Minimum Wage and Jobs (Who Is The Loser?)

PRO TIP: I use a browser separate from my go to that I can erase all the history and cookies in order to open up articles from sites (like Forbes or American Spectator) that regulate how many free articles you can access before a “pay wall” is set up and they block you from access to more. You may need to do this if you follow the links below.

In a continuing discussion [of sorts], some more articles regarding the Davis Bacon Act (coming in a future post) and minimum wage issues have been linked/levied. I do not have time to respond to them all, but I will to some of the major articles. Here I will extend the discussion about employment… but the gist of our positions are as follows:

An article linked by Chris L. was an enjoyable read is from FORBES. While I believe parts of it are wrong, it was a good, digestible size. (And the reason he linked it had to do with a “living wage” 9point #1], but the article – even there – does not support Chris’s contention. Linking that article is actually a train wreck for Chris L., 🤓) HOWEVER, the portion about jobs is in full agreement with my position above. Here is my main point from the author’s seven that is still my main premise:

3) Myth: An increase in the minimum wage is bad for employers

Paying a higher wage to employees can also help employers cut costs in other ways, according to the Center on Budget and Policy Priorities. “Beyond simple supply and demand theory,” reads a comprehensive report on the economics of raising the minimum wage, “increasing the minimum wage may also spur businesses to operate more efficiently and employees to work harder.”

Yes, excellent, so, “more efficiently” is the same as saying “using less labour for the same output”. That is, they’ve just said that business will fire some people as a result of the higher wages. Or, as we keep saying, there will be unemployment as a result.

I believe Chris L. posted this article as a refutation of my position — and I clearly made the points that raising minimum wage leads to loss of jobs (almost always for the poorest among us).

CONTINUING with that article:

5) Myth: It will cost us jobs and raise unemployment

So far, there is no evidence that raising the minimum wage causes an increase in unemployment or job loss. In fact, in a Goldman Sachs analysis of the 13 states which have raised their minimum wage, found that “the states where the minimum wage went up had faster employment growth than the states where the minimum wage remained at its 2013 level.”

“No evidence” is a pretty strict test to have to meet. And that statement is entirely wrong:

We estimate the minimum wage’s effects on low-skilled workers’ employment and income trajectories. Our approach exploits two dimensions of the data we analyze. First, we compare workers in states that were bound by recent increases in the federal minimum wage to workers in states that were not. Second, we use 12 months of baseline data to divide low-skilled workers into a “target” group, whose baseline wage rates were directly affected, and a “within-state control” group with slightly higher baseline wage rates. Over three subsequent years, we find that binding minimum wage increases had significant, negative effects on the employment and income growth of targeted workers. Lost income reflects contributions from employment declines, increased probabilities of working without pay (i.e., an “internship” effect), and lost wage growth associated with reductions in experience accumulation. Methodologically, we show that our approach identifies targeted workers more precisely than the demographic and industrial proxies used regularly in the literature. Additionally, because we identify targeted workers on a population-wide basis, our approach is relatively well suited for extrapolating to estimates of the minimum wage’s effects on aggregate employment. Over the late 2000s, the average effective minimum wage rose by 30 percent across the United States. We estimate that these minimum wage increases reduced the national employment-to-population ratio by 0.7 percentage point.

And:

We review the burgeoning literature on the employment effects of minimum wages – in the United States and other countries – that was spurred by the new minimum wage research beginning in the early 1990s. Our review indicates that there is a wide range of existing estimates and, accordingly, a lack of consensus about the overall effects on low-wage employment of an increase in the minimum wage. However, the oft-stated assertion that recent research fails to support the traditional view that the minimum wage reduces the employment of low-wage workers is clearly incorrect. A sizable majority of the studies surveyed in this monograph give a relatively consistent (although not always statistically significant) indication of negative employment effects of minimum wages. In addition, among the papers we view as providing the most credible evidence, almost all point to negative employment effects, both for the United States as well as for many other countries. Two other important conclusions emerge from our review. First, we see very few – if any – studies that provide convincing evidence of positive employment effects of minimum wages, especially from those studies that focus on the broader groups (rather than a narrow industry) for which the competitive model predicts disemployment effects. Second, the studies that focus on the least-skilled groups provide relatively overwhelming evidence of stronger disemployment effects for these groups.

There may be evidence you’ve not seen, evidence you don’t know about, even evidence you’d prefer not to believe but the statement that there’s no evidence is simply flat out false.

The same author in another FORBES article refutes the idea that there is “no evidence” in the Card/Krugman study, in which the idea is found via Krugman:

  • There’s just no evidence that raising the minimum wage costs jobs, at least when the starting point is as low as it is in modern America. — Paul Krugman

Said author slams this position well! As have I in a past posts:

(More Below Referencing This “Study”)

A N D, here is a article on the same topic via the DAILY SIGNAL:

1. It would be a job-killer.

The Congressional Budget Office report estimated that a $15 minimum wage would lead to 1.3 million lost jobs by the year 2025, with job losses rising over time due to compounding negative impacts.

