Job killing regulations

[Loren Pechtel]

And yes, most of the increases in the minimum wage don't cause the loss of jobs. And yes, it is possible to raise it too high and too fast. And yes, it is crazy to raise it in good times when we are at full employment. Which is the only time that neoclassical economics tells us that it will cause job loss.

Most increases do not produce job loss at a level we can measure above the noise. That doesn't mean they don't produce job loss. Lets go have a conversation on the deck of the USS Nimitz while they are conducting operations. You can't hear me talking? Does that prove I'm not saying anything?

And now we have an another example of business owners who are very upset by the increase in the federal government's contractor's minimum wage. . Once again, higher wages cuts profits. They are angry that their profits are reduced in a situation where their prices are fixed. Anyou believe that this establishes the proposition that high wages cost jobs in the overall economy where prices aren't fixed. If this is what you are saying I am willing to discuss it. But the world cup is on right now, Holland v. Mexico. Come on El Tri!

Strawman!

It establishes that they can't just absorb the costs like you think. In a normal environment the wage hike is passed through as a cost hike--and in the case of fast food you get the ironic result that the people you're trying to help are actually worse off. (Fast food workers have a higher average household income than fast food customers.)

 

[Jayjay]

I remember George McGovern after he left the Senate tried to open up a business and said that he wished he'd known what a pain in the ass regulations were because he'd have been a better Senator and presidential candidate.

I saw some Dem congressman who opened up a restaurant say more or less the same thing,

Here's McGovern:

In retrospect, I wish I had known more about the hazards and difficulties of such a business, especially during a recession of the kind that hit New England just as I was acquiring the inn’s 43-year leasehold. I also wish that during the years I was in public office, I had had this firsthand experience about the difficulties business people face every day. That knowledge would have made me a better U.S. senator and a more understanding presidential contender.

Today we are much closer to a general acknowledgment that government must encourage business to expand and grow. Bill Clinton, Paul Tsongas, Bob Kerrey and others have, I believe, changed the debate of our party. We intuitively know that to create job opportunities we need entrepreneurs who will risk their capital against an expected payoff. Too often, however, public policy does not consider whether we are choking off those opportunities.

My own business perspective has been limited to that small hotel and restaurant in Stratford, Conn., with an especially difficult lease and a severe recession. But my business associates and I also lived with federal, state and local rules that were all passed with the objective of helping employees, protecting the environment, raising tax dollars for schools, protecting our customers from fire hazards, etc. While I never doubted the worthiness of any of these goals, the concept that most often eludes legislators is: `Can we make consumers pay the higher prices for the increased operating costs that accompany public regulation and government reporting requirements with reams of red tape.’ It is a simple concern that is nonetheless often ignored by legislators.

http://aun-tv.com/george-mcgovern-warned-1992-get-government-regulation-out-of-business/

The funny thing about that story is the regulations that McGovern had to deal with. Each and everyone one of them (probably) was a small one, the kind of thing that would generally be thought of as "gee, nobody could really oppose that." If you do publicly oppose them you are made out as the kind of person who eats labradoodle puppies and uses their blood to make notes in the margins of your business plan. But he discovered that the cumulative effect is enormous.

He discovered that all of these well-meaning (allegedly but not actually) regulations do indeed come at a price, and that the more of them there are the bigger the price.

And that price is inefficiency. And the inefficiency is that a business has to hire more people to keep track of the regulations and to fill out the paperwork that is required.

Some regulations like environmental regulations have created entirely new industries to meet the terms of the regulations. New industries with entirely new companies all of which have jobs that wouldn't be filled without the regulations.

So have you thought of any regulations that kill jobs yet?

If the customers are not willing to pay more, where does the money come from to hire all those new people?

 

[Loren Pechtel]

If the customers are not willing to pay more, where does the money come from to hire all those new people?

When you dig you always find the infinite pool of excess profit at the heart of their arguments.

 

[DBT]

Who are all these struggling companies that cannot afford to pay their workers a pittance for their skill and labour? Is the average Engineering firm not able to pay the award rate of pay? Is the average supermarket run on such low margins that they cannot pay minimum wage?

