Lemony Lerner's Series of Unfortunate Events

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The media are abuzz with the IRS affair. As you may have heard, former IRS official Lois Lerner, in charge of tax exempt groups, directed harassment operations targeting conservative groups. She also recommended auditing Republican Senator Charles Grassley. Appearing in front of the House Oversight Committee (HOC) in May 2013 and again last March, she pled the Fifth and refused to answer any questions. Later, IRS commissioner John Koskinen announced that potentially damning emails that were subpoenaed by the committee had disappeared in a series of computer crashes affecting Lerner’s machine, as well as the machines of at least six other IRS officers with whom she was not discussing anything important anyway.

Soon thereafter, neighbors of the plush EPA office in the District of Columbia reported hearing a huge "you can do that?" cry of relief. The EPA, you see, is also being investigated by the HOC, for unrelated power grabs. It promptly announced that it, too, had been a victim of these temperamental machines and that disk crashes had eliminated all compromising emails that had been subpoenaed. So there.

The administration had already spent millions retrieving emails containing only irrelevant, harmless messages, and duly supplied them to the HOC, chaired by Congressman Darrell Issa (R-Calif.). Surely, the administration implied, enough is enough. Besides, President Obama himself had designated conservative groups as a "threat to our democracy" as early as 2010. With such divine sanction, how could the IRS be blamed for its actions?

The gremlins sneak in with the mail, escape from the mail rooms, kick office doors, gnaw hard drives, eat magnetic tapes, shred paper records, and hypnotize IT managers into a hardware destruction trance.

Some journalists are starting to smell a fish, but not our modern-liberal media. Oh no. They are jumping to the defense of Lerner, claiming that Republicans are on a witch hunt. This reference to the paranormal may be more accurate than they think. It is the only explanation that makes sense.

Consider the accumulation of bad luck, hardware problems, incompetence, and plain carelessness that was apparently at work. Lerner's drive crashed, and so did the drives in her colleagues' machines — in June 2011, just ten days after being informed of the pending investigation for the targeting of conservative groups. Then, in September, the IRS canceled its contract with email backup software vendor Sonasoft, purged its Exchange email server of old mail, destroyed the tape backups, and decommissioned 22 perfectly good storage servers that were used to archive emails and documents, all the while breaking the laws and rules that mandate the IRS to keep backups. The details of what happened at the EPA are not public yet, but they'll probably reveal a similar pattern of cataclysmic incompetence and bad luck.

This long chain of implausible events cannot be random. The only explanation is supernatural.

Any sane, right-thinking person is forced to conclude that the Republicans send invisible gremlins with the Freedom of Information Act (FOIA) requests they issue to our honest, hard-working federal officials. The gremlins sneak in with the mail, escape from the mail rooms, kick office doors, gnaw hard drives, eat magnetic tapes, shred paper records, and hypnotize IT managers into a hardware destruction trance. These critters are hellbent on destroying records just to embarrass Democratic officials. The fact that the officials are saved from the even greater embarrassment of having to wear those unsightly orange prison jumpsuits is purely coincidental.

Fortunately, there is a solution. After all, the US is still at war in Afghanistan, as the press tends to forget. So Obama could stop the madness by simply classifying the work of all federal bureaucrats as wartime secrets, thereby defeating further FOIA requests.

It is high time that the Republican FOIA freaks stop terrorizing our nation with their invisible gremlins. Sanity must return.

References
Forbes timeline: http://www.forbes.com/sites/paulroderickgregory/2013/06/25/the-timeline-of-irs-targeting-of-conservative-groups/
EPA data: http://thehill.com/policy/energy-environment/210564-epa-says-hard-drive-crashed-emails-lost




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Not Our Fight

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Excuse me if I sound insensitive, but the shooting down of a Malaysian passenger plane by Russian separatists in Ukraine is none of our business. It wasn’t our plane, it wasn’t our country, and it isn’t our fight. Moreover, only one passenger was remotely American (I say “remotely” because he held dual citizenship and had lived in the Netherlands since he was five). So we should just keep our noses out of this one. We don’t need to impose sanctions, beef up our military presence, or drive the price of oil down in order to destroy the Russian economy, as some have suggested.