The exact number of job losses are highly uncertain, but the report says losses would most likely range between zero and 3.7 million, with a not-insignificant chance that losses could exceed 3.7 million.

A 2011 Heritage Foundation estimate was even bleaker. It estimated a $15 minimum wage would lead to 7 million lost jobs.

Some groups have tried to minimize this part of the picture, focusing instead on the 17 million workers who currently earn below $15 that would receive an income boost. But this simply means that for every 13 workers who would get a wage boost, one worker would lose their job entirely.

Considering that a lost job can mean a family loses its home, not to mention a host of other long-term consequences, that doesn’t seem like a trade-off worth making.

One position is right, the other wrong. It may be the fact that most economists actually care about the poor and are not in Cris L.’s world all evil, greedy, GOP’ers… or as he put it: …”you’re going to post a portion of a book by a conservative economist…”

But the issue is not one economist, although he [Thomas Sowell], it really deals with history as most economists sift through it. Here, for example, is an article from FORBES:

In a comprehensive, 182-page summary of the research on this subject from the last two decades, economists David Neumark (UC-Irvine) and William Wascher (Federal Reserve Board) determined that 85 percent of the best research points to a loss of jobs following a minimum wage increase.

As in any academic discipline, there are outliers. But even the outliers are problematic: For instance, the famous (or rather, infamous) New Jersey study that associated a higher minimum with increased employment was later refuted in the same academic journal that originally published it. More recently, the paper that the President relied on to make his case for a higher minimum was debunked in a study published by the National Bureau of Economic Research.

Of course, the goal of minimum wage policy is not to reduce employment, but rather poverty. Indeed, Stevenson says explicitly in her commentary that a higher minimum wage will achieve this end. But empirical evidence refutes her point. Twenty-eight states raised minimum wages in the four years prior to passage of the last federal minimum wage increase. Economists from Cornell and American Universities, writing in the Southern Economic Journal, found no associated reduction in poverty rates….

[As an aside, I have the 182-page summary {book} mentioned in the article… I tried to find it on my book shelves, but, I am afraid I moved it to a box and placed it on my stored books pallet.]

New York is a good model as well for recent examples:

Over the past four years, the minimum wage for New York City restaurants that employ more than 10 workers went from $10.50 an hour to $15. That’s a whopping 43% increase. Next year, every restaurant, big and small, will have to pay their workers at least $15 an hour.

A big victory for workers, right? That’s how it’s depicted by the “Fight for $15” crowd. And, yes, if you held a full-time minimum-wage job over those years, your gross income would have gone up by $9,360.

But those massive wage hikes come at a painful cost that backers refuse to acknowledge. They kill jobs. Just like they’re doing right now in New York City.

In just the last three months of last year, 4,000 workers lost jobs at full-service restaurants, Bureau of Labor Statistics data show

(IBD)

And in an article referenced in the above excerpt, we find this (via AEI):

An article in the New York Eater (“Restaurateurs Are Scrambling to Cut Service and Raise Prices After Minimum Wage Hike“) highlights some of the suffering New York City’s full-service restaurants are experiencing following the December 31, 2018 hike in the city’s minimum wage to $15 an hour, which is 15.4% higher than the $13 minimum wage a year earlier, and 36.4% higher than the $11 an hour two years ago. For example, Rosa Mexicana operates four restaurants in Manhattan and estimates the $15 mandated wage will increase their labor costs by $600,000 this year. Here’s a slice:

Now, across the city, restaurant owners and operators are reworking their budgets and operations to come up with those extra funds. Some restaurants, like Rosa Mexicano, are changing scheduling. Other restaurateurs are cutting hours and staffers, raising menu prices, and otherwise nixing costs wherever they can.

And though the new regulations are intended to benefit employees, some restaurateurs and staffers say that take home pay ends up being less due to fewer hours — or that employees face more work because there are fewer staffers per shift. The bottom line is, we have to reduce the number of hours we spend,” says Chris Westcott, Rosa Mexicano’s president and CEO. “And unfortunately that means that, in many cases, employees are earning less even though they’re making more.”

In a survey conducted by New York City Hospitality Alliance late last year, about 75% of the more than 300 respondents operating full-service restaurants reported they’ll reduce employee hours this year because of the new wage increases, while 47% said they’ll eliminate jobs in 2019.

Note also that the survey also reported that “76.50% of respondents report reducing employee hours and 36.30% eliminated jobs in 2018 in response to mandated wage increases.”

So, to quote a “conservative” economist, Thomas Sowell, these raising wages — artificially, separate from the market — have consequences:

A majority of professional economists surveyed in Britain, Germany, Canada, Switzerland, and the United States agreed that minimum wage laws increase unemployment among low-skilled workers. Economists in France and Austria did not. However, the majority among Canadian economists was 85 percent and among American economists was 90 percent. Dozens of studies of the effects of minimum wages in the United States and dozens more studies of the effects of minimum wages in various countries in Europe, Latin America, the Caribbean, Indonesia, Canada, Australia, and New Zealand were reviewed in 2006 by two economists at the National Bureau of Economic Research. They concluded that, despite the various approaches and methods used in these studies, this literature as a whole was one “largely solidifying the conventional view that minimum wages reduce employment among low-skilled workers.”

