Why Does Government Make it so Difficult to Hire Anyone?

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And why don’t voters figure this out?

New rules just announced in France will mean that you cannot sell a business without consulting your workers or shut down a plant without documenting that you have tried to sell it.

These rules are similar to President Obama’s proposal that workers who have applied for a job and not been hired should be able to sue for discrimination. Or to economist Paul Krugman’s proposal that a government agency in the US should be able to review and approve or deny any terminations or layoffs of employees.

What all these rules or proposals have in common is they are meant to win votes or please unions by creating more employment. But as anyone with an ounce of common sense could predict, they backfire by chilling the normal desire of employers to hire. Under normal conditions, employers are motivated to hire, because they hope that expansion will lead to more profit. But if there is no exit from a mistaken expansion or bad hire, then the employer will hire only as few people as are absolutely necessary to stay in business and will try even harder to substitute machinery or equipment for labor. Even if the robot is less economical than a human employee, the employer will buy the robot.

In other words, all these measures are simply job killers which hurt employees. Other job killers are minimum wage laws that especially strike hard at teenagers or other young people who cannot get on-the-job training, new rules that require payment of overtime to employees with college degrees, and of course Obamacare’s disincentive to hire more than 49 workers or to hire full time employees.

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