Category Archives: jobs

Regulations of our Government

Posted on by
Reply

Kevin O’Brien of The Plain Dealer has already addressed this particular aspect of an over-regulatory government, so I’ll just quote heavily from his editorial.  It seems our illustrious Labor Secretary, Hilda Solis, is the one who’s at it for our government, this time.  Per Solis, kids aren’t to be allowed to work on the family farm, anymore.  They might catch a blister, poor dears.

It seems Solis’ answer to this problem is to

…prohibit hired workers under 16 from operating almost all power-driven equipment unless they have been “enrolled in a vocational education program in agriculture under a recognized state or local educational authority or in a substantially similar program conducted by a private school.”

So, let’s see: a VoTech program is better equipped to train a minor in operating farm equipment than is the farmer who owns and operates that equipment.  Last I looked, VoTech programs don’t have many tractors, or balers, or plows, or harrows, or….  Those are mostly down on the farm.  On what basis would we expect a school to train the use of farm equipment or tools when they don’t have any?  There’s that Federal government logical thinking.

Solis insists that kids working on the farm have a higher fatality rate than kids working elsewhere (wait—there are kids working?  Where are Solis’ child labor laws?  Certainly, they’re not working in their schools as part-time janitors…).

But as O’Brien points out,

[The kids are] a lot less vulnerable than children who have to walk through a bad neighborhood after their shift at McDonald’s….

Solis goes even further:

…prohibit young people from doing any work that would take them more than six feet above ground level or engaging in any activity that would expose them to “unpredictable animal behavior.”

But tree climbing for recreation is OK—or is government going to intrude into my backyard and ban that, too?  The neighbor’s dog doesn’t like me, either—but he’s pretty predictable.  Never mind that; as O’Brien points out, sometimes you have to work more than six feet off the ground.  Ha lofts in barns, for instance.

As Senator Ben Nelson (D, NE) points out, though, this sort of rule is inimical to the welfare of farming and of rural economies.  Solis’ rule could

…change the structure of family farms and have a negative impact on the education of the next generation of farmers.

This proposed rule is another example of Washington being out of touch with Nebraskans’ values.  The Department of Labor should kill this rule before it destroys important traditions in rural America and hurts the farm economy.

One out of every three jobs in Nebraska is tied to agriculture.  We need to increase opportunities for our family farmers and ranchers to strengthen our rural economies, not threaten them with new, unneeded regulations from Washington.

Of course, Solis could have another class of laborer in mind for these jobs.

As O’Brien describes this from his own childhood, actual learning by the young worker would be lost to such rules:

I learned a tremendous amount about animals in those years, and a fair amount about people. I chased things. I got chased by things. I learned that work — even sweaty, smelly, dusty, tiring work — could be fun.

and

Along the way, I learned to differentiate among things and activities that deserved respect, things and activities that were actually worth fearing and things and activities that were no big deal if you handled them properly.

These are lessons that aren’t available in any school or VoTech program.  These are lessons that only can be learned through doing.

As O’Brien points out, though,

…a little time on the farm would have done Hilda Solis some good. She spooks too easily….

Big Government’s Taxes

Posted on by
Reply

Progressives like to assert that their tax and spend programs are good for job creation and good for jobs, generally.  This actually is a testable claim, and we have an ongoing experiment of the thesis in Illinois.  How’s this working out for the Illini?  The Wall Street Journal has in interim report.

At the start of this year, the Progressives in control of the Illinois state government rammed through a $2 billion tax increase: the corporate tax rate exploded by 30% (the personal income tax was worse, a 67% increase, but that’s for another time).  Naturally this has no effect on jobs or job creation goes the Progressive hypothesis.  It’s almost true for the Big Businesses favored by Illinois’ Big Government.  The Chicago Board of Trade and the Chicago Mercantile Exchange have received from Uncle Patty Quinn’s generosity $85 million in tax breaks if only they’ll keep their jobs in Chicago and not relocate to another state.  Sears Holdings Corp. is the beneficiary of $15 million in tax credits for the same reason.  Santa Quinn has, in rough total, handed out $500 million in goodies to some 80 Big Businesses if only they’ll keep their jobs in Illinois.  That’s actually a relatively small sum, only a bit over six-tenths of one per cent of that $2 billion tax hike.  But it’s not chump change for the companies getting this special dispensation.

And it’s not chump change for all the mom and pops and other small and medium businesses who have to pay all of that tax hike because they can’t afford the Progressives’ vig.  The solution for them?  Hit the bricks.  Or see their friendly neighborhood community organizer.