What percentage of struggling businesses are we talking about?

 

[GenesisNemesis]

I personally prefer data over just-so stories.

 

[Togo]

If the customers are not willing to pay more, where does the money come from to hire all those new people?

When you dig you always find the infinite pool of excess profit at the heart of their arguments.

Hm.. No more than your arguments always assume people can work for infinitely less money.

The difference is that there is excess profit, while pay has remained more static. So one of these things is actually a problem, and the other is merely an imagined one.

 

[Axulus]

Give me some.

I am skeptical that there are that many, if any at all, and that the potential impact of these regulations is much less severe than those who use the mantra "job killing regulations" would have us believe.

http://www.upenn.edu/pennpress/book/15183.html
http://www.propublica.org/blog/item/whats-the-evidence-that-regulations-kill-jobs
http://www.citizen.org/documents/regulations-are-to-blame-unemployment-death-report.pdf
http://www.washingtonpost.com/opini...-regulations/2012/04/24/gIQARQQTfT_story.html
http://policyintegrity.org/publications/detail/regulatory-red-herring

I don't know if its been mentioned yet, but the regulations preventing the Keystone XL pipeline certainly cost jobs:

Claiming it could no longer abide the Obama administration's five-year refusal to approve construction of the Keystone XL pipeline designed to bring 830,000 barrels a day of much-needed Alberta shale oil to U.S. refineries, the Canadian government recently approved plans for a huge new pipeline and port project to ship that oil to Asia instead.

...

Building the proposed 1,179-mile Keystone pipeline promised, not just a huge new supply of reliable, clean, and affordable oil to U.S. markets, but the creation of up to 20,000 high-paying construction jobs. An additional 22,000 jobs economists predicted would have resulted from the broader economic stimulus the project would have generated.

http://www.breitbart.com/Big-Peace/2014/06/27/Goodbye-Keystone-XL-Hello-Enbridge-Northern-Gateway

 

[ksen]

I don't know if its been mentioned yet, but the regulations preventing the Keystone XL pipeline certainly cost jobs:

Claiming it could no longer abide the Obama administration's five-year refusal to approve construction of the Keystone XL pipeline designed to bring 830,000 barrels a day of much-needed Alberta shale oil to U.S. refineries, the Canadian government recently approved plans for a huge new pipeline and port project to ship that oil to Asia instead.

...

Building the proposed 1,179-mile Keystone pipeline promised, not just a huge new supply of reliable, clean, and affordable oil to U.S. markets, but the creation of up to 20,000 high-paying construction jobs. An additional 22,000 jobs economists predicted would have resulted from the broader economic stimulus the project would have generated.

http://www.breitbart.com/Big-Peace/2014/06/27/Goodbye-Keystone-XL-Hello-Enbridge-Northern-Gateway

What specific regulations are preventing the Keystone XL pipeline from being built?

 

[Togo]

Still no examples of job killing regulations. In fact, you can argue that most regulations that require time and energy to fulfill, like filing for permits increase the number of jobs, since you have to hire people to keep track of the regulations and to fill out the permits.

The hair braiders.

Complying with the laws simply costs too much for them to do--we are talking about people who are doing it part time as causal work and mandating a huge amount of irrelevant training means they simply won't do it.

So, what's the reason for the regulation? Could it be that there are some liability issues around grooming members of the public?

The only regs I'm familiar with in this area are UK based, to do with landlord liability in the event that something goes wrong - the hair braider hurts the customer, gets attacked, provide a front for pick-pockets or simply does a lousy job, and the landlord is held liable for allowing untrained people to carry out business on his property. Thus the landlord, or the city in the case of a public street or park, gets sued for negligence.

It strikes me that the problem there is not the regulation, which simply lays down a set of rules to be followed before the landlord can prove they have a reason to consider the person trained, but rather the right of the private individual to sue if the mood takes them. All the regs do is provide a framework for getting around this problem - they're not the reason that untrained people can't be hired.

