July 26, 2010
Anything ironic about a union protesting a non-union business by paying non-unionized individuals minimum wage to picket? If you’re a representative for the Mid-Atlantic Regional Council of Carpenters, no.
That’s the subject of a recent Wall Street Journal report. The story notes the following:
… the Mid-Atlantic Regional Council of Carpenters is seeking paid demonstrators to march and chant in its current picket line outside the McPherson Building, an office complex here where the council says work is being done with nonunion labor. “For a lot of our members, it’s really difficult to have them come out, either because of parking or something else,” explains Vincente Garcia, a union representative who is supervising the picketing. So instead, the union hires unemployed people at the minimum wage—$8.25 an hour—to walk picket lines.
The story noted that Garcia didn’t see a problem with “a union that insists on union labor hiring nonunion people to protest the hiring of nonunion labor.” Go figure.
If the leaders of this union started their own business, do you think they’d be supportive of their employees unionizing to raise their wages? Questionable. Funny how things change when the roles are reversed.
June 9, 2010
Former Reagan economic adviser Arthur Laffer recently wrote in the Wall Street Journal that “incentives matter.” He was specifically referring to the incentive businesses and individuals have to shuffle their income earnings to this year instead of next when the Bush tax cuts are scheduled to expire.
As he notes, “People can change the volume, the location and the composition of their income, and they can do so in response to changes in government policies.” What this means, he argues, is that income for this year will be inflated making it look like the economy is improving. But, when taxes go up next year, economic productivity will go back down.
Businesses are incentivized to invest and produce when they keep more of their money thanks to lower tax rates. Increased tax rates decrease that incentive.
Similarly, something Laffer didn’t address in his piece is that increased regulation or uncertainty about what regulations government will soon implement also serve as disincentives for businesses to invest and produce. As such, the current climate in Washington doesn’t bode well for the prospects of a booming economy.
April 19, 2010
Despite rhetoric demonizing big retailers like Wal-Mart for what they pay their employees, the megastore is still a great driver of lower consumer product costs. Take for example a recent story from The Wall Street Journal detailing Wal-Mart’s plan to further reduce prices:
Wal-Mart Stores Inc. is cutting prices on thousands of products in an aggressive campaign to reinforce its reputation as a discount leader, as the company seeks to reverse months of slowing U.S. sales.
The world’s largest retailer was a rare beneficiary of the economic downturn, as large numbers of bargain-hungry Americans, including many middle-class families, flocked to its supercenters from supermarkets and specialty clothing stores.
Wal-Mart’s low prices not only attract bargain hunters, but they also aid those with lower to moderate incomes seeking to more wisely spend the money they take in. As the lede to the report notes, it is in Wal-Mart’s interest to cater to its customers. As a result, consumers reap the benefits and Wal-Mart makes a profit.
The company’s intent to make a profit, in a relatively free-market system, acts in way to also benefit individuals and families looking for products at a cheaper price. Wal-Mart may not intend to help out those with lower incomes, but by seeking a greater profit, it nonetheless does help them.
March 25, 2010
Bailed out financial institutions are quickly learning what the states learned a long time ago about receiving money from the federal government: There are pesky strings attached. The prime example is a recent Wall Street Journal story noting the details of the decisions made by the government’s “pay czar” (Could anyone have imagined such a title two years ago?).
Kenneth Feinberg has been busy artificially capping the pay of executives in the bailed out firms he has been dubiously given authority over. The WSJ report repeatedly says “Mr. Feinberg” did this, “Mr. Feinberg” did that. His oversight power essentially changes the decision-making process for executive compensation to where it is now beholden to only one, unaffected man instead of several men and women on the company boards who have a vital stake in how their company compensates employees.
[picapp align=”left” wrap=”true” link=”term=kenneth+feinberg&iid=8095002″ src=”b/b/e/d/TARP_Administrator_Kenneth_80ac.jpg?adImageId=11655666&imageId=8095002″ width=”234″ height=”174″ /]And, in reality, that is too simple of an explanation. In a relatively free market system, employee compensation is typically beholden to leaders in individual firms who are swayed by the prices for labor that the market sets. If there was any doubt that such a free market exists in this country, it only gained credibility with the appointment of Feinberg last year. Instead of relying on the voluntary action of individuals in the marketplace to determine the price of labor, politicians thought it wiser to appoint one man to make that decision for individuals — backed by the authority of the federal government and its “power of the purse.”
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March 16, 2010
With all the talk of dubious parliamentary procedures as means to slip through health-care “reform,” is there any doubt why only 17 percent of the public approves of the job Congress is doing? That’s according to a newly released NBC News/Wall Street Journal poll.
Suggestion to Congress: Whatever you are doing, just stop! End the meddling in our lives. We’d all be better for it.
In all seriousness, if every member of Congress were to leave Washington and never come back, would we really miss them? Doubtful.
Recall this quote attributed to Will Rogers:
The only difference between death and taxes is that death doesn’t get worse every time Congress meets.
May 15, 2009
This opinion piece from The Wall Street Journal by Todd Zywicki, a law professor, notes how the Chrysler situation is an example of the Obama administration’s lack of observance to the rule of law in terms of bankruptcy, credit and contracts. Maybe this should be looked into just as much as the Bush administration’s torture fiasco.