Free To Choose 1980 - Vol. 08 Who Protects the Worker? - Full Video
Summary
TLDRIn this episode of 'Free To Choose,' Milton Friedman explores the labor market and the impact of labor unions on workers' welfare. He challenges the notion that unions are the key to workers' prosperity, citing historical and contemporary examples to argue that a free market system, not unions, has been the driving force behind improved living standards and job opportunities. The discussion also touches on minimum wage laws, immigration, and the role of government in the economy, highlighting the tension between the protection of workers and the promotion of economic freedom.
Takeaways
- đ The discussion revolves around the question of who truly protects workers: labor unions or the free market system.
- đ Milton Friedman argues that labor unions, while benefiting their members, can act as a throwback to pre-industrial times and may not be essential for societal progress.
- đïž Historical references are made to the Hippocratic Oath, suggesting that early forms of guild-like restrictions on practice and knowledge sharing have parallels in modern labor unions.
- đ The role of paramedics and private enterprise in emergency care is highlighted as an example where non-traditional medical practitioners can provide effective care outside of conventional, unionized settings.
- đ ïž Disputes between union and non-union workers can lead to violence and destruction, as illustrated by the coal loading dock incident in Indiana.
- đą The federal government's role in supporting labor unions is examined, with the proximity of union headquarters to Capitol Hill suggesting a strategic positioning for influence.
- đŒ The impact of minimum wage laws on employment opportunities, particularly for unskilled and minority workers, is debated as potentially discriminatory.
- đŠ Examples of government job security and the challenges of firing civil servants are given to contrast with the flexibility of the private sector.
- đŸ The agricultural industry's reliance on undocumented workers and the economic contributions of immigrants are discussed, emphasizing the complexity of immigration and labor policies.
- đ The economic transformation of Spartanburg, South Carolina, through the adoption of Right to Work laws and tax cuts is presented as a successful model of free market policies fostering growth and opportunity.
- đ€ The overall theme is the advocacy for a free market system, where competition and individual merit, rather than union membership or government intervention, drive economic prosperity and worker welfare.
Q & A
What is the main argument presented by Milton Friedman in the film series 'Free To Choose' regarding labor unions?
-Milton Friedman argues that labor unions, while benefiting their members, are not the key to the development of modern society and can be seen as a throwback to pre-industrial era practices, such as the agreements among craftsmen in the Middle Ages or the Hippocratic Oath among medical practitioners in ancient Greece.
According to the transcript, what does Friedman suggest was the source of improvements in workers' conditions over the past two centuries?
-Friedman suggests that the improvements in workers' conditions were not primarily due to labor unions, especially considering the 19th century when there were hardly any labor unions but workers still fared well. He implies that other factors, such as economic growth and technological advancements, played a more significant role.
What is the Hippocratic Oath, and how is it related to the discussion on labor unions in the transcript?
-The Hippocratic Oath is a code of conduct established by physicians and medical practitioners on the Greek island of Cos, which includes ideals for protecting patients as well as restrictive practices similar to modern labor unions. Friedman uses it as an historical example to illustrate how such restrictive agreements can limit access to a profession and protect the interests of a select group.
What role does Friedman believe the American Medical Association (AMA) has played in the United States?
-Friedman describes the AMA as one of the strongest labor unions in the country, which has kept down the number of physicians, increased the costs of medical care, and prevented competition, all in the name of helping the patient.
How do labor unions affect the labor market according to the viewpoints expressed in the discussion?
-The discussion suggests that labor unions can restrict the labor market by favoring their members with higher wages and better working conditions, often at the expense of non-union workers who may face reduced opportunities. This can lead to a decrease in overall employment opportunities and potentially stifle economic growth.
What is the 'Right to Work' law mentioned in the transcript, and how did it impact Spartanburg, South Carolina?
-The 'Right to Work' law is a law that prohibits agreements between labor unions and employers that make union membership a condition of employment. In Spartanburg, this law, along with tax cuts and pro-business policies, helped transform the economy by attracting new industries and creating a more competitive labor market, leading to increased job opportunities and economic growth.
What is the controversy surrounding the minimum wage as discussed in the transcript?
-The controversy lies in the differing views on the impact of minimum wage laws. Some argue that minimum wages protect workers by ensuring they receive a fair wage for their labor, while others, like Friedman, argue that they can lead to unemployment, especially among the young and unskilled, by pricing their labor out of the market.
What is the role of government in labor market regulation according to the transcript?
-The transcript suggests that the government plays a significant role in labor market regulation through laws such as minimum wage legislation and the right to form and join labor unions. However, there is debate over whether these regulations protect or harm workers and the economy as a whole.
How does Friedman view the relationship between immigration and the labor market?
-Friedman believes that unrestricted immigration can be beneficial in a society without a welfare system, as it allows for the free movement of labor in response to job opportunities. However, he acknowledges that with a welfare system in place, unrestricted immigration can lead to issues, as people may immigrate to take advantage of welfare benefits rather than for employment.
What is the position of labor unions on minimum wage according to the transcript?
-According to the transcript, labor unions are major supporters of minimum wage laws. They lobby for these laws, believing that they protect the interests of workers by ensuring a baseline level of income.
What are the key points of disagreement between Friedman and the labor representatives in the discussion?
-The key points of disagreement include the overall impact of labor unions on worker prosperity, the necessity of minimum wage laws, the role of government in regulating the labor market, and the effects of economic freedom on the broader society.
Outlines
đ„ Introduction to Labor Market Discussion
Robert McKenzie introduces a discussion on labor markets and unions at the Harper Library, University of Chicago. The focus is on Milton Friedman's film 'Free To Choose,' which questions the role of labor unions in worker protection and progress. Friedman challenges the belief that unions are responsible for workers' progress, citing historical evidence and the modern situation in the U.S. where a significant portion of workers are non-union members. The script also delves into the historical roots of labor unions, drawing parallels to ancient Greek craftsmen's agreements and the Hippocratic Oath, suggesting that unions are more of a pre-industrial era practice.
đ Medical Profession and Labor Unions
The script explores the American Medical Association's role as a labor union, discussing its impact on physician numbers, medical care costs, and competition. It contrasts the traditional medical licensing process with the role of paramedics in emergency care, highlighting the effectiveness of the latter. Paramedics argue that their contribution to emergency medical care is significant and should not be restricted by medical licensing monopolies. The narrative also touches on the historical context of labor unions and their restrictive practices, which are likened to the Hippocratic Oath's limitations on medical knowledge dissemination.
đ Labor Unions and Market Restriction
The script presents a debate on the role of labor unions in protecting workers, using the backdrop of a coal loading dock strike and the ensuing conflict. It discusses the perspective of non-union workers and contractors who believe in the freedom of choice regarding union membership. The narrative then shifts to the federal government's role in supporting unions, illustrating the political influence of labor organizations in shaping labor legislation. The discussion also covers the impact of minimum wage laws on unskilled labor, suggesting that such policies often harm the very people they are intended to protect.
đœïž Impact of Minimum Wage on Employment
The script examines the effects of minimum wage laws on the job market, particularly for unskilled workers, minorities, and young people. It uses the example of a staff restaurant in the Department of Housing and Urban Development to discuss the benefits and job security provided to federal workers. The narrative then shifts to the experiences of an electronics engineer in Silicon Valley, illustrating how a free labor market can benefit both employers and employees, in contrast to the restrictions imposed by labor unions and minimum wage laws.
đŸ Agricultural Labor and Immigration
The script addresses the issue of undocumented workers, particularly in the agricultural sector, where they are often needed during harvest seasons. It discusses the challenges faced by farmers who rely on this workforce and the potential consequences of legislation that would make hiring undocumented workers illegal. The narrative highlights the economic contributions of these workers and the potential backlash from the farming community if such laws were enforced.