Any other examples? Thousands to choose from, so this should be easy, right?

Around here the taxi commission is not allowed to permit more cabs on the street unless it won't hurt existing cabbies to do so. That's certainly job-killing regulation.

It's not really a regulation though, is it? It's a political mandate to control taxi numbers. Sounds more like someone's bribe to the drivers than an attempt to control or regulate anything.

Again, the challenge was to come up with regulations that kill jobs. Ideally we're looking for something intended to have some beneficial effect which reduces the number of people employed, and which isn't obviously a good idea for other reasons. Or is this meme based on an acknowledged falsehood?

 

[Loren Pechtel]

The hair braiders.

Complying with the laws simply costs too much for them to do--we are talking about people who are doing it part time as causal work and mandating a huge amount of irrelevant training means they simply won't do it.

So, what's the reason for the regulation? Could it be that there are some liability issues around grooming members of the public?

No. The problem is one-size-fits-all licensing requirements. The license is reasonable for what it covers but many people like the hair braiders don't do most of the things the license permits them to do.

Requiring cosmetology licenses for hair braiding is like requiring that you have to be a mechanic in order to pump gas.

Around here the taxi commission is not allowed to permit more cabs on the street unless it won't hurt existing cabbies to do so. That's certainly job-killing regulation.

It's not really a regulation though, is it? It's a political mandate to control taxi numbers. Sounds more like someone's bribe to the drivers than an attempt to control or regulate anything.

Again, the challenge was to come up with regulations that kill jobs. Ideally we're looking for something intended to have some beneficial effect which reduces the number of people employed, and which isn't obviously a good idea for other reasons. Or is this meme based on an acknowledged falsehood?

It's not a payoff to the drivers, it's a payoff to the taxi companies.

 

[Bronzeage]

The Keystone Pipeline is holding back jobs. Anyone can see that.

We only need to look at how much money BP spent to clean up their oils spill after 11 men died on their drill rig. Over $40 billion dollars went into the Gulf Coast economy in the past years. This doesn't include the legal fees, fines, and other expenses. Stricter regulations would have meant no one would see any of that money.

The states that are holding up the Keystone Pipeline, out of fear of risk to life and permanent damage to the environment, are just being short sighted.

Sure, there are jobs in the construction of the pipeline. The real money comes later. This assumes we don't relax the regulations about oil spills in our haste to create jobs.

 

[SimpleDon]

The hair braiders.

Complying with the laws simply costs too much for them to do--we are talking about people who are doing it part time as causal work and mandating a huge amount of irrelevant training means they simply won't do it.

So, what's the reason for the regulation? Could it be that there are some liability issues around grooming members of the public?

The only regs I'm familiar with in this area are UK based, to do with landlord liability in the event that something goes wrong - the hair braider hurts the customer, gets attacked, provide a front for pick-pockets or simply does a lousy job, and the landlord is held liable for allowing untrained people to carry out business on his property. Thus the landlord, or the city in the case of a public street or park, gets sued for negligence.

It strikes me that the problem there is not the regulation, which simply lays down a set of rules to be followed before the landlord can prove they have a reason to consider the person trained, but rather the right of the private individual to sue if the mood takes them. All the regs do is provide a framework for getting around this problem - they're not the reason that untrained people can't be hired.

Any other examples? Thousands to choose from, so this should be easy, right?

Around here the taxi commission is not allowed to permit more cabs on the street unless it won't hurt existing cabbies to do so. That's certainly job-killing regulation.

It's not really a regulation though, is it? It's a political mandate to control taxi numbers. Sounds more like someone's bribe to the drivers than an attempt to control or regulate anything.

Again, the challenge was to come up with regulations that kill jobs. Ideally we're looking for something intended to have some beneficial effect which reduces the number of people employed, and which isn't obviously a good idea for other reasons. Or is this meme based on an acknowledged falsehood?

I have been thinking about this subject quite a bit. I have three points.

There are badly written regulations and regulations that have been captured by politically favored companies to make their competitors less competitive. But nothing in these say that we should get rid of regulations entirely. Just that we have to do a better job of writing regulations.

