Earlier quoted context omitted.
On the other hand, paying living wages to thousands of unnecessary workers is quite expensive, regardless if they are employees or contractors. Unions work on both goals simultaneously, increasing wages but also providing job security to their base, inserting strong restrictions on who can perform certain labors etc. The more employees, the higher the power of the union, it's not like a competitor could spring up and…
But isn't this exactly what you're supposed to do in capitalism? Use your privileged position in economy to earn money (by definition at the expense of other people)? Now, I agree that it's not a very moral position, but we don't expect property owners in SF to keep rents reasonable. They should charge as much as they can, that's the only thing that makes sense from a business perspective!
Capitalism (idealized) is when you use get an advantage by selling superior goods or services, while competing with others, without leveraging any state-given privilege.
We need (even) more capitalism in the US, if anything.