The objective of labor unions is to obtain higher wages for their members. They just keep pushing wages up, up, and up.
What and how the economist thinks:
This statement makes me think about a seller of a good. Many people agree that the seller wants to keep pushing the price higher. But if the seller was to do this, he or she wouldn’t sell anything. Imagine that there is a downward-sloping demand curve that intersects the price (vertical) axis at \($40\) per unit. Now think of the seller charging a price of \($20\) per unit. Can he sell some units of the good? Yes. Can he sell some units of the good at \($30\) per unit? Yes. What about at \($40\) per unit? No. At \($40,\) the quantity demanded of the good is zero. So, the seller who wanted to keep pushing price continually up would find that at some point, no one would want to buy the good.
Now consider a labor union. The labor union faces a down ward sloping demand curve for its members’ labor. Now suppose the demand curve for this labor intersects the wage rate (vertical) axis at \($50\) an hour. Will some union labor be demanded at a wage rate of \($20\) an hour? Yes. What about at \($30\) an hour? Yes, again, and the same holds for \($40\) an hour. But once the wage rate rises to \($50\) an hour, the quantity demanded of labor falls to zero. No employer will be willing to hire members of the labor union once wages reach \($50\) an hour.

Let’s reconsider the statement that the person made: “The objective of labor unions is to obtain higher wages for their members. They just keep pushing wages up, up, and up.” Well, it might be the objective of labor unions to obtain higher wages for their members, but not at the cost of reducing the number of working labor union members to zero.
What the non-economist often forgets is that there are often trade-offs to consider in economics. The seller wants higher prices, but not if higher prices mean that he can’t sell his goods anymore.
The labor union wants higher wage rates, but not if higher wage rates mean that no firm is willing and able to hire its labor.
Think of other trade-offs. A person might say that she wants to get into better shape and eat better, but not if it means that she has to give up everything that is enjoyable in life. A person may say that she wants a high-paying job, but not if it means she has to work 80 hours a week, 50 weeks a year.
Economists do not often talk in terms of extremes. An economist wouldn’t say, for instance, it is important to become as physically strong as you can. Nor would an economist say that it is important for society to achieve zero pollution. Moreover, why doesn’t the economist talk in terms of extremes? This is simply because she realizes there are often trade-offs to consider.
Questions:

“You should always study as hard as you can, eat as well as you can, and exercise as much as you can.” Would the economist agree with the sentiments expressed in this statement? Explain your answer.