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Free To Choose 1980 - Vol. 08 Who Protects the Worker? - Full Video — Transcript

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0:01Hello, I'm Robert McKenzie, and welcome
0:03again to the fine old Harper Library
0:05in the University of Chicago.
0:07A group of guests have come together
0:08to see and to discuss the latest film by
0:11Milton Friedman in his series,
0:12Free To Choose. In this, he examines
0:15the working of the labor market, and
0:16role of labor unions, and again comes up
0:19with some controversial views in answer
0:21to the question: Who protects the worker?
0:25(Opening music)
1:08MILTON FRIEDMAN: People who earn their
1:09living in a modern heavy industry seldom
1:11engage in the kind of backbreaking toil that
1:14was the everyday lot of most
1:16workers a century ago.
1:18And yet they earn far more.
1:22What has produced these improvements?
1:26The offhand reaction of most people is likely
1:29to be that labor unions are largely
1:31responsible for the enormous progress
1:33that workers have made
1:34in the past two centuries.
1:36But clearly, at least for the United States
1:38that cannot be true.
1:40After all, in the 19th century,
1:42when workers did very well,
1:44there were hardly any labor unions at all.
1:46And even today, no more than one
1:49out of four or five workers is a
1:51member of a trade union.
1:52And the remainder do very well indeed
1:55in achieving the highest level of
1:57living in the world.
1:58Labor unions do, of course, benefit their
2:01members but, far from being a key to the
2:04development of the modern society, they are
2:08a throwback to an earlier pre-industrial era,
2:11to the agreements among craftsman in the
2:14Middle Ages or, to go back even earlier,
2:16more than 2,000 years ago,
2:18to the agreement
2:20among medical men in Greece.
2:25From the tiny Greek island of Cos, the coast
2:28of Asia Minor is four miles away in the mist.
2:33Twenty-five-hundred years ago a hospital
2:35and medical school flourished on Cos.
2:37The great Hippocrates, the founder of
2:40modern medicine, worked there.
2:47Legend has it that Hippocrates taught his
2:49students in the shade of this plain tree.
2:52He welcomed anyone who wanted to learn,
2:54so long as they paid his fee.
2:56There is another legend that St. Paul stood
2:59here and preached the gospel of Christianity.
3:11What isn't legend is that Hippocrates and
3:13his followers started medicine on the road
3:16forward to becoming a science.
3:21When Hippocrates died at the age of 104,
3:24or so legend has it, this island was full of
3:28medical people, his students and disciples.
3:31Competition for custom was fierce.
3:33Some 20 years after he died they got
3:37together and constructed a code of conduct.
3:40They named it the Hippocratic Oath,
3:42after their old teacher and master.
3:46Every new physician, before he could start
3:49practice, came to this spot back here in
3:53front of those columns and took the Oath.
3:57The oath was full of fine ideals for
3:59protecting the patient.
4:01But it also had a couple of other things in it.
4:04Listen to this one, "I will impart a knowledge
4:08of the art to my own sons, and those of my
4:12teachers and to disciples bound by a
4:14stipulation and oath according to the law
4:17of medicine, but to none others."
4:21Today we'd call that a closed shop.
4:25Or listen to this one referring to patients
4:28suffering from the agonizing disease of
4:30kidney or bladder stones:
4:32"I will not cut persons laboring under the
4:36stone but will leave this to be done by
4:38men who are practitioners of this work."
4:43A nice market-sharing agreement
4:45between physicians and surgeons.
4:47Hippocrates must turn in his grave when a
4:50new class of medical men takes that oath.
4:53After all, he taught anyone,
4:55provided only they pay his tuition.
4:59He would strongly have objected to the kind
5:02of restrictive practices that physicians
5:04all over the world have adopted
5:07to protect their custom.
5:10In the United States the American Medical
5:12Association has for decades been one of the
5:15strongest labor unions in the country,
5:17keeping down the number of physicians,
5:19keeping up the costs of medical care,
5:22preventing competition by people from
5:25outside the profession with those in it; all,
5:28of course, in the name
5:30of helping the patient.
5:32(ambulance siren)
5:39(woman sobbing)
5:47Without warning, anyone of us
5:48may suddenly need medical care.
5:53If we do, we want the very best
5:55care we can get.
5:57But who can give us that care?
6:03Is it always a graduate of an expensive
6:05medical school who has a union card
6:07called a medical license?
6:10Or might it be someone like this, a trained
6:13paramedic working for a private enterprise
6:15organization rendering emergency care?
6:18PARAMEDIC: And hopefully we'll get
6:19a very good contract out of that.
6:23FRIEDMAN: Many such businesses
6:24provide primary care for emergency cases
6:27in the United States.
6:28This particular paramedic team is attached
6:30to a fire department in southern California.
6:33They're good at their job.
6:35But it's not unusual to find
6:37local physicians objecting.
6:41JOE DOLPHIN: They take the Hippocratic
6:43Oath here in the United States and they
6:46believe that they should be the one that
6:48is treating their patient; they should be
6:50the one that saves that patient's life.
6:52And if someone else does it, it just kind of
6:54interferes with everything that they
6:56have been taught.
7:08FRIEDMAN: But why should medical care
7:09be a monopoly of licensed physicians?
7:12Shouldn't anyone who is capable of providing
7:14effective help be free to do so? PARAMEDIC: I'm going to take your
7:17blood pressure here.
7:18Okay, any one see him go down?
7:23FRIEDMAN: You can be sure that no one
7:25would be able to stay in this business very
7:27long unless he can demonstrate by
7:30performance that he's doing a good job.
7:33Joe Dolphin knows that very well.
7:37DOLPHIN: We've taken some statistical
7:38samples of the kind of effectiveness
7:41paramedics have in California.
7:43Giving an example of that, in one district of
7:46California that we serve which is a county
7:47which is populated to the extent of 580,000
7:51people, before the introduction of
7:53paramedics, less than 1% of the patients
7:56that suffered a cardiac arrest or their heart
7:58stopped, lived through their hospital stay
8:01and were released from the hospital.
8:03But with the introduction of paramedics,
8:05just in the first six months of operation,
8:0723% of the people whose heart stops,
8:09are successfully resuscitated and are
8:13released from the hospital and go back
8:14to productive working society.
8:17We think that's pretty amazing.
8:20We think the facts speak for themselves.
8:22However, relating that to the medical
8:25community is sometimes very difficult.
8:27They have ideas of their own.
8:29Respiration's 12 and regular by...
8:31Looks good to me Dave.
8:33How are you reading this down there?
8:37Are you guys ready to go?
8:39Yeah. It says Code Two. Code Two?
8:42FRIEDMAN: Disputes between union
8:44and non-union workers are not
8:45always as high-minded as between
8:47organized medicine and Joe Dolphin.
8:51One day in 1978, workers at a coal loading
8:54dock on the Ohio River in southern Indiana
8:57continued to work after the Mineworker's
9:00Union had called a strike.
9:02That night, a crowd of armed
9:04union men invaded the site.
9:09JOHN PERSINGER: And then they fired on a
9:11little building sitting here after they fired on
9:13Mr. Teegarden's car here, and threw another
9:18fire bomb into the trailer.
9:21Others had run on back and were firing
9:24trucks and shooting holes through
9:27tires with handguns.
9:29I'd gone back beyond the loading dock here.
9:34Standing back in there, I could hear them
9:37shooting and the air escaping
9:38from truck tires.
9:40Course there's so many people moving
9:41around and doing so much damage and
9:44setting so many things on fire...a whole
9:46lot of things going on at one time.
9:49We should have been heavily armed
9:50and shot these people, did something
9:53to stop such destruction.