đ Economic Revival Through Free Trade
The script tells the story of Spartanburg, South Carolina, which transformed its economy by adopting a free trade approach. By enacting a Right to Work law, cutting taxes, and attracting international investment, the city experienced an industrial revolution that benefited both workers and employers. The narrative showcases the positive outcomes of a free market system, where increased competition and opportunities lead to economic growth and improved living standards.
đ€ The Benefits of a Free Labor Market
The script concludes with a discussion on the merits of a free labor market, emphasizing how higher wages and better working conditions can be achieved without the need for labor unions or government intervention. It highlights the success of workers who have benefited from the competitive nature of the job market, as well as the broader economic benefits of increased productivity and capital investment. The narrative stresses that the prosperity of a nation is a result of a free enterprise system that allows for the fair distribution of economic gains.
đłïž Labor Unions and Democratic Society
The script captures a debate on the necessity of labor unions in a democratic society. Participants discuss the role of unions in protecting workers' rights and the potential negative impacts of excluding non-union members from certain benefits. The discussion also touches on the historical context of labor movements and their importance in the evolution of workers' rights. There is a clear division in opinions, with some panelists advocating for the indispensability of unions in a democratic framework, while others question the current relevance and effectiveness of union practices.
đ International Labor Market Dynamics
The script delves into the complexities of opening the labor market internationally, with panelists discussing the feasibility and implications of such a move. The conversation centers on the interplay between labor market freedom, immigration policies, and the global economy. Participants express differing views on the potential benefits and challenges of unrestricted labor movement, highlighting the need for a balanced approach that considers both economic opportunities and societal impacts.
đïž The Role of Government in Labor Protection
The script presents a heated discussion on the role of the federal government in protecting workers, with a focus on the historical context of labor movements and the current state of workers' rights. Panelists debate the effectiveness of government interventions, such as minimum wage laws and occupational health codes, in safeguarding workers' interests. The conversation also touches on the issue of undocumented workers and the need for legal protections, reflecting the diverse perspectives on how best to support and empower the workforce.
đ Conclusion on Labor Market Freedoms
The script concludes with a recap of the key points made during the discussion, emphasizing the importance of economic freedom and the potential risks of abridging it. Panelists reflect on the balance between government intervention and market freedom, with a particular focus on the implications for workers' rights and societal prosperity. The closing remarks underscore the need for a nuanced approach to labor market policies that respects individual freedoms while also ensuring equitable opportunities for all.
Mindmap
Keywords
đĄLabor Market
đĄLabor Unions
đĄHippocratic Oath
đĄFree Market
đĄMinimum Wage
đĄParamedic
đĄRight to Work
đĄImmigration
đĄCapital Investment
đĄProductivity
đĄEconomic Freedom
Highlights
Milton Friedman challenges the common belief that labor unions are primarily responsible for workers' progress, noting that significant advancements occurred in the 19th century with minimal union presence.
Friedman argues that labor unions may benefit their members but can be seen as a regression to pre-industrial times, drawing parallels to ancient Greek craftsmen's agreements.
The Hippocratic Oath is highlighted as an early example of a professional code with restrictive practices, which Friedman suggests is contrary to the open teaching philosophy of Hippocrates.
Friedman criticizes the American Medical Association for acting like a strong labor union, limiting physician numbers, and potentially driving up healthcare costs.
The discussion explores the role of paramedics as an example of non-traditional medical practitioners providing effective emergency care despite resistance from established medical professionals.
Paramedic Joe Dolphin presents statistics showing a significant increase in survival rates of cardiac arrest patients due to the introduction of paramedic services.
Friedman raises the question of whether medical care should be a monopoly of licensed physicians or if others capable of providing effective help should be allowed to do so.
The transcript describes a violent incident at a coal loading dock where union workers attacked non-union workers continuing to work during a strike.
Harry Leef discusses the negative aspects of closed shops and the importance of allowing individuals the freedom to choose whether to unionize or not.
Friedman examines the influence of labor unions on federal labor legislation and their efforts to secure government support to gain power without resorting to violence.
The debate over the minimum wage's effectiveness in helping the poor is presented, with arguments that it may actually harm low-skilled workers, including a disproportionate number of minorities.
Friedman points out the inefficiencies and protections afforded to federal workers, suggesting that they may be overprotected at the expense of taxpayers.
The story of Dick Pashley illustrates how a free labor market can benefit workers, showing rapid career advancement based on skills and desire to work, without union involvement.
Friedman contrasts the free market's benefits with the restrictions and potential violence that can arise when market forces are interfered with, as seen with immigration control.
The case of Spartanburg, South Carolina, is presented as an example of economic revitalization through free trade policies, leading to increased foreign investment and job opportunities.
The discussion concludes with a debate on the role of unions and the free market in protecting workers' interests, emphasizing the importance of economic freedom and its impact on prosperity.
Transcripts
Hello, I'm Robert McKenzie, and welcome
again to the fine old Harper Library
in the University of Chicago.
A group of guests have come together
to see and to discuss the latest film by
Milton Friedman in his series,
Free To Choose. In this, he examines
the working of the labor market, and
role of labor unions, and again comes up
with some controversial views in answer
to the question: Who protects the worker?
(Opening music)
MILTON FRIEDMAN: People who earn their
living in a modern heavy industry seldom
engage in the kind of backbreaking toil that
was the everyday lot of most
workers a century ago.
And yet they earn far more.
What has produced these improvements?
The offhand reaction of most people is likely
to be that labor unions are largely
responsible for the enormous progress
that workers have made
in the past two centuries.
But clearly, at least for the United States
that cannot be true.
After all, in the 19th century,
when workers did very well,
there were hardly any labor unions at all.
And even today, no more than one
out of four or five workers is a
member of a trade union.
And the remainder do very well indeed
in achieving the highest level of
living in the world.
Labor unions do, of course, benefit their
members but, far from being a key to the
development of the modern society, they are
a throwback to an earlier pre-industrial era,
to the agreements among craftsman in the
Middle Ages or, to go back even earlier,
more than 2,000 years ago,
to the agreement
among medical men in Greece.
From the tiny Greek island of Cos, the coast
of Asia Minor is four miles away in the mist.
Twenty-five-hundred years ago a hospital
and medical school flourished on Cos.
The great Hippocrates, the founder of
modern medicine, worked there.
Legend has it that Hippocrates taught his
students in the shade of this plain tree.
He welcomed anyone who wanted to learn,
so long as they paid his fee.
There is another legend that St. Paul stood
here and preached the gospel of Christianity.
What isn't legend is that Hippocrates and
his followers started medicine on the road
forward to becoming a science.
When Hippocrates died at the age of 104,
or so legend has it, this island was full of
medical people, his students and disciples.
Competition for custom was fierce.
Some 20 years after he died they got
together and constructed a code of conduct.
They named it the Hippocratic Oath,
after their old teacher and master.
Every new physician, before he could start
practice, came to this spot back here in
front of those columns and took the Oath.
The oath was full of fine ideals for
protecting the patient.
But it also had a couple of other things in it.
Listen to this one, "I will impart a knowledge
of the art to my own sons, and those of my
teachers and to disciples bound by a
stipulation and oath according to the law
of medicine, but to none others."
Today we'd call that a closed shop.
Or listen to this one referring to patients
suffering from the agonizing disease of
kidney or bladder stones:
"I will not cut persons laboring under the
stone but will leave this to be done by
men who are practitioners of this work."
A nice market-sharing agreement
between physicians and surgeons.
Hippocrates must turn in his grave when a
new class of medical men takes that oath.
After all, he taught anyone,
provided only they pay his tuition.