[….]

Another group disproportionately affected by minimum wage laws are members of unpopular racial or ethnic minority groups. Indeed, minimum wage laws were once advocated explicitly because of the likelihood that such laws would reduce or eliminate the competition of particular minorities, whether they were Japanese in Canada during the 1920s or blacks in the United States and South Africa during the same era. Such expressions of overt racial discrimination were both legal and socially accepted in all three countries at that time.

Again, it is necessary to note how price is a factor even in racial discrimination. That is, surplus labor resulting from minimum wage laws makes it cheaper to discriminate against minority workers than it would be in a free market, where there is no chronic excess supply of labor. Passing up qualified minority workers in a free market means having to hire more other workers to take the jobs they were denied, and that in turn usually means either having to raise the pay to attract the additional workers or lowering the job qualifications at the existing pay level— both of which amount to the same thing economically, higher labor costs for getting a given amount of work done.

The history of black workers in the United States illustrates the point. As already noted, from the late nineteenth-century on through the middle of the twentieth century, the labor force participation rate of American blacks was slightly higher than that of American whites. In other words, blacks were just as employable at the wages they received as whites were at their very different wages. The minimum wage law changed that. Before federal minimum wage laws were instituted in the 1930s, the black unemployment rate was slightly lower than the white unemployment rate in 1930. But then followed the Davis-Bacon Act of 1931, the National Industrial Recovery Act of 1933 and the Fair Labor Standards Act of 1938— all of which imposed government-mandated minimum wages, either on a particular sector or more broadly.

The National Labor Relations Act of 1935, which promoted unionization, also tended to price black workers out of jobs, in addition to union rules that kept blacks from jobs by barring them from union membership. The National Industrial Recovery Act raised wage rates in the Southern textile industry by 70 percent in just five months and its impact nationwide was estimated to have cost blacks half a million jobs. While this Act was later declared unconstitutional by the Supreme Court, the Fair Labor Standards Act of 1938 was upheld by the High Court and became the major force establishing a national minimum wage. As already noted, the inflation of the 1940s largely nullified the effect of the Fair Labor Standards Act, until it was amended in 1950 to raise minimum wages to a level that would have some actual effect on current wages. By 1954, black unemployment rates were double those of whites and have continued to be at that level or higher. Those particularly hard hit by the resulting unemployment have been black teenage males.

Even though 1949— the year before a series of minimum wage escalations began— was a recession year, black teenage male unemployment that year was lower than it was to be at any time during the later boom years of the 1960s. The wide gap between the unemployment rates of black and white teenagers dates from the escalation of the minimum wage and the spread of its coverage in the 1950s. The usual explanations of high unemployment among black teenagers— inexperience, less education, lack of skills, racism— cannot explain their rising unemployment, since all these things were worse during the earlier period when black teenage unemployment was much lower. Taking the more normal year of 1948 as a basis for comparison, black male teenage unemployment then was less than half of what it would be at any time during the decade of the 1960s and less than one-third of what it would be in the 1970s.

Unemployment among 16 and 17-year-old black males was no higher than among white males of the same age in 1948. It was only after a series of minimum wage escalations began that black male teenage unemployment not only skyrocketed but became more than double the unemployment rates among white male teenagers. In the early twenty-first century, the unemployment rate for black teenagers exceeded 30 percent. After the American economy turned down in the wake of the housing and financial crises, unemployment among black teenagers reached 40 percent.

  • Thomas Sowell, Basic Economics: A Common Sense Guide to the Economy, 4th Edition (New York, NY: Basic Books, 2011), 241; 249-251

And here is more info regarding job loss as the main reason most economists are against the minimum wage… that is because employment IS THEE most important thing to poorer people (while I quote more conservative sources… they themselves are quoting more middle of the road studies):