I do have an example of a entire category of regulations that costs the economy a large amount of money, that makes things much more expensive than they have to be. These are zoning regulations. They exist solely to make certain properties more expensive than others and to prevent low cost housing from certain areas. There is no question that they increase the cost of housing. They infringe on the property owners ability to do what they want to do with their own property. And yet with all of the anti-regulation rhetoric today I can't remember anyone opposing this most obvious example of costly regulations.

The other point that I want to make is that it is not sufficient for the people who push deregulation and anti-regulation as a good to be applied as a principle across the board to give us examples of the job killing regulations that they want to eliminate, they should have to weigh the costs of regulations that kill jobs against the huge numbers of jobs destroyed by the misapplication of deregulation, for example the damage done by the Great Financial Crisis and Recession of 2008 caused by the mistaken belief that the financial markets could be trusted to self-regulate. How many millions of jobs were lost, how many millions of people were thrown out of homes that they wanted to live in, how many trillions of dollars did we lose in equity that disappeared over night? We will never recover the lost growth that we missed and to a large degree are still missing. And incredibly the people who were most responsible for the anti-regulation meme that caused the crisis and recession then turned around and decided that in a fit of petulance that they would do everything that they could do to impede and derail the recovery from that recession.

 

[arkirk]

Global trade is to blame for loss of jobs more than regulation. It can be regulation (demanding products be safe and not polluting) that increases the price of a product and insures public safety that also makes it possible for a capitalist to go somewhere and get their work done under less safe, conditions...cheaper. Recently another garment factory in Bangladesh collapsed and killed more than 1,000 workers. To the capitalist, the response is "Never mind, they have thousands more looking for work in Bangladesh.

Now we have Republicans running everything, we too can have that wonderful condition (again) here. The anti regulators are just looking for cheap...to them...not to you. Nike is a prime example. Bangladesh is also the home of massive water environment pollution. That is where many old ships go to die (scrapping operations) and pollute that water-logged country with heavy metals, oils, etc. It is also where a lot of workers get terribly injured. We could have that work here if we could only rid ourselves of that terrible regulation.

 

[Loren Pechtel]

Global trade is to blame for loss of jobs more than regulation. It can be regulation (demanding products be safe and not polluting) that increases the price of a product and insures public safety that also makes it possible for a capitalist to go somewhere and get their work done under less safe, conditions...cheaper. Recently another garment factory in Bangladesh collapsed and killed more than 1,000 workers. To the capitalist, the response is "Never mind, they have thousands more looking for work in Bangladesh.

The real job killer is technology. Machines are replacing workers.

 

[dismal]

Global trade is to blame for loss of jobs more than regulation. It can be regulation (demanding products be safe and not polluting) that increases the price of a product and insures public safety that also makes it possible for a capitalist to go somewhere and get their work done under less safe, conditions...cheaper. Recently another garment factory in Bangladesh collapsed and killed more than 1,000 workers. To the capitalist, the response is "Never mind, they have thousands more looking for work in Bangladesh.

The real job killer is technology. Machines are replacing workers.

Yeah, that's why 98% of us are unemployed farmers/hunters/gatherers now. Technology killed all the jobs.

 

[Togo]

I have been thinking about this subject quite a bit. I have three points.

There are badly written regulations and regulations that have been captured by politically favored companies to make their competitors less competitive. But nothing in these say that we should get rid of regulations entirely. Just that we have to do a better job of writing regulations.

I can certainly get behind that. My job is to read regulations and explain to people what they actually mean. There's no way that people should need a specialist to do that. But it does.

I do have an example of a entire category of regulations that costs the economy a large amount of money, that makes things much more expensive than they have to be. These are zoning regulations. They exist solely to make certain properties more expensive than others and to prevent low cost housing from certain areas. There is no question that they increase the cost of housing. They infringe on the property owners ability to do what they want to do with their own property. And yet with all of the anti-regulation rhetoric today I can't remember anyone opposing this most obvious example of costly regulations.