He would strongly have objected to the kind
of restrictive practices that physicians
all over the world have adopted
to protect their custom.
In the United States the American Medical
Association has for decades been one of the
strongest labor unions in the country,
keeping down the number of physicians,
keeping up the costs of medical care,
preventing competition by people from
outside the profession with those in it; all,
of course, in the name
of helping the patient.
(ambulance siren)
(woman sobbing)
Without warning, anyone of us
may suddenly need medical care.
If we do, we want the very best
care we can get.
But who can give us that care?
Is it always a graduate of an expensive
medical school who has a union card
called a medical license?
Or might it be someone like this, a trained
paramedic working for a private enterprise
organization rendering emergency care?
PARAMEDIC: And hopefully we'll get
a very good contract out of that.
FRIEDMAN: Many such businesses
provide primary care for emergency cases
in the United States.
This particular paramedic team is attached
to a fire department in southern California.
They're good at their job.
But it's not unusual to find
local physicians objecting.
JOE DOLPHIN: They take the Hippocratic
Oath here in the United States and they
believe that they should be the one that
is treating their patient; they should be
the one that saves that patient's life.
And if someone else does it, it just kind of
interferes with everything that they
have been taught.
FRIEDMAN: But why should medical care
be a monopoly of licensed physicians?
Shouldn't anyone who is capable of providing
effective help be free to do so? PARAMEDIC: I'm going to take your
blood pressure here.
Okay, any one see him go down?
FRIEDMAN: You can be sure that no one
would be able to stay in this business very
long unless he can demonstrate by
performance that he's doing a good job.
Joe Dolphin knows that very well.
DOLPHIN: We've taken some statistical
samples of the kind of effectiveness
paramedics have in California.
Giving an example of that, in one district of
California that we serve which is a county
which is populated to the extent of 580,000
people, before the introduction of
paramedics, less than 1% of the patients
that suffered a cardiac arrest or their heart
stopped, lived through their hospital stay
and were released from the hospital.
But with the introduction of paramedics,
just in the first six months of operation,
23% of the people whose heart stops,
are successfully resuscitated and are
released from the hospital and go back
to productive working society.
We think that's pretty amazing.
We think the facts speak for themselves.
However, relating that to the medical
community is sometimes very difficult.
They have ideas of their own.
Respiration's 12 and regular by...
Looks good to me Dave.
How are you reading this down there?
Are you guys ready to go?
Yeah. It says Code Two. Code Two?
FRIEDMAN: Disputes between union
and non-union workers are not
always as high-minded as between
organized medicine and Joe Dolphin.
One day in 1978, workers at a coal loading
dock on the Ohio River in southern Indiana
continued to work after the Mineworker's
Union had called a strike.
That night, a crowd of armed
union men invaded the site.
JOHN PERSINGER: And then they fired on a
little building sitting here after they fired on
Mr. Teegarden's car here, and threw another
fire bomb into the trailer.
Others had run on back and were firing
trucks and shooting holes through
tires with handguns.
I'd gone back beyond the loading dock here.
Standing back in there, I could hear them
shooting and the air escaping
from truck tires.
Course there's so many people moving
around and doing so much damage and
setting so many things on fire...a whole
lot of things going on at one time.
We should have been heavily armed
and shot these people, did something
to stop such destruction.
I wouldn't have believed that a rabble rouser
could have gathered together that many
irresponsible people to come on to a
person's property and do this kind of
destruction until I'd finally seen it done.
FRIEDMAN: These workers are on
the other side of the union fence.
They're building two Social Security
offices in Baltimore.
On this government project
everyone's a union worker.
They rely on their union to protect them
against competition from non-union labor.
But some local contractors see a very
different side to a closed shop.
HARRY LEEF: We don't feel that anybody
should be denied a choice and we feel every
man should have a choice if he wants to be
unionized or not; not legislated,
not saying he must belong to a union.
We feel when you tell a man he must belong
to a union or he must do this or that,
you are taking freedoms away from this
man, the freedom of choice of this
businessman here to choose me,
to do business with me.
All business needs its right to choose
to do business with each other.
By the same token, our employees have
the right to choose whether they
want unionization or not.
FRIEDMAN: On this government site,
âAuthorized Personnel Onlyâ really means
âUnionized Personnel Only.â
Unions have long recognized that
the surest and most effective way
for them to get power without
violence is to have the federal
government on their side.
That's why so many strong unions have
made it a point to locate their headquarters
close to the source of power.
The heads of the trade unions that cluster
near Capitol Hill know this place very well.
It is the room assigned to the Committee on
Education and Labor of the House of
Representatives, and it is where much of our
labor legislation is discussed and shaped
before presentation to Congress.
I know rooms like this myself very well,
because I've often testified before
congressional committees and they all meet
in rooms like this.
Up there on the podium is where the
members of the House or of the Senate sit.
Of course, behind them there will be
clustered a bunch of aides.
As you know, there are something like
30 to 40 aides for every single member of
the House and the Senate.
And very often in one of
these committee rooms there will be
almost nothing but aides around.
When I've sat in the bear pit over here,
where the witnesses sit to testify,
I've sometimes thought that maybe the
whole thing was a show being conducted by
and for the aides with an occasional
member of the House or senator dropping by
to see what the show is all about.
This is a room in which hearings were held
on the most recent increase in the
minimum wage, for example.
Who do you suppose testified here in
favor of a higher minimum wage rate?
Do you suppose it was representatives of
the poor people who are supposedly
being helped by the bill?
Not a bit of it.
The major people testifying for it were
representatives of the American Federation
of Labor, the AFL-CIO,
the major organization
of trade unions in this country.
There's hardly a member of one of their
trade unions who works for a wage
anywhere close to the minimum wage.
Despite all the rhetoric about helping the
poor, they were in favor of a higher
minimum wage for a very different reason:
because it would protect the members of
their unions from competition from
the lower and lesser-skilled people.
To see the effects of minimum wage laws in
action, go to a place like this where they
sell quick and inexpensive food.
You don't need much training to
start work on this job.
It used to be a traditional training
ground for the unskilled.
Not any longer, thanks to the
minimum wage laws.
LEE ROBERTS: From the workerâs point of
view, the people that it was supposed to
help are the people in some cases it's
hurting the most, such as minorities,
unskilled labor and young people.
A businessman, especially a small
businessman, cannot afford to bring in
these people at the higher wage.
They are willing, however, to take
apprentices and to train them.
It's very difficult to do now
under the minimum wage laws.
FRIEDMAN: The people who are
discriminated against most by high
minimum wage rate are the people with
low skills, which includes a disproportionate
number of Negroes.
Indeed, I have long believed that the
minimum wage rate was the most anti-Negro
piece of legislation on our statute books,
not by intention, but through its results.
The more they get paid, the better people
can live, whether they are paid
in cash or in kind.
The staff restaurant in the Department
of Housing and Urban Development
in Washington, D.C.
These people are eating subsidized food.
Like all civil servants federal workers get
extremely generous fringe benefits.
They have also had an incredible
degree of security.
It has been almost impossible
to fire a civil servant.
In January, 1975, a typist in the
Environmental Protection Agency was so
consistently late for work, that her
supervisors demanded she be fired.
It took 19 months to do it and this incredible
21-foot-long chart lists the steps that had to
be gone through to satisfy all the rules and
all the management and union agreements.
UNNAMED INDIVIDUAL: This is really a
typical horror story is what it amounts to.
It shows the number of steps
youâve got to go through.
FRIEDMAN: The process involved the girl's
supervisor, his deputy director, his director,
his director of personnel operations, the
agency's branch chief, an employee relations
specialist, a second employee relations
specialist, a special office of investigations,
and the director of the
office of investigations.