Did this job-creating and budget-fixing tax rise achieve its purpose?  The Illinois Policy Institute says that over the next 15 years, the revenue lost from all these special corporate tax deals, along with the revenue lost from companies (big and small) departing, will exceed the monies raised from the increase.  And the budget deficit hasn’t gotten any smaller.

On another note, we have this, from Lawrence Lindsey in his 1990 The Growth Experiment: How the New Tax Policy Is Transforming the U.S. Economy:

Politicians who assert their role in directing funds to the “industries of the future” want to play entrepreneur with someone else’s money. They are ill suited to the role. The politician who takes over the direction of capital is quickly revealed as this year’s amateur following last year’s experts.

Hmm….

Government and Innovation

Posted on by
Reply

Government’s role is to create an environment within which men can prosper in accordance with their own efforts and the degree of those efforts.  Thus, legitimate government sets laws that prevent one from cheating another and laws that require each to honor the contracts to which they agreed.  Legitimate governments do very little more than that.  Government does not have, for instance, a legitimate role in determining what those contracts must accomplish, or how they must be structured.  Nor does government have a legitimate role in inuring any of us from the failure of our efforts: it is, in fact, from those failures that our enterprises grow stronger for the next effort.  It is in the fermentation vats of competition, unconstrained by government, that innovation occurs.

Why, then, is what used to be a uniquely American skill of innovation moving apace overseas and no longer occurring here?  Here’s an example of this failure, and it illustrates an answer.  Despite our need to become energy independent, for a range of reasons I’ll not go into here, and despite our Progressives’ push to move away from coal, oil, and gas as the primary source of our energy, nuclear power innovation is moving to the People’s Republic of China, at the behest of American innovators.  In this illustration, I’ll leave aside the question of helping the PRC obtain technological superiority over us (which is troubling in itself).

The Washington Post reports that a startup called TerraPower has developed a nuclear power breakthrough that involves traveling wave reactor technology and this technology’s ability to use depleted uranium to power a nuclear plant for decades without need of refueling or waste removal.  However, instead of looking to deploy this technology in the US, TerraPower, heavily backed by Bill Gates of Microsoft fame, is talking to the PRC government about selling its technology there.  How does this work?

For one thing—for the driving thing—innovators still are human, and humans still can go anywhere they like.  And humans, being humans, are going to go where it’s easiest to follow their dream, easiest to satisfy their own drives and imperatives.  With business, and especially high-tech business, those places are where the conditions conducive to development and growth are most available.

The US’ rules for permitting and environmental studies, especially for nuclear power, and the US’ litigation environment that encourages lawsuits over any perceived slight, whether environmental, social, or something else all serve to drive the costs of bringing innovation from the laboratory into the market to astronomical heights.  Although, in TerraPower’s case, this might be irrelevant: “Current U.S. rules don’t even cover the type of technology TerraPower hopes to use.”

Additionally, the US’ visa rules are outright stupid.  We educate highly talented and motivated engineers and scientists, and then, because they’re aliens, we send them back to their home countries, even if they want to stay—the quotas are too low and for the few allowed, it takes too long for the converted visas to be issued.  Then, getting talented, motivated, already educated—and experienced—foreign engineers and scientists (back) into the US also is a Herculean task, made worse by not having allowed those freshly trained to stay: the quotas are set too low, and the few authorized visas are slow to be issued.  In either case, why should we have quotas at all?  We should welcome these people with open arms, as we did with the German scientists after WWII, who built our space program.

On the other hand, the PRC has programs like “Thousand Foreign Talents” to attract the world’s best and brightest into China.  And they have an active, empirically visible interest in tech and in having an environment conducive to development—and deployment.  While the US is shrinking its satellite and exploration programs and withdrawing from manned space efforts, while hoping for small change from companies like SpaceX (which NASA is in the process of stiffing due to budgetary problems), China is accelerating its programs, including intending to put a man on the moon by 2020—a feat we’ve been too timid to think about trying for 40 years.

As the WaPo concludes

The lesson is clear: The U.S. government needs to be just as aggressive as the Chinese in creating incentives for entrepreneurs and technology start-ups to grow and mature. At a time when the U.S. is downplaying efforts to attract and retain foreign entrepreneurs and flirting with legislation that could slow the pace of digital innovation, it is strangely China that is proving to be more proactive in creating the conditions for innovators to thrive. Bill Gates is one of America’s great entrepreneurial legends. Something feels wrong about seeing him launch a new chapter in his tech career in China and not the U.S.

Hmm….

Joblessness

Posted on by
Reply

Here are some data on Americans and our quests for work.