9:55I wouldn't have believed that a rabble rouser
9:58could have gathered together that many
10:01irresponsible people to come on to a
10:03person's property and do this kind of
10:05destruction until I'd finally seen it done.
10:14FRIEDMAN: These workers are on
10:15the other side of the union fence.
10:19They're building two Social Security
10:21offices in Baltimore.
10:23On this government project
10:24everyone's a union worker.
10:26They rely on their union to protect them
10:28against competition from non-union labor.
10:32But some local contractors see a very
10:34different side to a closed shop.
10:38HARRY LEEF: We don't feel that anybody
10:39should be denied a choice and we feel every
10:41man should have a choice if he wants to be
10:43unionized or not; not legislated,
10:45not saying he must belong to a union.
10:48We feel when you tell a man he must belong
10:51to a union or he must do this or that,
10:53you are taking freedoms away from this
10:55man, the freedom of choice of this
10:57businessman here to choose me,
10:58to do business with me.
11:00All business needs its right to choose
11:02to do business with each other.
11:04By the same token, our employees have
11:06the right to choose whether they
11:08want unionization or not.
11:12FRIEDMAN: On this government site,
11:13“Authorized Personnel Only” really means
11:16“Unionized Personnel Only.”
11:25Unions have long recognized that
11:27the surest and most effective way
11:29for them to get power without
11:31violence is to have the federal
11:33government on their side.
11:36That's why so many strong unions have
11:38made it a point to locate their headquarters
11:40close to the source of power.
11:46The heads of the trade unions that cluster
11:48near Capitol Hill know this place very well.
11:51It is the room assigned to the Committee on
11:54Education and Labor of the House of
11:56Representatives, and it is where much of our
11:58labor legislation is discussed and shaped
12:01before presentation to Congress.
12:04I know rooms like this myself very well,
12:07because I've often testified before
12:10congressional committees and they all meet
12:12in rooms like this.
12:13Up there on the podium is where the
12:16members of the House or of the Senate sit.
12:19Of course, behind them there will be
12:21clustered a bunch of aides.
12:23As you know, there are something like
12:2530 to 40 aides for every single member of
12:28the House and the Senate.
12:29And very often in one of
12:31these committee rooms there will be
12:33almost nothing but aides around.
12:35When I've sat in the bear pit over here,
12:37where the witnesses sit to testify,
12:40I've sometimes thought that maybe the
12:42whole thing was a show being conducted by
12:45and for the aides with an occasional
12:48member of the House or senator dropping by
12:50to see what the show is all about.
12:53This is a room in which hearings were held
12:57on the most recent increase in the
12:59minimum wage, for example.
13:03Who do you suppose testified here in
13:05favor of a higher minimum wage rate?
13:08Do you suppose it was representatives of
13:11the poor people who are supposedly
13:13being helped by the bill?
13:14Not a bit of it.
13:17The major people testifying for it were
13:20representatives of the American Federation
13:22of Labor, the AFL-CIO,
13:25the major organization
13:28of trade unions in this country.
13:30There's hardly a member of one of their
13:32trade unions who works for a wage
13:34anywhere close to the minimum wage.
13:37Despite all the rhetoric about helping the
13:39poor, they were in favor of a higher
13:42minimum wage for a very different reason:
13:44because it would protect the members of
13:47their unions from competition from
13:51the lower and lesser-skilled people.
14:01To see the effects of minimum wage laws in
14:03action, go to a place like this where they
14:06sell quick and inexpensive food.
14:08You don't need much training to
14:09start work on this job.
14:12It used to be a traditional training
14:14ground for the unskilled.
14:16Not any longer, thanks to the
14:18minimum wage laws.
14:21LEE ROBERTS: From the worker’s point of
14:22view, the people that it was supposed to
14:24help are the people in some cases it's
14:26hurting the most, such as minorities,
14:29unskilled labor and young people.
14:32A businessman, especially a small
14:34businessman, cannot afford to bring in
14:36these people at the higher wage.
14:39They are willing, however, to take
14:42apprentices and to train them.
14:44It's very difficult to do now
14:46under the minimum wage laws.
14:49FRIEDMAN: The people who are
14:50discriminated against most by high
14:52minimum wage rate are the people with
14:54low skills, which includes a disproportionate
14:57number of Negroes.
14:59Indeed, I have long believed that the
15:03minimum wage rate was the most anti-Negro
15:05piece of legislation on our statute books,
15:07not by intention, but through its results.
15:18The more they get paid, the better people
15:21can live, whether they are paid
15:22in cash or in kind.
15:27The staff restaurant in the Department
15:29of Housing and Urban Development
15:30in Washington, D.C.
15:32These people are eating subsidized food.
15:35Like all civil servants federal workers get
15:37extremely generous fringe benefits.
15:41They have also had an incredible
15:43degree of security.
15:44It has been almost impossible
15:46to fire a civil servant.
15:48In January, 1975, a typist in the
15:51Environmental Protection Agency was so
15:54consistently late for work, that her
15:56supervisors demanded she be fired.
15:59It took 19 months to do it and this incredible
16:0321-foot-long chart lists the steps that had to
16:06be gone through to satisfy all the rules and
16:09all the management and union agreements.
16:11UNNAMED INDIVIDUAL: This is really a
16:12typical horror story is what it amounts to.
16:14It shows the number of steps
16:17you’ve got to go through.
16:19FRIEDMAN: The process involved the girl's
16:20supervisor, his deputy director, his director,
16:24his director of personnel operations, the
16:27agency's branch chief, an employee relations
16:30specialist, a second employee relations
16:32specialist, a special office of investigations,
16:35and the director of the
16:37office of investigations.
16:38This veritable telephone directory, need I
16:41add, was paid with taxpayers’ money.
16:46Who could invent a better-protected job than
16:48this one before it came to its end?
16:50WORKER: We now have a time certain
16:52at which the decision has to be
16:53made within the agency.
16:56FRIEDMAN: Half an hour's drive out of
16:57Washington you come to Montgomery
16:59County, where many very senior
17:01civil servants live.
17:03It has the highest average family income
17:05of any county in the United States.
17:07Of the people who live here who are
17:09employed, one out of every four works
17:12for the federal government.
17:14Like all civil servants, they have job security,
17:16salaries linked to the cost of living, a fine
17:19retirement plan also linked to the cost of
17:22living, and many manage to qualify for Social
17:25Security as well, becoming double-dippers.
17:28Many of their neighbors are also here
17:30because of the federal government:
17:31congressmen, lobbyists, top executives of
17:34corporations with government contracts.
17:40As government expands,
17:41so does this neighborhood.
17:51Government protects its workers just as
17:53trade unions protect their members.
17:55But both do it at someone else's expense.
17:59It doesn't have to be that way.
18:08Dick Pashley is an electronics engineer.
18:10He designs memory systems for computers.
18:15He works for Intel Corporation, one of many
18:17companies which have sprung up
18:19south of San Francisco at a place
18:21that they call Silicon Valley.
18:23DICK PASHLEY: All these companies
18:24have one thing in common.
18:26They are trying to get engineers to
18:27work on their projects.
18:29Now, myself, I'm one of these engineers and
18:31so obviously I get letters in the mail,
18:35phone calls, the like, where people are
18:38trying to get me to leave Intel and go
18:41to this particular company.
18:43One of the companies right across the street
18:45here, Intercel, is one of the new
18:47companies that's forming in this area,
18:49and they are hunting for people
18:53just like myself to come in.
18:55And what they do is they'll offer you like
18:56typically a like a 30% higher salary, stock
19:00options, a bonus and several other things
19:04to get you to move to their company.
19:07Since it's not really a move,
19:08it's very easy to do because you're
19:10only going across the street.
19:11It's not a big traumatic thing where you are
19:15leaving, let's say, one city and
19:17moving to another city.
19:18It's very straightforward.
