Category Archives: jobs

The Deficit Has A Silver Lining?

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Dr Alan Blinder, Princeton University Professor of Economics and Public Affairs, had some thoughts on this.  His piece is fundamentally optimistic, but a few of his remarks jumped out at me.

Congress and the president have managed to agree on several measures that reduce the projected 10-year deficit considerably.

Reduced the 10-year deficit.  He writes of this as if it’s a good thing.  He writes of this as though that continued 10-year deficit, representing as it does an enormous expansion of an already ruinous debt, is a good thing.

Meanwhile, Republicans are talking far less menacingly about either shutting the government down or precipitating a debt crisis.

For which cynical straw man he declines to provide a single quote from a Republican—or Conservative—wherein such a one ever talked about shutting down the government or precipitating a debt crisis in recent history, other than in the context of Progressives manufacturing such things so they can decry them.

That law [the Budget Control Act of 2011] created land mines like the fiscal cliff, but it also cut spending by over $1.9 trillion once you include the associated interest savings, as you should.  (Here and elsewhere, I use the 10-year budget window 2014-2023 and recent estimates from the widely respected Center on Budget and Policy Priorities.)  That was all spending cuts, no tax increases.

Here Blinder is simply being disingenuous.  There were no spending cuts in that Act.  A reduction in the rate of spending increase is still a spending increase.  A Professor of Economics, even one at Princeton, knows that.

Then came the New Year’s Day agreement that averted the cliff. The headline number then was about $600 billion in tax increases.  But if you add in the spending cuts and the associated decrease in debt service, it came to another $850 billion or so.

See above.  And he’s exaggerating the magnitude of the spending increase reduction.

But imagine that our legislators agree instead on a smarter package of spending cuts and revenue raisers that amounts to the same amount of money [as the present sequester cuts].  After all, it’s only about 0.6% of GDP.  Then we’ll have achieved the $4 trillion target.  The Center on Budget and Policy Priorities estimates that doing so would be enough to stabilize the debt-to-GDP ratio at about 73%, which is a sensible goal for now.

There are a couple of things here.  “Cuts and revenue raisers” that achieve the same degree of…something.  Serious cuts in Federal spending would get the government out of the way of the economy, and its recovery—its enthusiastic performance—would raise plenty of revenue for the government, more so than it’s collecting now.  But Blinder and his fellow Progressives, with these demands for more taxes as the only possible revenue raisers are simply demonstrating their contempt for a free market and the wisdom of the individual Americans participating in it, preferring instead an economy centrally directed by Know Better Progressives.

The other thing is that stable debt-to-GDP at 73% nonsense.  This is an amazing thing even for a Princeton Professor to say.  There’s nothing at all stable about such a debt level.

Some of this “cost control” [in his claimed slowing rise in the cost of health care] is due to the weak economy: Hard times lead people to postpone or cancel some medical care.  But health-care inflation began to fall years before the recession began, which suggests that deeper forces are at work.  If we can somehow slow health-care costs to the rate of GDP growth, our long-run budget problem is basically solved.

On the effectiveness of President Barack Obama’s poor economy in holding down cost increases, well NSS.  “If we can somehow slow health-care costs…,” well the answer here is obvious—let a free market work its will in a competitive environment.  But, such an answer truly is not obvious to one who disdains the free market and that wisdom.

…fixation on reducing the budget deficit, to the exclusion of all other national goals, seems strangely anachronistic.  The nation has other priorities, too—such as faster growth and more jobs.

This also is an amazing thing.  The nation does have as critical economic and security imperatives faster growth and more jobs.  But these are not possible to achieve until the budget deficit is eliminated and the debt it drives reduced.

Obama’s Health “Insurance” Hiring Disincentives

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Here’s the Obama Job Sharing Plan.  As a result of the looming rules of President Barack Obama’s Obamacare,

a local McDonalds has hired employees to operate the cash register or flip burgers for 20 hours a week and then the workers head to the nearby Burger King or Wendy’s to log another 20 hours. Other employees take the opposite shifts.

That’s because 30 hours counts as a full-time employee, and low-margin industries can’t afford the added costs of Obamacare insurance for full-timers.  Holding the employees further under that threshold—to 20 hours, for instance—gives those part-timers room to get another part-time job and so to have a full week’s worth of work and income.  Just with no employer-provided health insurance.  (Whether this is good or bad is a separate post; I’ll just say here that the “good” of it is far from established.) This is not atypical.