  • Nearly 90 percent of surveyed economists believed an acceptable federal minimum wage should be less than $15 an hour. When asked what level of wage floor they would support, roughly 40 percent endorsed the current federal hourly minimum wage of $7.25 or less. And 66 percent said the minimum wage should be no higher than $10 an hour (FOX). The survey’s key findings include (PDF of survey can be found at EMPLOYMENT POLICIES INSTITUTE):
    • 74 percent oppose raising the federal minimum wage to $15 an hour;
    • 84 percent believe a $15 minimum wage will have negative effects on youth employment;
    • Two-thirds of economists (66 percent) believe that an appropriate federal minimum wage is $10 an hour or less;
    • Just six percent believe a $15 minimum wage is a very efficient means to target individuals in poverty, while 64 percent said the same thing about the Earned Income Tax Credit (EITC).
  • The nonpartisan Congressional Budget Office said Monday that raising the federal minimum wage to $15 an hour, up from the current rate of $7.25 a hour, would likely cause 1.3 million people to lose their jobs. (WASHINGTON EXAMINER)
  • Economists aren’t certain about many things, but on the minimum wage, nearly all of them (90 percent, according to one survey) believe that the case is open and shut. All else being equal, if you raise the price of something (for instance, labor), then the demand for it (for instance, by employers) will decline. That’s not just a theory; it’s a law. (James Glassman, “Don’t Raise the Minimum Wage,” Washington Post [Feb 24, 1998]
  • …percentage of economists who agree…. A minimum wage increases unemployment among young and unskilled workers. (79%) (Robert M. Beren, Professor of Economics at Harvard University ~ [More: WINTERY KNIGHT])

These specialists are not promoting “a narrative,” but displaying historical consequences as common sense economic laws.


Another Real World Example


See another post where the “Billingsley” example is used: TAX THE RICH (Plus: CEO Pay vs. Worker Pay)

My statement still stands in response to keeping people off the government doll:

Free the Freelancers (Prager U)

Editor’S Note: this is a prime example of when the Left says “we want to help protect you” they often use language to get you to think they are helping… when in fact they are hurting the same people they purport to wish to help. Which is why President Reagan’s quip is so true — because it enumerates what our Constitutional republic was founded to protect us from:
  • The most terrifying words in the English language are: I’m from the government and I’m here to help. — Ronald Reagan

I truly believe Reagan was influenced partially by C.S. Lewis in this thinking:

“Of all tyrannies, a tyranny exercised for the good of its victims may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. They may be more likely to go to Heaven yet at the same time likelier to make a Hell of earth. Their very kindness stings with intolerable insult. To be ‘cured’ against one’s will and cured of states which we may not regard as disease is to be put on a level of those who have not yet reached the age of reason or those who never will; to be classed with infants, imbeciles, and domestic animals.”

C.S. Lewis, God in the Dock (Grand Rapids, MI: W.B. Eerdmans, 2002), 292.

Which is why voting YES on Prop 22 is a must!

What’s the best way to protect the rights of workers? Let them determine their own job preferences, or mandate that companies provide them with certain protections? California has chosen to take the latter path. Has it worked? Is it a victory for workers, or a debilitating defeat? Patrice Onwuka of the Independent Women’s Forum looks into these questions. Her findings may surprise you. For more information on Independent Women’s Forum, go to iwf.org/AB5

The Blue State [Jobs] Crush

Rush Limbaugh on Friday’s show (May 15th) took a call that led him to an important response that places like New York that survive off of their Manhattan business district may lose [permanently] large corporations renting out the office space and paying the high cost of taxes that fund the city and are a large portion of taxes. The people that live and work in the tri-state areas that are also connected to making New York City run (BLUE COLLAR: maintenance, janitorial, tech, etc.) as well as all the business professionals (WHITE COLLAR: administrators, human resources, lawyers, etc.). Not only that, but the new laws and enforcements like these seen in this pandemic may be a cost for companies moving their offices to other states.

Here is an excellent article by the NEW YORK TIMES:

  • Manhattan Faces a Reckoning if Working From Home Becomes the Norm: Even after the crisis eases, companies may let workers stay home. That would affect an entire ecosystem, from transit to restaurants to shops. Not to mention the tax base

Here are a couple other note-worthy articles:

  • Manhattan New Rentals Plunge 71% as Coronavirus Freezes Market (NBC – NECN)
  • Would Gov. Cuomo Rather Have No Businesses in New York Than Businesses That Employ Fewer People? His proposed law would require that corporations return bailout funds if they don’t rehire the same number of employees (REASON)
  • ‘If It Saves Just One Life’: Layoffs Start to Hit Media and Suddenly They Notice the Problem (RED STATE)
  • 100,000 Businesses Have Permanently Collapsed Under Pandemic Lockdowns (THE FEDERALIST)

Do Lockdowns Save Lives? (Larry Elder)

Larry Elder interviews T.J. Rodgers about his WALL STREET JOURNAL article entitled, Do Lockdowns Save Many Lives? In Most Places, the Data Say No: The Speed With Which Officials Shuttered The Economy Appears Not To Be A Factor In Covid Deaths.” The article is excellent, however, I just isolated a shorter version of the interview to include comments on Sweden.

An excellent short commentary on the larger article can be found at TECH STARTUPS: “Lockdowns Don’t Seem to Save Many Lives in Most Places, New Data Shows.” If lockdowns didn’t statistically save lives like anticipated, we have this tragedy to deal with (DAILY WIRE), and politicians and so-called “experts” have answering to do!

In addition to record unemployment numbers, experts now predict that a “wave” of small business bankruptcies is on the horizon — and it could leave the United States with 40% fewer small businesses.