19:22FRIEDMAN: In the free labor market
19:23everybody benefits.
19:25When the market is restricted,
19:26things are very different.
19:28Those Mexicans are heading for the
19:30United States side of the border.
19:33There are real problems about permitting
19:35unrestricted immigration into a welfare state.
19:38It's one thing when people come for jobs
19:41and are on their own as was the case
19:43for most of American history.
19:45It's another thing when a welfare system will
19:47support them come what may at the
19:50expense of other people.
19:51Yet look what happens when you try
19:54to interfere with market forces.
19:56WORKER: Well there's several fairly large
19:58groups of aliens on the hillsides waiting for
20:01dark to set in, other groups that are still
20:05on the Mexican side of their border.
20:08They'll be coming in shortly I imagine.
20:14We have electronic sensors buried in along
20:16the hillsides along the most traveled trails to
20:19alert us when there's alien crossings.
20:22And from the sensor we work ahead of them,
20:25try to head them off.
20:30(helicopter engine and radio transmittion)
20:38(police siren)
20:45(engines and sirens)
20:56FRIEDMAN: This is not a case of good
20:57guys against bad guys.
20:59The officers are simply trying to
21:01do their duty.
21:03The poor Mexicans are driven by hunger
21:05and attracted by the prospect of jobs.
21:08WORKER: You do good work.
21:10The law enforcing people
21:11have an impossible job.
21:13(helicopter engine and radio)
21:17OFFICER: They're gonna run,
21:18they're gonna get picked up- sent back,
21:19but sooner or later they’re going to make it,
21:20one minute after the next, you know?
21:26FRIEDMAN: In one month,
21:27in 1978- 60,000 illegal immigrants
21:30were arrested on this stretch
21:32of the border.
21:33But believe it or not,
21:35the Border Patrol estimated that
21:37nearly 200,000 found their way
21:39through to places like this in
21:40Northern California, where there
21:42was work waiting for them.
21:51Illegal Mexican immigrants are
21:53not cheap labor around here.
21:55Many earn more than the
21:56minimum wage law demands.
21:58They can do so because farmers
22:00need many extra hands during
22:02the harvest season, and there is
22:03a shortage of domestic labor
22:05available. Jill Hammond and her
22:09partner run a farm
22:10that produces plump
22:12California raisins.
22:14JILL HAMMOND: There's pending
22:15legislation which would make it
22:17illegal for farmers to hire
22:18undocumented workers. And
22:21supposedly- it would impose a
22:23$1,000 fine per worker
22:24on the farm. I can't imagine that
22:28it would actually go through.
22:29If it did, there'd be a full-scale
22:30farmers' revolt around here.
22:34Matter of fact, last year
22:36there was quite a bit of activity
22:38in the Kerman area, which is
22:40about 15 miles west of Fresno.
22:43Many of the farmers banded together,
22:45and as much as warned the
22:48Border Patrol to stay off their property.
22:51And they were willing to back that up
22:53with guns, I'm afraid. They were
22:56very upset about it, and...
22:57because their situation was desperate.
22:59They needed the workers,
23:00and they needed the work
23:01to be done now. And the
23:04Border Patrol was interfering with
23:06that, as they saw it.
23:08FRIEDMAN: Violence by employers
23:09to assure the availability of workers
23:12is no more justifiable than violence by
23:15trade unions, to assure their members jobs.
23:18But violence is one of the things
23:20you are very likely to get
23:22when you try to prevent a deal between
23:23people who have jobs to offer, and
23:25people who are looking for jobs.
23:28Fifteen years ago, the economy of
23:30Spartanburg, S.C. was stagnant.
23:34It depended on peaches and cotton.
23:36Wages were lower than the national
23:37average, and unemployment was
23:39higher than the average.
23:41(factory noises)
23:45Then, dramatically, the picture changed.
23:49The people in Spartanburg decided
23:51to make their town a center
23:53of free trade. They did this by using
23:58a new Right to Work law,
23:59eliminating many restrictions on labor.
24:03The City Council cut taxes to the bone.
24:05They advertised the fact- that Spartanburg
24:08was a place worth investing in.
24:12By any standards, let alone Spartanburg's,
24:15the result was revolutionary.
24:19Industrialists came from Germany,
24:21Switzerland, and all over the world
24:22to build factories, to set up plants.
24:27The workers of Spartanburg clearly
24:29benefited from the new industries.
24:32The first to notice were the
24:34people who owned and ran
24:35the traditional industries.
24:40M. L. CATES: In terms of the business,
24:41it has been a problem for us.
24:44It means that we've got to be
24:45on our toes, we've got to be
24:47sure we're providing a good
24:50work place, that we are providing
24:52good jobs and what have you,
24:54and that we are running
24:55as competitively as possible.
24:57I think that from the workers'
24:58point of view, this has certainly
25:00provided them with more
25:01opportunities to, for a market
25:04for their product, their labor,
25:07their expertise.
25:11FRIEDMAN: Suddenly, in a free market,
25:13workers who once could not
25:15find jobs- were now at a premium.
25:19Everyone benefited, workers and employers
25:21alike, and the town thrived.
25:27(car engine)
25:34One of the workers who arrived
25:35in Spartanburg was Mr. Juma.
25:38He came as a refugee
25:39from Idi Amin’s Uganda.
25:44MR. JUMA: We came in
25:45this country just with $139.
25:48I had a family, my wife
25:49and two kids. And, we came
25:52with only four bags of clothing,
25:56which weighs about 40 pounds
25:59each bag. We were not allowed
26:00to take more than that.
26:01We had to leave all our possessions,
26:04all our property in Uganda.
26:09And myself, I just came down
26:11to Flowers Baking Company, and
26:13I was hired as a laborer to work
26:16in the plant at $2.49 per hour.
26:23FRIEDMAN: Five years later, he was
26:25chief accountant of the company.
26:27In a free market his best protection,
26:29his real wealth, turned out to be
26:31his skills, and his desire to use them.
26:36America has to offer me a lot of things.
26:40And this is a great country.
26:43I came in this country penniless,
26:45today I own a house,
26:47I own three cars, my wife has
26:49got a good job, I myself have
26:51got a good job, and the children
26:53are schooling, and everything
26:56has been working so fine.
26:58I believe this because of the opportunity.
27:00This is where everyone wants to work
27:02in this country. There is lot of opportunity.
27:06(factory sounds)
27:12FRIEDMAN: When unions get
27:13higher wages for their members by
27:15restricting entry into an occupation,
27:18those higher wages are at the expense
27:20of other workers who find their
27:21opportunities reduced. When government
27:23pays its employees higher wages,
27:26those higher wages are at
27:27the expense of the taxpayer.
27:29But when workers get higher wages
27:31and more civilized working conditions
27:34through the free market, when they
27:37get them by firms competing with
27:39one another for the best workers,
27:41by workers competing with one another
27:42for the best jobs- those higher wages
27:44are at nobody's expense.
27:47They can only come from
27:49higher productivity, greater capital
27:50investment, more widely-diffused skills.
27:54The whole pie is bigger.
27:56There is more for the worker,
27:57but there's also more for the employer,
28:00the investor, the consumer and
28:02even the taxpayer.
28:04That's the way a free market system
28:06distributes the fruits of economic progress
28:09among all the people. That's the essence
28:11of the age of the worker.
28:15(closing music)
28:19ROBERT McKENZIE: The discussion is
28:20already underway, here at the
28:21University of Chicago, so let's join it.
28:24Well, we tried a free market
28:25system without labor unions.
28:27We tried it back in the 1920s,
28:29and into the '30s, and it led the world
28:31into the biggest economic disaster
28:33it's ever seen in modern times.
28:35Now, I don't think that we're talking
28:37talking free market or labor unions.
