Economics

"Get the government's foot off the throats of private employers"

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At Forbes, legal scholar Richard Epstein has some simple advice for these troubled economic times—deregulate labor markets:

As libertarians know, government sages should first direct their fire to reduce market drag by—shudder!—deregulation. Yet on a matter that intersects health and labor, Democratic health care reform proposals predictably protect collective bargaining rights in all health care markets, thereby perpetuating highly inefficient labor monopolies.

That interventionist mindset, writ large, is killing labor markets today. This past July, a third 70-cent increase has raised the minimum wage from $5.15 to $7.25 per hour in just over two-years. Why is anyone surprised that this 40%-plus increase caused a current sharp increase in teenage unemployment that hits minority males especially hard?…

Far worse, just keeping the misguided Employee Free Choice Act (EFCA) on the legislative agenda sets up a massive disincentive for firms to hire new workers. Who wants to expand a workforce in the face of the potential double whammy of a card check and compulsory contract arbitration, capable of sending any firm into bankruptcy?

Read the rest here.

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  1. Damon Root and “legal scholar” Richard Epstein are obviously absolute idiots. One of the main long-term reasons for high unemp. is – shock! – a large number of low-skilled workers, most of whom are here illegally.

    Epstein is just a hack and not a real economist. If he were, he’d acknowledge that. And, if he actually cared about his fellow citizens, he’d call instead to have our laws enforced.

    Subscribe to my feed or search my thousands of posts about this issue to find out all the things Reason won’t tell you. In many cases, you’ll find out from me what Reason only covers days or months later.

    P.S. In case anyone replies to this, their responses will almost assuredly be ad homs, thereby conceding my points and showing the childish, anti-intellectual nature of libertarians. Dozens of comments here have shown that the phrase “fascist libertarian” isn’t an oxymoron.

    1. Damon Root and “legal scholar” Richard Epstein are obviously absolute idiots.

      In case anyone replies to this, their responses will almost assuredly be ad homs, thereby conceding my points and showing the childish, anti-intellectual nature of libertarians.

      It’s not an ad hominem to point out the fact you’re a complete hypocrite.

    2. LoneWacko, you really need some help. A regular psychiatrist couldn’t even help you. You need to go to, like, Vienna or something. You know what I mean? You need to get involved at the university level, like where Freud studied, and have all those people looking at you and checking up on you. That’s the kind of help you need. Not the once-a-week for eighty bucks, no. You need a team. A team of psychiatrists working around the clock, thinking about you, having conferences, observing you like the way they did with the elephant man. That’s what I’m talking about, because that’s the only way you’re going to get better.

    3. “In case anyone replies to this, their responses will almost assuredly be ad homs, thereby conceding my points”

      You keep writing this.

      Look.

      If someone replies with an ad hominem, they may very well be avoiding your points. But it does not necessarily logically follow that they are conceding them. There’s no “thereby” at work here.

      The logical fallacy that’s on display here is actually yours: It’s called poisoning the well.

    4. For just one example of my name in action, I covered the bogus Rush Limbaugh quotes back in June, and in a comment here in September I suggested it as a good thing for Reason to look into. Reason has only discussed those quotes AFAIK recently, around the same time as most everyone else discovered them for the first time.

      1. I will never click your self-serving links. You are trying to drive traffic to your page with which you hope to earn income. Gesticulate all you want; your game is obvious. And lame.

      2. Listen, fuckface, Anonymity Guy generates more relevant comments than you. For Cthulhu’s sake, Ugg guy generates more relevant and readable shit that you. And I am far more likely to click one of their links than one of yours. I cannot imagine why you keep coming here when all we do is swear at you and ignore your links. Seriously, man, go somewhere else. It will make both you and us happier.

      3. Maybe if you post your thoughts here instead of inviting me to click on some blind link from someone widely reviled here, I might look at what you’ve written and see if I agree or not.

        But there’s no way I’m going to visit your website, asshole.

        If you want to earn a reputation here of being someone with substantive POVs, fucking state those POVs here.