The New York Times reports that the United States Chamber of Commerce estimates “more than 40 percent of the nation’s 30 million small businesses could close permanently in the next six months” — a statistic entirely attributable to the coronavirus pandemic and ensuing lockdowns.

The economic consequences of such a mass business failure could last for “generations,” the NYT reports.

“Commercial bankruptcies in the first quarter of 2020 ticked up 4 percent from a year earlier, according to data from the American Bankruptcy Institute,” according to the NYT. “But many of those filings were made before the pandemic, when the economy was healthy. Right now, some owners are waiting to find out if they will receive federal stimulus aid before deciding whether to file for bankruptcy protection.”

Restaurants and retail services are, of course, the most vulnerable, but family-owned enterprises, like heating and cooling operations and plumbing companies, and even health-care services, particularly small dental and pediatric practices, are in severe danger. The Small Business Restructuring Act, which took effect in February, could help some small businesses stay above water, but many are struggling to keep people on the payroll, to compete with unemployment insurance, and to handle mounting debt.

Of course, large companies — and, in particular, large retail outlets — are not immune to the economic effects of coronavirus. Brands like Neiman Marcus, J. Crew, JC Penney, Macy’s, Gap, GNC, and David’s Bridal are all staring down the possibility that their stores may not reopen once coronavirus lockdowns are lifted, according to USA Today. CNBC says that at least 150 companies, from airline conglomerates to healthcare providers, have warned investors to expect major earnings hits.

The bad economic news keeps piling. In addition to closures, a jobs report, due out from the Department of Labor on Thursday, “will almost certainly show that the coronavirus pandemic inflicted the largest one-month blow to the U.S. labor market on record,” per the Wall Street Journal……

Here is the WALL STREET JOURNAL article:

Do fast shutdowns work to combat the unfold of Covid-19? Joe Malchow, Yinon Weiss and I needed to search out out. We got down to quantify what number of deaths have been brought on by delayed shutdown orders on a state-by-state foundation.

To normalize for an unambiguous comparability of deaths between states on the midpoint of an epidemic, we counted deaths per million inhabitants for a set 21-day interval, measured from when the dying charge first hit 1 per million—e.g.,‒three deaths in Iowa or 19 in New York state. A state’s “days to shutdown” was the time after a state crossed the 1 per million threshold till it ordered companies shut down.

We ran a easy one-variable correlation of deaths per million and days to shutdown, which ranged from minus-10 days (some states shut down earlier than any signal of Covid-19) to 35 days for South Dakota, one in every of seven states with restricted or no shutdown. The correlation coefficient was 5.5%—so low that the engineers I used to make use of would have summarized it as “no correlation” and moved on to search out the true reason behind the issue. (The trendline sloped downward—states that delayed extra tended to have decrease dying charges—however that’s additionally a meaningless consequence because of the low correlation coefficient.)

No conclusions could be drawn concerning the states that sheltered rapidly, as a result of their dying charges ran the total gamut, from 20 per million in Oregon to 360 in New York. This vast variation implies that different variables—like inhabitants density or subway use—have been extra necessary. Our correlation coefficient for per-capita dying charges vs. the inhabitants density was 44%. That implies New York Metropolis may need benefited from its shutdown—however blindly copying New York’s insurance policies in locations with low Covid-19 dying charges, akin to my native Wisconsin, doesn’t make sense.

(CLICK TO ENLARGE)

Sweden is preventing coronavirus with common sense tips which can be a lot much less economically damaging than the lockdowns in most U.S. states. Since individuals over 65 account for about 80% of Covid-19 deaths, Sweden requested solely seniors to shelter in place slightly than shutting down the remainder of the nation; and since Sweden had no pediatric deaths, it didn’t shut down elementary and center colleges. Sweden’s containment measures are much less onerous than America’s, so it will possibly preserve them in place longer to forestall Covid-19 from recurring. Sweden didn’t shut down shops, eating places and most companies, however did shut down the Volvo automotive plant, which has since reopened, whereas the Tesla plant in Fremont, Calif., was shuttered by police and stays closed.

How did the Swedes do? They suffered 80 deaths per million 21 days after crossing the 1 per million threshold stage. With 10 million individuals, Sweden’s dying charge‒and not using a shutdown and big unemployment‒is decrease than that of the seven hardest-hit U.S. states—Massachusetts, Rhode Island, Louisiana, Connecticut, Michigan, New Jersey and New York—all of which, besides Louisiana, shut down in three days or much less. Regardless of tales about excessive dying charges, Sweden’s is in the midst of the pack in Europe, akin to France; higher than Italy, Spain and the U.Okay.; and worse than Finland, Denmark and Norway. Older individuals in care properties accounted for half of Sweden’s deaths.

We must always cheer for Sweden to succeed, not ghoulishly bash them. They could show that many features of the U.S. shutdown have been errors—ineffective however economically devastating—and level the way in which to correcting them.

Mr. Rodgers was founding CEO of Cypress Semiconductor Corp.