28:39We're talking free market- with
28:40or without labor unions.
28:42And a free market system
28:43without labor unions
28:44is a total disaster.
28:46McKENZIE: Let's get other reactions
28:47to this, now, around the group.
28:49It’s the free market system,
28:51Milton's Friedman's been arguing,
28:52I think, not labor unions,
28:53which best protect the interests or
28:55serve the interests of the worker?
28:57Walter Williams, your reaction.
28:58WALTER WILLIAMS: Well, I think clearly
29:00labor unions serve the best interests of
29:02workers- who happen to be members of
29:04labor unions- at the expense of workers
29:07who are excluded from being
29:09members of labor unions.
29:11McKENZIE: Ernest Green?
29:12ERNEST GREEN: I don't think you can have
29:13a democratic society without having
29:15trade unions. I think if you look
29:17at any democratic country,
29:18it's essential to it, right of workers
29:20to organize, and I think it's consistent.
29:23If we are to maintain a democratic
29:25country, those freedoms that-
29:27the right of workers to organize
29:29is a primary objective that
29:30we have to maintain.
29:32McKENZIE: Bill Brady?
29:32WILLIAM (BILL) BRADY: Well, if they are
29:33so vital, why are so many union
29:36members leaving the union?
29:38Why are they, why are they
29:41losing so many -- why are the unions losing
29:43so many decertification elections?
29:47Why has the number of union members
29:50declined so precipitously- from 23 percent
29:54of the general labor force to...what is it
29:57now...less than 19, 18 percent?
29:59LYNN WILLIAMS: All depends
30:00whose figures you're reading.
30:01But workers aren't leaving the
30:03labor movement in droves.
30:04The union is not declining precipitously.
30:07My union, the
30:09United Steel Workers of America,
30:10the major unions in the country,
30:12many small ones are out organizing
30:13and growing. The mix of work --
30:15the mix of work in the society
30:17is changing. We have some employers,
30:19as we saw in the film...
30:21who can't wait to rush off to the south
30:23and try to get in an antiunion
30:24environment, and invest their money
30:26in prosperity in the south- instead of
30:28in the north, and surely if you
30:29invest money anywhere...you're
30:31going to have prosperity.
30:32McKENZIE: Let me just -
30:33So, we also have a mix in terms
30:34of civil service and service workers,
30:36where we have employers who
30:37have grumbled on that film
30:39LYNN W: about $2.90 minimum wage. BRADY: I don't know that if you
30:40BRADY: I don't know that if you
30:41invest money anywhere that
30:43you're going to have prosperity.
30:45I don't think that that's a given.
30:46That is, you seem to me to be
30:48dealing in a premise there
30:50that is incorrect.
30:51(Several people talking at once.)
30:53McKENZIE: Wait a minute now...
30:54wait a minute.
30:55The key question we're discussing is:
30:56Who protects the worker?
30:58Is it the labor union or
31:00the free market that
31:01best serves his interest?
31:03W. WILLIAMS: Well, it seems
31:04like from the evidence that I have...
31:06from a number of research projects
31:09that I've engaged in, I’ve found
31:11that labor unions protect their members,
31:13often at the expense of
31:14disadvantaged people.
31:16And it's a very, very interesting
31:18question that the labor unions,
31:20down through the ages, have
31:21discriminated against all kinds of
31:23W. WILLIAMS: people- in favor of a L. WILLIAMS: We haven't, Walter...
31:25W. WILLIAMS: particular class of workers. L. WILLIAMS: ...we haven't.
31:27W. WILLIAMS: We find that labor unions
31:30have gone out on strikes, and
31:31have murdered and maimed people
31:33because other people sought entry,
31:35and in terms of Mr. Green's remark,
31:38he says that in the free democratic
31:40society, we need labor unions.
31:41Yes, that is true, we need
31:42the right for voluntary association,
31:44that is, free people have the right
31:46to form associations, but it should not
31:49be a requirement that you be a
31:51member of a labor union
31:52in order to establish a
31:53contract for employment.
31:54L. WILLIAMS: Can't we get some --
31:55can't we get some perspective
31:57in this, Walter? Talking about unions
31:59down through the ages makes no
32:01sense at all in terms of where
32:03we're at now in this century
32:04at this time. This business of
32:06trying to relate where unions
32:07come from to the, to the medical
32:10profession and Hippocratic oaths,
32:12Hippocratic Oaths or hypocritical oaths,
32:13however one looks at that,
32:14back in the Greek islands
32:16really have very little relevancy.
32:18W. WILLIAMS: Yes it does.
32:18L. WILLIAMS: The violence,
32:19see hear me out a minute,
32:19I waited patiently.
32:21W. WILLIAMS: Okay, okay.
32:21L. WILLIAMS: The violence it's associated
32:23with -- well, not so patiently,
32:24but I waited. The violence
32:26associated with the labor movement
32:27and so on have been minimal
32:29and was a reaction,
32:31in this century,
32:32not over the ages,
32:33a reaction in this century to
32:35the violence done workers
32:37by corporations and powerful
32:39economic groups when there
32:40was no workers' organization
32:41to protect them and no way
32:43to deal with their greed
32:45and with their power –
32:45McKENZIE: Okay. Now,
32:46now I'm turning to Milton
32:47because he's heard the flavor
32:48of the discussion.
32:49FRIEDMAN: Sure.
32:50What Lynn Williams is now
32:51saying is utter nonsense.
32:52There's no other --
32:54no two ways about it.
32:55The conditions of the worker
32:57in this country before there was
32:59labor unions were very important --
33:00improved very greatly.
33:01You cannot tell me
33:02the millions of people,
33:03my parents, your parents,
33:04for all I know,
33:05parents of many people around,
33:07came to this country
33:08from Europe in order to be
33:09exploited and in order
33:10to be subjected to violence.
33:12Of course, there were
33:13incidents of violence.
33:14GREEN: I disagree with that vehemently.
33:15I mean most of the blacks
33:16came to this country not voluntarily,
33:17but they were shipped here.
33:19FRIEDMAN: The blacks -
33:19GREEN: And the interesting
33:20thing about the issue on --
33:21on Spartanburg though -
33:22FRIEDMAN: The blacks did not
33:22-- excuse me, hold on for a second.
33:23GREEN: Is that you left out -
33:24FRIEDMAN: Hold on.
33:24MCKENZIE: Let him finish
33:26and then back to you.
33:26GREEN: All right.
33:27FRIEDMAN: The blacks are
33:28an exception and I agree
33:29with you completely.
33:30GREEN: Twenty-two million
33:30exceptions, though.
33:31FRIEDMAN: But they are a
33:32very important exceptions.
33:33But there are also millions
33:35and millions - the people that
33:36Mr. Williams represents are
33:37not mostly black. They are
33:39mostly from the Slavic countries,
33:41came from Eastern Europe.
33:42L. WILLIAMS: If you look at the
33:43membership of the Steel Workers –
33:44FRIEDMAN: If we -- if we go back,
33:45of course, there always has been violence.
33:49It's not excusable,
33:51I'm not excusing violence
33:52on the part of anybody,
33:53but I agree with Mr. Green
33:55and with Walter Williams
33:57that people should be free to organize.
34:00of course they should be free to organize.
34:01What I object to is the special privileges
34:04that have been given by government to
34:06labor unions which are not available
34:09to other groups at all.
34:10When labor unions have used violence
34:13in industrial disputes they are not
34:16subjected to the same sanctions
34:18as people ordinarily are.
34:19When cars are turned over in the course
34:21of a labor dispute, how often do
34:23people go to jail as a result of it?
