• About

Sacred Cow Chips

Sacred Cow Chips

Tag Archives: Stop BEZOS Act

BS Bernie Blames Bezos

12 Wednesday Sep 2018

Posted by pnoetx in Labor Markets, Living Wage, Price Mechanism, Welfare State

≈ Leave a comment

Tags

Amazon, Bernie Sanders, Freedom of Contract, Jeff Bezos, Living Wage, Ro Khanna, Social Safety Net, Stop BEZOS Act, Welfare State

Bernie Sanders keeps probing for ways to create a backdoor minimum income, and he’s eager to loot successful job creators and their customers in the process. Last month I wrote about the folly of his proposed legislation that would offer federal job guarantees to all. A new Sanders bill, introduced jointly with Rep. Ro Khanna (D – CA), is an equally bad idea called the Stop BEZOS Act, or the “Stop Bad Employers by Zeroing Out Subsidies Act”. It’s pretty obvious that the selection of the acronym preceded the naming of the bill. Imagine the fun his Senate staffers had with that! The logical flaws embedded in the title of the act are bad enough. The effort to garner attention by using the title to smear the name of a famous technology entrepreneur is sickening.

Jeff Bezos, of course, is the founder and CEO of Amazon, the online retailer, as well as the owner of the Washington Post. Amazon has been rewarded by consumers for its excellent service and aggressive pricing, and it is now valued at about $1 trillion. That makes Bezos a very wealthy man, and it is no coincidence that Sanders has chosen to make an example of him in an effort to inflame envy and classist passions.

While some details of the bill remain sketchy, firms with more than 500 workers would face a 100% tax on every dollar of federal benefits received by those employees. But the tax would apply only to “low-wage” employees, however that is defined, and not simply any employee receiving federal benefits. If the bill became law (and it won’t any time soon), it would require a costly federal administrative apparatus to coordinate between several agencies, including the IRS. Beyond the tax itself, the compliance costs for firms won’t be cheap, and it will create terrible incentives: if you own a business, you would have a strong incentive to avoid hiring workers with little experience or weak skills, or anyone you might deem likely to be a recipient of federal aid. If you have 499 employees, you’ll probably think hard about how to execute future growth plans. Nothing could do more to improve the return to investment in automation.

Is Amazon really a “bad” employer? That’s what the title of the Sanders bill says. In fact, the company has been accused of harsh labor practices in its fulfillment centers. Life for corporate managers is said to be no picnic, and labor turnover at Amazon is high. Nonetheless, the wages it pays attract plenty of applicants. Unskilled labor does not command a high wage, and that is no fault of an employer willing to provide them with work and experience. Yet the bill would punish those employers, as well as employers having part-time workers drawing federal aid.

An absence of punishment can hardly be described as a “subsidy”, as the bill’s title suggests. But that is exactly how leftists think, at least when they do the punishing. In this respect, the bill’s title is an assault on logic and a misuse of language. It would also represent a violation of constitutional principles like property rights and freedom of contract.

The idea of taxing employers to recoup any public aid received by their workers is intended to affect a de facto “living wage”. However, one benefit of an independent social safety net, as opposed to a living wage tied to that net, is that the former largely preserves the operation of labor markets, despite creating some nasty labor-supply incentives. Wage rates that approximate the value of worker productivity allow efficient matching of jobs with workers having the requisite skills, even if the skills are relatively low-grade. Those wages also minimize distortions in the economics of production within firms and across different industries. Furthermore, prices faced by buyers should reflect the real resource costs associated with demands for various goods. They should not be inflated by political decisions about the level of federal welfare benefits. Quite simply, preserving labor market efficiency enhances the ability of the economy to allocate resources to the uses for which they are most highly-valued.

There are independent questions about whether the structure and level of benefits provided by the welfare state are appropriate. Those are matters of legitimate policy debate, and those benefits must be funded by taxpayers, but they should be funded in the least distortionary way possible. Bernie Sanders imagines that the burden of those taxes can simply be imposed on large employers with no further consequences, but he is badly mistaken. Consumers will shoulder a significant part of that burden under his latest scheme. And, of course, Sanders’ beef with Bezos is a cynical political ploy. It amounts to cheap scapegoating intended to promote another one of Sanders’ bad policy ideas.

Follow Sacred Cow Chips on WordPress.com

Recent Posts

  • Let’s Suppress Fraudulent Votes
  • Fiscal Foolishness a Costly Salve For Midterm Jitters
  • Relax: Natural Variability Causes Heatwaves
  • The Vampiric Nature of “Stakeholder” Capitalism
  • Fueled, Ignored, Misdiagnosed in DC, Inflation Broadens

Archives

  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014

Blogs I Follow

  • Passive Income Kickstart
  • OnlyFinance.net
  • TLC Cholesterol
  • Nintil
  • kendunning.net
  • DCWhispers.com
  • Hoong-Wai in the UK
  • Marginal REVOLUTION
  • CBS St. Louis
  • Watts Up With That?
  • Aussie Nationalist Blog
  • American Elephants
  • The View from Alexandria
  • The Gymnasium
  • A Force for Good
  • ARLIN REPORT...................walking this path together
  • Notes On Liberty
  • troymo
  • SUNDAY BLOG Stephanie Sievers
  • Miss Lou Acquiring Lore
  • Your Well Wisher Program
  • Objectivism In Depth
  • RobotEnomics
  • Orderstatistic
  • Paradigm Library

Blog at WordPress.com.

Passive Income Kickstart

OnlyFinance.net

Financial Matters!

TLC Cholesterol

Nintil

To estimate, compare, distinguish, discuss, and trace to its principal sources everything

kendunning.net

The future is ours to create.

DCWhispers.com

Hoong-Wai in the UK

A Commonwealth immigrant's perspective on the UK's public arena.

Marginal REVOLUTION

Small Steps Toward A Much Better World

CBS St. Louis

News, Sports, Weather, Traffic and St. Louis' Top Spots

Watts Up With That?

The world's most viewed site on global warming and climate change

Aussie Nationalist Blog

Commentary from a Paleoconservative and Nationalist perspective

American Elephants

Defending Life, Liberty and the Pursuit of Happiness

The View from Alexandria

In advanced civilizations the period loosely called Alexandrian is usually associated with flexible morals, perfunctory religion, populist standards and cosmopolitan tastes, feminism, exotic cults, and the rapid turnover of high and low fads---in short, a falling away (which is all that decadence means) from the strictness of traditional rules, embodied in character and inforced from within. -- Jacques Barzun

The Gymnasium

A place for reason, politics, economics, and faith steeped in the classical liberal tradition

A Force for Good

How economics, morality, and markets combine

ARLIN REPORT...................walking this path together

PERSPECTIVE FROM AN AGING SENIOR CITIZEN

Notes On Liberty

Spontaneous thoughts on a humble creed

troymo

SUNDAY BLOG Stephanie Sievers

Escaping the everyday life with photographs from my travels

Miss Lou Acquiring Lore

Gallery of Life...

Your Well Wisher Program

Attempt to solve commonly known problems…

Objectivism In Depth

Exploring Ayn Rand's revolutionary philosophy.

RobotEnomics

(A)n (I)ntelligent Future

Orderstatistic

Economics, chess and anything else on my mind.

Paradigm Library

OODA Looping

  • Follow Following
    • Sacred Cow Chips
    • Join 120 other followers
    • Already have a WordPress.com account? Log in now.
    • Sacred Cow Chips
    • Customize
    • Follow Following
    • Sign up
    • Log in
    • Report this content
    • View site in Reader
    • Manage subscriptions
    • Collapse this bar
 

Loading Comments...