Financial Times‘ Ed Luce offers some statistics (the article may be behind a paywall):

In December 2007, the US economy employed 146 million people. Four years later, it languishes at 140 million.  At the current rate of job creation it will take another two and a half years to regain 2007 levels—taking the replacement cycle to as much as 78 months….  Even that understates the problem, since in that time the population will have risen by more than 10 million.

and

At the start of the recession, the employment-to-population rate was 62.7 per cent. The rate is now 58.5 per cent….  According to government statistics, if the same number of people were seeking work today as in 2007, the jobless rate would be 11 per cent.

Notice that last.  Here are some back of the envelopment calculations: in 2007, according to the US Census, the working-age population of the US (which I’ve unilaterally defined as men and women between 20 and 64 years old) was a bit shy of 181 million Americans.  Thus, that 4% drop in the employment-to-population rate represents a loss of some 7.25 million Americans from the labor force—7.25 million who have, with the terrible economy we’ve had for the last four years, given up looking for work.  If they still were looking, that’s what would run the “unemployment rate” up to 11 %.

In the last three years, the “official” unemployment rate has run from 7% to as high as 10%, stabilized at around 9% for most of these three years, and last month fell to 8.6%, a number that disguises the foregoing.  In all, some 2 million more Americans—that are still looking—are out of work today than at the start of 2009.

There’s one more interesting statistic.  This one does a better job of measuring the quality of the jobs available: the unemployed and underemployed combined rate is pushing 20 per cent.  This isn’t a number that says an American isn’t getting paid what he wants, or thinks he deserves—none of us are that—this is a number that says Americans don’t have as much work per day as we want—it includes all less than full time workers who want to be full time.

And there’s this from the Democratic National Committee Chairwoman and Congresswoman (D, FL), Debbie Wasserman Schulz in an exchange with Gretchen Carlson:

Carlson: Unemployment has gone up precipitously since [Obama] took office.

Wasserman Schulz: That is simply not true.

Among Luce, Carlson, and Wasserman Schulz, someone has lost track of the situation.

Government-Guaranteed Loans and Taxes

Posted on by
Reply

This is a brief tale of taxes and loans as they apply to American education.

In a time when our governments think the answer to correcting our public education system’s decades-long failure to improve our children’s education, as demonstrated by poor and unimproving standard test scores, is to continue their decades-long practice of throwing our taxpayer money at the system (what was it that Albert Einstein said about doing the same thing repeatedly and expecting different results…?), some of our state governments, and the good citizens therein, are rejecting the idea and doing something different.

As  The Daily Caller reports, in the recent special election in Colorado, the voters overwhelmingly rejected a ballot proposal that would have raised, yet again, taxes earmarked for public schools, when no discernable improvements from those increases were expected (by those taxpayers).

Florida, on the other hand, has been doing something different since the turn of the century: it’s lowered taxes by giving tax credits to businesses that donate to a non-profit  K-12 scholarship program that are equal to those donations.  The scholarships then are awarded to low-income families to help pay their costs in sending their children to private schools selected by those parents.  (Notice that phrase, too: “help pay.”  The families have to commit significant funds of their own; by having their own skin in this game, they have incentive to ensure their children do well in the new school.)

The effect of this Florida program is four-fold: the public schools, now having to compete for students, are doing a better job of teaching the children they retain.  The low-income families get better choices in how to get their children educated.  The state saves money: despite losing $1 in education tax revenues, it actually saves nearly $1.50 because despite the stereotype, it’s cheaper to educate a child in a private school in Florida than it is in a public school.  The local communities come out ahead because a dollar taken in taxes is only about six bits actually spent back into the local community due to the internal friction of the various government agencies each taking their taste of that tax dollar, whereas that same dollar left in the taxpayer’s hands is entirely spent in one form or another.

Now let’s look at government-guaranteed student loans for college (those guarantees, don’t forget, are covered by tax dollars from all of us).  What are these loans used for, and what should they be used for?

This table from The Daily Caller is instructive.

Bachelor's Degrees AwardedLook at this table against the backdrop of the global economic competition in which the United States is engaged.  From business, to resource development, to production, to defense, and everything in between, the United States needs well-trained and -qualified scientists and engineers.  What are our students studying?  Visual and Performing Arts.  Education(!?).  Social Science (how are we doing in this field, by the way?).  What are international students, the students of our competitors, studying?  Engineering.  Physical and Life Sciences.

If we’re going to have a government student loan program (I think we should not, but that’s another story), might it not be a little bit beneficial to target those loans in some way?  How about, if we’re going to commit our tax dollars to covering student loans at all, we at least use the program to encourage our students to study—and to stay with through graduation—the engineering and science, technology, and/or mathematics that will actually do our nation and our society some good, instead of just spotting our unformed (and uninformed) high school graduates the bucks they want simply to follow their bliss?