34:24L. WILLIAMS: Dr. Friedman and Walter
34:25Williams go back in history
34:27and they take a look at a situation where
34:29America was empty, where we didn't have
34:31anything like the sophisticated industrial
34:33economy we have today,
34:35but had a much more agricultural
34:36and rural kind of economy and of course
34:39when the -- when the impoverished
34:40peasants of Europe, my ancestors
34:42and most of our ancestors,
34:43except for the slaves, which is
34:45another situation, but when these
34:47people came from Europe and came to
34:49a wide open continent with the most
34:51fertile soil then available to
34:52anyone in the world,
34:54naturally there was progress
34:55and I or any of us would be
34:56mad to deny progress.
34:57But as that developed and as population
35:01increased and as we moved into a
35:02much more sophisticated industrial economy,
35:04we moved then into the situation
35:06in the 1930s, or earlier than that,
35:09at the end of the century, as some
35:10of the more skilled jobs came along.
35:12The labor movement didn't happen
35:14by accident, didn't happen because
35:15there wasn't a need there.
35:17The results of this development, even
35:19with all the wealth available in America,
35:21the results of this development was that
35:24many working people were not having
35:25anything like, by standards of civilization
35:29or whatever, anything like
35:31their fair share in this progress.
35:33McKENZIE: Now you're arguing
35:34that in a free market,
35:35for labor, everyone benefits.
35:38Does that mean that you would favor
35:40abolition of all immigration restrictions?
35:42FRIEDMAN: The situation of immigration
35:44restrictions really has to do with
35:46the question of a welfare state.
35:48As I say in the film,
35:50I would favor completely free immigration
35:54in a society
35:55which does not have a welfare system.
35:57With a welfare system of
35:58the kind we have,
36:00you have the problem that people
36:01immigrate in order to get welfare,
36:03not in order to get employment.
36:05You know it's a very interesting thing,
36:06if you had asked anybody --before 1914
36:10the U.S. had no immigration
36:11restrictions whatsoever,
36:13I'm exaggerating a little bit,
36:14there were some immigration restrictions on
36:15Orientals, but it was essentially, mainly free.
36:18If you ask anybody,
36:20any American economic historian,
36:21was that a good thing for America?
36:23Everybody will say yes
36:24it was a wonderful thing for America
36:26that we had free immigration.
36:27If you ask anybody today,
36:29should we have free immigration today?
36:30Everybody will...
36:32almost everybody will say no.
36:33What's the difference?
36:34I think there's only one difference,
36:36and that is that
36:37when we had free immigration
36:38it was immigration of jobs
36:40in which everybody benefited.
36:41The people who were already here
36:43benefited because they got
36:44complementary workers,
36:46workers who could work with them,
36:47make their productivity better,
36:48enable them to develop
36:50and use the resources of the country better.
36:52But today, if you have a system
36:54under which you have essentially a
36:57governmental guarantee
36:58of relief in case of distress,
37:01you have a very, very real problem.
37:03McKENZIE: But this is true of
37:04every western industrialized country.
37:05and that's why today -
37:07you cannot, unfortunately,
37:09have free immigration.
37:10Not because there's anything wrong
37:11with free immigration,
37:13but because we have other policies
37:14which make it impossible
37:16to adopt free immigration.
37:19McKENZIE: Well I'd like
37:20other reactions.
37:20Is it at all feasible to open
37:22the door of the labor market
37:24internationally now? Bill Brady?
37:26BRADY: I would --
37:27I would say yes,
37:27providing they open the door to us.
37:30I think that the door to
37:31not only the labor market,
37:33the door to all markets should be
37:35-- should be open.
37:36That is the product markets.
37:38W. WILLIAMS: My feelings
37:39about the undocumented workers
37:41of Mexican-Americans are inscribed
37:43at the foot of the Statue of Liberty.
37:45I think that the people should have the right
37:47to come to this country.
37:49Now, those who would say, you know,
37:50I hear a number of people saying that,
37:53well the immigrants
37:54are contributing to our
37:55unemployment problem.
37:56And I pointed this out to some people,
37:58I said, "Look, you know,
37:59this is the same rhetoric that the Irish used
38:01when the blacks
38:02were coming up from the north,"
38:03you know,
38:04they're using blacks as scapegoats.
38:05They're saying, "Get those people back
38:06where they came from so that our
38:07members can get jobs," you know.
38:09Unions were as well doing this, you know,
38:11they called them scabs,
38:12strikebreakers, etcetera, etcetera.
38:14So I do not wish for Mexican-Americans
38:17to become the new scapegoats of our
38:19particular national problems.
38:21They are not the problem, and our nation
38:23benefits to the extent
38:25that these people come here and work.
38:27And to that extent -- to that extent
38:28so it's kind of good for them to remain illegal
38:31aliens as opposed to being legal aliens
38:34where they're subject
38:35our welfare programs,
38:37so that we don't want them to come here to -
38:39(Several people talking at once.)
38:40GREEN: I think that this country cannot
38:41have a group of workers to remain outside
38:43the framework of our laws
38:44and our protections.
38:46And as long as we have workers who are
38:49attracted to the United States
38:51because of the standards of living;
38:53and I think minimum wages play
38:55a part in that as part of that attraction.
38:57But it seems to me
38:58to have undocumented workers
39:01without providing
39:02either a means of protection for them,
39:05and it seems to me that we've got to go
39:07to the question of providing
39:09the amnesty for those generations
39:12of workers who have come here
39:15over a period of time,
39:16now two, three, maybe four generations.
39:19We have to see that they have the same
39:21rights and protection of all other workers.
39:24And as it stands now, large numbers
39:26of them live outside the framework
39:28of the laws and statutes
39:30that we have on the -- on our books.
39:33McKENZIE: Comment Milton.
39:33FRIEDMAN: They do and
39:34the tragedy of the situation,
39:35as Walter Williams points out,
39:37that as long as they are undocumented
39:39and illegal they are a clear net gain,
39:41the nation benefits and they benefit.
39:43They wouldn't be here if they didn't.
39:45The tragedy is that we've adopted
39:47all these other policies so that if we
39:49convert them into legal residents
39:51it's no longer clear that we benefit.
39:53They may benefit,
39:54but it's no longer clear that we do.
39:57What Lynn Williams said before is again
39:59a travesty on what was actually going on.
40:01The real boost to the trade union movement
40:03came after the Great Depression
40:04of the 1930s.
40:06That Great Depression was not a failure of
40:08capitalism, it was not a failure of the private
40:10market system as we pointed out in another
40:12one of the programs in this series;
40:14it was a failure of government.
40:15It was not the case that somehow or other
40:19there was a decline in the conditions
40:21of the working class that produced
40:22a great surge of unionism.
40:24On the contrary -- unions have never
40:27accounted for more than one out of four
40:29or one out of five of American workers.
40:31The American worker benefited
40:33not out of unions,
40:35he benefited in spite of unions.
40:37He benefited because there was greater
40:40opportunity because there were people
40:42who were willing to invest their money
40:43because there was an opportunity
40:44for people to work, to save, to invest.
40:47That's still the case today.
40:49You say, we have to provide them with
40:51something or other Ernest.
40:52Who are the “we?”
40:53GREEN: We the people.
40:54(Laughter)
40:54FRIEDMAN: How do, “we the people”
40:55-- but how do “we the people” do it?
40:57GREEN: And it seems -- we the people
40:58provide them the protection by
40:59seeing that their safety -
41:01McKENZIE: You're talking
41:01about the immigration population now.
41:02GREEN: -- and occupational
41:03health codes that protects the environment
41:05that they work in, see that
41:06they have civil rights laws that protect
41:08their own person, see that they have
41:10civil liberties laws that protect them further.
41:13We the people of this
41:14country provide that protection.
41:16W. WILLIAMS: Why are they
41:17coming here it's so bad?
41:17If they don't have, you know,
41:19you're kind of painting an image, you know.