While it is a terrible shame that anyone should be killed in an accident, that’s all this really was: an accident. What seemed to be a Ukranian military jet turned out to be a passenger plane, and the shooter pulled the trigger before making certain of the target. When our troops make that kind of mistake, we call it “friendly fire,” and because it isn’t an intentional act, we hand out some medals to the victims and let the shooter slide.

Am I the first to ask the unspoken but obvious question: Didn’t they know they were flying over a war zone? Didn’t they know that Russian separatists had been shooting down Ukranian military jets for weeks? Hours after the accident, commercial airlines began diverting their flight plans around Ukraine; a map released today shows almost no planes above that country. Seems to me they should have made that adjustment as soon as the fighting broke out in Ukraine. I’m no fan of Putin, but if I were holding anyone responsible for this terrible accident, it would be the air traffic controllers and flight plan originators who allowed commercial jets to fly over a war zone.

Again, if my remarks seem insensitive, I apologize. Not one of the people on that plane deserved to die; the grief of their families is deep, and their deaths are unwarranted. But I would rather cry over 300 people killed in an accident than worry about thousands of additional soldiers sent to police the area. This one simply isn’t our fight.




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R>G Revisited

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The Washington Post chose July 4 — a holiday kicking off a three-day weekend — to bury an interesting article, and it’s not hard to see why. Check out Zachary Goldfarb's lede:

After making fighting income inequality an early focus of his second term, President Obama has largely abandoned talk of the subject this election year in a move that highlights the emerging debate within the Democratic Party over economic populism and its limits.

During the first half of this year, Obama shifted from income inequality to the more politically palatable theme of lifting the middle class, focusing on issues such as the minimum wage and the gender pay gap that are thought to resonate with a broader group of voters.

The pivot is striking for a president who identified inequality as one of his top concerns after his reelection, calling it “a fundamental threat to the American Dream, our way of life and what we stand for around the globe.”

The Post is the quintessential establishment newspaper, as in tune with everything DC and its satellite suburbs as it is out of tune with everything else. Generally, the Post house style is to provide justifications for the actions of the powerful and connected, because they must be, on average, wiser and better than the populace — if they weren’t, then how would they have obtained their power and connections?

Imagine a “tax” on power — every year, those in whose hands so much is gathered must surrender a small percentage of it, to be distributed among those who have so little.

With few exceptions, then (notably, the articles on Edward Snowden and national security) you shouldn’t read the Washington Post for intellectual stimulation. Rather, read it for insights into the cramped and contorted psyche of the ruling class — there’s really no better way to place yourself into the sort of mental confines occupied by those who hold federal office.

For instance, to read the paragraphs above, it might seem as if the president is being called out for waffling on a core principle, or worse, betraying a group of people to whom he successfully pandered in the last election. The piece might even be interpreted as a lament for what is “politically palatable” in this country, or for the voters who would put the concerns of the middle class over those of the truly destitute. But the Post would never run even mild criticism without outweighing it with rationalizations or outright praise: thus the focus here is not on the president’s shortcomings, but rather his shrewdness, softening his rhetoric in time for the midterm elections. Where once the president had been determined to bring up inequality, not caring “whether that was a good economic message” (according to that ultimate Beltway insider, the mysterious “person familiar with the process, who spoke on the condition of anonymity in order to discuss private conversations”), he has caved to political reality, and shifted his rhetorical course.

Of course, it must just be a coincidence that this new tack steers the president toward the interests of the DC establishment — and toward Wall Street, to boot. If one thought otherwise, why, there are employees at a whole range of DC-based thinktanks, from the Center for Equitable Grown on the left, to the Heritage Foundation on the right, and plenty more in between, all waiting to give soundbites about how one set of words is so much better than another for this thing called the “American middle class,” which we never actually see in the story, but which must exist given how often these important people discuss it. And of course, even the more radical of Obama’s supporters can delude themselves into thinking that such strategery is necessary so that Obama can devote himself to truly egalitarian reforms in his final two years.