I'm not convinced on this one. The main aim of zoning regulation, as far as I can tell, is to prevent slums and urban sprawl. There's nothing inherently wrong with planning a town, and without zones I think the value of new builds would be significantly reduced. There's no real value in having a front and back garden and a white picket fence if a 12 story 24hr casino brothel is going to open up next door. With less money to be made from development, quality per unit suffers, houses become smaller and closer together, those who can move, move to somewhere that still has zoning laws, and rather than a pleasant affluent suburb you end up with the hills around Mexico city. The city then has to step in and spend more money on transport, sewerage power and so on, and someone has to pay for that.

Bear in mind though, that I don't see the reality of zoning laws, because the country I'm in doesn't really have them. Planning decisions here are made per house, not per zone. I've applied to build an extension at the back, and the planning department will give me a decision in two months time, based on their estimate of the impact on the neighbourhood, my neighbours, and the view from nearby. It's a pain, but if it wasn't controlled so tightly, I probably wouldn't want to live there.

The other point that I want to make is that it is not sufficient for the people who push deregulation and anti-regulation as a good to be applied as a principle across the board to give us examples of the job killing regulations that they want to eliminate, they should have to weigh the costs of regulations that kill jobs against the huge numbers of jobs destroyed by the misapplication of deregulation, for example the damage done by the Great Financial Crisis and Recession of 2008 caused by the mistaken belief that the financial markets could be trusted to self-regulate. How many millions of jobs were lost, how many millions of people were thrown out of homes that they wanted to live in, how many trillions of dollars did we lose in equity that disappeared over night? We will never recover the lost growth that we missed and to a large degree are still missing. And incredibly the people who were most responsible for the anti-regulation meme that caused the crisis and recession then turned around and decided that in a fit of petulance that they would do everything that they could do to impede and derail the recovery from that recession.

True.

I looked into setting my own bank, once. The maths of it all is pretty easy, you can run the whole thing on a laptop, you need maybe 8-15 clients to get started provided they're reasonably wealthy, You pay a nominal fee to a real bank to handle any actual transactions, and you can offer better rates and a personal service that even a private banking practice can't touch. But obviously, there are a lot of regulations around this, and that's principally what killed it for me. So that's technically a job-killing regulation, but then I'm not convinced that me having other people's money controlled from laptop with no background checks, rules or controls, is actually a good idea for anyone except me. Anyone else here think that Togo-bank is a good idea?

Simply removing regulations doesn't help, any more than breaking up all big companies into small ones helps. You actually have to understand the problem and do things about it. Politicians aren't good at doing that themselves.

I had a weird experience as a constituent trying to contact my MP about new EU regulations coming into effect. The MP (member of parliament - i.e. the guy I vote for (or not)) was very happy to help, but didn't understand a word of what I had put in front of him. Now I explain this stuff for a living, so if wasn't getting it from me, he wasn't getting it from anyone. But heard the word regulation, understood immediately that it was bad and should be gotten rid of, and suggested he send my recommendation to the Treasury. Which he did, under a letter that made it really clear he didn't have a clue what this was about. The Treasury gave me a polite reply, saying basically they couldn't do anything about it without a change in policy. They suggested that if I had a specific issue or suggestion, I should take it up with a member of a particular Treasury select committee, who were chosen for their experience in such matters, and were presently looking into this particular issue. So I looked up the head of the appropriate committee, only to find it was my MP. Which kinda suggested why it had happened in the first place. His only interest was in removing regulations, not in what they were.

 

[Loren Pechtel]

The real job killer is technology. Machines are replacing workers.

Yeah, that's why 98% of us are unemployed farmers/hunters/gatherers now. Technology killed all the jobs.

Technology also creates new jobs.

We used to pretty much have three jobs: Farmer, hunter, gatherer. Now a very small fraction of the population works at these jobs but we have an awful lot more types of jobs around than back then.

 

[coloradoatheist]

So, what's the reason for the regulation? Could it be that there are some liability issues around grooming members of the public?