This veritable telephone directory, need I
add, was paid with taxpayersâ money.
Who could invent a better-protected job than
this one before it came to its end?
WORKER: We now have a time certain
at which the decision has to be
made within the agency.
FRIEDMAN: Half an hour's drive out of
Washington you come to Montgomery
County, where many very senior
civil servants live.
It has the highest average family income
of any county in the United States.
Of the people who live here who are
employed, one out of every four works
for the federal government.
Like all civil servants, they have job security,
salaries linked to the cost of living, a fine
retirement plan also linked to the cost of
living, and many manage to qualify for Social
Security as well, becoming double-dippers.
Many of their neighbors are also here
because of the federal government:
congressmen, lobbyists, top executives of
corporations with government contracts.
As government expands,
so does this neighborhood.
Government protects its workers just as
trade unions protect their members.
But both do it at someone else's expense.
It doesn't have to be that way.
Dick Pashley is an electronics engineer.
He designs memory systems for computers.
He works for Intel Corporation, one of many
companies which have sprung up
south of San Francisco at a place
that they call Silicon Valley.
DICK PASHLEY: All these companies
have one thing in common.
They are trying to get engineers to
work on their projects.
Now, myself, I'm one of these engineers and
so obviously I get letters in the mail,
phone calls, the like, where people are
trying to get me to leave Intel and go
to this particular company.
One of the companies right across the street
here, Intercel, is one of the new
companies that's forming in this area,
and they are hunting for people
just like myself to come in.
And what they do is they'll offer you like
typically a like a 30% higher salary, stock
options, a bonus and several other things
to get you to move to their company.
Since it's not really a move,
it's very easy to do because you're
only going across the street.
It's not a big traumatic thing where you are
leaving, let's say, one city and
moving to another city.
It's very straightforward.
FRIEDMAN: In the free labor market
everybody benefits.
When the market is restricted,
things are very different.
Those Mexicans are heading for the
United States side of the border.
There are real problems about permitting
unrestricted immigration into a welfare state.
It's one thing when people come for jobs
and are on their own as was the case
for most of American history.
It's another thing when a welfare system will
support them come what may at the
expense of other people.
Yet look what happens when you try
to interfere with market forces.
WORKER: Well there's several fairly large
groups of aliens on the hillsides waiting for
dark to set in, other groups that are still
on the Mexican side of their border.
They'll be coming in shortly I imagine.
We have electronic sensors buried in along
the hillsides along the most traveled trails to
alert us when there's alien crossings.
And from the sensor we work ahead of them,
try to head them off.
(helicopter engine and radio transmittion)
(police siren)
(engines and sirens)
FRIEDMAN: This is not a case of good
guys against bad guys.
The officers are simply trying to
do their duty.
The poor Mexicans are driven by hunger
and attracted by the prospect of jobs.
WORKER: You do good work.
The law enforcing people
have an impossible job.
(helicopter engine and radio)
OFFICER: They're gonna run,
they're gonna get picked up- sent back,
but sooner or later theyâre going to make it,
one minute after the next, you know?
FRIEDMAN: In one month,
in 1978- 60,000 illegal immigrants
were arrested on this stretch
of the border.
But believe it or not,
the Border Patrol estimated that
nearly 200,000 found their way
through to places like this in
Northern California, where there
was work waiting for them.
Illegal Mexican immigrants are
not cheap labor around here.
Many earn more than the
minimum wage law demands.
They can do so because farmers
need many extra hands during
the harvest season, and there is
a shortage of domestic labor
available. Jill Hammond and her
partner run a farm
that produces plump
California raisins.
JILL HAMMOND: There's pending
legislation which would make it
illegal for farmers to hire
undocumented workers. And
supposedly- it would impose a
$1,000 fine per worker
on the farm. I can't imagine that
it would actually go through.
If it did, there'd be a full-scale
farmers' revolt around here.
Matter of fact, last year
there was quite a bit of activity
in the Kerman area, which is
about 15 miles west of Fresno.
Many of the farmers banded together,
and as much as warned the
Border Patrol to stay off their property.
And they were willing to back that up
with guns, I'm afraid. They were
very upset about it, and...
because their situation was desperate.
They needed the workers,
and they needed the work
to be done now. And the
Border Patrol was interfering with
that, as they saw it.
FRIEDMAN: Violence by employers
to assure the availability of workers
is no more justifiable than violence by
trade unions, to assure their members jobs.
But violence is one of the things
you are very likely to get
when you try to prevent a deal between
people who have jobs to offer, and
people who are looking for jobs.
Fifteen years ago, the economy of
Spartanburg, S.C. was stagnant.
It depended on peaches and cotton.
Wages were lower than the national
average, and unemployment was
higher than the average.
(factory noises)
Then, dramatically, the picture changed.
The people in Spartanburg decided
to make their town a center
of free trade. They did this by using
a new Right to Work law,
eliminating many restrictions on labor.
The City Council cut taxes to the bone.
They advertised the fact- that Spartanburg
was a place worth investing in.
By any standards, let alone Spartanburg's,
the result was revolutionary.
Industrialists came from Germany,
Switzerland, and all over the world
to build factories, to set up plants.
The workers of Spartanburg clearly
benefited from the new industries.
The first to notice were the
people who owned and ran
the traditional industries.
M. L. CATES: In terms of the business,
it has been a problem for us.
It means that we've got to be
on our toes, we've got to be
sure we're providing a good
work place, that we are providing
good jobs and what have you,
and that we are running
as competitively as possible.
I think that from the workers'
point of view, this has certainly
provided them with more
opportunities to, for a market
for their product, their labor,
their expertise.
FRIEDMAN: Suddenly, in a free market,
workers who once could not
find jobs- were now at a premium.
Everyone benefited, workers and employers
alike, and the town thrived.
(car engine)
One of the workers who arrived
in Spartanburg was Mr. Juma.
He came as a refugee
from Idi Aminâs Uganda.
MR. JUMA: We came in
this country just with $139.
I had a family, my wife
and two kids. And, we came
with only four bags of clothing,
which weighs about 40 pounds
each bag. We were not allowed
to take more than that.
We had to leave all our possessions,
all our property in Uganda.
And myself, I just came down
to Flowers Baking Company, and
I was hired as a laborer to work
in the plant at $2.49 per hour.
FRIEDMAN: Five years later, he was
chief accountant of the company.
In a free market his best protection,
his real wealth, turned out to be
his skills, and his desire to use them.
America has to offer me a lot of things.
And this is a great country.
I came in this country penniless,
today I own a house,
I own three cars, my wife has
got a good job, I myself have
got a good job, and the children
are schooling, and everything
has been working so fine.
I believe this because of the opportunity.
This is where everyone wants to work
in this country. There is lot of opportunity.
(factory sounds)
FRIEDMAN: When unions get
higher wages for their members by
restricting entry into an occupation,
those higher wages are at the expense
of other workers who find their
opportunities reduced. When government
pays its employees higher wages,
those higher wages are at
the expense of the taxpayer.
But when workers get higher wages
and more civilized working conditions
through the free market, when they
get them by firms competing with
one another for the best workers,
by workers competing with one another
for the best jobs- those higher wages
are at nobody's expense.
They can only come from
higher productivity, greater capital
investment, more widely-diffused skills.
The whole pie is bigger.
There is more for the worker,
but there's also more for the employer,
the investor, the consumer and
even the taxpayer.
That's the way a free market system
distributes the fruits of economic progress
among all the people. That's the essence
of the age of the worker.
(closing music)
ROBERT McKENZIE: The discussion is
already underway, here at the
University of Chicago, so let's join it.
Well, we tried a free market
system without labor unions.
