Projection

Kentucky has decided to take advantage of new Federal Medicaid rules and add a work requirement to those receiving Medicaid payments in order for them to be eligible for continued payments.  Recipients in the typical working age range of 19-64 must do 80 hours—two weeks—of what the State terms “community engagement.”  There are, of course, exceptions for those who cannot work.

As Kentucky’s governor Matt Bevin (R) noted in his tweet about his decision to approve the new rule,

There is dignity associated with earning the value of something that you receive. The vast majority of men and women, able-bodied men and women … they want the dignity associated with being able to earn and have engagement.

Progressive-Democrats are in an uproar over the requirement that people actually work in order to receive government largesse.

Congressman John Yarmuth [D, KY] call[ed] it a “dangerous and irresponsible” decision that will lead to the “financial ruin” for thousands of families that reside in Kentucky.

Of course.  Just like adding a work requirement in the Federal government’s reform of the Aid to Families with Dependent Children (later replaced by Temporary Assistance for Needy Families, which continued the work requirement—until then-President Barack Obama (D) waived the work requirement) dangerously and irresponsibly led to financial ruin for all those hundreds of thousands of families.  Oh, wait—that actually led to the adults in those families not only going to work, but to those families’ increased prosperity, since their earned income was greater than their AFDC/TANF payments.

The Progressive-Democrat is projecting.

 

*The waiver led to an explosion of families on TANF and their increased poverty, thus providing an actual experiment on the outcome of a work requirement.

The Price of Labor

…is also a cost to labor.  Minimum wage mandates took effect at the start of the year in 18 States and in 20 cities.  These mandates have drastically raised the cost to labor.

Late Monday, casual dining chain Red Robin Gourmet Burgers (RRGB) announced that it would eliminate bus boys at 570 restaurant locations, a move that is expected to save the company an estimated $8 million over the course of the coming year. The company’s chief financial officer said the decision was made in order to “address the labor increases we’ve seen.”

Those busboys can thank their respective Progressive-Democratic politicians for the wage increase they can enjoy not having.  They also should remember this largesse in the coming primary season and again this fall.

There’s another cost to labor, one that is far longer lasting, and so far more devastating to us citizens and the economy in which we must operate.  Michael Saltsman, Employment Policies Institute Director, addressed the problems faced by our teenagers and other first-time workers:

I think the loss, as the minimum wage goes up…[is the] hollowing out of entry-level opportunities[.]

Without that entry-level experience—not only in a particular job, but in the nature of having a job, the ethic of work—how will our first-timers get the next-level job?  How, indeed, will they even get any entry-level job when they’re being priced out of the starter market?

A Thought on Student Loans

Education Secretary Betsy DeVos is taking steps to redress the Obama administration travesty of a student loan program, but these can only be interim steps and by themselves are entirely insufficient.

Unfortunately, the student loan programs are entirely dysfunctional and want complete revamping. My high-level suggestions:

  1. student loan discharge only via bankruptcy, no special treatment of these loans
  2. let schools and students write their own loan agreements, including interest rates and payback provisions, without Government interference
  3. hold those schools and students to those agreements
  4. if Government guarantees any student loans, do so IAW the following:
  • interest rates charged must be commensurate with the employability and median first-five-year pay of the major being pursued; higher rates for lower employability and median pay. Higher risk loans should pay higher rates
  • in the event of bankruptcy discharge of a loan, the school floating the loan must completely reimburse the government, NLT the following fiscal quarter, for the taxpayer loss from the bankruptcy discharge.

Good for Workers, Good for Business

Recall the National Labor Relations Board’s case of a couple of years ago, Browning-Ferris Industries.

Browning-Ferris concerned a recycling center staffed by contractors. The original [NLRB] ruling found the contractors were jointly employed by a staffing firm and Browning-Ferris.

This ruling, if allowed to stand (the case also is in the Federal court system) would have allowed contractors like those at Browning-Ferris, McDonald’s, and any other franchise-centered corporation not only to form unions at individual franchises (which they’ve always been able to do), but also to form a grand union across the corporation.

President Donald Trump appointed a couple of folks to the NLRB to fill vacancies created when two ex-President Barack Obama (D) appointees quit in a snit over Trump’s election.  Now the NLRB has voted to overturn that prior NLRB ruling.

This is good for both business and for employees.  It’s good for business because modern unions have devolved into extortion rackets that threaten a business’ ability to exist through crippling strikes unless the unions get pay and benefits that they demand, even when those things cost more in their per-employee aggregate than the employee’s work is worth.

It’s good for the workers because it means, with labor costs allowed to match the value of the work done, labor won’t be replaced by automation that’s cheaper than the union-elevated labor costs.  Jobs will be preserved, and more hiring will occur.  It’s also good for workers because it frees them to negotiate their own wage and benefit package instead of being dragooned into whatever a union might impose on them.