41:20Why are these people coming?
41:21We're not pulling them here by chains.
41:22(Several talking at once.)
41:27McKENZIE: Gentlemen, don't all talk at once.
41:29Lynn, and then -
41:30W. WILLIAMS: So what are
41:30you talking about protecting them?
41:31GREEN: Why did you leave Little Rock,
41:31Arkansas to go to Philadelphia?
41:32It seems to point-
41:32L. WILLIAMS: It seems to me that it's obvious –
41:34W. WILLIAMS: Would you
41:35extend the courtesy to finish.
41:36Look, look, first thing, look,
41:37let me say the following thing:
41:39There's some basic things
41:39that we need to know.
41:40L. WILLIAMS: Well now, are you going to say
41:41the thing I was interrupting or are you
41:42gonna say five more things?
41:43I mean there isn't all afternoon.
41:44W. WILLIAMS: You know, labor unions,
41:46and minimum wages for that case,
41:48cannot improve the condition of
41:51the working people of the country.
41:52L. WILLIAMS: We do it everyday.
41:53W. WILLIAMS: Because if
41:54-- are you suggesting –
41:55L. WILLIAMS: We improve the working
41:56conditions of working people in countries
41:56all around the world, everyday.
41:57W. WILLIAMS: Well you know this --
41:58you know what you're telling the audience,
41:59you're saying that you can solve
42:00the problems in Bangladesh.
42:01You can make them a rich
42:02country if you tell them to
42:03unionize like we are –
42:04L. WILLIAMS: I didn't say that.
42:04W. WILLIAMS: --and demand high wages.
42:05L. WILLIAMS: No, I didn't say
42:06anything remotely like that.
42:07W. WILLIAMS: It's productivity
42:08that keeps income low.
42:08McKENZIE: Lynn, let him finish.
42:09BRADY: I come back to my initial question:
42:10why are so many leaving the union?
42:11L. WILLIAMS: There aren't
42:11very many leaving the union.
42:12BRADY: Oh, there are too.
42:13I've given you the statistics.
42:14L. WILLIAMS: Ah, now, do you think
42:15I'm -- you grind off some percentages.
42:17I live in the labor movement.
42:19BRADY: You -- do you have other
42:19percentages?
42:20FRIEDMAN: In or on?
42:22L. WILLIAMS: In, with and on.
42:25And of course they pay me, of course, and
42:27I don't have any objection to that at all.
42:28FRIEDMAN: Neither do I.
42:28L. WILLIAMS: At least we got
42:29you a few minutes ago --
42:30we got you to get the labor
42:31movement up into this century.
42:33And I agree with the observation you made -
42:35(Laughter)
42:36L. WILLIAMS: I agree with the observation
42:37you made, that the industrial
42:38union movement...
42:39that there was a union movement
42:41came out of the dirty '30s
42:42and out of the depression and grew,
42:44and that that was essentially
42:45an industrial union movement.
42:46But I wonder if --
42:47I wonder when I hear your commentary
42:50on the film and so on about unions
42:52and restricting practices and restricting
42:55access to industry and all of this,
42:56I really -- I don't mean it disrespectfully,
42:59but I really wonder –
43:00FRIEDMAN: Don't mind being disrespectful,
43:01it's all right. I'm used to it.
43:02L. WILLIAMS: I really wonder if you,
43:03if you do understand how the industrial
43:06union movement, which is --
43:07the more recent part of the movement,
43:09how it really operates.
43:10We're not telling anybody
43:11who they have to hire.
43:12FRIEDMAN: (Laughing)
43:15McKENZIE: Let's raise the question,
43:16which certainly is dealt with in the film:
43:17Have minimum wages --
43:19which is a form of government
43:20intervention -- served the interests
43:23of the poor and indeed of
43:24the working class generally?
43:26Now, I know you've spent
43:26a good deal of time looking at this -
43:29W. WILLIAMS: Yes. Okay, well,
43:31at least form the standpoint of teenagers,
43:33particularly minority teenagers,
43:34the minimum wage law has acted to
43:36destroy a number
43:37of employment opportunities.
43:38For example, back in 1948,
43:41the black youth between 16
43:43and 18 had an unemployment
43:45rate of 9.4 percent and white youth was
43:4810.4 percent, or 10.2 percent.
43:50The labor force participation rates of
43:52blacks was considerably
43:54higher than that of whites.
43:56And with each increase in the minimum
43:58wage law, we had the dramatic
44:00reversal that we have now.
44:02And so the minimum wage law
44:03has the effects of saying that
44:05if you cannot produce $2.90
44:07worth of goods an hour,
44:08you don't deserve a job.
44:10GREEN: I don't think -- you
44:11can't look just at the minimum wages -
44:13W. WILLIAMS: But –
44:13GREEN: -- you've got to look
44:14at the relocation of firms.
44:15You've got to -- you've got to
44:16look at the movement of people.
44:17You've -- I mean you can't --
44:18you can't do that.
44:19W. WILLIAMS: Well, can't we just
44:20-- well you look at the relocation of firms.
44:21A lot of people try to say a lot of jobs
44:22move out to the suburbs.
44:23Well, you find black-white
44:24unemployment ratios the
44:25same in the suburbs as you
44:26find in the cities. So it's --
44:28mean, it's the minimum wages.
44:30L. WILLIAMS: Yes, but taking one element
44:30-- you're taking one element
44:31out of a long historic development
44:33and you start comparing 1920 –
44:35GREEN: Even if you hold constant
44:36-- if you hold constant -
44:37(Several people talking at once.)
44:38McKENZIE: Lynn is next,
44:38Lynn and then Ernest Green.
44:39Come on now.
44:40GREEN: I understand the law
44:40of educational achievement.
44:41McKENZIE: Lynn and then Ernest Green.
44:41GREEN: You get a differential
44:42between black and white
44:43unemployment rates -
44:43McKENZIE: I'll bang the gavel...
44:44...Come on. Lynn.
44:45L. WILLIAMS: Well you're
44:46taking -- you're taking one element,
44:48years ago in a situation that's entirely
44:50different that we're in today
44:51and drawing some conclusions-
44:53W. WILLIAMS: Minimum wage.
44:53That's what's different.
44:54L. WILLIAMS: No, no. There are many
44:55other things that are different.
44:56The enormous movement of black
44:57people in this country between 1948
44:59and now. You can't just wipe that out.
45:01And you can't say that's –
45:02W. WILLIAMS: White people move, too.
45:03L. WILLIAMS: -- you certainly can't say
45:04that's the minimum wage. But you know –
45:05McKENZIE: Wait now. I want this case made.
45:07Has the minimum wage served the interests
45:10of the working people in this country?
45:12L. WILLIAMS: I don't think there's
45:13any question -- I don't think there's any
45:14question that the working people
45:17of this country would be much worse
45:18off than they are today,
45:19the youth of this country would be much
45:21worse off than they are today
45:22if we didn't have minimum wage.
45:24McKENZIE: All right, now,
45:25Brady. You -- come on.
45:26BRADY: No, it's I –
45:27McKENZIE: On minimum wages --
45:28good idea or not? You're an industrialist.
45:29BRADY: No. It's a bad idea.
45:31It is patently one of the,
45:31one of the worst things that can --
45:35that we can do to our youth.
45:36We prevent them from –
45:37GREEN: Bill, how many kids
45:38do you have?
45:38BRADY: -- we prevent --what's that?
45:39GREEN: How many kids do you have?
45:40BRADY: I have two.
45:41W. WILLIAMS: It's not
45:41important how many kids you have.
45:42GREEN: But it is. Minimum wage
45:43doesn't affect his industry.
45:43His wages are far above the minimum wage.
45:45FRIEDMAN: Minimum wage doesn't
45:46affect a single one of his members.
