Tag Archives: jobs

Federally Mandated Wages

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Here’s another fiasco-in-waiting being manufactured by the Progressive-Democrat Party and its leader, President Barack Obama.

The Obama administration has advanced to the final stages a contentious rule that will make millions more Americans eligible for overtime pay….

The Labor Department sent its final version of the overtime-pay regulation to the White House Office of Management and Budget on Monday for review, according to an administration official.

This rule will force employers to pay overtime for hours worked beyond 40 in a week to salaried workers whose annual basic salary is $50,440 or less—an increase of more than 200%.

As any grade schooler who’s on an allowance knows, when the price of something goes up, the grade schooler buys less of that thing.  When the price of labor goes up….

This government interference in the private economy will have two effects: salaried employees who used to put in the overtime now will be barred from that—to the overall detriment of the company’s productivity and so competitiveness, and from that to the detriment of the jobs of that company.

Alternatively, the company, in an effort to maintain company-level productivity, will suck up and pay the overtime.  This will drive up the cost of the company’s products, reduce the funding available for R&D, and from that harm the competitiveness of the company to the detriment of the jobs at that company.

Alternatively, the company will hire fewer workers, replace fewer workers who depart for any of a variety of reasons, to the detriment of employment generally.

These folks of the Left know that; they’re some of the smartest people around, as they assure us.  But, hey—union votes.

The Truth

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…is beginning to come out.

At a CNN Ohio coal country Townhall involving Progressive-Democrat Party Presidential candidates Hillary Clinton and Senator Bernie Sanders (I, VT), Clinton said, in all seriousness,

I’m the only candidate which has a policy about how to bring economic opportunity using clean renewable energy as the key into coal country, because we’re going to put a lot of coal miners and coal companies out of business.

Her campaign then clarified, in a post-Townhall statement, that her plan “would also safeguard workers’ retirement and health benefits.”  But do nothing about their current jobs so they can get to retirement, apparently.

In an MSNBC-hosted Townhall, Clinton also said this with a straight face:

Now, is Libya perfect? It isn’t.  Libya was a different kind of calculation [from Syria] and we didn’t lose a single person….

Because #FourLivesDon’tMatter.

Hmm….

The PRC’s Economic Malaise

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Andrew Browne had some thoughts in a recent Wall Street Journal article. PRC’s Premier, Li Keqiang, wanted to do some serious revamping of the nation’s economic structure and deemphasize a massively overbuilt industrial capacity, shifting the economy more toward consumer production and consumer spending. His words—”This is not nail-clipping; it’s like taking a knife to one’s own flesh”—were reminiscent of his predecessor’s actions. Zhu Rongji eliminated 30 million jobs in an actual overhaul attempt in the ’90s.

Thirty million jobs. That sounds like a lot, but with a workforce of roughly 800 million and roughly 95% employment (because, of course), those 30 million represent just 4% of the workers overall. That’s a sharp cut, but as job cuts go during downturns, it’s not that sharp.

But even that much was too much for Li. Or rather for PRC President Xi Jinping.

[H]igh-level economic policy-making and its practical implementation, once the preserve of the State Council headed by the premier, have increasingly fallen into the hands of Communist Party committees led by President Xi Jinping.

And

…Xi’s political preoccupations: to strengthen the party…to root out challenges to the régime, and to avoid social instability that could in any way threaten the party’s hold on power. If that means delaying unpopular economic adjustments, so be it.

“The party’s hold on power:” read that as Xi’s hold on power, say I. And the people of the People’s Republic can go hang.

The Left’s Iron Curtain

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…is getting a bit taller. I wrote earlier about the Democratic-Progressive Party’s wish to erect an Iron Curtain to keep American companies from leaving for more economically (read: tax) sound environments. Now, Democratic-Progressive Party Presidential candidate and proud Progressive Hillary Clinton is enlarging her Iron curtain. Clinton now is proposing this:

Companies that move jobs and production out of the US would lose previous years’ tax breaks under a proposal Democratic presidential candidate Hillary Clinton released Friday during a speech in Detroit.

The US would seek to “claw back” previous tax incentives for research and development and for domestic manufacturing associated with facilities or jobs that move abroad.

On top of that,

The Clinton campaign didn’t have an estimate of how much money its tax plan would generate for the government.

Of course not. The purpose isn’t to recover monies foregone as incentives to do this or that, it’s strictly to imprison private enterprises within the US, Soviet-style—because private enterprises aren’t jobs factories, rather they are, according to this candidate, jobs welfare programs.

Remember this in the fall.

An Empirical Test

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It isn’t often that we get to run a controlled experiment in economics, but one seems to be beginning in Oregon on the matter of minimum wages.

Oregon lawmakers have approved landmark legislation that propels the state’s minimum wage for all workers to the highest rank in the US, and does so through an unparalleled tiered system based on geography.

The legislation will raise the state’s minimum wage to

$14.75 in metro Portland, $13.50 in smaller cities such as Salem and Eugene, and $12.50 in rural communities.

This will be complete in just six years, by 2022.

And that’s the experiment. Over the course of these next six years, watch employment rates adjust across the three geographies, and watch small business startup and development across those three geographies.

Hmm….