      4. Nobody gave a fuck about those quotes in June because, at that time, they were just business as usual liberal BS from a small time book and Wikipaedia. They did not become a story until the MSM grabbed them and ran with them recently without checking their validity. That you don’t see that the real story here was the MSM’s rush to latch on to BS quotes, not that idiots had previously fabricated BS, shows your usual lack of news judgement and exagerated sense of self importance once again. Now, run along and go blame some illegals for something.

  2. LoneWacko, you don’t even try anymore. You are kind of like an idiot who keeps pressing the same button. Fuck along, now.

    1. Yeah. His performance art has really gone down hill. He is like some aging hair band where everyone is on herione. Pitiful.

    2. Either that or his computer has some sort of random number generator subroutine going that just spews these comments in regardless of topic.

  3. Epstein says:

    Yet look as you may, none of the administration’s current champions of job creation will lift a finger to take the heavy foot of Uncle Sam off the throats off the private employers, who are the only persons who can sustain job growth.

    Discussing FED chairman Bernanke…
    “It was a rather sobering meeting,” Sen. Richard Shelby, an Alabama Republican, said in a live interview. “I said…’Could this be a jobless recovery?’…and he said it could be,” Shelby said.
    With Romer and vast punditry parroting the same point as Bernanke, Epstein’s point isn’t a difficult one to grasp.

    1. Whoops, it isn’t a difficult one to grasp, LoneWhacko excluded. And statists. And idealists. (Same thing really.)

  4. Aren’t they looking into LOWERING the minimum wage in Colorado? I never thought I would see such a thing. But maybe if CO leads the way and the sky doesn’t fall, after all…

  5. The whole point of a union is to organize one group of workers to leverage against a company and get higher wages and benefits. If you raise wages and benefits, the cost per worker goes up and companies hire fewer workers. Thus, the whole point of a union is really to give benefits to existing workers at the expense of future hires. Given that fact, it is pretty much impossible to pay off unions and also do much to increase employment. Since the Democrats run things and always payoff unions before they do anything else, unemployment won’t be going down anytime soon.

    1. John, unemployment might go down. Never underestimate the ability of even a slightly free market to work around statist fuckups.

      But if unemployment does going down from the current sky-high levels, it certainly won’t be because of what the statist fucks running Congress and the White House have done, even when they inevitably try to take credit.

    2. “The whole point of a union is to organize one group of workers to leverage against a company and get higher wages and benefits. If you raise wages and benefits, the cost per worker goes up and companies hire fewer workers. Thus, the whole point of a union is really to give benefits to existing workers at the expense of future hires.”

      Not necessarily. To a great extent this is result of the way our labor laws are written. We could have had a system in which unions compete with one another to offer the best deals for employers in exchange for the provision of their members’ labor — effectively serving as labor contractors. This would improve compensation over what an individual worker could bargain for, but not excessively so. It would also encourage innovation and competition based on quality of work.

      Instead, our labor law is premised on two principles that effectively give a single union monopoly rights over labor for a given employer: exclusive representation and the obligation to negotiate. Once “recognized,” a union has the exclusive right to bargain with the employer and need not fear competition from rival unions. And the employer is obligated to negotiate with the union over any term of employment. This gives a union an cverwhelming strength far beyond mere leverage through numbers.

      This is why unions have such a negative impact on labor markets…it’s great for union members but bad for everyone else. Just imagine how much higher your phone bill would be, and how worse the service would be, if one provider had exclusive access to you, and you were obligated by law to purchase service from it.