10 Reasons Why Blacks Should Leave the Democratic Party

Does the Democratic Party represent the interests of black Americans? Larry Elder gives 10 reasons why blacks might consider leaving the Democratic Party.

10. School Choice
9. Social Security
8. Race-Based Preferences for Diversity
7. War on Poverty (Welfare State)
6. Illegal Immigration
5. Hostility Towards Police
4. Job Killing Regulations
3. The Great Recession (Housing Crisis)
2. Playing the Race Card for Votes
1. Pro-Abortion

Rep. Ocasio-Cortez’s Abject Economic Illiteracy

I am amazed at the illiterate nature of politicians who think money is a zero sum game. That wealth is not created through investment. What Ocasio-Cortez apparently doesn’t or won’t understand is that there is no $3 billion out there that New York could spend… there would have been 24-billion-to-27-billion to spend after the 3-billion in tax-breaks — on subways, infrastructure, and the like. But now there is zero. Zilch. Nada. This deal would have created roughly 25,000 well-paying jobs. The residual job creation was estimated to be an additional 67,000 jobs. Wow. See more here:

NATIONAL REVIEW’S article from July of 2018 seems fitting:

It costs a pretty penny to earn a diploma in stupid.

The annual list price to attend Boston University — including tuition, fees, room, and board — currently rounds out to $70,000. To acquire a degree in economics from this tony institution of higher learning, an undergrad must complete courses in calculus, microeconomic and macroeconomic analysis, empirical economics, statistics, and assorted electives.

Four years, 52 credits and nearly $300,000 later, the school promises that BU economics majors will depart “with a firm understanding of core microeconomic and macroeconomic theory” and the “empirical skills that are essential to applying economic reasoning in our increasingly data-driven world.”

How, then, to explain the abject economic illiteracy of meteoric media darling and democratic socialist “political rock star” Alexandria Ocasio-Cortez?

[….]

Instead of hitting the books, Ocasio-Cortez appears to have spent most of her college days pounding the social-justice pavement. The Boston Globe reports approvingly that she “was active at BU in organizations that empower minorities,” including a stint as president of Alianza Latina, BU’s largest Latin American student organization, and as a student ambassador at the Howard Thurman Center for Common Ground, “which aims to foster inclusiveness among students of all backgrounds.”

Ms. Diversity-ConArtista may be able to blow hot air about Gini coefficients while tweeting anti-capitalist platitudes. But the numbers don’t lie. She’s everything that’s wrong with overpriced liberal ivory towers, radical identity politics, and left-wing media ideologues pining for their next savior.

Illegal Immigration Hurts Black and Brown Communities Job Opportunities

Larry Elder brings some sense with common sense studies showing the impact of illegal immigration on workers in black and brown communities. These legal workers are impacted the most by illegal immigration. I include in the audio Cesar Chavev in a 1972 interview calling illegal immigrants harmful to the union he co-founded. Some key articles are these for those wishing to chase down reliable commentary on the facts:

  • The Rainbow Coalition Evaporates: Black Anger Grows As Illegal Immigrants Transform Urban Neighborhoods. | “A recent study…estimates that immigration accounted for a 7.4 percentage-point decline in the employment rate of unskilled black males between 1980-2000.”
  • Yes, Immigration Hurts American Workers: The Candidates Tell Drastically Different Stories About Immigration. They’Re Both Skipping Half The Truth. | “But because a disproportionate percentage of immigrants have few skills, it is low-skilled American workers, including many blacks and Hispanics, who have suffered most from this wage dip. The monetary loss is sizable.” — George Borjas, Harvard economist.

I was told the other day these are jobs that others will not do. Here are some stats on the matter:

  • “Mark Levin said he was particularly bothered by the claim—made by politicians on both sides of the aisle—that there are so many so-called ‘jobs that Americans will not do.’ Levin mentioned that, according to the Census, 73% of janitors are American citizens, as are 51% of maids and housekeepers, 58%of taxi drivers, 64% of landscapers, 66% of construction workers, and 72% of bellhops, porters, and concierges.” (BREITBART)

 

How The Left Discriminates Against Those It Professes To Champion

I thought of the following Thomas Sowell excerpt via a Facebook discussion regarding illegal immigrants/immigration. Stephanie C. said the following:

  • Does anyone here know how many undocumented people live in SCV? [JUMP TO MORE DIRECT ANSWER] Seems like many people are assuming that if your Hispanic they must be undocumented. I hope people know that’s not the case.

California has the highest illegal immigrant population comparing states. And so the assumption of calling into question one’s “status” may be a logical leap in assumption. Which is why I thought of this Sowell portion of a book I just finished. Here is my Facebook response, followed by an excerpt from the aforementioned book (with a quick set-up for it):

I guess that would be another side-effect [harm] done by the open-borders people. Small companies wanting to hire legal aliens but not having the training or knowledge to know the difference, and so they stay away from them entirely. I just finished a Thomas Sowell book entitled, “Discrimination and Disparities,” and this short/concise book really opened up the consequences of actions.

