Category Archives: regulation

Why Does Seattle Hate The Unskilled?

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The Seattle city council, in its infinite Know Better wisdom, has passed what it’s pleased to call a “secure scheduling” ordinance.  This is an ordinance that requires “certain” employers

to tell their workers two weeks in advance which shifts they will be working.

Should an employee be called in for extra hours, say, to replace a sick co-worker, the employer will have to pay him added “predictability pay.” Should an employee be sent home early—maybe because business is slow or a delivery is late—the employer must compensate him for half the hours he was scheduled to work.

And, if you can believe it,

[O]n-call staff will earn half pay for shifts when they are not called into work, while those employees that have less than 10 hours between two shifts will receive time and a half. Managers will also be required to offer any additional hours to current employees before taking on new hires.

Never mind some well-known actual facts.

In response to Seattle’s recently passed minimum wage law that will quickly raise the minimum to $15/hr, a University of Washington study released last summer

found that the mandated wage increase has led to fewer hours worked per-employee and slightly less overall employment for Seattle’s lowest-paid workers, compared to similar earners in other parts of the state.

And last spring the San Francisco Chronicle reported that in response to San Francisco’s “secure scheduling” ordinance,

1 in 5 surveyed businesses had cut back on the number of part-time hires, and a similar number were scheduling fewer employees per shift[.]

Of course, the worthies on Seattle’s city council know these things—the histories are much too recent for them not to know—hence the question in my title.

Federal Funding for Medicaid

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Medicaid is a State-run program for providing a measure of medical service for that State’s relatively indigent citizens.  The program is State-run, but it’s jointly funded by the State’s taxpayers and by the nation’s taxpayers via Federal funds transferred to each State for the purpose.  I’ve often written that Federal funds for Medicaid should be ended and that the States should  be allowed to fund and manage their Medicaid programs alone—without Federal funding and associated Federal interference.

Here’s another reason to end Federal funding for a State’s Medicaid program.

US District Judge Kristine Baker issued a preliminary injunction preventing Arkansas from suspending payments to Planned Parenthood for any services to Medicaid patients in the state. Republican Governor Asa Hutchinson last year terminated the organization’s Medicaid contract because of secretly recorded videos made by an anti-abortion group.

Baker also expects that Planned Parenthood would win at trial, hence her injunction.

Unfortunately, the Federal judge is right on the law, if only on 14th Amendment grounds, and on the courts’ Taney-esque position that unborn babies aren’t fully human.

Other than changing that law, though, the way around this sort of thing is that elimination of Federal funds for any State’s Medicaid program.  With that elimination, States that disapprove of Planned Parenthood’s funding of abortions could stop funding Planned Parenthood, and States that approve of easy abortions could continue to do so.

Some Data on the Obama Economic Recovery

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And on Democratic Party Presidential candidate Hillary Clinton’s policy impact on that recovery from the Panic of 2008, since Clinton has promised, proudly, to continue and extend President Barack Obama’s (D) economic policies.  These data are via Robert Barro’s (Harvard University economics professor and American Enterprise Institute visiting scholar) piece in The Wall Street Journal.  He and a colleague, Tao Jin, looked at

macroeconomic disasters in 42 countries, featuring 185 contractions in GDP per capita of 10% or more. These contractions are dominated by wartime devastation such as World War I (1914-18) and World War II (1939-45) and financial crises such as the Great Depression of the 1930s.

Among other things, they found that blaming the slow- to non-recovery on the Panic’s severity or on global financial crises, in their gentle phrase, “conflicts with the evidence.”

Among the specifics of their findings:

The growth rate of total nonfarm payrolls averaged 1.7% a year from February 2010 to July 2016, despite the drop in the labor-force participation rate. The post-2009 period is not a jobless recovery; it is a job-filled non-recovery.

And

[T]he drop in the unemployment rate—from 10% in October 2009 to 4.9% in July 2016—has been impressive, though overstated because of the decrease in labor-force participation.

Never mind that half the GDP lost during the contraction is typically recovered within two years of a recovery’s start.

