Says William McDonough, executive vice president of the United Food and Commercial Workers union, in today’s New York Times:
“Henry Ford made sure he paid his workers enough so that they could afford to buy his cars. Wal-Mart is doing the polar opposite of Henry Ford. Wal-Mart brags about how its low prices help poor Americans, but its low wages are helping increase the number of Americans in poverty.”
Of course, unions have their own special interest in attacking Wal-Mart. The firm is not unionized, it is profitable, and its existence hurts unions’ efforts to maintain their wage scales in a competitive labor market. Let’s not forget that it was Henry Ford, and others, whose decision not to adjust wages in 1929-30 that caused labor markets not to clear, helping to prolong what otherwise might have been a quick market-adjustment into the Great Depression. Maybe this is what union leaders like McDonough want, given that the 1930s were great for union workers whose real wages increased dramatically in the face of falling prices.
Read the article, especially the Wal-Mart CEO’s response to the Henry Ford argument, and to other economic fallacies that are being used against the firm.