We tried it back in the 1920s,
and into the '30s, and it led the world
into the biggest economic disaster
it's ever seen in modern times.
Now, I don't think that we're talking
talking free market or labor unions.
We're talking free market- with
or without labor unions.
And a free market system
without labor unions
is a total disaster.
McKENZIE: Let's get other reactions
to this, now, around the group.
Itâs the free market system,
Milton's Friedman's been arguing,
I think, not labor unions,
which best protect the interests or
serve the interests of the worker?
Walter Williams, your reaction.
WALTER WILLIAMS: Well, I think clearly
labor unions serve the best interests of
workers- who happen to be members of
labor unions- at the expense of workers
who are excluded from being
members of labor unions.
McKENZIE: Ernest Green?
ERNEST GREEN: I don't think you can have
a democratic society without having
trade unions. I think if you look
at any democratic country,
it's essential to it, right of workers
to organize, and I think it's consistent.
If we are to maintain a democratic
country, those freedoms that-
the right of workers to organize
is a primary objective that
we have to maintain.
McKENZIE: Bill Brady?
WILLIAM (BILL) BRADY: Well, if they are
so vital, why are so many union
members leaving the union?
Why are they, why are they
losing so many -- why are the unions losing
so many decertification elections?
Why has the number of union members
declined so precipitously- from 23 percent
of the general labor force to...what is it
now...less than 19, 18 percent?
LYNN WILLIAMS: All depends
whose figures you're reading.
But workers aren't leaving the
labor movement in droves.
The union is not declining precipitously.
My union, the
United Steel Workers of America,
the major unions in the country,
many small ones are out organizing
and growing. The mix of work --
the mix of work in the society
is changing. We have some employers,
as we saw in the film...
who can't wait to rush off to the south
and try to get in an antiunion
environment, and invest their money
in prosperity in the south- instead of
in the north, and surely if you
invest money anywhere...you're
going to have prosperity.
McKENZIE: Let me just -
So, we also have a mix in terms
of civil service and service workers,
where we have employers who
have grumbled on that film
LYNN W: about $2.90 minimum wage. BRADY: I don't know that if you
BRADY: I don't know that if you
invest money anywhere that
you're going to have prosperity.
I don't think that that's a given.
That is, you seem to me to be
dealing in a premise there
that is incorrect.
(Several people talking at once.)
McKENZIE: Wait a minute now...
wait a minute.
The key question we're discussing is:
Who protects the worker?
Is it the labor union or
the free market that
best serves his interest?
W. WILLIAMS: Well, it seems
like from the evidence that I have...
from a number of research projects
that I've engaged in, Iâve found
that labor unions protect their members,
often at the expense of
disadvantaged people.
And it's a very, very interesting
question that the labor unions,
down through the ages, have
discriminated against all kinds of
W. WILLIAMS: people- in favor of a L. WILLIAMS: We haven't, Walter...
W. WILLIAMS: particular class of workers. L. WILLIAMS: ...we haven't.
W. WILLIAMS: We find that labor unions
have gone out on strikes, and
have murdered and maimed people
because other people sought entry,
and in terms of Mr. Green's remark,
he says that in the free democratic
society, we need labor unions.
Yes, that is true, we need
the right for voluntary association,
that is, free people have the right
to form associations, but it should not
be a requirement that you be a
member of a labor union
in order to establish a
contract for employment.
L. WILLIAMS: Can't we get some --
can't we get some perspective
in this, Walter? Talking about unions
down through the ages makes no
sense at all in terms of where
we're at now in this century
at this time. This business of
trying to relate where unions
come from to the, to the medical
profession and Hippocratic oaths,
Hippocratic Oaths or hypocritical oaths,
however one looks at that,
back in the Greek islands
really have very little relevancy.
W. WILLIAMS: Yes it does.
L. WILLIAMS: The violence,
see hear me out a minute,
I waited patiently.
W. WILLIAMS: Okay, okay.
L. WILLIAMS: The violence it's associated
with -- well, not so patiently,
but I waited. The violence
associated with the labor movement
and so on have been minimal
and was a reaction,
in this century,
not over the ages,
a reaction in this century to
the violence done workers
by corporations and powerful
economic groups when there
was no workers' organization
to protect them and no way
to deal with their greed
and with their power â
McKENZIE: Okay. Now,
now I'm turning to Milton
because he's heard the flavor
of the discussion.
FRIEDMAN: Sure.
What Lynn Williams is now
saying is utter nonsense.
There's no other --
no two ways about it.
The conditions of the worker
in this country before there was
labor unions were very important --
improved very greatly.
You cannot tell me
the millions of people,
my parents, your parents,
for all I know,
parents of many people around,
came to this country
from Europe in order to be
exploited and in order
to be subjected to violence.
Of course, there were
incidents of violence.
GREEN: I disagree with that vehemently.
I mean most of the blacks
came to this country not voluntarily,
but they were shipped here.
FRIEDMAN: The blacks -
GREEN: And the interesting
thing about the issue on --
on Spartanburg though -
FRIEDMAN: The blacks did not
-- excuse me, hold on for a second.
GREEN: Is that you left out -
FRIEDMAN: Hold on.
MCKENZIE: Let him finish
and then back to you.
GREEN: All right.
FRIEDMAN: The blacks are
an exception and I agree
with you completely.
GREEN: Twenty-two million
exceptions, though.
FRIEDMAN: But they are a
very important exceptions.
But there are also millions
and millions - the people that
Mr. Williams represents are
not mostly black. They are
mostly from the Slavic countries,
came from Eastern Europe.
L. WILLIAMS: If you look at the
membership of the Steel Workers â
FRIEDMAN: If we -- if we go back,
of course, there always has been violence.
It's not excusable,
I'm not excusing violence
on the part of anybody,
but I agree with Mr. Green
and with Walter Williams
that people should be free to organize.
of course they should be free to organize.
What I object to is the special privileges
that have been given by government to
labor unions which are not available
to other groups at all.
When labor unions have used violence
in industrial disputes they are not
subjected to the same sanctions
as people ordinarily are.
When cars are turned over in the course
of a labor dispute, how often do
people go to jail as a result of it?
L. WILLIAMS: Dr. Friedman and Walter
Williams go back in history
and they take a look at a situation where
America was empty, where we didn't have
anything like the sophisticated industrial
economy we have today,
but had a much more agricultural
and rural kind of economy and of course
when the -- when the impoverished
peasants of Europe, my ancestors
and most of our ancestors,
except for the slaves, which is
another situation, but when these
people came from Europe and came to
a wide open continent with the most
fertile soil then available to
anyone in the world,
naturally there was progress
and I or any of us would be
mad to deny progress.
But as that developed and as population
increased and as we moved into a
much more sophisticated industrial economy,
we moved then into the situation
in the 1930s, or earlier than that,
at the end of the century, as some
of the more skilled jobs came along.
The labor movement didn't happen
by accident, didn't happen because
there wasn't a need there.
The results of this development, even
with all the wealth available in America,
the results of this development was that
many working people were not having
anything like, by standards of civilization
or whatever, anything like
their fair share in this progress.
McKENZIE: Now you're arguing
that in a free market,
for labor, everyone benefits.
Does that mean that you would favor
abolition of all immigration restrictions?
FRIEDMAN: The situation of immigration
restrictions really has to do with
the question of a welfare state.
As I say in the film,
I would favor completely free immigration
in a society
which does not have a welfare system.
With a welfare system of
the kind we have,
you have the problem that people
immigrate in order to get welfare,
not in order to get employment.
You know it's a very interesting thing,
if you had asked anybody --before 1914
the U.S. had no immigration
restrictions whatsoever,
I'm exaggerating a little bit,
there were some immigration restrictions on
Orientals, but it was essentially, mainly free.
