You can’t keep regulating the workplace without killing jobs.Sep 7, 2015, Vol. 20, No. 48 • By ANDREW B. WILSON
Twenty-one years ago, Fortune boldly declared “The End of the JOB.” Thanks to rapid advances in technology, people had been freed from the tyranny of the nine-to-five workplace. Now they could set their own hours and schedules, do without constant oversight and supervision, and concentrate on a more powerful objective: not just “doing their jobs,” but finding better and more innovative ways of “doing what needs to be done.”
In today’s world, Uber Technologies Inc. stands as a perfect example of a “post-job” success story. It is now serving millions of hugely satisfied customers and providing part-time or full-time work for 200,000 active drivers in 311 cities around the world. Its app-based method of connecting users and providers of taxi service is the feather that has knocked a whole industry on its ear—an industry that had been doing the same things in the same way for three-quarters of a century.
One can also cite the sprouting of dozens of major franchise operations like Two Men and a Truck that have combined to provide millions of new jobs through thousands of small business startups over the past two decades. Like Uber, they have discovered work that clearly needed to be done—once people hit upon the right way of doing it.
But none of that cuts any ice with the Obama administration and its appointed chieftains at the Department of Labor and the National Labor Relations Board. Far from applauding greater freedom and creativity in the workplace, they want to restore the old-fashioned job to something like its former prominence, but with a raft of new government-imposed rules and regulations. By limiting the growth of independent contracting and other means of farming out work to individuals or small businesses, the Labor Department wants to herd as many workers as possible back into the corral of corporate employment—with Big Brother there to watch out for their best interests.
Former college professor David Weil, the Labor Department’s top wage-law enforcer, explains the broad thinking behind such policies in his book The Fissured Workplace: Why Work Became So Bad for So Many and What Can Be Done to Improve It, published last year. Weil blames decades of outsourcing or subcontracting for deteriorating conditions in the workplace. He argues that big companies have tried to have it both ways—on one hand, making harsh or impossible demands on subcontractors; on the other, taking no responsibility for the plight of workers. The solution that follows from Weil’s analysis is to force big employers to bring many jobs back in-house—and then subject them to farther-reaching and more stringent rules and regulations.
But if the analysis is faulty, the solution is no good. Why should we suppose that it is so easy for companies to mistreat or abuse subcontractors, or be motivated to do so? Should we always assume the worst of capitalist enterprise?
In public statements, Weil has complained of “jaw-dropping” violations of standard labor laws and accused employers of “finessing” job descriptions and duties in order to miscategorize workers who remained under their supervision as independent contractors rather than employees. He claims this practice has caused many dispossessed workers to incur expenses related to their jobs while losing access to overtime pay, vacation pay, and other benefits.
While waiting for Labor Department lawyers to bring forth the proof behind such accusations, you can expect to witness a good deal of hair-splitting over the legal definition of an employee. On July 15, Weil released a 15-page memo that was supposed to “clarify” the Labor Department’s stance regarding “employees who are misclassified as independent contractors.” The memo concluded that the “ultimate determination” would turn on “whether the worker is really in business for himself or herself (and thus an independent contractor) or is economically dependent on the [putative] employer (and thus an employee).”
But that surely is a false dichotomy. For example, does an Uber driver automatically become an Uber employee because he chooses to drive 40 or more hours a week and gets most or all of his income from the company? Or does he remain an independent contractor
(1) because he picks where and when he works, (2) because he (like other Uber drivers) is free at any time to accept work from Lyft, its chief competitor, and (3) because he has no wish to be an employee?
Another time for choosing.Sep 7, 2015, Vol. 20, No. 48 • By RYAN STREETER
Whatever the outcome of the 2016 presidential election, the summer of 2015 will be remembered as the summer of Trump and Sanders. The other candidates, especially the Republicans, could learn a lesson from the two renegades, who have figured out how to capitalize on the fact that America is in a funk even as its economy improves.
Sep 7, 2015, Vol. 20, No. 48 • By IRWIN M. STELZER
The economic recovery is barely worthy of the name, and there is evidence that inequality in America is increasing. Ignoring the first rule of statistics—correlation is not causation—progressives see this as a new reason to expand government. Reduce inequality and the growth rate will increase.