[Obamacare] requires firms with 50 or more “full-time equivalent workers” to offer health plans to employees who work more than 30 hours a week.  (The law says “equivalent” because two 15 hour a week workers equal one full-time worker.)  Employers that pass the 50-employee threshold and don’t offer insurance face a $2,000 penalty for each uncovered worker beyond 30 employees.  So by hiring the 50th worker, the firm pays a penalty on the previous 20 as well.  [Emphasis added]

That’s a $40,000 penalty for hiring the 50th worker.  The WSJ lays it out starkly:

If a company with 50 employees hires a new worker for $12 an hour for 29 hours a week, there is no health insurance requirement.  But suppose that worker moves to 30 hours a week.  This triggers the $2,000 federal penalty.  So to get 50 more hours of work a year from that employee, the extra cost to the employer rises to about $52 an hour—the $12 salary and the Obamacare tax of what works out to be $40 an hour.

That encourages hiring, all right.

There are other implications.

Businesses that hire young and lower-skilled workers are also starting to put a ceiling on the work week of below 30 hours. These firms are…”29ers.”  Part-time workers don’t have to be offered insurance under Obamacare.

These young and low-skilled workers are at the point of their careers where they’re starting to accumulate the work experience and habits that can lead to better jobs at higher pay.  Only they’re not accumulating them at the rate they otherwise could.  Which puts them well behind the job competition power curve compared to those who’ve managed that jump.

So much for upward mobility in the Obama régime.

Also with the Obama Job Sharing Plan, health insurance accessibility, for good or ill, is actively reduced.

Being Moral is a Firing Offense

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Of course it is.  Twyla DeVito, a bartender at a Shelby, OH, American Legion establishment, was fired for calling the police about a drunken patron who was leaving the bar in his vehicle.  She had this:

“I came into work, he was already there, pretty much hammered. … He ordered a beer, I gave it to him, and then I started to try to slow it down, serving him.”
She said that when he went to leave, she knew he was not in a state to drive.
“I called the police and said, ‘We have a very drunk person leaving the bar. He is going to kill someone or himself,'” [she said.]

The police caught up with him, and his breathalyzer test came out 0.167—twice the legal limit.  After that, Mic Hummard, her boss, fired her, saying

…it’s bad for business to have a bartender that will call the cops.  If every patron who comes in here has to worry about the cops waiting for them when they leave, the place would be empty.

Amazingly, he added that while DeVito did the right thing morally, she did not do the right thing for the business.

More Government Interference

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…and more overreach by one branch of government.  James Bovard had this in a recent Wall Street Journal piece.

In 1989, the [Equal Employment Opportunity Commission] sued Carolina Freight Carrier Corp of Hollywood, FL, for refusing to hire as a truck driver a Hispanic man who had multiple arrests and had served 18 months in prison for larceny.  The EEOC argued that the only legitimate qualification for the job was the ability to operate a tractor trailer.

US District Judge Jose Alejandro Gonzalez Jr, in ruling against the agency, said: “EEOC’s position that minorities should be held to lower standards is an insult to millions of honest Hispanics. Obviously a rule refusing honest employment to convicted applicants is going to have a disparate impact upon thieves.”

Despite this crystalline ruling of long standing, the EEOC is persisting.

Last April, the agency unveiled its “Enforcement Guidance on the Consideration of arrest and Conviction Records in Employment Decisions,” declaring that “criminal record exclusions have a disparate impact based on race and national origin.”

Thus,

If a background check discloses a criminal offense, the EEOC expects a company to do an…”individualized assessment” that will somehow prove that it has a “business necessity” not to hire the ex-offender (or that his offense disqualifies him for a specific job).  Former EEOC General Counsel Donald Livingston, in testimony in December to the US Commission on Civil Rights, warned that employers could be considered guilty of “race discrimination if they choose law abiding applicants over applicants with criminal convictions” unless they conduct a comprehensive analysis of the ex-offender’s recent life history.

Just one more example of this administration’s disregard for the other two branches of our Federal government.  And of our individual liberties.

Unions and Elections

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Who says unions don’t try to influence the outcomes of elections—at the ballot box itself, not via campaigning in a run-up to an election?

The image below, from a Wall Street Journal article about a Boeing engineers union contract election shows the degree to which a union will go to tell its members how to vote.