For instance, businesses is black communities are apprehensive in hiring young black men. Businesses that do background checks hire more young black men than the national average. Businesses that do not do background checks stay away from this demographic.

The Democrats in many of these impoverished areas start campaigns or the largely Democrat city council say that doing background checks is bigoted and targets black workers. Racist in other words, the card overused as of late.

So they force these companies to cease-and-desist. And so these companies offering work experience, communication skills, a sense of pride in ones work, etc., are all thrown to the wayside….. these companies that would and did hire large quantities of young black men stay away from the demographic.

I will forego the posting of what Discrimination 1 and Discrimination 2 are, but the main point easily extracted herein is that Leftist Democrats (“Progressives”) stop background checks in employment due to a [wrongly] perceived targeting of black youth. And so this is yet another example of a problem CREATED through Leftist legislation and then used (black unemployment) to keep said demographic in a state of anger and voting for who will give hand-out and not who will allow the market to create opportunity. I believe the leadership of the Democrat Party has this in mind when doing stuff like this, the general Left leaning population just wants to feel good about their position (SEE QUOTE A).


Another example of a problem CREATED by Democrats and then used in a political manner to rile up it’s base against Trump and the GOP is the immigration battle in sanctuary states is this:


Here is the Sowell excerpt as promised…. FINALLY:

To take an extreme example of Discrimination 1b, for the sake of illustration, if 40 percent of the people in Group X are alcoholics and 1 percent of the people in Group Y are alcoholics, an employer may well prefer to hire only people from Group Y for work where an alcoholic would be not only ineffective but dangerous. This would mean that a majority of the people in Group X— 60 percent in this case— would be denied employment, even though they are not alcoholics.

What matters, crucially, to the employer is the cost of determining which individual is or is not an alcoholic, when job applicants all show up sober on the day when they are seeking employment.

This also matters to the customers who buy the employer’s products and to society as a whole. If alcoholics produce a higher proportion of products that turn out to be defective, that is a cost to customers, and that cost may take different forms. For example, the customer could buy the product and then discover that it is defective. Alternatively, defects in the product might be discovered at the factory and discarded. In this case, the customers will be charged higher prices for the products that are sold, since the costs of defective products that are discovered and discarded at the factory must be covered by the prices charged for the reliable products that pass the screening test and are sold.

To the extent that alcoholics are not only less competent but dangerous, the costs of those dangers are paid by either fellow employees who face those dangers on the job or by customers who buy dangerously defective products, or both. In short, there are serious costs inherent in the situation, so that either 60 percent of the people in Group X or employers or customers— or all three groups— end up paying the costs of the alcoholism of 40 percent of the people in Group X

This is certainly not judging each job applicant as an individual, so it is not Discrimination I in the purest sense of Discrimination Ia. On the other hand, it is also not Discrimination II, in the sense of decisions based on a personal bias or antipathy toward that group. The employer might well have personal friends from Group X, based on far more knowledge of those particular individuals than it is possible to get about job applicants, without prohibitive costs.

The point here is neither to justify nor condemn the employer but to classify different decision-making processes, so that their implications and consequences can be analyzed separately. If judging each person as an individual is Discrimination 1a, we can classify as Discrimination 1b basing decisions about groups on information that is correct for that group, though not necessarily correct for every individual in that group, nor necessarily even correct for a majority of the individuals in that group.

A real-life example of the effect of the cost of knowledge in this context is a study which showed that, despite the reluctance of many employers to hire young black males, because a significant proportion of them have criminal records (Discrimination 1b), those particular employers who automatically did criminal background checks on all their employees (Discrimination 1a) tended to hire more young black males than did other employers.1

In other words, where the nature of the work made criminal background checks worth the cost for all employees, it was no longer necessary to use group information to assess whether individual young black job applicants had a criminal background. This made young black job applicants without a criminal background more employable than before.

More is involved here than simply a question of nomenclature. It has implications for practical policies in the real world. Many observers, hoping to help young black males have more employment opportunities, have advocated prohibiting employers from asking job applicants questions about a criminal record. Moreover, the U.S. Equal Employment Opportunity Commission has sued employers who do criminal background checks on job applicants, on grounds that this was racial discrimination, even when it was applied to all job applicants, regardless of race.2 Empirically, however, criminal background checks provided more employment opportunities for young black males.

[1] Harry J. Holzer, Steven Raphael, and Michael A. Stoll, “Perceived Criminality, Criminal Background Checks, and the Racial Hiring Practices of Employers,” Journal of Law and Economics, Vol. 49, No. 2 (October 2006), pp. 452, 473.

[2] Jason L. Riley, “Jobless Blacks Should Cheer Background Checks,” Wall Street Journal, August 23, 2013, p. All; Paul Sperry, “Background Checks Are Racist?Investor’s Business Daily, March 28, 2014, p. Al.

Thomas Sowell, Discrimination and Disparities (New York, NY: Basic Books, 2018), 23-25 (added references).