The only regs I'm familiar with in this area are UK based, to do with landlord liability in the event that something goes wrong - the hair braider hurts the customer, gets attacked, provide a front for pick-pockets or simply does a lousy job, and the landlord is held liable for allowing untrained people to carry out business on his property. Thus the landlord, or the city in the case of a public street or park, gets sued for negligence.

It strikes me that the problem there is not the regulation, which simply lays down a set of rules to be followed before the landlord can prove they have a reason to consider the person trained, but rather the right of the private individual to sue if the mood takes them. All the regs do is provide a framework for getting around this problem - they're not the reason that untrained people can't be hired.

Any other examples? Thousands to choose from, so this should be easy, right?

Around here the taxi commission is not allowed to permit more cabs on the street unless it won't hurt existing cabbies to do so. That's certainly job-killing regulation.

It's not really a regulation though, is it? It's a political mandate to control taxi numbers. Sounds more like someone's bribe to the drivers than an attempt to control or regulate anything.

Again, the challenge was to come up with regulations that kill jobs. Ideally we're looking for something intended to have some beneficial effect which reduces the number of people employed, and which isn't obviously a good idea for other reasons. Or is this meme based on an acknowledged falsehood?

I have been thinking about this subject quite a bit. I have three points.

There are badly written regulations and regulations that have been captured by politically favored companies to make their competitors less competitive. But nothing in these say that we should get rid of regulations entirely. Just that we have to do a better job of writing regulations.

I do have an example of a entire category of regulations that costs the economy a large amount of money, that makes things much more expensive than they have to be. These are zoning regulations. They exist solely to make certain properties more expensive than others and to prevent low cost housing from certain areas. There is no question that they increase the cost of housing. They infringe on the property owners ability to do what they want to do with their own property. And yet with all of the anti-regulation rhetoric today I can't remember anyone opposing this most obvious example of costly regulations.

The other point that I want to make is that it is not sufficient for the people who push deregulation and anti-regulation as a good to be applied as a principle across the board to give us examples of the job killing regulations that they want to eliminate, they should have to weigh the costs of regulations that kill jobs against the huge numbers of jobs destroyed by the misapplication of deregulation, for example the damage done by the Great Financial Crisis and Recession of 2008 caused by the mistaken belief that the financial markets could be trusted to self-regulate. How many millions of jobs were lost, how many millions of people were thrown out of homes that they wanted to live in, how many trillions of dollars did we lose in equity that disappeared over night? We will never recover the lost growth that we missed and to a large degree are still missing. And incredibly the people who were most responsible for the anti-regulation meme that caused the crisis and recession then turned around and decided that in a fit of petulance that they would do everything that they could do to impede and derail the recovery from that recession.

And we also have a problem of trying to find the actual causes and everybody uses their views to look at the problem and try and mold what they see as the issue into the framework they want. So in the case of the financial crisis the anti-deregulation people had to try and find something that had deregulation in it and point to that as the cause even though the financial crisis was caused by a multitude of items including government rules, money supply issues, government direction, etc that caused the issue and without any of them the problem would have been a lot less or may not have happened.

We also have the issue where we had only really big problem at the time, but we overract. Sarbanes and Oaxley is one that we had the bad cause of Enron, but in its attempts to stop that one bad apple, we've really hurt small companies and chocked off growth for those companies.

 

[fromderinside]

Uh huh....

So when the government says "Tesla, you may not sell directly to the consumer, you must use the car dealership model" that's the same as saying "murder is illegal, so is murder for hire also illegal."

I think that you are talking about fairness, not jobs. It seems that Tesla selling directly to the public would be more efficient and generate fewer jobs than adding the extra layer of having to go through a dealership. Or do you think that Tesla selling directly to the public would require more jobs and be less efficient?

Once again, the thread is asking for examples of job killing regulations. There must be thousands of them to have the impact on the economy that you claim.

Efficiency is a job killer when selling more cars increases jobs? Queer logic that as is all this shit juxtaposing regulations meant to protect lives as job killing regulations.