It would be unthinkably gauche for the Post to suggest that Obama’s rhetoric on inequality was never sincere, or to point out that Wall Street has overwhelmingly backed Obama from the start — that’s left for journalists such as Tim Carney and unfavored papers such as the Washington Examiner to do. But all in all, the performance in this article isn’t entirely convincing, as if even the Post was tiring of repeating the talking points of K Street thinktankers and anonymous apparatchiks. Maybe it’s the Snowden files, or maybe it’s the shift to a new generation, or maybe it’s just the unstable position of newspapers with our digital present, but the Post is a little uneasy about just how much the people at the top control. And that means at least some portion of the establishment is uneasy about that as well.

The president might have to stop ordering people locked up or killed without some pretense of due process.

All of this made me revisit the discussion in these pages of Thomas Piketty’s book Capital. Piketty’s massive tome oversimplifies to a single principle, given as r>g, meaning that the rate of return on wealth exceeds the rate of economic growth, at least in Western industrialized nations. Were this true, then income inequality would inexorably increase, and wealth would be concentrated in ever greater amounts in ever fewer hands. Of course, as Mark Skousen and Leland Yeager showed, Piketty’s principle rests on several unsustainable assumptions about the permanence of capital and the assumption of risk.

However, Piketty’s principle makes a lot of sense when viewed as a statement not about wealth, but about political power. Yes, the two are related; in the present day, perhaps fatally so. But that sort of crony capitalism would be impossible without the power consolidation represented by Washington DC — the very arrangement that ensures that power will continue accruing to those already neck deep in it.

Piketty’s preferred solution for his perceived economic problem, a wealth tax, would only increase the flow of money going into, and much more rarely out of, our imperial metropolis. Imagine, however, an equivalent “tax” on power — every year, those in whose hands so much is gathered must surrender a small percentage of it, to be distributed among those who have so little. There are benefits straight off: everyone in office would have to list off all the political powers and assets they think they possess, and these could then be compared to the Constitution to get an idea of how deep the cuts would have to be.

Ideally, the tax would be progressive, so that those with comparatively little scope of power, such as first-year podunk-state congressmen with bottom-tier committee assignments, would only give up, say, a sugar subsidy that helps out a campaign donor. Those at the top, meanwhile, would be expected to turn over much more for the commonweal: the president, for instance, might have to stop ordering people locked up or killed without some pretense of due process.

It would take a while. And realistically, it would never come close to evening things out. But if we had such a mechanism that put power back in the hands of the people — as in, actual control over their own lives, not just as some weak metaphor for voting blocs — we could nonetheless do a great deal to reduce political inequality in the United States. And that would go much farther toward protecting The American Dream, our way of life, and what we stand for around the globe than anything else Obama or any other DC denizen might choose to do.



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President Obama and President Hammond

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As Independence Day comes once more to America, we find ourselves with an administration that is laboring to become a despotism. Not content with making laws by executive order, nor abashed by a long series of rebukes from the Supreme Court, the president has proclaimed his intention of acting in defiance of Congress for the specific reason that Congress has refused to enact the laws he wanted.

The president recently summoned the speaker of the House and asked him when Congress would do his bidding on the immigration issue. The speaker said he saw no way of passing legislation this year. Probably he didn’t bother to state the fundamental reason, which is that no one trusts the president to keep his word about any executive actions mandated by legislation in this field (or perhaps any other). The president then announced that he would therefore proceed without Congress. Network news reported on July 1 that Obama had ordered his cabinet ministers to journey throughout the country, finding “creative means” of doing what Congress does not want to be done, not just about immigration but about every policy he wishes to effect.

This is a textbook definition of despotism — the executive acting in despite of an elected legislature.

Presidents have often exceeded their authority, but no other president has proceeded systematically on the declared principle of doing what Congress refuses to authorize, because Congress has refused to authorize it. Even Lincoln, who invaded the Constitution more dramatically than any other president, never proceeded on that principle.