  6. My husband and I requested a SNAP Food credit increase, we’ve been turned down twice. A week ago we received notice that our account would be changed from $102 a month to $101. I see this as a warning to stay quiet. ( He’s type 2 diabetic and we live on SSI). Which would you prefer: An extra $100 for dietic food, or $180,000 a month for Hospital costs if or when John has a Diabetic blackout or slips into a Coma? You already pay for his SSI and VA, so your decision. Have you ever tried eating healthy nutritious meals with only $25 a week for 2 people? If Obama wants to prevent complications associated with diabeties, obesity, and other ailments, wouldn’t it make sense to issue specified food vouchers/ Dietic foods/Care boxes to VA clinics,Food pantries and other institutions that address the needs of Low income Americans? The Government Commodities
    ( often delivered to Non Profit Organizations) are extremely high in Sodium and Carbs. I have no choice, however; because of the high demand, I’m only allowed to visit the foodpantry once a month, so it’s that or go hungry.
    Worst of all, not ONE version of the Healthcare proposals include tax breaks or incentives to encourage responsible, healthy lifestyles: Therefore, Costs will skyrocket, and John and I will continue to suffer. Please tell our story. Tell DHS to stop the mindgames against diabetics who are only trying to feed themselves properly.

    1. Get. A. Job. I work with people like you every day, who spend all their time telling me how hard life is – then they go home and take a nap.

      Get some exercise, even if only a little at first. Strengthen yourself, become productive in some way, and stop whining. Please.

  7. You guys in favor of the labor regulation saying you can’t employ a 6 year old for 12 hours a day in a factory? Just wonderin.

    1. That’s up to the six year old’s parents. Six year olds can perform work, and for generations have performed light work on the farm. It happens today all over the world. You might be eating imported vegetables or wearing footwear made in part by six years olds. Does that bother you? Just wonderin.

      1. Yes it does.

        Do you guys really think the weekend would exist without progressive labor policies?

        1. STFU Tony. Do you honestly think everyone would be out hiring six year olds and yuppies would be sending their little brats to the mines if only the law didn’t prevent it?
          MOreover, no one is talking about repealing child labor laws. At least make some attempt to troll about the topic.

          1. Why do you tell me to STFU then ask me a question?

            I’m saying that prior to progressive labor policies there are children working in factories and less time off for workers. I’m just asking how far down the road to deregulation of labor do you guys want to go, and if there is a line to be drawn somewhere, what logical reason exists for the line to be drawn at that point?

            1. “I’m saying that prior to progressive labor policies there are children working in factories and less time off for workers.”

              Liar. I just wrote to you that long before progressivism existed people worked LESS hours, and even amid ‘progressive’ regimes today children can and do work long hours in factories and on farms. You’re just channeling a Zinn-centric history now.

              As for the line to be drawn? The line to be drawn is the same one that it ever was. The same one that rational self-evident logic dictates: Obvious and provable harm.

              Is there a victim? If there is no victim, there is no crime.

              The line to be drawn is when and where workers are being stolen from, injured, poisoned, or the like.

              Having your feelings hurt doesn’t count. Nor does wishing you had a better job. Don’t like the job you are doing? Find another. Don’t like your pay? Find better. Unemployable? Improve yourself, or use your own ingenuity and drive to start your own idea. No jobs in your area? Move to where the work is. Vote with your feet. Do something.

            2. Taking credit for ongoing progress, and then claiming that progressives caused said progress, is confusing correlation with causation.

          2. Actually, John, I am in favor of repealing child labor laws, so long as no child is coerced into working.

            I have listened to my teenage daughter bitch about not being able to earn money to buy stuff she wants because the government nannies think they know better than her whether she would benefit from a job.

        2. A weekend is a meaningless abstraction, and a vast sweep of humanity never has a day off–many of them by full willing choice.

          You aren’t making a real point, or if you are you are doing so timidly. Step right up and champion your ideas.

          As for time off of work, the prime reason to accumulate wealth is to afford leisure. Now we can argue what and how leisure is defined, but if your contention is that we work too long and would work more without progressives, let me remind you that I work until May of each year to pay for progressive government. That’s 5 months of leisure time that I *don’t* have. Let me also remind you that in the heydey of early commerce in towns like Bruges, people often worked less hours than we do today, and even a cursory reading of that economic time will show you it was no bastion of progressivism. We work longer and harder today because of too many distortions and hands in the till, so to speak, such as funding progressive idealism all over the place. My insurance policy pays for others’ smoking habits, drinking and drug remediation programs, et cetera, and that’s in place because of progressivism entrenched at the state government level alone. Surely this will *vanish* with a federal reform, right?