Here is an excerpt from Jason Riley’s piece mentioned in footnote #2 above, via HOT AIR:

On the contrary, an October 2006 study in the Journal of Law and Economics, “Perceived Criminality, Criminal Background Checks, and the Racial Hiring Practices of Employers,” found that “employers that check criminal backgrounds are in general more likely to hire African Americans,” according to Harry Holzer of Georgetown University and his two co-authors. “[T]he adverse consequence of employer-initiated background checks on the likelihood of hiring African Americans is more than offset by the positive effect of eliminating statistical discrimination.” These researchers surmise that employers who can screen for prison records are less likely to rely on prejudice when hiring.

Blacks aren’t the only beneficiaries. Analyzing “employer willingness to hire other stigmatized groups of workers (such as workers with gaps in their employment history),” they found the same pattern. The results, they wrote, “suggest that in the absence of background checks, employers use race, gaps in employment history, and other perceived correlates of criminal activity to assess the likelihood of an applicant’s previous felony convictions and factor such assessments into the hiring decision.”

Watch Jason Riley discuss one of his books on C-SPAN’s Book TV interview.


CALIFORNIA UNDOCUMENTED POPULATION


This is with thanks to BLACK PIGEON SPEAKS! Using the numbers below and the idea (fact really) that the largest population of illegal immigrants live in California, I would say California illegal population is at least 13% of Cali’s population. It wouldn’t be unreasonable to say, then, that it could be as high as 20% (so 2-of-every-10 residents). Here are some other factoids:

  • Most undocumented immigrants are from Latin America. Nationwide, 78% of undocumented immigrants are from Latin America—a slight majority (52%) come from Mexico alone. Most of the others (13%) are from Asia, although Africa and Europe also account for hundreds of thousands of undocumented immigrants in the US. The Pew Research Center (PRC) estimates that as of 2014, 71% of California’s undocumented population was Mexican-born.

Yale Professor: There Are “22.8 Million Undocumented Immigrants” In America, Double Official Estimates

A working paper by Dr. Mohammad Fazel Zarandi from the Yale School of Management, coauthored by two other Yale professors, estimates that there are 22.8 million illegal immigrants in the United States.

This is over double estimates compiled by the Department of Homeland Security, which claims 11.1 million illegal aliens live in the US.

The paper’s abstract outlines some of the reasons why their estimate is both higher, and better than the current government statistics:

We apply standard operational principles of inflows and outflows to estimate the number of undocumented immigrants in the United States, using the best available data, including some that has only recently become available. We generate a lower bound for the number of undocumented immigrants using conservative parameter values that underestimate inflows and overestimate outflows.

Our lower bound is close to 17 million, 50% higher than the most prominent current estimate of 11.3 million, which is based on survey data and thus different sources and methods. Standard parameter values generate an estimate of 22.8 million undocumented immigrants, twice as large as the current estimate.

Conservatives have argued for well over a decade that the number of illegal immigrants is widely underestimated by the government, and think tanks which base their calculations on government data—finally academics are beginning to take an independent look at the problem.

But the fact that the paper needed to be written at all highlights an insidious problem: we really don’t know how many illegal immigrants live in the US. With that in mind, I think it’s worth surveying the research on the topic—at the very least I’ll be able to give you some context for the broader debate….

Walmart’s Robot Revolution

The field of work is changing. Programmers, engineers, maintenance… that one job done by a human has turned into many jobs. Just gotta change your degrees from 18th century lesbian feminist writers to something more “techy.” A degree in literature is out — if you want to pay the bills some other way than waitressing, change your major.

Ben Ferguson Fills In For Mark Levin – And Hits Homers!

Ben Ferguson of the “Ben Ferguson Show,” filled in for Mark Levin. I really like the guy. I would love to help him prep responses! Anyhew, he took a call from a guy who says Trump’s deregulating certain aspects of government actions is destroying the environment. The Keystone Pipeline ended up being the topic of discussion. Enjoy.

While filling in for Mark Levin, Ben Ferguson of the “Ben Ferguson Show”, took a call from a guy who thought Trumps deregulations hurt the economy. Follow Ben on TWITTER.

94% Of New Jobs Created During Obama’s Era Were Temporary Positions

This comes from YOUNG CONSERVATIVES:

From Investing:

A new study by economists from Harvard and Princeton indicates that 94% of the 10 million new jobs created during the Obama era were temporary positions.

The study shows that the jobs were temporary, contract positions, or part-time “gig” jobs in a variety of fields.

Female workers suffered most heavily in this economy, as work in traditionally feminine fields, like education and medicine, declined during the era.

The research by economists Lawrence Katz of Harvard University and Alan Krueger at Princeton University shows that the proportion of workers throughout the U.S., during the Obama era, who were working in these kinds of temporary jobs, increased from 10.7% of the population to 15.8%.

Krueger, a former chairman of the White House Council of Economic Advisers, was surprised by the finding.