They know. They aren’t complete idiots. When enemies of the market routinely try to stop people from earning a living through restrictions like minimum wage laws and arbitrary licensing to thwart such dangerous activities as hair-braiding, few are ignorant of the disastrous consequences.
Case in point?
The Biden administration is on the verge of using a federal version of California’s AB5 law to mass-slaughter the opportunities of millions of gig workers and freelancers. The administration hasn’t managed to do it legislatively. So it’s trying to inflict the damage with a Department of Labor regulation.
The idea is to stop companies from classifying independent contractors as independent contractors. Passed in California a few years ago, AB5 prohibited companies and many contractors from working with each other unless companies took them on as regular employees.
To avoid the costs of doing that, many companies instead simply ended their relationships with hundreds of thousands of gig workers. For example, Rev, a transcription service, stopped working with all freelancers residing in California.
California lawmakers knew how destructive AB5 would be when they passed it — proof-positive being the many exceptions for politically connected groups that were stipulated as part of the law. AB5 has now been repealed and replaced by AB2257, which increases the varieties of worker exempt from the new requirements. But it still leaves many other people, like California-based truckers, in legal limbo.
It’s okay though, because all truckers do is deliver the stuff that all the rest of us need to survive.
This madness should not be imposed on everybody throughout the country.
And certainly not by back-room bureaucratic machinations.
This is Common Sense. I’m Paul Jacob.
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2 replies on “The Biden’s War on Independents ”
The pretense is that these regulations are about protecting workers, but they are really about providing monopolistic economic rents* to cartels.
The ability of Congress to delegate its legislative responsibilities to regulators (or its war powers to the President) runs into an interesting constitutional problem. Specifically, if it can do so, then it must have an power, unmentioned in the Constitution, to repeal delegating legislation without the possibility of a Presidential veto.
In the last few years, serious legal scholars have returned to consideration of the doctrine that Congress cannot delegate authority to regulators. Democratic greed on the present scale may push plaintiffs to bring the question before the Supreme Court, and push the Court to begin significantly limiting that supposed authority.
* For historical reasons, factor payment in excess of what would be necessary to bring the factor(s) into use is called “economic rent”. Economic rents cause resources truly to be wasted. Some party might be made better-off the short-run, but others are made worse-off in that same short-run, and the future is eroded for those who will live in it.