The only precedent that favors the current chief executive is that of President Hammond, who in pursuit of his economic program went before Congress and said:

You have wasted precious days and weeks and years in futile discussion. We need action, immediate and effective action. . . . I ask you, gentlemen, to declare a state of national emergency and to adjourn this Congress until normal conditions are restored. During the period of that adjournment, I shall assume full responsibility for the government.

 When a congressman protested, asking, “If Congress refuses to adjourn?” Hammond replied, “I think, gentlemen, you forget that I am still the president of these United States, and as commander in chief of the army and navy, it is within the rights of the president to declare the country under martial law.” (For more about President Hammond, see Liberty, July 2010, pp. 21–29.)

The president has proclaimed his intention of acting in defiance of Congress for the specific reason that Congress has refused to enact the laws he wanted.

 

 That happened in 1933, when MGM released a movie called Gabriel Over the White House. In the movie, President Hammond is the hero. In his own mind, President Obama is a hero too. 

At July 4, thoughts customarily turn to heroes. Mine customarily turn to President Washington. Washington’s thoughts about a free government were somewhat different from those of President Hammond or President Obama. Take them as a gift of intelligent political thought, on this Independence Day:

It is important . . . that the habits of thinking in a free country should inspire caution in those entrusted with its administration, to confine themselves within their respective constitutional spheres, avoiding in the exercise of the powers of one department to encroach upon another. The spirit of encroachment tends to consolidate the powers of all the departments in one, and thus to create, whatever the form of government, a real despotism. A just estimate of that love of power, and proneness to abuse it, which predominates in the human heart, is sufficient to satisfy us of the truth of this position. The necessity of reciprocal checks in the exercise of political power, by dividing and distributing it into different depositaries, and constituting each the guardian of the public weal against invasions by the others, has been evinced by experiments ancient and modern; some of them in our country and under our own eyes. To preserve them must be as necessary as to institute them. If, in the opinion of the people, the distribution or modification of the constitutional powers be in any particular wrong, let it be corrected by an amendment in the way which the Constitution designates. But let there be no change by usurpation; for though this, in one instance, may be the instrument of good, it is the customary weapon by which free governments are destroyed. The precedent must always greatly overbalance in permanent evil any partial or transient benefit, which the use can at any time yield. (Farewell Address, 1796)




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The Congressional Killswitch

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Sometimes a story is just so perfect that the immediate response is suspicion, even skepticism, that such a thing could be. Even when backed by unimpeachable evidence, even to relate the story in another context, a reporter (this reporter, anyway) feels he must get the caveats out of the way, even at the expense of burying the lede, because it’s simply too easy to proceed any other way.

So then.

Eleanor Holmes Norton is a Delegate to Congress representing the District of Columbia in the House of Representatives. Though allowed to serve on committees as well as speak on the House floor, DC reps cannot vote on legislation and thus have only symbolic power—hence the District license plate legend, “No Taxation Without Representation.” Holmes was first elected to Congress in 1990 and has faced no substantive opposition to the renewal of her term since, nor will she until she retires.

Google is a very, very large company. Despite early attempts to avoid governmental entanglement, combined with a motto, “Don’t Be Evil,” that is warm and fuzzy by big-biz standards, Google is nonetheless one of the most politically involved corporations in the world, donating many millions to causes such as gay marriage rights and alternative energy sources—as well as to the Democrats, where such ideas are on the whole more welcome. However, in recent years (and in particular, after a potentially nasty antitrust suit) Google has been hedging its bets, courting the Republicans as well to make sure that whoever happens to be on top, Google can still prevail.

If they weren’t so quick on the killswitch, maybe Google wouldn’t need to spend so many of its resources lobbying for approval.

One of Google’s main ongoing projects is the creation of a driverless car—something that can hook into an overarching traffic grid and speed passengers to their destinations without the limitations of human frailty or curiosity: no more merge delays, no more fender benders, no more rubbernecking. Clearly hoping for congressional money to be shoved their way, Google hosted an event for the House Transportation and Infrastructure Committee to showcase their new toy. And as a ranking member of that committee, Holmes was not only invited along, but also given pride of place as the first occupant of the shotgun seat, with results I highly recommend you watch in the video on this page.

