The Dangers of Welfare

These are illustrated by a Letter to the Editor in Friday’s Wall Street Journal.  The letter-writer wrote of a pay raise his company gave its employees and a bit of Panic of 2008 history:

Despite high unemployment rates [during the Panic], we still struggled to find well-qualified employees. We were competing against the federal government’s repeatedly extended subsidy for unemployment programs. We interviewed dozens of people who flatly told us they were only interviewing to obtain another log entry to remain qualified for unemployment benefits, and that they didn’t need to work for us when they could get paid almost the same to not work at all—for 52 weeks or more.

This is one contributor to an abominably slow recovery.

Doing Business with the PRC

The People’s Republic of China is stepping up their corporate espionage.

Starting November 1, police officers will have the authority to physically inspect businesses and remotely access corporate networks to check for potential security loopholes, according to the regulations released Sunday by the Public Security Ministry. Police will also be authorized to copy information and inspect records that “may endanger national security, public safety, and social order,” the rules said.

And

The new regulations also reinforce requirements on censorship and surveillance laid out in the cybersecurity law.

And to steal company secrets and classified information, and to plant malware for future use.

This is just one more reason for businesses to stop doing business with PRC companies or inside the PRC.  Lose market share?  What’s the cost of having all your secrets stolen, PRC domestic companies set up in competition based on those secrets, and then you, having been milked dry, being tossed aside?

What’s the cost to the security of your home country?  Oh, wait—that’s that patriotism that companies like Alphabet so deprecate.

College?

I’ve written before about whether college is for everyone.

Some empirical evidence appears in a Wall Street Journal piece about last week’s unemployment number.

Peerfit Inc is growing, adding 80 staffers to its original 20 in just the last year and increasing their wages 5%-10% in the same period.  CEO Ed Buckley has noted the difficulty in finding “good people.”  Then he added this kicker:

When we first started, everyone we were hiring had a four-year college degree.  Now the skill set [of vocational hires] is sometimes even sharper than their counterparts coming out with a four-year college degree.

Hmm….

Austerity

Continuing the theme that other parts of the world still exist, this thought on Brazil’s upcoming presidential election.  In a Wall Street Journal piece about the Brazilian presidential candidates’—all 13 of them—big economic plans with no money to implement them, the item’s author offered this bit:

Mr. Bolsonaro has raised the most hopes in financial markets of tackling the endemic spending problem. …his top economic adviser, economist Paulo Guedes, has promised investors fiscal austerity….

It’s sad that “journalists,” whose interns surely know better, continue to insist that reducing government spending is somehow “austerity.” How is it austerity to leave more money in the hands of the people who earned it?  How is it austerity to leave the private economy free to spend its own money on its own imperatives instead of the Know Betters who populate government spending it for them on Know Betters’ “goals”?

Reduced government spending—and reduced tax rates, the two cannot work effectively in isolation from each other—far from being austere, allows an economy to grow.

The Brazilian government needs to get out of the way of the nation’s private economy.  Its high spending and high taxing are what constitute austerity.  Brazil’s citizens live austere lives because the government confiscates their money—to the tune of 40% of GDP—and it spends that confiscated money, not on those citizens’ wants or needs, but on government salaries and pensions, and on schools and hospitals that would be well supported and staffed in a free market economy.

Taxes and Caps

Howard Gleckman, Senior Fellow at the Tax Policy Center, wants the $10,000 cap on the federal deduction for state and local taxes repealed.  After all, he worries [emphasis added],

what will happen to state budgets if high-income residents resist tax increases that are now less subsidized by the federal revenue code[?]

Further, Gleckman is arguing,

restoring the old distortion “may indirectly benefit low- and moderate-income households” by propping up state spending.

Because it’s a Good Thing for State governments to keep taking their citizens’ money away from them and spending it for them.  It’s a Good Thing for State governments to continue spending heavily and crowding out private enterprises by consuming resources and accesses to money that would be better and more efficiently used by those States’ citizens and their private enterprises.

Remember this, next month.