          I think the point isn’t that progressivism saves children so much as that progressivism is a way to use government to do what one should do themselves or in common with other like minded people using the power of the purse. And no, forcing me to fund your chosen pet project is *not* a valid definition of “in common with like minded people”.

          1. Yes, I want to hire 6 year olds for my widget factory. Even though their productivity will be nearly non-existent. I shall not pay them minimum wage, either! Mwah hah hah ha!

            1. If you start them off early enough, you can injure them grievously before they’ve learned to read or write, then its up to you to fill out the incident form for them. Problem solved.

          2. No, the prime reason for work is to be able to buy stuff, including leisure, with some people getting the additional benefit of enjoying that work.

            If we had robots that produced everything people needed to enjoy a comfortable lifestyle, some people would still work.

        3. Yes. The weekend, the end of child labor, etc. were well on their way to being the norm when laws were passed to catch up with what was happening in the marketplace.

        4. Yes, some people would work 5 day weeks without government intervention into labor markets. Some would work 4 day weeks. A whole lot fewer would involuntarily work zero day weeks because no one will employ them due to minimum wage and other braindead progressive shit.

          And some people would work much harder, and get paid much more, without all this fucking government interference.

          So a big “fuck you” to progressives and their misguided attempts to “help” people by fucking up their lives and making them poorer.

        5. Do you guys really think the weekend would exist without progressive labor policies?

          What, the bible is a manual of progressive labor policies?

          The long and short of it is, we have the amount of leisure time that we do because of capitalism raising the marginal productivity of labor. Go tell some coolie in North Korea how the evil capitalists make us all work about half as many hours as they do.

          -jcr

    2. I am, since 6 year-olds are incapable of consent.

      1. Well, 8 year olds are not. I took over 25 houses of my older brothers paper route when I was 8, I got up before sunrise, on my own 7 days a week for over two years increasing to over 100 houses before I was 10.

        All day long I listen to people give me excuses why they can’t work. My legs hurt. My back aches. I’m only four.

        1. “not incapable of consent”, that is.

        2. Thank you. As someone who was also working before 10, I appreciate your comments. Before I was 10, I’d been a soda-can collector, a lawn mower, a golf caddy (I was too small for those big bags actually, but I was insistent), and had a paper route. My buddy and I–my first business partner actually–took the paper routes that no one else wanted and doubled up on them, ultimately accumulating over a hundred houses on the most circuitous route around the town one could ride. And you know what? We kicked ass at it. It was great training for life.
          I was punching a timecard by age 14 at a gas station (thank you Bob’s Sunoco Service), managing it part-time by 15.
          Wankers these days are lucky to swing a hammer before building their kids’ doghouse.

          Oh, I forgot the key phrase in your phrase: On your own.

          When I was 22 I broke my arm away from work and lost my job. I was broke, and for a time I believed I was unemployable. I was living on potatoes and cream-of-wheat, and basically surfing my friends’ couches, not paying rent. I received advice from all sides to go on public assistance and start receiving checks. Fuck that. Instead I went out there, and armed with some undeniable confidence that I salvaged from the pit of despair, I cast aside the useless/progressive/democrat inside of me, walked into several businesses and politely told them that arm-cast or not they would be idiots not to hire me, and got gired at three jobs that day. I worked, then when the cast came off, I worked harder. I kept that three-job pace for the next couple of years and paid back a lot of goodwill. I rarely had a day off and I paid off all my medical bills with NO assistance. I never took a slim dime of your public money. I never will.

          Living upright isn’t hard, despite what the progressives who heap victimhood with everything they say and think.

        3. Compare the dangers of a paper route with the dangers of a 19th-century textile mill, and tell me again that an 8-year old can understand and consent to the risks.

          1. Compare the dangers of a 19th century paper mill with the danger of starving to death in the subsistence farming trade.

            There’s a reason why people streamed into the cities to work in factories. Of course the working conditions were appalling by today’s standards, and you can thank capitalism for making today’s standards possible.

