Category Archives: jobs

Democrats and Regulation

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Uber is successful in competing with the established taxi industry, and New York City Mayer Bill de Blasio (D) is all upset about it. He wants to freeze Uber’s (and other ad hoc rides-for-hire companies’) growth until he can figure out how to regulate them:

[W]e support a short pause in the rapid increase of for-hire vehicles to make sure that the future growth of this industry lives up to the policies and principles we set out as a city.

“Short pause.” Sure. He supported his argument in that piece by citing other jurisdictions where Uber had resisted…being over-regulated.

Hillary Clinton is his BFF on this:

while the “gig economy” may be “exciting” and “unleashing innovation,” “it is also raising hard questions about workplace protections and what a good job will look like in the future.”

Because. Just because. It exists; it has to be regulated.

Democrats abhor anything that’s not under their regulation, not under their control. Americans just are too stupid to see to their own affairs without Know Betters instructing us. And our Know Betters are the only ones qualified to define “what a good job will look like in the future.”

Update: de Blasio seems to have recognized the error of his ways. For now.  Clinton has not.

An Excess Profits Tax

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In 1917, Progressive icon Woodrow Wilson instigated an excess profits tax running from 20%-60% because, of course, the Progressive knew better how American business owners should spend their money than did the Americans who’d actually earned it through their businesses.

During the Great Depression, Democrat (and Progressive) icon Franklin Roosevelt instigated two excess profits taxes while openly slandering American businessmen as being on a capital strike: Roosevelt actually accused businesses of refusing to spend—at rates satisfactory to the Democrat (and Progressive)—the profits they’d earned.

Now we get the proud early 20th Century Progressive, Hillary Clinton, with her proposal for a “tax credit…to encourage more businesses to offer profit-sharing to their workers.”

Progressives still claim to Know Better what American business owners should do with their money than those business owners who did the work to earn that money. Progressives now also claim to Know Better what labor agreements are fit to be negotiated between employee and employer than those employees and employers—American citizens.

Now, the Progressive wants to foist tax credit onto us, to “encourage” businesses to spend their excess profits—her definition—because, of course, she Knows Better.

She also knows full well that with a tax credit, she’s intends to force all of us to pay a tax on a business’ “excess profits.” She knows full well where the money must come from in order to pay that “credit:” from higher taxes or more borrowing.

She closed her proposal with this bit:

I really think our corporations are missing a big bet. Because credible studies prove that profit-sharing with your employees is good for the employees, good for the businesses, good for the economy. I want to incentivize more companies to do just that.

Never mind that businesses are in the business to make money, not to serve as privately funded, government mandated jobs welfare programs. Never mind that in a competitive—that is to say, a free—market economy, businesses have to compete for employees as well as for customers. Never mind that the incentives are present in a free market economy for businesses to get the most out of their employees.

And so never mind that to the extent “credible studies” are right about the efficacy of profit sharing, in a competitive, free market economy businesses already would have profit-sharing plans.

Oh, wait, they’re just not set up in a way that suits this Progressive. The businesses are missing her bet. And so she demands that we all pay.

As an aside, some homework: crunch some numbers, and see whether a $750 credit for a $5,000 profit-sharing payout makes any sort of sense for a company laboring under the US’ highest corporate tax rate in the world—35%—on all profit, “excess” or not. See whether Clinton has any clue at all.

Anything for a Fee

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The American Law Institute periodically issues “restatements” that attempt to codify the common law—but also shift the law in the direction the institute wants it to go.

Reason enough to distrust this gang.

That’s nothing, though, compared with this:

The institute’s restatement defines the tort of battery as any contact with another person that “offends a reasonable sense of personal dignity” or—the new addition—contact that is highly offensive to another person’s “unusually sensitive sense of personal dignity, and the actor knows that the contact will be highly offensive to the other.”

Aside from the blatant assault on individual liberty this thing represents, it’s an insult to Americans everywhere: it says we’re all such special snowflakes that it’s unreasonable to expect us to suffer the bumps and bruises of human interaction without mumsy coming to the rescue. For a fee.

My sense of personal dignity is unusually sensitive to the pronouncements of the ALI—and being such highly educated and well informed persons, of course they know this.

Do I have a case? Of course not: the ALI has its own unusual sensitivity to mere plebes demurring from their pronouncements. But they’d enjoy the fee.

An Argument for Positive Immigration Flows

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James Pethokoukis, writing in a different context, presented evidence in his AEIdeas piece for us doing better with our immigration policies. First, see the graph below, with particular attention to the “Increases in the workforce (labor inputs)” part of the bars.LaborProductivityAndImmigration_BetterVersion

Pethokoukis’ argument centered on Republican Presidential candidate Jeb Bush’s promise to work toward a 4% GDP growth annual rate if he’s elected; Pethokoukis argued that would be hard to achieve because of shortfalls in the availability of actual laborers.

[A]bout half of US growth in the postwar era has come from higher productivity, and half from a growing labor force. But American society is getting older and working less. Given much slower labor force growth, much higher productivity is needed to make up the difference. If productivity growth just stays at its postwar average—and it’s been much slower lately—the economy’s growth potential is much lower than in the past. As economics blogger Bill McBride writes, “Right now, due to demographics, 2 percent GDP growth is the new 4 percent.”

That’s the evidence and the argument. Pethokoukis and McBride based their argument regarding demographics on birth rates. The fact is, though, birth rates aren’t the only source of new labor. Immigration not only would fill the gap; immigrants would do so promptly: they’re already wanting in (and 11 million of them are already here awaiting some mechanism to let them come out of the shadows and be fully productive—for the US).

We need to quit messing around, and find a way to strictly secure our borders while making it far easier than it is now for immigrants to enter our nation legally (which, incidentally, would put a very serious hole in coyotes’ and other human traffickers’ business), and we need to find a way to help the illegals here already (actually, the majority of them whose only crime is their illegal entry and who have otherwise been solid, productive members of their communities) gain legal status.

And get 4% GDP growth. The idea that “2 percent GDP growth is the new 4 percent” is just the contemptibly defeatist attitude of a quitter.

Progressive Tax Credits

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Targeting youth unemployment, Hillary Rodham Clinton plans to propose tax credits to encourage businesses to train young people and offer apprenticeships to develop lifelong job skills.

Clinton’s campaign said she would outline a proposed tax credit of $1,500 for every apprentice that a business hires….

Here’s a thought. How about lowering taxes altogether and getting the tax code out of the business of social engineering? With suitably low taxes, you wouldn’t need to play games with taxes as inducements to do this or as discouragements from doing that.

With suitably low taxes and the code out of the business of social engineering, businesses could spend their energies on sound business planning rather than on shopping around for a tax deal.

With suitably low taxes and the code out of the business of encouraging this or discouraging that, there’d be less need for special interest groups or lobbyists to push for this or that Very Important Consideration in our tax code. (Yeah, yeah, I know.)

There’s this, too, in Clinton’s plan:

The campaign said the tax credit proposal would require accountability for employment and earnings outcomes for businesses receiving the credit. Apprentices would need to be registered in order to be eligible.

The Progressive gives, and the Progressive takes away.   The savings gained from her tax credit will be fully recouped in the costs of compliance. However, the government will grow, and more IRS bureaucrats will be hired, so it’s all good.

Note, too, that this doesn’t begin to address jobs availability in the ensuing robust, growing economy.