45:47(Several people talking at once.)
45:50McKENZIE: Hold it. Hold it. Hold it.
45:52Milton has the floor.
45:53L. WILLIAMS: We have not gone to support
45:54minimum wage legislation in this country-
45:55McKENZIE: Gentlemen, hold it a moment.
45:57McKENZIE: Hold it a moment.
45:58(Several people talking at once.)
46:00McKENZIE: Hold it a moment now. Milton -.
46:02L.WILLIAMS: Of course we have not.
46:02We are a people's organization –
46:03McKENZIE: Lynn -- the Chairman
46:04has said the floor is Milton's.
46:06FRIEDMAN: I was saying that there
46:07is not a single one, I suspect,
46:09of the members of your union
46:11who is affected by the minimum wage.
46:13They are much higher.
46:14FRIEDMAN: You say that you
46:15are a public service organization.
46:17L. WILLIAMS: I say we're a
46:17people's organization.
46:18FRIEDMAN: You're an organization
46:19of your workers.
46:20And if you aren't representing
46:21the interests of your workers
46:22they ought to fire you.
46:23L. WILLIAMS: And we're out –
46:23FRIEDMAN: If you tell us that
46:25you are going against the interests
46:26of your workers you are simultaneously
46:28saying to your workers --
46:29I'm not doing what you hired me for.
46:31L. WILLIAMS: Oh, come on.
46:31This is, this is pure sophistry. I'm not –
46:33FRIEDMAN: It's not sophistry in the slightest.
46:35L. WILLIAMS: -- I am not talking –
46:35FRIEDMAN: I'm just trying to -
46:36L. WILLIAMS: I am not talking about
46:37representing the interests of our workers.
46:38Our union represents a lot of people.
46:40FRIEDMAN: Right. Right. It does.
46:41L. WILLIAMS: And some of the people
46:42are the ones that you're probably aware of,
46:44people who work in big steel mills –
46:45FRIEDMAN: That's right.
46:45L. WILLIAMS: -- and all the rest of that.
46:46FRIEDMAN: Absolutely.
46:47L. WILLIAMS: But we also go
46:47out and organize workers all
46:49the time and win certification
46:50votes despite Bill Brady's comment
46:52about that.
46:53And many of the workers
46:54we organize are workers who are
46:56affected by minimum wage. And the result
46:58of our organizing them is that we're able
47:00to bring them above the minimum wage.
47:02McKENZIE: Yes.
47:03W. WILLIAMS: The point is, is that,
47:04I think that both these gentlemen,
47:06we all should recognize,
47:08is that unions in the United States
47:10support the minimum wage.
47:12They are the major supporters.
47:13They spend millions and millions
47:14of dollars in lobbying for the
47:15minimum wage law.
47:16They do it out of the name of concern
47:18and being in the interest of people.
47:21Now, in South Africa the unions
47:23are far more honest.
47:24That is those white racist unions over there;
47:27they say we support minimum wages
47:29and equal pay for equal work
47:30so as to protect white jobs.
47:33That is to protect white jobs-
47:35L. WILLIAMS: Are you implying –
47:35W. WILLIAMS: -- from low-price competition.
47:37L. WILLIAMS: Are you now implying,
47:38wait, that we're white racists?
47:39W. WILLIAMS: No, I'm not saying that.
47:40I'm saying that it doesn't make
47:41any difference about the intent.
47:43GREEN: Walter, the Urban League supports
47:45minimum wage the -- Ben Hooks
47:48at NAACP supports minimum wage.
47:50McKENZIE: The floor belongs to Ernest.
47:51W. WILLIAMS: They have very good
47:51reasons to support minimum wage.
47:52GREEN: Why?
47:52W. WILLIAMS: Their group that they
47:53represent –
47:53GREEN: Why –
47:54W. WILLIAMS: They represent
47:55middle class whites.
47:56GREEN: No, no, no.
47:57W. WILLIAMS: They don't represent
47:57the poor blacks on the streets.
47:59GREEN: The membership of the
47:59NAACP probably has as many –
48:01W. WILLIAMS: And they're owned by them.
48:03They're owned by the AFL-CIO.
48:04L. WILLIAMS: They aren't
48:04owned by the AFL-CIO.
48:05McKENZIE: Order. Order.
48:06L. WILLIAMS: That is a conservative's view
48:08McKENZIE: Order. Order.
48:10L. WILLIAMS: That is a conservative's view
48:10(Several people talking at once.)
48:13MCKENZIE: Order! I'm going to --
48:14I'm going to -- I'm going to --
48:14I'm going to turn to Milton now.
48:16Are you saying, then,
48:17that you would advocate the repeal
48:18of minimum wage legislation?
48:20FRIEDMAN: Of course.
48:21McKENZIE: You would.
48:22FRIEDMAN: Of course I would.
48:22(Several people talking at once.)
48:24McKENZIE: Bill Brady, Bill Brady.
48:25BRADY: I should like to ask Ernest
48:26and Lynn why they want to restrict
48:28a minimum price to labor.
48:31Why don't you let me have a minimum price
48:33on the products that we manufacture?
48:35L. WILLIAMS: Well we aren't here,
48:36as I understand it,
48:37to discuss your problems at
48:38the moment in terms of the owners –
48:40BRADY: Is there a difference?
48:42Why a minimum amount of profit --
48:44L. WILLIAMS: Well, you're the people
48:45I assume who are so anxious to
48:46have the free market system and to
48:47compete with each other and all
48:48the rest of it,
48:48we're talking about the needs of the
48:50workers and, we're talking about the needs
48:51of the people who come into a society
48:53which isn't providing enough employment
48:55for them, which clearly doesn't
48:57seem to be able to provide
48:58enough employment for them,
48:59and what are we going to do?
49:00And I think this notion that somehow
49:02if we just let every guy who is running
49:05a hamburger stand or whatever,
49:06we just let all these people exploit the
49:08young people of this nation in any way
49:11they chose, pay them any little rate
49:14they could get away with,
49:15that everybody would then go
49:16to work, would everybody
49:18then have a job, is absolute nonsense.
49:20McKENZIE: I want to bring Milton
49:21to one of the final stages of his film,
49:23which is Spartanburg, South Carolina.
49:26FRIEDMAN: Sure.
49:26McKENZIE: And I want to know what your
49:27what conclusion you're drawing from that.
49:29Would you, in effect,
49:31like to see the whole of the United States
49:33become, as it were,
49:35Spartanburg writ large?
49:36FRIEDMAN: Absolutely.
49:37McKENZIE: Yeah. What would that mean?
49:39And then we'll get their reaction to it.
49:40FRIEDMAN: It would mean a widening
49:43of the opportunity for everybody.
49:44It would mean an opportunity for
49:46employers all over to compete with
49:49one another for workers.
49:50It would mean an opportunity for
49:52workers to find jobs which can make the
49:54greatest use of their own skills
49:56and their own capacities.
49:57It would mean that consumers
50:00would be able to get better
50:00products at lower prices.
50:02You know, consumers enter into
50:03this situation, too.
50:05You might think that somehow
50:06or other, you know --one of the
50:08things that's always a mystery to me,
50:09if a $2.90 minimum wage benefits
50:12people why wouldn't a $6 minimum
50:14wage be better?
50:15Wouldn't a $10 minimum wage be better?
50:17Why don't these people come out
50:18for a $200 figure minimum wage?
50:20If all you had to do to make a country -
50:21ERNEST GREEN: You're pretty smart -
50:23FRIEDMAN: Two hundred dollars an hour.
50:24W. WILLIAMS: Or extend it to babysitters.
50:26FRIEDMAN: Yeah. If all you need to improve
50:28the lot and the conditions of people
50:30is to legislate a higher -
50:31McKENZIE: You're back on minimum wages.
