savages. Of course, it could be argued that the slaves weren't actually American citizens and did not qualify for government protections.

Children affected

Children, however, represent an obvious class of American citizens whose welfare has been affected by government. For interesting reading, Google "child labor laws" and check out our nation's record during the early 1900s. At one time, all southern states, except North Carolina, dictated that children younger than 13 could not work in textile mills. North Carolina kept its age limit at 12 in order to have an edge in attracting industry.

Fast forward to 1938 when a liberal President Roosevelt and a liberal Congress passed the Fair Labor Standards Act, which stated that children younger than 16 couldn't work in full-time nonfarm jobs, the minimum wage would be 29 cents per hour, and workers would be paid time-and-a-half for working more than 40 hours a week.

This legislation not only protected the interests of poor children (rich children didn't work in factories), but it also established the 40-hour workweek as the American standard, and was the beginning of America's affluent middle class.

This, at a time when we had 19.9 percent unemployment, children younger than 16 were working in factories up to 70 hours a week.

Fast forward again to today, and consider the bottom 40 percent of America's workers those in the service industries, farm laborers, secretaries, garbage collectors, etc. Apologists for the rich and powerful state that the reason their wages are low is that they lack education. Nonsense.

If the bottom 40 percent of our citizens all got "educated," we still would need workers to do those jobs. Would we as a nation still deny them living wages? After all, these "educated" persons would be doing our hardest, least personally self-rewarding, and often most dangerous and health-destroying jobs.

Neocon solution

Face it. Controlling the supply of labor is the way government controls wages either low, high, or about right compared to the incomes of investors and business owners. Since slavery and child labor are now illegal, our neoconservative government is left, primarily but not exclusively, with globalization and legal and illegal immigration.

By exposing American workers to the world labor market, they have, in effect, forced them to compete with workers in nations that have virtually no worker protections, especially in the Third World.

For jobs that can be done only within our own borders, the key to controlling the labor market is to bring in desperate foreign workers to do the work many Americans won't do at least for the low pay and brutal working conditions that are associated with record corporate profits. And, of course, those Americans still in those jobs see wages depressed because of oversupply.

There is no such thing as a "free market," unless government defines it. Are businesses free to compete in providing the best products and services at the lowest cost, while observing established minimum standards for the treatment of workers? Or, is the free market one in which the most powerful and unscrupulous employers are free to drive out of business those who want to treat their workers decently?

The people we elect to government always decide, and they legislate accordingly.

Charles M. Kelly is a retired management consultant living in Burnsville and is author of "The Destructive Achiever, Power and Ethics in the American Corporation," and "Class War in America." He can be reached at