If you ask anybody,
any American economic historian,
was that a good thing for America?
Everybody will say yes
it was a wonderful thing for America
that we had free immigration.
If you ask anybody today,
should we have free immigration today?
Everybody will...
almost everybody will say no.
What's the difference?
I think there's only one difference,
and that is that
when we had free immigration
it was immigration of jobs
in which everybody benefited.
The people who were already here
benefited because they got
complementary workers,
workers who could work with them,
make their productivity better,
enable them to develop
and use the resources of the country better.
But today, if you have a system
under which you have essentially a
governmental guarantee
of relief in case of distress,
you have a very, very real problem.
McKENZIE: But this is true of
every western industrialized country.
and that's why today -
you cannot, unfortunately,
have free immigration.
Not because there's anything wrong
with free immigration,
but because we have other policies
which make it impossible
to adopt free immigration.
McKENZIE: Well I'd like
other reactions.
Is it at all feasible to open
the door of the labor market
internationally now? Bill Brady?
BRADY: I would --
I would say yes,
providing they open the door to us.
I think that the door to
not only the labor market,
the door to all markets should be
-- should be open.
That is the product markets.
W. WILLIAMS: My feelings
about the undocumented workers
of Mexican-Americans are inscribed
at the foot of the Statue of Liberty.
I think that the people should have the right
to come to this country.
Now, those who would say, you know,
I hear a number of people saying that,
well the immigrants
are contributing to our
unemployment problem.
And I pointed this out to some people,
I said, "Look, you know,
this is the same rhetoric that the Irish used
when the blacks
were coming up from the north,"
you know,
they're using blacks as scapegoats.
They're saying, "Get those people back
where they came from so that our
members can get jobs," you know.
Unions were as well doing this, you know,
they called them scabs,
strikebreakers, etcetera, etcetera.
So I do not wish for Mexican-Americans
to become the new scapegoats of our
particular national problems.
They are not the problem, and our nation
benefits to the extent
that these people come here and work.
And to that extent -- to that extent
so it's kind of good for them to remain illegal
aliens as opposed to being legal aliens
where they're subject
our welfare programs,
so that we don't want them to come here to -
(Several people talking at once.)
GREEN: I think that this country cannot
have a group of workers to remain outside
the framework of our laws
and our protections.
And as long as we have workers who are
attracted to the United States
because of the standards of living;
and I think minimum wages play
a part in that as part of that attraction.
But it seems to me
to have undocumented workers
without providing
either a means of protection for them,
and it seems to me that we've got to go
to the question of providing
the amnesty for those generations
of workers who have come here
over a period of time,
now two, three, maybe four generations.
We have to see that they have the same
rights and protection of all other workers.
And as it stands now, large numbers
of them live outside the framework
of the laws and statutes
that we have on the -- on our books.
McKENZIE: Comment Milton.
FRIEDMAN: They do and
the tragedy of the situation,
as Walter Williams points out,
that as long as they are undocumented
and illegal they are a clear net gain,
the nation benefits and they benefit.
They wouldn't be here if they didn't.
The tragedy is that we've adopted
all these other policies so that if we
convert them into legal residents
it's no longer clear that we benefit.
They may benefit,
but it's no longer clear that we do.
What Lynn Williams said before is again
a travesty on what was actually going on.
The real boost to the trade union movement
came after the Great Depression
of the 1930s.
That Great Depression was not a failure of
capitalism, it was not a failure of the private
market system as we pointed out in another
one of the programs in this series;
it was a failure of government.
It was not the case that somehow or other
there was a decline in the conditions
of the working class that produced
a great surge of unionism.
On the contrary -- unions have never
accounted for more than one out of four
or one out of five of American workers.
The American worker benefited
not out of unions,
he benefited in spite of unions.
He benefited because there was greater
opportunity because there were people
who were willing to invest their money
because there was an opportunity
for people to work, to save, to invest.
That's still the case today.
You say, we have to provide them with
something or other Ernest.
Who are the âwe?â
GREEN: We the people.
(Laughter)
FRIEDMAN: How do, âwe the peopleâ
-- but how do âwe the peopleâ do it?
GREEN: And it seems -- we the people
provide them the protection by
seeing that their safety -
McKENZIE: You're talking
about the immigration population now.
GREEN: -- and occupational
health codes that protects the environment
that they work in, see that
they have civil rights laws that protect
their own person, see that they have
civil liberties laws that protect them further.
We the people of this
country provide that protection.
W. WILLIAMS: Why are they
coming here it's so bad?
If they don't have, you know,
you're kind of painting an image, you know.
Why are these people coming?
We're not pulling them here by chains.
(Several talking at once.)
McKENZIE: Gentlemen, don't all talk at once.
Lynn, and then -
W. WILLIAMS: So what are
you talking about protecting them?
GREEN: Why did you leave Little Rock,
Arkansas to go to Philadelphia?
It seems to point-
L. WILLIAMS: It seems to me that it's obvious â
W. WILLIAMS: Would you
extend the courtesy to finish.
Look, look, first thing, look,
let me say the following thing:
There's some basic things
that we need to know.
L. WILLIAMS: Well now, are you going to say
the thing I was interrupting or are you
gonna say five more things?
I mean there isn't all afternoon.
W. WILLIAMS: You know, labor unions,
and minimum wages for that case,
cannot improve the condition of
the working people of the country.
L. WILLIAMS: We do it everyday.
W. WILLIAMS: Because if
-- are you suggesting â
L. WILLIAMS: We improve the working
conditions of working people in countries
all around the world, everyday.
W. WILLIAMS: Well you know this --
you know what you're telling the audience,
you're saying that you can solve
the problems in Bangladesh.
You can make them a rich
country if you tell them to
unionize like we are â
L. WILLIAMS: I didn't say that.
W. WILLIAMS: --and demand high wages.
L. WILLIAMS: No, I didn't say
anything remotely like that.
W. WILLIAMS: It's productivity
that keeps income low.
McKENZIE: Lynn, let him finish.
BRADY: I come back to my initial question:
why are so many leaving the union?
L. WILLIAMS: There aren't
very many leaving the union.
BRADY: Oh, there are too.
I've given you the statistics.
L. WILLIAMS: Ah, now, do you think
I'm -- you grind off some percentages.
I live in the labor movement.
BRADY: You -- do you have other
percentages?
FRIEDMAN: In or on?
L. WILLIAMS: In, with and on.
And of course they pay me, of course, and
I don't have any objection to that at all.
FRIEDMAN: Neither do I.
L. WILLIAMS: At least we got
you a few minutes ago --
we got you to get the labor
movement up into this century.
And I agree with the observation you made -
(Laughter)
L. WILLIAMS: I agree with the observation
you made, that the industrial
union movement...
that there was a union movement
came out of the dirty '30s
and out of the depression and grew,
and that that was essentially
an industrial union movement.
But I wonder if --
I wonder when I hear your commentary
on the film and so on about unions
and restricting practices and restricting
access to industry and all of this,
I really -- I don't mean it disrespectfully,
but I really wonder â
FRIEDMAN: Don't mind being disrespectful,
it's all right. I'm used to it.
L. WILLIAMS: I really wonder if you,
if you do understand how the industrial
union movement, which is --
the more recent part of the movement,
how it really operates.
We're not telling anybody
who they have to hire.
FRIEDMAN: (Laughing)
McKENZIE: Let's raise the question,
which certainly is dealt with in the film:
Have minimum wages --
which is a form of government
intervention -- served the interests
of the poor and indeed of
the working class generally?
Now, I know you've spent
a good deal of time looking at this -
W. WILLIAMS: Yes. Okay, well,
at least form the standpoint of teenagers,
particularly minority teenagers,
the minimum wage law has acted to
destroy a number
of employment opportunities.
