Beto O’Rourke recently unveiled his labor plan which consists of a $15 minimum wage and measures to increase compulsory unionization.
The former El Paso congressman believes that no one in America should be living below the poverty line, hence his support for a $15 minimum wage. Similarly, O’Rourke contends that such a wage increase would boost worker productivity. The $15 minimum wage is in vogue among leftist elites, with states like California and Washington leading the way.
In addition, O’Rourke laments the decline of labor unions in America. He believes that their declining membership is the reason behind stagnating worker wages in the United States. To solve this dilemma, he wants to recruit more union members and strengthen collective bargaining through legislation.
The 2020 presidential hopeful’s vision on both of these issues is fundamentally flawed. It ultimately entails getting more government involved in areas which already have too much state interference to begin with. Let’s start with the increased minimum wage.
O’Rourke’s desire for increasing the minimum wage will end up hurting workers; above all, the lower-skilled members of the labor force. Unemployment, reduced work hours, and companies accelerating their automation processes will be several of the results of these policies. It’s not exactly a pretty scenario for someone who claims to fight for workers’ interests like O’Rourke does.
Similarly, O’Rourke’s aim for increased unionization is both economically damaging and morally questionable. Unionization is always an emotional topic. Many people praise unions for bringing the 8-hour workday, despite evidence showing that it was capitalist innovation and not government regulation that brought about greater leisure time starting in the early 20th century. Unions did serve a purpose in highlighting some of the questionable working conditions during the industrial age, but they’ve outlived their purpose in the 21st century.
Nowadays, they function as thuggish appendages of politicians and violate the freedom of association of millions of workers nationwide. The right-to-work movement, which strives to make mandatory union dues no longer a condition of employment, has scored numerous victories across America. Right-to-work is present in 27 states and has helped create a more free and dynamic work environment for millions of workers. However, all this progress could go to waste if O’Rourke’s program were to go into effect.
With all this talk about boosting worker productivity, we should first understand how this is actually achieved. Capital accumulation is key in addressing this question. O’Rourke’s plan is chock-full of government intervention, which ultimately stifles capital accumulation, thus stagnating our standard of living.
President Trump should receive some praise for his deregulatory efforts in matters of income taxation and cutting back arbitrary regulations. This has given businesses big and small some breathing room to operate during the last two years. Although Trump may not be going far enough, his efforts are going in the right direction. The same cannot be said about O’Rourke’s labor plan.
If O’Rourke wants to actually help workers, he should look at Trump’s example and double down on deregulation. Government intervention is still the biggest obstacle towards increasing our standard of living. O’Rourke’s current labor plan only exacerbates that.