tag:blogger.com,1999:blog-582368152716771238.post5010879967570142242..comments2024-03-28T14:41:03.793-05:00Comments on The Grumpy Economist: Federalization of LaborJohn H. Cochranehttp://www.blogger.com/profile/04842601651429471525noreply@blogger.comBlogger15125tag:blogger.com,1999:blog-582368152716771238.post-23097434003307955392016-08-17T00:41:52.986-05:002016-08-17T00:41:52.986-05:00A few years ago, I posted:
"I just realized t...A few years ago, <a href="http://hertzlinger.blogspot.com/2012/08/a-fallacy-i-havent-seen-lately.html" rel="nofollow">I posted</a>:<br />"I just realized that I haven't seen the claim that paying higher wages is good for the economy because it enables workers to buy more in years, possibly decades."<br /><br />It's ba-ack!Josephhttps://www.blogger.com/profile/04720409839023747889noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-3295647611658797192016-08-05T18:22:06.758-05:002016-08-05T18:22:06.758-05:00"Redistribution hasn't happened in the la..."Redistribution hasn't happened in the last 40 years?" Sorry, I have to call a four Pinocchios on that one. Our income tax is highly progressive, and our government spends several trillions of dollars each year, sending people checks. Have you never heard of social security, medicare, medicaid, welfare, food stamps, and so forth? (To say nothing of farm price supports, small business subsidies and so on). Maybe you don't think enough redistribution has happened, or that it goes to the wrong people-- tenable positions. But "redistribution hasn't happened" is just so ludicrously false I have to call it out. John H. Cochranehttps://www.blogger.com/profile/04842601651429471525noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-10934524625379676862016-08-05T17:19:16.868-05:002016-08-05T17:19:16.868-05:00Most economic models sweep away any distributional...Most economic models sweep away any distributional downsides to a policy with the following argument:<br />"First maximize the size of the pie, then THROUGH REDISTRIBUTION everyone should be better off" <br />This is true, but redistribution hasn't happened in the last 40 years. Then when people call on distribution, classical narrow-minded economists repeat the same phrase about the size of the pie, for how long will this be sustainable? <br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-21436846808698616522016-08-05T12:42:56.074-05:002016-08-05T12:42:56.074-05:00Don't you understand? Every business has a big...Don't you understand? Every business has a big bucket of "profit" sitting in the accounting department that each company is puzzled about what to do with it. Thankfully, the Federal government can help these businesses decide what to do with that bucket of profits. As an added bonus we get to increase the size of the government so they can think of even more wonderful things that businesses can do to be more successful.khodgehttps://www.blogger.com/profile/14159304285391375601noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-79712073014361139082016-08-05T11:52:03.764-05:002016-08-05T11:52:03.764-05:00"Equal pay for equal work?" Just terribl..."Equal pay for equal work?" Just terrible!Now the feds will determine pay, hiring and firing? Criminal penalties are threatened if businesses' don't comply? This is nothing less than despotic statism writ large. David Seltzernoreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-25748694725922573472016-08-04T22:32:48.596-05:002016-08-04T22:32:48.596-05:00Re:Gordon. Businesses have little ability to shif...Re:Gordon. Businesses have little ability to shift money from profits to salaries. That is, if higher salaries get spent, it increases business revenues such that overall it is a wash for profits. Thanks.Charles DuBoishttps://www.blogger.com/profile/17139978413665218618noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-58199397063700508022016-08-04T22:29:57.520-05:002016-08-04T22:29:57.520-05:00Taking from Peter to give to Paul is an incomplete...Taking from Peter to give to Paul is an incomplete definition of deficit spending. Peter gets a T-security in return for his money so he is no poorer. Paul, in contrast, has more money. To the extent Paul spends the money, GDP, etc. is increased. This is no long-term solution to economic growth, of course, but it can help over the short-run. In addition, this "borrowed" money will typically never be paid back, as this "debt" (the private sector asset) will usually just grow along with the economy forever. It is only paid back if budget surpluses were to occur. Thanks.Charles DuBoishttps://www.blogger.com/profile/17139978413665218618noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-81291417516885681352016-08-04T15:42:46.151-05:002016-08-04T15:42:46.151-05:00At least the calls for infrastructure spending, K-...At least the calls for infrastructure spending, K-12 education, and vocational training are all justifiable on economic grounds; if a bit naive when it comes to the actual results.