For no sooner does she sit down than she wrecks the whole show: “It says Emergency Stop,” she says, while tapping and then smashing a big red button marked with exactly those words. And the Google spokesman (and Carnegie Mellon engineer), trying valiantly to control his panic, replies “Oh, no, don’t press that, it shuts everything down, and it takes some time to, um, recover from that.”

And with all the above caveats out of the way, how perfect an image is this of how legislators interfere with progress in technology and markets? A company wishes to test out a new product, and instead of going to the customers to see if it will succeed, they must first kowtow to those in authority (the representative of all Washington, D.C., as a matter of fact), who promptly misunderstand the device and render it useless—and then have the gall to take some sort of perverse credit for the deed, as implied in the newscasters’ comment: “Norton does think that cars like that could have a future so long as they have safety features like that kill switch.” Thanks, Delegate! Without you we’d never have known how to murder promising technology in mere seconds.

As the further exchange shows, even as a constitutionally powerless member of the House, Norton can still cast a formidable shadow:

“And you know, if they ever get that started, it could be a cool little ride.”
“I guess it still needs a little work.”
“Still needs a little work, yes.”

But despite their gentle, demagogic mockery, the newscasters save for the end a shrewd observation, one that calls into question the very idea of a large-scale federal government: if you are to build such a thing, “Be careful who you put in it—Delegate Norton may not be invited next time around.”

Would that we could all disinvite Delegate Norton, and her 535 cronies actually charged with lawmaking in this country! If they weren’t so quick on the killswitch, maybe Google wouldn’t need to spend so many of its resources lobbying for approval—and the rest of us wouldn’t have to bide our time waiting for advances that would’ve been possible decades ago, apart from the reticence and hesitance of our so-called leaders.



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Iraq and Isolationism

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I have no wisdom to offer about the current crisis in Iraq; I’m simply immobilized by astonishment over the idea, still dominant in Washington, that the United States should arrange and enforce a united Iraq. But I do have some thoughts about libertarian attitudes toward Iraq and other targets of American intervention.

Isolationists — and almost all libertarians are isolationists of some kind — can take pride in opposing the intervention that overthrew Saddam Hussein. It would have been better for virtually all concerned in this mess if Saddam, lunatic fool that he was, had stayed on his throne. Then at least we might not have seen the victory, in one part of the country, of a corrupt Shi’ite authoritarianism, and the worse victory, elsewhere, of a mob of howling Sunni fanatics vowing to lock women in their houses and behead or crucify all opponents of their holy cause. They have already advertised on the internet the massacre of hundreds or thousands of captured and disarmed soldiers of the Iraqi government — the kind of atrocity that even Hitler concealed.

It would have been better for virtually all concerned in this mess if Saddam, lunatic fool that he was, had stayed on his throne.

But there is something about this situation that isolationists should consider more carefully than we usually do. There is evil, intractable evil, in this world, and the more we isolate ourselves from it, the more intractable it reveals itself to be. America’s gradual withdrawal from world military conflict allows us to see more clearly that this evil cannot all be attributed to America, or the West, or colonialism, or imperialism, or G.W. Bush or Barack Obama or even the accursed Lyndon Johnson. The enslavement of women in Nigeria is not an effect of Western intervention. The vile fanaticism of the Iraqi insurgents is not the result of Western intervention. The modern steel gallows on which the religious leaders of Iran hang gay men are not the effect of Western hegemony. Like the other things I just mentioned, they are an attempt to appropriate the material culture of the West and place it in the service of depraved native ideals.

When I see a sign that says “Live and Let Live” my heart leaps up. That is liberty; that is what I believe in. But I do not believe that most cultures in the world are based on that principle, or that they would be if we would simply obey it ourselves. Libertarian commentary on American foreign policy often creates the impression that the extended meaning of “Live and Let Live” is “All Will Be Well If You Do.” It won’t. There is evil in America, and by the same token there is evil in the rest of the planet, and plenty more of it — inexhaustible supplies, in fact. Isolation is not the road to utopia. It should be the road to realism.




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John Kerry Speaks!

