NYC School Bus Strike

This story is interesting.  In NYC, there is a school bus strike.  According to that article, bus drivers make $14/hr as a starting salary and $29/hr with lots of experience.

$29/hr is a pretty high salary for a bus driver!  It’s the usual example of unions collecting economic rent.

There’s one interesting legal loophole.  The NYC government hires private contractors to drive the buses, even though the buses transport children to public schools.  The bus drivers work for the contractor and not the government.  That allows politicians to claim “It’s not our fault!  Blame the private corporation that hires the drivers!”

The NYC government is going to place the bus driver contracts up for bid again.  Some new corporation will get the contract, and hire newer/cheaper workers.  The old corporation has the union contract and experienced/expensive workers.  Therefore, the new corporation will win the bid, and the old corporation is forced to close and fire workers.

The drivers are striking to protest the fact that they will be fired when the contracts are put up for bid again.

The underlying problem is that a bus driver is not a $29/hr job.  The unions priced themselves out of the market, by demanding an unreasonably high salary.

Suppose the government puts the contracts out for bid with a 3 year contract.  Shouldn’t the union contract also be for 3 years, with the same expiration date?  The employer should have insisted that the union contract expire at the same time as the government contract.  Also, having the contract end in the middle of the school year gives the union extra negotiating leverage.

That is an interesting loophole for firing experienced and overpaid unionized workers.  Form a new corporation, and the old corporation folds and fires its workers.  That’s what Hostess did when it declared bankruptcy and fired all its employees.  The NYC government is exploiting that legal loophole, by giving out bus driver contracts.

Unions receive a massive State subsidy, in the form of labor law.  When a strike ends, the employer is forced to hire the workers back.  The reduces the risk when workers strike.  I can’t believe some pro-State trolls were arguing with me on this point, when I wrote about the LA port strike.  When workers strike, the employer should be allowed to fire all of them and hire permanent replacements.

5 Responses to NYC School Bus Strike

  1. There are two somewhat opposing trains of thought.

    1) There should be limited or no government and less laws such that government cannot help bad companies and overpaid workers. This is called free market or anarcho capitalism.

    2) Government has a valid role and that role should be actual interference in markets to help the people instead of of vested interests (companies wealthy enough to lobby).

    The trouble with (1) is that there are a small number of people with vast wealth and if we moved to limited government they would yield all the power. So you would have to equalize the wealth and land at the same time.

    • It is through government that a small group of people with wealth concentrate their power. If you didn’t have government, taxation, and regulation, it would be hard for insiders to use their influence to steal from everyone.

      In a really free market, if your employer is abusive, you find a new job or start a new business. In the present, that doesn’t happen, due to State restriction of the market.

      • If everything was to start from scratch, what would we use as money?

        Would it be gold and silver? Who holds most of the gold at the moment?

        Or would we try to equalize matters and start up a new paper currency?

        In the UK, Royalty owns a lot of land, farms and properties. One Duke owns a lot of prime London real estate.

        The rich will still end up rich and they own a lot of property which they can rent out at whatever price they want.

        What about all the “middle class” people with buy-to-let mortgages that can do no work and just rent out their second, third or fourth houses. The workers can save no money and all their money goes out in rent.

        • Even if you already own a lot of land, you won’t be able to use it efficiently without help from the State. However, the tenants may have a more valid ownership claim than the landlord. In the present, large landowners receive direct and indirect State subsidies.

          With free money, it probably would mean a return to gold and silver. Buy before the crash to preserve your savings. However, people would be free to use whatever they want as money.

          The problem with a new paper currency is that the people who print it still get to steal via inflation.

  2. I found a website yesterday that stated that governments always say they can’t do anything because of THE MARKETS.

    The very next day Nick “student loans” Clegg said they couldn’t do such and such, because companies only invest in the UK because of its membership of the European Union. So if Cleggy and Cameron didn’t anything presumably a whole load of companies would up sticks and leave the UK along with their hoards of cash.

    Well anyway the UK is going downhill. No jobs. North sea oil running out. No manufacturing anymore. Just fraud from the City of London.

    The website pointed out THE MARKET is the same as the rich and Goldman Sachs.

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