I keep bringing up Wal-Mart in posts and comments, which is strange since Wal-Mart isn’t something pleasant to think about. But I wish there was more discussion about the recent SCOTUS ruling in favor of Wal-Mart because that case brings up some critically important issues for the future of the American economy. Though Wal-Mart was successful, the case still reveals how perilously close we are to a massive, court-ordered imposition of government-think on American business.
Writing on the case in National Review Online, Michael Barone says:
The conclusion I draw is that Ginsburg thinks the only fair way to run a large organization is the way government runs civil service.
All jobs should be numerically classified to eliminate “arbitrary and subjective criteria.” Promotions should be determined by written tests or seniority, not by managers choosing “on the basis of their own subjective interpretations.”
Managers should understand that they will face harsh scrutiny if they don’t hire and promote equal numbers of men and women and pay them all the same. Better just to figure out how to make your gender quotas and avoid any trouble
Battles over government budgets get a lot of press. I wish there were more press on the much more pernicious effect of government’s meddling in the operation of firms. Huge efficiency losses occur when government-think is imposed on business. This happens through court decisions and regulations that most people don’t pay much attention to. The Obama administration’s decision to try to keep Boeing from building productive capacity in South Carolina, a right-to-work state, is another egregious and unconstitutional example of government raising the cost of doing business. Hopefully Boeing will be successful in their efforts. Obama cannot push Big Labor’s agenda through legislation, so he is trying to squash the healthy competition between states that allows firms to lower long-run labor costs, even as they create more jobs.
I think our economy can thrive even with an inefficient, bloated public sector. But the expansion of government’s sticky fingers into the day-to-day operations of businesses is much harder to overcome because it is hard to see and has consequences that are hard to measure. Sometimes political candidates talk about stripping away regulations, but neither party has ever shown an aggressive agenda for dismantling the regulatory state.
Unfortunately, most companies don’t have the resources to fight the government that Wal-Mart or Boeing do, so they just knuckle under. The sad irony is that the Lefties promote these job-killing federal actions in the name of improving life for the working class.