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At many colleges and universities across this great land of ours, graduation weekend has just passed. Amid the festivities and regalia and good-hearted celebration, that meant the return of one of our most dreaded civic traditions: the commencement speech. For those fortunate enough to have avoided these in recent years, the commencement speech has become the chief opportunity for would-be public intellectuals to spout truisms and feel even more self-important than usual.

Case in point: one of this site’s favorite bloviators, John Kerry. Invited to speak at Yale’s Class Day, presumably on the strength of his sterling undergraduate record, Kerry produced a masterpiece of vacuity, making a case for how urgently the students needed to trust their “instutitions,” by which he meant the government. In addition to the expected lame jokes and the kinds of cultural references that dads make to try and pretend they’re still cool, Kerry indulged in his habitual verbal offenses:

  • word salad, such as rallying students to “galvanize action to recognize felt needs” (translation: “we need to spend lots of money meddling with people”);
  • doublespeak, such as “We cannot allow a hangover from the excessive interventionism of the last decade to lead now to an excess of isolationism in this decade.” (translation: “especially meddling with people in other countries”);
  • bumper stickerism, such as “None of our problems are without solution, but neither will they solve themselves” (translation: “our meddling can solve anything”); and
  • dubious assertions, such as “Participation is the best antidote to pessimism and ultimately cynicism” (translation: “never doubt even for a moment that meddling isn’t the right thing to do”).

Thing is, by graduation-weekend standards, Kerry’s speech is only half bad—I’ve survived much worse. What’s happened this year that has given me hope is students finally getting fed up and fighting back. At a number of schools, the student body banded together to reject the speaker being foisted on them. This move has brought howls from the sorts of writers who hope themselves one day to deliver commencement addresses. But why submit yourself to listening to a half hour from an architect of the Iraq War, like Condoleeza Rice, or a defender of forceful police coercion against nonviolent student protestors, like Robert Birgenau, if there’s any alternative? Graduations are a time for students to celebrate with friends and family, a chance to reflect on years past and look forward to years future. Nothing about that requires the importation of big-name outside speakers—especially those whose fame depends on the degree to which they’ve intruded themselves into the lives of others.



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Vox Populi

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At almost every really snazzy party I’ve been allowed to attend during the past few years, the conversation lagged until one among the elegant guests brought up American Idol — the TV show on which people compete by displaying the “skill” of shrieking in falsetto voices and manifesting faux emotions. As soon as that subject was introduced, everyone became enthusiastic. At last, they had something to share. Everyone, it seemed, was rooting for one or another of the contestants, although there was general agreement that all of them were wonderful and deserved the highest praise. This was enough to dash any illusions I might have harbored about the cultural level of the wealthy and powerful.

Imagine my horror when I found that someone named Clay Aiken was running for Congress and attracting attention, for no other reason than the fact that he had been a contestant on American Idol. What next, I thought — Hillary Clinton running for president?

On May 13, the electorate of North Carolina — working folks, mostly, not members of the mentally idle rich — laid my fears to rest. At least my fears about Clay Aiken. The media, ever zealous for the cause of Democrats, heralded his victory in the Democratic primary. What many stories didn’t mention was that he won by a mere 400 votes, beating a man who had died the day before.

Aiken may not get elected.

In fact, he will not get elected. His Republican opponent, now running for a third term, got 56% of the November vote last time. Even if she dies of campaign injuries, she’ll stand a very good chance of beating him.

As for Hillary — even if the Republicans nominate a dead man, which they probably will, chances are she’ll get beat.




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Imagined Community

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Fudan University, Shanghai: Photograph by Joseph Ho

Fudan University, Shanghai: Photograph by Joseph Ho




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Equal Pay for Equal Work

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Once again equal pay for men and women doing presumably equal work has become a live political issue. If Congress can achieve fair pay by passing still another law, why not?

But what is equal work? Is it the same numbers of hours spent? Is it work in the same industry or other category, broadly or narrowly defined?  Is it work typically done by people with similar levels of education as proxied by diplomas and degrees? Are what economists call “compensating differences” unfair — differences in pay for work considered particularly risky or boring and work found attractive in itself? More plausibly, does fair pay mean equal pay for work appearing to promise the same addition to the revenue or profit of a business firm? If so, as judged by whom? Without attention to availability, productiveness, and costs of materials, energy, and other things bought, including the many kinds of labor, a firm would go broke.