50:32I want to know how Spartanburg -
50:34Spartanburg improves matters because
50:36it introduces a wider range of competition
50:39and the real thing that protects the
50:43worker is the existence of
50:45alternative employers
50:46seeking his services, just as what
50:47protects the consumer is alternative sellers.
50:50BRADY: Milton, you omit one thing
50:52that it would do.
50:53And it would result in a very
50:54substantial increase in capital investment.
50:56FRIEDMAN: Absolutely. It would.
50:58BRADY: And capital is the
50:59worker's second best friend.
51:01FRIEDMAN: Sure.
51:02L. WILLIAMS: This is only to say, surely –
51:02FRIEDMAN: The reason why
51:03everybody can benefit.
51:04L. WILLIAMS: This is only to
51:04say that a busy economy,
51:06one in which there's investment
51:08and development and so on is an economy
51:10that's a good economy for
51:12working people and for everyone else.
51:13I think we say that in the AFL-CIO
51:16at least once a month, all the time.
51:18There's nothing in which --
51:19there's nothing in which we're
51:21more interested
51:22than having a busy, functioning economy.
51:24The question is how to bring that about.
51:26I do suggest, and I think --
51:28I think can be defended as long
51:31as we want to discuss it, that the
51:34prosperity we have in America today,
51:36that the labor movements have made
51:38an enormous -- the labor movement
51:39has made an enormous contribution to that,
51:41and in the absence of the labor movement
51:43and in the absence of minimum wage
51:44this would not be as prosperous
51:46a country as it is.
51:47That is not to say that it’s perfect.
51:49McKENZIE: Now hold it there
51:49-- hold it there, Lynn.
51:50I want to get a reaction to that.
51:51He stated the case for what
51:53unions have achieved.
51:54Could we go around, first of all,
51:56do you accept any part of that?
51:57W. WILLIAMS: No, it's preposterous,
51:58you know, as I suggested before.
51:59I mean, if we, you know,
52:02if minimum wages could make people richer
52:04McKENZIE: Unions we're talking about now.
52:05W. WILLIAMS: Well, if unions
52:05could make people richer -
52:06McKENZIE: Yeah.
52:07W. WILLIAMS: -- all you have to do
52:08is tell people in Bangladesh,
52:09Why don't you unionize and demand a
52:10higher wage? You could be
52:11rich like the United States.”
52:11L. WILLIAMS: We're telling
52:12everyone in the world.
52:12W. WILLIAMS: It's productivity.
52:13L. WILLIAMS: We told them in
52:13Japan it works.
52:14McKENZIE: Lynn -W.
52:15W. WILLIAMS: The workers have higher
52:16wages in our country because
52:17they're more productive.
52:18That's how you get higher wages.
52:20And this just plain
52:21-- I mean, it's nonsense.
52:22BRADY: And why
52:23are they more productive?
52:24W. WILLIAMS: Because they have capital
52:25BRADY: Enormous capital investment.
52:27(Several people talking at once.)
52:28BRADY: And the highest wages
52:28are paid and in the higher
52:29the capital-intensive industries.
52:30L. WILLIAMS: And because there are
52:31consumers to buy the stuff who
52:32have wages which enable them
52:34to go into the marketplace
52:35and buy something.
52:36BRADY: Without the capital investment
52:36they wouldn't have the wage and it
52:37would be no way of paying them
52:38without the capital investment.
52:39L. WILLIAMS: If all those workers
52:40weren't making any money there
52:40wouldn't be much prosperity
52:41BRADY: There would be no way of
52:41paying it without the capital investment.
52:42McKENZIE: Ernest Green,
52:43what's the reply, your reply?
52:44GREEN: I stand by my initial statement,
52:46that it is a prerequisite of the
52:48democratic society to have trade unions,
52:51organizations aligned, workers to band
52:54together in their mutual interests, and -
52:56W. WILLIAMS: Are you
52:57saying voluntary associations?
52:58GREEN: And if that, if that group --
52:59I'm saying that trade unions like
53:01A. Philip Randolph's sleeping car porters,
53:03the Pullman car company would
53:06have never, on its own, given those workers,
53:09who worked very hard and were very
53:11productive people, well educated,
53:13any increase in their wages had it
53:15not been for the intervention of Randolph.
53:17FRIEDMAN: The crucial issue is whether
53:19governmental measures which have
53:22the effect of favoring union organization,
53:25of giving them privileges and immunities
53:28that are not accorded to other organizations
53:30in the society, benefit the society
53:32as a whole,
53:33or harm the society as a whole.
53:35The proposition I tried to make in this film
53:37was that the source of the prosperity
53:40of this country was freedom of enterprise,
53:43freedom of employers to hire,
53:46of workers to work for whom they
53:47wanted to; and insofar as unions have
53:50played a role, they have protected
53:52some workers at the expense of others,
53:54and have retarded the prosperity
53:57of this country. I think that Lynn Williams'
53:58statements to the contrary
54:00cannot be supported
54:01by any empirical or other evidence,
54:03that he has, understandably
54:05I'm not blaming him for this,
54:06he would be faithless to his job
54:09if he did not believe sincerely
54:12in what he's saying. I'm not questioning his
54:13sincerity, but sincerity is a
54:15much overrated virtue in our society.
54:17The plain fact is that there is no
54:20evidence whatsoever that either unions
54:23or minimum wages have made positive
54:25contributions to the
54:26prosperity of this country.
54:28Some unions have, of course;
54:30some unions have done great harm.
54:31It's not an open and shut picture in
54:35which you can make a sweeping statement.
54:38But on the whole,
54:39the growth of this country -
54:41ERNEST GREEN: I'd like
54:42for you to make a sweeping statement.
54:43FRIEDMAN: I do. The sweeping statement
54:44I make is that the prosperity
54:46of this country derives primarily
54:48from freedom of enterprise and freedom
54:50to hire, to employ, to work,
54:53and not from restrictive
54:55measures imposed by trade unions.
54:56McKENZIE: Everybody briefly now. Ernest
54:57GREEN: And I would say that
54:58the intervention
54:59of a strong federal government,
55:00who those employers hire,
55:03the kinds of protection,
55:05the wage standards, health conditions,
55:08are the requirement of this government
55:11to protect its people. Because the history
55:14of it has shown that that hasn't occurred,
55:16and in your case in Spartanburg,
55:19South Carolina, again,
55:20I argue that the only reason that they can
55:23come back now and attract firms
55:25from Switzerland
55:26and Germany is because,
55:27one that we had a strong government
55:29that provided protection for all
55:31of its citizens which
55:32didn't occur fifteen years ago.
55:34McKENZIE: Bill Brady.
55:34BRADY: Economic freedom, in my opinion,
55:36should not be abridged.
55:36I think that these two gentlemen are
55:38advocating that it be abridged.
55:39They're advocating a retention
55:40of the minimum wage.
55:41They're advocating, I think,
55:42Lynn Williams is advocating the
55:44retention of the Davis-Bacon Act.
55:46They do not, it seems to me,
55:49believe that freedoms are
55:51interdependent and indivisible.
55:53There are freedoms --
55:54there is economic freedom;
55:55there is press freedom;
55:56there is freedom of assembly;
55:57there's religious freedom.
55:58And you are advocating to me
56:01a great abridgement of economic freedom,
56:04and when you do that you injure the
56:07other freedoms that we have.
56:08And if you do it enough, as we are doing
56:10in this country today, if you do it enough
56:11we are in danger
56:12of losing all of our other freedoms.
56:13McKENZIE: Now we leave this
56:15very spirited discussion,
56:15and I hope you'll join us again
56:16for the next episode of
56:18Free To Choose.
56:20(closing music)

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