Robert Reich: Restore the Basic Bargain

[marmar]

Published on Wednesday, November 30, 2011 by Robert Reich
Restore the Basic Bargain

by Robert Reich


For most of the last century, the basic bargain at the heart of the American economy was that employers paid their workers enough to buy what American employers were selling.

That basic bargain created a virtuous cycle of higher living standards, more jobs, and better wages.

Back in 1914, Henry Ford announced he was paying workers on his Model T assembly line $5 a day – three times what the typical factory employee earned at the time. The Wall Street Journal termed his action “an economic crime.”

But Ford knew it was a cunning business move. The higher wage turned Ford’s auto workers into customers who could afford to buy Model T’s. In two years Ford’s profits more than doubled. ..............(more)

The complete piece is at: http://www.commondreams.org/view/2011/11/30-2

[xchrom]

1. recommend

[limpyhobbler]

2. recommended

[hedgehog]

3. I always thought that Henry Ford raised wages not to enable his

employees to enjoy a decent standard of living, but because working his assembly line was so grueling and mind numbing that workers kept quitting. The increase in wages was meant to reduce employee turnover and attract better workers. (Many of the early workers took their money and drank it all.)

[shraby]

4. Nope, the jobs at Ford were so in demand that if anyone took

a day off sick or didn't get to work on time, they were replaced with another worker..and the person who got sick or was late lost their job. This was before unions.