In Free to Choose, Milton Friedman wrote:
But when workers get higher wages and better working conditions through the free market, when they get raises by firm 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’s more for the worker, but there’s also more for the employer, the investor, the consumer, and even the tax collector.
That’s the way the free market system distributes the fruits of economic progress among all people. That’s the secret of the enormous improvements in the conditions of the working person over the past two centuries.
What would Friedman say about higher productivity and greater capital investment, an increasing pie, when the increases are denied to the worker, and the employer, and the consumer, and the tax collector? Somehow, I think even Mr. No-government-regulation would cry, “Foul!”
- What is real job creation? at Unions Matter