So, what policies led to this failed recovery?  There have been lots, ranging from attacking hydrocarbon-based energy production and the destruction of jobs with the subset of the Democratic administration’s war on coal (and growing war on oil and natural gas), the Obama EPA regulations intruding onto private property (no cattle ponds on private ranches, recall), Labor Department’s and NLRB’s restrictions on non-union labor, and so on.  The primary policy, though, has been this administration’s increase in government transfer payments.

Federal social benefits to persons (things like Medicaid, Medicare, Social Security, and food stamps) as a fraction of GDP rose from 8.7% in 2007 to 10.9% in 2015.  That’s a 25% rise in the fraction of GDP that’s money taken out of the private economy, washed through a middleman government, and the remainder then passed along to others.  In real dollar terms, that’s an increase from a skosh over $1.3 trillion in 2007 to a skosh under $2 trillion in 2015, an increase of more than 50%.

That’s money not applied to actual economy-stimulating and job-creating activities: free trade, rolling back inefficient regulations, fiscal discipline, and, yes, public infrastructure such as highways and airports.  That’s money not applied to enhancing productivity.

The growth rate of GDP per worker from 2010-15 was 0.5% per year, compared with 1.5% from 1949 to 2009.

Instead, Clinton not only wants more of the same.  She was for the Pacific and Atlantic free trade deals on offer (and one soon to be before Congress) before she lately found it politically expedient to be against them.  She favors increasing regulation—evil Wall Street and political speech are her targets du jour—not reducing it.

Her idea of fiscal discipline is increased spending, partially paid for with higher taxes.  She wants “free” education, paid for with higher taxes; reduced borrower liability for student loans, paid for with higher taxes; free day care, paid for with higher taxes; free health care—single payer, yet (never mind that contradiction)—paid for with higher taxes; free family leave from employment, paid for with higher taxes and higher prices since the employer must pay, also, if only through reduced output and so reduced sales; and on and on.

And that infrastructure work?  She is for that—so long as it’s done by Government approved union labor, and not by the most cost efficient contractors.

The Entire Island

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Repair crews worked through the night trying to restore electricity to Puerto Rico’s 3.5 million people early Thursday after a fire at a power plant blacked out the entire U.S. territory.

Officials said they hoped to restore service by morning….

It turns out that they didn’t make by the morning, and the outage extended into a second day—lengthened not just by the severity of the problem, not unique in itself to Puerto Rico, but also by Puerto Rico’s lack of money with which to fund repairs or even parts and equipment to replace the damaged/failed parts and equipment.

I have to wonder about similar vulnerabilities, similar single points of failure, extant on our separated States and other separated territories and within CONUS.  I have to wonder about these vulnerabilities not only in our power distribution grids, but in our communications grids, and cascading from those, in our financial networks and our government effectivity networks.

As Governor Alejandro Garcia Padilla said,

The system is not designed to withstand a failure of this magnitude.

Neither are any of our systems.  Nor are they designed to any large degree to minimize, if not eliminate, single points of failure.

Obamacare Fail

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The headline of this Wall Street Journal piece pretty much says it all: Average Cost of Employer Health Coverage Tops $18,000 for Family in 2016.

The sub-head, with careful reading, adds clarity: Pace of cost increase slowed by accelerating shift into high-deductible plans, new survey shows.

That cost of employer coverage, buy the way, refers to the premiums employees must pay: $18,142 for a 2016 typical employer-offered family plan, and employees have to pay 30% of that, typically, up from 29%.  Like a sergeant I once worked with liked to say, sort of, “Holy cats.”

Is that cost increase rate actually slowing, though, where it matters to the individual—the employee?  Not in the deductibles.  Shifting into high-deductible plans means the policy holder—the employee—has to pay lots more out of his own pocket just to get to the point where the coverage plan begins to pay its 50%, or 60%, or maybe as high as 80% of the medical costs.  For that year.  Then the deductible has to be paid anew.

Notice another part of that sub-head: accelerating shift into high-deductible plans.  That means that in that next year, the erstwhile high-deductible plan may not be available: the employee may be stuck with purchasing a different plan, perhaps with an even higher deductible, perhaps with higher yet premiums, perhaps with coverage not as useful to the employee.

This is what Obamacare, not the employers, has wrought.  This is what needs to be tossed in its entirety into the medical waste disposal and replaced with a more honest environment within which actual insurance can be had, and competitively so.