For example, back in 1948,
the black youth between 16
and 18 had an unemployment
rate of 9.4 percent and white youth was
10.4 percent, or 10.2 percent.
The labor force participation rates of
blacks was considerably
higher than that of whites.
And with each increase in the minimum
wage law, we had the dramatic
reversal that we have now.
And so the minimum wage law
has the effects of saying that
if you cannot produce $2.90
worth of goods an hour,
you don't deserve a job.
GREEN: I don't think -- you
can't look just at the minimum wages -
W. WILLIAMS: But â
GREEN: -- you've got to look
at the relocation of firms.
You've got to -- you've got to
look at the movement of people.
You've -- I mean you can't --
you can't do that.
W. WILLIAMS: Well, can't we just
-- well you look at the relocation of firms.
A lot of people try to say a lot of jobs
move out to the suburbs.
Well, you find black-white
unemployment ratios the
same in the suburbs as you
find in the cities. So it's --
mean, it's the minimum wages.
L. WILLIAMS: Yes, but taking one element
-- you're taking one element
out of a long historic development
and you start comparing 1920 â
GREEN: Even if you hold constant
-- if you hold constant -
(Several people talking at once.)
McKENZIE: Lynn is next,
Lynn and then Ernest Green.
Come on now.
GREEN: I understand the law
of educational achievement.
McKENZIE: Lynn and then Ernest Green.
GREEN: You get a differential
between black and white
unemployment rates -
McKENZIE: I'll bang the gavel...
...Come on. Lynn.
L. WILLIAMS: Well you're
taking -- you're taking one element,
years ago in a situation that's entirely
different that we're in today
and drawing some conclusions-
W. WILLIAMS: Minimum wage.
That's what's different.
L. WILLIAMS: No, no. There are many
other things that are different.
The enormous movement of black
people in this country between 1948
and now. You can't just wipe that out.
And you can't say that's â
W. WILLIAMS: White people move, too.
L. WILLIAMS: -- you certainly can't say
that's the minimum wage. But you know â
McKENZIE: Wait now. I want this case made.
Has the minimum wage served the interests
of the working people in this country?
L. WILLIAMS: I don't think there's
any question -- I don't think there's any
question that the working people
of this country would be much worse
off than they are today,
the youth of this country would be much
worse off than they are today
if we didn't have minimum wage.
McKENZIE: All right, now,
Brady. You -- come on.
BRADY: No, it's I â
McKENZIE: On minimum wages --
good idea or not? You're an industrialist.
BRADY: No. It's a bad idea.
It is patently one of the,
one of the worst things that can --
that we can do to our youth.
We prevent them from â
GREEN: Bill, how many kids
do you have?
BRADY: -- we prevent --what's that?
GREEN: How many kids do you have?
BRADY: I have two.
W. WILLIAMS: It's not
important how many kids you have.
GREEN: But it is. Minimum wage
doesn't affect his industry.
His wages are far above the minimum wage.
FRIEDMAN: Minimum wage doesn't
affect a single one of his members.
(Several people talking at once.)
McKENZIE: Hold it. Hold it. Hold it.
Milton has the floor.
L. WILLIAMS: We have not gone to support
minimum wage legislation in this country-
McKENZIE: Gentlemen, hold it a moment.
McKENZIE: Hold it a moment.
(Several people talking at once.)
McKENZIE: Hold it a moment now. Milton -.
L.WILLIAMS: Of course we have not.
We are a people's organization â
McKENZIE: Lynn -- the Chairman
has said the floor is Milton's.
FRIEDMAN: I was saying that there
is not a single one, I suspect,
of the members of your union
who is affected by the minimum wage.
They are much higher.
FRIEDMAN: You say that you
are a public service organization.
L. WILLIAMS: I say we're a
people's organization.
FRIEDMAN: You're an organization
of your workers.
And if you aren't representing
the interests of your workers
they ought to fire you.
L. WILLIAMS: And we're out â
FRIEDMAN: If you tell us that
you are going against the interests
of your workers you are simultaneously
saying to your workers --
I'm not doing what you hired me for.
L. WILLIAMS: Oh, come on.
This is, this is pure sophistry. I'm not â
FRIEDMAN: It's not sophistry in the slightest.
L. WILLIAMS: -- I am not talking â
FRIEDMAN: I'm just trying to -
L. WILLIAMS: I am not talking about
representing the interests of our workers.
Our union represents a lot of people.
FRIEDMAN: Right. Right. It does.
L. WILLIAMS: And some of the people
are the ones that you're probably aware of,
people who work in big steel mills â
FRIEDMAN: That's right.
L. WILLIAMS: -- and all the rest of that.
FRIEDMAN: Absolutely.
L. WILLIAMS: But we also go
out and organize workers all
the time and win certification
votes despite Bill Brady's comment
about that.
And many of the workers
we organize are workers who are
affected by minimum wage. And the result
of our organizing them is that we're able
to bring them above the minimum wage.
McKENZIE: Yes.
W. WILLIAMS: The point is, is that,
I think that both these gentlemen,
we all should recognize,
is that unions in the United States
support the minimum wage.
They are the major supporters.
They spend millions and millions
of dollars in lobbying for the
minimum wage law.
They do it out of the name of concern
and being in the interest of people.
Now, in South Africa the unions
are far more honest.
That is those white racist unions over there;
they say we support minimum wages
and equal pay for equal work
so as to protect white jobs.
That is to protect white jobs-
L. WILLIAMS: Are you implying â
W. WILLIAMS: -- from low-price competition.
L. WILLIAMS: Are you now implying,
wait, that we're white racists?
W. WILLIAMS: No, I'm not saying that.
I'm saying that it doesn't make
any difference about the intent.
GREEN: Walter, the Urban League supports
minimum wage the -- Ben Hooks
at NAACP supports minimum wage.
McKENZIE: The floor belongs to Ernest.
W. WILLIAMS: They have very good
reasons to support minimum wage.
GREEN: Why?
W. WILLIAMS: Their group that they
represent â
GREEN: Why â
W. WILLIAMS: They represent
middle class whites.
GREEN: No, no, no.
W. WILLIAMS: They don't represent
the poor blacks on the streets.
GREEN: The membership of the
NAACP probably has as many â
W. WILLIAMS: And they're owned by them.
They're owned by the AFL-CIO.
L. WILLIAMS: They aren't
owned by the AFL-CIO.
McKENZIE: Order. Order.
L. WILLIAMS: That is a conservative's view
McKENZIE: Order. Order.
L. WILLIAMS: That is a conservative's view
(Several people talking at once.)
MCKENZIE: Order! I'm going to --
I'm going to -- I'm going to --
I'm going to turn to Milton now.
Are you saying, then,
that you would advocate the repeal
of minimum wage legislation?
FRIEDMAN: Of course.
McKENZIE: You would.
FRIEDMAN: Of course I would.
(Several people talking at once.)
McKENZIE: Bill Brady, Bill Brady.
BRADY: I should like to ask Ernest
and Lynn why they want to restrict
a minimum price to labor.
Why don't you let me have a minimum price
on the products that we manufacture?
L. WILLIAMS: Well we aren't here,
as I understand it,
to discuss your problems at
the moment in terms of the owners â
BRADY: Is there a difference?
Why a minimum amount of profit --
L. WILLIAMS: Well, you're the people
I assume who are so anxious to
have the free market system and to
compete with each other and all
the rest of it,
we're talking about the needs of the
workers and, we're talking about the needs
of the people who come into a society
which isn't providing enough employment
for them, which clearly doesn't
seem to be able to provide
enough employment for them,
and what are we going to do?