            -jcr

      2. Really? Never saw a 6 year old running a lemonade stand or doing a garage sale, on their own and without adult prompting?

        Cause my 6 year old did both, and had a blast.

    3. My wife was employed for more than 12 hours a day working without explicit pay from her father from an early age, resulting in a work ethic that has caused her to pull in annual income well in excess of six figures.

      Are you contending that she is worse off for that experience?

      Are you contending that I am worse off?

      1. And are you contending that her patients, many of whom adore her because she has turned their lives around, or in some cases saved their lives, due to the surgeries she performed on them, are also worse off?

        1. Dude, you’re talking to yourself.

  8. I just sent this email to my Congressional Representative, Harry Mitchell (D-Arizona):

    In your email to me you state:

    “This week, I introduced the Fire Grants Reauthorization Act of 2009, H.R. 3791, to authorize and fund programs that provide critical resources to fire departments in Arizona and across the country. This bill would provide crucial support to fire departments throughout Arizona and the nation at a time when many cities and towns are facing major budget shortfalls and cuts in services.”

    …As if the increase in funding you are trying to authorize will not be coming out of taxpayer’s wallets that are already overtaxed? The reason cities and towns are facing major budget shortfalls is because of the lack of viable economic activity and resultant lower tax revenues. Cuts in services is the logical outcome, but you propose further increases in taxation? Why not try cutting bureaucratic bloat, Mr. Mitchell? Why not try removing the government boot from the throat of small businesses and taxpayers, Mr. Mitchell?

    You’re exhibiting the same sort of fiscal thinking that got America into this mess in the first place. You’re idealism is not helping, and good intentions are irrelevant if they result in bad outcomes.

    I’m fairly confident it will be dumped in the loony bin along with all the others who disagree with the enlightened progressivism that is the modern Democrat Party.

    Harry Mitchell is a guy who, during the run up to his election, allowed security personnel to remove Code Pink and other antiwar Democrats from a public gathering that he was attending. A Democrat gagging Democrats, what a victory for Democracy.

  9. Diabetic who posted at 4:33–

    why don’t you and your shiftless husband get jobs? Then you can spend whatever you want on food and stop complaining that other people won’t give you enough money.

  10. David Axelrod, assures us that “all additional potential strategies for accelerating job creation” are on the table.

    Draft in 3, 2, 1, ….

  11. # Tony|10.16.09 @ 4:41PM|#

    # Do you guys really think the weekend
    # would exist without progressive labor
    # policies?

    What’s a “weekend”? I haven’t had one of those in ages.

    1. Exactly as I replied to him. For a large part of humanity, the weekend doesn’t exist, and by their own choice and consent.

  12. Prof. Epstein is right. But first, let’s remove the prohibitions on strikes. I have a feeling he’d not be so excited about that.

  13. Far worse, just keeping the misguided Employee Free Choice Act (EFCA) on the legislative agenda sets up a massive disincentive for firms to hire new workers. Who wants to expand a workforce in the face of the potential double whammy of a card check and compulsory contract arbitration, capable of sending any firm into bankruptcy?

    And, since even a cursory examination of voting records reveals that blacks voted for Obama and other Democrats pushing card check by overwhelming numbers (I believe I read blacks voted for Obama by a 95-5 ratio), that would give savvy employers yet another reason to not employ black teenagers above and beyond the minimum wage, since that would increase the likelihood that under card check the workforce would become unionized.

  14. Freeing the labor market is half of a solution. The other half would be to free up the capital market. It’s far too difficult and expensive to sell shares in a small business.

    There are trillions of dollars held in massive mutual funds, earning below-inflation returns, that could be put to far better use by individual investing in local businesses, managed by people they know personally.

    -jcr

  15. Gee, it’s not as if something else happened during the same time… say, perhaps, a massive banking and real estate bubble resulting in arguably the worst economic crisis since the Great Depression?

    Nah. Couldn’t be that. It’s not as if teen unemployment suffered in the 2001 recession despite no increase in the minimum wage between 1997 and 2007… OH WAIT, IT DID SUFFER. http://www.msnbc.msn.com/id/23694320/

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