<br /><br />The perpetual motion machine of personal consumption leading to ever increasing prosperity is really puzzling. The heart of modern macro is all about inter-temporal decision making, dynamic programming, and budget constraints. These people get paid to teach this stuff, so its disappointing to see them continuing to peddle this. I'm at a loss to explain their willingness to say this, short of being paid to do so. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-51283259322291455222016-08-04T14:11:54.245-05:002016-08-04T14:11:54.245-05:00I'm not sure if it'll make you any less gr...I'm not sure if it'll make you any less grumpy but, for what it's worth, Clinton at least has the good graces to keep her "please elect me" economic proposals small. The stuff you're worried about amounts to a hill of beans in the grand scheme of things.<br /><br />The Clinton plan involves spending huge amounts on ending sequestration, making college tuition cheaper, infrastructure investment and her worker's leave programs. Each of these costs substantially more on its own than all of Clinton's other proposals combined (at least per Moody's break-down).<br /><br />So yes, the profit sharing tax break is foolish. But it's also teeny-tiny, so it'll never hurt anyone either (other than Sanders & Trump; it is a pretty ingenious method for garnering moderate votes). Ditto the whole apprenticeship thing and pre-K. So no need to get so grumpy!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-88294993245850790112016-08-04T12:31:43.002-05:002016-08-04T12:31:43.002-05:00A colleague and I were working on a 3D printing st...A colleague and I were working on a 3D printing startup. Our research and capital commitment of $2,000,000 were in place. We estimated the venture would reach break even in the first year with p~.8. Our optimism was truncated when both the EPA and OSHA couldn't give us definite guidelines for compliance. Their comments: "No study has been done as to safety...blah blah." "We'll get back to you." "When?" "Indeterminate." The best one, off the record from one of these incompetent civil servants, "You'll put a lot of people out of work." I had enough.I said, "No sir! You and your agencies are putting people out of work with moronic regulations." Of course I have no intention of pursuing a venture that puts me in an uncertain position vis a vis authoritarian government agencies. My biggest fear, one of these agencies criminalizing a garden variety manufacturing error. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-87078932056235662482016-08-04T07:24:33.267-05:002016-08-04T07:24:33.267-05:00Reducing profit volatility means increasing labor ...Reducing profit volatility means increasing labor income volatility doesn't it? How will that go down?doggerel10noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-6753023289993463562016-08-03T22:45:56.083-05:002016-08-03T22:45:56.083-05:00One way to increase wages is to make them more vol...One way to increase wages is to make them more volatile -- higher risk means higher expected returns. Paying labor a fixed percent of revenues, instead of a fixed dollar amount, would also reduce the volatility of profits, thereby reducing the cost of of capital (or required profit margin). It would also give labor a direct stake in the business, aligning their interests with management and shareholders. It may not be a good solution for all companies or industries, but it's something many companies and labor unions should consider. Note that a revenue share is different from profit sharing.Aging boomerhttps://www.blogger.com/profile/12071714993117207030noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-59072929586459651072016-08-03T19:50:38.478-05:002016-08-03T19:50:38.478-05:00Hillary appears to be worst of both worlds: a mark...Hillary appears to be worst of both worlds: a market interventionist and a globalist-militarist (implemented through the fantastically expensive if ineffective agencies of the federal government).<br /><br />And she is considered the orthodox choice.<br /><br /><br />Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-62383471053353456012016-08-03T12:26:45.763-05:002016-08-03T12:26:45.763-05:00I didn't even know that the Department of Labo...I didn't even know that the Department of Labor had agents until the Obama Administration started sending them off to intimidate coal and oil and gas companies. I haven't heard of many inquiries into companies building solar arrays and wind farms. Funny how enforcement of outmoded 1930's legislation is so selective.Anonymoushttps://www.blogger.com/profile/05835197635286625706noreply@blogger.comtag:blogger.com,1999:blog-582368152716771238.post-73689133666668644002016-08-03T09:40:45.563-05:002016-08-03T09:40:45.563-05:00Verbless sentences. Awesome catch. Have you read ...Verbless sentences. Awesome catch. Have you read Orwell's Politics and the English Language? I think it is fun and very much to your point. (Stocks down, the gods must be angry was also great.) <br /><br />For selfish reasons that you might not approve, I think you should really promote the Libertarian Party. There are indeed more than two parties. Get your guys here on board the Johnson/Weld train! ;)Anonymousnoreply@blogger.com