Why does Washington, D.C., subsidize food trucks?4:11 PM, Feb 4, 2015 • By IKE BRANNON
About a year ago, the government of Washington, D.C., introduced a lottery system to allocate lunch hour parking spots for the city’s booming food truck industry. The one-year retrospectives have been almost uniformly positive, with the government, the media, and the food truck vendors themselves declaring it a rousing success.
I beg to differ.
9:29 AM, Jul 23, 2012 • By DANIEL HALPER
A new ad from Senator Scott Brown, contrasting statements in support of free enterprise by those like John F. Kennedy, Bill Clinton, Ronald Reagan with those made by Barack Obama and Brown's Massachusetts Senate opponent, Elizabeth Warren:
6:24 PM, Jul 19, 2012 • By DANIEL HALPER
Paul Ryan, writing in the Financial Times:
"The protection of big business remains a common thread in Mr Obama’s policies, which have come at the expense of the consumer, the taxpayer and the entrepreneur. A growing coalition of reformers – rooted in citizen movements across the political spectrum – reject this pernicious crony capitalism. Our solutions promote an opportunity society, one that is rooted in the US commitment to free enterprise.
1:50 PM, Jan 10, 2012 • By WILLIAM KRISTOL
There’s a lot of silliness on all sides of the Bain Capital debate.
On the one hand, Newt Gingrich’s attacks (and the follow-on assaults by Jon Huntsman and Rick Perry) on Mitt Romney’s career at Bain Capital have been unfair, over the top, and, for that matter, all over the place. Gingrich, Perry, and Huntsman deserve much of the criticism they’ve received from conservative commentators.
On the other, Mitt Romney’s claim throughout his campaign that his private sector experience almost uniquely qualifies him to be president is also silly. Does he really think that having done well in private equity, venture capital, and business consulting—or even in the private sector more broadly—is a self-evident qualification for public office? One assumes Mitt Romney would agree that Chris Christie is a better chief executive of New Jersey than Jon Corzine, and that Rudy Giuliani was a better mayor of New York than Mike Bloomberg. But Romney’s biography looks a lot more like Bloomberg's or Corzine's (leaving aside Corzine's recent misadventures) than like that of Giuliani (pre-mayoralty) or Christie. Past business success does not guarantee performance in public office. Indeed, Romney sometimes seems to go so far as to suggest that succeeding in the private sector is intrinsically more admirable than, e.g., serving as a teacher or a soldier or even in Congress. This is not a sensible proposition, or a defensible one.
10:55 AM, Jan 10, 2012 • By JONATHAN V. LAST
There’s a line of thinking you often hear from Republican-types about how markets are never wrong. You think a certain CEO’s lavish compensation is ridiculous? Nonsense, those types tell you. You think that a CEO’s VORP—that’s a baseball stat that translates, in this case, to the CEO’s marginal value versus the average replacement CEO—couldn’t possibly be so high? They simply counter that he’s worth the money because there’s someone willing to pay it. The results in a market triumph considerations of value.
Congressman Paul Ryan disputes NY Times columnist's claims on taxes, spending, and Medicare.7:30 PM, Aug 9, 2010 • By JOHN MCCORMACK
Talking late this afternoon with THE WEEKLY STANDARD, Republican congressman Paul Ryan of Wisconsin blasted New York Times columnist Paul Krugman for his "intellectualy lazy" attack on Ryan's fiscal "Roadmap." In his Friday column, Krugman called Ryan a "charlatan" and his plan to reform the welfare state and eliminate the debt a "fraud" that is "drenched in flimflam sauce." Ryan responded to Krugman in the Milwaukee Journal Sentinel over the weekend, and elaborated on his criticisms of Krugman this afternooon.
Fly away. No, really. Please do.10:05 AM, Apr 13, 2010 • By MARY KATHARINE HAM
If there was ever an example of how little faith senators have in the free market, this is it. When Spirit Airlines announced last week it would start charging up to $45 for carry-on baggage, it caused an uproar with, well, everyone. In the media, around the water cooler, on Facebook walls around the world, the new fee was denounced as ridiculous on its face.
The idea actually may not be as crazy as it sounds. Spirit is built to be a discount airline, and it says the new fees allow it to cut base fare prices, and make boarding and deplaning more efficient. I can see myself carrying only a backpack/purse in exchange for a $70 roundtrip ticket. The airline will not likely be able to sell already grumbly airline passengers on the virtues of its new fee structure (It's kick-off was inauspicious.), but it's a rather simple problem for the market to solve.
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