And I think this notion that somehow
if we just let every guy who is running
a hamburger stand or whatever,
we just let all these people exploit the
young people of this nation in any way
they chose, pay them any little rate
they could get away with,
that everybody would then go
to work, would everybody
then have a job, is absolute nonsense.
McKENZIE: I want to bring Milton
to one of the final stages of his film,
which is Spartanburg, South Carolina.
FRIEDMAN: Sure.
McKENZIE: And I want to know what your
what conclusion you're drawing from that.
Would you, in effect,
like to see the whole of the United States
become, as it were,
Spartanburg writ large?
FRIEDMAN: Absolutely.
McKENZIE: Yeah. What would that mean?
And then we'll get their reaction to it.
FRIEDMAN: It would mean a widening
of the opportunity for everybody.
It would mean an opportunity for
employers all over to compete with
one another for workers.
It would mean an opportunity for
workers to find jobs which can make the
greatest use of their own skills
and their own capacities.
It would mean that consumers
would be able to get better
products at lower prices.
You know, consumers enter into
this situation, too.
You might think that somehow
or other, you know --one of the
things that's always a mystery to me,
if a $2.90 minimum wage benefits
people why wouldn't a $6 minimum
wage be better?
Wouldn't a $10 minimum wage be better?
Why don't these people come out
for a $200 figure minimum wage?
If all you had to do to make a country -
ERNEST GREEN: You're pretty smart -
FRIEDMAN: Two hundred dollars an hour.
W. WILLIAMS: Or extend it to babysitters.
FRIEDMAN: Yeah. If all you need to improve
the lot and the conditions of people
is to legislate a higher -
McKENZIE: You're back on minimum wages.
I want to know how Spartanburg -
Spartanburg improves matters because
it introduces a wider range of competition
and the real thing that protects the
worker is the existence of
alternative employers
seeking his services, just as what
protects the consumer is alternative sellers.
BRADY: Milton, you omit one thing
that it would do.
And it would result in a very
substantial increase in capital investment.
FRIEDMAN: Absolutely. It would.
BRADY: And capital is the
worker's second best friend.
FRIEDMAN: Sure.
L. WILLIAMS: This is only to say, surely â
FRIEDMAN: The reason why
everybody can benefit.
L. WILLIAMS: This is only to
say that a busy economy,
one in which there's investment
and development and so on is an economy
that's a good economy for
working people and for everyone else.
I think we say that in the AFL-CIO
at least once a month, all the time.
There's nothing in which --
there's nothing in which we're
more interested
than having a busy, functioning economy.
The question is how to bring that about.
I do suggest, and I think --
I think can be defended as long
as we want to discuss it, that the
prosperity we have in America today,
that the labor movements have made
an enormous -- the labor movement
has made an enormous contribution to that,
and in the absence of the labor movement
and in the absence of minimum wage
this would not be as prosperous
a country as it is.
That is not to say that itâs perfect.
McKENZIE: Now hold it there
-- hold it there, Lynn.
I want to get a reaction to that.
He stated the case for what
unions have achieved.
Could we go around, first of all,
do you accept any part of that?
W. WILLIAMS: No, it's preposterous,
you know, as I suggested before.
I mean, if we, you know,
if minimum wages could make people richer
McKENZIE: Unions we're talking about now.
W. WILLIAMS: Well, if unions
could make people richer -
McKENZIE: Yeah.
W. WILLIAMS: -- all you have to do
is tell people in Bangladesh,
Why don't you unionize and demand a
higher wage? You could be
rich like the United States.â
L. WILLIAMS: We're telling
everyone in the world.
W. WILLIAMS: It's productivity.
L. WILLIAMS: We told them in
Japan it works.
McKENZIE: Lynn -W.
W. WILLIAMS: The workers have higher
wages in our country because
they're more productive.
That's how you get higher wages.
And this just plain
-- I mean, it's nonsense.
BRADY: And why
are they more productive?
W. WILLIAMS: Because they have capital
BRADY: Enormous capital investment.
(Several people talking at once.)
BRADY: And the highest wages
are paid and in the higher
the capital-intensive industries.
L. WILLIAMS: And because there are
consumers to buy the stuff who
have wages which enable them
to go into the marketplace
and buy something.
BRADY: Without the capital investment
they wouldn't have the wage and it
would be no way of paying them
without the capital investment.
L. WILLIAMS: If all those workers
weren't making any money there
wouldn't be much prosperity
BRADY: There would be no way of
paying it without the capital investment.
McKENZIE: Ernest Green,
what's the reply, your reply?
GREEN: I stand by my initial statement,
that it is a prerequisite of the
democratic society to have trade unions,
organizations aligned, workers to band
together in their mutual interests, and -
W. WILLIAMS: Are you
saying voluntary associations?
GREEN: And if that, if that group --
I'm saying that trade unions like
A. Philip Randolph's sleeping car porters,
the Pullman car company would
have never, on its own, given those workers,
who worked very hard and were very
productive people, well educated,
any increase in their wages had it
not been for the intervention of Randolph.
FRIEDMAN: The crucial issue is whether
governmental measures which have
the effect of favoring union organization,
of giving them privileges and immunities
that are not accorded to other organizations
in the society, benefit the society
as a whole,
or harm the society as a whole.
The proposition I tried to make in this film
was that the source of the prosperity
of this country was freedom of enterprise,
freedom of employers to hire,
of workers to work for whom they
wanted to; and insofar as unions have
played a role, they have protected
some workers at the expense of others,
and have retarded the prosperity
of this country. I think that Lynn Williams'
statements to the contrary
cannot be supported
by any empirical or other evidence,
that he has, understandably
I'm not blaming him for this,
he would be faithless to his job
if he did not believe sincerely
in what he's saying. I'm not questioning his
sincerity, but sincerity is a
much overrated virtue in our society.
The plain fact is that there is no
evidence whatsoever that either unions
or minimum wages have made positive
contributions to the
prosperity of this country.
Some unions have, of course;
some unions have done great harm.
It's not an open and shut picture in
which you can make a sweeping statement.
But on the whole,
the growth of this country -
ERNEST GREEN: I'd like
for you to make a sweeping statement.
FRIEDMAN: I do. The sweeping statement
I make is that the prosperity
of this country derives primarily
from freedom of enterprise and freedom
to hire, to employ, to work,
and not from restrictive
measures imposed by trade unions.
McKENZIE: Everybody briefly now. Ernest
GREEN: And I would say that
the intervention
of a strong federal government,
who those employers hire,
the kinds of protection,
the wage standards, health conditions,
are the requirement of this government
to protect its people. Because the history
of it has shown that that hasn't occurred,
and in your case in Spartanburg,
South Carolina, again,
I argue that the only reason that they can
come back now and attract firms
from Switzerland
and Germany is because,
one that we had a strong government
that provided protection for all
of its citizens which
didn't occur fifteen years ago.
McKENZIE: Bill Brady.
BRADY: Economic freedom, in my opinion,
should not be abridged.
I think that these two gentlemen are
advocating that it be abridged.
They're advocating a retention
of the minimum wage.
They're advocating, I think,
Lynn Williams is advocating the
retention of the Davis-Bacon Act.
They do not, it seems to me,
believe that freedoms are
interdependent and indivisible.
There are freedoms --
there is economic freedom;
there is press freedom;
there is freedom of assembly;
there's religious freedom.
And you are advocating to me
a great abridgement of economic freedom,
and when you do that you injure the
other freedoms that we have.
And if you do it enough, as we are doing
in this country today, if you do it enough
we are in danger
of losing all of our other freedoms.
McKENZIE: Now we leave this
very spirited discussion,
and I hope you'll join us again
for the next episode of
Free To Choose.
(closing music)
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