Tag Archives: Parasitism

News

New study: reducing government regulation creates jobs

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From the Washington Examiner.

Excerpt:

According to the Phoenix study, “even a small 5% reduction in the regulatory budget (about $2.8 billion) would result in about $75 billion in expanded private-sector GDP each year, with an increase in employment by 1.2 million jobs annually. On average, eliminating the job of a single regulator grows the American economy by $6.2 million and nearly 100 private sector jobs annually.” The reverse is true as well, according to Phoenix, which said “each million dollar increase in the regulatory budget costs the economy 420 private sector jobs.”

“Our statistical analysis of historical data indicates that federal expenditures on regulatory activity have a significant impact on the size of the private-sector economy and private-sector employment,” says Dr. George S. Ford, chief economist at the Phoenix Center. “While the entire federal budget must be cut to address the deficit problem, the evidence indicates that reductions in the overall federal regulatory budget may substantially impact the growth of economic output and employment.”

It’s hard to imagine any way of making it clearer: Whatever merits it may otherwise have, the federal regulatory bureaucracy is a tremendous drag on the economy, diverting and destroying the very precious investment capital that is essential to generating the growth that creates jobs that pay the taxes that fund the government. This provides an important insight into why federal offices like the Environmental Protection Agency do not consider the effect of proposed regulations on the ability of the economy to generate jobs.

If you want job creators to create jobs, ask the job creators what is stopping them from creating jobs. At the top of their list will be government regulations.
Commentary

We’ve become a nation of takers, not makers

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From moderate conservative Stephen Moore, writing in the Wall Street Journal. (H/T ECM)

Excerpt:

If you want to understand better why so many states—from New York to Wisconsin to California—are teetering on the brink of bankruptcy, consider this depressing statistic: Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960, when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government.

It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of the states. The not-so Golden State now has an incredible 2.4 million government employees—twice as many as people at work in manufacturing. New Jersey has just under two-and-a-half as many government employees as manufacturers. Florida’s ratio is more than 3 to 1. So is New York’s.

Even Michigan, at one time the auto capital of the world, and Pennsylvania, once the steel capital, have more government bureaucrats than people making things. The leaders in government hiring are Wyoming and New Mexico, which have hired more than six government workers for every manufacturing worker.

Now it is certainly true that many states have not typically been home to traditional manufacturing operations. Iowa and Nebraska are farm states, for example. But in those states, there are at least five times more government workers than farmers. West Virginia is the mining capital of the world, yet it has at least three times more government workers than miners. New York is the financial capital of the world—at least for now. That sector employs roughly 670,000 New Yorkers. That’s less than half of the state’s 1.48 million government employees.

The problem with having a high number of government workers is that government workers don’t actually produce anything to sell. They pay the salaries of their workers by taking a percentage of the money that productive business make when they sell customers useful things like cell phones and laptops and automobiles.

This article is the second most popular on the Wall Street Journal. Recommended.

News

Obama doubles the number of federal workers paid over $150,000

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USA Today reports that the number of federal works earning $150,000 or more has DOUBLED since Obama took office.  (H/T Gateway Pundit)

Excerpt:

The number of federal workers earning $150,000 or more a year has soared tenfold in the past five years and doubled since President Obama took office, a USA TODAY analysis finds.

The fast-growing pay of federal employees has captured the attention of fiscally conservative Republicans who won control of the U.S. House of Representatives in last week’s elections. Already, some lawmakers are planning to use the lame-duck session that starts Monday to challenge the president’s plan to give a 1.4% across-the-board pay raise to 2.1 million federal workers.

Meanwhile, the unemployment rate averaged 9.43% under Obama.