More equal-pay legislation will add to the burdens already borne by business firms, perhaps especially small businesses.

An economic system coordinated otherwise than by market transactions and the interplay of prices, profit, and loss would be very different from the system that has brought prosperity to the Western world. A market economy puts to good use vast amounts of knowledge both specific and widely dispersed. This knowledge, as well as informed conjectures, exists in the minds of millions and billions of consumers, employees, job candidates, entrepreneurs, and owners and managers of business firms and other organizations. Knowledge of how to conduct and mesh their activities simply could not be centralized for effective use by planners and regulators. The writings of Mises and Hayek (and, earlier, Henry George), reinforced by experience in Communist countries, have taught us this lesson. Even if, per impossibile, this knowledge could be centrally deployed, politicians would have incentives to disregard much of it.

Business owners and managers, sometimes aided by specialist consultants, can best judge how to structure their workplaces and employ the people most likely to contribute to profits. Supply and demand interacting on markets, including the labor market, contribute to these judgments. Business losses tend to weed out bad judgment of these kinds, while profits tend to reward good judgment.

Employers must judge how likely employees or job candidates are to fit in well with their businesses. How likely is a person to be available for working long or irregular hours on short notice or for shifting among assignments and geographical locations? How committed is the person to a career, or how likely to quit or interrupt work for family or other reasons or to request many hours or even months of paid or unpaid leave? How likely is the person to generate profitable new ideas? How likely to get along well with customers, colleagues, and supervisors? Or how likely to prove obnoxiously litigious? A good matching of jobs and employees benefits all concerned.

Realistically, of course, employers cannot have all the detailed and ineffable knowledge necessary for ideal decisions. They must make judgments based on categories, experience, probabilities, statistics, and hunches, and perhaps sometimes even on stereotypes. These regrettable gaps in knowledge are not blameworthy or avoidable, although detailed experience and practiced intuition may shrink them. The system of markets, profit, and loss tends, at least, to reward or punish good or bad business judgment; nothing similar weeds out bad legislation.

Government regulators drift into thinking that their own work is important.

More equal-pay legislation will add to the burdens already borne by business firms, perhaps especially small ones. These will include the burdens of keeping records of and reporting on job interviews held or not held, performance reviews, job categories and modifications, and innumerable other things. Risks compound the burdens, including risks of being second-guessed about honest judgments and of dubious statistics being manipulated to infer violations of rules even in the absence of evidence. Government regulators drift into thinking that their own work is important and into eagerly receiving and investigating complaints. Aggrieved employees have additional ways to browbeat their employers by threatening to file complaints or lawsuits. Opportunities for lawyers multiply.

The burdens placed on job creation are heavy already. They apparently help account for the disappointing growth in employment as recovery from the recession continues only sluggishly.

Yet far from being morally obliged to bear such burdens and risks, businesspeople are under no obligation to be in any business or hire any workers at all. Even employing job candidates willing to work for less pay than others appearing similarly qualified is a service to workers and the public (even if a less noble service than one might wish). Employing anybody increases the scarcity value and the job and pay prospects of the rest of the labor force. Employers practicing discrimination unrelated to the value of employees’ work suffer the penalty of reduced profit and lose ground to firms showing sounder business judgment.

Speaking of fairness, how fair is it to draft businesspeople more and more into unpaid and thankless service as social-welfare agencies and as scapegoats?

Making a political issue of “fair pay” expands opportunities for politicians and demagogy. It illustrates how superficial bright ideas can get casually inserted into laws, notably into laws running hundreds or thousands of pages. As Thomas Sowell has explained, being both economically literate and honest is a disadvantage for a politician. (An economically illiterate one can honestly advocate bad but popular legislation, while a dishonest politician may gain votes by concealing his economic understanding.)

My message, in summary, is dismay at ignorance or disregard of how essential using widely dispersed specific knowledge is to a prosperous economy.




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